Untitled document.docx



Itobore OdjeDr. Claudia Skutar English 20891 April 2014Has Information Technology Lost its Competitive Edge?Information technology is very important in the business world. Information technology is very important to the architecture and structure of businesses. Businesses rely heavily on information technology in order to be successful in day-to-day activities, such as the HR. In the competitive sense, it makes sense for information technology to serve as a base is for competitiveness against other companies. But a man by the name of Nicholas Carr gave a new idea that information technologies purpose no longer serves businesses as a competitive edge. Nicholas Carr, who writes primarily about technology, culture and he also is a former executive editor of the Harvard Business Review. His idea that information technology no longer serves the purpose competitively opened up a floor for discussion. Of course the floor for discussion had people who agree with him and people who disagree with him. He proposed his new idea in 2003 and is now 2014, and this issue is still getting light. I will have to say that I am one of the people who do believe that information technology serves a business competitive. Until this day Carr’s ideology still holds weight, and company executives are taking what he said to heart. I think that IT is one of the most important things in a business especially large companies, IT can serve as what makes a company better than another company. What exactly is information technology? Information technology is a very broad term. In the corporate world where there are businesses there is always some type of information technology support. In larger companies there will be IT departments, the department is responsible for maintaining applications that people in the business use. Some companies even make applications for their customers to use depending on the type of company is. For example I work for an insurance company, it isn’t typical insurance company, it is a different type of insurance such it is property and claims. The IT department’s purpose is to support business applications that the people who write the claims and policies use. You can see that the use of an IT department is crucial to a company’s success.Carr argued that IT no longer gives businesses a competitive edge. One of his points was that IT cannot be a source of competitive advantage because is available to everyone. Another point he made was that IT is only infrastructure, which is dealing with only hardware and software. Another argument is that too much money is being spent on IT departments and that it is not improving its competiveness. The next argument is that since IT is not a competitive advantage that companies should only use what the company needs and not explore other options which means no innovativeness. If you think about the overall aspect of all of points not supporting IT as a competitive advantage you can see that there are many holes. IT is important to businesses competitively, I am going to argue that not all IT is available to everyone, IT is not just infrastructure, the amount of money spent on IT can help businesses compete, and companies should explore other technologies with their allocated budget.Why is this issue important? In the article “Can Information Technology be a Source of Competitive Advantage” by Lidja Breznik, she outlines how the overall concept of IT is difficult to grasp in terms of the competitive advantage it offers. Breznik is currently a business development manager and has worked in the information technology industry for over five years also she was a professor at the University of Ljubljana, which is located in Slovenia. Breznik says that Nick Carr’s article has had such a great impact on the IT community and the argument is not simple (Breznik 252). Like Breznik, I am opening up the am opening up the floor for discussion and reflection for IT professionals to see both in the of the spectrum but I am strongly disagreeing with Nick Carr’s article and ideology. When Nick Carr wrote this article he did it with disregard for the future. IT is and continues to be a very important part in everyone's lives so for Carr to go out on a whim and say IT does not matter whether it is competitively or not is outrageous. This brings up one of Carr’s points that IT cannot be a source of competitive advantage because it is available to everyone. IT is readily available but companies can now leverage the use of new technology when they find the need too. When Carr first adopted his ideology that IT no longer gives companies a competitive edge, he was very narrow-minded about the issue. He did not even account that technology is forever changing and while IT is available to everyone what works for some businesses may not work for other businesses. There may be 1 million different technologies, but a business decides to use a certain kind of technology for leverage against competitors in their industry. For example, the government, when speaking in terms of government the time can be very broad. In terms of technology with the government that term can also be very broad but there are a lot of grounds for the use of technology. Under the government are lots of types of agencies; the agencies