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What is striking, however, is how large the investments in
organization capital - "computer-enabled assets" to Mr. Brynjolfsson
- are compared with technology investments. For example, one popular
kind of technology-related investment in recent years at major
companies has been installing an enterprise resource planning system
to streamline and automate operations. Mr. Brynjolfsson estimates
that in a $20 million enterprise resource planning project, the new
computer hardware required costs $1 million and the software $3
million. The remaining $16 million is in organization capital -
redesigning work practices, retraining workers and other such
investments.
John Seely Brown, former director of the Xerox Palo Alto Research
Center, says he believes that recent changes in software technology
could allow big gains in productivity and innovation. The
opportunity, he says, is to move beyond the limitations of
centralized systems for automating business operations, like
enterprise resource systems. "Those systems are prisons," said Mr.
Brown, who is scheduled to speak at today's conference.
The software plumbing of computing, Mr. Brown explains, is
evolving, and so is Internet-based software for individual workers.
Software systems built on Web standards, he said, can be used as
pick-and-place building blocks, instead of the more formal
hierarchical systems of the past.
Mr. Brown also points to the rapid development of what he calls
"social software" like instant messaging, Weblogs, wikis (multi-user
Weblogs) and peer-to-peer tools - all of which make it easier for
workers to communicate and collaborate online, almost
instantaneously.
The combined result, Mr. Brown said, is information technology
that can amplify social interaction and enhance workers'
understanding of what is happening around them. The benefit, he
added, could be to increase their ability to "collectively improvise
and innovate."
That is a key to productivity and peak performance, according to
Mr. Brown. Business, he said, is a lot like soccer. In soccer, there
are some set plays, but the best teams also display a wealth of
effective improvisation based on the players' deep knowledge of one
another. "It's the same in the best corporations or start-ups," he
said.
Mr. Brown insists that the relentless pressure of global
competition and the migration of skilled jobs abroad adds urgency to
the pursuit of technology-enhanced productivity gains. "We can get a
lot more out of people here if we really tap into them as new
sources of innovation and productivity," he said. "And we're getting
the right kinds of technology tools to move this along.
"It's the only way we can compete."
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