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Economic Impact of Tech Understated, Study Says

kdawson posted more than 7 years ago | from the productivity-but-not-jobs dept.

The Almighty Buck 87

narramissic writes "A report (available here) released this week by the Information Technology and Innovation Foundation, a pro-technology think tank, claims that IT was responsible for nearly all of the US worker productivity growth between 1995 and 2002. But the creation of new jobs in IT will be modest, the study says. At a forum in Washington, D.C., the report's co-author and ITIF president Robert Atkinson warned lawmakers that there will be a 'significant cost to the economy if you hinder digital transformation' and called on the government to spur IT adoption in several industries, including health care, banking and transportation." The article also quotes an economist who is skeptical that this report's outsized claims for productivity gains have been proven.

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What about the impact (-1, Offtopic)

Anonymous Coward | more than 7 years ago | (#18361007)

of sperm in my keyboard ? I can't seem to lick it out. Suggestions ?

Re:What about the impact (0)

Anonymous Coward | more than 7 years ago | (#18361551)

use a straw

Environmental impact (1, Troll)

JackMeyhoff (1070484) | more than 7 years ago | (#18361013)

It is also very damaging to the environment.

Re:Environmental impact (-1, Offtopic)

Anonymous Coward | more than 7 years ago | (#18361145)

Who got the millionth user?

Re:Environmental impact (1)

Paulrothrock (685079) | more than 7 years ago | (#18361683)

Why is this modded troll? Electronics are very harmful to the environment. They're full of heavy metals and toxic chemicals, and there are toxic chemicals used in their production that aren't always disposed of properly. I guess pointing out uncomfortable truths is something most /. readers can't handle.

Tech companies and communities are starting to catch on, however. Several manufacturers will take your old computer when you buy a new one, and my county (Lancaster, PA) offers free electronics and household hazardous waste recycling to residents.

Re:Environmental impact (1)

smooth wombat (796938) | more than 7 years ago | (#18361767)

and my county (Lancaster, PA) offers free electronics and household hazardous waste recycling to residents.


I'm about 20 minutes from the border with Lancaster County, mind if I drop my old electronics at your place and you take care of them for me?

Re:Environmental impact (1)

Nef (46782) | more than 7 years ago | (#18361979)

I'm only a couple minutes from Lancaster county and I wasn't aware of this. In fact I know quite a few people who live in Lancaster County who also aren't aware of this.

Even funnier still, I live in Lebanon county where recycling is 'mandatory', yet I have to pay for the privilege of doing something mandatory. Waste Management hasn't said anything so far, and for the most part I just end up bringing recyclables to work but I'll be damned if I'm paying an extra $40 a quarter for them to pick up my mandated by law recycling.

BTW, for you and parent are you locals or transplants? I'm a transplant myself.

Re:Environmental impact (1)

Paulrothrock (685079) | more than 7 years ago | (#18362073)

Depends on how you define transplant. I'm born and raised in PA, but I've lived in Williamsport, Clearfield, Harrisburg, State College, Wilkes-Barre, Harrisburg again, and now Lancaster. (Near F&M)

And of all these places, Lancaster is the best by far.

Re:Environmental impact (1)

smooth wombat (796938) | more than 7 years ago | (#18362353)

I'm in Dauphin County and was born and raised here. Other than vacations, I spent two years away for my last two years of schooling.

I pass through Lebanon County on my way to New York twice a year though I've been to LVC once or twice.

I thought that my township had an electronic recycling program once or twice a year but I didn't see it last year and so far haven't seen it this year. Right now all I have is a 10+ year old monitor (from my 95 days) so I can hang on to it for now and even when I move until I find a suitable place to dispose of it.

Re:Environmental impact (0)

Anonymous Coward | more than 7 years ago | (#18364103)

Nerd/Geek pissing matches are just too funny.

What next who has the larger member?

Re:Environmental impact (1)

Paulrothrock (685079) | more than 7 years ago | (#18362121)

They've never checked my ID when I've gone there, and I've dropped off a ton of stuff. As long as it's not a huge truckload, I'd say just bring it yourself. It's on Harrisburg Pike, right about halfway between the Park City Mall and F&M.

They also take old paint, motor oil, and batteries.

Patents (3, Insightful)

Nerdfest (867930) | more than 7 years ago | (#18361025)

You want to stop hindering the digital transformation? Fine ... fix software patents. It seems like you can't create anything anymore without running into some obvious patent.

Re:Patents (4, Insightful)

AKAImBatman (238306) | more than 7 years ago | (#18361215)

Software patents aren't the problem. They're a serious issue unto themselves (mostly because the Patent Office's own procedures are never followed) but the real issue is with the managers in the companies. No one sees technology as a good way to smooth and streamline their internal operations. If that happens, it's mostly a byproduct of whatever work is being done on the customer-facing portion of the business.

The fact that you can build a smooth process internally to automate a great number of expensive processes (not to mention reduce the body count) tends to blow by the decision makers. They only think about it when they absolutely need something NOW. Which tends to result in a mess of Microsoft Access and Visual Basic "applications". Which they think is okay, because they don't realize the tremendous maintenece costs they're committing to.

There honestly needs to be a bit more focus on developing strategies for using technology in business. Those strategies should then be taught as part of the MBA programs. They may not really "get" it, but at least they'll understand that using X technology has Y consequences and that you need to rely on trustworthy staff to find the best tradeoff.

Re:Patents (1)

qwijibo (101731) | more than 7 years ago | (#18361301)

There are no silver bullet strategies. Delegation should be taught as part of the MBA program. I mean delegating responsibility and authority, not the common approach of delegating the responsibility and micromanaging the authority. Delegate the creation and maintenance of the computer systems to people who have expertise in that field and have familiarity with the business's needs and priorities. The people who are in the best position to understand the long term maintenance issues are the people who are maintaining existing systems and creating new ones.

Huh? (2, Insightful)

oneiros27 (46144) | more than 7 years ago | (#18361653)

IT can't smooth and steamline operations. It can make it possible to do so, but it can't do it by itself.

The types of solutions you're talking about isn't just a matter of dropping in a box, and suddenly everything's more efficient. It requires analysing the business processes, and determine where the issues are (and sometimes more importantly, why they're there).

I can't remember who said it, but they made a statement to the effect of -- technology can only make things go faster; if you have a bad process, it'll just make you fail faster.

