Student Projects:What About IT Really Matters

What About IT Really Matters?

Member List

Alfred Schumer (UW)

Project Synopsis

In 2003, Nicholas G. Carr, business consultant and former editor of the Harvard Business Review (HBR), published a provocative article titled “Does IT Matter?” in the May issue of HBR. A year later he expounded on this original article in a book of the same name. In his article, Carr offered the observation that IT, which he defined as “all technology, hardware and software, used to store, process or transport information in digital form,” had become so ubiquitous that, rather than a strategic business resource, it has become a commodity.

Carr based his supposition on observed parallels with earlier technology adoption cycles including railroads, telegraphs and electric power grids from the mid to late 1800’s. From this, he concluded that the IT build out was largely complete and had transitioned from propriety to infrastructural technology. Therefore, Carr concluded, IT should be managed principally as a risk rather than an opportunity. Specifically, Carr recommended reducing IT expenditures, following rather than leading new technologies, and paying particular attention to managing existing risk.

Carr apparently touched a nerve in the IT business community no doubt following closely on the heals of the dot-bomb era when IT spending had already suffered extraordinary declines. The storm of controversy came from many quarters of IT industry (less so from business users) and focused on Carr’s definition of IT, whether IT was in fact commoditized, and the strategic implications of Carr’s recommendations. Unfortunately, the counterclaims ranged from thoughtful to nearly religious, contrite to vitriolic, and largely served to confuse those who most need to understand Carr’s suppositions and decide whether a strategic change in their IT policy is warranted. It is for these policy decision makers this paper is written.

This paper will frame the claims and counter-claims made by Carr and others in order to focus the policy debate on only those issues most likely to weigh on a strategic policy. An attempt will be made to explore the fundamental premises made by Carr, including his definition of IT, and offer alternative comparisions Carr might have chosen in arguing for the commodization of IT. In addition, Alfred will offer possible explanations for the largely imperceptible and certainly uneven productivity gains from IT since the 1960s. Further, the strategic implications of Carr’s recommendations will be examined with particular focus on future importance of “digitizing” business processes. Finally, a thought experiment will be offered applying Carr’s suppostions to the military, rather than just the commercial, IT market.

Full Paper: Student_Projects:What About_IT_Really_Matters:Paper

Current Status

The group dissolved November 20, 2004 and the draft project paper for the remaining author will be posted shortly.