“Tech Debt” + What It Means for Your Business

by | Jun 15, 2021 | Technology Strategy

When most of us think of the word “debt,” a financial contract of some kind comes to mind, such as debt on a mortgage, car loan, or major purchase. But have you ever thought of debt in the context of technology? If you haven’t, you should. It is as real as the debt on a home purchase and at some point, it needs to be paid. 

What is technical debt? 

Whether we want to believe it or not, technical debt (or “tech debt”) is a guiding principle within the world of technology. The general idea of tech debt states that if the components of your environment are not serviced on a regular basis, then they will begin to fail over time and ultimately cost you more in the long run.  

Likening it to more financial terms, “if technical debt is not repaid, it can accumulate ‘interest,’ making it harder to implement changes.” It is applicable to enterprises both big and small and it can come due when you least expect it. 

I have spent the better part of 20 years involved in organizations in an operational capacity, so I’ve seen firsthand just how impactful this principle can be, whether positive or negative. In the beginning, the “debt” on a piece of equipment (switch, server, SAN, key piece of software) is negligible, but as time wears on, it can grow exponentially. 

To service or not to service

So why is the servicing of technical debt generally avoided? To answer that, you must look at how organizations view technology. On one hand, there are organizations that view technology as a cost center, which means that they view it in the same way that they view the utility bill or rent on a building. It is a cost of doing business and is managed as such.  

Alternatively, there are companies that view technology as a competitive advantage, using it to move ahead of their competition.  

For the organizations that choose to view technology as simply a line item on a balance sheet, time works against them as they avoid the very real need of updating and servicing the IT infrastructure. In the same way that deferred maintenance on a house ultimately leads to more expensive repairs, deferring to service the technical debt eventually leads to it becoming just that, a cost center. Translated, it costs the organization much more in the long run. Additionally, delaying the maintenance and updating can also lead to serious security concerns. 

Instead, technical debt reduction should comprise a retail, architecture, and maintenance plan that’s based on a client’s needs not only now, but well into the future.  

Leveraging the cloud

A key component of servicing technical debt is the process that an organization undertakes to upgrade its key infrastructure every five to seven years. However, these are seen as “heavy lifting” exercises, which some companies do not want to (or cannot) undertake for various reasons including a lack of resources, staffing, or funding.  

The good news is that if an organization finds itself in a position where they have a high level of technical debt, they have many options in front of them. Today there are several cloud-based Infrastructure as a Service (IaaS) offerings to help them out of their predicament. 

Not too long ago an organization would be faced with a heavy capital expenditure if they performed regular upgrades to their critical infrastructure. Now, any organization can move key workloads off aging equipment in a very short period. While this does require a shift to an operating expense (OPEX) model (vs. capital expense, or CAPEX), it allows businesses to rapidly reduce the debt that has built up over time. 

Security concerns in tech debt discussions

One of the most commonly missed items in the technical debt discussion is the security concern. We often discuss the debt with clients in the context of aging hardware and/or legacy operating systems. Specifically, the conversation centers around how either of them can impact the organization in a negative way. They should be addressed swiftly. We also discuss the very real fact that technical debt accrual can lead to serious security concerns. 

A non-supported operating system, for example, poses a significant risk to an organization when that server is no longer available to receive critical security updates from its vendor. The technical debt that is represented by a server/system running an aged-out OS could eventually put the entire organization at risk.  

Enabling the business with technology

For those businesses that see technology as a business enabler, they can begin to pull several “levers” to help move their organizations forward and out of the technical debt morass they might find themselves in.   

If properly positioned and aligned to the organizational objectives, technology can be used to reduce costs, gain insights into sales efforts, launch and track new product offerings, and simply keep the organization more secure. At the end of the day, the company that understands and addresses the technical debt component will be in a much better position to thrive and survive. Ultimately, this will enable the business to succeed. 

For companies to effectively deal with technical debt they must first recognize that it exists within each of their organizations. It requires that they be honest with themselves about the level that they are currently carrying. Then, and only then, can they begin to address it. 

Are you ready to address your technology strategy (and the technical debt you have)? 

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