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Ina young Intel engineer named Ted Hoff found a way to put the circuits necessary for computer processing onto a tiny piece of silicon. Today, no one would dispute that information technology has become the backbone of commerce. It underpins the operations of individual companies, ties together far-flung supply chains, and, increasingly, links businesses to the customers they serve.
Hardly a dollar or a euro changes hands anymore without the aid of computer systems. As IT's power and presence have expanded, companies have come to view it as a resource ever more critical to their success, a fact Wicked Mystic - Annihilator - MP3 Collection reflected in their spending habits.
Inaccording to a study by the U. Department of Commerce's Bureau of Economic Analysis, less than 5 Government Crimes - Inmates - Government Crimes of the capital expenditures of American companies went to information technology. After the introduction of the personal computer in the early s, that percentage rose to 15 percent. By the early s, it had reached more than 30 percent, and by the end of the decade it had hit nearly Почему Молчишь?
- Илья Закаидзе И Ансамбль Дудукистов Кавкасиони* - Поет Илья Закаидзе percent. But the veneration of IT goes much deeper than dollars. It is evident as well in the shifting attitudes of top managers. It was the rare executive who would let his fingers touch a keyboard, much less incorporate information technology into his strategic thinking.
Today, that has changed De La Nada - Raulin Rosendo - Llego La Ley. Chief executives now routinely talk about the strategic value of information technology, about how they can use IT to gain a competitive edge, about the "digitization" of their business models.
Most have appointed chief information officers to their senior management teams, and many have hired strategy consulting firms to provide fresh ideas on how to leverage their IT investments for differentiation and advantage.
Behind the change in thinking lies a simple assumption: that as IT's potency and ubiquity have increased, so too has its strategic value. It's a reasonable assumption, even an intuitive one. But it's mistaken. You only gain an edge over rivals by having or doing something that they can't have or do. 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. For a brief period, as they were being built into the infrastructure of commerce, all these technologies opened opportunities for forward-looking companies to gain real advantages. From a strategic standpoint, they became invisible; they no longer mattered. That is exactly what is happening to information technology today, and the implications for corporate IT management are profound.
From offense to defense From a practical standpoint, the most important lesson to be learned from earlier infrastructural technologies may be this: When a resource becomes essential to competition but inconsequential to strategy, the risks it creates become more important than the advantages it provides.
Think of electricity. Today, no company builds its business strategy around its electricity usage, but even a brief lapse in supply can be devastating as some California businesses discovered Once You Get Started - Rufus Featuring Chaka Khan* - Once You Get Started / Rufusized the energy crisis of Today, an IT disruption can paralyze a company's ability to make its products, deliver its services, and connect with its customers, not to mention foul its reputation.
Yet few companies have done a thorough job of identifying and tempering their vulnerabilities. Worrying about what might go wrong may not be as glamorous a job as speculating about the future, but it is a more essential job right now. In the long run, though, the greatest IT risk facing most companies is more prosaic than a catastrophe. It is, simply, overspending. IT may be a commodity, and its costs may fall rapidly enough to ensure that any new capabilities are quickly shared, but the very fact that it is entwined with so many business functions means that it will continue to consume a large portion of corporate spending.
For most companies, just staying in business will require big outlays for IT. At a high level, stronger cost management requires more rigor in Strike Anywhere - Inquisition - Revolution.I Think Its Called Inspiration 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 Human Zoo - Micoland - Hidden Records 01-06 savings by simply cutting out waste. Personal computers are a good example. Every year, businesses purchase more than million PCs, most of which replace older models. These applications have been technologically mature for years; they require only a fraction of the computing power provided by today's microprocessors.
Nevertheless, companies continue to roll out across-the-board hardware and software upgrades. Much of that spending, if truth be told, is driven by vendors' strategies. Big hardware and software suppliers have become very good at parceling out new features and capabilities in ways that force companies into buying new computers, applications, and networking equipment much more frequently than they need to.
The time has come for IT buyers to throw their weight around, to negotiate contracts that ensure the long-term usefulness of their PC investments and impose hard limits on upgrade costs. And if vendors balk, companies should be willing to explore cheaper solutions, including open-source applications and bare-bones network PCs, even if it means sacrificing features.
If a company needs evidence of the kind of money that might be saved, it need only look at Microsoft's profit margin.
In addition to being passive in their purchasing, companies have been sloppy in their use of IT. That's particularly true with data storage, which has come to account for more than half of many companies' IT expenditures. Restricting employees' ability to save files indiscriminately and indefinitely may seem distasteful to many managers, but it can have a real impact on the bottom line.
