Research Program in Information Technology applied to Public and Business Administration - e:lab

Presentation

The world economy is currently in a state of flux and constant change, experiencing shifts of paradigm with the need to establish new business models and implement innovatory public policy. This process of change comes in the wake of constant and successive technological innovations to which we are subjected, either as individuals or as companies. In this context, the Internet appears as a veritable watershed.

Why do dotcom companies, with hardly any tangible asset base, have shares traded on Wall Street at prices far in excess of their book value? Why does the ratio between the market value of these high technology companies and their book value, sometimes hit a figure of 100/1, whereas for traditional companies with a vast array of fixed assets this ratio barely attains 3/1? How have two companies with purely knowledge-based assets, namely AOL and Time Warner, recently negotiated a merger worth US$ 184 billion representing an amount greater than the GDP of many countries, such as Sweden, Norway, Switzerland, Portugal and Finland, etc, namely an amount sufficient to purchase 90 'Vale do Rio Doce' conglomerates and equivalent to 10 Paraguays, while two oil giants (Exxon-Mobil), with a large volume of tangible assets, signed a merger worth a mere US$ 77 billion? In the final analysis, what is happening in the world economy to lead even Alan Greenspan, the President of the US Federal Reserve, to call all this "irrational exuberance"? How does this "pseudo-bubble" of prosperity, albeit with fluctuations, manage to survive?

Nowadays, in order to survive in the business arena it's not just a question of using common sense, but of harnessing state-of-the-art business and technological management methodologies. These changes - which have become a sole constant - have defied businesses and their executives to forecast future trends and develop their intellectual capital, so as to take advantage of the technological revolution, which sweeps us all along in its wake. There is thus a need for a new underlying and paradigmatic logic for managing public and private institutions manifested through new mental models (schemata).

Information Technology (IT) by itself is a worthless technical marvel, though it is paramount for anyone who is either a public administrator or business executive, or aspires to become one, to know how to take best advantage of its added strategic value for both public and private institutions.

We are now entering the era of the virtual knowledge economy, based on intangibility, intelligence and innovation. Thanks to the Internet we are all connected by real-time digital links. Political, economical, social and job-related relationships are being transformed at an alarming rate. Where will this all lead to?

The inexorability of change has forced organizations, which seek to remain in the forefront as innovators and to be projected and seen to be adaptive living complex systems, to remain in a constant learning curve continually absorbing supplementary knowledge. In order to meet this challenge, the Getúlio Vargas Foundation has created e:lab - "Research Program in Information Technology applied to Public and Business Administration". This is an initiative of the Brazilian School of Public and Business Administration - EBAPE (www.ebape.fgv.br) of the Getúlio Vargas Foundation - FGV (www.fgv.br), in Rio de Janeiro, Brazil, launched in March 2001, to enable the School to research and remain abreast of the state of the art in the major challenges outlined above in order to establish an adequate environment to present and discuss the strategic use of Information Technology in the public and private sectors.