Thirty-Five Years Ago
Some essays begin with an idea. This one begins with a memory.
While gathering my thoughts for this series, an old book surfaced from thirty-five years back: Michael Cusumano’s Japan’s Software Factories: A Challenge to U.S. Management, published in 1991. Japan had just spent two decades stunning the world in automobiles, machine tools, semiconductors and computer hardware — winning not on cheap labour but on production systems that delivered quality, variety and relentless improvement at once. Cusumano documented what happened when Hitachi, Toshiba, NEC and Fujitsu turned that same industrial ambition on code itself: the deliberate evolution, as he put it, from “craft to factory modes of software production.”
The factories rested on three pillars. Modules were designed for reuse across projects, so programs were not built from scratch. Development followed strict, standardised phases rather than individual heroics. And statistical quality control — the discipline of the Toyota line — was applied to defects, producing failure rates American software houses could not approach. Treat code as manufacture, the thesis ran, and software would yield to industry the way cars had.
The book found me at a susceptible moment. In mid-1992 I returned to India to begin my entrepreneurial journey, carrying the dream of building software products from India. I tried a multimedia database. I tried an image-processing workbench. Both failed. And with them, quietly, died my dream of building a software factory from India.
But the phrase never left me. Software factory. Every few years it resurfaces and asks the same two questions: how do you industrialise the creation of software — and what would it take for India to build such factories?
For over three decades, the honest answer to the first question was: you cannot, not fully. The Japanese factories succeeded at exactly what they controlled — process, reuse, quality — and still did not conquer software, because everything they industrialised was arranged around the programmer, while the programmer remained the unit of production. Process discipline could polish the craft. It could not replace the craftsman. Japan proved the ambition was right and the technology was missing.
Thirty-five years later, the missing piece has arrived. This essay is that old idea, returned — with the one thing it always lacked.
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Here is the strange thing about the industry Cusumano was studying. Software went on to industrialise everyone else — factories, supply chains, finance, commerce — but its own creation remained artisanal, exactly as he found it. It is still made by teams of highly skilled people working for months or years to turn requirements into designs, designs into code, code into tested products, and products into reliable services. The cloud transformed how software was distributed. It did not transform how software was created.
Artificial intelligence is beginning to do exactly that — and the result could be the third great affordability revolution of the modern era. China transformed the economics of physical products. India transformed the economics of technology services. AI can now transform the economics of the finished software product itself.
The vehicle will be the software foundry — Cusumano’s factory, rebuilt around the ingredient it never had: a production system that uses AI not simply to help programmers write code faster, but to manufacture focused, reliable, affordable software products, repeatedly. Its promise is not every feature for every possible customer. Its promise is more useful than that: identify the 10–20% of features that carry 80–90% of the customer’s utility — and deliver that utility at 10–20% of today’s price.
This is not merely cheaper software. It is the beginning of software abundance.
