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Is software eating the connected world?

In August of 2011, Marc Andreessen wrote what has now become one of the most famous quotes in our industry, “Software is eating the world.”

When I first heard this quote, it sounded scary, dangerous and even threatening. But what he really meant at the time was that software was transforming the world. He described how more and more businesses were run on software and delivered online as services, including everything from bookstores — remember when that was Amazon’s core vision? — to agriculture, entertainment and even national defense. As a result, he made a very compelling prediction, “over the next 10 years, I expect many more industries to be disrupted by software.”

Ten years later, all companies are software companies

On the surface, Andreessen’s prediction has come true. We do now live in a digital world and every company who has at least one customer must be a software company. Every company that wants to survive has a digital presence, connects to customers, their devices and locations in a myriad of ways. Chances are “there’s an app for that.” No matter the industry, companies are interfacing with customers, suppliers, partners and investors with some form of software that brings it all together.

But while digital engagement using software applications is what we see and experience, the data that is generated from every touch of a phone screen, click of a mouse, and swipe of a digital credit card is the protein that powers the industry athletes and separates the olympians from the amateurs.

Software without embedded analytics will starve

Most companies today use that IoT data protein to feed their salesforce, marketing department, security office and finance organization. But the true industry athletes know that consuming the data is a path toward improving software and systems performance and other operations, which is the real key to winning the gold medal. Feeding real-time data to product management, software development and customer support is a key element of the training that makes improvements and enhancements possible at a speed that post-experience customer surveys cannot deliver. As more and more enterprise software solutions become self-managed services or hosted offerings, predictive maintenance and proactive action is the differentiator between the high school athletes and the Olympians.

This leads me to my own prediction: software without embedded analytics will starve.

Optimal Plus takes home the data olympics gold

One of the data olympians that I admire most is Optimal Plus. Software on the manufacturing shop floor is not new, but traditional manufacturing software does not represent the next generation of embedded analytics that will separate the industry athletes from the rest. The key here is sensor data, data that tracks every component of every machine across a distributed and often complex supply chain, which translates into a lot of data. There is a difference between collecting that data in homegrown repositories or newly established Hadoop clusters versus truly acting on business insights generated from billions of sensor data points in near real time. When you consider this volume of data and pair it with the costs and quality demands in the electronics and semiconductor manufacturing industry segment, you get Optimal Plus.

Optimal Plus is a software company, but it is a software company that lives and breathes on embedded analytics in distributed devices. Responsible for delivering the manufacturing intelligence necessary to produce 50 billion semiconductors and printed circuit boards each year, Optimal Plus compares historical data with almost-instant test information to predict faults and prevent downtime. And in production environments where errors can — and usually do — negatively impact profit, Optimal Plus delivers instant analytics integrating previously siloed data islands – the result of software that generates data but then doesn’t know what to do with it.

Analyze or be eaten

Software has transformed the world, but without the core protein of data and the user behavior analytics it can provide, the software itself is not enough. Companies that provide software applications and digital experiences without embedded analytics will starve, while the companies who leverage the protein of data to understand each and every customer at the individual click or touch level will consume their competitors. Analyze or be eaten. What do you think of that, Marc Andreesen?

All IoT Agenda network contributors are responsible for the content and accuracy of their posts. Opinions are of the writers and do not necessarily convey the thoughts of IoT Agenda.

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