1. IBM Smarter Planet Strategy Florence D
IBM Smarter Planet Strategy Florence D. Hudson Energy & Environment Executive Cloud Computing Strategist IBM Corporate Strategy
A Smarter Planet
IBM Confidential

2. Agenda Personal Career Path IBM Smarter Planet Solutions
IBM Energy and Environment Initiatives for a Smarter Planet
IBM Confidential

3. Florence DiStefano Hudson – Personal Career Path
Education:
Elementary and Secondary school on Long Island, New York
Princeton University, BSE in Mechanical and Aerospace Engineering
Executive education at Harvard Business School and Columbia University School of Business
Summer Internships at Grumman and NASA Jet Propulsion Lab
Hewlett Packard in California
IBM since 1981 – living in New York State with global travel to 20 countries
Sales, marketing, development, channels, strategy, human resources
Executive since 1999 in strategy and marketing
Energy and Environment Executive , and Cloud Computing Strategist 2010
SWE Executive on Loan , SWE Board of Directors 2006, SWE Board of Trustees 2010
US, Canada, Trinidad, UK, Italy, Germany, Switzerland, Spain, Monaco, France, India, China, Hong Kong, Japan, Korea, Singapore, Malaysia, Thailand, Vietnam,
IBM Confidential

4. A Smarter Planet: The Next Leadership Agenda
Prime areas to consider for improvement
How much energy we waste: 6% to 10% lost because grids are not smart
How gridlocked transportation in cities is: $78B annual loss in U.S. in wasted gas and time
How our water supply is drying up: 6 fold increase in demand at twice rate of population growth
How antiquated our healthcare is: no linkage from diagnosis to providers to insurers to employers
“The digital and physical infrastructures of the world are converging. We must make the mundane processes of business, government and life sustainable.”
Inefficiency of our supply chains: $40B annual loss in CPG & Retail industries, 3.5% of sales
Crisis in financial markets: inability to track risk has undermined confidence
Source: Sam Palmisano remarks to the Council on Foreign Relations, New York City, November 6, 2008

5. Many of IBM’s smarter planet initiatives are interconnected – www. ibm
Many of IBM’s smarter planet initiatives are interconnected –
Water
Whether too much or not enough, the world needs a smarter way to think about water
Buildings
Given their environmental impact, it's time we designed from the earth up
Cities
Safe neighborhoods. Quality schools. Affordable housing. Traffic that flows. It's all possible.
Oil
Get to the "first" oil faster. Increase recovery rates. Sense and solve problems before they start.
Intelligence
Smart thinking about data analysis
Traffic
How we get from point A today to point B tomorrow
Healthcare
Public Safety
Buildings
Products
Cities
Water
Work
Retail
Intelligence
Telecom
Rail
Traffic
Energy
Infrastructure
Food
Government
Banking
Oil
IBM Confidential

6. Energy & Environment Focus
The Bad News: IT accounts for 2% of global CO2 emissions
The Good News: IT can significantly contribute to control and reduce the 98% of CO2 emissions caused by other activities and industries
Across the board, information technology can make enormous contributions to improve energy efficiency and reduce greenhouse gases.
IT accounts for just 2% of global carbon emissions. But IT can significantly contribute to control and reduce the 98% of carbon emissions caused by other activities and industries – including transportation, smart grids and more.
The economic advantages for businesses—both large and small—to "go green" are enormous. Not only are energy efficient technology and processes good for their own sake, but they enable most companies to realize dramatic cost savings.
This goes to the root of "sustainable development." Economic prosperity and environmental protection must go hand-in-hand. And often, when you improve the efficiency of a product or process, you also improve the environment. It's a win/win situation for companies and society as a whole.
Additional data points:
IT energy usage will double in the next 4 years. (Green IT: A New Industry Shock Wave – Gartner Symposium/ITxpo, October 2007)
data centers consumed 180B kwh in 2007, a figure that’s expected to double over the next 4 years
some digital media firms are forecasting doubling consumption annually
companies spent more than $29B in power and cooling in 2007 (US Energy Information Administration, IDC)
1 billion computers will become potential scrap by 2010 and only 45% of US companies have eco-friendly disposal plans. The potential toxic risks of improper disposal are enormous. (IDC, National Safety Council)
It’s estimated that the enabling role of IT and other advanced technologies can deliver more than 50% of the goals set within the EU Energy Efficiency Action Plan. (Source: AeA Europe, )
“… you can’t make a product greener, whether it’s a car, a refrigerator or a traffic system, without making it smarter — smarter materials, smarter software or smarter design.” - Thomas L. Friedman
Sources: Gartner, Green IT, October 12, 2007; “The Green Road Less Traveled” by Thomas L. Friedman, The New York Times, July 15, 2007,
IBM Confidential

7. Tackling climate change is good for the climate and economy
Information and Communications Technology (ICT)
can significantly improve energy efficiency and reduce GHG emissions, driving potentially $1 Trillion in energy savings per year by 2020 and 7.8 Gigatons CO2e abatement
Smart Logistics: $442B/year
Smart Buildings: $341B/year
Smart Industrial Automation:
$107B/year
Smart Grids:
$125B/year
Source: The Climate Group, “Smart 2020: Enabling the Low Carbon Economy in the Information Age.” 2008

