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Why IT matters more, to more people, than ever
February 07, 2008

It’s been five years since Nicholas Carr, editor of the Harvard Business Review, wrote a now infamous article, "IT Doesn't Matter". Most technology vendors and indeed plenty of analysts took umbrage at this assertion, but was Carr right then, and is he still right today?

First we need to establish what Carr actually said. He said that what he calls "infrastructural technologies" would become ubiquitous in the not-too-distant future. As he puts it, "as their availability increases and their cost decreases - as they become ubiquitous - they become commodity inputs."

But is becoming a commodity the same as no longer mattering -- of no longer holding any importance? I believe that Oracle’s acquisition of BEA for $8.5bn is just one proof-point for the fact that infrastructural technologies are anything but commodity.

Not only do they still matter, they matter more and more to companies for whom integration – between data, systems and applications – is the biggest thing holding back many strategic projects.

Carr is right that there is constant evolution in all areas of technology, and that technologies that once held competitive advantage become a little less of a differentiator once they are readily and cheaply available to all.

But even with technologies that have become commoditised by virtue of being cheaply and readily available, there is still the question of exactly how those technologies are applied. Even the best tools, if not woven successfully into the fabric of a firm’s business processes, have the potential to do more harm than good.

For example, a survey a couple of years ago of 600 employees at blue chip companies in the UK by Priority Management, found that 11% of employees consider email to be the cause of most disruption to their working day. But for many other staff, email clearly has the ability to dramatically boost productivity.

The other thing that Carr underestimates is the pace of change in IT. IT is not static. There are constant inventions, improvements and combinations of existing technologies that once again create the potential to boost competitive advantage. For every technology that Carr would say has become commoditized, another is around the corner that only early adopters will benefit from.

When Carr wrote his paper about infrastructural technologies becoming commoditised, for instance, the Enterprise Service Bus and the SOA Registry/Repository were just emerging. Today they are far more mature and perhaps even to some extent commoditised, yet they still matter to those who have built their SOA infrastructures around them.

As for technology as a whole, I believe it matters more, to more people, than ever. Here's why...


...Consumers at home now care about the ease of use and speed of wireless networks, synchronization between portable devices and their PCs, and remote access to their corporate systems. 15 years ago, the only IT in the home was a PC, and a number of embedded systems in washing machines and video recorders that consumers couldn’t care less about.

In the enterprise, business users’ expectations of what IT should do for them are higher than ever, thanks at least in part to their positive experience with consumer technologies that feature in the enterprise too. ‘Why can’t I find documents in my company as fast as I can find them on the Internet with Google?’ they may well ask.

IT matters to business people more than ever. Portable email, unified communications, enterprise search, content management and business intelligence, to name just a few, are all key to them making fast, well-informed decisions.

In the developing world the One Laptop Per Child scheme is just one example of the realization that IT, and connectivity to the Internet, can make a huge difference to children’s education. But for adults in these geographies too, IT has the power to deliver their goods and services faster, and further, than ever. To share information and ideas, and to express their very freedom.

IT even still matters in the developed world, where Carr’s argument that infrastructural technologies are commodity and no longer matter is easier to defend.

When Virgin Media, formed though the merger of Virgin Mobile and NTL Telewest lost 46,000 customers in its first quarter of 2007 despite spending £25m on advertising, it partly blamed poorly integrated billing and customer systems for the problems.

Virgin Media duly invested in some more integration technology – “infrastructural”, as Carr would say, but clearly still mattering not only to Virgin Media, but also its competitors to whom those defecting customers had turned.

Getting the technology right may matter more than whether or not it is cheap and available. But either way, I believe IT most definitely still matters. It matters more, to more people, than ever.


Four years ago I wrote a blog about Carr's article and subsequent book here.


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Posted by Jason Stamper on February 7, 2008 04:28 PM

Comments

Thanks for striking a blow for common sense with your article "Why IT still matters". Early on, you ask the pertinent question:

"But is becoming a commodity the same as no longer mattering, of no longer holding any importance?"

My immediate reaction was, "Well, maybe this will supply a clue: food is a commodity. So is water".

True, commodities do not matter (much) to business whizz-kids who are in search of quick easy profits. Tesco is a huge company that mostly sells commodities, and look at its margins!

Posted by: Tom Welsh on February 25, 2008 06:55 PM

It seems a recurring theme in life the factions appear time and again who want to create a debate and argument where none exists,

Sure the world is getting more and more connected, things are moving faster and faster, yes this brings with it a set of challenges and drain on people's time as the deluge of information, garbage and distraction continues to rise.

IT matters but knowledge, insight, the ability to save time, do more with less matters more, IT enables these goals to be achieved to be possible when and where people need them.

The dream of better decisions made on a near real-time data availability where ever you are whether this is where to get a meal, your hair cut or to change the policy on pricing for a specific product line or take decisive action to prevent disaster all really on access, security, availability and above all the ability to see the wood for the trees.

The challenge we all face whether you are from Harvard pondering big questions or trying to make a living is how to filter, categories and prioritise this deluge into meaningful chunks that are relevant to the context you are in at any given moment in time. Now perhaps the academics can apply themselves to that or leave it up to the rest of us to solve that challenge.

Well done as usual Jason

Posted by: David E Alexander on February 26, 2008 03:59 PM

I don't think we have even begun to scratch the surface in realising IT's potential for business. Companies chasing quarterly profit margin improvements still tend to look for cheaper labour, sack people, outsource and raise prices - all things mainly to do with reducing labour costs or 'passing on' costs to customers. These are not innovative tactics and they often lead to poor customer service and long term brand decay. The holy grail for IT still remains its potential to help generate new sources of revenue. Ironically enough, with all the business intelligence tools out there, many executives still rely on instinct to make decisions in this fast moving world. When business people at all levels start really being able to use these tools to make the best use of their resources and unlock business opportunities, then IT will really take centre stage. With the new breed of 'self service' BI tools starting to take off, I think this day could be coming soon.

Posted by: Sarah Lafferty on March 6, 2008 10:35 AM

I couldn’t agree more that IT plays an increasingly important role in any organisation, and that in this period of fiscal tightness CIOs are looking for ways to reduce costs and increase efficiency.

Sarah Lafferty’s comment raised a number of reasons why businesses should investigate and shop around for tools that will achieve this, and in that vein I would suggest that the right combination of end user “self-service” tools, help desk management products and user support solutions can make a big difference in increasing productivity throughout the organisation and reducing operating costs. They can also allow an IT team to function more effectively with a higher percentage of junior staff, which is a vital consideration when skilled IT staff are in short supply and competition is forcing up salaries.

Posted by: Jon Rolls on March 31, 2008 03:43 PM

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