Productivity Paradox - Qualifications

Qualifications

By the late 1990s there were some signs that productivity in the workplace been improved by the introduction of IT, especially in the United States. In fact, Erik Brynjolfsson and his colleagues found a significant positive relationship between IT investments and productivity, at least when these investments were made to complement organizational changes. A large share of the productivity gains outside the IT-equipment industry itself have been in retail, wholesale and finance.

Computers revolutionized accounting, billing, record keeping and many other office functions; however, early computers used punched cards for data and programming input. Until the 1980s it was common to receive monthly utility bills printed on a punched card that was returned with the customer’s payment.

In 1973 IBM introduced point of sale (POS) terminals in which electronic cash registers were networked to the store mainframe computer. By the 1980s bar code readers were added. These technologies automated inventory management. Wal-Mart Stores was an early adopter of POS.

Computers also greatly increased productivity of the communications sector, especially in areas like the elimination of telephone operators. In engineering, computers replaced manual drafting with CAD and software was developed for calculations used in electronic circuits, stress analysis, heat and material balances, etc.

Automated teller machines (ATMs) became popular in recent decades and self checkout at retailers appeared in the 1990s.

The Airline Reservations System and banking are areas where computers are practically essential. Modern military systems also rely on computers.