Lessons from Running a Business P&L

Marc West, Senior Vice President and CIO with H & R Block, spent 5 years managing P&Ls for Oracle, software vendor Trade.com and real estate services company Move.com. He learned some painful lessons about business that he’s taken back to the IT department. Number One: getting paid and reducing operating margins are the only metrics that really matter to the business.

These are not the usual metrics that IT departments use to measure themselves. In his Tuesday morning presentation, “How I Managed a Business P&L and What I Learned in the Process,” he challenged IT executives to stop communicating performance in terms of uptime and on-time, on-budget delivery of systems. Instead, he says, you have to measure your performance using the same metrics the business uses to measure its success.

Salespeople, he says, develop a passion for whatever they sell, West says: They believe that if customers go anywhere else, they’ll be underserved. “Imagine capturing that in an IT organization. If people need to go somewhere else to get goods and services, you’re under-creating value for them.” Instill that ethos by sending application developers and business analysts to the call center after you deploy an application. And spend 20-25 percent of your own time with the business.

If the show of hands in the audience is any indication, not many IT execs have had similar experiences. Only a few attendees raised their hands when he asked if they’d participated in a full sales cycle at their companies, or run a P&L themselves

West spent 40 days during tax season in H&R Block’s retail stores, and in call centers, learning how the company sells its services. At one point, he was asked if he could fix the printer – a strategic piece of equipment when it comes to printing checks for customers, so he rolled up his sleeves to take a look.

“The business understood I wasn’t someone who was just going to sit there and take meetings. And I actually got a good sense of how things were working.”

 –Elana Varon, CIO magazine Senior Editor