Custom Built Software Is a Depreciating Asset

Custom built software.  It occurred to me this week that this ‘asset’ as it’s categorized by GAAP is a depreciating asset, much like a car or piece of capital equipment ( machinery ).

Does it derive value?  Yes….indirectly.  But ultimately it’s value is underutilized, and quickly de-valued.

Imperfect as it is…there is little alternative….FOR NOW.   So what’s the best strategy for investing in this ‘asset’?

Minimize it.  The less you put in.  The less you lose.

Find the cheapest way to accomplish your custom software needs and invest in that first.  Any other investment strategy invites disappointment, and reduced expectations in the future.  This strategy, however stark, also recognizes the truth…..big things start small and simple.

Prove it out with a minimal project and then decide whether additional value could be derived.

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2012 Predictions

Here’s some of my 2012 predictions, ok…. guesses:

1. Real Options will become a bigger part of planning software and application development projects.  Unlike other projects we’re not discounting a straight stream of cash flows.  We’re discounting a complicated tree of decisions.

2. Scrum Will Breakup – The forces that made it popular will rip it apart.

3. Agile’s Luster Becomes Rustier – The torrent of zealous marketing and hype will take its toll on agile.  There will be increased backlash and doubt through 2012.

4. The Kanban Rock Will be Turned Over –  Executives will look into Kanban for software development and ask “Where’s the value here?”

5.  Managed Service Providers Will Enter Software Development – Utilizing contingent labor available through sites like Guru.com they’re finding ways to drive down the costs of software development for cheap, simple, fixed bid projects.

6.  Agile 2.0 Bandwagon – The agile 2.0 proponents will attempt to reboot life into the “movement”.

7.  Startups get faster, leaner – Driving towards continuous, high quality delivery…some startups will take Eric Ries Lean Startup philosophy further and push tool vendors, or even create their own tools.

8. Tools Start To Takeover – We may have stretched the limits of new practices and patterns.  Time for the tools crowd to take over?  NoSQL and the rejection of OOD&D as too complex for most development efforts may yield simpler higher quality tools.

I never can seem to round out my lists to 10.  How do other writers do that?  Oh well.  See you in the new year.  🙂

Stop Agilizing Everything

Introduction

Agile universities, certifications, agile consulting, traveling coaches, planning poker card sets, agile software products, agile modeling, agile arm bands, countless agile books and the crazed cycle of agile conferences.

WTF????

The buzz cycle is in overdrive and it’s electrocuted the business world with the promise of faster, better and cheaper.  This article is a plea to stop.  Stop all the hype, the opportunistic profiting, and the marketing.

Good Intentions Turned Ugly

What started out as a challenge to the software development community to think outside the box ( invent, create ), abandon a one size fits all model to approaching software development and execute your projects in a pragmatic fashion that takes account of the context you’re working in….has turned into a marketing machine of horrible dimensions.

There was a time when people talked agile and you knew they were on the vanguard; trying to solve the real problems.  They cared.  They were passionate, deliberate, and informed.  Now, when you hear a colleague professing agile…they’re most likely drinking the kool-aid poured by the snake-oil agile coach from Denver or San Fran.  The formulaic response to the core problems is all too familiar and draining:

  • Poor Requirements – You need user stories and iterations.
  • Defects in Software – Continuous integration and TDD will solve that.
  • Bad estimation – Use planning poker.  It always works.
  • Change Management – Break it up into iterations and embrace the changes given in iteration reviews.

I’m not knocking these techniques.  Many are novel inventions that do have their place in SD/AD.  But instead of being offered as potential options, patterns, techniques to solving a problem among many other potential solutions; they have become a sales pitch by the opportunist preying on desperate CIOs.  Buyer beware.  Bubbles pop and my gut says the needle to prick this balloon is getting very sharp and close.

Let’s stop agilizing everything. Good ideas, tools, and techniques don’t need the word ‘agile’ pre or post fixed to be worthwhile.

Come Back Home

So turn off the scrum-o-matic. Wipe the agile makeup from your face, and put the kanban sequin dress away. There are still problems to solve.  We haven’t unraveled this thing called software development.  It’s devilishly vexing and we need good minds focused on it.  Become neo-software-amish, come back home to the forest of software trolls and invent/create again.

We Need More Inventors Not Entrepreneurs

Introduction

This is a little off topic for this blog…..or maybe not.

Inventors

This past weekend I camped out in the backyard with my son.  I awoke in the middle of the night and saw the stars in the clear, crisp mid-western sky.  Whenever I see the night sky in this way I marvel at how we’ve been able to send men to the moon, and spacecraft to the planets in our solar system.  We’ve constructed massive, space born telescopes and instrumentation to visualize galaxies, nebulae, and stars light years from our planet.  The universe seems limitless and just beckoning our exploration.

So much of what we’ve accomplished is possible because people invented ways to solve problems. The progress of humanity is probably rooted on this simple point.  But what motivated them….were they looking for money?  Glory?  Were they seeking to incorporate and then accumulate and sell stock options?

In some cases this may have been the motivation…but the vast majority of inventions start with little or no profit motive…..just a sheer desire to solve a problem.   This brings me back to software.  I once asked a developer, “Why do you do this?  What motivates you to write code?”   His answer was honest and direct:  I like to solve problems.  At their core, many developers, are just inventors.   They can’t help creating and tinkering.  It’s who they are.  It’s what they’re called to do by some internal force in their genes.

Less Entrepreneurship

Entrepreneurship has its place, but I’d like to posit the notion that maybe it’s gotten a little too much credit in our hyper-capitalist world.  Maybe we need to get back to inventing things that solve problems and worry less about whether we’ll get rich doing it.

So if you’re a social media start-up or an investor in one these companies ask yourself this question:

What problem are we solving with this product that will benefit humanity?

If the answer is “none”….obviously you can still invest and do it.  But should you?  The world needs new solutions to real problems.   It’s always novel to see a recombinant of Twitter and Facebook, but there are starker problems on this planet begging for wickedly smart minds to help.

You’ll find no stronger capitalist in the world than myself, as such I recognize that the greatest reward often comes from the idea with the greatest risk and the opportunity least sought is the one most ripe for picking.

To Succeed Quickly = Fail Fast and Often

Loved this article and thought I’d put in my blog/tweet it out.  My take away?  Forget about success and failure….just try stuff, have fun, and learn/grow.  You don’t control all the variables anyway.  Focusing on gaining experience, contacts, and ideas.

http://www.theatlantic.com/business/archive/2011/08/the-5-secrets-of-silicon-valley/242958/