Nicholas Carr: IT still doesn't matter

Last week, Carr told an audience in London that companies have been misled to believe buying technology can make them more productive.

He said: "Smaller firms are more productive than large firms and yet they have less technology." And though he conceded it would be naïve to assume that represents the grounds for a hard and fast rule, he added it should at least "lead anybody to question the importance of IT."

Carr said: "Companies should spend less on IT." "But when I say spend less I don't mean use less or get less," he added, saying companies need to reduce their vulnerabilities when buying IT - such as over-spending or buying into expensive projects that ultimately fail to deliver.

He said: "Successful IT management comes down to successful management and not just those who are more innovative or take more chances."

As such he said companies should resist the urge to buy new technologies and should discard any notion of the cutting edge, saying there are few companies likely to see competitive advantage by being an early adopter.

He added: "The vast majority of companies should be IT followers not IT leaders. The innovator is going to pay a lot more than those who follow in the innovator's wake."

Though one might expect Microsoft to wholly reject Carr's ideas, Bob McDowell, VP of information worker business value at Microsoft, admitted the industry and business customers haven't always done themselves any favors.

He said: "There was over-hype in the 90s and there was overspend." And he added that the IT industry is "still paying the price now".

James Governor, analyst at Red Monk, said Carr's comments are welcome in an industry that is short on "comedians". But he said there is also a greater relevance to some of Carr's words. Governor said: "Frankly we should all be shifting uncomfortably in our seats," adding Carr's words should ring true with many people who may rather forget past over-spend or poor buying decisions.

While he said it's unlikely any CIO "will stand up at the end of the year and say 'please reduce my budget'", Governor said businesses should be savvier.

He said: "All businesses should be harder when it comes to negotiating with their vendors. Bring in the procurement people and the legal people and don't worry about losing control of your IT spend."