8. What does it mean to become Smarter?
Measuring, Monitoring, Modeling and Managing
Our world is becoming
INSTRUMENTED
Sensing
Metering
Data collection
Real Time
Data Integration
Data Integration
Our world is becoming
INTERCONNECTED
Incentives and actions to change behavior
Feedback to user and data source;
Real Time
+ Historical Data
Incentives and actions to change behavior
Feedback to user and data source;
Comparison of historical data, with newly collected data
Data Modeling
+ Analytics
Data modeling and analytics to create insights to optimize smarter decisions
Virtually all things are becoming
INTELLIGENT
Visualization
+ Decisions
Source: IBM Corporate Strategy

9. IBM innovations address energy & environment challenges
Smarter IT Infrastructure
IT and data center facilities energy efficiency
Monitoring & verification of efficiency goals
Energy Efficient, Virtualized, Dynamic IT/DC
Cloud computing
IBM and client case studies: 40% to 80% energy use reduction, up to 85% less floor space
Mobility Services
Green IT and Data Centers
Reduce traffic and pollution
Retain and attract talent
Cut facility costs/impact
Smart Grid
Smarter Transportation Systems
Reduce energy usage
Improve grid management, reduce outages
U.S. case study: 10% energy use reduction, up to 50% reduced load on electric grid
Reduce traffic congestion
Reduce CO2 emissions
Increase mass transit usage
Improve environment
Stockholm case study: Reduced traffic congestion 25%, Carbon emissions 15%
Smarter Water Management
Flood avoidance
Reduce water usage
IBM case study: 27% reduced water usage, with 30% increase in manufacturing output, saving $M in energy and water cost
Wherever you begin, IBM can help.
Whether it’s energy efficient technologies and services, or applying information technology to telecommuting opportunities, transportation challenges, smart grids, carbon management, water management, or looking for research and development focus on alternative energy, IBM is ready to help.
Sustainable Business Solutions & Services
Strategy
Corporate Social Responsibility
Green Sigma TM
Green SNOW - Supply Chain Network Optimization Workbench
Smarter Cities
Smarter Buildings
Cap and Trade Systems
Alternative Energy Research
IT to ET: Applying IT cooling technologies to concentrator PV
IBM know-how in thin films, advanced photovoltaic materials
Nanomembranes for desalination
Energy storage, modeling and analytics for optimization in energy efficiency and renewable energy, etc.
IBM Confidential

10. Energy, Environment and Sustainability Initiatives help
Build a Smarter Planet – Delivering Innovations that
matter to business, government, people and the planet
Energy Efficient Technologies and Services
Intelligent Transportation Systems
Intelligent Utility Networks
Advanced Water Management
Sustainable Solutions & Services
Green Supply Chain – Green SNOW
Green Sigma TM
Smarter Buildings
Cap and Trade Systems
Smarter Cities
Alternative Energy Research

11. Energy Efficient Technologies and Services
Energy efficient solutions:
Green IT and Green Datacenters
Servers and storage continually more energy efficient
New and retrofit equipment
Rear Door Heat Exchanger
Measurement & Management Technology
Monitoring & verification of efficiency goals through Energy Efficiency Certificates
Virtualization, consolidation
Benefits and studies:
40% to 80% energy use reduction
Up to 85% less floor space
Wherever you begin, IBM can help.
Whether it’s energy efficient technologies and services, or applying information technology to telecommuting opportunities, transportation challenges, smart grids, carbon management, water management, or looking for research and development focus on alternative energy, IBM is ready to help.
IBM Confidential