can be public, private, nonprofit sectors, and also government contracted work default under the category. In terms of competitiveness it specifically comes down to government contracted and nonprofit work, although public and private sectors compete but it is in a different way. Asghar Zomorrodian’s paper on “The Impact of New Information Technology (IT) on e-Government and other Organizational Innovation,” Zommorrodian is a professor and a faculty advisor for a graduate program and undergrad program at the University of Southern California. In the paper, he speaks about how the government uses IT in the benefits of what it can become in the future (Zommorrodian). When Carr said that IT couldn’t be the source of competitiveness in businesses because it is available to everyone, he forgot one thing that not all companies are going to use the same technology. Zommorrodian states that all IT technologies available will not work for every agency and for that simple fact the agency is going to have to find what works for them and what makes then successful and competitive in the market (Zommorrodian). Finding the technology that makes a company stand out from other companies is important for businesses because in turn it makes IT one of the reasons giving companies a competitive advantage.The same type of technology cannot be available to everyone, especially if it is not free. Some technology is very expensive to utilize. A larger company has a bigger budget for the IT department which allows for those companies to leverage new technologies that may be expensive initially. In the journal The Review of Business Information Systems written by Gilbert et al. backs up the fact that technology is not available equally to everyone and that has to do with execution (Gilbert et al. 177). Some companies may learn how to use a specific technology well. But then there are the other companies that try to use the same technology and fail. When there is a new technology there is not always going to be a lot of people that know it well, so in a sense it is not available to everyone. IT is not available to everyone because everyone cannot afford it afford, or choose not to spend money on cutting edge technologies. IT is also not available to everyone because sometime companies lack the expertise to make the technology work for the company. Carr said IT is only infrastructure and infrastructure is just hardware and software but I know that IT is so much more than just infrastructure. There is a transcript of an argument between Nicholas Carr and Chief Information Officer (CIO) editor in chief Abbie Lundberg in which Carr focuses primarily on IT as an infrastructure in his argument. Carr believes it makes more sense to manage IT as a commodity input, because the ability for a company to use IT in a distinctive way to gain a competitive edge will diminish, and isn't going to set a company apart from competitors (84). Why put IT as a commodity input when your company has the resources to continually produce products that will be successful on the market? IT is not a commodity because a commodity in the business world would be a service that is easily exchangeable for another service just under a different name; it is comparable to a person changing electric companies. Because Carr said that IT is only infrastructure he left out the fact that there is much more to it than hardware and software. Thinking of it the way Carr sees it; IT could essentially be used as a commodity. In the Journal of Business & Industrial Marketing an article written by Ricky Ryssel et al. titled "The Impact of Information Technology Deployment on Trust, Commitment and Value Creation in Business Relationships" states that IT expands into communication systems as well as hardware and software. The article also states that IT has increased immensely over the years (Ryssel et al. 197). Since IT has increased over the years it means that it will always continue to increase. Another thing the article by Ryssel et al. states is that the IT department should have a good relationship with the business (Ryssel et al 200). If the IT department has a good relationship with the business means that that the department is 100% behind what the companies wants and delivering in the best possible results. The companies who do not have the resources to compete will use what they can until there are able to compete on the same scale as their counterparts. In the argument between Carr and Lundberg, Lundberg states that Carr cannot make a distinction between infrastructure and the applications that ride on them (85). Lundberg is saying that Carr cannot differentiate the IT infrastructure and applications that ride on infrastructure instead Carr is saying that infrastructure and applications, which would be primarily software, are one. Once again IT is just not infrastructure. IT is much more than infrastructure it goes beyond hardware and software.Another argument made, was that too much money is being spent on IT and it is really not providing a competitive advantage. When you look at the organizational structure of a company, each division gets allocated money for their function. It is up to the executives, primarily the chief financial officer (CFO), to make decisions on how that money is allocated. Depending