A Strategy Revolution for IT?

Photo by Flickr user @apothecary

Photo by Flickr user @apothecary

I was catching up on some reading backlog over the weekend, and noticed a parallel I’d not seen before: The IT industry right now is quite similar to industry in the USA in the 1970s. Similar in several interesting ways.

Firstly, American companies in the ’70s had grown fat and lazy, for a variety of reasons — growth after the destruction of Europe and Asia in WWII, a population boom, etc. — which looks a lot like centralised IT departments with no competitors.

Secondly, the very idea of competition was an afterthought. The thinking at the time was dominated by anti-trust, the behaviour of monopolies, and attempts to limit the enormous power of a few large corporations. Again, similar to the way internal IT behaves with regard to both their internal customers, and the world around them, particularly outsourcing and as-a-service competitors.

Thirdly, the lack of awareness of costs and scale, and how they relate. The Experience Curve popularised by BCG was a big deal at the time, and in reading over the history of its introduction (again), I see many parallels with IT today. Many companies I’ve consulted to have no idea what their costs of providing IT really are in detail, nor do they have people skilled in how to work it out. Certainly not in the way that BCG used to great effect in the 60s and 70s. It’s just a blind spot.

Which makes we wonder: Are we poised for a strategy revolution in IT?

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