12. Cloud Computing
“Cloud” is a new consumption and delivery model inspired by consumer Internet services.
Cloud enables:
Self-service
Sourcing options
Economies-of-scale
Ecosystems creating economic value
Cloud represents:
The industrialization of delivery for IT supported services
Multiple types of clouds will co-exist:
Private, Public and Hybrid
Workload and / or Programming Model Specific
[Workload point – workloads with high affinity for this model will be the first to move to cloud.]
Everyone is interested in the economics of cloud, but that is not sufficient for others. They are interested in how this model will differentiate them in their industry. This is not an evolution of the back office or an IT concept, it is a business model concept.]
Why cloud now?
First, I don’t think anyone at this point misses the fact that we are at in inflection point with regard to enterprise IT.
This crisis of IT complexity and inefficiency is clear, but the issue has become even more pointed in the context of a global economic crisis. This has caused clients to take a hard look at challenges growing within their IT infrastructure.
The instrumentation, intelligence and interconnectedness of devices, people and nature is creating an information explosion that is driving new innovations, and new insights. It is these insights and innovations that are helping CIOs face the change and challenges needed to best support the business, and it is the need for insights and innovation that is keeping the CIO up at night.
What is cloud?
Given these pressures on current IT environments and data centers, IT executives are looking for a new model – and cloud computing has emerged as an interesting option. But the buzz surrounding cloud is based mostly on a new kind of user experience – particularly in the consumer Web space – for search, social networking and retail. From the consumer perspective, cloud computing is a means of acquiring services without needing to understand the underlying technology. Many of us use cloud delivery models everyday without knowing it when we share photos online, download music or access your bank account on your mobile phone.
From a technology perspective, we think about cloud as both a new consumption and delivery model. Cloud represents a massively scalable, self-service delivery model where processing, storage, networking and applications can be accessed as services over the Internet. And we believe enterprises will adopt cloud models to improve employee productivity, deploy new products and services faster and reduce operating costs – starting with workloads that are ripe for this environment, including: development and test, virtual desktop, collaboration and analytics.
But in order to get the economics and flexibility clients’ desire from a cloud environment… virtualization, automation and standardization must all be implemented.
Benefits/ Economic Levers
But regardless of definitions, what is really getting attention is the potential benefits from a cloud environment. CIO’s are operating in an interesting environment – you need to support innovation and speed up time to market for new products and services – all the while reducing your budgets.
And you have both Infrastructure and Labor levers to help drive down cost.
Infrastructure:
Virtualization of hardware drives lower capital requirements
Better utilization of infrastructure through virtualized environments get benefits of scale
Labor:
Clients who can “serve themselves” require less support and get services
Automate repeatable tasks
And the standardization of workloads means more complexity = less automation possible = people needed
Workloads
By definition clouds are workload specific and need to be highly optimized to the work. For example, different workloads have very different architectural characteristics – think about how. Google is optimized for search or massive reading, Amazon for web displaying, and Salesforce for a heavy multi-tenant environment. Those areas that have a high degree of affinity with the cloud model – technically and from a risk/reward perspective – include Infrastructure as a Service and Software as a Service solutions. Workloads that clients are adopting now include test and development, desktop, collaboration, storage, compute and analytics. All of these are highly standardized….the more standard the environments the better the economics are going to be. There are other workloads that will never move to the cloud due to regulations, criticality, or security concerns.
Delivery Choices
When it comes to delivering a cloud deployment there is a spectrum of deployment options available for you to choose from. The most common and written about is the public cloud option like Amazon Elastic Compute Cloud (EC2), or Google Apps. These cloud deployments allow any user with a credit card to gain access to the resources. To a private cloud deployment where all the resources are owned, managed and controlled by the enterprise. To gradations in between from third party managed, to third party hosted, to a very common emerging model called “shared cloud services” or “member cloud services.” Here you must be a member to access the services, and they can be made available to you typically in a shared resources option or a dedicated resources option, depending on your needs and configurations. It is this last model where IBM has offerings call IBM Smart Business Services on the IBM Cloud.
Finally, you can merge the options between public and private and create what has been coined a “hybrid cloud”. A Hybrid cloud solution is some mix of private and public integrated with your traditional IT to deliver the cloud solution to the end user and can involve any of the public to private options.
We know that no one cloud model is best for any one business. Most businesses need a mixture of public, private and hybrid cloud services, and that mix not only changes by company, but within a company as business needs change. That’s why IBM has flexible, scalable deployment models that can be tailored to your organization, with different administration options to help manage cloud services.
IBM Confidential 12 12

