Article Review

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  1. 1. Summary

The article by Carr (2003) appeared in Harvard Business Review in 2003. It looks at the IT  and its importance to businesses. Here the author is trying to dispel the thought that IT is an important strategic tool for organizations. He believes that IT is a technology adopted to facilitate business. The role of IT is to ease the flow of information. He compares it to railroads and electricity and he asserts that just like railroads and electricity it gives the most advantage and utility when it is shared. He differentiates technologies into two: the proprieties technologies and the Infrastructure technologies. IT according to Carr an infrastructure technology which is now being used more homogenously and its market are becoming more stable as compared to the past. The advantages can be derived by those who avail the opportunity at the right time. Because according to the author the window of opportunity is very limited and only those who have availed it at the right time are the one who profits from it get an advantage and this possible in the Buildout phase only.

Therefore IT like electricity, in the long run, cannot provide any competitive advantage. Although it is important as part of operations the advantage can only be in terms of cost advantage. IT can only be a differentiating factor in the case where it is scarce, because as soon as it becomes accessible to everyone the advantage vanishes. IT according to Carr has now become a commodity which is accessible by all and as it has become increasingly widespread the price of information disbursement has gone down as it is easily replicable. The author points to several points including the fact that investment bubble has burst which shows that the IT like other infrastructure technologies is now stabilizing. IT is essential for businesses to be competitive, however, on the other hand, its strategic importance becomes minimum, and so the businesses have to become defensive about their IT systems and the costs associated with them. Organizations need be more efficient and less wasteful when it comes to investing in IT and computers.  In addition, in the end, he believes that IT management will also gradually phase out as organizations realize its lack of strategic importance.

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