Phil Wainewright on the IT industry
Phil Wainewright:
- Tale of Two ITs:
The problem here is that there are two separate information technologies today, just as in the early years of the last century there were two forms of transportation. In making that assertion, I am of course alluding to another HBR article, Marketing Myopia, by Theodore Levitt, which first appeared in July 1960. Levitt’s article made the seminal observation that the railroad companies declined “because they assumed themselves to be in the railroad business rather than in the transportation business.”
Today, the IT industry is led, and has its agenda set, by companies who believe themselves to be in the enterprise-scale software business. What they don’t yet realize (or perhaps are helpless to do anything about — see Disruptive Technologies: Catching the Wave, by Bower and Christensen, HBR January 1995) is that actually they’re in the distributed process automation business. If they and their customers don’t adjust rapidly to their new market environment, their destiny will be to end up as a minor footnote in a future article in HBR about the astonishing decline of the one-time giants of our present-day IT industry.
-
The end of software:
Consolidation means contraction. When five leading firms propose mergers in the same week, the prognosis for the enterprise software industry looks dire. Especially when in the same week, the most vocal exponent of their nemesis took a bold new step into their universe.
