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5.0 out of 5 stars Provocative title, narrow claim, strong argument
You may recall the uproar in 2003 around a short Harvard Business Review article entitled "IT Doesn't Matter". Various IT company leaders spoke out against the article, with Carly Fiorina calling it "dead wrong" and Steve Ballmer calling it "hogwash". There were also many lengthy rebuttals. Nicholas Carr, the author of the original 8 page...
Published on July 4 2004 by David Bridgeland

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2.0 out of 5 stars YOU BET IT DOES.
Happened to pick up and browse through this paperweight at the airport and patted myself for not having bought it.
For one thing, in Carr’s world, information technology managers are fools that drain dollars to the tune of 2 trillion every year, slavishly upgrading to whatever new thing vendors want to sell. This is a VERY narrow definition of...
Published on May 28 2004 by Shashank Tripathi


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5.0 out of 5 stars Provocative title, narrow claim, strong argument, July 4 2004
By 
David Bridgeland (Sterling, VA USA) - See all my reviews
(REAL NAME)   
This review is from: Does It Matter?: Information Technology and the Corrosion of Competitive Advantage (Hardcover)
You may recall the uproar in 2003 around a short Harvard Business Review article entitled "IT Doesn't Matter". Various IT company leaders spoke out against the article, with Carly Fiorina calling it "dead wrong" and Steve Ballmer calling it "hogwash". There were also many lengthy rebuttals. Nicholas Carr, the author of the original 8 page article, expanded the argument into a well-written book, explaining his claim more thoroughly and responding to his critics.
The book (like the article) has a provocative title, but in fact Carr's claim is much narrower than the title suggests. Carr is only focused on *corporate IT*, the systems that companies build and deploy for their own use and the use of their customers and suppliers. He is not looking at consumer IT --- the digital wonders that are showing up in our living rooms, cars, and in our pockets. And he is not looking at governmental IT --- the systems that are used to find terrorists, wage combat, or evaluate welfare eligibility.
More significantly, Carr is also focused on one corporate use of IT, to attain a *competitive advantage*. Can Coke achieve some competitive advantage over Pepsi by implementing a new application? Carr is not asking whether IT can add value to a company --- clearly there are thousands of examples of IT saving money, providing value to customers, to suppliers, and adding value in other ways. Instead, Carr asks whether we can expect IT to add this value in a way that competitors cannot quickly realize the same added value. Can Coke do something significant with IT that will not be quickly replicated by Pepsi?
Finally, Carr agrees that in the past IT has been used to gain competitive advantages. By automating reservations, pricing, and seat assignments in the 1960s, American Airlines really did achieve a lasting advantage over its rivals. By creating logistics applications in the 1980s, Walmart really did achieve a lasting advantage over Sears and Kmart. Carr's claim is that *those days are gone*, that the days of using IT for competitive advantage are over.
His claim rests on three broad trends, each of which undercuts the opportunities for competitive advantage. First, the time needed to replicate a particular IT application---the "technology replication cycle" in his words---has shortened considerably over the last few decades. Hardware, tools and platform technologies have made it increasingly easier, faster, and cheaper to replicate a successful application built elsewhere. This declining technology cycle is likely to continue, and make any advantage in the ownership of a particular application to be short-lived.
Another reinforcing trend is the push toward standardization. 40 years ago every company built their own applications. Since then software products have emerged. These products can always be customized to particular situations, but they often are not. It is often cheaper and easier to adapt the business to the best practices in SAP, rather than to customize SAP to the specifics of the business. The economics of standardization --- the cost advantages for companies to be like their competitors --- trump the advantages of maintaining differences. BPOs further this push to standardization, and away from competitive advantage via IT.
A third trend is the spread of IT business insight. It is much better understood today how to achieve value with IT. The secrets of how to do this spreads with individual experience, with analysts, with books and trade rags, and with consultants. If a company has success with a particular technology, everyone in their industry knows about it quickly.
These three trends (Carr claims) are reducing IT to a role much like electricity. Electricity is critical to all businesses today, but (aside from mishaps like the recent problems in California) no one would expect to find a competitive advantage in superior use of electricity.
Does Carr make his case? I think he does, although there are some big exceptions to his argument.
