Blah Blah Cost, Blah Blah Cost, . . .

By Paul Evan Peters

Sequence: Volume 29, Number 4


Release Date: July/August 1994

blah cost, blah blah cost," and so on, ad infinitum. Costs and how to
reduce them are of compelling, consuming interest to all academic
presidents and corporate CEOs these days. What's more, those presidents-
-and their finance and business officers--are particularly interested in
how to calculate the payoffs on their investments in information
technology.

Information technology, particularly networking, is changing the ways
costs and benefits are generated, recovered, and diffused across the
entire chain of activities and relationships that link the creators and
users of scholarly and scientific works.

The life cycle of scholarly and scientific information contains five
major phases: creation, editing, production, distribution, and
utilization. The ways that using network resources affects the
cost/benefit ratio must be viewed in terms of that entire information
life cycle. Otherwise, an apparent cost saving could be nothing more
than a disguised cost transfer that offers no real benefit to the
overall scholarly and scientific communication and publication
enterprise. Top managers are no longer deceived by budgetary shell games
of this sort. They recognize that a change that benefits one specific
area does not necessarily translate to benefits for all areas. For
instance, when scholarly publications in a specific science are entered
into a database under author and title listings only, it certainly
produces a cost savings, because determining and categorizing subject
headings represent the most time-consuming part of data organization.
However, the short-term cost savings would actually be a long-term loss,
for the publications could then be accessed only by the select few who
followed that literature field closely, rather than by the myriad
scholars in other fields who might have a need for that information at
some point. These related life cycles must be taken into consideration
in an assessment of the real promise of specific cost-saving ideas and
claims.

Likewise, in the business world, corporate executives have found that
the benefits of using information technology must be measured
differently from the benefits resulting from, say, adding a new
manufacturing plant. In the service sector, information technology has
greatly enhanced the industry's performance, but the traditional
economic measures of productivity do not indicate a corresponding
improvement. Researchers have noted that productivity in many cases is
measured inadequately: For the most part those productivity measures
reflect neither the aspects of service quality--such as speed or
convenience--that are affected by technology nor the alternative cost of
what would have happened without technology.

Similarly, improvements in the way colleges and universities deliver
their product--knowledge--are just now becoming apparent, but only years
after campuses were wired and courses revised to accommodate networking
technology. The technical capabilities of graduating students and their
ability to adapt to a rapidly changing workplace often are not reflected
in a university's bottom line. In addition, networking technology has
enabled universities to reach out to the nontraditional students who are
increasingly representing the new majority of new learners. And no
institution can know how many students it would have failed to attract
without networked resources present on campus.

As academicians involved in integrating networking technology into
scholarly endeavor, we need to work at the regional and national as well
as the institutional levels, because experience to date strongly
suggests that cooperative, interinstitutional strategies will play a
major role in realizing the cost savings promised by networked resources
and services. College and university presidents will welcome and reward
such efforts, as will the scholarly and scientific communities that we
all serve.

For further explorations into these issues, see Serials Review
(1992,18:2-2); reports of the Research Libraries Project of the
Association of Research Libraries and the Coalition for Networked
Information played key roles; the HEIRAlliance Executive Strategy Series
Report #4 ("What Presidents Need to Know...about the Payoffs on the
Information Technology Investment").




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