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IT doesn't matter.

Nicholas G Carr1

  • 1ncarr@hbsp.harvard.edu

Harvard Business Review
|May 16, 2003
PubMed
Summary
This summary is machine-generated.

Information technology (IT) is no longer a source of competitive advantage as it becomes widely available and less costly. Companies should shift IT management focus to risk reduction and cost control, not strategic opportunities.

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Area of Science:

  • Business Strategy
  • Information Technology Management

Background:

  • Companies increasingly invest in information technology (IT), viewing it as critical for success and competitive advantage.
  • Historically, widely adopted technologies like railroads and generators offered strategic benefits briefly before becoming commoditized.

Purpose of the Study:

  • To re-evaluate the strategic value of information technology in modern business.
  • To propose a new approach to IT management focusing on risk mitigation and cost efficiency.

Main Methods:

  • Analysis of historical technological adoption trends.
  • Examination of the current role of IT in corporate strategy and spending.

Main Results:

  • Information technology is becoming a commoditized resource due to its ubiquity and decreasing costs.

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  • Unlike scarce resources, widely available IT does not provide a sustained competitive edge.

    • Conclusions:

    • IT management should transition from pursuing strategic opportunities to focusing on operational efficiency and risk reduction.
    • Prioritizing IT cost management and security is crucial to avoid competitive disadvantages.