Unlike some other reproductions of classic texts (1) We have not used OCR(Optical Character Recognition), as this leads to bad quality books with introduced typos. (2) In books where there are images such as portraits, maps, sketches etc We have endeavoured to keep the quality of these images, so they represent accurately the original artefact. Although occasionally there may be certain imperfections with these old texts, we feel they deserve to be made available for future generations to enjoy.

Unlike some other reproductions of classic texts (1) We have not used OCR(Optical Character Recognition), as this leads to bad quality books with introduced typos. (2) In books where there are images such as portraits, maps, sketches etc We have endeavoured to keep the quality of these images, so they represent accurately the original artefact. Although occasionally there may be certain imperfections with these old texts, we feel they deserve to be made available for future generations to enjoy.

This book contains the refereed proceedings of the Third International Conference on Software Business (ICSOB) held in Cambridge, MA, USA, in June 2012. The software business refers to commercial activities in the software industry, aimed at generating revenues from the design, delivery, and maintenance of software products and IT services to enterprises and individual customers, as well as from digital content. Although this business shares common features with other knowledge-intensive markets, it carries many inherent features making it a challenging domain for research. The 20 full and 10 short papers accepted for ICSOB were selected from 60 submissions and are organized in sections on software product management, organizational transformation, industry transformation, software platforms and ecosystems, and emerging trends.

A trio of experts on high-tech business strategy and innovation reveal the principles that have made platform businesses the most valuable firms in the world and the first trillion-dollar companies. Managers and entrepreneurs in the digital era must learn to live in two worlds-the conventional economy and the platform economy. Platforms that operate for business purposes usually exist at the level of an industry or ecosystem, bringing together individuals and organizations so they can innovate and interact in ways not otherwise possible. Platforms create economic value far beyond what we see in conventional companies. The Business of Platforms is an invaluable, in-depth look at platform strategy and digital innovation. Cusumano, Gawer, and Yoffie address how a small number of companies have come to exert extraordinary influence over every dimension of our personal, professional, and political lives. They explain how these new entities differ from the powerful corporations of the past. They also question whether there are limits to the market dominance and expansion of these digital juggernauts. Finally, they discuss the role governments should play in rethinking data privacy laws, antitrust, and other regulations that could reign in abuses from these powerful businesses. Their goal is to help managers and entrepreneurs build platform businesses that can stand the test of time and win their share of battles with both digital and conventional competitors. As experts who have studied and worked with these firms for some thirty years, this book is the most authoritative and timely investigation yet of the powerful economic and technological forces that make platform businesses, from Amazon and Apple to Microsoft, Facebook, and Google-all dominant players in shaping the global economy, the future of work, and the political world we now face.

As we continue in an era of simultaneous innovation and commoditization, enabled by digital technologies, managers around the world are asking themselves "how can we both adapt to rapid changes in technology and markets, and still make enough money to survive--and thrive?"
To provide answers to these important and urgent questions, MIT Sloan School of Management Professor Michael Cusumano draws on nearly 30 years of research into the practices of global corporations that have been acknowledged leaders and benchmark setters--including Apple, Intel, Google, Microsoft, Toyota, Sony, Panasonic, and others in a range of high-technology, services, and manufacturing industries. These companies have also encountered major challenges in their businesses or disruptions to their core technologies.
If we look deeply enough, he contends, we can see the ideas that underpin the management practices that make for great companies, and drive their strategic evolution and innovation capabilities.
From his deep knowledge of these organizations, Cusumano distills six enduring principles that he believes have been--in various combinations--crucial to their strategy, innovation management practices, and ability to deal with change and uncertainty.
The first two principles--platforms (not just products), and services (especially for product firms)--are relatively new and broader ways of thinking about strategy and business models, based on Cusumano's latest research. The other four--capabilities (not just strategy or positioning), the "pull" concept (not just push), economies of scope (not just scale), and flexibility (not just efficiency)--all contribute to agility, which is a mix of flexibility and speed. Many practices associated with these ideas, such as dynamic capabilities, just-in-time production, iterative or prototype-driven product development, flexible design and manufacturing, modular architectures, and component reuse, are now commonly regarded as standard best practices.
These six enduring principles are essential in a new world dominated by platforms and technology-enabled services.