13. IBM uses cloud computing to meet internal and external challenges and opportunities, saving millions of dollars
Analytics
Collaboration
Development and Test
Desktop
Storage
Business Services
Fit for purpose middleware platform
Common Compute Platform
(Compute/ Network/ Storage)
Base Enterprise Platform
Blue Insight: Smart Business Analytics Cloud
109,000 IBM users growing to 200,000
LotusLive
Handling 75% of all IBM web conferencing
CIO Dev/Test Cloud
Build time for dev/ test environment from 1wk to 1hr
Clients reduce labor costs 30-50%
Workplace Cloud
Estimated savings up to 30%
1200 China Dev Lab users plus Call Centers
Network Storage Cloud
Up to 40% savings in storage costs
Production Cloud
1,000 applications identified
[And IBM is eating its own cooking]
Clients have the benefit of IBM having experimented on ourselves already.
We have implemented cloud capability internally to get proof points on the benefits clients can reap
Analytics
We announced this capability externally as the world’s largest private cloud computing environment for business analytics, called Blue Insight – the basis for the Smart Business Analytics Cloud offering
Blue Insight provides IBMers globally with insight to better meet the needs of clients worldwide as well as pursue internal growth and productivity opportunities.
Blue Insight provides a single entry point to information from nearly 300 different information warehouses and data stores, providing analytics on more than a petabyte of data.
More than 130,000 IBMers will have access to Blue Insight in 2010; currently with over 109K users, 35 ported applications and another 30 applications are the pipeline for deployment toward our full-year user deployment goal. We expect to realize tens of millions of dollars in savings over 5 years through deployment of Blue Insight.
Collaboration/Lotus Live
IBM adopted LotusLive Meetings last year as our primary web conferencing capability for meetings among IBMers, clients and business partners. In 2009 the total number of meeting minutes grew to over 200 million minutes.
The adoption rate of LotusLive for meetings has been fast – with 75% of IBM’s current meeting minutes provided through LotusLive
IBM is also piloting the use of LotusLive Engage with 6000 registered users sharing files, internally and with clients.
IBM intends to adopt LotusLive iNotes for a targeted segment of the population.
Strategically, we intend to expand our LotusLive footprint to support other collaborative requirements (e.g. file sharing, social networking, instant messaging, etc).
Development/Test
The IBM CIO Develop/Test cloud went into service last September, supporting the Power and x86 platforms, with over 500 provisioning transactions to date (new & decommissions).
Implemented with the GTS Smart Business Test Cloud method, provisioning transaction times went from 5 day SLA, to just over an hour.
Other automated/self-service functions:
Automated approval within preset monthly spend limit
Self-service purchase of optional support services for all image software components
Self-service change of virtual server configuration and support
Lower setup cost. Easy tear-down. Transparent usage-based billing
Expected higher dev-test productivity (enablement of more agile methods)
Web application middleware stacks supporting 50% of our test activity were enabled first (WAS/DB2/MQ/Apache his), with additional work underway this year to cover 80% of our develop/test activity.
In addition to productivity & cost savings, this capability is a key enabler for our internal development transformation (GenO/Liquid), through services like Topcoder.
Client results we're yielding from dev/test cloud implementations.
Reduced IT labor cost by 50% in configuration, operations, management and monitoring.
Improved capital utilization by 75%, significantly reducing license costs.
Reduced provisioning cycle times from weeks to minutes.
Improved quality, eliminating 30% of software defects.
Reduced end user IT support costs by up to 40%.
Desktop
Over 1200 users in our China Development Labs have been moved into a private desktop cloud.
Using the Smart Business Desktop Cloud, our IBM Call Center teams are moving roles to desktop clouds, with initial group migrations this year in the US and India.
Estimated savings opportunity ranges from 20% to 30% of the current client provisioning costs (est $90-100M), with additional security benefits & improved systems management.
Role-based segmentation work is underway to identify more internal groups that can benefit from the security and performance characteristics of desktop cloud architectures.
Reference architectures for desktop clouds are not “one size fits all” and based on segmentation (end user personas, usage patterns and business requirements) we are learning to apply the best solution to meet the cost and performance goals.
Storage
IBM faces YTY growth rates of nearly 25% in our file and block storage spaces, similar to industry. We're working to drive higher utilization and storage management automation.
For file storage IBM is working on ways to implement the Virtual Storage Cloud offering, which aims to provide file and object storage.
For block storage IBM focusing first on the midrange & zLinux support technology, like XIV, and cloud automation.
Estimated savings opportunities for these spaces currently range around 30-40%.
Production
IBM is assessing its production portfolio for applications that can take advantage of Cloud characteristics.
So far, about 1000 applications have been identified from our portfolio that are suitable for a cloud environment, and plans are in place to move number of those into a cloud environment this year.
Using methods developed by our services teams, starting with our non-mission critical applications, we'll refine the value proposition for use with our other production workloads.
All of these measures will create millions of dollars in savings for the IBM Corporation.
IBM Confidential

14. Cloud enables global industry transformations – Creating new centers of economic activity fueled by an information supply chain
Industry Services
Industry Services
e-Commerce Services
Demand Replenishment Services
Medical Image Archive Service
Public Health Services
Clinical Development Services
Collaborative Health Care Services
Industry Vertical Business Services
Workload Optimized Industry Cloud Platforms
On a platform of robust Infrastructure Services
Additional Industry Cloud Platforms
Retail Industry Cloud Platform
Healthcare Industry
Cloud Platform
[This is the future. It’s where cloud goes from being a cost debate to an innovation debate.]
So far, we’ve just talked about the plumbing of cloud – stuff we all love to talk to each other about. But in addition to providing more effective and efficient delivery of IT capability, there are also emerging use cases that leverage cloud capabilities to deliver Industry vertical cloud business solutions.
So if you believe that what we’ve discuss is true, then you’ll see where digital and physical infrastructure will converge is around industry spaces. Clouds will be the delivery engine for the emerging industry systems. For healthcare, there will be an industry platform on which applications and services can be delivered for medical image archives; public health services; clinical development services; collaborative care. Or retail can have a cloud platform for e-commerce services and demand replenishment. All of these environments will have a robust infrastructure foundation of compute and storage clouds.
Let me give you a few examples:
Smart Healthcare.
According to the World Health Organization there are over 4 million too few doctors, nurses and support workers to meet existing demand
And just in the United States, 1 out of 10 Americans suffer from chronic disease, and about 70 percent of all health care expenditures are related to these illnesses. Imagine what that looks like in emerging markets.
As we begin to look at healthcare and other industries as true “systems”, we will take a different approach to solving what are systemic problems and managing the order of magnitude greater load on IT.
Let’s take collaborative care. Here we are talking about connecting doctors, nurses, pharmacists, therapists and others providing care work at many levels -- from active wellness management through mobile devices, to remote management of chronic disease.
In parts of North and South Carolina as well as Southern Virginia, sharing patient information is already paying dividends. New data shows how the WNC
Health Network, one of the first Health Information Exchanges in the nation, received an ROI of 123% in just three years; 40% efficiency savings from faster record access and a 20% reduction in the cost of sharing and transferring patient records. Hospitals in the network are also saving roughly $872,782 per year on reduced medical errors. Working with IBM, the 16 hospitals and 23 affiliates that make up WNC Health Network are building a system for smarter healthcare, making it easier for the network’s 1,200 doctors to spot problems like prescription drug misuse, recurring ER visits, and to analyze trends among chronically ill patients to keep them healthier. That system could easily be extended to pharmacies or patients in the future. More than $564 million in US stimulus funds will go to the creation of health information exchanges (HIE) within and among states. And since 80 percent of all healthcare is delivered locally, these new systems for sharing patient health records should help hospitals and doctors connect and work together, providing easy access to patient files, test results or even medical images like x-rays and CAT scans.
Denmark – Collaborative care – Wellness cloud…monitored and sensed through devices, analyzed in a central locations…and constructing a common information model to get meaningful insight for the individual, disease tracking and research (future looking statement).
These are just a few examples, but the trends are similar across all industries; and impacting virtually every system inside a company, a city, the world.
If you really understand where the technology is going, it is moving out of the back office and into the front lines and into the core business of every organization.
IT departments will process more transactions and manage exponentially more data. Yet they will need to do it more efficiently than ever, consume less energy, and make the most of the existing floor space.
We believe that to address the demanding requirements of emerging, data-intensive workloads, what’s needed is a four-fold increase of computational power every two years. That means over ten years – it’s an exponential increase – a factor of 1000.
The possibilities are endless as industry and business models continue to transform and the internet of things becomes an internet of services.
Compute and Storage Clouds
Enterprise-class Infrastructure Services
IBM Confidential

