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Why software factories are back – and how they work in the age of AI

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August 12, 2026
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softwarefactorygettyimages-1421511848

Andriy Onufriyenko/ Second by way of Getty Pictures

Comply with ZDNET: Add us as a preferred source on Google.


ZDNET’s key takeaways

  • Software program factories will put together prototypes for vast distribution. 
  • Main AI firms are creating the foundations.
  • The specter of day by day releases and updates calls for larger automation. 

Tune into the TV present Shark Tank, and probably the most recurring query you hear voiced by the enterprise capitalists to budding entrepreneurs is whether or not they have preparations with a manufacturing unit to cost-effectively mass-produce their pooper-scoopers, consolation socks, or scrub pads. The thought of a mass-production facility might make sense for software program supply as nicely.

Think about submitting your prototype — resembling a vibe-coded preliminary model of an app — to a service that may mass-produce your resolution in a repeatable, automated vogue for supply to a large viewers. Such is the promise of the “software program manufacturing unit.”  

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There’s nothing new in regards to the idea — it was all the excitement about twenty years again as extra software program growth turned componentized and repeatable. Microsoft was talking about software program factories again in 2008. The thought light for some time, however now it is again, fueled by the fast manufacturing of software program code generated and managed by synthetic intelligence.

Till just lately, even with automation and DevOps practices, “coding created the bottlenecks for lots of organizations,” Moritz Plassnig, CEO of CloudBees, instructed ZDNET. “You needed to rent extra engineers, but it surely was very onerous and expensive to rent them.” 

At the moment’s software program manufacturing unit is constructed on AI fashions

Because of the coding capabilities of basis AI fashions and related brokers, the idea of the software program manufacturing unit has been revived — with the automation of the software program growth lifecycle into repeatable chunks receiving critical consideration. With agentic coding, “we’re much less constrained on the coding facet,” Plassnig stated. It may well additionally elevate the roles of IT professionals. “Developer craftsmanship shouldn’t be going away, as devs and engineers shift from writing code to exercising judgment round what will get constructed and shipped.”

At the moment’s software program manufacturing unit idea is constructed across the AI fashions now in the marketplace — and the idea is nearly the identical throughout all of the fashions. “Over the previous 18 months or so, most of the firms which can be on the slicing fringe of utilizing brokers to automate their software program growth life cycle have been constructing the identical machine, and independently coming to the identical conclusion on what this machine seems to be like,” in response to Jaymin West, a forward-deployed engineer and expertise evangelist, in a latest YouTube video. 

Additionally: ‘I’m not a programmer’ anymore: Linus Torvalds on the only two tools he uses now

The businesses constructing out software program factories embody the luminaries of at this time’s agentic financial system: Anthropic, Cognition, Cursor,  Manufacturing facility, Google, Github, OpenAI, and Ramp. “Each single considered one of these firms has converged on the identical form,” West identified. “It is actually vital at this level to understand that these are the businesses on the innovative and there’s a clear sample forming on how they’re structuring their total engineering framework.”  

(Disclosure: Ziff Davis, ZDNET’s guardian firm, filed an April 2025 lawsuit in opposition to OpenAI, alleging it infringed Ziff Davis copyrights in coaching and working its AI programs.)

The software program manufacturing unit serves as a option to shortly act on concepts, Plassnig illustrated. “For example anyone works in a buyer assist position, they usually have an fascinating concept based mostly on all of the suggestions they hear from clients. Like a automotive manufacturing unit, you’ve a prototype that is experimental. However then you’ve a manufacturing unit that produces the automobiles at scale. Likewise, that individual with the software program concept can submit it to the manufacturing unit and the primary iteration of that will get created. Then the product, engineering and IT professionals have a look. Then the manufacturing unit can take it once more and make it.”

Additionally: ‘AI is an enormous tailwind for software companies’: 5 tips for adapting to the new ‘SaS’ model

The software program manufacturing unit helps tackle the problem of validating and sustaining a whole lot of hundreds of traces of code, together with the software program releases, updates, and refreshes that now happen each day at many organizations.

“We are going to get to the purpose the place as people [we] cannot validate what’s working and what’s not likely working anymore,” Plassnig stated. “You wish to know if software program is definitely working, if there aren’t any bugs, if there’s not an error fee that is spiking. Or possibly it is working, however is the agent’s reminiscence utilization larger than you need? At the moment, you’ve people all these alerts, however then in case you have 100 occasions extra adjustments, like each couple of minutes, it breaks.” 

What does a software program manufacturing unit seem like? 

A typical software program manufacturing unit, as supported by the inspiration fashions, is made up of six elements, West outlined:

  1. Queue: “Work arrives as a problem, not a immediate.”
  2. Management airplane: “A sturdy floor, not a laptop computer.”
  3. Sandbox: “One per activity. Destroyed after.”
  4. Pull request: “The output unit. Retrieved by a human.”
  5. Occasion stream: “Watch each motion. Kill it with out destroying the run.”
  6. Sturdy reminiscence: “The sandbox does each run. What shouldn’t be written to a file doesn’t survive.”

In fact, software program factories, regardless of how environment friendly, aren’t a panacea for good software program practices. 

Additionally: AI failed to properly patch software flaws 74% of the time, 1Password’s study warns

“It is no secret now that code technology is extremely simple,” stated West. “It is extremely low cost. Verification has turn into the blocker for lots of those firms. Ensuring that brokers write code may be very simple. However ensuring that that code is appropriate remains to be a serious engineering downside. And it is vital to debate why constructing a software program manufacturing unit doesn’t suggest you are simply excusing verification or degrading the standard of your codebase.” 





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