Kirk Evans Blog

.NET From a Markup Perspective

The ROI of Software Made Simple

Josh Holmes has a great post about going the the mattresses to prove ROI for your application.  His post, “Moving From Cost center to Strategic Partner”, is well-written and is dead on the money.

During my interview process at Microsoft, my interviews focused predominantly on two themes: how do you increase revenue or decrease cost through software?  That has stuck with me for the past few years.

While I am talking to developers about software, I remember that interview day from hell and focus on topics that save developers time and effort.  After all, the ROI for learning and using a technology to a developer is the value of being able to go home and not get paged about their app crashing in the middle of the night.  When I am speaking to management or executives, I focus on increased revenue opportunities and decreased cost overhead. 

The companies I talk to are typically media and entertainment companies (increase revenue) or telcos (decrease cost).  On the increased revenue side, I have worked with companies like AOL to help increase their advertisement capabilities through new offerings.  On the decreased cost side, I have worked with the major telcos to implement line of business applications like call center software.  In either case, the benefits are measurable.  If your code increases productivity, then measure it.  If your code decreases cost to the company, then measure it.  If your code reduces the amount of time that a CSR is on the phone, decreases the number of calls that require a CSR, decreases corporate headcount… measure that.  If your code just made the company a bajillion dollars and only took a hundred thousand to build, measure it and print posters all around corporate headquarters to remind them of it.

In the end, running IT should be like running a business.  Your goal is to expand the company and have revenue growth outpace expenditures.  You should increase revenue and decrease cost.  That’s the power of software, and that’s our jobs as technologists: help companies find new revenue streams or decrease existing overhead.  In today’s economy, many companies are focused on decreasing costs… which doesn’t have to mean a work stoppage for developers. Instead, this is a huge opportunity to show companies how IT matters and how to decrease their cost through investment in software.

Kudos, Josh, for a great article.