The Productivity Paradox...When new tools promise higher productivity, but fail to deliver.
I came across this concept last weekend when I was reading Tim Harford's "Fifty Inventions that shaped the Modern Economy". He was talking about the Dynamo's, and how their invention was supposed to revolutionize the industrial era. When the Dynamo was invented, factories still ran on steam generators. Most factories were had huge steam engines that delivered power to the rest of the building through a central drive shaft. If you wanted mechanical power in your part of the factory to power a new do-hickey, then you would have to attach to the central drive shaft to drive your equipment.
Economists noted that after the invention of the Dynamo, most factory owners were interested in clean and reliable power from a nearby electricity generation station, but the way they used the power turned out to be the key difference in realizing a return on investment. If you were a factory owner that simply replaced the steam engine with electric power to drive the central driveshaft...then you weren't going to realize all the benefits of the new technology. After all, you just replaced an old engine with a newer shinier one. The new electric power provided an on-demand energy source that unlocked new scenarios and opportunities that before might have been too expensive or difficult to implement. Factory owners had to adapt to this new landscape where power was clean, could easily power small machines, be easily deployed in smaller facilities, etc. This allowed people to focus on generating new ideas and innovations which drove the overall productivity. As more and more factory owners understood how to make the most of the new dynamos' and motors, new ideas about manufacturing spread and contributed to the growing economy and overall productivity.
As I was reading this, I thought about the current Digital Transformation underway in each industry and how Cloud Computing is disrupting the marketplace. As companies embrace the cloud, some are doing a simple lift and shift to the Cloud, while others are embracing new patterns and processes of doing business in the Cloud. Companies who transform the way they work in the Cloud will realize the full benefits while others who just migrate their workloads and don't change the way they work will not see significant gains. It is just the modern-day equivalent of "replacing an old engine with a new shinier one".
I was recently having a conversation with a customer talking to them about using the Azure SQL database service. They wanted to setup a new SQL Server because their existing development server had run out of space. To procure, setup and get the server operational was going to be at least 2 months of lead time. And to top it off they would not be able to fully realize the return on investment till the end of the first year because the server would be underutilized in the first year. They were asking me about setting up a SQL Server in Azure to cut down on hardware procurement time. That would have helped, but I walked them through the SQL Azure service, and how they could be up and running in less than 5 minutes (additional time to populate the database.)
The SQL Azure service would get them a fully managed database that significantly reduced their operational overhead, and they could focus on building new features. They could use the same time to leverage SQL Server Data Tools and implement DevOps processes which would save them even more time and money on each future development. Leveraging Azure SQL, they could dynamically scale the DTU's up and down during the day for more savings. Their customers had always asked for a few Big Data features, but they didn't have access to large SQL servers for development or testing. Now with SQL Azure DTUs on demand, they could easily run their tests and ship newer features.