Science: Firms that can't live with a creative spirit: Why do software companies so often crash, even if their programs don't? The problem is key personnel, explains Mike James

Software companies are the most fascinating of commercial ventures. You can start one with next to nothing in your pocket and it can grow into a world-class multimillion profit-earning organisation in next to no time. Yet strangely many of these rising stars fall back to earth with a bump for no apparent reason. Why does the magic so often go out of the enterprise? Why does a company crash even if its programs don't?

The romance of software is captured by the lonely figure of an enthusiastic programmer working long, unpaid hours and weekends. When other people are taking holidays he's hard at it, creating a masterpiece.

The truth is only a little removed from this stereotype. Bill Gates and Paul Allen started Microsoft by creating Basic, using their school's computer. WordPerfect was an academic exercise for Alan Ashton. Gordon Eubanks wrote CBasic as a graduate project and founded a company that went on to become Symantec. Dennis Ritchie and Kenneth Thompson wrote the Unix operating system in their spare time.

If you look more closely at these stories, what you find is more like the saga of artistic creation than technology. You almost expect damp garrets and consumption rather than clean computers and cola.

Once the programmer has completed the strenuous exercise of creating his master work, production costs are negligible. For pennies, you can mass-produce a program that will sell for hundreds of pounds.

Such success brings the need to grow at a rate unmatched by any other industry. Overnight the programmer has to find managers and a corporate structure. The new management usually succeeds in sidelining the programmers involved in creating the product. The product is there - who needs them? In the software business it is vital that the future is not linked to just one individual.

The company may start new programming projects to ensure its future prosperity. These will be team efforts managed by committee. Slowly the programming teams manage to gain control of the original product and the new products they are working on.

A program is a very personal thing and it takes time to understand something that another programmer has created. Indeed programming as an activity is a very personal thing and it takes time for a team to know each other well enough to work together effectively.

But again the product has become dependent on particular personalities. The company finds the closeness of the programming team to their product as threatening as the single programmer. Can you imagine a company tolerating a production line which contained irreplaceable manual workers? Imagine the bargaining power that confers on the key personnel - 'double my wages or I'll close you down by leaving.'

For a company to operate as an entity separate from its workforce it is vital that it eliminates such key personnel. By moving people around the company thinks it can avoid creating critical personnel. What it actually does is destroy the intimate relationship between programmer and program essential to its continued development.

IBM, for example, brings together program teams and disperses them as required. One can only infer what effect this has on any piece of software.

Perhaps the best known and most disastrous tale of missing programmers is the case of the bestselling WordStar. This was the number one word processor in the days before MS-DOS. If things had gone according to plan, it would have been a simple matter to create an MS-DOS version of WordStar - but they had lost their key programmers. .

By some miracle they managed to create a usable product and were granted a breathing space. But then they decided to write a new version from scratch - WordStar 2000. This simply opened the door to their confident rival, WordPerfect, and the company's market share never stopped declining thereafter.

If software companies are to succeed in the long term, some mechanism has to be found of retaining key personnel without letting them know just how essential they are.

Life and Style

The Magna Carta
archaeologyContemporary account of historic signing discovered
Jeremy Paxman has admitted he is a 'one-nation Tory' and complained that Newsnight is made by idealistic '13-year-olds' who foolishly think they can 'change the world'.
peopleFormer Newsnight presenter is being touted for a brand new role
The two-year-old said she cut off her fringe because it was getting in her eyes

Video: It is the type of thing no parent wants to hear

Arts and Entertainment
Avatar grossed $2.8bn at the box office after its release in 2009
ebooksNow available in paperback
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Opilio Recruitment: Business Development Manager

Competitive: Opilio Recruitment: An exciting opportunity has arisen for a Bu...

Recruitment Genius: Systems / Network Administrator

£35000 - £37000 per annum: Recruitment Genius: This award winning internet, do...

Recruitment Genius: Marketing Assistant

Negotiable: Recruitment Genius: This is an excellent opportunity for someone l...

Opilio Recruitment: Technical Recruiter

£35k - 42k per year + benefits: Opilio Recruitment: We have an exciting oppo...

Day In a Page

Homeless Veterans Christmas Appeal: ‘We give them hope. They come to us when no one else can help’

Christmas Appeal

Meet the charity giving homeless veterans hope – and who they turn to when no one else can help
Should doctors and patients learn to plan humane, happier endings rather than trying to prolong life?

Is it always right to try to prolong life?

Most of us would prefer to die in our own beds, with our families beside us. But, as a GP, Margaret McCartney sees too many end their days in a medicalised battle
Thomas Cook's outgoing boss Harriet Green got by on four hours sleep a night - is that what it takes for women to get to the top?

What does it take for women to get to the top?

Thomas Cook's outgoing boss Harriet Green got by on four hours sleep a night and told women they had to do more if they wanted to get on
Christmas jumper craze: Inside the UK factory behind this year's multicultural must-have

Knitting pretty: British Christmas Jumpers

Simmy Richman visits Jack Masters, the company behind this year's multicultural must-have
French chefs have launched a campaign to end violence in kitchens - should British restaurants follow suit?

French chefs campaign against bullying

A group of top chefs signed a manifesto against violence in kitchens following the sacking of a chef at a Paris restaurant for scalding his kitchen assistant with a white-hot spoon
Radio 4 to broadcast 10-hour War and Peace on New Year's Day as Controller warns of cuts

Just what you need on a New Year hangover...

Radio 4 to broadcast 10-hour adaptation of War and Peace on first day of 2015
Cuba set to stage its first US musical in 50 years

Cuba to stage first US musical in 50 years

Claire Allfree finds out if the new production of Rent will hit the right note in Havana
Christmas 2014: 10 best educational toys

Learn and play: 10 best educational toys

Of course you want them to have fun, but even better if they can learn at the same time
Paul Scholes column: I like Brendan Rodgers as a manager but Liverpool seem to be going backwards not forwards this season

Paul Scholes column

I like Brendan Rodgers as a manager but Liverpool seem to be going backwards not forwards this season
Lewis Moody column: Stuart Lancaster has made all the right calls – now England must deliver

Lewis Moody: Lancaster has made all the right calls – now England must deliver

So what must the red-rose do differently? They have to take the points on offer 
Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

It's in all our interests to look after servicemen and women who fall on hard times, say party leaders
Millionaire Sol Campbell wades into wealthy backlash against Labour's mansion tax

Sol Campbell cries foul at Labour's mansion tax

The former England defender joins Myleene Klass, Griff Rhys Jones and Melvyn Bragg in criticising proposals
Nicolas Sarkozy returns: The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?

Sarkozy returns

The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?
Is the criticism of Ed Miliband a coded form of anti-Semitism?

Is the criticism of Miliband anti-Semitic?

Attacks on the Labour leader have coalesced around a sense that he is different, weird, a man apart. But is the criticism more sinister?
Ouija boards are the must-have gift this Christmas, fuelled by a schlock horror film

Ouija boards are the must-have festive gift

Simon Usborne explores the appeal - and mysteries - of a century-old parlour game