Demonstrating Value of Software Engineering
To demonstrate their value to the business, software engineering leaders must craft a compelling narrative for stakeholders. Here are two key strategies to achieve this.
Define Business Value
Today’s software engineering leaders are responsible for innovating, developing, and delivering new digital products and experiences that drive business results. However, proving the value of their teams’ efforts can be challenging in an increasingly complex landscape filled with disruption and diverse stakeholder perspectives—including board members, CIOs, business unit leaders, employees, investors, and society at large.
Often, the concept of “value” is vaguely defined, yet software engineering teams need to continually evaluate the impact of their work and identify opportunities for greater value creation. To do this, they must understand:
- The rationale behind their projects
- Whether their deliverables achieve the expected business outcomes
- How to enhance the value of their solutions and actively seek high-value opportunities
To improve value delivery, software engineering leaders can streamline their teams’ approach by:
- Cultivating a shared understanding of business value and guiding teams to focus their efforts on key value drivers through a structured framework
- Encouraging teams to address the fundamental business challenges that impede value creation
- Aligning various roles and teams across the delivery ecosystem with customer value through comprehensive value chains
- Providing insights into how their work influences business value by establishing a framework that links delivery metrics to business outcomes
- Clearly demonstrating how software engineering initiatives support high-priority business objectives
Use business language to build stakeholder buy-in
For software engineering leaders to secure support and investment for their key initiatives, it’s essential to clearly define the business case, translating complex technical concepts into relatable value propositions for a non-technical audience.
Mastering key business terminology is a fundamental yet critical strategy for effectively justifying the business cases for software engineering initiatives. By incorporating this language from the beginning, leaders can enhance communication with business stakeholders, ensure alignment with shared goals, facilitate investment decisions, and improve product roadmaps.
By utilizing these ten essential business terms, software engineering leaders can better substantiate their business cases, increasing the likelihood of obtaining the necessary investments.
Ten priority business terms to incorporate in software engineering business cases and conversations:
- Return on investment (or return on innovation): the anticipated return from an initiative over time.
- Time-to-market: time required to deliver defined products or software to meet business or customer demands.
- Initial and total addressable market size: the initial and total population to which the products or software can appeal.
- Customer engagement: understanding what target customers need and want to drive engagement, utilization and feedback.
- Market differentiation: offering products and software that competitors do not yet offer, and maintaining that position continuously.
- Selling, general and administrative (SG&A) expenses vs. cost of goods sold (COGS): the portion of revenue assigned to the expense of producing the product or service.
- Product funding: dynamic investment pool to fund product or software initiatives, practicing product-centric delivery to meet business demands.
- Total cost of ownership: all costs across the product’s life cycle.
- Adaptive governance: flexibly delivering required business outcomes and balancing exploration and business-as-usual needs.
- Go-to-market: planning, communication and execution to introduce products or software to the target audience.
Software engineering leaders should also collaborate with stakeholders to expand this list, capturing additional relevant business terms as the product life cycle evolves.
Drive stronger performance on your mission-critical priorities. Become our Client