I.T. Productivity Will Arrive (And Sooner Than Godot) - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IoT
IoT
News

I.T. Productivity Will Arrive (And Sooner Than Godot)

For years, economists debated whether IT enhances productivity. In the past few years, that argument seemed to have been settled. It does. But current thinking suggests that IT-propelled improvements in productivity remain years off. "Adjusting to new technologies takes time," Federal Reserve vice chairman Robert Ferguson said recently.

IT's impact on productivity depends on how it's used, McKinsey & Co. says in a new study. The management consultancy looked at the semiconductor, retail, and retail-banking sectors and concluded that no one killer app improved productivity. Understanding the enabling role of IT in productivity growth involves understanding the environment and dynamics of each industry, its business processes, and key performance levers, McKinsey says.

chartAmong the barriers to IT-enhanced productivity gains is corporate culture, says James Champy, chairman of Perot Systems' consulting group and an early reengineering advocate. Underlying the connection between IT and productivity, he says, are three principles: transparency, standardization, and harmonization. Transparency lets business partners view each others' processes. Standardizing technology furnishes companies with a smooth flow of information, product, and money. Harmonization links partners' systems, encouraging openness, mutuality, and interoperability.

Companies that follow these practices could see significant improvements in processes that could result in 30% gains in efficiency and lower costs, Champy says. But it could take five to 10 years for those types of improvements.

Even tech-savvy Generation X managers resist changes in ways that block IT-enhanced productivity gains. They can be "as traditional as their fathers and grandfathers about trust, power, and openness," Champy says. This works against an environment that fosters improved productivity, no matter how much technology is deployed, he says.

Still, progress will be made, the Fed's Ferguson says. Today's progress "may not seem as revolutionary as five or six years ago," he says. "We all have a natural tendency to look for the next killer application that will once again revolutionize the high-tech marketplace. This is the high-tech equivalent of waiting for Godot, and we shouldn't ignore the many smaller changes to business practices that are continuing to yield real efficiency gains."

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
The State of Cloud Computing - Fall 2020
The State of Cloud Computing - Fall 2020
Download this report to compare how cloud usage and spending patterns have changed in 2020, and how respondents think they'll evolve over the next two years.
Commentary
Why 2021 May Turn Out to be a Great Year for Tech Startups
John Edwards, Technology Journalist & Author,  2/24/2021
News
How GIS Data Can Help Fix Vaccine Distribution
Jessica Davis, Senior Editor, Enterprise Apps,  2/17/2021
Slideshows
11 Ways DevOps Is Evolving
Lisa Morgan, Freelance Writer,  2/18/2021
Register for InformationWeek Newsletters
Video
Current Issue
2021 Top Enterprise IT Trends
We've identified the key trends that are poised to impact the IT landscape in 2021. Find out why they're important and how they will affect you.
White Papers
Slideshows
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Sponsored Video
Flash Poll