IT Doesn’t Matter

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 Discussion 2.1

› What exactly does Carr mean by “IT doesn’t matter”?

› Do you agree with him? Why or why not?

› Time limit: 10 minutes

› Answer the questions in your own words. No mark will be given for “copy
and paste” from the article.

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 More Discussion

› What gives a resource the capacity to be the basis for a sustained

competitive advantage?
› What is the difference between proprietary technologies and infrastructural
technologies?
› In what way does IT become essential? In what way does IT become
inconsequential?
› What should companies do to avoid overspending in IT?

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 IT Doesn’t Matter

› Scarcity (not ubiquity) makes a business resource

truly strategic
› Distinction between
- Technologies that can be owned (actually or effectively)
by a company
- Technologies that offer far more value when shared than
when used in isolation
› IT has become a commodity
- Affordable and accessible to anyone like many broadly
adopted technologies such as railways, and electrical power
- No longer offers strategic value (competitive advantage) to anyone
› Focus on the risks rather than the potential strategic advantages.
- No company builds its strategy on its electrical usage – but even a brief lapse in supply can be
devastating
› The greatest IT risk is overspending – putting your company at a cost disadvantage
- Manage IT’s costs and risks with a frugal hand and pragmatic eye

Source: Carr, N. (2003). IT doesn’t matter. Harvard Business Review, 81(5), 41-49.
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 IT Doesn’t Matter

› Spend less
- Rigorously evaluate expected returns from IT investments
- Separate essential investments from discretionary, unnecessary, or counter-
productive ones
- Explore simpler and cheaper alternatives, and eliminate waste
› Follow, don’t lead
- Delay IT investments to significantly
- Buy only after standards and best practices solidify
- Let the more impatient rivals shoulder the high costs of experimentation.
› Focus on risk, not opportunities
- Many corporations are ceding control over their IT applications and networks to
vendors and other third parties.
- More and more threats in the form on technical glitches.
- Focus IT resources on preparing for such disruptions – not deploying IT in a radical
new ways

Source: Carr, N. (2003). IT doesn’t matter. Harvard Business Review, 81(5), 41-49.
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Source: Stewart, T. A., Brown, J. S., Hagell III, J., McFarland, F. W., Nolan, R. L., & Strassman, P. A. (2003). Does IT matter? An HBR debate. Harvard Business Review, 81(6), 1-17.
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