Subject: RE: Where do we stand on "IT Doesn't matter?"
From: "Dennis F. Galletta" <galletta@katz.pitt.edu
Date: Tue, 11 Nov 2003 08:36:19 -0500
X-Message-Number: 3
Anurag and others,
Recently, for MBA and executive MBA audiences, I've found that having a class
discussion on Carr's article then the Computerworld interviews (July 7, 2003, with
DeMarco, Strassman, Austin, & McAfee), and covering the Ives and Piccoli case on
Lands' End makes for an interesting contrast.
The link to Carr's web site conveniently leaves out some negative comments by Carr's
colleagues in the July 7 article. DeMarco says "it's not a healthy debate" and
Austin says "Carr is obsessed with the plumbing."
If you read the (extremely thorough and thoughtful) teaching note, you can see an
interesting and rich analysis of sustainability of competitive advantage that is
obviously (and precariously) based on information and IT.
It's ironic that what Carr's colleagues refers to as a superficial analysis costs
$6-7 (the Harvard reprint) while the more careful case of Ives & Piccoli is free (to
AIS members -- it's a CAIS article). Not only one of the very best and most
interesting cases I've ever covered, it provides a powerful counterpoint to Carr.
This one case alone is worth the AIS membership fee. Sorry I didn't restrict my
comment to Anurag for his later summary, but I think too many of us don't know about
the Lands' End case!
References
Carr, Nicholas, "IT Doesn't Matter," Harvard Business Review, May, 2003, Reprint IT
R0305B, pp. 5-12
Ives, Blake and Piccoli, Gabriele, "Custom Made Apparel and Individualized Service at
Lands' End," Communications of the Association for Information Systems, Vol. 11,
2003, pp. 79-93.
DG
-------------------------------------------------------------------------Dennis F. Galletta
Associate Prof. of Business Admin.
Katz Graduate School of Business,
University of Pittsburgh
Pittsburgh, PA 15260
phone: 412-648-1699
fax: 412-648-1693
Internet: galletta@katz.pitt.edu
http://www.pitt.edu/~galletta
SMS e-mail (1 line to cell phone; NOT instant): 4125194003@voicestream.net
------------------------------------------------------------------------------Original Message----From: Anurag Jain (FPM) [mailto:ajain@IIMB.ERNET.IN]
Sent: Monday, November 10, 2003 10:26 PM
To: ISWORLD Information Systems World Network
Subject: [isworld] Where do we stand on "IT Doesn't matter?"
Dear ISWorld members:
Just wanted to put forward my thoughts on the subject. Would be interested
to know where we stand on this issue as IS researcher's community.
---------------------------------------------------------------------Subject: RE: Where do we stand on "IT Doesn't matter?"
From: "William K. McHenry" <mchenryw@uakron.edu
Date: Tue, 11 Nov 2003 06:33:59 -0800 (PST)
X-Message-Number: 4
Dear Colleagues,
Along the same lines as Dennis Galletta, I paired the Carr article with another in my
graduate MS/MBA MIS class. I used Weill, Subramani, Broadbent, "Building IT
Infrastructure for Strategic Agility," Sloan Management Review, Fall 2002, Volume 44,
Number 1, pp. 57-65. Carr just provided a theoretical and anecdotal justification for his
arguments. Weill et al. is based on many years of careful research. In this article they talk
about specific areas of infrastructure that were found to be significantly correlated with
strategic advantage both at the centralized level and at the level of individual business
units.
Of course Carr is arguing about the future and Weill et al. is looking back to the recent
past. Carr's message that costs absolutely have to be brought under control is very
important, but his view of web services as a form of a commodity ignores the
"intellectual" nature of IS technology (see Lee – one of many who have written about
this), by which is simply meant that how any particular instantiation of what seems to be
a commodity information system or component depends on the complex interaction of
organization and technology. Carr seems to think that plugging into a business function is
the same as plugging into electricity. A large body of our IS research would indicate that
he is wrong.
