Technical debt is a major concern for global companies across a number of industry sectors. It is the term used to designate the end product of development teams working at full speed on software to meet delivery deadlines: bugs, legacy or misplaced code, flawed documentation, and more.
Technology debt is important because it acts as a barrier to progress towards increasingly important business transformation goals. Essentially, this limits a company’s ability to scale, operate at speed, and respond to changing market demands.
Addressing technology debt requires significant investment. The accumulation of technology debt is inevitable, but it cannot be ignored. This is increasingly evident for organizations whose past technology sprints are catching up with them. Maintaining code that is prone to failure is costly and can reduce agility and limit innovation. The situation is most acute in regulated industries, where outdated systems and inflexible software are commonplace.
To put the scope of the impact of technology debt into context, nearly 70% of organizations believe that technology debt has a high level of impact on their ability to innovate. Add to this the estimates that 40% of IT balance sheets are allocated to technology debt, and it’s no wonder that the issue is moving up the priority list and becoming not just an issue for IT leaders, but for senior executives more broadly.
CIOs can no longer delay taking decisive action. The typical approach to technology debt, which involves overhauling products and services after launch to fix problems, is no longer valid. With a massive buildup of technology debt, it is not enough to address the symptoms without also addressing the underlying issues. Instead, organizations should consider implementing the following strategic steps to effectively manage technology debt:
Adopt automated software testing
Historically, software development has focused on releasing minimum viable products. However, this focus on speed has increased levels of IT debt. IT needs to focus more on quality. AI tools that power test automation can help identify, predict, and fix issues before software is released. Continuous monitoring of applications in production helps improve quality and prevents updates from introducing problems.
Consider technology debt as a business risk
Technology debt is often thought of as just an IT problem, but it is an issue that affects the entire organization. Having visibility and tracking of technology debt makes it easier for everyone to understand the magnitude of the problem and how it could impact the organization. Understanding the cost in specific business areas creates a culture of shared responsibility and puts it firmly on the radar of leaders.
Prioritize the cloud and upgrade legacy software
One way to help build resilience is to migrate legacy software to the cloud. This makes it easier to pay down the technology debt that has built up over time. Plus, it can be maintained using modern software development approaches.
For example, earlier this year, British Airways announced that it is investing £7bn in a modernisation programme that includes migrating 700 IT systems to the cloud. This comes in the wake of the airline suffering a number of IT outages due to data centre failures, including two outages in 2022, one which forced the company to cancel all short-haul flights from London Heathrow Airport and another where flights were forced to be grounded overnight. This case study illustrates the costly impact of maintaining legacy technology and the importance of modernising and addressing the root cause of technology debt, rather than just its symptoms.
Identify and quantify technological debt
Companies need to set parameters for acceptable levels of technology debt so they can work to ensure debt stays within agreed limits. This requires categorizing and tracking it using specific tools.
Developers can use code inspection analysis to scan and report on potential technology debt detected. These are then tracked, prioritized, and remediated as part of an ongoing lifecycle to ensure secure and scalable software.
Define a solid and scalable foundation
Creating an organizational architecture provides a framework for managing, supporting, and protecting technology. Examples include enterprise architecture to align business and IT objectives, technology architecture to design IT infrastructure including cloud service applications, and integration architecture to develop robust applications with interoperability in mind. If a new solution does not support the approach, it should not be implemented. Over time, frameworks can evolve to support the changing needs of the business. Adhering to an established architecture reduces the amount of debt accumulated and accelerates the pace of development.
Organizations across all industries are laser-focused on modernizing their systems and applications. Recent advances in artificial intelligence and machine learning have acted as accelerators for this modernization. Reducing the growing burden of technology debt is critical to achieving this.
By implementing the initiatives outlined, organizations can meet this growing challenge head-on, paving the way for continued agile and resilient work while limiting excessive shortcuts that cause problems. With these priorities in place, companies are in an excellent position to accelerate the time to value for new technologies and thrive in doing so.
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