The IT department is dead?

In an article just published on Network World, it claims that business writer Nicholas Carr boldly states that "the IT department is dead, and it is a shift to utility computing that will kill this corporate career path". Such is the thesis of his newly published book The Big Switch: Rewiring the World, from Edison to Google.

This is not a surprise since in 2003, he published a similar sentiment in a HBS article titled "Does IT Matter" which got published in a book of the same title. The article asserted that IT investments didn't provide companies with strategic advantages because when one company adopted a new technology, its competitors did the same, thus eliminating any competitive advantage originally claimed. This in turn is what leads to the commoditization of IT software and hardware. In addition, the skill sets which were originally highly sought after to set up an IT infrastructure become commodities in turn, since the skill's value diminish in parallel with growing ubiquity and ease with which such high tech products are purchased and implemented.

Seems Carr still holds the above view and further predicts that such services will be transferred over to a IT "utility" type company, much like electric utility companies replaced company-run power plants in the early 1900s. As Carr explains:

Factory owners originally operated their own power plants. But as electric utilities became more reliable and offered better economies of scale, companies stopped running their own electric generators and instead outsourced that critical function to electric utilities.

Carr predicts that the same shift will happen with utility computing. He admits that utility computing companies need to make improvements in security, reliability and efficiency. But he argues that the Internet, combined with computer hardware and software that has become commoditized, will enable the utility computing model to replace today’s client/server model...

Carr embraces Google as the leader in utility computing. He says Google runs the largest and most sophisticated data centers on the planet, and is using them to provide services such as Google Apps that compete directly with traditional client/server software from vendors such as Microsoft.

"If companies can rely on central stations like Google's to fulfill all or most of their computing requirements, they'll be able to slash the money they spend on their own hardware and software — and all the dollars saved are ones that would have gone into the coffers of Microsoft and the other tech giants," Carr says.

While I do agree that IT is becoming more of a commodity, I think it is a bit of a jump to assume that this will render all IT type jobs obsolete. I definitely think jobs tied to a specific technology will become obsolete, but anyone working in IT knows that or should know it. I think the real trend, and one which I'm noticing in my day to day work as well as what I observe going on in the industry, is that IT will be though of a just another necessary operational function and be more aligned with business functions and needs, and less as a separate division in which you need highly paid and skilled technicians to run it.

Obviously Carr is resorting to hyperbole to sell his book, but I read his first book and found it thought provoking and I expect the same from this more recently published work, and if it gets me to think more critically and strategically at my job function as an IT project manager, then I think it will be well worth the effort.