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Technology Paradise Lost
The dust cover blurb summarizes Keller's position: "...American corporations let IT grow until it reached one half of all corporate capital spending by the year 2000. Now, chastened by their spending failures, IT managers are converging on a new consensus: to exploit IT competitively they must use their smarts over big money. ... Counterintuitively, companies that spend less in order to get more from information technology will likely be the big winners." That's quite a claim, and a thorough reading of the book finds that Keller only supports half of that thesis.
The thought is reiterated early in the book: "...companies can move ahead over the next few years without large increases in their IT budgets. The only thing a company needs is a different perspective." (page xii). That prescription sounds suspiciously similar to the oversimplistic advice found in positive thinking self-help books. Keller does not yet make explicit what the different perspective will do for business. Perhaps it should be taken at face value, in that it will allow companies to move ahead without increasing their IT budgets. But is continued progress without budget increases such a massive gain? More significantly, how does that address the larger issues of failed IT projects, to which he alludes earlier? In my opinion, that issue is of much greater consequence.
Keller correctly points to some of the reasons why the heady e-commerce binges are not about to return: increasing scrutiny of IT budgets, greater demand for return on investment (ROI), cheaper and simpler solutions, offshoring of software development, lower wages to American programmers, abandonment of failing projects, Internet-based architecture, and adoption of open source software (OSS), such as Linux. Addressing these changes at a more strategic level, Keller notes that, "After years of questionable returns, cost overruns, and increased complexity, companies are pushing financial rigor to IT groups." (page 6).
The book's first seven chapters discuss the primary factors in leading to reduced IT expenditures, at least within the U.S. business community. But the last four chapters go over previous ground, with more variations on the theme of reduced IT spending, interspersed with several examples from various corporations. The reader may get the sense that not much new information or recommendations are being offered, but instead that these four chapters are serving as filler, to beef up the size of the book. Otherwise, it would be more obvious that the book's usable contents could be boiled down into one meaty article.
Keller's primary thesis, that American IT could in the future produce more returns for less investment, has two primary components. The near-term and likely long-term trend for declining corporate spending on IT, is well established in his book. In fact, one could argue that reduced IT spending is not something that American companies will adopt by choice, but instead will be forced upon them due to deflationary pressures, increased costs for natural resources, and declining ability to pass along cost increases to U.S. consumers falling further behind financially. But the flip side of his thesis, that companies will get even more results despite spending less money, is not nearly as well substantiated. Not a single one of the chapters in the book is devoted to demonstrating that this is happening, or will happen. Companies may be able to maintain current levels of service despite reduced funding; but greater results per dollar invested (i.e., efficiency) does not imply greater results on an absolute basis. As such, Keller's big claim noted earlier, is only half fulfilled.
The critical questions -- concerning the proper role and funding of IT -- are presented in the book couched in the language used by high-level business managers, who speak in vague terms about "technology" and "infrastructure," and yet have little or no real understanding of how it truly works, having spent their earlier years pursuing MBAs rather than programming computers. It could be argued that such general terminology must necessarily be used when discussing information technology among business managers. That may be true, but it does not lessen the dangers of fuzzy thinking and overly broad conclusions found in Keller's book and in the typical articles discussing IT purpose, strategy, and utilization. In particular, such excessively broad strokes, in my experience, not only mask the ignorance of the IT manager demanding miracles from their staff, but invariably increases the odds that upper management will be seduced by the handwaving consulting firms -- and thus fall prey to the mistakes delineated by Keller.
Of all the inapt analogies in the book, its title is perhaps the most egregious. Alluding to John Milton's famous narrative poem, "technology paradise lost" implies that there was a time when IT resource usage was idyllic, if not perfect. Yet by Keller's own account, the misspending and failed projects, followed by financial discipline imposed by the outside world, are anything but heaven-sent. One cannot lose what has never been found.
Weighing in at 243 pages, Technology Paradise Lost is a quicker read than many other business books. Part of that is due to the unfortunate repetition of a few core ideas. Fortunately, the book has just enough tables, charts, and breakouts, to add some visual variety to the text.