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5.0 out of 5 stars New thinking on business strategy, June 30 2004
By A Customer
This review is from: Does It Matter?: Information Technology and the Corrosion of Competitive Advantage (Hardcover)
Although this is certainly a book about information technology - and a very illuminating one - I would argue that it's primarily about business strategy rather than technology. The author puts IT into the context of rigorous strategic thinking, using the evolution of the business use of computers to shed light on the critical question of how companies achieve distinctiveness from their competitors - and thus strong profitability. He shows how resources that once provided competitive advantage lose their strategic importance as they become better understood, cheaper and more available. This is what's happened to IT as it has with many other resources in the past. One of the best sections of the book comes when the author shows how the commoditization of IT hardware and software is now spreading to the business processes that are increasingly defined by software. Companies that rush to outsource such processes, he argues, may ultimately find they are sacrificing the foundations of their strategic differentiation and advantage. The book is much less polemical than it's been made out to be. In essence, it challenges the reader to think more broadly and intelligently about the role of information technology in business and about the evolution of strategy itself.
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5.0 out of 5 stars It's about time!, May 30 2004
By 
Rachel Tozier (Brea, CA USA) - See all my reviews
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This review is from: Does It Matter?: Information Technology and the Corrosion of Competitive Advantage (Hardcover)
I am one of the legions of IT managers who by association has contributed to the mess Carr so accurately portrays. This book in on the mark. IT is too technology focused. Worse, IT is blind to its own faults and fails to see that the technology we use and the services we provide are commodities as Carr claims.
Make no mistake, Carr does not make claims that technical innovation is unimportant, nor does he claim that technology properly applied is useless. At issue is the way that technology is misused, which goes back to the fact that IT is so focused on technology that business suffers from unfulfilled promises, application of technology to non-problems, and plain arrogance of those who are supposed to be providing services and solutions to support business imperatives.
This book is must reading by the CxO community. It should wake up the business executives to the fallacies foisted upon them by IT to the point where CIOs and senior IT executives will be held accountable for how well they support business initiatives instead of how technically advanced their shops are. To that end the fact that this book is published by Harvard Business School Press, meaning that it stands a chance of being read by outsiders who do have the power to demand changes in IT, is one of the valuable aspects of this work.
Summarizing, this book is about chronic problems that plague most IT shops, and is also about looking at IT in a more objective way. Do not expect solutions because they are in short supply in this book, but do expect an honest look at the way IT has diverged from being a business support function to being a money pit for corporate resources. Also expect to see technology and IT services placed in their proper context, with all of the hype and mystery stripped away.
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5.0 out of 5 stars Well worth reading, May 29 2004
This review is from: Does It Matter?: Information Technology and the Corrosion of Competitive Advantage (Hardcover)
I'm not a technologist and have no particularly strong feelings about information technology one way or the other. In my own experience, computers have good points and bad points. The reason I bought this book in the first place is because I read an interesting review of it in the New York Times. Now having read the book itself, I can say that I think it's really as much about how competition and strategy as about information technology per se. It's a very illuminating and thought-provoking book. It weaves together discussions of history, economics, and technology in an engaging way. The discussion gets complicated at times but it's always clearly written, even when the author's describing fairly esoteric aspects of software production. Unlike just about every other business book I've read, there's little jargon and few wasted words. It moves fast and covers a lot of ground. The book ends with a broader discussion of some of the the social and political consequences of computerization, which is also fascinating. So I can't say whether all Carr's recommendations are valid or not, and I guess that doesn't really matter to me. I enjoyed the book, and I learned a lot from it. I'd recommend it to anyone with an interest in business or business history.
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2.0 out of 5 stars YOU BET IT DOES., May 28 2004
By 
Shashank Tripathi (Gadabout) - See all my reviews
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This review is from: Does It Matter?: Information Technology and the Corrosion of Competitive Advantage (Hardcover)
Happened to pick up and browse through this paperweight at the airport and patted myself for not having bought it.
For one thing, in Carr’s world, information technology managers are fools that drain dollars to the tune of 2 trillion every year, slavishly upgrading to whatever new thing vendors want to sell. This is a VERY narrow definition of organizational "IT". The world of technology is much wider and ever-expanding, making a direct or indirect impact into our daily lives, both personal and commercial. So the scope of this book is a bit hog-tied.
