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The Business of Software: What Every Manager, Programmer, and Entrepreneur Must Know to Thrive and Survive in Good Times and Bad
The world's leading expert on the global software industry and coauthor of the bestseller Microsoft Secrets reveals the inner workings of software giants like IBM, Microsoft, and Netscape and shows what it takes to create, develop, and manage a successful company -- in good times and bad -- in the most fiercely competitive business in the world.
In the $600 billion software industry it is the business, not the technology, that determines success or failure. This fact -- one that thousands of once glamorous start-ups have unhappily discovered for themselves -- is the well-documented conclusion of this enormously readable and revealing new book by Michael Cusumano, based on nearly twenty years of research and consulting with software producers around the world.
Cusumano builds on dozens of personal experiences and case studies to show how issues of strategy and organization are irrevocably linked with those of managing the technology and demonstrates that a thorough understanding of these issues is vital to success. At the heart of the book Cusumano poses seven questions that underpin a three-pronged management framework. He argues that companies must adopt one of three basic business become a products company at one end of the strategic spectrum, a services company at the other end, or a hybrid solutions company in between. The author describes the characteristics of the different models, evaluates their strengths and weaknesses, and shows how each is more or less appropriate for different stages in the evolution of a business as well as in good versus bad economic times. Readers will also find invaluable Cusumano's treatment of software development issues ranging from architecture and teams to project management and testing, as well as two chapters devoted to what it takes to create a successful software start-up. Highlights include eight fundamental guidelines for evaluating potential software winners and Cusumano's probing analysis, based on firsthand knowledge, of ten start-ups that have met with varying degrees of success.
The Business of Software is timely essential reading for managers, programmers, entrepreneurs, and others who follow the global software industry.
In the $600 billion software industry it is the business, not the technology, that determines success or failure. This fact -- one that thousands of once glamorous start-ups have unhappily discovered for themselves -- is the well-documented conclusion of this enormously readable and revealing new book by Michael Cusumano, based on nearly twenty years of research and consulting with software producers around the world.
Cusumano builds on dozens of personal experiences and case studies to show how issues of strategy and organization are irrevocably linked with those of managing the technology and demonstrates that a thorough understanding of these issues is vital to success. At the heart of the book Cusumano poses seven questions that underpin a three-pronged management framework. He argues that companies must adopt one of three basic business become a products company at one end of the strategic spectrum, a services company at the other end, or a hybrid solutions company in between. The author describes the characteristics of the different models, evaluates their strengths and weaknesses, and shows how each is more or less appropriate for different stages in the evolution of a business as well as in good versus bad economic times. Readers will also find invaluable Cusumano's treatment of software development issues ranging from architecture and teams to project management and testing, as well as two chapters devoted to what it takes to create a successful software start-up. Highlights include eight fundamental guidelines for evaluating potential software winners and Cusumano's probing analysis, based on firsthand knowledge, of ten start-ups that have met with varying degrees of success.
The Business of Software is timely essential reading for managers, programmers, entrepreneurs, and others who follow the global software industry.
352 pages, Hardcover
First published March 2, 2004
24 people are currently reading
398 people want to read
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Displaying 1 - 18 of 18 reviews
August 22, 2009
This book is written for managers, programmers and entrepreneurs, and its topic is related to two major sciences: business and software. This might cause the reader to expect a solid organized book but this is not the case here.
The writer talks as if he is in a chat room. lots of chitchat, repeating of the same idea thousands of times in many chapters, information that are useless to the reader or at least out of context like the history of open source, which I don't need to know, I just need to know the effect of open source on the business of software.
The ideas and numbers related to the real topic, business of software, are mind opening, and they can cause the reader to change the way he looks at the industry, but it needs a big effort to overcome the boring sea of chitchat to get the few (but important) ideas and information in the book.
I think one of the main reasons behind this babble that fills the book is to increase the book size and number of papers. I Know the size of the book is important to the American reader but not to me. If this book was in 1/10 of its size (which what should have been), with solid organized idea explanation and no redundant information I would have given it a five stars rating.
The writer talks as if he is in a chat room. lots of chitchat, repeating of the same idea thousands of times in many chapters, information that are useless to the reader or at least out of context like the history of open source, which I don't need to know, I just need to know the effect of open source on the business of software.
The ideas and numbers related to the real topic, business of software, are mind opening, and they can cause the reader to change the way he looks at the industry, but it needs a big effort to overcome the boring sea of chitchat to get the few (but important) ideas and information in the book.
I think one of the main reasons behind this babble that fills the book is to increase the book size and number of papers. I Know the size of the book is important to the American reader but not to me. If this book was in 1/10 of its size (which what should have been), with solid organized idea explanation and no redundant information I would have given it a five stars rating.
June 10, 2021
An interesting time capsule to what was already known about the business of (business) software at the time of publishing. This book predates the SaaS business model and thus requires a lot of reading between the lines and extrapolation from the past. Having said that the book introduced some concepts that are evergreens. I also loved the brutally hones post-mortems of startups. The reasons for failure are have not changed since the book was published.
December 15, 2019
A little dated as its 15 years old, that being said there is a ton that is as true today as it was more than a decade ago. The fact that they still hold true underlines their importance and relevance. Ig nore them at your peril for sure!
March 1, 2021
A little outdated in some aspects, and too long in some parts.
But the examples make it interesting for younger professionals to learn about the tech history. In some parts we still deal with the same issues as in the early 2000's.
But the examples make it interesting for younger professionals to learn about the tech history. In some parts we still deal with the same issues as in the early 2000's.
November 19, 2022
It is a credit to Cusamano that much of this book- written in 2003 - has become conventional software wisdom in 2022. The services / product distinction is useful; but otherwise we don’t get much new.
November 25, 2025
a good, comprehensive review of the software industry though quite outdated already. Discussion and analysis on business models is outstanding, though.
February 1, 2008
Interesting but shallow overview of the software business. The case studies are the highlight - a look at product, service and hybrid startups with a couple of modest success stories but mostly failures. Other than this you're not likely to learn much unless you have little industry experience.
February 1, 2011
Very in-depth look at various business models. While reading I felt like it validated a lot of what I already thought and that I was learning a lot. Looking back what I can remember learning is that almost all software companies end up being a hybrid of product and services. Oh, and a lot of seemingly solid software start-ups fail.
September 2, 2007
Introduces the fundamentals of software business. Good strategical approach regarding things one needs to consider when founding and running a software company.
September 4, 2007
This was somewhat of an eyeopenner to me, but more from how chaotic and unorganized some of the firms used as cases were.
March 18, 2008
A bit difficult to digest/retain. Does offer some insight into the software business and software development techniques. Probably good to balance this with books written by practitioners.
Want to read
November 11, 2009Recommended by mmin
May 18, 2012
First half was informative, but the second half was a drag (paticularly the case studies).
October 14, 2012
Superficial and dated.
March 30, 2013
A should-read book on startups for knowledge workers and aspiring entrepreneurs.
December 29, 2024
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Chapter 2
Chapter 2
September 6, 2008
Great book if you are looking for a primer on the software business.
June 8, 2009
Good high level perspective...helps put some of the pieces together.
Displaying 1 - 18 of 18 reviews