I've see technology implemented in such ways that it slowed down the processes, because the system designers didn't understand what was going on. (eg, a switch to online forms, that made the forms more complicated, but they had people print them out, sign them, then fax/mail them in where they were re-entered by hand just as before... only with more fields on it now, some of which had been auto-populated by the online forms system).

The problem that I see is that managers think that some contractor being brought in and being paid $200+/hr knows more about how things work than their own employees do -- contractors who are being paid by the hour, and get paid more if things take too long, or need corrections later, etc. But, when you're making big money, management will listen to you, as opposed to the pool of people doing data entry who just want auto-complete on the system. Management gets sold on compliated new features that may not be useful for their situation. They want the biggest system they can buy, so they brag about it with their (golf|fishing|whatever) buddies.

As for the MBAs -- there are a few alternate management degrees out there that stress technology -- Master of Engineering Management; Master of Information Systems; Master of Information Management, etc.

Re:Huh? (1)

SatanicPuppy (611928) | more than 7 years ago | (#18361931)

Yes, and no. IT obviously needs to be involved and understand the processes going on, but to say that the people who are doing the process need to be telling IT what the process needs to be is fundamentally flawed for a number of reasons.

First, they don't understand the capabilities of the systems that could be brought in. Access applications are a prime example of what happens when a bunch of amatures get involved, because, in their minds, moving to access is a big step, because they don't understand its limitations.

Second, they're burdened by their own preconceptions of what the process should be. They have to worry about peoples feelings, and they have years of "how it has to be done" ingrained in their heads.

I once had an issue with people processing Obituary data...photos, text, money, etc. After working with the people involved for about a week, I got fed up and wrote their jobs out of existence...Automated things that I was told "could not be automated". Took a month for the crap storm to subside, people complaining about all the stuff I changed...They'd probably still be doing it but the errors dropped to a flat zero, and the customer complaints dropped just as fast. I rewrote a bulk mailing system which changed utterly the process by which mailings were assembled.

I got complaints for a month, and then I got complaints because part of the system was still running the old system, and they liked the new system better because it was more transparent.

I'm no fan of consultants either...One trick ponies, most of them, out to sell a single solution which may or may not address a problem that you have. However, a competent internal IT department who is in a position to both understand and support the business is usually in a far better position to come up with a process redesign than the department whose process it is.

Re:Patents (1)

MontyApollo (849862) | more than 7 years ago | (#18362143)

All those MS Access and VB applications cobbled together are an intrinsic part of a lot of small to medium size companies. The is one reason why Linux will have a hard time ever making much traction at the desktop level. A focused IT program will benefit Linux as well as moving a lot of the support to a true IT department, not whoever happens to be "good with computers." A lot of these MS Access and VB applications are put together by "power-users" (instead of IT) because that is what that they know.

Tech adoption is slow but steady (0)

Anonymous Coward | more than 7 years ago | (#18362203)

Tech adoption in business can't be avoided. It will happen, whether we try to accelerate it or not.

Why?

Because the numbers are just too good. The "machine" (whatever form it may take, from a tractor to a PC to a stapler) winds up saving money by making ten people able to do the work of 20. Over time, in baby steps, machines of various types will be incorporated into business processes and human labor will be eliminated. This will result in better productivity numbers for each company and the nation as a while.

There is a dark side to this of course. Sure, the people who lost their jobs are now free to do something more interesting....provided they can find something more interesting that pays. Sure, machines create new jobs too (production, maintenance, administration, etc). However, logically, the machines must create fewer jobs than they eliminate (otherwise their total cost of ownership will wind up being higher than keeping humans on staff, and they won't be adopted).

So as technology improves, and machines of any type reach a point where they eliminate more work than they create, they will become economically viable and they will be adopted. We couldn't stop it if we tried.

The machines free us from labor that we don't want to do. However, what happens when we as a nation become so free of labor that there isn't enough work? What happens when the machines make us so productive that 10% of the people can provide for the needs of themselves and the other 90% too? There simply won't be enough jobs for those 90% to all be productively employed, and so they won't be able to afford the goods that the 10% are making. This is a veritable human utopia, it is within reach, and our economy can't function in that environment. We will either start adopting more socialist values, or we will become ludites and legally inhibit technological advances in the name of protecting the worker.

I guess I kind of rambled. Oh well.

Re:Tech adoption is slow but steady (1)

mdfst13 (664665) | more than 7 years ago | (#18363253)

However, logically, the machines must create fewer jobs than they eliminate (otherwise their total cost of ownership will wind up being higher than keeping humans on staff, and they won't be adopted).
Unless expense was the barrier to increasing quantity supplied. For price elastic goods, dropping the price can *increase* the amount of money collected (because the increase in quantity sold outweighs the decrease in price). I.e. the machine may mean fewer jobs per item produced, but if the total number of items produced increases enough, it can offset the reduction. This is why the Fed is constantly increasing the money supply--to allow this additional production to be purchased. If they increase the money supply to much, we get inflation; if they don't increase the money supply fast enough, we get a recession.

By making things cheaper, the machines enable jobs that could not have existed without the machine. For example, is it really cost effective for every family to have its own troupe of actors and stage? No, but it is cost effective for every family to buy a television and share the same actors and sets. As a result, something that had been a rare treat (oh, the festival is in town, I bet there will be a play) or a special privilege for the rich becomes an everyday occurrence.

We're nowhere close to having machines capable enough to replace humans at basic tasks (for example, can a Roomba clean walls?). If we do get to that point, we'll have to rethink our current system (which is concerned more with scarce resources than abundant ones). Of course, we'll also have unlimited manufacturing capacity (at least at the labor level) at that point, so we should have plenty of resources.

Re:Patents (1)

a_quietamerican (960034) | more than 7 years ago | (#18362207)

Seriously? Are we really devoid of innovative digital solutions right now? And is the cause really software patents?

Sure. There is a lot of work to be done to ensure stupid obvious patents related to software don't make it out of the world's patent offices...but, there is no evidence that software patents are currently having a real, deleterious effect on innovation in the software industry.

I can't marry you because (-1, Offtopic)

DrakeDrakerson (1076119) | more than 7 years ago | (#18361117)

I'm in love with Bob from accounting!

