why I’d rather work in a profit center

Saturday, 27 March 2010

Given: business software developers are people finding a better way* – we’re writing software to help improve the business.

a straight ascending line approaching infinity with a curved descending line approaching zero

A cost center improves by spending less. Therefore, the impact of our software development effort approaches a limit of zero. The law of diminishing returns kicks in, and effectiveness decreases logarithmically over time.

A profit center improves by earning more. Therefore, the impact of our software development effort approaches a limit of … infinity (theoretically, at least).

This is a gross over-simplification, but the dynamics are real.

* Apologies to Dana Corporation. My dad always said the slogan on their trucks reminded him of me.

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