As we move into an era of simultaneous innovation and commoditization, enabled by digital technologies, managers around the world are asking themselves "how can we both adapt to rapid changes in technology and markets, and still make enough money to survive - and thrive?" To provide answers to these important and urgent questions, MIT Sloan School of Management Professor Michael Cusumano draws on nearly 30 years of research into the practices of global corporations that have been acknowledged leaders and benchmark setters - and Microsoft, Apple, Intel, Google, and others in software, internet services, and consumer electronics, and Toyota in manufacturing. If we look deeply enough, he contends, we can see the ideas that underpin the management practices that make for great companies, and drive their strategic evolution and innovation capabilities. From his deep knowledge of these organizations, Cusumano distils six enduring principles that he believes have been - in various combinations - crucial to their strategy, innovation management practices, and ability to deal with change and uncertainty. The first two principles - platforms (not just products), and services, for product firms - are relatively new and broader ways of thinking about strategy and business models, based on Cusumano's latest research. The other four - capabilities (not just strategy), the "pull" concept, economies of scope, and flexibility (not just efficiency) - all contribute to agility, which is a mix of flexibility and speed. Some practices associated with these ideas, such as dynamic capabilities, just-in-time production, iterative or prototype-driven product development, flexible design and manufacturing, modular architectures, and component reuse, are now commonly regarded as standard best practices. They are also essential to a new world dominated by platforms and technology-enabled services.

Though Japan has successfully competed with U.S. companies in the manufacturing and marketing of computer hardware, it has been less successful in developing computer programs. This book contains the first detailed analysis of how Japanese firms have tried to redress this imbalance by applying their skills in engineering and production management to software development. Cusumano focuses on the creation of "software factories" in which large numbers of people are engaged in developing software in cooperative ways--i.e. individual programs are not developed in isolation but rather utilize portions of other programs already developed whenever possible, and then yield usable portions for other programs being written. Devoting chapters to working methods at System Developing Corp., Hitachi, Toshiba, NEC, and Fujitsu, and including a comparison of Japanese and U.S. software factories, Cusumano's book will be important reading for all people involved in software and computer technology, as well as those interested in Japanese business and corporate culture.

The advancementof the softwareindustry has hada substantialimpact notonly onproductivityandonGDPgrowthglobally, butalsoonourdailyworkandlife. Software business refers to commercial activity of the software industry, aimed at generating income from delivery of software products and software services. Although software business shares common features with other international knowledge-intensive businesses, it carries many inherent features making it an intriguing and challenging domain for research. Until now, however, software business has received little attention from the academic community. The First International Conference on Software Business (ICSOB 2010) was organized in Jyv] askyl] a during June 21-23, 2010. This inaugural conference brought together a strong Program Committee of 52 members with research disciplines from various ?elds of business management and technology mana- mentaswellasinternational?avorwithmemberscomingfrom17countriesfrom South and North America to Europe, India and Australia. Wereceived35researchpapersubmissions.Thepaperswentthroughadoub- blind review process producing at least three reviews for each accepted paper. The ProgramCommittee accepted 13 submissions to be presented as full papers in the conference, equaling 37% of the submissions. In addition, ten papers were accepted as short papers. The accepted papers represent the wide variety of - searchactivityonsoftwarebusiness.Forthepurposesoftheconferenceprogram, the papers were organized under eight themes: business models, business m- agement, ecosystems, education and research, internationalization, open source software and social media, product management, and software as a service. In addition to the paper sessions, the conference program included three keynote presentations and a Business Innovation Track containing best-practice presentations from the software industry. The conference program also included two workshops, three tutorials and an adjunct meeting of the Cloud Software Consortia."