TLDR; - Software has become a commodity and will be more so. Customers would be looking for finishing outcomes, not just automation of their tasks. Customers would be demanding decision making systems, not just decision support systems. The outcomes will be micro, not tied to traditional SaaS software workflows (dashboards, rules, reporting). Agentic software are best positioned to deliver those surgical outcomes to the customer, can take over the emerging services as software market.
Since building software is not a moat anymore, services firms that are laser focused on customer outcomes have better chances to build the agentic software than the traditional SaaS software companies who are not outcome oriented.
The Evolution of Software, and Service Relationships - Impact of AI Agents
Tools, Services, Outcomes
Historically there has been a clear delineation between tools and services. Tools are there to make efficiency gains and services exist to use the tool to get to outcomes. Tools were simple instruments, fully dependent on human skill to deliver an outcome.
Tools - Enhance Human Ability: The tools existed for enhancing human work. For instance, a plumber uses tools like wrenches and pipe cutters to repair a leaking pipe.
Services - Human Dependency and Outcome Ownership: While these tools are essential, the outcome—the fixed leak—relies entirely on the plumber's skill, experience, and judgment in diagnosing and solving the problem. Importantly, Ownership of the outcome also stayed with the service provider: the plumber was responsible for delivering a satisfactory result, with payment typically made only after the leak was successfully repaired.
ERP Software and Business Process Services (Automated but Human-Guided)
As tools transformed into technology and software - software brought efficiency by handling routine tasks but still required significant human involvement to input data, configure processes, and make decisions. Business process services came about to fill that gap between the software and outcome.
ERP Software automated processes, while services used the software to input data to deliver outcomes
Software - Process Automation: ERP systems automate repetitive processes like inventory management, payroll, and logistics, improving efficiency.
Services - Human Support in Automation: Despite this automation, ERP systems still require human operators to input data, configure workflows, and interpret outputs, making them a tool that enhances efficiency but still relies on human guidance for outcomes. Services took the role of "operating" the software, to make it work. The ownership and pricing structure moved away from outcomes, to SLAs of operating the software.
SaaS Software and Workflow Services
SaaS software marked a shift to enhance human organizational workflows - such sales, HR, and finance. SaaS software primarily collected data, analyzed the data, organized the information and presented the reports and services took on the role of managing those workflows, still not taking full ownership of the final outcomes.
Software - Automate Workflows: SaaS applications like CRM software help organize customer data and track interactions, but sales teams still make decisions on engaging clients and closing deals.
Services - Workflow Management: SaaS improved productivity by streamlining workflows. Services took on the role of workflow management, with humans making some judgment calls on the workflows, to turn workflows into actual outcomes.
Services firms rarely own outcomes, jut SLAs of managing workflows. Customers Are still responsible for outcomes.
SaaS enabled workflows, services took over managing the workflows, still not owning customer outcomes.
SaaS enabled workflows, services took over managing the workflows, still not owning customer outcomes.
Present and Future: Agentic Software - The Emerging Role of Autonomous, Outcome-Driven Software
Agentic software is not just a new class of software that can not only do traditional software tasks such as automate, enhance or organize workflows, but can autonomously deliver outcomes, the role that services played traditionally. By processing data in real-time, interpreting context, and making decisions, agentic software can deliver outcomes and has the potential to replace many services traditionally delivered by humans.
Agentic software can deliver outcomes, with (almost) zero human involvement
Example: Sales AI agents autonomously engage with prospects, prioritize leads, and take direct actions to move deals forward—outcomes previously achieved by human sales representatives.
Example: Cybersecurity AI agents can not just continuously monitor logs, but can also make judgment calls related to criticality, respond proactively, act as security and compliance evidence asserters, collectors and auditors, fulfilling tasks that used to require human analysts' time and attention.
Autonomy and Responsibility for Outcomes: Agentic software doesn't just facilitate work; it actively assumes responsibility for delivering results. By interpreting data and taking action without constant human oversight, this software transforms service delivery, turning traditional human-based services into fully autonomous, outcome-oriented solutions.
Agentic software stack is not complicated, and will be further commoditized by AI itself, where writing a micro agent for a specific outcome will be trivial. In that world whoever can understand those outcomes can deliver that agent effectively. Traditional SaaS companies are so workflow (here is a dashboard, download a report ..) that it will be hard for that mindset to understand the use cases and delivery of agentic software. It will be an easy punt for outcome oriented services companies to write agentic software for that outcome.