Same Study From Iraq (0)

Anonymous Coward | more than 7 years ago | (#18361143)

The same study done in Iraq found that almost all economic growth in the region from the 5th millennium BC to the 3rd millennium BC can be attributed to the wheel & axle [wikipedia.org] . The Sumerians claimed slave productivity skyrocketed when it was discovered that they could be tied to wheeled carts to haul heavy equipment. Let us bask in the glory of technology!

It is because of the many meeting notices in my Outlook inbox that I am productive--and nothing else!

Re:Same Study From Iraq (2, Insightful)

lucabrasi999 (585141) | more than 7 years ago | (#18361187)

he same study done in Iraq found that almost all economic growth in the region from the 5th millennium BC to the 3rd millennium BC can be attributed to the wheel & axle. The Sumerians claimed slave productivity skyrocketed when it was discovered that they could be tied to wheeled carts to haul heavy equipment. Let us bask in the glory of technology!

Damn you, AC! You beat me to the punch!

AC is correct, this 'group' isn't exactly breaking new ground. Technology can improve productivity? Really? And, I always thought steam power was a step backward.

Re:Same Study From Iraq (1)

CheeseTroll (696413) | more than 7 years ago | (#18361419)

Well, you basically answered my question, and I'll answer yours. This report specified *Information* Technology, not just tech in general. Not exactly a new revelation to most /. readers, but I suppose it's a nice pat on the back.

OTOH, I was originally looking at this from an IT-centric point of view, in that I was left wondering "Well of course IT has been increasing worker productivity. What else *could* make people more efficient?" Completely forgetting that there are other industries besides those that manipulate data all day long. :-)

Re:Same Study From Iraq (1)

UbuntuDupe (970646) | more than 7 years ago | (#18361675)

Technology can improve productivity? Really? And, I always thought steam power was a step backward.

Steam powered textile looms weren't much more productive than cottage-based home production through the spinning jenny, the latter was just legislated away. Spade cultivation is much more efficient than the plow or mechanization, it's just more labor intensive. Everyone would be better off growing their own vegetables at home. Joint-stock and investment bank funding of ventures has never lead to better innovation than what would have persisted without, because it skews the incentive structure. Roads have only benefitted the extremely wealthy. [/crank]

Hinder? They can't even keep up (3, Interesting)

Dancindan84 (1056246) | more than 7 years ago | (#18361205)

We've already seen that laws (copyright for instance) have difficulty keeping up with technology. The laws have always been reactive in that regard. Never mind the fact that internet technology can't effectively be legislated against by a single country or entity. I don't think they really have to worry about government hindering the advance of technology. If one government tries to, the advances will just take place somewhere else.

Re:Hinder? They can't even keep up (1)

mastershake_phd (1050150) | more than 7 years ago | (#18361623)

I don't think they really have to worry about government hindering the advance of technology. If one government tries to, the advances will just take place somewhere else.

Which is bad for us here in the USA. I can't think of one country thats catching up though. Has China even invented One-Click shopping yet?

Re:Hinder? They can't even keep up (1)

Dancindan84 (1056246) | more than 7 years ago | (#18361805)

Yes, it could be. Cloning is an example of that I believe. While the ethics of it were still being debated in the US, research was taking leaps and bounds in Europe. Personally, I'm not sure which approach is better. I think that some things should be considered thoroughly before being pushed forward.

Banking and medical need MORE IT? (1, Insightful)

xxxJonBoyxxx (565205) | more than 7 years ago | (#18361231)

"...called on the government to spur IT adoption in several industries, including health care, banking and transportation."
...because, as we all know, modern health care and banking is completely conducted using paper transactions. Seriously, did this "study" float through a time rift from the 1960's?

Re:Banking and medical need MORE IT? (1)

boristdog (133725) | more than 7 years ago | (#18361299)

You'd be surprised at how little technology is used in MOST industries.

A few years ago I contracted at a semiconductor manufacturing firm that kept equipment maintenance records ON PAPER, and later transferred them to Excel. I quickly remedied that situation.

Last month I visited a bank that had to have all cash transactions written into a ledger.

The work is out there, kids, you just have to find it.

Re:Banking and medical need MORE IT? (1)

SpaceLifeForm (228190) | more than 7 years ago | (#18362295)

...records ON PAPER, and later transferred them to Excel. I quickly remedied that situation.

By using OpenOffice?

Re:Banking and medical need MORE IT? (2, Informative)

stratjakt (596332) | more than 7 years ago | (#18361345)

A great deal of modern health care and banking is completely conducted using paper transactions. Why do you think the whole of the state, country, or world operates exactly like the little part of it that you see?

Why does it take a check 7-10 days to be cleared? Is that the ping time between Bank of America and the issuing bank? No, but this system still works largely the same way it has for 1000 years. People, actual humans with eyes, check the numbers. I doubt this will change for a long time. Bank brass doesn't like the idea of removing that human "safeguard".

Health care is a fucking mess. Doctors aren't into computers, they have better things to do. Receptionists and clerical workers cobble around a mess of access databases and flat text files. Plenty of room to improve and streamline. This will change, but will have more to do with education. I have a friend who just completed a vocational cert in medical billing, and there was very little IT training involved. Some introductory word processing, and basic spreadsheet usage, and that was about it.

Transportation? All over the place again. For every company using high tech dispatching and tracking trucks with GPS and monitoring the engine wear in real time, there's a driver-owned rig tooling down the interstate with a big fucking paper map unfolded on the windshield.

Re:Banking and medical need MORE IT? (2, Informative)

Red Flayer (890720) | more than 7 years ago | (#18361593)

Why does it take a check 7-10 days to be cleared? Is that the ping time between Bank of America and the issuing bank? No, but this system still works largely the same way it has for 1000 years. People, actual humans with eyes, check the numbers. I doubt this will change for a long time. Bank brass doesn't like the idea of removing that human "safeguard".

Not at all. People don't check the numbers, scanning equipment does that. Checks take 3-5 days to clear because your bank makes money off the float (the time between when they receive the money and they give it to you).

Re:Banking and medical need MORE IT? (1)

Tiroth (95112) | more than 7 years ago | (#18361765)

That might be one motivation but it is hardly the whole truth. Until recently, banks were required to process the actual pieces of paper, so they needed to physically transfer the checks in order to clear them. Now they use an electronic process, but I'm certain that many small banks have not fully updated their systems yet.