The book benefits from the author's clear writing style, no doubt honed from over two decades of creating articles, documents, and presentations intended for business managers. Keller does a solid job of utilizing real world statistics and examples to back up his assessments.
Despite the repetition, sloppy analogies, and business-speak generality, Technology Paradise Lost offers a valid discussion of changes currently being experienced by the American IT industry as it grudgingly recovers from the Internet boom and bust. The book may be of value to IT managers who, for whatever reason, are ignorant of the obvious transformations that are taking place. Yet, any IT industry participant who devotes even a modicum of time to monitoring the latest developments and trends, should be well aware of IT budget trimming, offshoring, open source software, and other cost-saving methods. Otherwise, to be so out of touch with reality would be inexcusable. On the other hand, that was one of the primary symptoms before and during the widespread dot-com insanity, and could easily account for any beliefs in its imminent return.
Michael J. Ross is a freelance writer, computer consultant, and the editor of PristinePlanet.com's free newsletter." You can purchase Technology Paradise Lost from bn.com. Slashdot welcomes readers' book reviews -- to see your own review here, read the book review guidelines, then visit the submission page.
Technology Paradise FOUND
I remember those days - sure it was a time of great promise and flowing capital but the products royally sucked - most didn't live up to the hype and the futurama aura and many a flawed device pissed off customers with the poor service after the sale. Lately, I've been buying a lot of stuff and have had a great success rate, I've been real happy with stuff recently.
try { do() || do_not(); } catch (JediException err) { yoda(err); }
...we'll see the return of really good Superbowl commercials!
Paleotechnologist and connoisseur of pretty shiny things.
when they used to do the predictions with an envelope in their hand turban on their heads... Oh, wait..
Faith: n. -- That human impulse that drives them to steal appliances when the power goes out
True Technologic Paradise FOUND?
Maybe now that all the fantastic and unrealistic business views of IT are gone, we can concentrate on science and actually learning something?
If it's not in verse it sucks.
"...Counterintuitively, companies that spend less in order to get more from information technology will likely be the big winners."
I predict MS won't exist in 5 years!
Book Reviews: Automobile Paradise Lost
Posted by timothy on 01:12 PM -- Thursday May 19 1935
from the see-ya-suckers dept.
Michael J. Ross writes "For veterans of the automobile (CAR) industry, the late 1920s was a remarkable time. The "stock-market bubble" expanded, the model-Ts rolled off the assembly line, and the automaker stocks soared. But now that the bubble has deflated and the automobile party has wound down, U.S. vehicle assembly lines are struggling with reduced budgets. Yet apparently many believe that the sector will regain its past glory and blistering growth rates. According to experienced automobile consultant Erik Keller, it's not going to happen. He presents his case in Automobile Paradise Lost, published by Manning Publications, whose user group representative kindly provided me with a copy of the book for review." Read on for the rest of Ross's review.
"Yet apparently many believe that the sector will regain its past glory and blistering growth rates." I must say that I can't recall anyone ever intimating that such a thing would happen.
Probably the most obvious way this is reflected in code production is the attention paid to lines of code as a metric of productivity without constraints on how poorly factored the code is.
Good factoring is simply another way of saying "good theorizing". Ockham's Razor works for a lot of reasons and is the basis for the best measure of code quality: algorithmic information which is computer science's Ockham's Razor.
As warned of by Tacitus:
The same goes for scientific theory, business rules and software quality.
Too many cheap programmers spells death -- not life -- for IT.
Seastead this.
Huh? It strikes me as, if anything, utterly obvious.
What I'm listening to now on Pandora...
One problem with the boom days is that people were building out infrastructure without a lot of information as to (1) how much infrastructure was enough, and (2) without a real business driver.
This is probably due to the lack of experience in most corporations at the time. If you listened to vendors, you needed multiple redundant 64-way Sun boxes to keep your website up and running. Oh, and you'll need a couple of T-1s to feed all that, firewalls, multiple DMZs, and the management software for it.
