When Is Technical Debt A Good Thing?

Innovation When Is Technical Debt A Good Thing? Sanjay Brahmawar Forbes Councils Member Forbes Technology Council COUNCIL POST Expertise from Forbes Councils members, operated under license. Opinions expressed are those of the author. | Membership (fee-based) Jun 14, 2022, 06:15am EDT | Share to Facebook Share to Twitter Share to Linkedin CEO of Software AG .

getty As the world grows more connected, businesses are evolving to keep up with the rapid pace of digital transformation. Consequently, IT spending is on the rise globally and is projected to total $4. 4 trillion in 2022 , up 4% from 2021, even in the face of political unrest, inflation and supply chain disruptions.

Businesses are expanding tech stacks to meet customer demands and outrun their competition, but as they implement new technology, they must embrace technical debt. What’s technical debt? For businesses, it means the additional coding/recoding work that’s needed after a system’s gone live. This debt may be intentional, such as to facilitate faster launches, or it might be unexpected, either because of things overlooked at launch or because, over time, the requirements of technologies change.

In the same way that responsibly using a credit card can help with managing personal finances, technical debt, when properly managed, can help businesses keep pace with customer or market requirements. Many companies are changing their tune on technical debt, too, recognizing it’s important for transformation, growth and business culture. These businesses also believe that the benefits of taking on debt outweigh the downside.

With that perspective in mind, it’s worth looking at how technical debt can benefit businesses. Customer-Driven Changes MORE FOR YOU Google Issues Warning For 2 Billion Chrome Users Forget The MacBook Pro, Apple Has Bigger Plans Google Discounts Pixel 6, Nest & Pixel Buds In Limited-Time Sale Event We’ve seen a dramatic shift in consumer behavior in the last few years, as people have embraced online and digital alternatives to in-person experiences. For example, retail companies pivoted to curbside pickup during the pandemic as consumers elected for a contactless shopping experience.

The key is that customers are more in-tune with what’s possible from a digital perspective and will demand more when it comes to what constitutes an acceptable experience. Most technology change is driven by the expectations of its users or those most affected by it, and organizations must be able to move at the same pace as their consumers. But some companies aren’t equipped to do that.

As digital transformation continues to accelerate, organizations will need to reorient themselves toward the quicker development and launch of digital tools. One way to achieve this is by thinking strategically about technical debt. Launching a minimum viable product (MVP) with a plan to develop noncritical aspects post-launch is an effective way to speed up go-to-market time.

For example, our client Deutsche Telekom, one of the largest telco providers in Europe, recognized its customers’ need for quicker IoT deployments. It developed an MVP version of an IoT onboarding platform for its customers and saw its IoT revenue triple following the launch. Another option for fast-tracking launches is to look externally.

Buying instead of building can speed up the process and reduce technical debt. Similarly, working with partners or cooperating with competitors to find areas of mutual benefit can speed up transformation journeys. Internally Driven Changes Recent global changes haven’t only affected consumer behavior but also the ways in which companies operate internally.

New initiatives from hybrid working to information security have been implemented in record time. When companies rapidly change, understanding the positive role of technical debt can help them succeed. Rolling out new processes with fully operational core functionality and unfinished peripheral services helps speed up internal process changes in the same way as external ones.

However, there still needs to be a plan to ensure this “good debt” doesn’t turn bad. Organizations must ensure they have the technical expertise on hand and are sufficiently resourced to deliver on the roadmap for managing technical debt. If additional coding is deferred from the initial development, it doesn’t disappear.

In fact, it’s arguably more complex, as it’s combined with update requirements and changes prompted by feedback or analytics. It’s important these products or services aren’t forgotten from a development perspective after launch. Accruing technical debt due to changing internal processes is difficult, but the pros outweigh the cons.

The move to hybrid environments created significant technical debt, but from what I’ve seen, most of those who incurred it see it as “good debt” and would do it again to keep operations functioning. Automation-Driven Efficiencies Increased awareness of how technical debt occurs may help organizations proactively avoid it. Automation is one area in which this is true.

Many automation projects have been experimental or very specific to one process or one part of the business. This isn’t problematic in itself, but as these organizations begin to scale their automation efforts, they may encounter some issues. When the time comes for different automated processes to interact with one another—perhaps a purchase-to-pay process is required to integrate with warehouse processes—they must share the same standards.

If they don’t, the project will hit a wall built of technical debt. Open, or otherwise clearly defined, standards for automation from an early stage will limit the possibility of encountering bad technical debt or accruing exponentially more debt in the future. In a similar way, as low-code and no-code platforms and applications gain popularity, a failure to standardize could lead to unexpected debt in the future.

Whether data sharing to connect customer experience journeys or simply scaling to new areas, companies can protect themselves by using open standards and/or thinking in a more connected way from the beginning. Managing Technical Debt Makes It “Good Debt” The technical debt that comes with deploying and fast-tracking new technologies is often a worthy tradeoff, and most organizations would say that it was worth it to be able to be more agile. It’s up to businesses to manage this debt with a comprehensive strategy that includes development roadmaps and upskilling/training employees to help with execution.

The benefit of this is the increased awareness of technical debt at all levels of a business, not just within IT teams. In practice, an organization’s collective efforts to mitigate or manage technical debt will equip companies with strategies to encounter less debt in the future, and ensuring technical debt is “good debt” will be a key for successful digital transformation. Forbes Technology Council is an invitation-only community for world-class CIOs, CTOs and technology executives.

Do I qualify? Follow me on LinkedIn . Check out my website . Sanjay Brahmawar Editorial Standards Print Reprints & Permissions.