It's worth thinking about how companies become #1 in their respective industries. A local restaurant becomes #1 by having the best food and/or location, and pr

It's worth thinking about how companies become #1 in their respective industries. A local restaurant becomes #1 by having the best food and/or location, and providing it at a price people are willing to pay. A car dealership probably succeeds by having the best prices on cars and the best customer service. Most banks compete on customer service and some amount of product differentiation. Insurance is some combination of customer service, market share, and correctly pricing things. To the extent that better software contributes to these core "capabilities", companies will invest in it. Investment means it gets management attention, willingness to spend, willingness to hire annoying top-shelf talent that demands flexible working arrangements and huge salaries. Many -- maybe most -- business don't have competitive dynamics that software enhances. A hotel is a great example: it's location, price, service, and cost control. The software they use at the front desk has approximately zero importance to whether the place will stay in business, or fold. Owners are right to invest as little as possible in it and move on to something more important, like building a brand.