Re:Banking and medical need MORE IT? (1)

Red Flayer (890720) | more than 7 years ago | (#18362023)

Now they use an electronic process, but I'm certain that many small banks have not fully updated their systems yet.
Under Check 21, banks (or intermediate handlers) truncate a check into an electronic image. Banks without the capability to handle checks fully electronically print an IRD (Image Replacement Document), a subsititute check, that they handle like the original check. This can then be truncated again by the next handler. What this means is that even though a small bank on the issuing side or the receiving side of the check that only uses paper documents doesn't slow the process much, since the intermediaries are almost all fully electronic.

Re:Banking and medical need MORE IT? (1)

Rolgar (556636) | more than 7 years ago | (#18363145)

Actually, it takes time because after the check is given to the bank, it has to clear the bank that the check is written against. If your bank allowed you to have full access to the funds before they had received the funds from the other bank, it would be a simple matter to have a buddy (or yourself) setup 2 fake accounts that cost a $50 deposit for each, and then write a check for $5000 from one account to the other, which you then take to the bank, deposit and instantly withdraw the $5000. By the time your bank forwards the check and finds out the account doesn't have the funds to clear the check, you've made off with a $4900 profit, and the banks have to track you down with as much to go on as a bank robber except you've got a 2 day head start. If your bank is nice, and you've had an account for a while, they might let you overdraw your previous balance by a small fraction of the deposit amount, but that depends on how good of a customer they consider you.

Re:Banking and medical need MORE IT? (1)

Red Flayer (890720) | more than 7 years ago | (#18363933)

Maybe you've mistaken me for someone who doesn't work with the banking industry.

Actually, it takes time because after the check is given to the bank, it has to clear the bank that the check is written against
Which is extremely fast since Check 21 passed and was implemented -- did you miss the comments about electronic processing of checks? Check validation typically now takes less than an hour.

Re:Banking and medical need MORE IT? (1)

foniksonik (573572) | more than 7 years ago | (#18361923)

The last time I was at the hospital (~2 weeks ago) the nutritionist came around with a tablet PC to take the breakfast/lunch/dinner orders ;-p

Oh yeah they had free wifi access all over the place too... very cool.

This was a very progressive hospital I'm sure.

Re:Banking and medical need MORE IT? (1)

Yoooder (1038520) | more than 7 years ago | (#18361385)

lol, sounds as though they did. I'm a software engineer for a banking service provider that focuses on processing transactions, and our company was founded on bleeding edge technology 40+ years ago and continues to be driven entirely by technology. We run the gamut in technologies, from Big Iron to do the number crunching to .NET SOA applications for our customers with everything in between. Although, last time I went to the hospital I did still have to fill out hardcopies (yech)

Let's talk about health care IT (3, Insightful)

UbuntuDupe (970646) | more than 7 years ago | (#18361531)

Why are we still in an age where doctors transmit prescription info to pharmacists with a nearly ineligible scrawl? Why are pharmacists still taking classes to learn how to read these? Why is it still possible to administer prescription/hospital medication without a computerized check for excessive dosage, drug interactions, and medical condition interaction. (e.g., "Hey, you just prescripted 20 times the highest typical dosage. You sure about that?")

Why does GE's health care division run ads bragging about how the accomplished the insurmountable task of ... computerizing records?

Why aren't expert-type systems routinely used at doctors' offices?

Why do doctors act like you're Satan if you ask questions based on knowledge you've gathered on the internet about your condition?

I could go on and on. Yes, health care has advanced technologically, but we still have multi-million dollar MRI machines next to doctors communicating by scribble and no clue about how to do CBA's for the whole process.

Re:Let's talk about health care IT (1)

Paulrothrock (685079) | more than 7 years ago | (#18362489)

The single biggest evidence is how popular culture perceives hospitals. Very, very rarely are they sleek places full of computers. Mostly, it's a place with mounds and mounds of paperwork and reams of filing cabinets and an old green-on-black terminal at the receptionist's desk.

Re:Let's talk about health care IT (1)

ColdWetDog (752185) | more than 7 years ago | (#18363345)

You got the money, honey, we've got the time. It's not that hospitals don't want to automate, it's just that it's expensive. In the US, medicine is so highly regulated that you can't raise your prices to make money. So, if you're a small clinic or hospital that doesn't happen to do the big ticket items like surgery and cancer treatment, your SOL.

What software that's out there is pretty dammned bad. I'm not sure why, but for smaller hospitals, we seem to be stuck in the late 1990's (And I'm looking at YOU Dairyland.)

Then there are training issues when you keep changing your nursing staff every 13 weeks because you don't pay them a decent wage and you have to fill in your blank spots with temp nurses (who cost more). And so on and so forth. As a physician who has worked with IT from the mid '90s and still has to scribble orders on paper, I'm truly amazed and annoyed that we've advanced so slowly and haphazardly. To really understand why, you have to delve into why the US medical system is in such a shambles and right now, my head aslode (and I have to go to work and scribble some more).

Re:Let's talk about health care IT (1)

lawpoop (604919) | more than 7 years ago | (#18364671)

"Why do doctors act like you're Satan if you ask questions based on knowledge you've gathered on the internet about your condition?"

Probably because it sounds exactly like a secretary telling that all of the spyware got into her computer when the techs upgraded her monitor.

Bodies are complex system and doctors study for a decade. We all know how silly it sounds when people who use their computers everyday try to diagnose their computer problems. Patients probably sound a million times sillier.

Re:Banking and medical need MORE IT? (1)

lucabrasi999 (585141) | more than 7 years ago | (#18361541)

because, as we all know, modern health care and banking is completely conducted using paper transactions. Seriously, did this "study" float through a time rift from the 1960's?

Health care is actually an interesting case. I've been on a couple of projects at health care firms. And, in both cases, the firms were heavily into technology. Many hospitals make large amounts of money in profit (even the 'non-profit' hospitals). So, they spend their money on technology. (At one of my projects, every single employee seemed to have a personal printer at their cube).

The problem with health care appears to be the 'interfacing' of technologies. Every time I have a family member in a hospital or physician's office, I seem to end up with a Billing error. Last night, I just had to call someone because they messed up the bill for an emergency room visit.

While some of these billing problems may be related to the general mess of Health Care in the United States, I think that the inability to interface between systems is partially to blame. And, technology can be the cure to this problem.

