Win a copy of 97 Things Every Java Programmer Should Know this week in the Java in General forum!
  • Post Reply Bookmark Topic Watch Topic
  • New Topic
programming forums Java Mobile Certification Databases Caching Books Engineering Micro Controllers OS Languages Paradigms IDEs Build Tools Frameworks Application Servers Open Source This Site Careers Other all forums
this forum made possible by our volunteer staff, including ...
Marshals:
  • Campbell Ritchie
  • Paul Clapham
  • Jeanne Boyarsky
  • Junilu Lacar
  • Henry Wong
Sheriffs:
  • Ron McLeod
  • Devaka Cooray
  • Tim Cooke
Saloon Keepers:
  • Tim Moores
  • Stephan van Hulst
  • Frits Walraven
  • Tim Holloway
  • Carey Brown
Bartenders:
  • Piet Souris
  • salvin francis
  • fred rosenberger

Does IT Matter?

 
Ranch Hand
Posts: 1551
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
Yesterday's NYT says this article,Does IT Matter, from the Harvard Business Review is a buzz in the boardroom. See the NYT article here.
Without buying a copy from HBR you can get a feel for the authors assertions in rebuttals published by HBR on the web here.
IMO it's amazing what management types don't understand about technology.
 
Saloon Keeper
Posts: 22122
151
Android Eclipse IDE Tomcat Server Redhat Java Linux
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
Somewhere I read just the other day that this is the Question of the Day - that every publication's doing their own slant on it.
Obviously, as a biased observer, I'd say IT does matter, just as the executive types who - in one case I heard - refer to their IT staff as "Shoe Salesmen", would like to say that it's just another commodity cost.
FWIW, I've heard it stated that one of the reasons that Wal-Mart owns the world and KMart went Chapter 11 is that Wal-Mart was very agressive in IT - even going so far as to lure staff from Amazon.com and getting embroiled in some legal issues therefrom. KMart, on the other hand said "Well, the economy's going for a downturn. Let's cut costs. First we'll dump all those expensive useless IT people and their projects."
Then again, Wal-Mart didn't hire Martha Stewart.
 
Author
Posts: 6049
2
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
I didn't read thew NYT's article, but I did read the HBR article (it was in the May edition). I agree with it 100%. Here's a summary.
In the last 20-30 years, IT has been a competitive advantage. It provided efficency and lower cost. That's about to change. The author notes parallels with the electric grid and railroads. Early adaptors had an advantage, such as faster transportation of good on proprietary rail systems. In time, the technology becomes common place; it's no longer a competitive advantage, but a requirement. (Can you imagine any company not using electricity?) As with these earlier technologies, early adaptors created proprietary systems. Those then became a liability as standards came out (e.g. AC vs DC power systems in the US). So too, is this happening to software. Additionally, traditionally, our programs were limited by processor speed and memory. For the first time, the hardware is outpacing the software (we are overcapacity on our desktops in many applications). IT is no longer a strategic advantage; it is simply a requirement of doing business. IT manmagers should make purchases in that mindset. (Obviously, this is not true for every field in every nation, but it is true for many US industries.)
--Mark
 
Tim Holloway
Saloon Keeper
Posts: 22122
151
Android Eclipse IDE Tomcat Server Redhat Java Linux
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
The problem with the IT == electricity mindset is that electricity hasn't changed appreciably since the Big Bang, whereas IT is reinventing itself daily. The commodity view of IT is popular among the crowd that perennially believe that code can be ground out like it was hamburger and that hours-of-work == lines-of-code == quantity of useful software, while overlooking the fact that sheer quantity never made any program great or that after about 12 hours at work, programmers stop producing lines-of-code and start producing lines-of-bugs.
I never was big on the LOC concept anyway. I'm always working to produce smaller simpler ways of getting things done. Does this mean I have negative productivity?
However, hope springs eternel in the PHB crowd. They're convinced that the latest programming paradigm or offshoring or cramming people into puce cubicles or whatever's in fashion this week will convert was is essentially a creative process into a mechanical one.
Which overlooks the fact that when we figure out how to make a process mechanical, we turn it over to automation. Then we find something else to do that can't be done mechanically. In other words, the whole concept of a mindless machine-like workforce is inherently flawed.
 