on the company it may be to their benefit to allocate more money for IT. CarMax is a one-of-a-kind company; the company gains much of its revenue by strictly selling used cars. CarMax also knows the values of their IT department. CarMax offers a leadership program to their IT employees that will allow them technical training. This means that CarMax is putting a lot of money into their IT department specifically on the employees because they know that such training is done so that the employees will be equipped with the proper skills to succeed (Information Technology Business (ITB)). More importantly the company can succeed and benefit competitively from their employees. From personal knowledge, I know the rewards of a company that invests greatly in the IT department and even if people think that too much money is being spent on IT and it is not really providing a competitive advantage, then why hire a Chief Information Officer? An article in Network World written in by Ann Bednarz is about how Carr think that less money should be spent on IT because technology changes all the time, and by the time a company has fully utilized the technology it will become obsolete (Bednarz). Often in non-technology based companies, information technology is a slow process. When cars that are less money should be spent on IT he was in the mindset that the utilization of the technology would be a slow process. While it is a slow process and non-technology-based companies, companies that invest well in the IT departments do well, as the given example above CarMax. Also when Carr generalized that technology often becomes obsolete he didn’t have in mind that there would be more technology-based companies. Facebook, LinkedIn, and Google are all technology and social media-based companies that invest a lot of money in their technology because it is what runs their company. The technology-based companies invest in technologies that would benefit the people who used their products, which are generally everyday people. Companies of this sort are always using cutting edge technology because the everyday user once to get the most out of technology. Technology-based companies and non-technology-based companies both need to continue investing money and their technologies because it is what is going to set them apart from their rmation technology today, is built off of the foundation of innovation. To me innovation is seeking out the best possible solution to a problem, an idea, or concept that changes the way we as humans’ function in every day life. As time goes on technology remains the same in some aspects the only thing that change is, is that innovativeness of the idea. For example, how we listen to music today and how people listen to music 20 years ago has totally changed but people are still listening to music. IT works in a similar way to how people how to change the way they listen to music, in fact the way people listen to music now specifically has to do with technology. Another argument was that companies should only use the resources available to them. When companies forced our use only the resources available to them it creates a block on innovation. Innovation is what sets different technologies apart from each other. Companies should utilize outside resources especially the resources have the ability to transform their business, and take their business to the next level of competitiveness. In the journal The Review of Business Information System, written by Gilbert et al., explained how Carr said innovation has stopped. The article goes on to say the innovation and the technology has not ceased but remains vibrant as time goes on (Gilbert et al. 178). Carr was really not thinking of the future at all and his thought process was very narrow-minded. How could Carr say that innovation has ceased? Innovation is this thing that keeps industries competitive especially from the information technology aspect.The article “Administering Information Technology Capabilities And Competitive Global Business by Preventing Replication of Technology Portfolio”, which was published in the International Journal of Innovation, Management and Technology, is about how the internal and external factors of IT will improve economic performance if they are properly monitored and simply the ways IT can add an advantage. Internally an organization should support innovativeness in order to produce the best product (Williams et al. 622). When the best products are produced it creates competitiveness in the industry especially where there is great innovation. The producing of great products allowing a market where the best products are available for usage and openly available if the company chooses to use it. I am a big supporter of companies supporting innovation period, whether it be in the IT department or not. Innovation creates opportunities that may not be initially thought of. When you think about it a lot of the new companies that have started recently have all had a technical backing. For example Square, square developed a hardware tool that can be paired with a cellular phone or any device that can download applications. Car saying the innovation has ceased really doesn't make sense because of all the technology that is constantly being produced. I don't