Ref: Lee, Allen, "Researching MIS," in Rethinking
Management Information Systems, Currie, Wendy and
Galliers, Bob, eds., Oxford University Press, 1999,
7-27.
William McHenry
Assoc. Prof. of Management,
University of Akron, Akron OH
Subject: Re: Where do we stand on "IT Doesn't matter?"
From: "Manuel Mora" <mmorauaa@securenym.net
Date: Tue, 11 Nov 2003 14:29:12 -0600 (CST)
X-Message-Number: 7
Dear colleagues of ISWorld:
Since topic is quite relevant, I let me to express my opinion directly
to the list about the recent inquiry posted by Anurag Jain:
The topic is highly relevant and similar to "IT Productivity Paradox" posed
in the 90's by R. Solow - nobel awarded economist- and well arguments challenged by
studies from Brynjolfsson (92, 98). In this case, a general perception is could be that
effectively IT -as technological artifact- is became a "commodity" but IT as a socialbased artifact -e.g. how is socially perceived and deployed- it is far from be it. Large
companies can be acquire the same IT -technological artifact- but its social/organizational
utilization is could be contingent to several factors. In few words, organizations can buy
IT artifacts but "organizational success from IT" cannot be acquired as a commodity.
Consequently, if IT acquires a strategic or not attribute will rely on its organizational
deployment.
Sincerely,
Eng. Dr. Manuel Mora
Associate Professor
Dept. of Information Systems
Universidad Autonoma de Aguascalientes
www.uaa.mx
Dear ISWorld members:
Its been a few months since the highly-debated subject titled article
(http://www.nicholasgcarr.com/articles/matter.html) by Nicholas Carr
appeared in HBR. But surprisingly, there has been no mention/debate on
the same in the ISWorld list. Carr, HBR's editor-at-large, had captured the
attention
(http://harvardbusinessonline.hbsp.harvard.edu/b01/en/files/misc/Web_Letters
.pdf) of the IT community worldwide with his article. For the right
reasons, I guess. And, for saying the wrong thing(s), I am sure.
As you can see on Carr's page and all over the web, CIOs, academicians,
and others in IT profession have been reviewing the article critically.
Coming to my own, very personal critique, I am not saying he's wrong just because
I am from IS community. I am saying this because some of his text does not
stand ground. As IS academicians, I think its imperative for us to join
the debate. Not for the sake of debate, but to put the issue on record.
Here's my opinion on the subject (I had written this at the time when the debate
was on full-steam, but was waiting for some action on ISWorld on the
subject.):
By now, the whole world knows that Carr's thesis is that IT has become a
commodity and hence it has stopped being important in a strategic way.
Now, let us see what makes him say that. Major support for his whole
argument is derived from parallels drawn with the earlier technologies in
the history - railroads, electricity. He presents beaten-to-death growth
figures of kilometers of railroad, megawatts of electricity, and hosts on
internet. With all this, Carr seems to be implying (actually he's quite
explicit) that IT is a mature technology today, and hence going the
commodity way. Even Moore's law is mentioned to support the
falling-costs-and-hence-commoditization theory. But he forgets to mention
the Moore's IInd Law
(http://www.imakenews.com/techreview/e_article000003598.cfm), which says
that the cost of manufacturing chips (putting up plants for new
fabrication technologies) is going up by a huge magnitude. And, in any case, if we
are saying that we will stop at the current level of available processing
power, then just wait till the next MIPS-hungry utility comes along. And this is
not the vendor-speak kind of talk here: Jim Gray, Turing Award winning
scientist says in "Ringing the death knell on tech's high-growth era"
(http://www.iht.com/cgi-bin/generic.cgi?template=articleprint.tmplh&ArticleI
d=95228), "I've seen the 'end' at least twice in my career - only to be
surprised by the next wave. My guess is that this computer thing has just
gotten started". Look around. People are already talking about
non-silica processors, and even clockless silica chips. Hence, even though its a
fact that IT is widely available today, there would be innovations in hardware
and software, rocketing the pricing upwards that would make it more
available to some firms than others. But does that matter for strategic
advantage? According to HBR article, it (scarcity) does. And more
importantly, 'only' this matters for competitive advantage. But as you
will see in argument in following paragraph, its just not so. Its true in
short-term only and that's where Carr's got it wrong: He has taken a
myopic economics-only view of IT (investment, cost, return) and hence, the
inevitable conclusions.