Rufus BugleWeed
Ranch Hand
Posts: 1551
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
Let me see if I'm hearing you correctly.
We got lights, heating and A/C same as they do, it's a wash.
We got phones, a LAN and a T1 same as they do,
it's a wash.
We got Oracle and Weblogic. They have DB2 and
Websphere. Our competitive advantage is we let developers go. We're getting trained monkey's to click the mouse. Our trained monkeys are a lot less than those people they've got. And you should see how much money they spend on training their people ... :roll:
We can deliver you an Oracle and Weblogic system real cheap. We buy in bulk from Oracle and Weblogic. We pass on the savings to you.
Oh, just between you and me, my brother-in-law works in sales at Oracle. He cuts us a better deal, but he does it on the sly. So mums the word. When was you needin yore system, anyway?
 
Ranch Hand
Posts: 716
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator

In the last 20-30 years, IT has been a competitive advantage. It provided efficency and lower cost. That's about to change.


Perhaps. OTOH, perhaps we're at the point of 'creative destruction' between the crazy boom we experienced between 1998-2000 and rational IT sector growth resuming from 2003 on? Compare the current situation to that prevailing between 1980 and 1983, the last big bust in IT. Mainframes and their associated technologies had matured gone beyond their prime. Other technologies were ready to take their place in new development, but the skills distribution was skewed toward Cobol/CICS, etc. The Minicomputer (VAXen and it's competitors) was obviously (in retrospect) in it's prime. Unix/C were sunrise technologies.
The 1998-2000 boom was an anominaly and won't occur again for another 20 years. The projects which sustained much of the industry from 2000 thru 2002 were leftovers from the boom. I have seen next to no new (large) projects start since 2000. This is the bad news.
The good news is that demand for new applications has been bottled up out there behind accountants whose job is to say 'no'. The demand for new applications is there and growing every day. Once profits start growing the accountants will lose some of their power. Another piece of good news is that many or most of the fakers have left the business for greener pastures. I used to work for a 'Big 5 consultantcy', and observed two 'architects' who knew very little bail out and go to the finance practice when the IT business stopped coming. 'Addition by subtraction' in the purest form. Most of the people left in the field are already good and learning as fast as they can.
We don't need an IT 'boom' to do very well in this field. What we need is a labor market shortage. We have had very few new people enter the field since the end of 2000, and many have left for other endeavors. When growth starts again I predict a shortage of IT talent who know the new, cost-effective technology, perhaps even a major shortage.
 
Mark Herschberg
Author
Posts: 6049
2
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator

Originally posted by Tim Holloway:
The problem with the IT == electricity mindset is that electricity hasn't changed appreciably since the Big Bang.


I think you missed the point entirely. Yes electricity is still bound by the same laws of physics. By the reasoning, computing hasn't changed either. We're still bound by the laws of math which restrict computing (e.g. halting problem).
While electricity has always existed, how it's been used has changed. During the turn of the century the were scores of companies trying to create and sell it. All sorts of prorietary systems existed. AC vs DC, different voltages, different frequencies, etc. Eventually we adopted standards, but this wasn't the case early on. The smae is try with computers.

Originally posted by Tim Holloway:
The commodity view of IT is popular among the crowd that perennially believe that code can be ground out like it was hamburger...


Again, you miss the point. This isn't an article on software development, this is an article on IT. A good software program is still valuable and worthwhile and a company can make money doing it. But to non-software companies, i.e. software customers in other industries, they shouldn't see a particulare IT purchase as strategic. Their competitors can quickly adapt and mimic it. Any software company A can buy or build can just as easily be purchased or built by company B.

Originally posted by Rufus BugleWeed:
Our competitive advantage is we let developers go....


I'm starting to wonder what this NYT article said. The HBR article isn't about outsourcing. It;s about companies that buy IT resources. It makes no difference if the comapny they buy it from is in the US or overseas.

--Mark
 
Al Newman
Ranch Hand
Posts: 716
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator

While electricity has always existed, how it's been used has changed. During the turn of the century the were scores of companies trying to create and sell it. All sorts of prorietary systems existed. AC vs DC, different voltages, different frequencies, etc. Eventually we adopted standards, but this wasn't the case early on. The smae is try with computers.