These days people know that's BS. Why do we need GigE to the desktop? We don't. That's stupid. Why do we need more horsepower? We don't. It's not cost effective. Does this piece of software or hardware actually help our business make money? No? Don't buy it then.
Really, IT supports business. It's an enabling technology, but back in the day nobody really knew enough to figure out what parts really were worth it and what parts weren't. The vendors, obviously, oversold everything. The press were just as ignorant as the customers.
Even today, finding scalability/load/capacity information for most equipment is difficult to impossible. Luckily, now there's a body of knowledge (lore) that you can draw on. Before, there was nothing except vendor propaganda.
Perhaps, in your experience, you haven't seen the whole picture. Lots of things IT departments do that seem wasteful actually make sound economic sense.
For instance, it's often better to trash/donate/garage-sale computers once they start to get old than to try to coax them into working for you, since you'll spend more in personnel costs to keep them limping along. It's often better to order new hardware for new services, even if the old hardware could handle them, since that means one service outage won't affect the other. It's often better to spend thousands on off-the-shelf software that mostly meets your needs than months of man-hours developing it in house.
He's really forgetting the obvious:
10 years ago we were just starting to grapple with the new technologies that the Internet brought about. Applications over TCP/IP, the Web, all sorts of routers, switches and new appliances: all of that necessitated a long and steep learning curve.
Today we have 10 years of experience in all of this "stuff", which makes us enormously more knowledgeable and productive. From all perspectives, hardware vendors are now able to service customers with much more targeted, effective and cheaper offerings (notice the move from software to hardware appliances and custom chips), and IT staffs now know how to use all of these toys properly, what works and what doesn't.
It's all mostly a matter of experience. That's why IT budgets will remain flat for a while longer.
The critical questions -- concerning the proper role and funding of IT -- are presented in the book couched in the language used by high-level business managers, who speak in vague terms about "technology" and "infrastructure," and yet have little or no real understanding of how it truly works, having spent their earlier years pursuing MBAs rather than programming computers
The people you describe above are the people who control the purse strings. They couldn't care less about the underlying bits and pieces. How much is it going to cost and what's the benefit to the business?
Having "great IT" isn't worth a warm bucket of spit as a key differentiator these days.
"I'd rather be a lightning rod than a seismometer." -Ken Kesey
(IGHEATA) ((I'm Glad He Explained All Those Abbreviations))
"When they invent bitch slaps that can go through a monitor you better f'ing duck" --deft (253558)
Sorry, but can someone help me?
... will likely be the big winners."
I'm only a web developer, so I'm not the sharpest tool in the box.
I never realised that;
"companies that spend less in order to get more
This has to be some business related thing that us in the web industry never realised. Can someone enlighten me? Perhaps their are a few BS grades reading this post?
in the long run, we're all dead anyway.
Hardware is getting cheaper and will continue to do so. I built a computer for $1500 in 2000. Today, it's probably worth $100 (maybe not that much) today. A 1 GB Ram module for it retails for around $120. Even if I bought and installed the Ram module, I *still* probably couldn't sell the computer for more than $100.
I see people advertising 'Almost New' HP and Dell laptops on ebay. They sell for a fraction of the original price. Service and support are what costs *real* money these days. Three year service contracts start out at $350. When you have to buy a $350 service contract on a $600 PC, you know where the *true* costs are for the manufacturer.
That 1 GB memory module probably only cost about 20 bucks or so to make. That's why it'd be foolosh to buy it new and pay $120 for it.
American corporations let IT grow until it reached one half of all corporate capital spending by the year 2000
Remember, that small thing called Y2K? Yeah, companies spent a lot of money, but much of it was directed at fixing Y2K issues and ensuring that all systems were compliant. At least in my company. Maybe smaller companies were fiscally irresponsible, but I think most large corporations have so much bureaucracy that increasing spending for any reason is difficult.
