IT is boring

Dr. Terry Cutler

Originally published: Business Review WeeklyMarch 2002

Earlier this month the World IT Service Alliance's biennial Congress was held in Adelaide, and this was a good excuse for quite a few other international meetings.

I came away with four great take-away lines and much food for thought - and none of these were attributable to keynote speaker Bill Clinton! My favourite four lines were:

  1. Australians mistake improvisation for innovation
  2. "cross-overs" is a more meaningful term than convergence
  3. Information Technology is dangerous
  4. Information Technology is boring

Stated baldly, each of these propositions is contentious. Each, however, is worth some serious thought.

Australians mistake improvisation for innovation. Australians have a long tradition of practising the maxim that "necessity is the mother of invention". Celebrated achievements from the stump jump plough to the improvisations by outback mechanics bear witness to our national ability to find solutions to problems "on the run". Improvisation is the art of making something work against the odds. Improvisation is a useful quality, but it is poles apart from the art of innovation, the act of changing the rules of the game. To confuse improvisation with innovation is dangerous.

The second proposition reminds us that some words and ideas have a short shelf life. The idea of convergence is a good case in point. Originally the term referred to the breakdown of the business boundaries between computing, communications, and content. Then we began to talk about the second and third waves of convergence, whereby the information economy was blurring all traditional notions of industrial segmentation. Convergence quickly shifted from a meaning of new interdependencies between previous independent activities to a meaning that implies that everything sinks into a relativist black hole in which everything affects everything else. This conceptual black hole may be a philosopher's delight, but it offers little guidance to a pragmatic business analyst.

South Australia's International Advisory Panel, at its meeting last week in which I took part, decided that the notion of "cross-over" was preferable to convergence. Traditionally we have mined intellectual capital in the narrow vertical silos of specialised areas of expertise and industrial organisation. The Panel concluded that the real opportunities for the future are located in the unexplored spaces between traditional industry and disciplinary silos of activity. Look for gold in the gaps. Good examples are the cross over between telecommunications and media content in digital television, between information technology and biotechnology in bioinformatics, or between the arts and science. The phrase "cross-overs" takes us into the world of micro-economic analysis and the dynamics of firm level behaviour and competition. The term convergence irresistibly raises us into the esoteric domain of macro economic theory. Macro-economic theories are good for explaining past trends, but are unhelpful in informing short-term enterprise decisions or in predicting innovative developments.

David Murray from the Commonwealth Bank introduced the controversial proposition at the Adelaide WITSA Congress that IT is dangerous, and is the root cause of the current economic downturn. His main argument was that the return on investment in information technology has been illusory. The great IT hoax of the Y2K threat provides some justification for Murray's cautionary warning about believing all the sales hype about information technology. Contrarian viewpoints are healthy. In this case, however, Murray's view appear to validate Bill Gate's famous maxim that "we overestimate the short-term, and underestimate the long term" impacts of information technology.

My favourite takeaway was Bob Bishop's pronouncement that IT is boring. Bishop is one of Australia's impressive IT expatriates, and heads up SGI (previously known as Silicon Graphics).

Bob's boredom arises from his telling observation that most consumer IT and business IT have become commodity stuff. People pushing black boxes, shrink-wrapped software, bulk bandwidth, or chunks of airtime. All good stuff, but hardly exciting. A commodity is a commodity.

Bob Bishop's point is that we need to distinguish between the commodity aspects of IT and the non-commodity areas and firms which are the hot bed of innovation. Bob explained that he recently told Wall Street analysts that what we needed was a new market category to highlight the different value drivers associated with commodity IT and innovative IT.

Bob describes non-commodity IT as core computing and mission critical applications. It is the territory of technical and scientific computing technology. It involves what we would normally describe as disruptive or breakthrough technology developments. The demand for core computing comes from an interesting set of leading edge customers that includes the arts and creative industries, space industries, advanced research institutes, and defence. Core computing applications will be deployed in company critical functions in sectors like automotive, aviation, pharmaceuticals, and mineral exploration. What's happening in these spaces is certainly not boring. Over time others will commoditise these products and services. Innovation in IT, as in everything else, is a moving frontier.