Microsoft: Why IT still matters
Published: 14 Jul 2003 11:18 BST
A recent article in the Harvard Business Review stirred unusual interest within the senior ranks of the computer industry by contending that the broad availability of information technology has dulled IT's effectiveness as a competitive weapon.
Since then the piece, "IT Doesn't Matter", has been endlessly dissected -- as much as for what it suggested as for what it reported. Indeed, if the central thesis of the article proves true, the implications for an IT industry struggling to recover from nearly three fallow years are grave.
Like most tech companies, Microsoft has more than an academic interest in how all this turns out. The company, which has sold billions of dollars of software over the years, would suffer the effects of yet another slowdown in customer buying.
Paul Flessner, senior vice president of Microsoft's server platform division, recently waded into the debate in an interview with ZDNet UK's sister site, CNET News.com. Yes, he allowed, IT providers do indeed have a lot to answer for in terms of unfulfilled promises. But Flessner roundly rejects the notion that businesses should hand over the keys to their core businesses systems because the technology is too complex. He argued that companies with an interest in driving services revenue (read: IBM) are behind the promotion of the idea that IT should be paid for like gas or lighting bills.
Instead of wide-scale outsourcing, Microsoft says companies need products that are easier to implement and administer. In that vein, the company is working on ways to simplify datacentre operations and more tightly integrate products -- two initiatives whose success or failure may well help decide how much IT ultimately matters in coming years.
Q: It seems like Microsoft is essentially defending the position of IT in businesses. Are you?
A: You bet. I was an IT professional for a number of years. The (Harvard Business Review) article just isn't clean enough. (It) actually makes some good points; there are certain parts of any value chain that are less critical to a business. If you're a distribution company, you want to outsource or out-service your payroll system. Microsoft outsources our payroll system. There are systems that are less mission-critical to your business than others, and if they are truly viewed as commodity, then sure, manage them cost-effectively.
Any problem with that view?
I have no problem with that. I encourage it. I think it's exactly the right thing to do. But to say that because everyone has the same technology, it's a commodity? The golf club example is real: I don't play golf like Tiger Woods. Not everyone has the same systems that Wal-Mart does. It's just silly to think that there's no competitive advantage to be made in IT. It's insanity in my mind.
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