Devil's Advocate: Sobering times for IT

In the dying years of the twentieth century, booming economies allowed us to look at everything with rose-tinted spectacles. Everyone knew that IT was an important part of the growth dynamic. Now, we are all in sober mood and serious questions are being asked. For one, does IT really make the economy better?

From the US comes job creation data. It turns out that high-tech has not been contributing much at all. Between 1989 and 2000, average growth in US employment was 1.8 per cent each year. Yet in Massachusetts, the state ranked highest for concentrations of technology, the job creation rate was a mere 0.6 per cent, matching pedestrian France. The top three US occupations for young people in 2000 were, in descending order: cashiers, waiters or waitresses and cooks.

Well, maybe if technology doesn't create jobs, at least it makes those of us in jobs more efficient. Or does it? KPMG's answer is that the claim is at best unproven. The professional services firm, which numbers many top companies among its clients, believes that UK companies may be wasting £17bn each year through bungled IT. That is over one per cent of the whole economy, and it excludes the disastrous public sector projects that we hear about so often.

Even more worrying, nobody seems to know what is going on. The KPMG survey revealed that many senior board members in large companies had no idea how much is being spent on IT. And the vast majority could not identify cost savings derived from IT. If nobody knows what IT is doing for companies, then we have to doubt whether anyone knows what it is doing for the economy.

One consideration is that many people like technology. I do. The Nokia Communicator that I left at a motorway service area contained all my personal and business contacts, as well as all my appointments. Fortunately, it was found, and I reclaimed it on the journey home. It is a wonderful gadget that makes me feel very efficient and dynamic. To be truthful, I have never really considered whether I could be just as efficient by spending a few pounds on a diary, an address book and a pocket notebook. Why should I feel guilty, though? After all, it seems that Britain's top companies run their IT with a similar lack of critical evaluation.

Yet I don't want to join the out and out pessimists. They have been repeatedly proved wrong. When computers were first made, it was thought that six would be sufficient for the whole world. When I was a junior programmer, I was assured that software development would soon be completely automated, putting us all out of jobs. In fact, computers have inspired an extraordinary degree of human ingenuity, creating possibilities that have surprised us all.

The trouble is, we have become blasé about our creativity, and lost our capacity for self-criticism. It takes something like the KPMG survey to give us insights into the corporate sector, but public sector projects are regularly subjected to the public gaze. What we see is that failures occur for the most mundane reasons. The assumption that doing things in a novel and untried way will save huge sums of money turns out untrue. Jumping to a new system without proving that its processes will work brings the operation to a standstill.

Yes, there are brilliant successes and IT at its best is remarkably creative. Let's take care, though, to understand both what leads to success and what leads to failure. Can we do more to evaluate new schemes, and benefit from the lessons of our profligate past?

** Martin Brampton is a director and founder of Black Sheep Research (http://www.black-sheep-research.co.uk ), an independent consultancy providing research, writing and speaking services on a wide range of business and technology subjects. Martin was previously a director at Bloor Research, and has worked with IT as a user and analyst for over 20 years. He is a frequent contributor to silicon.com's weekly Behind the Headlines TV programme and can be contacted at silicon@black-sheep-research.co.uk.