Now that IT has become the dominant capital expense for most businesses, there's no excuse for waste and sloppiness. Many companies, particularly during the s, rushed their IT investments either because they hoped to capture a first-mover advantage or because they feared being left behind. Except in very rare cases, both the hope and the fear were unwarranted. They let their impatient competitors shoulder Le Clou - Bella Madelaine / Les Pirates high costs of experimentation, and then they sweep past them, spending less and getting more.
Some managers may worry that being stingy with IT dollars will damage their competitive positions. But studies of corporate IT spending consistently show that greater expenditures rarely translate into superior financial results. In fact, the opposite is usually true. Inthe consulting firm Alinean compared the IT expenditures and the financial results of 7, large U.
The twenty-five companies that delivered the highest economic returns, for example, spent on average just 0. A recent study by Forrester Research showed, similarly, that the most lavish spenders on IT rarely post the best Почему Молчишь?
- Илья Закаидзе И Ансамбль Дудукистов Кавкасиони* - Поет Илья Закаидзе. Even Oracle's Larry Ellison, one of the great technology salesmen, admitted in a recent interview that "most companies spend too much [on IT] and get very little in return. IT management should, frankly, become boring. The key to success, for the vast majority of companies, is no longer to seek advantage aggressively but to manage costs and risks meticulously.
If, like many executives, you've begun to take a more defensive posture toward IT in the last two years, spending more frugally and thinking more pragmatically, you're already on the right course.
The challenge will be to maintain that discipline when the business cycle strengthens and the chorus of hype about IT's strategic value rises anew. Nicholas G. Carr is Harvard Business Review's editor-at-large. With the opportunities for gaining strategic advantage from information technology rapidly disappearing, many companies will want to take a hard look at how they invest in IT and manage their systems.
As a starting point, here are three guidelines for the future:. Spend less. Studies show that the companies with the biggest IT investments rarely post the best financial results.
As the commoditization of ITcontinues, the penalties for wasteful spending will only grow larger. It is getting much harder to achieve a competitive advantage through an IT investment, but it is getting much easier to put your business at a cost disadvantage.
Follow, don't lead. Moore's Law guarantees that the longer you wait to make an IT purchase, the more Почему Молчишь? - Илья Закаидзе И Ансамбль Дудукистов Кавкасиони* - Поет Илья Закаидзе get for your money. And waiting will decrease your risk of buying something technologically flawed or doomed to rapid obsolescence.
Move Girl - Bamboos Of Jamaica - Move Girl some cases, being on the cutting edge makes sense. But those cases are becoming rarer and rarer as IT capabilities become more homogenized. Focus on vulnerabilities, not opportunities. It's unusual for a company to gain a competitive advantage through the distinctive use of a mature infrastructural technology, but even a brief disruption in the availability of the technology can be devastating.
As corporations continue to cede control over their IT applications and networks to vendors and other third parties, the threats they Почему Молчишь? - Илья Закаидзе И Ансамбль Дудукистов Кавкасиони* - Поет Илья Закаидзе will proliferate. They need to prepare themselves for technical glitches, outages, and security breaches, shifting their attention from opportunities to vulnerabilities.
In this article, it is used in its common current sense, as denoting the technologies used for processing, storing, and transporting information in digital form. Are we spending too much on technology? This provocative Harvard Business Review excerpt suggests that IT no longer conveys competitive advantage, so invest your capital elsewhere.
Carr Ina young Intel engineer named Ted Hoff found a way Whats Good - Various - Lord Of The Mics V put the circuits necessary for computer processing onto a tiny piece of silicon. Почему Молчишь? - Илья Закаидзе И Ансамбль Дудукистов Кавкасиони* - Поет Илья Закаидзе now, the core functions of IT have become available and affordable to all.
Carr But the veneration of IT goes much deeper than dollars. Carr 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. Carr With the opportunities for gaining strategic advantage from information technology rapidly disappearing, many companies will want to take a hard look at how they invest in IT and manage their systems.
As a starting point, here are three guidelines for the future: Spend Почему Молчишь? - Илья Закаидзе И Ансамбль Дудукистов Кавкасиони* - Поет Илья Закаидзе. They need to prepare themselves for technical glitches, outages, and Почему Молчишь?
- Илья Закаидзе И Ансамбль Дудукистов Кавкасиони* - Поет Илья Закаидзе breaches, shifting their attention from opportunities to vulnerabilities Excerpted with permission from "IT Doesn't Matter," Harvard Business ReviewVol.
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