The Business of Software: What Every Manager, Programmer, and Entrepreneur Must Know to Thrive and Survive in Good Times and Bad

As the literature on the software industry is rather thin in my view, I think this book fills a useful niche. There are a ton of start-up guide books involving software and success bios but none of these take an analytic view of the software industry and its economics. If you happen to be interested in business model design, this work will also give some useful insights.

This is a fantastic book that every person interested in software, its business and the issues associated with its development needs to read.

クスマノ教授は、マイクロソフトなどの研究で有名なMITの教授ですが、この本は難しいアカデミックな理論を展開するのではなく、氏の経験やデータからソフト業界のビジネスの特徴や注意すべきことを論じています。クスマノ教授は、米国はもちろん、日本の大学で教えていたこともあり、日本のソフトウェア会社にも通じていますし、ヨーロッパの会社のアドバイザーも務めていたようです。その経験からの洞察は大変貴重で参考になります。日本のソフトウェア業界の人は、読むと「そうだと思っていた」ということが実感できると思いますし、今後、注意すべきことも整理できると思います。

Cusumano keeps surprising me with the timeliness of the books that he has published during the years. Back in 1995 I was head of development for a software company and once I got hold of his book "Microsoft Secrets: How the world's most powerful software company creates technology, shapes markets, and manages people" I became a believer in Cusumano's work. The follow-up work from Cusumano and co-writers have become part of my software engineering and software business library. The last work from Cusumano "The Business of Software: ..." is very timely as software market is evolving rapidly towards commodity business where end user organizations expect to buy and pay for software based on different grounds and premises than before.Cusumano's book reflects on many hot topics that EVERY software executive should be aware of like different software business models with corresponding economic metrics, setting up market segmentation with predictable revenue models, best practices in software development, outsourcing to low-cost countries like India and China etc. Also, Cusumano discusses thoroughly about software entrepreneurship and issues when setting business strategy and what impact venture capitalists could have for a software vendor. I believe that many software organizations do not understand what it really means to be run by venture capital driven Board of Directors. According to the ten case studies outlined in his work, some healthy software companies were pretty much destroyed by VC's and this is certainly not something that one should want to happen. Cusumano lists eight points that one should look at when evaluating software businesses. This was very helpful for me to reflect on and see how my company rates when evaluated against these eight points.This book should be read by EVERY software executive that wants to be updated of what is going on in the software business. This is one of the very few available books that specifically address the needs of a software businesses and this makes this book even more valuable. Cusumano outlines ten different case studies in his book, some complete failures and some successful and each and every one of these case studies have a lesson that we should learn from. We seem to think that we have seen it all, but the best way to learn is to learn from mistakes and never repeat these mistakes. Unfortunately we tend to forget this rule and I have decided long time ago to learn from others and then apply this knowledge in my own software business. I have introduced several successful products by remembering this rule. I also recommend you to read other books from Cusumano and the experiences that he shares from tens of different businesses.

This book was part of a course that several friends took at MIT Sloan. I bought it when I started a role and needed to beef up my software knowledge. I think that Michael, the author, really understands the software business. It was a well-written book and very educational. That said, it doesn't really come to mind when I'm recommending my favorite business books to anyone - so it wasn't incredibly memorable for me.