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Problem #23: "Productivity" in Software driven Knowledge Economies

There are some very crucial problem statements that are popping up with the advent of the knowledge economy - especially with software (and if its not patentable). How do you define productivity? Especially when the underlying economics behind it is the level of asset creation one is involved in. It was easier when you were manufacturing cupcakes and bottles, as that was easy to calculate, but in software there are layers.

My sense, coming from the software engineering field, suggests that we might have to design and develop frameworks that allow us to clearly define core codebase (assets) and incremental and outlier code base (glue/integration code etc). We might have to find a way to also put a dollar figure around it (based on what we are selling) and as a result define what productivity means in this modern day workforce.

The productivity index in most sectors are around 4-5% - that means for every 100$ that is spent on wages, there is 4-5$ value that is created in assets. That itself is low, but my guess is that somehow and somewhere the equation in software engineering might be much farther skewed than that.

Wave 3 of any sector usually focuses on optimization. The first wave of the web was purely experimental. The second wave seemed to have focused on infrastructure. The third wave, will focus on processes and getting the science right.

Why is this a problem? It is, because unless we can quantify productivity, we will continue living in the stone age in terms of how we work and build enterprises of the future.