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> orgs who view software engineering purely as a cost center This is spot on! I've heard this phrase before and it's never made any sense to me. Any business c

> orgs who view software engineering purely as a cost center This is spot on! I've heard this phrase before and it's never made any sense to me. Any business concerned about profit should never have a "cost" center. If that unit is not returning a positive ROI it should not exist. Of course software development costs money just like all other labor, building and materials but it's assumed the value generated by the work product is worth the investment.

Hermitian909 7y ago
Cost centers are generally unavoidable, they're aspects of the business where there is a well-defined target past which there's no meaningful ROI. Regulatory compliance is a good example of this. Both you and your competitors must be compliant, but past reaching that state there's no additional value add. As a business, you're thus interested in keeping the cost of compliance as close to zero as possible, all cost cutting that does not break compliance is good for the company.
- 0x445442 7y ago
  But even your example can be viewed as an unavoidable cost of doing business where the alternative is to not be in business. In other words there's a distinction to be made between regulatory compliance where you have no choice and automating payroll processing where you do have a choice. I think it's pretty clear we're talking about the latter and I would not categorize an internal software development team who's job is to make the business run more efficiently as a cost center, even though there's not external sales of their work products.
- marcosdumay 7y ago
  Keeping the cost of compliance small isn't the same as doing as little work into compliance as possible. More often than not, it's the other way around. Corner cutting doesn't work on any of the usual "cost centers", and most of them can be transformed into a differential.
JJMcJ 7y ago
All too often "cost center" is used to mean "anything except sales and marketing".

Hermitian909 7y ago

Cost centers are generally unavoidable, they're aspects of the business where there is a well-defined target past which there's no meaningful ROI. Regulatory compliance is a good example of this. Both you and your competitors must be compliant, but past reaching that state there's no additional value add. As a business, you're thus interested in keeping the cost of compliance as close to zero as possible, all cost cutting that does not break compliance is good for the company.

0x445442 7y ago
But even your example can be viewed as an unavoidable cost of doing business where the alternative is to not be in business. In other words there's a distinction to be made between regulatory compliance where you have no choice and automating payroll processing where you do have a choice. I think it's pretty clear we're talking about the latter and I would not categorize an internal software development team who's job is to make the business run more efficiently as a cost center, even though there's not external sales of their work products.
marcosdumay 7y ago
Keeping the cost of compliance small isn't the same as doing as little work into compliance as possible. More often than not, it's the other way around. Corner cutting doesn't work on any of the usual "cost centers", and most of them can be transformed into a differential.

JJMcJ 7y ago

All too often "cost center" is used to mean "anything except sales and marketing".