Amazing but true: Harvard man claims IT does matter

The question has often been asked, usually quoting studies from Harvard, “Does IT matter?” In this note, Jyoti Banerjee of KiteBlue investigates research from Keystone’s Marco Iansiti that claims IT, when properly done, delivers profitable sales growth in mid-sized businesses. Iansiti turns out to be a Harvard prof....

Robert Solow is a Nobel Prize-winning economist from MIT who studied US productivity in the 80s and 90s. In these seminal decades, which saw the establishment of widespread ubiquitous computing, Solow could find no evidence that US productivity had been impacted in any way, positive or negative, by technology. This was bad news for an IT industry trying to position itself as a supplier of strong business benefits.

Then Nicholas Carr of Harvard wrote a book entitled “Does IT matter?” where he opined that IT matters in a utilitarian way, in the same way as businesses benefit from electricity or air-conditioning.

For businesses that had spent mega-millions on failed IT projects or stagnant ERP systems, these views made a lot of sense.

Yet, in another sense, these views seemed rather incomplete. After all, there are numerous examples of organisations that have exploited technological opportunities to transform the rules in their industries to their own competitive advantage: Dell, Federal Express, Amazon, and Tesco come to mind. Of course IT matters to these organisations. So why can’t we see the evidence that IT matters when we look across an entire economy?