I agree with Nicholas Carr that the competitive edge gained by companies through IT in the past was not due to the fact that they had IT and others did not. It was due to how they used it, to the innovative business processes and models they created around new information technologies. Now, Carr tells us, best practices are being built into the infrastructure itself. He writes off any further strategic differentiation by arguing that IT is like other “infrastructure technologies” that lost their competitive potential once they became “accessible and affordable to all.”
Carr’s historical analogies to other infrastructure technologies are not convincing. Information technology has infinite and constantly expanding functionality, while Carr’s other technologies – steam engines, railroads, electricity, telephones – have narrow functionality.
Electricity, for example, is simply a source of energy; it hasn’t changed much since we found a way to harness it. And it can, and probably will, be replaced by another source of energy. Unlike electricity, IT is very different from what it was 30 or even ten years ago. The technologies used for processing, storing, and transporting information continue to expand. Also growing is the demand for IT, with more businesses and types of organizations, more processes and activities, and more and more consumers at home and on the go in need of its productivity enhancing functions. Should we believe Carr, who says that the build out is over, or should we listen to Alan Greenspan, who argues that “there are still significant opportunities for firms to upgrade the quality of their technology and with it the level of productivity”? Or perhaps we should listen to genomics expert Craig Venter, who says that at least a decade or two will go by before computing can catch up with the current needs of biological