Nicholas Carr had an interesting post about how developing homegrown, strategic systems has turned from advantage to disadvantage. He said:
"Nevertheless, after I wrote "IT Doesn't Matter" back in 2003, critics would routinely present Wal-Mart as the killer counter example to my argument that information technology rarely provides a competitive edge anymore. Wal-Mart had famously set itself apart from its retailing rivals, IT analysts would point out, by building a lot of highly customized IT systems that its competitors were hard-pressed to match."
I think Carr is missing the point about what Wal-Mart is doing. The news is not that "the custom systems that once set you apart are now the "legacy systems" that hold you back." Rather, the lesson that should be learned is that smart companies actively manage their application portfolio (and the balance between custom and packaged applications) over time. Wal-Mart is managing its portfolio exactly how an organization should manage it. Over time, leading-edge, competitive-advantage practices become commoditized. If it is a good idea others are going to adopt it and vendors will see that customers want that capability and it will become supported in packaged applications (and even eventually outsourced if it is truly a commodity). The key for Wal-Mart (or anyone else) is to move to packaged applications for those commoditized practices (what Geoffrey Moore would refer to as "Context") while re-focusing on the custom system development capabilities on the next leading-edge, competitive advantage practices (in Moore-speak focusing on "Core"). Striking the right balance is the key.
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