The past few years have been tough for software developers working for in-house IT departments.

If they haven’t been outsourced then they have probably been rationalised, consolidated, offshored, downsized, upskilled or whatever other human resources buzzword describes their diminishing career prospects.

Where once programming was seen as a secure job with the potential for moving into lucrative freelance contractor roles, low-cost and high-quality competition from India has caused many firms to question the value for money of the development team.

Since the growth in demand for dealing with the Millennium Bug, and the rush to take on workers with web skills during the dot com boom, pay rates have been static at best, and in many cases have dropped.

It is no surprise that vendors offering outsourced application software services were among the few beneficiaries during the post-2000 crash.

But as our Future of Software Development special report this week suggests, things may be looking up.

As the lines between business and IT become increasingly blurred, new techniques such as service-oriented architecture (SOA) place software developers at the heart of delivering business strategy.

As the major packaged software suppliers make their products SOA-conformant, the need for programmers with knowledge of their employer’s unique business environment becomes critical. The future packaged software user will use SOA methods to develop bolt-on functionality that turns an SAP or Oracle supply chain system into a business-specific competitive tool.

Many of the ‘commoditised’ skills, such as basic code-cutting, will be completed overseas. But this will only increase the need for in-house experts who can bridge the gap between software development knowledge and business awareness.

Software development is going through one of the biggest transformations in its relatively short history. The result will place the skills of the business-focused software expert at the centre of a company’s success.