Re:Banking and medical need MORE IT? (1)

wytcld (179112) | more than 7 years ago | (#18361807)

the inability to interface between systems

Right. Doctors here in New England - and I assume across the country - have about half of their staff's time, and several hours a day of their own, spent in straightening things out between their own records and the systems of the insurers they need to collect from. Many are leaving practice because this is such a distracting, unrewarding diversion away from their core competency at delivering medical care. So every doctor's visit, you (and your insurer) have to pay for the staff the doctor has to hire to collect the fees from the insurer to - in substantial part - pay for the staff the doctor has to hire to collect the fees from the insurer to....

Meanwhile health insurers are under state regulation that allows them to essentially bill on a cost-plus basis - they're allowed to set fees at whatever level is required for profit. And for all the staff at the doctors' offices submitting stuff by fax and phone mostly, they staff themselves up on their end and are guaranteed a profit on it. That's why better than 1/4 of healthcare costs go to overhead at the insurance firms - which isn't even counting the overhead in the doctors' offices to keep all this going around.

A unified set of standards for computerized health care billing could reduce all this drastically, as well as the drag on our whole economy from the rapid escalation of costs. But since insurers are allowed, say, a 15% profit on the total volume of the cash they move, they have absolutely every incentive to fight something which would result in their laying off staff and shrinking the cost of their operations. They are perversely incentivized to bloat the system - and keep it away from computerized standards - for as many years as possible.

Re:Banking and medical need MORE IT? (1)

Paulrothrock (685079) | more than 7 years ago | (#18362729)

I think the greater crime is that this person spent four years in college and four years in medical school, plus a lot of residency time, and they're spending all that time doing what is essentially clerical work. How many more people could afford medical care, or could be seen by a doctor, if they weren't spending their time tracking down billing information.

Banking and medical (VA) need MORE IT? (0)

Anonymous Coward | more than 7 years ago | (#18363313)

"While some of these billing problems may be related to the general mess of Health Care in the United States, I think that the inability to interface between systems is partially to blame. And, technology can be the cure to this problem."

The VA is a good example of a sytem that could be copied.

Re:Banking and medical need MORE IT? (2, Informative)

Paulrothrock (685079) | more than 7 years ago | (#18361827)

There's still too much paper in health care and banking.

When I go to the doctor, I've got to fill out forms containing information that I've already filled out for that doctor or information that should be available to my doctor from other places I've filled it out. And I've got to fill out those forms on paper, which are then entered by someone else, increasing the rate of error.

My wife works as a TSS and she still has about an hour of paperwork to fill out every week. To fulfill HIPA requirements, it has to meet very strict requirements. She's been called in to correct things like lines not reaching to the edge of the form box or signing the paper in black ink instead of blue.

Restricting behavior to meet requirements is something that computer programs can do very well, but her company and the state haven't set up a system where she can log into a website, enter the information, digitally sign it, and submit it without using paper. And the worst part is that these forms she fills out must be retained even though they're digitized to be sent to

Finally, when I was getting my mortgage, they insisted that I fax information to them so they'd have a hard copy. Never mind that fax machines are almost negligible, never mind that fax machines are less secure than an encrypted email, and never mind that the functionality of the form could have been duplicated through a website. I was forced to take time out of my day to hunt down a fax machine and then pay to use it.

There's still too much paper in our society. And one of the main reasons for this is because the government hasn't stepped up to alter laws like HIPA that mandate paper copies of all information.

Digital Transformation? (1)

Grashnak (1003791) | more than 7 years ago | (#18361283)

ITIF president Robert Atkinson warned lawmakers that there will be a 'significant cost to the economy if you hinder digital transformation'
Exactly what is he talking about? Digital transformation? Is this just a buzzword for "progress" or "adopting new technologies"? Hell, the horseless carriage called. It wants its controversy back.

I know one thing... (1)

deadtree9 (772882) | more than 7 years ago | (#18361293)

I'm much more productive at viewing pron at work now! No more magazines for me! Hooray for the web!!!!

Alt+Tab (2, Funny)

MrClownLovesYourMom (1003061) | more than 7 years ago | (#18361307)

"a pro-technology think tank, claims that IT was responsible for nearly all of the US worker productivity growth between 1995 and 2002" This changed in 2003 when IT employees found a way to circumvent "Appropriate Workplace Internet Usage" restrictions.

An old and silly argument (5, Insightful)

Stu Charlton (1311) | more than 7 years ago | (#18361549)

The unwritten statement here that's implied by these sorts of studies is: "spend money on IT, increase productivity".

Which we know is false. IT and computing is squandered everywhere. Huge ERP installations go tits up regularly. Large systems integrators waste gobs of company's cash by running projects with clueless hordes & over-assertive managers that somehow mask that something that should take 3 people x 3 months should take 90 people x 2 years.

It also implies that IT vendors are responsible for the appropriate channeling of IT investment. This is like suggesting that weapons, communication, and transportation manufacturers should have been given credit for the Allied victory in WW2.

Investing - in anything - requires thought and management. It is good management that leads to an increase in productivity. Technology and computing capacity are just a means.

The paper is correct that technology can transform industries and markets, and that is a good source of productivity. But the catch is that there is no correlation between IT spending and transformation. Technology & computing capacity is "necessary but not sufficient" for transformation. Thus, it strikes me as a propaganda piece to squander billions with hardware & global services outsourcing.

A great source is Paul Strassmann's [strassmann.com] profitability & productivity studies, which he has conducted since the 1980's. He has plotted spending vs. productivity or profitability, in what is the now famous "scatter plot": there is *NO* correlation between IT spending and productivity & profitability. Yes, one CAN gain increases in both of these in concert with IT (witness the work of Toyota's lean approach, or Wal-Mart's data warehouse), but I'd attribute that gain to smart management plus technology over just IT.

Re:An old and silly argument (2, Informative)

ranton (36917) | more than 7 years ago | (#18361897)

FTA:

it is unlikely that the I.T. industry will be producing jobs gains out of line with its size.
Instead, the report contends, job gains will more and more come from industries that use information technology intelligently


This study does not claim that just spending money on IT will increase productivity. It quite plainly says that using IT intelligently will increase productivity. I find it very hard to find a problem in this logic. In fact, I find it so obvious that I am suprised someone needed to do a study to verify it.

