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Speakers Clash in Spirited Debate Over IT Relevance
March 15, 2004 12:00 PM ET
Computerworld -
PALM DESERT, Calif. -- Does information technology matter anymore? In a sharp debate that marked the end of Day 1 of Computerworld's Premier 100 IT Leaders Conference, author Nicholas G. Carr asserted that IT has largely lost its ability to provide companies with a competitive advantage, and Bob Metcalfe, the inventor of Ethernet, rebutted Carr's views. Rapid Implementation: The New Age of ERP Legacy IT Modernization - Practical Reality Get More from Your IT Budget Interactive Guide: Getting Started with Data Governance ROI of Application Delivery in Virtualized Environments Data in Action: Making the Planet Smarter An In-Depth Look at ROI The True ROI behind WAN Optimization The Workday User Experience Video
The users in attendance were so enthralled by the speakers' arguments that they continued to question them for a half-hour after the session was scheduled to end.
Carr, a former editor at Harvard Business Review, began by recounting his article "IT Doesn't Matter," which ran last year in that publication . In the article, he argued that IT applications and infrastructure, though essential to business and integral to business processes, have become so easily replicable that they no longer provide sustainable competitive advantage.
"When everyone is at parity, profit goes to customers, not to the bottom line," Carr said.
Like railroads, telephones and electricity, IT has become part of the general business infrastructure -- absolutely necessary to compete but no longer strategic, he said. Companies still don't realize this, and as a result, they spend much more aggressively on IT than they should, Carr added.
Today, Carr said, risk management in IT is more important than innovation, and the biggest risk is overspending. "Companies should have a bias to spend less year over year for IT," he said. "Follow, don't lead. Even small delays can save you lots of money and risk."
Bob Metcalfe, the inventor of Ethernet
Image Credit: Asa Mathat
Metcalfe argued that IT matters to the tune of $1.8 trillion in IT spending in 2003, according to figures from IDC in Framingham, Mass. And yet, he said, Carr concludes "that you people should stop spending wildly, stop being suckers, stop squandering corporate assets unless you want to end up on some Sarbanes-Oxley perp walk."
Metcalfe said Carr chose to cite only studies that support his thesis. "Studies have shown that studies show what they're intended to show," he said. "Be suspicious of studies."
The unsung heroes in the innovation machine are the IT leaders in the Premier 100 audience, Metcalfe said. "If Carr's advice is followed, how will new technologies find markets and be perfected? Who will provide testbeds?"
Author Nicholas G. Carr
IT Management
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