Chapter 6: Software Supply Industry

Overview

Specialization is a feature of every complex organization, be it social or natural, a school system, garden, book, or mammalian body.

—Catharine R. Stimpson

While the managerial perspective of chapter 5 defines the steps and functions necessary before users can benefit from software, this does not by itself define how industry is organized to provide these functions. At one extreme, an end-user organization may undertake the creation, provisioning, and operation of an application on its own behalf, although it would invariably incorporate software products and tools from software suppliers. At another extreme, all these functions may be undertaken by different companies. The actual organization influences how effectively the user is served, as well as efficiency and costs.

In this chapter, the industrial organization surrounding the creation (including analysis and implementation), provisioning, operation, and use of software is considered. Primary goals are to understand the rationale behind current organizational approaches observed in the industry as well as the range of possible alternatives and some forces that may be driving the industry toward alternative organizations. Industrial organization is also an interesting and changing picture within the software creation industry (see chapter 7).