4 Ways to Lead a More Business-Savvy Software Engineering Team

Historically, software engineers have been siloed, with little or no input in any executive decisions. Fortunately, this has begun to change as data is increasingly leveraged as an asset in boardroom discussions, driving more collaboration across departments and roles. By being more plugged into the broader business and understanding how their work specifically contributes to the bottom line, engineers are becoming more valuable assets to their organization. I’ve outlined a few growth areas that can enable engineers to uplevel their careers and show greater value to their organizations.

1. Understand the business vision

Everyone should always be able to sell their company and/or products to anyone, no matter what department, level, or role they are in. To do so effectively, they must understand how the business works and what makes your company’s product unique in the market. This will help them understand user personas and build better products. Software engineers should take a step back to understand the bigger picture and they can do this by asking questions that connect their work back to the broader business. For example, when designing a user interface, understanding well what makes your product better for the target consumer can influence your implementation and design decisions.

2. Understand how the software is sold

Engineers are typically great at architecting and problem-solving, but they’re also invaluable when it comes to supporting and growing the business. By knowing precisely how the company makes money based on what they are developing, engineers will be able to visualize their contributions in a more tangible way. For example, engineers often benefit from connecting with sales teams to find out how the company charges customers, how the business model works once their code gets into production, and how new features might impact revenue.

Software sales knowledge, such as the difference between one-time outlays and periodic renewals, can also help engineers architect infrastructure differently so that it’s ultimately more beneficial for the business. There might be different tradeoffs where one option could be cheaper but it's a question of CapEx (Capital Expenditure) versus OpEx (Operating Expense), and the latter could be the company’s preference. For example, a SaaS platform might prefer OpEx because it allows them to more easily charge back to the customer. When prioritizing customer-specific feature requests, it helps to think about the long-term value to customers as a function of the implementation costs.

3. Learn to communicate effectively with the entire business

Engineers tend to be laser-focused on product development, and as a result, they may miss some of the business terms brought up in company-wide communications or meetings. For example, SQL means “Sales Qualified Lead” to sales and marketing teams, but “Structured Query Language” to engineering teams. Effective communication starts with understanding the context and vocabulary terms. Engineering leaders and managers can help dispel any confusion of these types of terms by creating a glossary that includes commonly used definitions within the organization. For example, the glossary can explain the difference between an AE (Account Executive) and SA (Sales Associate), as well as the difference between TCV (Total Contract Value), ACV (Annual Contract Value), and ARR (Annual Recurring Revenue).

4. Embrace experiential learning

The ability to communicate with others in the business, at all levels and in any department, about your work is an extremely valuable skill. As the company scales, engineers become more involved in the planning process and are viewed as integral contributors.

So how should engineers learn these new skills? Ideally, this expertise would be taught in school, so everyone (including engineers) has a foundational understanding of business and finance topics when they enter the workforce. That said -- it’s never too late to get started, and the more you learn the more it will help you.

Every team member can benefit from learning as much as they can about other parts of the business, making it just as important for executives to learn more about engineering. For example, hands-on demos where the engineering and sales teams take turns sharing their work can be a great approach. Engineers can role-play as a customer and have the sales team pitch them the software. Not only will this increase the engineer’s sales knowledge, but it can also help the sales team better sell the software.

This work is worth the effort, even though engineers are busy enough with their own work and this type of development may fall outside of their traditional job description. When engineers possess business and financial knowledge, they can feel more connected to other departments, more motivated in their role, and more involved with company planning, enabling them to map the architecture of infrastructure back to their company’s preferred business model.

The bottom line is that knowledge is power. As engineers look to advance their careers, developing business skills outside of their typical engineering roles will make them more indispensable assets to their company and lead to a more collaborative and effective work environment.