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From Software Engineers to AI-Enabled Business Architects

Some economic sectors, specific industries, and job roles historically went through changes that heavily impacted how things were done previously. These mega-changes pushed these industries and jobs to new paradigms that required people and processes to change dramatically.

With Devin’s new social media announcements, a novel autonomous AI software developer agent created by Cognition AI, questions arise about the changes we should all expect from the software development roles we are used to seeing at enterprises. Rest assured, Devin will not be the only software development agent to be created. Similarly to what we have seen in the last year, we will probably continue to see an acceleration of tools in the software development productivity realm.

I have typically distinguished between types of jobs that require a human rationale for successful execution and the jobs that do not need this human component to be executed successfully. We no longer see elevator operators in buildings. Technology advancements have enabled elevator passengers to select which floor to go to. They do not require physical strength to open or close elevator doors or define the speed at which the elevator needs to move. These individuals are no longer capturing value in the “moving people around vertical spaces” market, and value capture has shifted to the elevator manufacturing companies and folks that install and maintain these systems.

Physical workers, assuming no decision-making criteria is needed for successful job completion, have also been affected by automation. Assembly-line factory workers have been heavily replaced by robots and machines that execute the same work with higher precision (if there are high-volume requirements). The designers, installers, and maintenance companies of these robots capture value.

Knowledge workers are different, though, depending on the level of creativity required and the worker’s flexibility to move upstream to contribute business value differently.

For example, investment bankers, 50 years ago, manually created charts, presentations, memos, and financial models. With the advent of computers and productivity software, some investment bankers adopted these tools faster and better than others. These tools did not decrease the number of hours bankers work per week, nor the value they capture from their knowledge work. There continue to be thousands of bankers working full weeks (to say the least!) and creating and capturing value with the assistance of these tools. More deals are executed faster today than 50 years ago - none of these bankers manually create financial models. Bankers moved up the chain.

Readers will be able to find knowledge work examples negatively impacted by automation (i.e., call center operators replaced by chatbots) and other examples where automation and productivity allow professionals to evolve (there aren’t fewer lawyers today; they have kept pace with generating and keeping value, and they continue to work T&M).

50 years ago, the 100 companies that relied on software to drive their business probably employed directly and indirectly the 10,000 software engineers available (ratio of 100 engineers per company). As more businesses rely on software for their operations (e.g. 10,000,000 or 100,000,000 companies), the ratio of engineers directly and indirectly related to those companies continues to come down to 1:1 or even lower ratios, implying that the work of one engineer has more and more business impact. Software engineering has been moving upstream since the discipline was created. Instagram is a good example of this: the company had 6 engineers out of 13 employees when sold to Facebook and was used by millions of users.

We don’t know exactly how the software development industry will look in 10 or 20 years. Still, there is a high probability that the predominance of niche and more encompassing copilots, development assistants, and full-blown agents will increase. At the same time, businesses continue to transform themselves, conforming to the preferences of their users, customers, employees, and overall stakeholders. This business evolution is primarily driven by digital adoption at all levels (new hardware, software, and services). The demand pace for digital transformation remains high (albeit it may not need a linear headcount growth).

It is relevant for software development professionals to explore and adopt these productivity tools to understand their capabilities further and assess where to use them. There is room for software engineers and technology professionals to continue transforming businesses and helping these businesses grow in their markets. Let’s continue the journey from software engineering to AI-enabled business architecture.

At Alten Capital we invest in technology services companies that impact business transformation. Please reach out to us to explore partnership opportunities.