So you want to be a software company?

A really interesting article looking at the challenge for Large Established Organizations (LEOs) wanting to transform to digital business models and software-driven solutions. Spoiler alert: It is not as easy as they think.

But while getting software into the core of your business model—or launching entirely new software businesses—might seem an obvious play in the current business environment, that doesn’t mean it will be easy. In reality, there are few successful cases of nonsoftware companies building software businesses (Exhibit 2) and many notable failures, including from otherwise high-performing companies. Of the approximately $500 billion in total global software revenues in the year 2019, nonsoftware natives captured only 20 percent. Nontechnology players, for their part, brought in only 6 percent (Exhibit 3).