--

Re:An old and silly argument (1)

Anonymous Brave Guy (457657) | more than 7 years ago | (#18362801)

The problem is that too many executives don't care about the obvious, or even what their own good people tell them. Instead, they believe what they're told by expensive consultants and the studies those consultants produce.

This isn't to say that consultants can't be valuable. Some consultants really do bring broad experience of things that work, deep thinking about what else could help, and an aptitude for identifying how to match those things up with the company hiring them. Such experience is hard to find in a single place, no matter how good your people are. You just have to understand that these things are not the only things that matter, which is why good consultants often start by surveying the relevant parts of the company hiring them and talking to the people in the trenches a lot. (Unfortunately, the bad ones usually do the same thing, because it means they can search-and-replace in their canned forms and come up with something with little value but enough buzzwords to convince execs that hiring them was worthwhile.)

Re:An old and silly argument (1)

khallow (566160) | more than 7 years ago | (#18363297)

Then you don't get the point of the study. No one intends to build unproductive IT infrastructure. But that's a common outcome.

Re:An old and silly argument (1)

SRA8 (859587) | more than 7 years ago | (#18369767)

Thanks for the clarification. Apparently the parent doesnt realize that failure is a possibility, not the goal.

But wait, there's more! (5, Interesting)

RonTheHurler (933160) | more than 7 years ago | (#18362557)

Digital technology DEFINITELY increases productivity, and decreases it too. It's all about the people, and what they do with it. It's not about spending money by any means.

Case in point- Using almost exclusively freeware and extremely cheap hardware, I've been able to create and build a company that needs only TWO employees to run ( http://www.rlt.com/ [rlt.com] ). And it makes a good income for both of us. Both of us are IT capable. Both of us know how to use digital technologies to our advantage.

Digital technology is the TOOL. Henry Ford said that if you need a tool, and you don't buy it, you end up paying for it anyway but you don't get to use it. Do tools make us more productive? Ask any carpenter to give up power tools and see what he says. By the same token, give a hopeless amateur a world-class workshop and the best materials to work with, and any chair he makes will still wobble. But give a master craftsman a hammer, a chisel and some scrap wood, and he'll make you a chair that will be sturdy, strong and will last a lifetime. It's all about the people, their skills, and their tools. I'd like to see any modern company try to compete without any computers in today's world.

Want to be more productive? Make more money? YOU are the master carpenter! And mostly, your employers are the hopeless amateurs who are using you as the tool! When I finally figured that out, I started my own business and I've never looked back.

As programmers and sysadmins, you have some incredible advantages over most MBAs. You have LOGIC. You are CREATIVE. You have a propensity for PROBLEM SOLVING. You can think through and visualize a plan of action from beginning to end. You can change course and re-program the system when requirements change. You know that very few, if any, projects are ever really finished. You're a hacker who knows how to shoot from the hip to get a job done on deadline, even if it isn't "elegant". You know that "Done" usually only means "it works at the moment and when it breaks, we'll fix it". Guess what, these qualities plus a willingness to try and fail then try again are what make entrepreneurs successful. Another advantage you have is that you won't have to hire some expensive tech guy to do your programming/sysadmin/DBA stuff for you. I can't count how many people have asked me who does my web sites. It's fun to watch the blank stare on their faces when I tell them "I did".

In short, don't BE the tool, USE the tool. Skills first, equipment second.

Re:But wait, there's more! (1)

a_quietamerican (960034) | more than 7 years ago | (#18362901)

Couldn't agree more with this post...so would the authors of the paper.

Re:But wait, there's more! (0)

Anonymous Coward | more than 7 years ago | (#18366021)

I've been able to create and build a company that needs only TWO employees to run (http://www.rlt.com/)...I can't count how many people have asked me who does my web sites. It's fun to watch the blank stare on their faces when I tell them "I did".
1998 called, they want their web design back. You *seriously* make money off that site? Wow, I'd turn away in a second based on the design.

Re:But wait, there's more! (1)

CodeBuster (516420) | more than 7 years ago | (#18368847)

Using almost exclusively freeware and extremely cheap hardware, I've been able to create and build a company that needs only TWO employees to run ( http://www.rlt.com/ [rlt.com] )

It shows...hehe, but seriously is there any reason why I should feel like I've taken a trip back to 1994 when I look at your website? How many potential sales are lost due to the amateurish website? If I were you I would invest a few bucks in a redesign or perhaps partner with a bigger retail outfit like Amazon. The business may be profitable now but imagine how much more profitable it could be with a better look and brand image, especially considering that you are in retail sales.

Re:But wait, there's more! (1)

RonTheHurler (933160) | more than 7 years ago | (#18370107)

Hah! What you don't know about marketing shows. I'm not trying to win any awards, and my customers aren't influenced by flash and dazzle. Yep, I've tried Amazon, and Ebay, and I even had a fancy web redesign done once on a bet. The designer lost- sales actually dropped, and I reverted back to the old one. I've also abandoned Amazon and Ebay- too expensive for too little returned. Cost efficiency is important too you know.

First rule of small business- know your market! Your market IS your business. Great service is what my customers value! Robert T. Kiyosaki said, in his mega best seller Rich Dad, Poor Dad, "I'm not a best writing author, I'm a best SELLING author!" In response to a pulitzer prize winner who was criticizing his work.

Case in point- I used to supply ThinkGeek with the Shot-Blade toy (I'm the exclusive dealer in the US) However, I sold FAR more of them on http://www.backyardartillery.com/ [backyardartillery.com] than ThinkGeek ever did, in the same time frame. It's a really cool toy too! review- http://www.dansdata.com/shotblade.htm [dansdata.com]

Design is mostly an ego trip for the designers. Results are what counts, and I doubt many of my customers are designers!

Now, go have some fun! - http://www.rlt.com/ [rlt.com]

Re:But wait, there's more! (1)

Teckla (630646) | more than 7 years ago | (#18377383)

Robert T. Kiyosaki said, in his mega best seller Rich Dad, Poor Dad, "I'm not a best writing author, I'm a best SELLING author!" In response to a pulitzer prize winner who was criticizing his work.

That book was almost entirely fiction. It's highly likely that comment and retort never even took place.

Not to mention, the contents of the book are almost entirely complete and utter nonsense....

