10.27.06

Nice article from BusinessWeek featuring Nicholas Carr and Microsoft’s Robert McDowell debating “Just How Important is IT Anyway”.

If you dont’ remember, Nicholas Carr was the author of the provocative “Does IT Matter” article (subsequently turned into a book), which basically said that information technology was becoming commoditized and was not a source of competitive advantage.  There were many immediate reactions, and the debate has continued online (and in print) ever since.

What I find interesting about the BusinessWeek article is that each contributer is more “nuanced”, with Carr stating that not all of IT — but most of it — is a commodity.  Likewise, McDowell is willing to admit that some pieces of the technology stack are no longer sources of competitive advantage, but many are.

This feels alot like asserting that because Wal-Mart uses trucks powered by gasoline, and the same highway system as everyone else, they can gain no competitive advantage from how they “move stuff” — which, of course, they do.  There is also the opposite tendency to “buy the running shoes but not go running”….,  which is the all to common phenomenon to invest heavily in tools, but not in the effort of using them to achieve the goal.

So what has all this got to do with B2B?  Well, much — if not most — of the standards and technology used in B2B  has been commoditized, and not recently.  EDI’s age is in the decades, as are most of the communications technologies used to carry it.  And yet, with apologies to Mr. Carr — it does actually seem to matter.  As in so many arenas, the skill and creativity with which people use the technology seems to create sustainable competitive advantage — but not in the way you think…

Investing most of your B2B efforts in the construction of elaborate SOA architectures and communications frameworks can often seem like the right way to go, to build a foundation on top of which you will build a world-class B2B program that will deliver many benefits for your business — but this is exactly the kind of program Professor Carr was trying to warn you about.  How can you implement a standard “better”?  You can’t.  What you can do is assemble the tools and put them together based on your understanding of your customers’ needs, trading partners’ capabilities and unique features of your industry.

But how can you do that without the foundation?  Rent (on-demand services) or lease (software licensing) it, just as most retailers or businesses do.  Too many companies that should be defining collaborative processes with trading partners spend their time implementing “plumbing”.  Incredibly, in our own experience, we frequently run into companies that have invested as much as seven figures in B2B infrastructure and software, but have connected only to a handful of partners!  The entire resources of the project have been expended on “plumbing”, and there is no money left over for a sink or shower. 

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