Boosting Small Business Profits Through Sustainability

As markets intensify and industries evolve, sustainability has transcended mere environmental considerations to become a crucial driver of business success. Small and medium-sized businesses (SMBs), in particular, are discovering that building a sustainability strategy not only aligns with ethical responsibilities but also unlocks significant advantages that contribute to their growth and profitability. Moreover, sustainability initiatives can open doors to new opportunities, including improved access to capital through investment programs and grants that prioritize businesses committed to upholding Environmental, Social, and Governance (ESG) standards.

So what does this have to do with low level architecture? As solutions architects, we find that customers who are thinking about their infrastructure from a sustainability point of view, are in tandem unlocking deeper mindfulness about resource utilization and as a result, realizing cost savings. Amazon Web Services (AWS) strives to guide customers through a best practices framework called the Well-Architected Framework, of which sustainability and cost optimization are both key pillars because they are inevitably intertwined. In this blog post, we will share how the best practices for the sustainability and cost optimization pillars of the Well-Architected Framework share surprising commonalities in their architecture approaches.

The AWS commitment to sustainable business at all levels of the IT stack

First, it is important to understand the connection between sustainability and cost optimization at a hardware level. AWS operates on a Shared Responsibility Model; AWS takes responsibility of sustainability at the hardware level, and customers can achieve sustainability in their architecture choices. In 2024, AWS published a joint study with Accenture around the sustainability metrics of on-premises versus AWS deployments. They analyzed operational carbon emissions and embodied carbon emissions (hardware components) across simulated on-premises and AWS deployments for a representative storage-heavy workload and compute-heavy workload. They found that today, AWS servers are designed to use up to 20 percent less energy than traditional servers. AWS data centers were also found to be 3.6 times more energy efficient than the average U.S. enterprise data center surveyed in the study. AWS’ comprehensive approach to carbon reduction includes leveraging cloud computing efficiency, investing in renewable energy, sustainable building strategies, and enabling customers to adopt sustainable business practices. And with this heavy investment in increasing energy efficiency at the hardware level, AWS can derive cost efficiency for its end customers as well.

Cost optimization and environmental optimization: the parallels

As organizations look to improve their bottom line and reduce their environmental impact, it’s becoming clear that the business strategies for cost optimization and environmental optimization often go hand-in-hand. By adopting initiatives that drive efficiency and flexibility, businesses of all sizes can realize significant benefits in both areas.

1. Scaling and agility:

   One of the clearest parallels is in the realm of scaling and agility. Cost optimization strategies frequently revolve around the ability to scale resources up and down as needed, avoiding the pitfalls of over-provisioning. This same approach has major environmental benefits. By leveraging serverless architectures and services like AWS Lambda, organizations can confirm that compute resources are only used when required, rather than having energy-hungry infrastructure sitting idle. This not only helps you save on costs, but also dramatically reduces the carbon footprint of a workload.

2. Migrating to the cloud:

   A similar dynamic emerges when looking at the tradeoffs between on-premises and cloud infrastructure. While on-premises setups may have lower initial costs, the pay-as-you-go model of cloud providers allows for much more efficient scaling. This optimization not only saves money, but also significantly reduces energy consumption and greenhouse gas emissions. In fact, customers can see carbon emissions reductions of up to 93 percent by moving storage-heavy workloads from on-premises to AWS, with an additional 47 percent reduction possible through architectural modernization on AWS.

3. Mindfulness with generative AI:

   The rise of generative artificial intelligence (AI) and large language models (LLMs) presents another interesting intersection of cost and environmental optimization. These AI workloads are incredibly resource-intensive, demanding massive amounts of compute power, memory, and storage. Organizations deploying these technologies must carefully assess their underlying technical infrastructure, architecture, and operational model to confirm they can handle the high computational demands while keeping costs and energy consumption in check.

   By optimizing factors like data efficiency, algorithm design, infrastructure utilization, and hardware efficiency, companies can make significant strides in both cost savings and environmental impact. Thoughtful governance around the deployment of these AI models is also crucial, as uncontrolled proliferation could lead to spiraling costs and unsustainable energy usage.

Ultimately, the common thread between cost optimization and environmental optimization is the drive for efficiency and flexibility. Whether it’s serverless computing, cloud migration, or AI infrastructure, the strategies that allow businesses to scale resources dynamically and eliminate waste are the ones that deliver the greatest benefits – both to the bottom line and to the planet. By aligning these two critical priorities, organizations can unlock a virtuous cycle of savings and becoming a sustainable business.

Sustainability initiatives: good for business

Greenko Group, a leading renewable energy provider in India, was able to realize significant gains from embracing sustainable practices and leveraging cloud technology. As a rapidly growing business, Greenko sought ways to improve operational efficiency and reduce its environmental impact.

By migrating its infrastructure to AWS, Greenko was able to optimize its energy usage and realize substantial cost savings. The scalability of the AWS Cloud allowed Greenko to provision resources on-demand, rather than maintaining costly on-premises data centers. This not only lowered the company’s capital expenditures, but also reduced its carbon footprint.
The combination of cloud optimization and Internet-of-things (IoT) driven insights allowed Greenko to deliver affordable, clean energy to its customers while also bolstering its own profitability. As Greenko’s chief sustainability officer remarked, “Sustainability is not just good for the planet—it’s also good for business.” The company’s success story demonstrates how SMBs can leverage technology to drive both environmental and economic benefits.

By achieving business sustainability, SMBs can unlock a virtuous cycle of cost savings, enhanced brand reputation, and a reduced environmental impact, positioning themselves for long-term success in an increasingly eco-conscious market. Take the first step towards a more sustainable future for your business, learn about the top technology sustainability use cases for Small and Medium Businesses. Explore the AWS Customer Carbon Footprint Tool and AWS Sustainability Training today to measure your impact and develop the expertise needed to drive meaningful change.

Ready to take the leap but unsure how to start? If you have technical expertise, sign up for a free AWS account. Seeking inspiration for your first project? If you work in a less technical role, learn how other SMBs are using AWS. For expert help, schedule a consultation or use the AWS Partner Network to discuss your project needs.