IT Doesn't Matter by Nicholas Carr: Reflection

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1- Reflection on the article of Carr

In May 2003, Harvard Business Review (HBR), a magazine mainly addressed to business people in general such as managers, analysts and strategists etc., and IT constituencies in particular such as vendors, researchers, engineers etc., published a revolutionary article written by Nicholas Carr entitled “IT doesn't Matter”. This article has created a huge debate within the IT industry, from opponents and proponents the opinions differ considerably. So in order to understand the debate better, we will start in a first part to reflect on the arguments Carr presented to support his thesis, then we will have a closer look on what other scholars think about the article before concluding in the last part by giving our personal opinion.

Carr is known as an independent writer and editor who has a good knowledge about the IT field and has written and guided many works about it; due to these status and reputation, Carr's main idea which is quite simple took rapidly a huge magnitude worldwide (Hackathorn, 2003). He stated that IT is very essential to businesses but does not provide them with competitive advantages anymore. Knowledge in general and information in particular are commonly considered as power (Davies, 1994). Knowing what others don't know especially when they may need to know it, gives you certainly more power over them and a competitive advantage you may benefit from a lot. However, with the increase of information technologies, especially the Internet, the access to information is becoming easier and its availability increases continuously with time which make the information worth less and of no strategic value. The financial market is the best example to better understand this idea. In fact within these kind of markets, information and its interpretation are the two main drivers of success and thus generators of higher profits. When information concerning a specific company or any financial asset is of limited access to only few investors, they will have a clearer vision so to take better decisions that will enable them to expect huge returns. This idea of ubiquity is what pushed Carr to the conclusion that IT doesn't matter anymore.

Their very power and presence have begun to transform them from potentially strategic resources into commodity factors of production. They are becoming costs of doing business that must be paid by all but provide distinction to none.

(Carr, 2003)

In fact, IT is an essential element within the good functioning of the business but does not provide it with a competitive advantage anymore since it has lost all what used to make it unique, its scarcity. According to him, companies should then consider this clear ubiquity as a wake-up call to change their management of IT by spending less. It is undeniable that investment in IT has considerably increased from less than 5% in 1965 of the capital expenditure to approximately 50% in the early 2000's and this is because of the benefit it offers to the companies adopting it and using it effectively (Carr, 2003). This importance means that IT is nowadays a necessity to be at equal level with competitors and a condition to stay in the market but also means that supply of IT increased with time which has surely resulted in a reduction of its price.

He considered IT as the latest world-changing technology following a series of technologies such as railroads, telegraphs, telephone etc., that have been commoditized with time. For him, alike these technologies, IT's pattern is already known and determined. The clear distinction of the different stages of technology's building into the industry is very crucial in its management. In the first stage, technology is rare and very difficult to obtain. Wisest companies, which notice its usefulness within their company and identify the competitive advantage it will provide from far, are the first to invest in it. They are aware that this investment,...
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