In my IT department, we heard many people leaving and joining startups, buying aeron chairs and having foosball tables in their offices, but those of us who stuck around didn't see any increases in spending.
-- If god wanted me to have a sig, he'd have given me a sense of humor.
I've looked at this from both sides, but I'll borrow from a recent economics column http://www.techcentralstation.com/051905B.html:
We need people who can address technical and business audiences with equal skill. I'm not saying it's easy -- I'm leaving my current company because I just didn't have it -- but it's going to be more critical because the biggest benefits will come from taking a new technical innovation and using it to solve a business problem.
No one seems to care that the traitorous, neoliberal politicians sold our geek jobs out to H1Bs and to outsourced 3rd world labor. I say indict, try, and convict for treason (in a court of law) all the politicians who sold us out, along with the CEOs who did the same, and then sentence them to death and execute them in the electric chair, as all traitors should be executed, by rule of law, and then we can get America back on track.
eat shiat and bark at the moon
By selling out so easily to business, technology has been held back in many ways. It was a matter of offering the brains and the creative geeks some money, so they would use their knowledge for evil, rather than good. I think I prefer the 80s, where at least there was still some idealism.
What did the 90s boom give us? Fucking internet advertising and banner ads. Overpaid HTML jockeys with no skill. Trolls, script-kiddies and fools. Pyramid schemes. "Bloggers." And we can never go back to those blissful ad-free, blog-free days.
... and then they built the supercollider.
I'm not sure why he says that the glorious e-commerce days wont return. Hey - there where no glorious days. Surely, a lot of sites spawned all over the net, hoping to grasp some of those millions just waiting to be earned, but there weren't much actual buying taking place on the net. The e-commerce market is much bigger today than it was then. The ammount of credit card transactions on the net peaked christmas 2004.
No, I think he was actually recommending that you ingest lead.
If your house is old enough, you can ingest your lead in convenient chip form.
^_^
____
~ |rip/\/\aster /\/\onkey
people do
That is why until organizations learn to ignore their big huge engineering-based waterfall processes and start focusing on developing their people both individually and as teams, they will not see any significant improvements in their ability to use IT more effectively. Agile methods are really great because they turn the focus away from the process (use the minimum process that can possibly work), to the people (teamwork, communication, collaboration, mentoring, etc.). That isn't to say that agile methods are easy... far from it. In many cases it takes a huge cultural shift for an organization to adopt agile methods. However, the effort is worth it because suddenly projects that used to take 18 calendar months are being finished in 4 or 6 calendar months... simply by eliminating the worst wastes in the corporate system, amplifying the team's learning, and allowing them to make decisions about how they do their work.
Check out:The Agile Software Manifesto
The Scrum Methodology
And my blog, Agile Advice (couldn't help but put in a little self promotion
Helping with organizational effectiveness is our job.
Uhhh, sorry, but IT is now the very definition of commodity. Hardware, labor, and software are now so cheap and interchangeable that there's no other way to describe it. Rather than spend money on expensive RISC chips like pa-risc or Ultrasparc, you can now get cheap x86/64 chips with comparable or better performance for a fraction of the price, and from a wide variety of vendors. With the information revolution and the Internet, now you can get programmers from across the ocean for a 10th of what you'd pay an expierienced US coder. And software? Windows boxes are relatively inexpensive compared to what businesses used to pay for unix workstations, and now you've got cheap/no cost software on top of that.
Face it...IT has become the Wal Mart of business buying. It's cheap, it's everywhere, and for IT vendors to make money, they have to rely on huge volume because margins are so slim. Only companies like IBM are making real money from services, and some people think even that won't last forever. I read a stat that claimed IBM was losing $33 on every PC they made, which is why they sold that business.
Spending less while getting more isn't a new concept, as the author might think. Other business sectors have lived by the mantra for years. IT has just been forced to play that game too after the disastrous dot bomb. Welcome to the real world, IT, the world where life is hard and business is cutthroat. The dot com boom was a fantasyland that was doomed to failure, and it's never coming back.