For another, these petty cavils are not new. Paul Strassman (Paul Strassman Inc.) has been saying the same things for a while. Morgan Stanley's star analyst Stephen Roach broke into the same bungled song and dance in the early 90s. Even more recently, "the bubble burst, I told you" has been recently toted as the safely wise justification. One could think of the many financial bubbles that have burst to disastrous consequences, but that's for another day.
Is IT unproductive? If the answer to that is yes (which it is not) then there are two possible explanations. That IT investments are ineffective (the author's take) or that we're not measuring productivity right. Nobel laureate MIT professor Robert Solow, with his work on "productivity paradox", has proven that the latter may be just as true as the ineffectiveness of tech spending.
Come to think of it, consider this:
- Without IT, the author would not have the website that promotes this hackneyed refrain.
- Nor would we have the Amazon.com website which allows hundreds of readers to commit the mistake of spending money on his book.
- Or on its PDF ebook version.
- IT was used in the the typesetting of this very book.
- IT is used by his publisher to manage all their accounts, including the royalties the author will get.
- IT is used to power almost every record in the university and the office that pays the author his monthly salary (Harvard)
- It is IT in the car that he drives to work that parks automatically or that aids his navigation
- ...and so on...
Overall, the book didn't catch my attention for more than 15 minutes. Which is about the time I've spent on writing the above.
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1.0 out of 5 stars Urge all your competitors to read this book!, May 28 2004
By A Customer
This review is from: Does It Matter?: Information Technology and the Corrosion of Competitive Advantage (Hardcover)
Two Harvard professors summarized Carr's ideas ... the most dangerous advice to CEOs has come from people who either had no idea of what they didn't know, or from those who pretended to know what they didn't. What you want is for your competitors to read this book, hoping they will buy into Carr's misconceptions and dangerous recommendations... so rate it 5 stars for them, while your company pursues IT that does matter. If any of your technology-challenged board members are reading this book, be sure to point them to Don Tapscott's May article in CIO magazine so they will quickly understand Carr's Blueprint for Failure, and to Smith and Fingar's book, IT Doesn't Matter--Business Processes Do, for a complete critical analysis of Carr's superficial premises and misguided recommendations. You may also want to google: Does IT Matter, An HBR Debate, whence the opening comments of this review came. Meanwhile, be sure all your competitors know how wonderful and meaningful this book is. ;-)
Dr. Martin Bushton, former CEO, consumer products company
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5.0 out of 5 stars A valuable guide, May 17 2004
By 
This review is from: Does It Matter?: Information Technology and the Corrosion of Competitive Advantage (Hardcover)
When I saw the hysterical reaction of some big wigs in the tech industry to Carr's argument (Steve Ballmer called it "hogwash"), it made it seem like the author was an anti-technology extremist. So I was surprised to find this book to be so calmly written and so knowledgeable about the history of information technology. Carr isn't saying that IT is unimportant or that technological progress won't continue but that most companies won't be able to use IT itself to provide a strategic advantage. He shows that companies like American Airlines and Reuters used to be able to use their systems to block competitors, but that's not possible anymore. In fact, he says, trying to get an advantage by creating a customized system will probably backfire by being too costly and complicated. It's better to just find a standardized solution that does what you want it to do at the lowest cost possible. This seems to me fairly sensible advice, and Carr provides a lot of evidence to support it. The book puts IT into a broader context which I found very helpful.
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1.0 out of 5 stars Yes, technology does matter., May 16 2004
By 
Gaetan Lion - See all my reviews
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This review is from: Does It Matter?: Information Technology and the Corrosion of Competitive Advantage (Hardcover)
Carr makes a thought provoking but flawed case that technology does not matter all that much. According to him, competitive advantages of companies do not depend on technology. He does point out that many segments of information technology are mature, and have become low return commodities. He also points out that companies are better off not buying the overpriced state of the art technology, but instead should wait till prices come down. Thus, Carr makes many relevant and somewhat self-evident points. Nevertheless, his overall case that technology does not matter falls apart.
Contrary to what Carr suggests, the technological race is endless. There is no finish line. We are in a 24/7 society hooked on perpetual improvement. Whatever gismo you come up with, people are going to imitate it and better it very quickly. Thus, no one can rest on their laurels for long. By the same token, you can't afford to run a business that is not up to date technologically. Technology is both the right of entry, and the key to success for almost any business you can think off.