15. Intelligent Transportation Systems
Integrated transportation solutions:
Road user charging
Congestion pricing
Integrated fare management
Benefits:
Reduce traffic congestion
Reduce CO2 emissions
Increase mass transit usage
Improve environment
Stockholm case study with clear results:
Reduced traffic congestion 25%
Reduced carbon emissions 15-40%
$120M/yr in revenue to City, 4 yr payback
Congestion charges fund transit improvements
Wherever you begin, IBM can help.
Whether it’s energy efficient technologies and services, or applying information technology to telecommuting opportunities, transportation challenges, smart grids, carbon management, water management, or looking for research and development focus on alternative energy, IBM is ready to help.
IBM Confidential

16. Intelligent Utility Networks
Smart Grid Solutions:
Smart grid management
Smart meters
Smart appliances
Smart integration
Real-time energy market
Dynamic response to constraints on the grid
Benefits in PNNL case study
Reduced peak load demand on the energy grid 15% to 50%
Reduced consumer energy bills by 10%
Pacific Northwest National Lab (PNNL)
Shadow Market
PNL Application Web Server
Energy Market
Invensys Application/ Web Server
Internet
IBM: Event Bus & Event-based Programming Model
125 Residential Homes
Application Server
Invensys Home Gateway
Control/ Application Server
LCM
GFA
Meter
Load Shedding
Heat Storage
Dryer
Thermostat
Additional DR
Wherever you begin, IBM can help.
Whether it’s energy efficient technologies and services, or applying information technology to telecommuting opportunities, transportation challenges, smart grids, carbon management, water management, or looking for research and development focus on alternative energy, IBM is ready to help.
LCM
150 & 350 KW
Power Generator
Water Heater
Space Heater
600 HP Water Pump
Residential Home
PNL
Port Angeles Water Supply
IBM Confidential

17. Smarter Water Management
Strategic Water Information Management Solutions – SWIM
Sensing and Monitoring
Data Integration, Workflow, Management
Deep Thunder – Advanced Micro-weather prediction
Storm Impact and Response Prediction
IBM Advanced Water Management Centers of Excellence
Amsterdam, Netherlands
Dublin, Ireland
Benefits
Flood forecasting, predictive modeling
Environmental analysis & prediction
Reduced water usage and costs
IBM case study: 27% reduced water usage, 30% increase in manufacturing output, saving $M in energy and water
REON- River & Estuary
Observatory Network
Wherever you begin, IBM can help.
Whether it’s energy efficient technologies and services, or applying information technology to telecommuting opportunities, transportation challenges, smart grids, carbon management, water management, or looking for research and development focus on alternative energy, IBM is ready to help.
IBM Confidential

18. “If you can measure it, you can manage it”
Green Sigma™ grew from IBM’s deep internal experience in facilities and manufacturing process improvement
Green Sigma™ is aimed at reducing energy & water, waste generation and CO2 emissions throughout a company’s operations, resulting in:
Lower environmental impact
Increased efficiency
Reduced costs
The key components are: 1
Metering and Monitoring 2
Management through the Green Sigma™ Dashboard 3
Applied Statistical Techniques
“If you can measure it, you can manage it”
IBM Confidential

19. The Green Sigma™ Dashboard for Energy proactively monitors KPI data, alerts and trends, and enables drill-down analysis…
IBM Confidential

20. Similarly, the Green Sigma™ Dashboard for Water monitors KPI data, alerts and trends to drive Water related benefits
IBM Confidential

21. What are smarter buildings
What are smarter buildings? Smarter Buildings are well managed integrated physical and digital infrastructures that provide optimal occupancy services in a reliable, cost effective, and sustainable manner.
Smarter Buildings…
Are more cost effective by reducing energy and operating costs.
Use active and designed-in techniques to achieve efficiency and environmental responsibility.
Have the ability to interact with occupants inside them as well as the environment around them.
Maintain a safer and more secure workplace.
Communicate in real-time to supporting infrastructure ( i.e. smart grid, broadband, etc.).
Before we go further, what is the definition of a Smarter Building?
It is a building that is managed comprehensibly from design to demolition; it is equipped with the right instruments and systems to enable monitoring and optimal operations; it is integrated with the utility smart grid to take advantage of time-of-use electric rates, and to minimize consumption during peak hours; it is capable of producing at least part of its energy needs; it captures rainwater and minimizes wastewater; and most importantly, it has user interface tools to keep the occupants aware of the real time parameters of the building and to empower them to impact those parameters.
IBM Confidential

