I increasingly believe that BCG is doing the best thinking and writing on business and related topics, far superior to HBS, Stanford or McKinsey to name a few organizations. In a recent article in BCG.Perspectives, Why Technology Matters, there are two interesting quotes:
- "...the energy industry produces the highest income per dollar of technology spending ($24.24). At the other end of the spectrum, the software publishing and internet services industry produces the lowest ($0.98)."
- "...in the US, the IT cost per day of a hotel bed is $2.50, and for a hospital bed, it is $65. The IT cost of a car is $323."
My observations on each quote:
- Pricing in the energy market is probably the largest wealth transfer mechanism ever devised or to be devised. Increasingly the issue of income inequality comes back to governments that tolerate it or facilitate it.
- The low revenue/IT cost in software and Internet publishing is consistent with the relatively low value-add in those services
- The IT cost per day figures demonstrate competitive advantage to me and the lower the number the easier it is to use IT technology to disrupt the industry. Airbnb would be an example. BCG does not provide statistics for all industries, but I imagine the number is low for retail also where disruption is rampant. For your next entrepreneurship venture, calculating the IT cost might document the opportunity. Note, it might not document the timing.