Understanding Technical Debt: A Hidden Business Challenge
In the fast-paced world of business, the term "technical debt" may not be familiar to many business professionals, but it is essential for decision-makers to understand. Technical debt originally originated in software development but has found applications in various fields, including machine learning and infrastructure. In simple terms, it can be defined as the accumulated cost of suboptimal decisions, such as choosing less-than-ideal solutions, neglecting upgrades, and maintenance, and making other technology-related choices. In this post, we will delve deeper into what technical debt is and provide an easy-to-understand example. Technical Debt: A Metaphor for Business Trade-offs The concept of technical debt was coined by software developer Ward Cunningham. It serves as a metaphor for the trade-off between speed and perfection often encountered in software development. Just like financial debt, technical debt can help you achieve your goals more quickly, but it comes with "interest" in terms of time and money that you'll have to pay later.
Real-World Example: The Cost of Neglecting Technical Debt
Recently, a company reached out for assistance because they were struggling to connect their laptop to the available wireless network. As I guided them through troubleshooting steps over the phone, they mentioned missing icons and being unable to see the screen I described. After about 20 minutes of confusion, I asked them to type "winver" in their command line, and they replied with "Windows Vista," a Microsoft operating system released in 2006. Fortunately, we managed to get them connected, but this incident perfectly illustrates technical debt. To the end user, their computer seemed to be working fine for their needs, and they questioned why they should bear the cost of replacement. However, there were several hidden costs caused by their technical debt:
The Hidden Costs of Technical Debt
- Increased service call costs due to the significantly longer troubleshooting time on an outdated operating system.
- The potential inability to connect to the wireless network as modern standards might not support older protocols.
- A lack of security updates, increasing the risk of a compromise.
- Increased training costs because the system would be unfamiliar to many users.
- Limited application options, as most modern software doesn't support the outdated operating system, including web browsers like Google Chrome.
These five factors could easily lead to downtime, impacting revenue, customer satisfaction, and potentially putting the business at risk due to a security breach.
Addressing Technical Debt: A Strategic Approach
Addressing the issue of technical debt from a strategic perspective involves four key steps:
- Identify critical IT systems and assess the level of technical debt associated with them.
- Define what technical debt means for your company.
- Identify instances of technical debt.
- Determine what level of technical debt is acceptable to your organization.
- Estimate the business risk and cost of technical debt.
- Prioritize the list of areas to address.
- Develop a plan or roadmap to reduce technical debt.
- Create initiatives and action items to tackle your technical debt.
- Establish standards and processes to monitor and manage debt.
- Develop standards for technical debt management.
- Implement processes to regularly reassess and monitor changes in technical debt.
Infotech offers some free tools that can help you initiate this process within your organization.
Conclusion
In the world of technology, technical debt is inevitable as systems evolve, standards change, customer preferences shift, competitors innovate, and various other factors come into play. Trade-offs will always be necessary, considering limited resources like time and money. However, understanding the concept and having a plan to address technical debt can make the difference between making monthly car payments and facing an unexpected, substantial lump sum to replace a stolen vehicle.