Explaining tradeoffs in terms of business impact

Our former head of engineering Raul once shared this wisdom: a junior engineer will say “we can’t do that, it’s impossible;” a senior engineer will say “we could do that, but here’s the impact to the business if we do…”

As you develop expertise in a subject, it’s tempting to think this gives you authority to make all decisions in that domain. After all, no one else understands the constraints and tradeoffs as well as you, so how could they contribute? But companies, especially tech companies, are cross-functional, collaborative enterprises: decisions from the legal team impact how engineering architects the system, which in turn needs to support marketing’s launch plan. By translating a decision into terms that your cross-functional peers can understand, you can bring in their context, explore a broader set of options, and find a better solution.

Raul offered this parable as an illustration: One day, a CEO comes to a junior engineer and says “I know you originally quoted 3 months, but we need to get this new product shipped in the next 6 weeks and we can’t cut scope.” The engineer naturally says “that’s impossible, there’s no way we can do that” and rejects the request. The CEO leaves, frustrated and annoyed, and goes to the VP of Engineering.

The VP of Engineer hears the same request, and responds:

We could do that, but it would be very expensive. Here’s what would happen: we’d have to cut a bunch of corners in implementation, so the product at launch would probably have a lot of bugs and perform poorly. I’d estimate that we’d have to do a full re-write after launch, which would take another 4-5 months of work.

In addition, we’d burn out at least a few members of the team. We should expect to see some attrition and long-term damage to the morale of our engineering team, which might make it harder to attract and retain engineers in the future.

Now, 99% of the time the CEO would agree with the VP of Engineering that the early release is not worth the cost. But 1% of the time, it might be worth it - say for instance that the company is running out of money but could secure a massive contract if they can launch in 6 weeks. By surfacing the tradeoff in terms of business impact, the VP of Engineering invites in the CEO to make the decision together, resulting in not only a better decision for the business but also a better working relationship.

It takes deep domain expertise to truly understand the tradeoffs of a decision. But the most valued experts are those who can explain those tradeoffs in terms of business impact, invite collaboration from cross-functional peers, and help the company as a whole make the right decision.