Introduction: Shifting the Perception of Software Value

For decades, software in hardware-heavy products — like automobiles or telecom systems — was mostly considered a cost factor. The legacy mindset treated the software as an essential add-on with minimal value perception. However, in today’s highly competitive environment, software has become the key element of innovation, differentiation, and competitive advantage. As hardware continues to be increasingly standardised, the growing importance of software in product offerings is essential for sustained growth and market relevance

This shift in software value consideration is addressed by the Software Value Map (SVM) developed by Mahvish Khurum, Tony Gorschek, and Magnus Wilson which provides a single framework with multiple perspectives where software value is concerned. The SVM offers insight into the software value so that organisations can make informed decisions which will balance short-term gains and strategic benefits in the long term.

Why the Software Value Map (SVM) Matters

Most existing research and industry practices focus on limited value constructs such as cost or usability. This narrow view leaves a fragmented understanding of software value. The SVM fills this gap by providing a holistic view that includes:

💰 Financial: Revenue, shareholder value, and cost efficiency.

🤝 Customer Perspective: User experience, perceived value and customer lifetime value.

🏭 Internal Business Processes: Value in production, architecture choices, Process efficiency.

🚀 Innovation and Learning: Knowledge assets, tech capabilities, and market potential.

With these viewpoints combined, the SVM enables decision-makers to experience the true worth of software and prevent neglecting critical aspects in product development and management.

The Structure of the Software Value Map

The overarching structure of the SVM consists of four primary perspectives, which are then broken down into Value Aspects (VAs), Sub-Value Aspects (SVAs), and Value Components (VCs). This multilevel organisation allows you to analyse the value of software at a very granular level, leading to accurate decision-making.

1️⃣ Financial Perspective

Emphasises the impact of software on the company’s bottom-line performance.

• Key Components: Revenue growth, profit margins, shareholder value, and cost reduction.

2️⃣ Customer Perspective

Addresses the value perceived by customers, which directly impacts market performance.

• Key Components: Usability, functionality, reliability, maintainability, and network externalities.

3️⃣ Internal Business Process Perspective

Examines the efficiency and effectiveness of internal processes that create and deliver customer value.

• Key Components: Production value, market requirements value, and architectural value.

4️⃣ Innovation and Learning Perspective

Focuses on the intellectual and technological resources needed for sustainable growth.

• Key Components: Technology valuation, intellectual capital, and market potential.

Interrelationships Within the SVM

An interesting aspect of the SVM is its ability to map interrelationships among the different pieces of value. For example:

• 🏗 Architectural Value & Customer Experience: Poor architectural design can end up compromising usability, reliability, and customer satisfaction.

• 🔄 Innovation & Market Value: The potential value of technology is directly linked to its market adoption and longevity.

Understanding these interdependencies ensures that decisions made in one area do not negatively impact other critical aspects, promoting a balanced and strategic approach to software development.

Industrial Application of the Software Value Map

The SVM was evaluated through a case study with Ericsson AB, a leader in telecommunications. The industrial validation focused on impact evaluation patterns, tailored for specific decision-making scenarios such as:

The SVM was evaluated in a case study with Ericsson AB, a leader in telecommunication. The industrial validation was centered on patterns of impact evaluation that were designed for context-specific decision-making, namely:

• ⚡ Product Customisation (PC): Evaluating the long-term value impact of customisation requests.

• 🛠 Architectural Decisions: Exploring how architectural changes affect customer satisfaction and long-term maintenance.

The SVM allowed Ericsson to improve decision-making processes, aligning short-term and long-term values. The case study showed the SVM was effective in delivering actionable insights to balance short-term revenue opportunities against long-term sustainable growth strategies.

Key Benefits of the Software Value Map

• 🔍 Holistic Decision Support: Offers a full view of software value from multiple perspectives.

• 📈 Strategic Alignment: Ensures software development decisions align with organisational goals and market needs.

• ⚖ Balance Between Short- and Long-Term Value: Helps organisations balance immediate sales with sustainable innovation.

• 🧭 Guided Decision-Making: Provides structured guidance through impact evaluation patterns, tailored to specific roles and scenarios.

Conclusion: Redefining Software Value for Future Growth

Software Value Map (SVM) is a transformative framework that empowers organisations to rethink how they understand software value. By offering a unified, multi-perspective approach, the SVM ensures that software-intensive products are developed with strategic foresight, operational efficiency, and customer-centric value in mind.

As software gets to be the essential operator of innovation and differentiation, tools like the SVM will be pivotal for organisations looking to navigate complex markets, sustain competitive advantage, and drive long-term growth.