Re:But wait, there's more! (1)

RonTheHurler (933160) | more than 7 years ago | (#18378443)

Perhaps. I'm in no position to challenge that claim. But how many months was that book in the NY Times best seller list? I agree that the contents were mostly fluff, but damn, authors (best selling authors) typically get 10% of the retail price in royalties. At $10/book, that's $1 to the author, times well over a million copies sold. And the hardback version was more than $10.

So, the quote holds true whether it really happened or not. His book may have been terrible literature, the grammar was atrocious, and he tended to be redundant, but the important thing to remember is that it SOLD well! Very well.

One other rule of business I've seen to be true is that "there's a huge difference between a compliment and a contract."

So, to summarize, when starting your business use freeware, cheap hardware, develop or retail important skills, concentrate on what your market is/wants/expects, satisfy that, and ignore the naysayers and critics.

Also remember this- There are a million reasons why your business will fail, and only one reason why it will succeed, YOU. You have to make it happen. Robert Kennedy said, "Things do not [just] happen, things [must be] made to happen." So, to be successful, follow the words of Jean-Luc Picard and "Make it so."

(And don't forget to have some fun! I'd suggest some AirZookas or Zero Blasters for impromptu office battles - http://www.backyardartillery.com/ [backyardartillery.com] )

Re:But wait, there's more! (1)

Teckla (630646) | more than 7 years ago | (#18385295)

So, the quote holds true whether it really happened or not. His book may have been terrible literature, the grammar was atrocious, and he tended to be redundant, but the important thing to remember is that it SOLD well! Very well.

I'm sure it did. "There's a sucker born every minute."

So, to summarize, when starting your business use freeware, cheap hardware, develop or retail important skills, concentrate on what your market is/wants/expects, satisfy that, and ignore the naysayers and critics.

Please know that I'm not criticizing your suggestions for starting a small business. I'm just criticizing "Rich Dad, Poor Dad". Nobody should waste their money on that nonsense.

Re:But wait, there's more! (1)

RonTheHurler (933160) | more than 7 years ago | (#18370133)

Oh, I almost forgot - Craigslist.com "has all the visual appeal of a pipe wrench."
I forget who said that, but they're obviously doing all right!

Here's my personal favorite set of toys (that I sell) - http://www.exexeq.com/ [exexeq.com]

How I love doing product evaluations!

Re:But wait, there's more! (1)

mcrbids (148650) | more than 7 years ago | (#18371613)


Case in point- Using almost exclusively freeware and extremely cheap hardware, I've been able to create and build a company that needs only TWO employees to run ( http://www.rlt.com/ [rlt.com] [rlt.com] ). And it makes a good income for both of us. Both of us are IT capable. Both of us know how to use digital technologies to our advantage.


Hear here!

I've managed to build a company (as the CTO) that manages some 70 schools and school districts - grades, attendance, massive quantities of paperwork, etc.

Our hardware is midline, Linux-based. We recently assumed a customer who had a big, expensive software package that ours replaced. All of their data was loaded onto a single server, and works fine, where the server's resources are shared with many other districts.

The kicker is that they had a cluster of 8 late-model machines to keep their old software going, and performance was always a problem!

Additionally, our administration overhead is VERY low - backups are performed regularly, off-site, with dual-network redundancy, and it's all fully automatic! (thanks shell scripts!) At every stage of the game, our servers and software are carefully set up to exhibit "positive dynamic stability" - they should just "do the right thing" without alot of guss.

This can be hard to do, but is ohhh so worth it when you start to scale upwards!!! I read once somewhere that this concept is called "autonomic computing". Sounds nice, eh?

Re:An old and silly argument (2, Insightful)

a_quietamerican (960034) | more than 7 years ago | (#18362691)

Agree with Ranton. I know Mr. Atkinson pretty well, and he is certainly not writing this as a simple "invest in IT" propaganda piece.

The main idea is that IT has been the key driver of growth in productivity rates around the world (despite some stupid IT investment by companies/governments). However, his conclusion is not that the world should just spend indiscriminately on IT. Instead, companies and governments should take their investments in IT more seriously because of the value of intelligent IT investment can have on businesses and the economy as a whole.

   

Re:An old and silly argument (1)

wordsthatendinq (971620) | more than 7 years ago | (#18364301)

Agreed.

From the summary:

The article also quotes an economist who is skeptical that this report's outsized claims for productivity gains have been proven.
I only glanced at the report, but there's good reason to be skeptical. It cites a lot of literature but does scant empirical work - if you look at the graphs they basically just take a bunch of time series datasets and line them up with each other. There's no good reason to believe that they show a causal relationship between the IT figures and the economic figures. Although they pose many plausible qualitative explanations, I don't really see any original research that tests any untested theories or devises any new ones.

I just don't know what to take away from the fact that this study has gained so much press coverage.

Fairly obvious? (2, Insightful)

ranton (36917) | more than 7 years ago | (#18361583)

Isnt it fairly obvious that technology is primarily responsible for our increase in productivity? I mean, where else would it come from? It isnt like our generation became more hard working than our parents.

Computer technology was basically the one thing that changed in the 90s to increase worker productivity. I cannot even think of a number 2 contender. Doing work on computers instead of on paper leads to vast increases in productivity. And we are constantly getting better, even with side tracks such as Vista. ;-)

I wonder if I could get money to do obvious studies. I am going to try to find out if having an active sex life makes people happier, or if eating more helps solve hunger.

--

Something else changed... (1)

AmazingRuss (555076) | more than 7 years ago | (#18365095)

...the level of indebtedness of the average Joe. It's easy to get somebody to work 60 hours a week if losing a job means losing everything he 'owns'.

Re:Fairly obvious? (1)

Seantotheizzo (1011799) | more than 7 years ago | (#18365809)

What about education? I'd say education standards have been on the rise for a very long time, at least in my home state (New York). "No Child Left Behind" fiasco aside, I think education would be the #2 factor for an increase in productivity, although it trails far behind technology IMO.

Re:Fairly obvious? (1)

ranton (36917) | more than 7 years ago | (#18366477)

What about education?

I guess that is possible, but I have generally only noticed the degredation of our education standards. Grade inflation and "teaching to the tests" is rising rapidly. All I see is more people getting degrees just because the quality of those degrees is diminishing.

--

Re:Fairly obvious? (1)

timeOday (582209) | more than 7 years ago | (#18366151)

Isnt it fairly obvious that technology is primarily responsible for our increase in productivity?