Knowing this, isn't it getting a bit tiring to hear these execs say that not enough students are going into IT/CS? Surprise surprise...the grads we have now have to scrape for jobs compared to other highly skilled professions, and the current marketplace is hot for international outsourcing. Why are these people surprised that US students are going "no thanks"?
Life is hard, and the world is cruel
The tech bubble(s) of the 90s wasn't caused by IT departments. It was caused by venture capitalist, who had major investments in tech companies, bullshitting every other company CxO in the world into thinking they too had to have an "Internet Strategy" or that they had to buy into the latest and greatest thingamabob or they would go the way of the dinosaurs. Then after they got other suckers to buy into their IPO's they bailed and brought the tech industry back to earth. Now they are telling CxOs they must have an "Offshoring Strategy" or their company will go the way of the dinosaurs. Wanna guess where the VCs have their money invested these days...
Remember how crappy it used to be? Catalog pages didn't match the shopping cart, credit card processing involved ICVerify emulating a 1200 baud card swipe terminal, and half the time you had to call up to find out where your order went. On the merchant side, banks didn't have good online integration, half the transactions were bogus, and there was no way to get UPS and FedEx directly connected to your own systems. There were days when the Internet backbones would choke, and you'd go online to read the Internet weather report and see that MAE-WEST was dropping more than half its packets. And you needed an army of semi-competent people to glue it all together.
The on-line businesses that are still around have all this stuff working smoothly now. (Many of the ones that couldn't make it work are listed here.)
For most businesses, once you have all the basics working, you've achieved most of the benefits IT can provide. There's endless stuff you can waste money on. There's "data mining" and "profiling" and "customer relationship management" and "personalization", but it turns out that what works is telling existing customers of products related to stuff they already bought. Which isn't hard. Microsoft is pushing "synchronization", or "change the spreadsheet and your PowerPoint presentation changes to match", but most those bells and whistles don't really help productivity.
If you're a user of IT, this is great. If you're an "IT guru", this can be bad news.
Once I built a railroad, made it run,
made it race against time.
Once I built a railroad, now it's done.
Brother, can you spare a dime?
Unionize.
The power of the IT community rivals the trucking industry. If we had a union, we would have a stronger voice in the government.
The Kruger Dunning explains most post on
I note that the reviewer doesn't like the title either. There are several things that all get tied up in "the bubble" that were really separate otherwise.
I think many people, even those of us who lived through it, discount the impact of Y2K on the marketplace. IT spending increased quickly in the late 90s as companies realized they had to address Y2K issues or (potentially) perish. As a result, much work was done that had previously been put off, sometimes for decades. There were massive migrations, massive upgrades, and massive change -- much of it long overdue. This created a bubble in hiring and purchasing, and that bubble largely burst about 15 seconds after midnight local time when Y2K happened and little else.
The internet bubble started earlier, and burst a little later. While Y2K was a 2-3 year bubble on a fast track, the internet bubble was a 5 year bubble that started slow but kept accellerating.
It's also hard to discount the impact of politics in the US on the economy. There are those who say that the bursting of the internet bubble has as much to do with tech stocks being overvalued as it did with George W. Bush practicing economic fear-mongering on the campaign trail -- in essence, talking the economy down. One thing appears clear: when Clinton took office, he had promised tax cuts, but upon meeting with Alan Greenspan, Clinton blinked; when W. took office, and met with Greenspan, Greenspan blinked.
Setting aside the market collapse, both bubbles did a lot to set the stage for long-term success. Y2K forced companies to make investments that will (mostly) stand them in good stead, and forced them to modernize their systems. The internet bubble pushed things past critical mass and got (almost) everyone on the bandwagon. Between 1995 and 2001, American industry probably advanced (or caught up) 20-30 years.
The market collapse may have been a long-term good thing as well, at least in the sense that everything got modernized, bunches of new tech got proven, then we collectively slammed on the brakes and spent the next 3-4 years retrenching. In that time, Apple and IBM have become market leaders in new areas, and a recession is a wonderful thing if you want to force people to consider free software.
