The Hard Truth About Moving From Hardware to Software

Everyone in industrial tech is “on a journey to become a software company.” But when you listen to the people inside, you hear a different story:

“Different development cycles make transition from HW-linked SW to SaaS difficult — including pricing.”
👉 Insight: Hardware moves in years. Software moves in weeks.

“We moved software people into the IIoT platform, but different hardware have very different requirements and you can’t build a SW platform that is all things to all people.”
👉 Insight: Horizontal ambitions collide with vertical realities.

“Our cloud software sales are constrained and limited by our hardware-driven channel.”
👉 Insight: Traditional channels are built to sell boxes — not subscriptions.

“Buyers are balking at software purchases unless the software clearly unlocks new capabilities.”
👉 Insight: Without clear value, software is just another line item.

“Software is eating into our services revenues, and there is no customer share-of-wallet discussion.”
👉 Insight: Software success requires portfolio discipline — not silos.

“Industrial SW is tied to controls, and rip-and-replace is hard. Go after new markets for new customers.”
👉 Insight: Don’t fight inertia - go where none exists.

“You need to understand product, but in the industrial world the role of the CPO is not recognized — everything goes through the CTO.”
👉 Insight: Without a CPI, software remains bespoke engineering, not a consumable product.


Transitioning from hardware-enabled software to software-defined hardware is less about code — and more about culture, channel, and control.

The industrial companies that succeed are those that give software real organizational power: autonomy, budget, and a direct line to the customer.

Everyone else is still trying to retrofit software into a hardware-first machine.

This post was first published on LinkedIn in November 2025.