Reason Software House Failed? Why most of software houses failed

Spread the love

Reason Software House Failed?

Long Article: Reason Software houses failed.

Reason Software

Why most of new software houses are doomed within few months?


All software engineers when were asked in classes from their teachers that what they want to do after studies, 80% of the students always replied that they want to start a software house right after their BS or MS, or may be taking an experience of few months but they will eventually start a software house.

Students replied answers

Students replied answers

But well neither 80% of those students ever starts a software house and few of those who does start a software house, around 90% of them are doomed. What’s the reason software house failed? Aren’t they good programmers or aren’t they good in skills?



You will be amazed to know that it’s not the right answer. Most of them are very good in skills and programming language. But for sure an office can’t be run by an individual. Most of the software house, especially new software houses are doomed because of the reason that they want a bigger share of their earning into their pockets, that’s what cause them a total disaster.

Like how??

Because every company does hold a big share of their earning, Right??

Yes that’s absolutely right and it’s on company benefits too, to hold ROI because they had invested a lot.

My Experience?

I worked in software house when I was completing my 7th semester in BSSE. That wasn’t really good in getting projects and I will say that I learned nothing in there as well. For sure it doesn’t mean that I wasn’t a creative student or having a creative mind but there were many reasons that became the symptoms of me “achieving nothing in there “.

But well let’s come to the actual problem.

The actual problem is that most of new software house does have their first goal to not to invest too much, but to eat a lot, for sure they invest a lot in building the infrastructure of their software house but to be exact they don’t really invest in their resource.


Software House

I won’t say that resources are tables, lamps, chairs – But in fact the actual resource is the person who’s working in there. Every new software house has the major point to not to invest on their actual resource, they try to find internees. I don’t say that hiring internee is a bad option, but hiring internee who doesn’t know anything get you another failure. Software house don’t want to invest and internee doesn’t know anything. So in fact if any new software gets any project luckily, unluckily they don’t have any resource to complete that project so the project goes in failure and result in bad standings. So two or more than two projects when turned to failure, that makes the entire software house doomed.


Who’s an internee?

An internee is a person who’s willing to learn something from an environment where he/she can grow his skills. But a new software doesn’t even has a staff that can make that internee learn something. The software houses should hire internees when they are well developed and are growing more, when they already does have a good amount of staff that’s working on several projects. So they hire the new people who are willing to learn from seniors.

But it’s a sad reality that our software houses does hire internee to get their project completed in free, so they can get 100% of their earning.

Image result for disappointed


So what happens then?

It’s very easily understood able, the internee doesn’t learn anything neither the company gets any benefits. Internee utilize the resource of Office [internet, electricity, food] and eventually the newly created software houses are doomed.


What should be done?

Every new software house must have a good start up strategy, if you can’t invest then you should be working yourself, try to complete your projects yourself or have a team as partners. Either to make partners that are good in financing if you can’t finance, or else make partners who knows how to work. Create a 5 member teams who are skilled that are actually your partners in that software house and work together, that’s the better option. Don’t go for seeking internees and hiring them, because if you can’t invest money on them and you can’t pay them, believe me they will never show interest in your projects as well. Because it’s a common phenomenon that if one ain’t getting benefit from something, then he won’t be burning his fuel to get you on top with his hard work.

Image result for disappointed

So it’s good to invest money or else have a skilled partners. Don’t look for cheap ways to hire internees because you won’t want to pay them.

Image result for invest money


So, if a new build software house can invest a lot of money on its resource or else have a quality staff in the shape of partners, they will surely grow.. But wait.!
I will still think about it before saying YES.


Image result for Big No
But well No, this is not everything that makes a new software house free of risks. According to a lot of surveys there
are many other factors that are also present when a software house is decreasing in value and I will not leave a chance to mention them as well.


Miscalculated Time and Budget Frames

Image result for Miscalculated Time and Budget Frames

 One of the big reason software houses are doomed is Miscalculated Time and Budget Frames. If we move toward clients, you will always see that a client is always eager to get their projects rolled on time, even at few stages the clients have been expecting the modules/projects delivery before the times that’s decided. Thanks to my Boss at NKU Technologies who taught me how to calculate time for a project. Clients are always eager to get their projects completed ASAP, and with their increasing keenness and curiosity software developers and companies agrees on a shorter time-stamped. Developers later find issues in completing the projects on time and as a results programmers are failed to deliver project on time, and eventually result in another failure.


Was it Needed At All?

Image result for Miscalculated Time and Budget Frames

Another reason software houses are doomed is the lack of understanding of project manager to evaluate either what is important and what’s not? In many cases the software project managers aren’t able to figure out that what modules of the software does need more resources and what does need less? The evaluation is based on several parameters and which later leads toward the allocation of resource. Many surveys shows that the managers weren’t able to identify that what is important to the project and need more resource allocated and what isn’t.?

Lack of Communication.!


Image result for Lack of Communication


I would consider this one as the one of the most occurring issue that is present everywhere. In many cases the reason software houses were doomed was due to the lack of communication between developers and managers. Not only that, the lack of communication between developers and the client can also cause this. In many cases the analyst or domain expert, who’s directly connected with the client failed to identify the issues that can occur while the software development. Sometime this lack of communication leads toward the unwanted stuff and developers are unable to provide the exact thing the client asked from the domain analyst/requirement engineer. So this issue can be called as mother of all issues.


No End’s users Involvements.!


Related image

It happens a lot, but this mostly ends with the project failure. According to me this can also be included to the reason software houses are doomed. In most cases where the client itself isn’t present the software house is doing in house-project, they are failed to figure it out that if their project does need the end users involvement or not. In few cases the demos of software’s are released but in many cases for privacy they aren’t. So when the project is completed and is released in the market, the end user doesn’t really feel that they need to be engaged to the software, that could be either the technology is unwanted to may be it is not fulfilling the solution.
No involvement of Executive staff.!

No involvement of Executive staff.!

Image result for No involvement of Executive staff
One of the biggest reason software houses are doomed is also the non-involvement of Executive staff. In-active leadership can also cause the developers create some rubbish out of big projects, I count this as a sub-branch of LACK OF COMMUNICATION. Leadership must be involved for regular reviews and guidelines, so the developers stays focused toward what they are in to achieve.
Last but not least, I would count this one as the biggest reason software houses are doomed?

Lack of Quality Testing!

Related image
Another reason software houses are doomed is lack of quality testing of their projects. I must say that this is another factor the projects are failed but in fact I count a project failure as a Software house failure. Lack of quality testing is the big issues many big projects faced. History is filled of the examples where the quality testing wasn’t ensured and billion of dollars were lost just because of poor quality testing.!

I have taken most of these images from GOOGLE and they aren’t mine. You can also read my projects, they might help you a little.

I might have missed a lot in this article, but you can ask me your questions as well. I will be happy to reply them.

Leave a Reply

Your email address will not be published. Required fields are marked *