In 2003, Carr published a controversial article “IT Doesn’t Matter” that put IT in a different light. Carr makes a distinction between proprietary technologies and infrastructural technologies. He argues that proprietary technologies are those that can be “actually or effectively owned by a single company” (Carr, 2013, p. 42). Proprietary technologies can create strategic advantage as long as they remain protected, and can provide companies with a lot of profit. Meanwhile, Infrastructural technologies provide greater value when shared. Technologies move from proprietary to infrastructure as they mature.
Moreover, Carr asserts that IT has lost its strategic value. He argues that IT is no longer strategic because it has stopped to be scarce goods. In addition, he mentions that profit margins on IT related innovations will disappear. This argument is based on capital intensive goods such as railroads and steam engines. I disagree with this statement. IT should not be compared to such goods. The marginal cost of IT products does not increase with greater scale. Thus, any business that can decrease marginal cost by installing IT can make IT investments profits large and gain improved strategic value.
Furthermore, Carr argues that IT is primarily transport technology, and because everyone got access to IT, it’s no longer offers an advantage. I disagree with Carr. IT provides the primary means for increasing the companies’ knowledge capital. IT helps businesses manage “the
As we have learned throughout this course, the value of information technology has been one of the most influential aspects of conducting business. Information technology is used on a daily basis at all organizations, and it has grown exponentially throughout the course of history. Organizations purchase and implement information technology to gain a competitive edge over their competitors. This dates all the way back to the invention of the steam engine, in the mid-1800s, which allowed finished products to be mass transported by the railroad system. The companies and corporations that used the rail system gained a competitive advantage over smaller companies that used other modes for transporting their
Foundation of IT in a place is very crucial for most business. Organizations can use IT resource to create innovative and strategic process that helps business to reach beyond the status quo. Organization without new technologies resources can lose momentum and fall behind in competition. On the other hand, organizations with effective and updated technologies remain competent and superior; get competitive advantage thus acquire and maintain their big market share.
With Technology being a huge role in the business world we are bound to encounter them in restaurant, stores, and factory. People are demanding faster and better service and those are the quality that technology can provide. Because human services are more expensive than a machine, corporations are more likely to put machine rather than human in their business for their survival. Yes, the corporations are making money but you should not look at it in that point of view.
Any business or company that uses Information Technology (IT) for its operation and is leveraging it for gaining competitive advantage also needs to think about other aspects of the technology. Technical advancement and innovations alone are not sufficient to make any business attractive. IT definitely plays a huge role in the highly competitive business world now than before because of the advancement in the area and various ways it can influence the rise or fall of the business.
Technology can produce more products to the employers, and can work faster than average American’s. Many employers that choose technology want to increase their sales and outcome on a product, or company, such as airlines
Proprietary technologies can be owned, actively and effectively, at times by a single company. For instance, a pharmaceutical holding a patent on a particular compound that is the basis for a drug is an example of proprietary technologies. Infrastructural technology on the other hand provides more value when shared rather than used by a single organization. A company having all the rights to building railroads is an example of Infrastructural technology. This company can operate efficiently, but the effect to the economy is greater if the technology is shared and companies build railroads that can connect more buyers and sellers. Holding proprietary technologies, according to
In an article written by Pam Baker named "Six Tips for Stretching IT Budgets in 2009", the writer recommended six tips to get the most value of technology offerings without sacrificing innovations. However, these tips still need some assessment. This paper assesses both positive and negative impacts that those tips have. Of course, the impact is on both operations and strategic investment spending. It will be concise and to the point.
The “IT Doesn’t Matter” article by Nicholas Carr, states an unrealistic view of the importance of IT in today corporate world. Carr tries to explain that due to the vast amount of advances in the technology field, IT has been rendered mundane. He states that IT has become as common place as a telephone or a typewriter before the beginning of the PC age. The article attempts to explains that due to the ability of most people to obtain computer systems that have capabilities that normal users will never need or use makes high end computers unable to provide the advantage that bigger companies once held over smaller ones.
The mini-case starts with “IT is a pain in the neck,” which is a wrong notion that most of the business managers have in an organization. The history of IT-business relationships in most of the organizations shows that there is a huge gap between both sides which is getting better over a period of time. Today, managers know the fact that it is the people, technology and information that realizes the value of a company and everytime IT cannot be blamed for everything. The days have gone when IT was looked at as the sole responsibility for a company’s growth or downfall. IT processes along with the
As most business they knew that proper investment in the Information systems and Information Technology is the best way to go but they dropped the ball when it came to proper investing, they either didn’t realize or ignored the problems
Information Technology (IT) is a foundation for conducting business today. It plays a critical role in increasing productivity of firms and entire nation. It is proven that firms who invested in IT have experienced continued growth in productivity and efficiency. Many companies' survival and even existence without use of IT is unimaginable. IT has become the largest component of capital investment for companies in the United States and many other countries.
In 2003 when Nicholas Carr wrote the article “IT Doesn’t Matter” companies were just beginning to utilize information technology as a competitive advantage. Mr. Carr contends that technology is not a permanent advantage because in time the competition will acquire the same resources and Information Technology (IT) just becomes another commodity. For the majority of companies throughout the world IT resources have become easily accessible and affordable. If Mr. Carr’s opinion is correct then the equality of IT access has just become a cost of doing
Information Technology (IT): The hardware and software technologies a firm needs to achieve its business objectives (Kenneth C Laudon and Jane P Laudon., 2010).
Electricity, the telephone, the steam engine, the telegraph, the railroad and ..IT? In his HBR article, "IT Doesn't Matter," Nicholas Carr has stirred up quite a bit of controversy around IT's role as strategic business differentiator. He examines the evolution of IT and argues that it follows a pattern very similar to that of earlier technologies like railroads and electricity. At the beginning of their evolution, these technologies provided opportunities for competitive advantage. However, as they become more and more available as they become ubiquitous they transform into "commodity inputs," and lose their strategic differentiation capabilities. From a strategic viewpoint, they essentially become "invisible."
This refers to the means and the methods used to produce the product or the service supplied (Worthington and Britton, 2009). Although this involves more than information technology, IT is becoming increasingly important. An organisation needs to know what technologies are being used by its competitors in order to remain in the market and not fall behind. To make its product more accessible to customers, a firm must also know what technologies are being used by them and how these technologies affect the firm's procedures. In a time where customers can read information on or buy products from firms around the globe, business conduct must adapt to technologies. This is discussed in Iammarino and Michie's article (1998), which also states that 'technology, computing, telecommunications, broadcasting and so on have opened up the world economy'.