The question of whether computers do or do not demonstrably improve productivity has stirred up a debate that has been on the agenda of academics, the press, and consultants since the early 1970s. Finally, the winner of the 1987 Nobel prize in economics, Robert Solow, a professor at MIT, obliged by giving these debates popular recognition by tagging the lack of such evidence the "productivity paradox."
According to professor Solow, "You can see computers everywhere but in the productivity statistics."
The productivity paradox has not been resolved even to this day. Our highest economic authority, the Board of Governors of the Federal Reserve, chaired by Alan Greenspan, could not obtain a consensus on this issue from the 10 most distinguished specialists in this field after listening to their evidence for over four hours on April 15.
The debates about the productivity paradox range from strongly held biases and self-serving claims, to misused statistics, to facts. My own work, which is based entirely on verified, validated, and audited corporate data, has been involved in such discussions. Therefore, the credibility of my work depends entirely on the reliability and trustworthiness of whatever I have written.
This is where InfoWorld columnist Bob Lewis enters into the picture. With his Dec. 15, 1997, IS Survival Guide column, Lewis initiated a campaign of attacks on my work. (See "Computer backlash picks up speed, but arguments from critics are flawed," www.infoworld.com/printlinks.) The attacks continued in several columns. My purpose here is to counter those attacks.
For openers, in discussing my new book, The Squandered Computer, Lewis wrote, " ... every big lie requires a big liar ... ." Lewis appears to have based this characterization on the belief that I use the ratio of Sales, General and Administrative over Cost of Goods Sold (SG&A/COG) as a measure of IT value in the book. His conclusions, and thus the characterization, were in error on two counts. First, my book does not state anywhere that SG&A/COG is a measure of IT value. Second, my book does not refer to the SG&A/COG ratio as an indicator.
Following publication of my letter to the editor disputing Lewis' false representations, he countered in a subsequent column with a number of statements, including one demonstrably incorrect allegation that " ... Strassmann ... has not talked to people who actually use computers to do their jobs ... ." (The letter and columns can be found at www.infoworld.com/printlinks.)
To press his criticism further, Mr. Lewis embarked on tampering with my published statistics. He singled out one of my many graphics, which showed the lack of correlation between IT spending in the food industry and corporate profitability. He tossed out 19 percent of my data points to assert that the remaining data showed a positive correlation between IT spending and profitability. That is factually not true. By keeping two high-profit firms in and then tossing out two of the highest underperforming spenders, he made his numbers come out the way he wished. This is not statistics. This is misrepresentation.
For the record, I should note that I have never met Bob Lewis and have not engaged in a competitive situation with his firm. As an InfoWorld columnist, he is entitled to his opinions, but not to deliberate misrepresentation of facts or to gross misuses of statistics, both of which I believe he has done.
Although Lewis' columns were published in InfoWorld more than a year ago and I responded to the first one, I wasn't aware of the two additional columns until March of this year. In reviewing my forthcoming book, Information Productivity, InfoWorld Editor in Chief Sandy Reed mentioned those columns. (See "InfoWorld is at the center of the intersection where IT and business collide," www.infoworld.com/printlinks.) She suggested that I write this guest column to set the record right, for which I am most grateful.
Paul A. Strassmann was a CIO from 1961 through 1993. He is the author of Information Payoff, The Business Value of Computers, The Politics of Information Management, The Squandered Computer, and the forthcoming Information Productivity. He is also a columnist for Computerworld, a sister publication of InfoWorld. He can be reached at email@example.com.
Calling all peers
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