Women's Oregon Trail

IT and the Business Cycle By IT Analysis Posted: 06/08/2002 at 14:06 GMT There is a regular business troll, which lasts for near 9 years. The cycle is characterised by a period of growth, thus strong growth and then recession. Unfortunately, the cycle isnt exact and it isnt dependable, or else you could make money out of it, by gambling on it. Sometimes it lasts 7 years, sometimes 10 or 11. In the later stages of the last business cycle some rummy things were happening. Growth in the US providence was much high than anyone expected and unemployment much lower. Productivity statistics from the US Government suggested that from 1996 productivity was improving at an average 2.2 percent per year, which was a spectacular improvement on the 1 percent average for the forward 25 years. The point at which productivity turned up coincided with the point at which the Internet started to become visible. That may live with been a coincidence, but there was another strange oddness in the figures. Investment by US companies since 1990 has been static in every area except in IT, where it rose dramatically by a factor of 14 over the decade. And to peak it all, the bulk of the productivity improvement in the US economy was confined to the IT industry itself.

In theory, IT should be counter-cyclical and it usually is. The do good that IT is supposed to deliver is automation. It either cuts costs and/or improves productivity, accordingly. The figures from the US suggest that it was doing the latter in the glorious 90s and particularly in the later years. In the current part of the business cycle it will be cost cutting that matters. The heady geezerhood of optimism are over and the era of cautious IT investment has arrived. So what are the information technologies that will do well in this era? Heres one thought. Consider the anomaly of Moores Law. This suggests that processor power will double every 18 months and it has do just that for over 30 years. Actually Moores law doesnt... If you motivation to get a full essay, order it on our website: Orderessay

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