even know how some people still agree with him, companies like Square prove that innovation has not ceased. Often times when startup companies occur businesses go out and tried to buy the startup company. That an example of a company going out of its way to get resources and the best technology and not using the technology that is solely based in the company. Expanding outside of the company's resources and innovation are very important factors in the ability for a company to have a competitive advantage over other companies. Company should utilize outside resources and innovation can be brought to any industry. In the Journal of Hospitality and Tourism Technology an article named “Information Technology Applications and Competitive Advantage in Hotel Companies” written by Anil Bilgihan et al., give insight on how hotel companies could use IT for their leverage for competitiveness with other hotels by using a theoretical framework on IT applications (Bilgihan et al. 39). The article presents an innovative theme to get hotel companies to think about how they could use information technology to their advantage competitively. Typically hotels do not have great emphasis on the IT in their operations. Having others see the benefits of using more IT in their operation can produce better business. The idea in itself is very innovative and requires hotels to explore outside of their resources. Carr thinks IT no longer serve the business competitive edge but Bilgihan et al. believe that is the IT used is valuable, rare, inimitable, in non-substitutional in terms of value and resources, then it does create a competitive advantage over other companies (Bilgihan et al. 146). It creates a competitive advantage because it is allowing hotels to explore innovative options IT solutions that set them apart from other hotel companies. Companies utilizing outside resources and harboring innovation is very important if it is with in the means of the organization's budget. It will allow the companies to have a competitive advantage over other companies in similar rmation technology is important to businesses and plays a major role in adding a competitive advantage. IT is available to everyone, IT is not just infrastructure, the amount of money spent on IT can help businesses compete, and companies should explore other technologies with their allocated budget. Companies should always be looking for new ways to keep their business technology fresh. In the Interdisciplinary Journal of Contemporary Research and Business written by Minwer Al-Adwan et al., says that businesses should keep pace with rapid changes in the field of information technology (Al-Adwan et al. 418). Keeping up with the rapid changes is this yet another way IT can help companies add a competitive advantage.Works CitedAl-Adwan, Minwer, and Ziad M. S. Almashaqba. "EVALUATION THE ROLE OF INFORMATION TECHNOLOGY IN BUSINESS VALUE PERFORMANCE (BVP)." Interdisciplinary Journal of Contemporary Research In Business 4.6 (2012): 404-20. University of Cincinnati Database (ProQuest). Web. 4 Mar. 2014."The Argument Over IT ; Author Nicholas Carr and CIO Editor in Chief Abbie Lundberg Go Toe- to-Toe on the Strategic Value of IT." CIO 17.14 (2004): 84-88. University of Cincinnati Database (ProQuest). Web. 4 Mar. 2014."CarMax, Inc.; CarMax Named One of Computerworld's 100 Best Places to Work in Information Technology." Information Technology Business (ITB)(2008): 56. University of Cincinnati Database (ProQuest). Web. 4 Mar. 2014.Bednarz, Ann. "Nick Carr's 'IT Doesn't Matter' Still Matters." Network World (Online) (2013) University of Cincinnati Database (ProQuest). Web. 4 Mar. 2014.Bilgihan, Anil, et al. "Information Technology Applications and Competitive Advantage in Hotel Companies." Journal of Hospitality and Tourism Technology 2.2 (2011): 139-53. University of Cincinnati Database (ProQuest). Web. 13 Mar. 2014.Breznik, Lidija. "CAN INFORMATION TECHNOLOGY BE A SOURCE OF COMPETITIVE ADVANTAGE?" Economic and Business Review for Central and South - Eastern Europe 14.3 (2012): 251-69. University of Cincinnati Database (ProQuest). Web. 13 Mar. 2014.Gilbert, Arthur H., Jr. Pick Roger Alan, and Sidne Gail Ward. "Does "IT Doesn't Matter" Matter?: A Study of Innovation and Information Systems Issues." The Review of Business Information Systems (Online) 16.4 (2012): 177-80. University of Cincinnati Database (ProQuest). Web. 4 Mar. 2014.Ryssel, Ricky, Thomas Ritter, and Hans Georg Gemunden. "The Impact of Information Technology Deployment on Trust, Commitment and Value Creation in Business Relationships." The Journal of Business & Industrial Marketing 19.3 (2004): 197-207. University of Cincinnati Database (ProQuest). Web. 4 Mar. 2014.Williams, Harshit Eric, and Birendra, Kumar Shah. "Administering Information Technology Capabilities in Competitive Global Business by Preventing Replication of Technology Portfolio." International Journal of Innovation, Management and Technology 4.6 (2013): 619. University of Cincinnati Database (ProQuest). Web. 4 Mar. 2014.Zomorrodian, Asghar. "The Impact of New Information Technology (IT) on e-Government and Other Organizational Innovations”. University of Cincinnati Database (ProQuest). Web. 4 Mar. 2014. ................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download