The Value of Corporate Software

Software is now a vital element in a variety of business processes. It is also a vital component of both services and products. It is often at the core of business models and can be seen as an important differentiation. It is a key driver of innovation and productivity, and an important part of the digital transformation process across all industries. This is why software has become an essential part of IT and business classes even for non-technical students.

The 1980s saw the advent of computer programs that revolutionized business. One of the most famous examples was word processing software, such as Word Perfect and Microsoft Word that quickly replaced IBM typewriters. Mathematical spreadsheet software such as Lotus 1-2-3 and Excel became popular too. In the 1990s, globalization brought further changes as businesses began to use SAP software to coordinate supply-chain vendors. These programs were utilized in logistics and manufacturing to reduce the time spent on operations.

Companies that are considering implementing software should consider how to evaluate this intangible asset. The process of valuing software is complicated, whether it’s to determine the purchase price or financing cost, or to figure out the best way to influence the value of flow over the life of the product. For this reason, the IT team and the managers of business units must be focused on maximizing the value of investments in software. Upper management should empower and support them to take informed decisions that positively impact the flow value in their organization.

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