Explaining the Reason for Technical Debt
“Technical debt” seems to be the buzzword these days. Simply put, technical debt is the difference between what was promised and what was delivered with a given product or service.
In a 2020 McKinsey survey, CIOs reported that 10 to 20 percent of the technology budget dedicated to new products is diverted to resolving issues related to tech debt. Even more concerning, CIOs estimated that tech debt amounts to 20 to 40 percent of the value of their entire technology estate before depreciation. I don’t need to tell you that for larger organizations, this translates into hundreds of millions of dollars of unpaid debt. As CxOs know, the concept is not new. We have to be accountable for how we organize and skill our teams.
Simply, I would say two major factors are the reason for technical debt: vendor selection and out-of-touch leadership.
Firstly, there’s vendor selection. Using the analogy of a car rental, we can grab any vehicle off the lot and drive off. What we have in theory is a well-maintained vehicle that is usually a year or two old, and if something goes wrong, we simply ask the rental company to change the vehicle. I have done this many times with minimal thought nor penalty.
Secondly, it is vital to have a hands-on understanding of the real-time evolution of our chosen technology. Going back to the car analogy, one would never productize the electric vehicle if one has no idea on how not only a car is made, but how an engine is built.
It’s an inconvenient truth that technical debt is something we incur – be it consciously or otherwise. The more senior one becomes, the farther away from the details one becomes. So as leaders, we must ensure the technologists who know how the technology operates have a voice and are heard within our team. Some generic guidance: do not have three layers in an organization that have no one aware of the underlying technology.
An environment with “drivers” as leaders, without an ecosystem where the on-the-ground technologists have a say, will cause inevitable technical debt. Making matters worse, this issue often takes a couple of years to become entrenched and two more before an organization recognizes there is a problem.
It is critical to listen to the experts and have someone in your leadership team who knows how engines are built. Ensure there is telemetry and that those who recognize the “rattles and noises” of the engine are at the table.
Lastly, select your vendors wisely. Vendors are great, but they too are human, and the installed base should be used as a launch pad for evolution versus a boat anchor with technical debt.
As difficult as it may be, declaring bankruptcy on your technical debt is sometimes the optimal business decision. My hope is that by following the guidance above, you can mitigate against this least desirable outcome.