Also, innovation is the U.S. raison d'etre. You figure everything that can be commoditized is going to be either offshored to China or outsourced to India by American companies themselves as pressured by American stockholders. If the U.S. stops to innovate proprietary technology, our labor force will not remain internationally competitive. We have to add value to our products. We have to constantly innovate and create new markets. If we do, as we have done so far, we will remain the most advanced and productive society. If we don't, we will fall behind just as many high cost Western European countries already have.
If you interested in this subject, here is a couple of books I recommend: "Rational Exuberance" by Michael Mandel. He makes a convincing case that technology does matter, and that the U.S. remains the undisputed leader in innovation, and more importantly in implementing innovation. Another good book is Roger Alcaly's "The New Economy." This is an excellent analysis on the history and prospect of technological innovation. Both these authors get that technology is crucial to the present and future of the U.S. Carr does not [get it].
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2.0 out of 5 stars Couple of contradictions, May 16 2004
By 
Sean Brunnock (Lakeland, FL United States) - See all my reviews
This review is from: Does It Matter?: Information Technology and the Corrosion of Competitive Advantage (Hardcover)
I found a couple of contradictions that, to me, undermine the book. Mr. Carr compares the electric revolution of 100 years ago with the more recent IT revolution and argues that since electricity no longer confers a competitive advantage, then IT should be treated the same way. He underscores this by pointing out that "many large companies created the new management post of vice president of electricity...But within a few years...[they] quietly disappeared" (pg 29-30). Later in the book, he states that "the seniormost corporate IT executives...need to lead the way in promulgating a new sense of realism about the strengths and limitations of IT" (pg 133). If VPs of electricity are unnecessary, then why not so for IT executives?
He also seems to contradict himself regarding ERP and Web browsing software. On page 113 he states, "Yet the vast majority of workers who use PCs rely on only a few simple applications - word processing, spreadsheets, e-mail, and Web Browsing". But earlier he writes, "ERP packages promised to solve, and sometimes did solve, one of the most daunting and expensive problems facing modern companies: the proliferation of narrow, discrete software applications" (pg 46). And on page 115, he describes how one business improved productivity by getting rid of Web browsers.
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5.0 out of 5 stars Interesting and Provocative, May 9 2004
This review is from: Does It Matter?: Information Technology and the Corrosion of Competitive Advantage (Hardcover)
Does IT matter? Of course, it does. Simply unplug the servers and mainframes that support the banking, telecom, travel, health-care industries and see if there is an impact.
This book makes sense if viewed from a 100,000 ft, typical academic or macro-economic industrial change perspective. From that perspective this book is both provocative and interesting. Nick Carr has accomplished few writers/researchers in the IT field have done - that is make us think rather than blindly follow the standard party-line (IT investments create long-term strategic value -- just have faith and keep investing).
Carr is presenting a well known fact that it is not IT that delivers value but how it is implemented in organizations. Take the simple case of Dell. Everyone knows the formula but almost no one has been able to replicate it. The competitive advantage of Dell is not in the IT but its ability to interweave it into a system of doing business. This is classic systems thinking put forth by Jay Forrester in the 60s and Peter Senge in the 90s.
Carr is also simply presenting the obvious fact that segments of the IT industry are maturing and increasingly getting commoditized. Maturing technology markets have unique dynamics and characteristics. Manufacturing automation went through this cycle in the late 1980s. Computer hardware went through this in the late 1990s. IT Services is going through this right now.
Commoditization of IT professional services is clear in application development and maintenance. Evidence of this can be seen in packaged and custom IT application development and maintenance where the rapid rise of onshore, nearshore and offshore IT outsourcing is becoming part of the corporate strategy landscape. I would argue that offshore outsourcing strategies being implemented at many corporations support Carr's thesis well.
The book does an good job of presenting the macro issues. However this book falls short in presenting a case for action/implementation. There is high-level advice in chapter 6 but most of it is useless in the real-world day-to-day operations. What should CIOs do differently when they have millions committed in IT infrastructure projects? When do managers go for strategic projects or tactical projects with immediate payback? What should vendors do to adjust in market segments where they are competing on price and not features?
The IT industry is structurally changing as customers evolve in their thinking. Evidence of this can be found in the business transformation challenge facing Sun. We are finding that executives everywhere are getting more and more skeptical about their internal IT projects. This book will certainly bolster their case and maybe drive them to either conduct more internal ROI analysis or completely outsource operations.
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