We're adopting standards right now. J2EE, EJB, perhaps even MS.NET.....
I think the reaction is to the notion that a company can buy strategic advantage in bottles labled 'Seibel', 'SAP', 'PeopleSoft', etc. Or buy a combination of these products, hand them to a Big 5 consultancy for integration, and get easy strategic advantage.
That was demonstrable BS for at least two reasons. A) if it was that easy everyone could do it and it's wouldn't be strategic advantage. B) It distracted upper management from it's real role of examining the business and making the hard choices which result in real strategic advantage.
But I fail to see why HBS is so late in seeing this, it's been obvious for at least two years, or should have been. Hmmm, perhaps I should have done a Harvard MBA if the competition is that weak?

I was in Soho yesterday visiting Foyles bookstore (the best technical bookstore in London). Noticed that CGEY had vacated the premises across from the theater on Cambridge Circus, where they exhorted us to 'Defy the Economy!' for several months last year. My nominee for the dumbest radio ad ever.... I guess defiance gave out. Joseph Schumpeter's Creative Destruction at work, at long last.
 
Mark Herschberg
Author
Posts: 6049
2
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator

Originally posted by Alfred Neumann:

I think the reaction is to the notion that a company can buy strategic advantage in bottles labled 'Seibel', 'SAP', 'PeopleSoft', etc. Or buy a combination of these products, hand them to a Big 5 consultancy for integration, and get easy strategic advantage.


Who's reaction? I'm lost. The point of the article is that these are not strategic. It was 20, 10, and even 5-6 years ago, as companies adapoted computer power in the office, personal computers on the desktop, and then the internet.

Originally posted by Alfred Neumann:

A) if it was that easy everyone could do it and it's wouldn't be strategic advantage.


It was that easy. Lots of companies jumpted to the net and some enjoyed a first player advantage.

Originally posted by Alfred Neumann:

B) It distracted upper management from it's real role of examining the business and making the hard choices which result in real strategic advantage.


I think you're misunderstanding strategic advantage. Most companies don't have an advantage through IP. Most have an advantage based on their supply chain, location, partnership, marketing, customer base, etc. Being able to effective manage these, meaning efficently process the information in these veins, *is* the job of management.
--Mark
 
Rufus BugleWeed
Ranch Hand
Posts: 1551
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
Yeah I'd agree SAP and PeopleSoft may well be COTS that compete and there's no reason to roll your own.
AI, data mining, integration of legacy systems, geographic information systems, and a host of other technologies are a long way from mature, much less standardized. EJB's are a nice attempt at standardization but, IMO, moving beans from one container to the next still poses problems.
 
Al Newman
Ranch Hand
Posts: 716
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
I'm not certain we're even referring to the same thing, Mark. when I write about strategic advantage I'm referring to a competitive advantage which lasts for a longish period. This is a concept which has nothing inherently to do with IT. The Medici Bank had a strategic advantage in the early 1400's, and GM had a strategic advantage over the other car manufacturers from 1925 until about 1980. Modern examples of companies with strategic advantage include Microsoft, Dell, and perhaps Cisco. Amazon shows signs of becoming one but until they start reporting outsize profits I won't count them in.
IT can be a tool used to achieve strategic advantage, as Dell and Wal-Mart have shown. But it is only a tool.
 
Mark Herschberg
Author
Posts: 6049
2
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator

Originally posted by Alfred Neumann:
I'm not certain we're even referring to the same thing, Mark.


Yes, now you've totally lost me.
If you read my post you'll see that I agree with the author's claims that IT is no longer a strategic advantage. It was maybe 20 years ago. I think we both agree that today, IT is not a tsrategic advantage.
However note that strategic advantage is not necessarily something which lasts for a "longish period." A strategic advantage is not time sensative. A strategic advantage could come from a manufacturer develoing an exclusive relationship with a large distributor, but one which may be terminated at any time. The prevention of others from entering a market or being able to effective compete with you in that space is known as a barrier to entry. Natrually you would like take a strategic position which inherently creates and employs a barrier to entry.
--Mark
 