22. How does a building become smart?
Portfolio
Estates Mgmt
Fire
Functionality checks,
Detector service
Water
Smart Meters,
Use / Flow Sensing
HVAC
Fans, Variable Air Volume, Air Quality
Elevators
Maintenance, Performance
Access/Security
Badge in, Cameras, Integration
Perimeter, Doors, Floors, Occupancy
Lighting
Occupancy Sensing
24/7 Monitoring
Condition Monitoring, Parking Lot Utilization
Energy
Smart Meters, Demand response
Community Services
Transportation, Traffic, Events
Utilities
Demand Mgmt,
Cost Control
Weather
Current
Predictions
Emergency Services
Alerts, Actions
Commercial Potential
Advertisement
Asset Mgmt
Lifecycle
Energy Use
Passive/Active
Analytics and Optimization
Building Services
Maintenance
External Integration
Occupancy
Space Mgmt
Tenant Services
Help Desk
Going back to the theme of Instrumented, Intelligent and Interconnected…
The middle portion of the chart represents the various sensors and controllers that make up the Instrumentation layer. Critical building related data from the Instrumentation layer is aggregated, consolidated and correlated and fed to the “Intelligent layer” on the left side of the chart.
The Intelligent layer then uses the data feeds to gather insights into the operation and performance of the building and based on ‘best practices’ and business rules provides optimization recommendations for the efficient operation of the building(s).
Some of these optimization and operational decisions are based on not just the internal data generated from the Instrumented layer but also on external criteria like weather patterns, emergency operations, Smart Grid, government mandates etc. (on the right side of the chart) which illustrates the interconnected nature of today’s operational needs.
and as a lead in into Slide 8, we could see something like..
Speaking of interconnected systems , some of these interconnected systems like Smart Grid are intelligent systems on their own and in the context of Smarter Cities there is an increasing need to connect them to buildings..
Waste Mgmt
Trash/Water/Recycle
Compliance
Environmental reports
Voice/Video/Data
Industry Specific Hospital, hotel, etc.
Integrated Building & Communications Services
IBM Confidential

23. What does it mean to be a Smarter Building
What does it mean to be a Smarter Building? The interconnection of physical assets and information technology can optimize efficiency, production and consumption in many types of buildings.
Smarter Commercial Building
Smarter Cell Tower
Provides integrated facilities operations information for owners/operators in order to optimize energy usage and services based on tenant’s needs.
Integration of active and passive management enables optimized operations to reduce truck rolls.
Smarter Data Center
Smarter Campus
PEHV = plug in hybrid vehicle
Integrated facilities and IT insight to energy efficiency of datacenter and the correlation of IT and facilities information.
Intelligent infrastructure platform and tools to manage plug-in electric vehicle stations, buildings, badging, central utility plant
IBM Confidential

24. What does it mean to be a Smarter Building
What does it mean to be a Smarter Building? The interconnection of physical assets and information technology can optimize efficiency, production and consumption in many types of buildings.
Smarter Hotel
Smarter Airport
Integration of all the guest subsystems of hotel that welcome guest according to their preferences and adds to convenience during stay.
Provides efficient passenger and cargo services, climate control, wi-fi access, track maintenance tasks and help achieve security and safety compliance
Smarter Hospital
Smarter Government Building
Sensor instrumentation used in real-time for asset location and automated workflows such as medical equipment maintenance.
Utilize fully serviced office hubs and mobility tools to improve public services. Match occupancy levels with portfolio wide estates data to optimize building utilization.
IBM Confidential

25. Smarter Buildings applications and benefit examples.
SMART IS
Holistic energy mgmt that enhances the efficiency of buildings and other assets.
SMART IS
Integrated communications and building services that support intelligent operations.
SMART IS
Integration of energy and asset management to lower operating cost.
St. Regis Hotel: Designed for 4.9% energy cost to revenue compared to average for 5 star hotels average at 8%. Reduced energy cost / revenue 40% vs. similar 5 Star hotels.
Saint Barnabas Medical Center:
Improved asset utilization and staff response times by 90%. Reducing overhead paging by 94%. Enhancing HCAHPS scores by eliminating communication barriers between care teams and patients.
Ave Maria University:
Converged 23 systems to single IP network. Integrated JCI Metasys with IBM Maximo. Saved $1M in building costs and $350K/yr in combined operating costs.
HCAHPS is U. S. Department of Health and Human Services rating systems of hospitals. Hospital Consumer Assessment of Healthcare Providers and Systems Survey.
IBM Confidential

