Carr: IT Doesn’t Matter Week 1 Summary Carr: IT Doesn’t Matter

CALGARY, AB Alina Kalinina BOSSIER CITY, LA Charlie Burgess STARKVILLE, MS Andrew Miller Blaise Carabello Blaine Wohlgemuth Chris Eady Misty Nabors Melanie Powell Paula Underwood Shan Xiao WICHITA, KS David Hartley COLORADO Hayden Djuric GERMANTOWN, TN Michael Phillips

1) Strategic Importance of IT “Carr sees IT strategic reliance is an issue since IT has today (and back in 2003 when he wrote it) was becoming so ubiquitous, it's near impossible to find any differentiation from the competition through it. When every company has IT resources, web pages, online stores, etc., investing heavily in those for an advantage is foolhardy.” – Charlie Burgess “IT has become essential for conducting business, and when something becomes essential, it can no longer provide an advantage. Carr best explains his point when he compares IT to electricity.” – Melanie Powell Carr: IT delivers more capacity (processing, storage, bandwidth, etc.) than most businesses need Prices low enough, everyone can afford them

2) Any advantage from IT? First Mover Advantage “The advantage to be gained relies on what a company makes of their IT investments.” – Chris Eady “Carr (2003) drives home the idea that the early proprietary stage of Information Technology is where companies can take hold of a long-term position of competitive advantage. During this phase, companies that utilize the innovativeness of the IT can create a relation with its customers that lasts over time.” – Misty Nabors “He believed that IT once helped gain an advantage as infrastructure technology did when access to technology has been limited due to some reasons such as high cost and lack of standardization.” – Shan Xiao First Mover Advantage More on competitive advantage in Week 2

3) Commoditization Carr: Homogenization, highly replicable “Commoditization refers to the phenomenon of the unique market offerings becoming widely available and affordable, which in return forces them to lose their strategic value and to be viewed as simple commodities.” – Alina Kalinina “Commoditization refers to the business idea that an product or service that is provide has attributes and capabilities that will one become common ideas to the general public instead of the new and exciting that they once where.”– Hayden Djuric Carr: Homogenization, highly replicable Painting IT with a broad brush? Buildout – Critical Mass of certain technologies

4) Current Technology in Danger? “Cloud hosting, be it for websites, software as a service, platform as a service, infrastructure as a service, etc. I would say these are already commoditized, as they are non-unique services sold for similar prices at a wide range of providers.” – Andrew Miller SEE ALSO: David Hartley, Michael Phillips, Paula Underwood “Square might be in danger of being commoditized or one could even say that it is commoditized given that it is so inexpensive an affordable for the average company to use.” – Blaise Carabello “I've always thought communications is a weird topic when it comes to technologies. I believe in a since it has already become commoditized but yet we are always looking to communicate better. This strikes me because not everyone communicates the same way, so different programs are used to suit different needs.” – Blaine Wohlgemuth

5) Agree / Disagree? Agree Disagree 5 8 Carr’s suggestions: Spend less on IT Follow instead of innovate “Second mover advantage” Focus on vulnerabilities Agree 5 Disagree 8 Previous Results: 2016 – 10 Agree, 7 Disagree 2014 – 11 Agree, 10 Disagree 2015 – 8 Agree, 11 Disagree 2013 – 18 Agree, 14 Disagree

Agree? Disagree? Maybe when it was new and expensive it gave an advantage, but any new business would be crazy not to have IT because all the other businesses do. It is a necessity in today's world and I don't disagree with this article. However, I can see how in 2003 when it was really hitting its stride there would be nay-sayers. - David Hartley We have entered a time where new companies that are enabled by IT solutions are able to become disruptors within their industry and become significant players quicker than ever before. - Michael Phillips He wrote this article at the end of the 'Dot-Com Burst', a time at which the IT world seemed to be coming to a halt. Once the rubble was cleared away from that, things slowly began to pick back up again, in smarter ways than before. - Paula Underwood I also believe that Carr gives managers good advice when it comes to purchasing new IT, namely to control spending, buy older products so you get more for what you pay for, and to prepare for the worst. - Melanie Powell

6) Reaction to Criticisms “While all three statements are somewhat over-board, I do side more with the four gentlemen than with Carr.” – Alina Kalinina “The professor brings up a good point that there are a lot of common things that may seem unnecessary due to the definition of commoditization, but I think instead commoditization is saying that something has become common and simple to people, however it doesn't say that its not necessary and important, just that it has become so common we don't think about its importance.” – Hayden Djuric “I think we need to be careful to write things off like this completely. What’s most important in the business world is that work is done effectively. If IT helps with that, then great! But if you’re just spending money on IT because it makes you feel better about your company, then maybe you need to rethink things.” – Chris Eadt “If we as a society did not desire more or harness innovativeness, we would have plateaued already. As history shows, we have been in constant progression. These things that became a commodity did not end, they just became a necessity.” – Misty Nabors

“Laws” in Information Technology Moore’s Law Processing power doubles every 18-24 months, while cost remains constant Metcalfe’s Law Value of a network = (Number of users)2 Network Externalities Critical Mass Gilder’s Law Bandwidth grows 3 times faster than processing

Week #2 Sustainable Competitive Advantage and Information Technology Intro Video Response Questions (due Friday) Managerial Decision-Making Reports Last day to add class: Aug. 26 First come, first serve Email your choice to kent.marett@msstate.edu