15.358 | Fall 2005 | Graduate

The Software Business

Lecture Summaries

1 Course Overview and Organization Introduction to the syllabus and course content, including introductory lecture on Strategy for Software Companies. Organization of the classes and student teams for forthcoming sessions.
2 Strategy for Software Companies: What to Think About Continued discussion of the key strategy issues for software companies - for example, how to balance products versus services, selecting a horizontal versus vertical market strategy, enterprise versus consumer customers, platform leadership versus complements, crossing or not crossing the chasm. Also turning software products into services, such as through hosting.
3 How Software Became a Business Discussion of how software evolved from a custom development or services business after WWII into a products business, with new generations of hardware and different devices pushing new areas of the software business. Short presentation from Imran Sayeed on lessons learned from NetNumina.
4 Microsoft® Case Study: Strategy, Management, Organization Discussion of what has made Microsoft® successful in terms of strategy, management principles (focusing on Bill Gates), and organizational design and capabilities. Short presentation from Imran Sayeed on the importance of software standards.
5 Managing Software Development: Basic Issues and Best Practices Discussion of the most common problems in software development that managers should be aware of, as well as common solutions ranging from waterfall development styles to iterative approaches.
6 Software Sales

Guest Presentation: Brian Halligan, former MIT student and former VP of Sales, Groove Networks

Discussion of key issues in sales strategies and techniques. We will discuss a specific case involving Siebel in CRM sales as well as draw on the experience of class members who have worked in sales.
7 Part 1: Software Marketing

Guest Presentations: Steve Kahl (MIT PhD student, former VP of Goldman Sachs; and Charles DeWitt, former MIT LFM student, former VP of Strategy and Planning, i2, current Director of Enterprise Marketing, Kronos Software)

Part 2: Software Entrepreneurship

Part 2: Software Entrepreneurship

We will examine some of the key factors that make for a successful software startup as well as a business potentially attractive to outside investors. We will also consider the case of a particular startup, and will have some of the entrepreneurs as guests in class.

8 Open Source

Guest Lecturer: Professor Alan MacCormack, Harvard Business School

Discussion of open-source development techniques and business models for companies that wish to compete in this space. We will also discuss the specific case of Red Hat.
9 Software Business Overseas: Outsourcing and Innovation

Guest Presentation – Izhar Armoney, Charles River Ventures. Specialist on Israeli software industry. MBA Wharton, currently a director of iPhrase, July Systems, Optaros, Proficiency, ThinkFire and Virtusa

Student teams will analyze and discuss the characteristics of overseas software markets and successful companies. We will also discuss the evolution of the software factory concept for custom development business models, and its movement from the U.S. to Japan and India. Short presentation from Imran Sayeed on software outsourcing and innovation.
10 “Emerging” Software Technologies/Companies - Paper Presentations 1 Student teams will make brief presentations on “promising” software-related technologies and companies based on class papers that they are writing. We will be forming these groups (usually 3-4 students) by the third or fourth week of the semester. The class and instructor will provide feedback and ideas for the analysis. Samples of topics discussed in prior years can be found in Cusumano, The Business of Software, Appendix X.
11 Wrap-Up The instructors will prepare some final comments on successful software business models as well as what else we have learned and not learned from the class discussions and team presentations.

Course Info

As Taught In
Fall 2005