Last updated on January 17th, 2023
When the debt is accrued, it has to be paid and usually with interest. Technical debt is no different. In fact, it is very similar to financial debt.
With financial debt, you borrow money today and have to pay it back along with interest in the future. In the case of technical debt, you borrow or shift time instead of money. Often, technical debt occurs when software development teams choose quick or easy solutions to deliver short-term projects. These solutions are not reliable and sustainable in the long term and lead to bugs and security concerns regularly. The shortcuts taken by the development team today take excessive time and effort to fix the bugs in the future.
According to a McKinsey survey, over 20% of the technology budget is reserved for resolving technical debt issues. It is also estimated that the technical debt amounts to about “20-40% of the total value” of the technology.
Along those lines, this article sheds light on the following:
- What are the causes of technical debt?
- What is the impact of technical debt?
- How to reduce existing technical debt and control the emerging debt?
Causes of Technical Debt
Although technical debt is a consciously created (and assumed) debt, it can also be created unintentionally. For example, old and unaddressed bugs, code without annotations, or unattended or out-of-date manual testing results can lead to high possibilities of technical debt. Mostly, technical debt occurs when the development team deals with strict project deadlines.
Another key reason is legacy code and using outdated libraries and frameworks. Technical debt can also occur when the development team struggles with high customer expectations, constant changes, developer turnover, and new cyber threats. Some other reasons for technical debt include:
- Insufficient information about the product idea
- Changing business goals that make the technology solution irrelevant
- Poor collaboration between team members
- Frequent evolution of technology and delays in modernization
- Budget restrictions
- Lack of business processes and culture around best coding, testing, and automation practices.
Impact of Technical Debt
Just like financial debt, it is crucial to pay back technical debt in time because otherwise, it can create a domino effect making it difficult to deal with it later. The longer the debt will remain unaddressed, the higher the interest (difficulty and cost of dealing with bugs and security concerns) will be. Some major consequences of mismanaged technical debt are increased bugs, weak performance, increased difficulty in making changes and scaling the project, more security risks, and higher maintenance costs.
Here’s how technical debt impacts product engineers:
- Over 52% of engineers believe that technical debt harms the team’s morale.
- Over 60% of engineers think technical bugs cause major outages and slow down development.
- The average engineer spends more than 7 hours per week (almost a working day) managing technical debt.
- Over 66% of engineers believe that the team will ship up to 100% faster if there is a standard process for technical debt.
How to Reduce Existing Technical Debt and Control the Emerging Debt?
Here are the key steps to control and reduce technical debt and ensure that it is paid off with minimum investment.
Step 1. Acknowledge and Understand Debt
The reduction of technical debt starts with accepting the debt and understanding its source. At this step, it is vital to identify how the debt has occurred. Was it unintentional or deliberate? Was it caused by changing requirements, obsolete technology, project goals, or any other reason? The answers to these questions will help you understand the nature of technical debt and determine the ways to reduce it.
Step 2. Evaluate and Measure the Technical Debt
Different factors and techniques can be utilized to measure technical debt’s impact on the product, team, and organization. Technical debt can decrease development speed. So, the amount of work done and iterations can indicate the impact of technical debt on the team’s performance. The team can also use analytics tools to evaluate the system performance and track the problems that caused the debt. After evaluation, the risks can be assessed with respect to cost-benefit analysis.
Step 3. Communicate the Impact to Stakeholders
After assessing the technical debt thoroughly, the cost-benefit analysis and impact should be communicated to tech and non-tech decision makers within the organization. It is an essential step because a clear analysis will help them prioritize and plan the repayment strategy.
Step 4. Schedule Regular Pay-off
This step is crucial to reduce technical debt as it develops the strategy to pay off the debt without compromising the ongoing process. One of the most effective strategies is to divide the additional work and rework into small milestones and pay it off gradually by integrating it into the routine workflow.
Step 5. Practices to Minimize/Avoid Tech Debt
While reducing existing technical debt is important, it is also vital to control the debt in the future. A few best practices can be introduced to minimize and avoid technical debt as early as possible. Some of these practices include:
- A solid testing strategy to avoid bugs running out of control
- Monitoring the code quality and complexity to make it understandable and reusable
- Keeping a track record of technical debt
- Prioritizing an agile development approach to reduce the accumulation of technical debt.
Start Reducing Technical Debt Today
Properly managing the technical debt helps strengthen the team and enable productive conversations across the organization. However, it is essential to understand that technical debt will always exist at the time of creating applications.
Favorably, the above steps can help reduce technical debt by identifying the main source and evaluating and scheduling the pay-offs. Along with this, businesses need a reliable and experienced technology partner who can help them manage technical debt with the necessary tools and strategies.
Get in touch with our tech experts to consult your project requirements and discover the most efficient ways of managing technical debt.