Coming to the issue of IT becoming 'boring', even though IT might have
become an 'infrastructural technology', the reason of strategic advantage
to firms is not the availability of technology (or non-availability to
competitors: 'scarcity' as the article says), but how firms put IT to use,
a critical aspect of the whole startegic IT argument, and something that
Carr mentions only in the passing! There will be another American Airlines,
another American Hospital Supply reaping strategic benefits as long as
they 'get IT right' and not by making sure that their competitiors don't have
the same technology.
In his Oct 1987 piece - "Infotech and Corporate Strategy", Prof Rosabeth
Moss Kanter (HBS) classified the effects of IT into two categories: 1)
Transaction efficiency (TE), and 2) Communication Control (CC). Futher,
he said that "In the long run, the CC area will be the one in which the
greatest strategic possibilities wil be found." Now, not by any reckoning
has that 'long run' ended yet. In fact, it just got started. After putting
enterprise-wide systems in place, firms are discovering that inter-organizational
collaboration is becoming more and more important and increasingly the source of
competitive advantage for all players in the supply chain.
The point is that predicting demise of IT - a technology with high
innovation and growth potential even today - as a differentiator by
showing the growth charts similar to historical technologies is highly misleading.
Taking the dotcom/investment bust of late 90s as the sign of maturing of
technology is even more so. There are occasional blips in every
technology's journey and what we are witnessing for last few years could sure be just
that for IT, nothing more. Predicting too much on that basis alone combined
with historical parallels, without taking into account the vibrancy,
current developments, and innovations going on in the industry/technology, is
quite a dangerous proposition and should be criticized.
Just wanted to put forward my thoughts on the subject. Would be
interested to know where we stand on this issue as IS researcher's community.
Anurag Jain
Doctoral Student, Information Systems
G-214, Hostel Blocks
Indian Institute of Management Bangalore
Bannerghatta Road
Bangalore 560076
INDIA
Ph: +91-80-6993257, Mobile: +91-9886178995
Alternate mail: webmaster@anuragjain.com
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---------------------------------------------------------------------Subject: Re: Where do we stand on "IT Doesn't matter?"
From: "Deborah Lafky" <Deborah.Lafky@cgu.edu
Date: Tue, 11 Nov 2003 12:39:26 -0800
X-Message-Number: 8
I agree with Manuel. Carr is confusing an artifact with the use of the
artifact. The competitive advantage conferred by IT lies not in the
plumbing but in how that plumbing is exploited by the organization. To
use Carr's metaphor, it's not the telephone itself that is important---it's
how that telephone is used. The main competitive advantage that any
organization has is smart people doing creative things. Expanding the
toolkit doesn't change that. Nor does it change the importance of IS
research as a contributor to human innovation.
Deborah Lafky
School of Information Science
Claremont Graduate University
Subject: Re: Where do we stand on "IT Doesn't matter?" (Why IT Doesn't Matter- and
How IT Still Matters)
From: Yogesh Malhotra <yogesh@syr.edu>
Date: Wed, 12 Nov 2003 03:05:37 -0500
X-Message-Number: 1
Why IT Doesn't Matter and How IT Still Matters
The interesting thread of arguments prompted my motivation to share my
interaction with HBR that resulted in the attached article. This article
explains 'Why IT Doesn't Matter' and 'How It Still Matters.' This
apparent 'dialectic' expands on the prior points made in the discussion
in this thread.
Malhotra, Y., Integrating Knowledge Management Technologies in
Organizational Business Processes: Getting Real Time Enterprises to
Deliver Real Business Performance, Journal of Knowledge Management,
Special Issue on Knowledge Management and Technology, Q4, 2004.