An MBA might think more about things like how industries are structured and how people are managed. An economist might think about fiscal policy, demographics, and the increasing numbers of women in the workplace over the last 50 years. A politician would probably think about unemployment numbers and maintaining consumer confidence so people will continue to spend (and keep pumping up the GDP on the treadmill of debt). And to be fair, those things count for a lot. The USSR lost the cold war through lack of productivity, yet their high technology was very advanced and they had abundant natural resources.

Re:Fairly obvious? (1)

ranton (36917) | more than 7 years ago | (#18366379)

Im sorry, I did say during the 90s. I agree that over the last century there were many other factors. I was just saying that during the 90s the only thing that really changed was our increase in IT technology. The USSR had already collapsed by that point, and women had been in the workplace for decades.

--

Re:Fairly obvious? (1)

timeOday (582209) | more than 7 years ago | (#18368421)

I just mean the USSR as an extreme example. Consider all the acquisitions, divestitures, and restructuring of companies. Or Bush's controversial tax cuts, or globalization (NAFTA etc), or the slashing of benefits, or the move away from lifelong employment. At best I'm ambivalent about some of these changes, but isn't it possible that these actually do serve some economic purpose, as the people behind them seem to think?

how many IT personnel does it take to... (1)

3seas (184403) | more than 7 years ago | (#18361791)

...screw in a light bulb?

Can we increase that number and NOT take european length vacations, here in the states?

Re:how many IT personnel does it take to... (1)

Paulrothrock (685079) | more than 7 years ago | (#18361945)

Why wouldn't we want to take European length vacations? I'd gladly take a month off every year and only have to work 35 hours a week.

Re:how many IT personnel does it take to... (1)

beerdini (1051422) | more than 7 years ago | (#18362031)

IT personnel change a bulb...what are you talking about?

You have to fill out a maintenance request, get supervisor approval, send the request to the maintenance department, just about when you forget about it somebody from maintenance finally comes in with the wrong light bulb, send request back through management to order the correct bulb, finally get the correct bulb, and just after you get used to working in the darker room the maintenance guy returns and actually changes the bulb.

Total time: about a month if you're lucky.

Tech != computers (0)

Anonymous Coward | more than 7 years ago | (#18361863)

Technology has driven economic growth for well over a century and farther back. In the beginning of the 20th century [wikipedia.org] agriculture wasn't much more advanced than it was in the middle ages. Most people alive in 1900 were farmers and farm workers. Now, drive through Illinois at harvest season and you see a giant combine driven by one person that picks the corn, shucks it, and shoots it into a giant trailor. That one guy can pick and shuck more corn than a few hundred people could a century ago.

Likewise, in non-farm industry during the 1800s they went from craftsmen crafting one item at a time by hand to factories, first with firearms and in the early 20th century with autos and about everything else.

Carbon paper? Whiteout? What are those, Grandpa?

Some good and useful tech has died; I wrote an article at K5 several years ago about it. Google K5 for "useful dead technologies" (it doesn't include carbon paper or whiteout!) if you're interested.

On a meatspace-related note, I get to work an hour before my boss. She had a job on my chair this morning she expected to takle several days, I had it on her desk before she came in. Tech is only useful if you know how to use it effectively!

-mcgrew (sm62704. Sorry for the A/C but I'm at work right now. Viva productivity!)

Walmart did at least as much as high tech (0)

Anonymous Coward | more than 7 years ago | (#18362209)

Actually, Walmart is responsible for much of the worker productivity gain in the 1995-2000 period; some studies put Walmart's share as high as 50%.

And they did it the old-fashioned way, by pushing down wages and working their employees to the bone.

This gets back to a recent /. story (1)

hey! (33014) | more than 7 years ago | (#18362545)

About whether CS is obsolete.

The argument is that since companies can buy most of the software they need "off the shelf", they don't need to hire CS grads to make new software for them.

CS is really only obsolete when companies stop innovating. A company that innovates will, very probably in today's business environment, require new software to help it produce its innovative services and products.

My opinion is that availability of CS talent is a limiting factor in innovation. Obviously it is possible for some innovations to be implemented using off the shelf software. But many potential innovations need support beyond the technical skills needed to slap a VB application together. A shortage of top notch CS expertise means that innovations requiring non-trivial software don't get past the imagination stage most of the time.

It's a chicken or egg situation. If there were 10x the number of people with first class CS skills running around, there would be more than 10x the number of jobs for them.

That's why I think the idea of a guest worker program in technology is a good one. Just not H-1B as we know it. The problem for US workers isn't that H-1B brings in workers who take their jobs away. It's that H-1B brings in workers, keeps them here until their experience makes them ready to take US jobs away, then kicks them out of the country. It's precisely the wrong thing to do if you want to foster innovation in the US, precisely the right thing if you want to outsource innovation overseas.

It is even more than they say... (1)

mi (197448) | more than 7 years ago | (#18362565)

Not only did the productivity grow, the jobs are easier to do. Even a slacker armed with computer is more productive, than his/her hardworking predecessor with only a desk (and, perhaps, a typewriter).

We can visit /. for an hour a day and still be reasonably productive...

pardox of the "productivity paradox"? (1)

peter303 (12292) | more than 7 years ago | (#18362631)

In the 1980s and early 1990s some economicits looked the economic return of buying large numbers of computers and networks and claimed they couldn't find it. This was called the "productivity paradox". The current study now says that computerization is the only factor generating economic return. Yet another interesting paradox?

Silly (1)

athloi (1075845) | more than 7 years ago | (#18363637)

All money is made nowadays by shuffling stuff around in databases. It beats farming or manufacturing for comfort.

Seems kind of obvious. (1)

br0d (765028) | more than 7 years ago | (#18364253)

Nation moves from agrarian, to industrial, to information economy just as 50 or so sociologists have predicted in the last 100 years, suddenly becomes news, film at 11. Why would agrarian and industrial markets expand in a country where the labor and tax costs are higher? Quick! Protest the IMF/WTO!

pro-technology think tank (1)

RealGrouchy (943109) | more than 7 years ago | (#18369953)

...the Information Technology and Innovation Foundation, a pro-technology think tank...

Oh, goodness. They've already got a think tank?

Next, the robots will be pushing for the right to vote!

We're doomed!

- RG>
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