IT does matter, says Autonomy chief

Autonomy chief executive Mike Lynch has labelled a recent article in the Harvard Business Review which asserts that innovation in IT won't provide competitive advantage as stupid and "fundamentally wrong".

Speaking at the European Technology Forum Technology Summit event in London on Thursday, Lynch, hailed as the UK's first Internet billionaire, joined the throng of industry figures, including Sun boss Scott McNealy and Microsoft chief executive Steve Ballmer, who have attacked author Nicholas Carr's "IT Doesn't Matter". article

Lynch claimed Carr's assertion -- further investment in IT innovation is pointless as existing systems are good enough -- missed the point. "The assertion is that IT works perfectly well and all systems are doing what they are supposed to do, so there's no advantage in adding any more. But I come from a different planet -- if you analyse what's been happening in IT for the last two years then you get a very different picture." he said

Lynch then presented a series of statistics from leading analyst groups detailing the failure of various IT technologies such as CRM and claimed this was evidence that IT was not fulfilling the needs of business.

He conceded that if information technology is seen as just being about technology, then Carr's thesis makes sense: systems like the relational database do as they should -- so why spend money trying to improve them? "Relational databases do work perfectly well most of the time -- maybe they are becoming commoditised."

But he then asserted that IT is also about information -- and from this perspective, existing systems were nowhere near meeting users' needs, thus rendering Carr's claims, that IT does everything it needs to already, redundant. "Eighty percent of information in companies is unstructured and modern technology does nothing for it," he claimed. "In terms of solving information technology, we have barely scratched the surface."

Carr's article, in the May 2003 edition of the Harvard Business Review, asserts that IT -- as with technologies such as the railroad and the electric generator -- gave forward-looking companies a brief advantage but as the availability has increased and costs decreased, it has become a commodity and from a strategic standpoint, no longer matters.

The Harvard Business Review editor-at-large claimed that IT management should "frankly become boring" and focus on reducing risks, not increasing opportunities."Companies can't get any competitive advantage from IT but you can get a competitive disadvantage. You should innovate less and be followers, let your competitors spend the money."

According to Lynch, IT is about information flow, no matter what the source or type, within the organisation and should not simply be seen as "the database plus". "Most of you are IT managers and probably don't think that telephones have anything to do with you -- and I am not just talking about Internet telephony -- but in five years you'll be dealing with them all the time."

For the full interview with Mike Lynch, click here.