Programmer Productivity and Economic Rewards
In the last few months it has come to my attention that programmers can improve their productivity by astronomical percentage gains. I will follow in another article how these gains and what gains can come about. It follows then that the following conjectures may well be in-line (note these are conjectures and assumptions not proven facts)
If Software is one of the major areas where productivity gains can be astronomical as opposed to other careers, then the potential there is for unlimited monetary gains. Software may be one of the few areas where economic profits are possible long-term. Economic profits typically become zero due to competition. But, even in a competitive market, if productivity can be improved long-term, then long-term economic profits are still possible… The potential then for software as an incredible money making machine is there – even with competition. This is of course, only if productivity gains continue to outpace competition's lost margin.
Please comment and correct, I appreciate the debate!
Thank you,
Darshan Arney
If Software is one of the major areas where productivity gains can be astronomical as opposed to other careers, then the potential there is for unlimited monetary gains. Software may be one of the few areas where economic profits are possible long-term. Economic profits typically become zero due to competition. But, even in a competitive market, if productivity can be improved long-term, then long-term economic profits are still possible… The potential then for software as an incredible money making machine is there – even with competition. This is of course, only if productivity gains continue to outpace competition's lost margin.
Please comment and correct, I appreciate the debate!
Thank you,
Darshan Arney
posted by Shawn Arney at 10:46 PM
1 Comments:
Chris brings up two main points of conflict:
How do we improve productivity, especially if everything changes constantly?
How do we profit from productivity improvements in a big way?
As to the profit motive, I should be clearer about economic profits. Economic profits is Sales Revenue subtracted from normal costs and economic opportunity costs. Economic Opportunity costs being those resources that could have been reallocated elsewhere... in other ventures or opportunities.
I did make a jump I admit by claiming a software was an incredible money making machine! But, I still believe it has the potential for long-term economic profits.
What is the point of economic profits? Well, the point is that software is in the long-term, the best place for allocating your resources as your economic profits will not be competed away.
Productivity is the key to unlocking long-term economic profits even with fierce competition (which normally brings economic profits down to zero..)
Productivity in software on the other hand, has unlimited potential for improvement.
Productivity enhancement through improving the software developer has much room for growth as well.
I see Chris' point though, it looks like a dream not tied to reality...
The next article will address productivity claims
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