I'm not saying all the pain was good. Many people did, indeed, lose paradise. But to me, it looks less and less like a train wreck in hindsight.
http://drteknikal.blogspot.com/
...and it ain't coming back. What we are seeing is a regression to the mean.
In the Internet days, major enterprises with traditional business models watched in horror as Amazon appeared to make the whole world obsolete. Priceline, nothing more than a travel agent, at one time had a higher market cap than all the major US airlines combined. This was a historic misallocation of capital, comparable to the overinvestment in radio in the 1920s.
Every CEO in America asked himself whether a pimply geek like Jeff Bezos could blow up out of nowhere and destroy his whole business just like that. We know how stupid that was in hindsight, but fear is an incredibly powerful motivator. The result was a tremendous amount of IT overspending. And for those of us who were right in the middle of it, it was rational at the time!
THat is all just a bunch of neoliberal, free-traitor doublespeak. High quality of life for the most people is what is best in life. A country is a machine, and like all machines, good design pays off. The Social Democracy model is a superior design. Proof, meet pudding....
eat shiat and bark at the moon
When they were the only game in town (basically) we didnt' know any better. but since linux has matured, there is NO excuss for people (IT) to not create the next big thing..
i wasn't part of the 'dot-coN' boom..directly, but i was involved (personally, on my own) in making a software program which was a niche for the automoble industry. i guess because so much $ was going for crap and fraudulant stuff then (around 1997) i could not get any funds to market or improve my code (it needed to taken from dos and put into windoze or linux).
even tho i did EVERYTHING right (had a business plan, put my own money and time into the project, had a product fully-functioning, and had actually paying customers and prospects for my creation) the bastard banks and vc's just laughted at me. i guess they thought having something 'legit' was rediculous.
anywaze, this didn't daunt me in thinking about and creating other projects that would be easier for me to 'sell' on my own, or with less help/money.
and more importantly.. it did not keep me from enjoying the joy & wonder of those 'early' InterNet experiences... you know, when we 'met that special' someone in cyberspace...and..and... had our heart broken by them :(
well, those thoughts and the ones like when I (we), for the first time, downloaded, installed, read the license agreement (not) and got RealPlayer working on my 486 sx 25 mhz with 8 megs!!
or the fulfillment, when i found and installed B32 for windoze 3.1 (you remember, the little patch/prog that aloud us to run 32 bit windoze programs (sorta ;)..
or, remember:'Pc Speaker' program--- u remember, the program for 'tight-wades' like me that refused to put soundcards in their computers.... yearrrsss after they came out! It aloud you to play basically any & all audio through your little pc's speaker!
ahhhhnd the first time we got to dL our first cd of our favorite rock star in less than an hour!
well, just like 'those good ol daze', i believe (and try and work at) creating one of those exciting ideas. many of the old ideas need to be 're-dun' as '*The People Of World* wait... for someone(s) to do what the US government (shoulda, coulda, woulda), in putting down that great 'Technological Imeding Monster'---- m$. :)
I will gladly loose all of life's battles.. in order to win the war..
"The more numerous the laws, the more corrupt the government."
What's interesting to me about this tidbit is that it the numerous laws are both a cause and effect of corruption. Whenever a straightforward, simple law is passed, someone will find a way to scam around it. If they are devious enough, they can't be charged under current law, so a new law has to be written to cover it. This is what happens with campaign finance reform every few years.
Conversely, people always want to get loopholes, exceptions, special funding or other benefits from the government. A lot of these actually end up as laws, especially if you contribute liberally to party leaders...
We are the 198 proof..
Not really. Unions only work for jobs that can't otherwise be outsourced. Construction on buildings has to be done here, the police have to patrol our streets, teachers have to work in our schools, boats need to be unloaded at our docks. But there's no reason that our software has to be written locally or that our server farms have to be located in this country. Unionization would kill the IT industry.