26. Self check in / check out Kiosk Electronic Peephole
China Hangzhou Dragon – Smart Hotel Reference
Integrating more than 20 sub-systems using IBM’s integration skills and latest technology.
“In the hotel industry, technology can make a real difference by significantly enhancing the customer experience and maximize their comfort and satisfaction," said Eric Du, General Manager, Dragon Hotel. "Through the cooperation with IBM, Dragon Hotel would be able to build a Smart Hotel system to improve significantly the operational efficiency and productivity, the response time to client demands, and most of all, the client experience."
Self check in / check out Kiosk
Equipped with Passport / ID reader
Equipped with Hotel key card dispenser
Saves time for client for check in/out
Electronic Peephole
Better views of hallway
Connect directly to the TV in the guest room
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27. Smarter Building Entry Points and Value
Initial focus areas on expense / efficient operations
Maximo: facilities and asset management integrated with energy management
Integrated Communications Services, Green Data Center
Property Performance Management Solution, Asset Management and Asset Analytics including portfolio analysis
Aggregation and analysis of data across multiple buildings – performance management dashboards, building data visualization, real-time monitoring
IBM's Green SigmaTM coalition – partnerships to integrate the physical and digital infrastructure
IBM Confidential

28. Carbon Reporting and Trading – Cap and Trade Systems
Players and participants
Government
Exchanges
Brokers
Enterprises and Utilities
Carbon Credit Creators – CC&S
Evolution
EU Emission Trading Scheme
Asian interest
US evolving – voluntary, regulated, regional, national?
Solutions today for Carbon reporting software
Potential benefit: Reduced GHG emissions
Government
Creates and regulates the scheme
Exchanges
Enterprises
Run the Trading platform
Manage and Report Carbon Emissions
Wherever you begin, IBM can help.
Whether it’s energy efficient technologies and services, or applying information technology to telecommuting opportunities, transportation challenges, smart grids, carbon management, water management, or looking for research and development focus on alternative energy, IBM is ready to help.
IBM Confidential

29. Smarter Cities Bring it All Together – with intensive use of information technologies for sustainable developmnet
Public Safety
- Smarter Surveillance Systems
Emergency Management Integration
Micro-Weather Forecasting
Cyber-security
Intelligent Transportation Systems
Road Usage Charging/Congestion Pricing
Integrated Fare Management
Traffic Information Management
Telecommunications
Fixed and mobile operators
Media Broadcasters
Energy Management
Smarter Building Management
Automated Meter Management
- Smart Grid – Demand Management
Energy Network Monitoring & Stability
Proactive management of the alternative energy mix
Environmental Management
City-wide Measurements
Key Performance Indicators (KPI’s)
Energy, Water, Waste, CO2 Management
Scorecards
Reporting
Water Management
Water purity monitoring
Water use optimization
Waste water treatment optimization
IBM Confidential

30. Energy Management in a Smarter Planet
The interconnection of physical assets and information technology can optimize energy production, efficiency and consumption
Smarter Buildings Integrated and optimized physical and digital infrastructures to create cost effective and operationally efficient buildings and micro grids – energy, water, waste, GHG management
Homes
Energy and Water Management - Central control and connection of home systems - electronics and community micro grids
Industrial Plants
Appliances
Automatically adjust power usage based on grid status
Meters
Digital link with power company to enable energy optimization and time-of-use savings
Commercial and Government Buildings
Distribution Company
Distribution management
Energy supply chain
Network operation
Electric Company
Customer account management
Time of use management
Energy management
Central Power Plant
Intelligent systems , such as the smart grid, will deliver the complex ecosystems of tomorrow (many of which are already here today).
As the world gets smarter - more instrumented, interconnected and intelligent. These smart assets are converging with conventional information technology to form revolutionary new ecosystems that are permanently changing how we work, live and play. In a trend that presents significant new opportunities and challenges for both manufacturing and IT companies, physical devices are being interconnected with backend software applications to deliver new, often radical “systems of systems,” like the smart electric grid.
The challenges of delivering a intelligent system?
Unprecedented challenges
Multiple systems, infinite lifetime, uncertain boundaries and information flow
Multiple stakeholders’ evolving needs across periods of time that exceed the lifetimes of its individual systems
Backward and forwards compatibility
Develop optimal operational and system architectures
Trade-off analysis and risk management
Interconnection of physical devices and IT systems into robust integrated systems
Clear communication and management of project requirements and constraints
Operational management
Services, security, network, Cloud
Vehicle Charging
Smart charging of hybrid & electric vehicles at home and at commercial locations
Solar and Wind Farms
Energy Exploration, Production and Generation –
Coal, Oil, Gas
Nuclear, Hydroelectric
Solar, Wind, Geothermal
IBM Confidential

31. IBM Energy and Environment Research
Leverage know-how in thin films, semiconductors, silicon, materials science, cooling for photovoltaics including concentrator photovoltaics
Energy Storage Research – Lithium/Air
Nanomembranes for Reverse Osmosis filtration of salts and other toxins from water for desalination
Modeling analytics for optimization in energy efficiency and renewable energy
Cyber-security research and development
IBM Center of Excellence for Nuclear Power in LaGaude, France
Big Green Innovations
As part of our Big Green Innovations program, we are leveraging network intelligence and management capabilities from related areas, such as Utilities and Transport Infrastructure, and applying them to Water Management.
In addition, through IBM Research, we are investing to leverage our leadership in nanotechnology to help reduce the product and manufacturing costs for photovoltaics.
IBM Confidential

