What causes technical debt and how can you reduce it?

IT leaders are responsible for delivering solutions that cut expenses, transform organizations, and increase revenue. However, technical debt is probably one of the largest obstacles organizations encounter.

The delivery of IT solutions can be severely slowed down by technical debt, which creates friction. The outcome? Your IT team is unable to provide the scale that the business needs. IT management must resolve the technical debt to satisfy the needs of the business.

What is technical debt?

Technical debt is the implied cost of further rework brought on by selecting a quick and simple solution rather than a more effective strategy that would require more time and effort.

What causes the technical debt?

Technical debt can be brought on for a variety of reasons. Businesses on the verge of profitability or are ready to sell often have limited IT spending. Despite the loss of system support and maintenance, this forces IT to work with what they have.

Everything in a firm, including outdated systems, IT procedures, and employees, is yours when you buy it. The acquired firm frequently adopts a different approach to IT, such as a decentralized rather than centralized method of providing IT services.

Business stakeholders frequently make choices that restrict the scope or require IT to take shortcuts to bring a solution to the market quickly.

Poor software/application architectural choices will necessitate the refactoring of the solution in the future. Applications are frequently over-architected, resulting in an unreliable "nuclear flyswatter" that is challenging to maintain. Software selection is often made for packaged programs. This technique is frequently extremely cost-focused and highly subjective. A less expensive solution than its rivals could also be less adaptable, inflexible, and challenging to maintain. Refactoring may be necessary due to the poor code quality produced by an inexperienced team. Although they are eager to adopt the newest tools and technologies, developers often lack the knowledge necessary to leverage them to create scalable solutions.

Platforms for ERP provide a wealth of features and capabilities. However, the business processes that each ERP incorporates enable businesses to customize the platform to their business process. When businesses strive to improve, problems arise. A system with too many adaptations may be expensive to maintain and difficult to upgrade. The result is a decrepit, unmaintained ERP platform.

Technical debt can break an IT organization

Because of outdated tools, systems, and platforms, technical debt increases the time it takes for IT to offer solutions. Integration is more challenging and takes longer during development and testing.

When manufacturing systems are unavailable, customers cannot place online orders, delayed shipments, and vendor integration is impossible. Relationships suffer, and businesses may swiftly lose clients or even revenues.

How to reduce technical debt?

Technical debt exists in almost every business, and it is typically not financially feasible to pay it off at once.

Make a thorough inventory of the current technical debt at your company. You'll need a thorough list to move on to the next phase.

The greatest dangers must be addressed first because addressing technical debt all at once is not financially possible. You can prioritize your list by responding to the following queries:

Which platforms or products cause a security risk?

Which platforms or solutions risk your business associates, suppliers, or clients?

Which technologies or products have a big impact on IT costs?

Make sure to specify the technical environment of the future state. If it isn't, you risk adding to your technical debt by delivering solutions that aren't built on the target platform or technology stack.

Create a plan to execute and align with the company and executives once you have determined the high-priority items and the future state architecture. You may reduce risk to the organization by starting with the high-value, high-risk things.

The supply of IT solutions to your company does not have to be slowed down by technical debt. Knowing where the technical debt is located will help you identify the high-risk areas and devise a plan to remedy them.