A few days ago, Infosys along with CSTEP presented a report on how technology could be used to enable the transformation of power distribution. This report was read out in the presence of Jairam Ramesh, minister of state for commerce and power, and Montek Singh Ahluwalia, deputy chairman of the planning commission.

Addressing the issues involved, Nandan Nilekani, co-chairman of the board of directors, Infosys, made a very pertinent point on technology.

He said technology itself is not a magic bullet. It cannot bring about changes in the work culture, act as a substitute for providing incentives to employees to embrace change, or create political will.

It also cannot change governance and project management or address environmental challenges.

But there is one sliver lining technology can act as a powerful tool to ensure that all the above are achieved.

In other words, technology provides the impetus, but only if a lot of non-tech-elements are already in place, Nilekani explained.

Blunt & bold

Such a startling bluntness is not something that one associates with the IT industry. It was shrewd of Nilekani to raise this issue, but the question is, should other IT leaders too start focusing on such matters?

The question becomes more relevant as IT grows and evolves. Long ago, when people didn't understand what technology was capable of achieving/delivering, it was perhaps necessary to add an element of hype to IT. It was an era when people didn't imagine how a word processor would make them more productive at work.

But times have changed. The benefits of technology are documented, and the productivity gains are clear to everybody.

In this context, would it not be better to temper appreciation of technology with an understanding of what cannot be done by IT?

Solow paradox

This is not exactly a new idea. In fact, it is over two decades old and dates back to the statement made by Robert Solow in 1987. He had said, 'You can see the computer age everywhere but in the productivity statistics'.

Solow's remark was based on the fact that, from the early 1970s till the late 1980s, the growth in PC usage was not reflected in economic growth.

A study by Erik Brynjolfsson of MIT and Lorin M Hitt of the University of Pennsylvania, which looked at the impact of computerisation in 527 large US-based firms over 1987-1994, a time when computer usage in the US was beginning to mature, found that computerisation did indeed make a contribution to productivity. As always, reality lies somewhere between Brynjolfsson's build-up and Solow' s put-down.