http://www.nytimes.com/2004/05/06/business/06scene.html
New book is out by Nicholas Carr titled "Does IT Matter?". It follows on an article in HBR that asked the same question, and was widely panned by the IT industry.
I haven't read the book, although I do plan on it, but I did read the HBR article and largely agree with Carr's conclusions. The execs, notably Ballmer and Fiorina, who were critical of it are doing what they should be doing... can you imagine the headlines and subsequent stock market reaction if Ballmer was quoted "well yeah, IT really doesn't matter as much as we have everyone believe".
Carr's point, which is largely lost in the firestorm of reactions that followed the article, is that IT is cheap and available to everyone, therefore it's not the actual technology that gives you a competitive advantage but changing the way you do business. In short, good leadership and tactical execution, whether it's with IT or not, is what gives businesses a competitive advantage.
When technology was super expensive and only a few businesses could afford it, well the ones that had it enjoyed some advantage over their competitors. Fast forward today and you have a small business with 2 employees and a $60 a month subscription to Salesforce.com, and they have the same functional capacity that a larger competitor with Siebel or SAP does, and needless to say it cost them a lot more. So did IT give the large player an advantage or did it level the playing field for the small player. Well neither, because if either end of the spectrum simply bought software and didn't address the way they conduct their business.
I really don't expect anyone from the tech industry to suggest that IT is not a factor in the productivity gains that we have seen over the last two decades, in fact I am among the group that thinks that IT is the biggest productivity lever that business has today. But productivity alone is not a measure of competitive strength, it simply a measure of doing more with less.
Maybe I'm running the risk of rambling on a little with this, but the thing that stimulates my imagination when I think of this stuff is the idea that a new form of technology company could emerge in the coming years. We have grown up in an industry where the perception is that a company has to hire loads of developers, management and sales people, span multiple geographies and vertical markets, and put forward a grandiose vision of things to come in order to achieve a pinnacle position in the industry. I'm thinking, and betting on, a different scenario in the future where companies come together by building value around low cost business models featuring highly talented experts on specific technologies and markets, rather than attempting to create some disruption through a dramatically different product or technology. In my scenario IT doesn't matter if the playbook is the disruptive technology play, but it does matter if the playbook is the disruptive business process play manifested in some small series of loosely connected technology and application advances brought together by experts who understand how those businesses work.
Of course, if you think that the problem with the enterprise software market is the distribution channel, then you are not likely to agree with me. I do think that the distribution channel is flawed, at least the whole direct sell side of things, but there is no reason why the software business itself can't evolve to move away from direct sell, especially with the ASP delivery models we are seeing with increasing frequency.
By the way, I'm writing my post today on an offline Typepad editor called Movable Post. It's pretty cool, kind of like Radio for Typepad. I found out about this tool by reading Brad Feld's blog.
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