Should You Declare Bankruptcy on Your Technical Debt?

Decision-makers, it’s high time we wake up to the real cost of technical debt. Financial debt is a burden that’s familiar to many people, but for businesses, especially retailers, that burden takes on an additional form: technical debt.

For companies building their businesses on outdated platforms, technical debt is what’s keeping them from evolving to meet the demands of today’s increasingly mobile consumer. According to a study by Accenture, 85% of executives believe that their legacy platforms are hindering their ability to move to a more digital model. 

Executives and IT teams often put software migration on the backburner, choosing instead to focus on the kind of projects that result in more immediate monetary returns. Yet the longer technical debt is allowed to accrue, the costlier it becomes. Should your IT department stick with its broken platforms, just to avoid the overhaul, or is it time to pull the plug?

Here’s how IT professionals can identify their pain points and declare bankruptcy on tech debt.

What is technical debt, anyway?

Essentially, technical debt refers to cutting corners, turning to quick fixes, or just maintaining the status quo in order to meet goals. It enables engineering teams to finish updates sooner —despite confusing code, ignored bugs, no tests, no docs — with the expectation that it will cost more time, money, and labor to fix in the future.

You’re probably familiar with this scenario: You want to add a new feature to your website, but a bug is preventing you from doing so. Rather than address the foundational cause of that bug, your team finds a less-than-optimal workaround solution to get the job done. Or another common one, your DevOps team, after auditing your systems, recommends migrating to a new platform for a certain service. Instead of eating that cost (in money and time) now, decision-makers in the C-suite decide to stand pat until next year because the existing system is “good enough.”

This happens again and again, and eventually, your business is left to contend with a set of disparate systems that can’t be synced or automatically updated or easily maintained. This is how software becomes legacy, and how technical debt compounds, weighing down the cost of your operations, little by little, until one day, your business pays the ultimate price.

Technical debt comes with a price

It’s tempting to sweep your software issues under the rug, especially when revenue is what keeps a company afloat. Oftentimes, long-term architectural work is put on hold in order to prioritize new customer-facing features. But if technical debt persists, that eats into operation costs. Every minute your dev team spends fixing bugs is a minute that could be spent on developing new products, expanding into new markets, and adding actual value to the business. By neglecting to address your tech stack, you’re actually letting your customer down, no matter how many new features you launch. Every second spent is another dollar wasted, and money left on the table. 

How can I tell if I have technical debt?

With many companies, technical debt is so common that the tell-tale signs often seem harmless. We’ve all tried to push forward a new feature, only to be told, “If we want to build this, then we’ll need to rebuild X, Y and Z first.” This means that at some point in the development process, a corner was cut, and now, the debt must be repaid in time and money. If a minor feature request comes attached with an inexplicable backlog of to-dos, it’s a red flag.

Another sign of debt is the time you are devoting to maintenance. If you’re employing people for the sole purpose of fixing bugs, and the team seems to be growing, then you are accumulating technical debt. This is a scenario I see constantly with our clients, like the one who told us this in our first meeting: “Our backlog kept getting longer, never shorter, until eventually it was clear that we would never be able to work through that list.”

Throwing extra bodies at the issue isn’t going to resolve things in the long run. If it’s taking you more and more time and headcount just to maintain the status quo, then it’s time to take a step back, address your structural problems and, if necessary, consider declaring technical bankruptcy.

Technical debt is a hidden cost that robs your business of its ability to be nimble and make needed changes for your customers. No matter how innovative your marketing strategy might be in the near future, it won’t matter if your legacy systems prevent you from executing properly. Better to pay the piper sooner rather than later, when it might be too late.

Sara Hicks is CEO of Reaction Commerce, an open source commerce management platform.