(forthcoming). Web:
http://www.kmnetwork.com/KnowledgeManagementRealTimeEnterpriseBusinessModel
s.pdf
[Motivated originally by an invitation to submit from an HBR Senior
Editor, the original short version of this article was submitted to the
HBR editorial board for review and later withdrawn by the author - five
months before the publication date of Nick Carr's controversial HBR
article 'IT Doesn't Matter.']
Yogesh Malhotra,PhD,MBA,BE,CCP,CEng
Martin J. Whitman School of Management, Suite 419
Syracuse University, Syracuse, NY 13244-2130
e-mail: yogesh@syr.edu, phone: (315) 443-3571 fax: (315) 443-5457
http://www.som.syr.edu/facstaff/yogesh/
Subject: IT Doesn't Matter (or Does It?)
From: "Bhattacherjee, Anol" <ABhatt@coba.usf.edu>
Date: Wed, 12 Nov 2003 15:20:51 -0500
X-Message-Number: 9
Carr's (2003) HBR article "IT Doesn't Matter" claims that information
technologies (IT) has become a commodity, much like electricity and
transportation, by virtue of its ubiquity, and thereby has lost much of its
purported strategic value. Accordingly, the author suggests that businesses
should take a three-pronged approach toward avoiding IT over-investment: (1)
spend less, explore cheaper alternatives, and eliminate waste; (2) delay IT
investments to lower IT adoption risks, (3) use IT to minimize disruptions,
not deploy in radically different ways.
Carr's argument is not inconsistent with the observations that: (1) more and
more businesses are employing outsourcing as a way of reducing their IT
expenses, and (2) IT-based strategic differentiation (as envisaged by many
e-commerce businesses) has been ephemeral at best. This argument is also
consistent with the contemporary academic view that IT is today more of a
competitive necessity than one of competitive advantage, and with the
resource-based argument that IT-based strategic advantages are only
short-lived, until imitated or substituted by a competitor. It is important
to note that Carr is not claiming that IT has no business value. He also
does not claim that businesses should shun all their IT investments, just
like they should not stop using electricity or transportation. Indeed, he
says, "an IT disruption can prove equally paralyzing to your company's
ability to make products, deliver services, and satisfy customers", and 'a
brief lapse in supply can be devastating." Instead, he suggests that the
quest for IT-based strategic advantage is fundamentally misguided.
Though the title of Carr's article seems to portray that IT investments in
firms have no value at all, the essence of his argument is that IT
investments have no "strategic" value. The title, presumably worded to grab
attention and provoke debate (and successful at that :-), therefore is a
little misleading. Over time, many readers will only tend to remember the
title instead of the embedded argument. Hence, the article can be dangerous
if business managers take Carr's title literally and shut down the IT
products and services required for their very survival.
For academics, however, Carr's article provides an opportunity for us to
introspect and reexamine several of our current assumptions and lines of IS
research. For instance, the strategic IS planning literature may interpret
Carr's article to focus less on the design or implementation of strategic IT
systems and more on strategic utilization of data (e.g., business
intelligence) generated from IT systems. Doing so can shift the focus of IT
research from IT systems to data stored in those systems. Constructs such
as system quality and technology usefulness may have to be modified to data
quality and data usefulness respectively. Likewise, Carr's article also has
interesting implications for revisiting IS pedagogy. For instance,
IT-enabled value-creation may focus less on its elusive revenue-generating
potential and more on its cost-reduction potential (e.g., via automation,
streamlining operations, etc.). I would welcome an open, informed debate on
the potential impacts of the emerging utility view of computing on today's
IS research and pedagogy.
Anol Bhattacherjee, Ph.D
Associate Professor, ISDS Department
College of Business Administration
University of South Florida
4202 E. Fowler Ave, CIS 1040
Tampa, FL 33620-7800
Email: ABhatt@coba.usf.edu
Phone: 813-974-6760
Web page: http://www.coba.usf.edu/abhatt/