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The Storage Economist

Is IT Automation and Productivity Responsible for High Unemployment and a Slow Recovery?

by David Merrill on Jul 27, 2011

I came across several articles this weekend that implied the stalled economy and high unemployment can be attributed to IT automation, doing more with less and improved business operations and functions. Are these not the holy grails of business and IT operation professionals? Some of the points in these articles seem to place poor employment data at our very doorstep:

  • Businesses’ ability to do more with the same or less — what economists term increased productivity — has been rising since the 1990s, thanks partly to technological advancements
  • Structural cost reductions that we have achieved over the past few years have allowed us to see strong bottom-line results
  • Economists say the ability to do more with less has helped create a two-speed U.S. recovery
  • Many (companies) benefited after slashing costs when the financial crisis hit and then keeping tight control on them even as sales recovered

So I guess all the preaching and planning to drive increased productivity is now being vilified as the source for stubbornly high unemployment….

Sorry to have contributed to this mess….

dmer1But I feel that placing some of this blame will not stop the ever-increasing demand for better returns, higher efficiencies and stronger bottom-line results. That is the driving force of capitalism.

The way I see it, IT and technological advancement have taken us so far with global efficiencies and doing more with less, but in the last decade or so, IT efficiencies has be the focus of business owners.

For many organizations, the IT productivity improvement has been real and demonstrable. Look at the admin ratios for servers, applications, or storage. Look at the number of virtual servers, logical TB or applications that can sit in a single square meter of DC floor space. Look at the shrinking (relative) data center space as we move to adjacent cloud computing infrastructures. Look at the cost of a TB of storage 12, 8 or even 4 years ago compared to now. We have seen dramatic impacts to both price and operational cost.

Do you remember the days of a good $5,000 TRS80 personal computer? And do you really want to go back to those good ol’ days?

Here is a link to a great e-book / How-To Guide HDS just completed with InformationAge (UK). This is a nice overview that can support any Virtualization initiative that you still may need to sell within your IT organization.

Just be careful that all these efficiencies do not throw you under the bus when it comes to finding blame for the economy or unemployment.

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Comments (1)

Wouter on 23 Sep 2011 at 6:32 am

David, nice article! Gives us some nice insights.

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David Merrill - The Storage Economist

David Merrill
Chief Economist

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