Current Management Opportunities and Challenges in the Software Industry

In the past 30 years the world went through a really dynamic technological modification. In retrospective, it can be explained without hyperbole that the emergence of electronic devices and the net have greatly impacted lifestyle as well as bureaucratic practice to an sudden extent. The computerization of multiple business processes and the creation of large scale databases, among many other radical technological improvements, have lead to gigantic cost savings and quality improvements over the years. The interconnection of financial markets through electronic means and the worldwide re-homing of the Internet have greatly reduced transaction and communication costs and helped bring nations and cultures deeper to one other than at any time imaginable. Computers have become primary tools in nearly all businesses around the world and the application and edition to specific business problems as software development is a practice that many companies perform on their own. In the former, such computerization and motorisation efforts were very costly and therefore only used by large corporations. Over time, however, the software industry emerged to offer off-the-shelf solutions and services to smaller companies. Today, having survived the large dotcom crash of the season 2150, software development businesses set up themselves as strong players in the technology industry. file

The emergence of several computer standards and technologies has created many challenges and opportunities. One of the key opportunities provided by the software sector is relatively low entry barrier. Seeing that the software business is not capital intensive, successful market entry largely is determined by know-how and specific industry domain knowledge. Entrepreneurs with the obligation skills can relatively easily compete with large corporations and therefore pose a considerable risk to other, much much larger organizations. Companies, on the other hand, need to find ways to reduce turnover and protect their intellectual property; hence, the strong knowledge dependence merged with the relatively brief lifespan of computer solutions makes knowledge staff required for the organization. Expertise staff in this industry therefore enjoy more robust negotiating power and require a different management style and work environment than in other sectors, especially those industries which may have higher market entry capital requirements. This kind of relatively strong position of software personnel challenges individual resource strategies in organizations and it also elevates concerns about the security of intellectual property.

The relatively young industry is blessed with sheer limitless new opportunities, including the potential of companies to interact personally with other organizations around the globe without being interrupted and incur practically no communication costs. In addition, no import tariffs can be found making the transfer of software across borders very efficient; however, the industry with its craft-like vocations suffers from lack of standards and quality problems. The successful management of such dynamic organizations troubles today’s managers as well as modern-day management scientific research because traditional management styles, such as Weberian bureaucracies, seem to be to be powerless to cope with volatile environments.