In some really weird way, I suddenly remembered an article IT doesnt matter by Dr Carr in Harvard Business Review where he made

a provocative statement below: . As IT availability increases and their cost decreases as they become ubiquitous they become commodity inputs. From a strategic standpoint, they become invisible; they no longer matter Dr Carr I think Dr Carr is wrong in his prediction. The changes that I have witnessed from ICA require conscientious strategic foresight and intent from ICA management to leverage upon IT to create this wonderful and impressive experiences that we are able to enjoy today. It is made possible by aligning everyone towards the single-minded goal to serve the customers. Consequently, every business processes, that are required to make a passport, are streamlined with the creative combination of IT, people and business processes. If IT is out of the picture, none of this sort of impressive experience can happen. So to Dr Carr (and I do believe that you probably heard this million of times from many other people), IT does matter. In an ever increasingly hyper-competitive business environment, IT will only going to matter more and more in the future.

Summary of the article

Carr writes that companies should spend less on IT. His reference was based on a study that suggests that companies with significant IT-investments rarely get a financial result that matches their IT-investment. Sustained competitive advantage today, is more difficulty to achieve because IT is getting more and more commoditized. When spending less money on IT the business will at least not get in a more difficult financial situation. Secondly Carr points out that one should not be the first one to try new technology. Carr writes that the IT capabilities become more homogenized and therefore the advantage of being first in the field is getting smaller. If one wait until a technology has become widely spread and even a standard type of technology you know what you get when buying it. This, of course, a much safer way of spending money on IT-investments which reduces the risk of economic failure.

Thirdly, Carr points out that one should direct ones attention towards the present vulnerabilities instead of the opportunities that comes from IT investments. One needs to be prepared for technical glitches and security breaches. A disruption in the availability of the technology can be devastating for a company. Vanishing advantage of IT. Affordability of IT has increased because of rapid fall in prices. The use of IT has become a daily phenomenon . Carr writes that the advantage of knowing how to use IT and having access to IT has disappeared. This is why we can't describe IT as a proprietary technology but an infrastructural technology.

He strikes the difference between infrastructural technology and proprietary technology. He explained that unlike proprietary technology, infrastructural technology offers far more value when shared than when used in isolation, which is the strong side of. He compares the way IT has developed with the way railroads and electricity developed. For Carr IT is a transport mechanism. The issue of IT becoming more homogenized because larger companies buy generic software with embedded best practices. Dr. Carr asserts that this leads to homogenization and commoditization of IT and deflation of software and hardware prices, and reduces the market need for customized software.

Argument

a) IT as a commodity
Carr argues that having a competitive advantage lies in having something others do not have. Though IT is undeniably essential, it has also stopped being scarce and hence does not offer any strategic advantage any more. In other words commoditization, (due to lower prices, standardization and its highly replicable nature), implies lessened strategic advantage. Many disagree with him. Widespread availability creates new business opportunities, not stagnation. Paul A. Strassman A Retrospective Forecast of the Future (http://www.strassmann.com/pubs/hbr/carr-letter.shtml) "The fundamental point is this. The move to a common infrastructure does not reduce the opportunities for competitive advantage; it increases them.[15]" Vijay Gurbaxani, Professor, University of California http://web.gsm.uci.edu/~gurbaxan/ / (http://www.fairdene.com/hbr/critics.html) We deduce from the article that IT is approaching the end of the build out phase. According to him we will soon be at the point where there is no need for more physical capacity since most needs are already fulfilled.

Dan Farber, vice president in CNET and editor in Chief in ZDNet responds to Carrs claim of IT as a commodity in these terms: .. The problem is that most software vendors have not figured out yet how to build reliable, easy-to-configure-and-use software, and IT organizations are often dysfunctional. .. Carr's notion of the commoditization and homogenization of infrastructure gives too much credit to IT as a mature industry with an established base of technology and best practices that will evolve linearly. Dan Farber The End of IT as we know it? May 28, 2003
http://techupdate.zdnet.com/techupdate/stories/main/0,14179,2913824,00.html

He further argued that New categories or niches of software and hardware will continue to spring up that bring proprietary advantages to the vendors and customers, but they will mostly be short-lived. Differentiation among companies delivering IT products and services will have more to do with support, security, availability, integration, and the trust factor. Technology as a competitive weapon is more about execution and competency than a secret sauce.

Comparing IT to other technologies

From Carrs perspective the most profitable strategy is to evaluate ones actual needs thoroughly before making large investments based upon assumed external demands or a belief in gaining an advantage over competitors. But in a reality where IT has become infrastructural and ubiquitous it seems hazardous to ignore. The infrastructural way of viewing the world puts new strategies forth. Gaining a competitive advantage lies in connectedness and size. Being partly disconnected from the desired infrastructure may render you disconnected marketwise. Star and Griesmer[22] talk of boundary objects, which is a gateway concept. When connection is the key then controlling the connection seems as a clever strategic move; that is being the gatekeeper. However, As networks become larger and more linked to and embedded into other networks, they become harder to control. [19] Getting ahead, running a business wisely, creating a successful strategy; all become an issue of battling complexity. In perfect competition there are a large number of small firms in the industry, each producing identical products.[23]

Carr naively believe that outsourcing is the magic solution to IT problems and that "follow, don't lead" is a viable strategy for enterprise IT. My experience completely contradicts both of those claim. In his initial HBR article he claims:
At a high level, stronger cost management requires more rigor in evaluating expected returns from systems investments, more creativity in exploring simpler and cheaper alternatives, and a greater openness to outsourcing and other partnerships. But most companies can also reap significant savings by simply cutting out waste.

In some really weird way, I suddenly remembered an article IT doesnt matter by Dr Carr in Harvard Business Review where he made a provocative statement below: . As IT availability increases and their cost decreases as they become ubiquitous they become commodity inputs. From a strategic standpoint, they become invisible; they no longer matter Dr Carr I think Dr Carr is wrong in his prediction. The changes that I have witnessed from ICA require conscientious strategic foresight and intent from ICA management to leverage upon IT to create this wonderful and impressive experiences that we are able to enjoy today. It is made possible by aligning everyone towards the single-minded goal to serve the customers. Consequently, every business processes, that are required to make a passport, are streamlined with the creative combination of IT, people and business processes. If IT is out of the picture, none of this sort of impressive experience can happen. So to Dr Carr (and I do believe that you probably heard this million of times from many other people), IT does matter. In an ever increasingly hyper-competitive business environment, IT will only going to matter more and more in the future.