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C h a p t e r

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I n f o r m a t i o n T o d a y

LEARNING TRACK 1: HOW MUCH DOES IT MATTER?

In May 2003, Nicholas Carr, an editor at Harvard Business Review, wrote an article titled “IT Doesn’t Matter,” which stirred significant debate in the business community. Carr’s argument in a nutshell is that because every firm can purchase IT in the marketplace, because any advantage obtained by one company can easily be copied by another company, and because IT is now a commodity based on standards (such as the Internet) that all companies can freely use, it is no longer a differentiating factor in organizational performance. Carr argues that no firm can use IT to achieve a strategic edge over its competitors any more than it could with electricity, telephones, or other infrastructure. Therefore, Carr concludes, firms should reduce spending on IT, follow rather than lead IT in their industry, reduce risks by preparing for computer outages and security breaches, and avoid deploying IT in new ways. Most management information system (MIS) experts disagree. As we discuss later in this chapter and subsequent chapters throughout the book, research demonstrates that there is considerable variation in firms’ ability to use IT effectively. Many highly adept firms continually obtain superior returns on their investment in IT, whereas less adept firms do not. Copying innovations of other firms can be devilishly difficult, with much being lost in the translation. There is only one Dell, one Wal-Mart, one Amazon, and one eBay, and each of these firms has achieved a competitive advantage in its industry based in large part on unique ways of organizing work enabled by IT that have been very difficult to copy. If copying were so easy, we would expect to find much more powerful competition for these market leaders. Although falling prices for hardware and software and new