Tim Holloway
Saloon Keeper
Posts: 22122
151
Android Eclipse IDE Tomcat Server Redhat Java Linux
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
In theory, you buy packages solutions and they would be commodities.
In practice, I know of no organization (or even individual) that hasn't ended up customizing things to match their unique way of doing business.
When you want an air conditioner, you buy commodity items. You may plug items together in ways to suit your building complex, but you're still using stock components and basic engineering formulas. Same with lighting. The shape of the fixtures may vary and even the means of generating luminance, but the item is essentially stock, even when you have it built to spec.
You buy a copy of SAP or PeopleSoft and you end up hiring someone expensive to custom-program it to fit corporate needs. In fact, SAP was originally more rigid, but customers didn't like it that way.
Until such time as businesses stop creating Excel spreadsheets full of custom VBA logic, intranet apps that glue together the various feuding departments, and G/L systems that have to deliver custom reports via SSL to Philadelphia, IT isn't going to be a commodity - it's going to involve developers to some degree or other and the creative process.
I have a James Martin book entitled "Application Development Without Programmers" where he posited the concept of Power Users (he called them "acrobats") doing the Excel spreadsheets and using various tools such as the now-obsolete Nomad system. Since the book's copyright date is 1982, this is actually before the existence of Word and Excel, much less VBA. He did consider APL a "user" language though . :roll:
An awful lot of custom software has been written since then by the supposedly-obsolete developers. And I've certainly done my share of adapting Excel macros that have exceeded the ability of non-IT people to manage or integrate into the overall corporate IT framework.
So I'm not ready to buy into the "IT-is-a-commodity" concept just yet. I've found it to be more of a "choose-your-battles" world.
 
Mark Herschberg
Author
Posts: 6049
2
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator

Originally posted by Tim Holloway:
In practice, I know of no organization (or even individual) that hasn't ended up customizing things to match their unique way of doing business.


I'm treating this as a seperate topic, because I see the issues of IT value and IT commoditization as orthogonal.
Commoditization is not a black and white issue. Customization does not imply that it is not a commodity. Cars, for example, are "custom built." Some people even do their own additional modifications. Cars are a commodity.
Industrial equipment. (Some) Industrial equipment is a commodity. This isn't something you simply order off the shelf, and often involves customization and specific installation requirements. Nonetheless, it's a commodity in that some of it is provided by multiple vendors and performs similar functions.
Engineering. I have a friends who work in engineering consulting firms, from 20-2000 people. These people get contracts from large companies like IBM, Boeing, DoD, etc. They are a commodity. The customer chooses from scores of engineering teams. Each team will probably produce a different product; and ahead of time the customer doesn't know what the result will be.
Obviously engineering is very different from fast food hamburgers. It wouldn't describe them as the same product, but I wouldn't put them on the opposite end of the spectrum either.
--Mark
 
Tim Holloway
Saloon Keeper
Posts: 22122
151
Android Eclipse IDE Tomcat Server Redhat Java Linux
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator

Originally posted by Mark Herschberg:

I'm treating this as a seperate topic, because I see the issues of IT value and IT commoditization as orthogonal.
Commoditization is not a black and white issue. Customization does not imply that it is not a commodity. Cars, for example, are "custom built." Some people even do their own additional modifications. Cars are a commodity.
Industrial equipment. (Some) Industrial equipment is a commodity. This isn't something you simply order off the shelf, and often involves customization and specific installation requirements. Nonetheless, it's a commodity in that some of it is provided by multiple vendors and performs similar functions.
Engineering. I have a friends who work in engineering consulting firms, from 20-2000 people. These people get contracts from large companies like IBM, Boeing, DoD, etc. They are a commodity. The customer chooses from scores of engineering teams. Each team will probably produce a different product; and ahead of time the customer doesn't know what the result will be.
Obviously engineering is very different from fast food hamburgers. It wouldn't describe them as the same product, but I wouldn't put them on the opposite end of the spectrum either.
--Mark


That's pretty much a restatement about what I said regarding custom lighting. You can mix and match, but the end result is mostly determined by cookbook formulas. The differences are mostly on the surface, and even there, they're mostly a matter of plugging in different sets of numbers into a the molding machinery.
In contrast, the most generic software objects are still likely to be more plastic than even the components used in the relatively un-commodity-like process of designing a new jet aircraft engine.
We have many more stock objects to hook into than we did 30 years ago, but we still haven't managed to get them to the cookbook point, despite the best efforts of the silver bullet seekers for longer than I've been in the business.
I'm afraid I can't help but note also that customized objects, whether cars or light fixtures do tend to carry a premium price. Even in those cases you don't get the creative process for free.
 
My pie came with a little toothpic holding up this tiny ad:
Devious Experiments for a Truly Passive Greenhouse!
https://www.kickstarter.com/projects/paulwheaton/greenhouse-1
    Bookmark Topic Watch Topic
  • New Topic