War of words

It was billed as the Rumble in the IT Jungle. And to be fair, there was at least one similarity to the legendary Ali-Foreman bout in Zaire: It involved two guys.

Heavy thinkers Nicholas “”IT Doesn’t Matter”” Carr and Don “”The New Normal”” Tapscott duked it out last week downstairs at the CN Tower

in a debate hosted by SAS and Intel. (Alanis Morrissette alert: Isn’t it ironic to schedule an event at the world’s tallest freestanding structure and actually hold it in the basement? Discuss.) The subject: Carr’s willfully misinterpreted body of work on the declining strategic significance of information technology.

(Before the bell, I asked someone wearing a SAS name tag if the event was a debate or a lynching. “”I think it’s a lynching,”” he replied. “”You realize I have to quote you on that,”” I said. “”Um … no.”” So there you go– I didn’t.)

To be fair, Carr brings a lot of misguided criticism on himself. Carr is the Harvard Business Review editor-at-large who penned a controversial essay in 2003 called IT Doesn’t Matter. He’s since turned it into a book, and a movie starring Tom Skerritt as the charming but vaguely ominous CEO and Tom Hanks as a harried technologist can only be around the corner.

The major flaw in Carr’s essay is the inappropriate and irresponsible title. Carr never argues that IT doesn’t matter. His argument can be summed up by a short passage from the essay: “”When a resource becomes essential to competition but inconsequential to strategy, the risks it creates become more important than the advantages it provides. Think of electricity. Today, no company builds its business strategy around its electricity usage, but even a brief lapse in supply can be devastating.””

(If I’m not mistaken, the last company to do something innovative strategically with electricity was Enron.)

IT has matured as an infrastructure. When everyone has it, it’s harder to wring strategic advantage out of it. But you’re at a competitive loss without it. This is Carr’s message. Unfortunately, few people bothered to read past the title before condemning him as a heretic.

Those who did found an essay with some simple advice: spend less by separating discretionary and unnecessary investment from the necessary, don’t go bleeding edge, and focus on vulnerabilities, not opportunities.

That’s the fight he brought to the ring Wednesday, in front of an unfriendly crowd with whole careers and lives wrapped up in the notion that IT does matter.

Tapscott, the business technology visionary and home crowd favourite, opened his sly offence with an attack on Carr’s infrastructure analogy. When Carr compares IT to railroads and the electricity grid, he isn’t taking into account the value of the information that infrastructure carries. Better technology means better information, better information means better business decisions, ergo …

Opening up a chink in Carr’s armour, Tapscott tried to pour in another attack on Carr’s infrastructure argument. Carr says a bit of information – infinitely and perfectly replicable – is the perfect commodity. Exactly the opposite is true, said Tapscott; a bit can be a baby picture or a billion-dollar bank transaction. The judges scored extra points for the effective alliteration, and Tapscott tried to close the deal with a flurry of 15 strategic differentiators to the solar plexus.

Unbowed, Carr came up swinging. “”I’m really in awe … of Don’s ability to dodge the question,”” he shoots back, but it’s a glancing blow. There’s more where that came from, though. In Tapscott’s analysis, Carr said, flour is a strategic resource to baker. Then Carr tries to take the crowd – largely SAS employees, partners and customers – out of the match: “”There’s no doubt IT matters strategically – if you’re a technology company.””

This bought Carr enough time to launch a well-reasoned offensive. Banks that tried to take early advantage of the online channel to reach customers spent a fortune developing functionality that would be available shrink-wrapped from vendors in short order. The bigger the investment required for real competitive advantage, the longer the window of proprietary use has to be to make it worth that investment.

When the bell rang, one thing was clear – in practical terms, the two aren’t as far apart as they sound. Both advocate smarter IT spending, Carr by focusing on technology necessary for competitive parity, Tapscott by spending less on “”a-competitive”” and more on strategic investment. IT does matter, and that should never have been the question in the first place.

Expect a rematch soon. Carr’s coming article for MIT Sloan management Review is to be called The End of Corporate Computing.

The man’s got a way with a title.

Dave “”Don’t Hit Me”” Webb has taken one too many blows to the head.

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