Bus206 4.1.1

  • Summarize Carr’s argument that IT does not bring competitive advantage.
    • Carr views IT as a commodity that should be managed to reduce cost and risk as much as possible. He argues that IT is no longer a differentiator because it is so commonplace. Since the two components of competitive advantage are cost advantage and differentiation advantage, and IT is not unique enough to confer a differentiation advantage, its cost should be kept as low as possible to gain or maintain cost advantage.
  • Do some independent research and explain the current thinking on the ability of IT to provide competitive advantage.
    • IT can be leveraged to provide competitive advantage, but it must be used in conjunction with thoughtful business processes. Advances in IT allow customer service representatives to aggregate data on customers, and artificial intelligence can provide automated customer service, meaning that customer questions and concerns can be responded to faster than ever before. Additionally, the availability to virtual conferencing software allows teams to collaborate worldwide, sharing resources and knowledge throughout the organization. However, if these technologies are implemented without organized processes for maximizing their benefit, they may add little more than infrastructure cost.
  • What is your position on IT and competitive advantage?
    • My position is that IT provides many useful tools for businesses to succeed, but it is ultimately the business’ responsibility to learn how to most effectively use those tools. An unskilled person can have the best power tools on the market and still not be able to build a house with the speed and quality of an experienced carpenter with hand saws. Similarly, businesses will never be able to take advantage of the utility of IT unless they create and actively maintain processes that enable success.