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Questioning the Underlying Assumptions of IT February 23, 2010

Posted by Peter Varhol in Strategy.
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There has been a significant amount of discussion lately on the impact of the Internet, and the research and learning capabilities it brings to us, and its impact on our intellectual prowess.  The discussion kicked off in earnest two summers ago, with IT gadfly Nicholas Carr publishing an article in The Atlantic Monthly entitled “Is Google Making Us Stupid?”  It has been followed by a survey done by the Pew Internet & American Life Project and Elon University’s Imagining the Internet Center on the future of the Internet.

More on the discussion later; some background is in order first.  Carr was the author of the seminal article in the Harvard Business Review (general link; the article is behind a paywall) almost a decade ago entitled “Does IT Matter?” and a subsequent longer tome of that same name.

Carr is a master at stating the obvious and making it sound radical.  I’m not sure if that contributes to or detracts from the larger discussions he provokes.  His thesis in “Does IT Matter” is that our present era of packaged software and systems means that all enterprises have the same fundamental capabilities, embodied in SAP or Oracle or Microsoft or whatever, and therefore IT doesn’t provide anyone with a competitive advantage.

Well, yes.  I don’t think anyone believes that having computers that enable software to process business information is by itself a competitive advantage.  It may have been the case, decades ago, when one company had a computer (usually just one) and another didn’t, but today of course software and systems by themselves are rarely a competitive advantage.  It’s how you use those systems that matters.

His implication of the sameness of our systems today is that the loss of proprietary systems (think Wang VS or Digital VAX) over the years meant the loss of a unique competitive advantage that such systems brought, because they were proprietary and unique.  I am simplifying his words immensely, and in doing so perhaps attributing meaning that isn’t intended, but it is clearly the logical outcome of Carr’s thesis.

While there may have been a time that proprietary systems in and of themselves did provide a competitive advantage if (and that’s a big if) they provided unique business insight or speed, there is nothing inherent about them or any other system that defines such an advantage.  Today, IT gets you into the game; it by no means wins it.

I can only conclude that Carr’s view of enterprise IT was formed sometime in the 1970s or 1980s, and from a truly Boston-area perspective that focused on highly integrated companies producing proprietary systems (disclosure: as I have lived in the Boston area for over 25 years, that’s not meant as a pejorative).

I do, however, give him immense credit for calling out the obvious with a sufficient amount of disbelief, and having a loud enough voice to have all of us questioning our underlying assumptions.  That’s a good thing to do every once in a while.

In the next post I’ll examine the discussion surrounding Google (as a proxy for the Internet in general) and the evolution of our intelligence.

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