32. IBM has a long history of environmental tradition and leadership.
2006: Amount of IT product and product waste processed by IBM’s product End-of-Life Management operations that was reused or recycled
1990: Think! Devoted an entire issue to IBM’s environmental programs – beginning IBM’s annual Corporate Environmental Reporting
96%
2006: IBMers “Jam” on innovation for a better planet, and IBM invests in Big Green Innovations
1991: Established IBM’s Product Stewardship Program
1997: IBM becomes the first major multi-national to earn a single global registration to the ISO environmental management system standard
1976: Think!, the company magazine, devoted an entire issue to IBM’s energy conservation and environmental programs
: Between 1990 and 2006, IBM’s global energy conservation actions reduced or avoided CO2 emissions equal to 44% of its 1990 emissions
44%
: Reduction in hazardous waste generation since the 1987 base year of this pollution prevention metric
2007: Invested in Intelligent Utility Networks, Intelligent Transportation Systems, Project Big Green
95%
1971: T. J. Watson Jr. issued IBM’s first corporate policy on environmental protection
1992: IBM becomes charter member of Energy Star Program
1994: Established Global Materials Recovery Center Network for product re-use and recycling
IBM has a long history of Environmental Tradition and Leadership
IBM’s first corporate environmental policy was established by its CEO in 1971, followed by a corporate energy conservation policy in 1974.
The IBM environmental policy is supported by a Global Environmental Management System (EMS) that governs IBM’s operations worldwide to the same environmental requirements and standards.
IBM was the first company to earn a single global registration to ISO (1997), thanks to the above-noted global EMS that covers all intersections between IBM and the environment
We have publicly disclosed environmental performance each year since 1990 via a voluntary corporate environmental report
Our documented baseline for energy conservation and CO2 emissions reduction goes back to From 1990 through 2006, IBM’s energy conservation actions: conserved 4.5 billion kWhrs of electricity; avoided approximately 3 million metric tons of CO2 emissions (equivalent to 44% of the company’s 1990 emissions); and saved $290 million.
Notwithstanding its significant early action and results, IBM has established a "next generation" CO2 emissions reduction goal: to further reduce CO2 emissions associated with IBM's energy use by 12% between 2005 and 2012 based on conservation, use of renewable energy, and/or funding renewable energy credits.
We led in voluntary efforts to reduce PFC emissions from semiconductor manufacturing: first semiconductor manufacturer to announce numeric goal for reducing PFC emissions (1998); and reduced PFC emissions 55% from
We significantly increased procurement of renewable energy from 11 million kWhrs in 2001 to 368 million kWhrs in 2006 (7.4% of IBM’s global electricity purchases)
IBM was a pioneer of employee telecommuting and work-at-home programs: Conserved approximately 8 million gallons of fuel and avoided over 68,000 tons of CO2 emissions in the U.S. alone in 2006.
1989: IBM offers its first product take-back program
Collaborating to develop solutions …
IBM Confidential

33. IBM’s Commitment to Energy Efficiency – Actions and Results
IBM develops and deploys Green projects to save Millions of $ per year
Green IT
Green Datacenters
Smarter Buildings
Smarter Water Management
Smart Grid
Renewable Energy
Between 1990 and 2009, IBM saved over $370M through energy conservation actions
Saving 5.1 B kWh of electricity consumption
Avoiding nearly 3.4 million metric tons of CO2 emissions
Annual energy conservation/efficiency goal is 3.5%+ per year
First established IBM Corporate Policy on Energy Conservation in 1974
In 2009, IBM energy efficiency projects saved 5.4% energy use and $27M in energy costs

34. The Green Sigma™ Coalition
Working together to co-create a Smarter Planet, Smarter Cites, Smarter Buildings
Accelerating the move toward sustainable enterprises
Collaborating on showcase projects to drive quick ROI & continuous improvement
Enabling public & private enterprises to reduce energy, water, waste and GHG Emissions… across the value chain. Saving money, time and resources.
Strategic Intent
Accelerate the move toward sustainable enterprises through implementation of high value projects which enable an entity to reduce energy, water, waste and GHG Emissions.
Publicize outcomes and encourage a mindset of possibility
Value Proposition
We leverage existing client infrastructure and technology where possible to accelerate time to savings
We quickly assemble existing skills, technologies & capabilities across multiple companies to drive practical results and savings
Climate and Culture
The coalition is a structure which enables experiments in the concept of "co-creation".
Coalition members will learn together, and evolve the coalition itself, as well as membership, our engagement approaches and solutions.
2009 Business Priorities
Implement & promote Green Sigma™ showcase projects which reduce water, energy, carbon emissions and/or waste in 2009 (minimum of 1 per coalition member, funded by coalition member or joint client)
Jointly work to define maximize client investments & Coalition Member Capabilities via Solution Mapping worksessions – based on real client needs
Integration of relevant Green Sigma™ Coalition member products/services/technology into an open integration framework for flexibility and quick time to savings
Building on success in data center with ITM for Energy Management to capture Green Sigma data from coalition member systems whenever possible
IBM Confidential

35. Florence D. Hudson fdhudso@us.ibm.com
IBM Confidential