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IT doesn’t matter IT does matter

IT doesn’t matter IT does matter. Carr, Nicholas G HBR / 2003.05. 목차. 1. IT doesn’t matter?. 2. Vanishing Advantage. 3. The Commoditization of IT. 4. From offense to Defense. 5. Does IT matter?. 1. IT doesn’t matter?.

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IT doesn’t matter IT does matter

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  1. IT doesn’t matter IT does matter Carr, Nicholas G HBR / 2003.05

  2. 목차 1 IT doesn’t matter? 2 Vanishing Advantage 3 The Commoditization of IT 4 From offense to Defense 5 Does IT matter?

  3. 1. IT doesn’t matter? IT’s power and presence have expanded, companies have to view it as a resource ever more critical to their success. IT goes much deeper than dollars, It is evident as well in the shifting attitudes of top managers. Chief executives now routinely talk about the strategic value of information technology, about how they can use IT to gain a competitive edge. “Digitization” of their business models.

  4. 1. IT doesn’t matter IT’s potency and ubiquity have increased, so too has its strategic value. The core functions of IT - Data storage, data processing, and data transport – have become available and affordable to all.

  5. 2. Vanishing Advantage Proprietary technologies – can be owned, actually or effectively by a single company Infrastructural technologies – offer far more value when shared than when used in isolation. Infrastructural technologies can take the form of a proprietarytechnology A company can use it to gain advantages over rivals

  6. 2. Vanishing Advantage Infrastructural technologies often lead to broader market changes The buildout force users to adopt universal technical standardized, as best practices come to be widely understood and emulated. Commoditized. The only meaningful advantage most companies can hope to gain from an infrastructural technology after its buildout is a cost advantage and even that tends to be very hard sustain Infrastructural technologies don’t continue to influence competition Influence is felt at the macroeconomic level, not at the level of the individual company.

  7. 3. The Commoditization of IT IT has all the hallmarks of an infrastructural technology Any transport mechanism, it is far more valuable when shared than when used in isolation. IT is also highly replicable. The arrival of the internet has accelerated the commoditization if IT by providing a perfect delivery channel for generic applications. IT is subject to rapid price deflation.

  8. 3. The Commoditization of IT IT’s evolution has closely mirrored that of earlier infrastructural technologies. IT provided forward-looking companies many opportunities for competitive advantage early in its buildout.

  9. 3. The Commoditization of IT Many signs that the IT buildout is much closer to its end than its beginning IT’s power is outstripping most of the business needs it fulfills. The price of essential IT functionality has dropped to the point where it is more or less affordable to all The capacity of the universal distribution network has caught up with demand optic capacity than we need. IT vendors are rushing to position themselves as commodity suppliers or even as utilities. The investment bubble has burst

  10. 4. From offense to Defense When resource become essential to competition but inconsequential to strategy, the risk it creates become more important than the advantages it provides. Today, 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. At a high level, stronger cost management requires more rigor in evaluating expected return from systems investments, more creativity in exploring simpler and cheaper alternatives, and a greater openness to outsourcing and other partnerships Delaying IT investments can be another powerful way to cut costs-while also reducing a firm’s chance of being saddled with buggy or soon-to-be-obsolete technology.

  11. 5. Does IT matter? IT by itself rarely. IT is inherently strategic because of its indirect effects – it creates possibilities and options that did not exist before. IT may become ubiquitous, but the insight required to harness its potential will not be so evenly distributed. These dimensions if transaction costs often represent significant bottlenecks to performance improvements and competitive advantage.

  12. 5. Does IT matter? Business practices required to exploit IT’s potential for addressing such business challenges. IT’s possibilities when they focus so heavily on business practices within the enterprise. IT can bring about new business practices. The differentiation is not in IT itself but in the new practices it enables.

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