The company you work for has been operating successfully in the market for decades, supplying high quality products. The company has a reputation for innovation and reliability, and the stock price reflects that.
However, as your IT ecosystem grows in complexity and size, your company begins to face challenges related to accumulated technical debt. This debt includes outdated technology, architectural inconsistencies, and inefficient development and deployment practices. So you've seen some negatives over the past few years:
Increased maintenance costs. This is one of the big impacts of technical debt on a company. It's just more expensive to do simple things; for example, changing a database ends up breaking a hundred applications.
Slow down and develop agilely. Technical debt severely hinders your company's solution development. Accumulated debt leads to code complexity, making it difficult to add new features or implement changes quickly.
Quality and reliability issues. When technical debt compromises the quality and reliability of core products, it can negatively impact a company's brand reputation and erode customer trust, resulting in lost revenue. We can all think of "used to be good" companies.
Difficulty attracting and retaining talent. Excess technical debt creates challenges in attracting and retaining top talent. Skilled professionals prefer to use modern technologies, good and efficient architectures, and clean code bases.
understand the problem in order to solve it
What options do you have to make things better? First, understand the problem. Technical debt is a metaphor that describes the impact of suboptimal technical design and deployment practices or decisions.
How did it appear? Choices are really bad over time. It could be bad architecture because IT leaders choose a less efficient solution. Maybe they chose a particular vendor, or even a cloud provider, for the wrong reasons (such as a pre-existing relationship). This leads to a solution that works but adds technical debt instead of eliminating it.
I've heard the excuse that the decision to expedite solution delivery was made for urgent business purposes. However, this is almost never the case. Most of the time, technical debt accumulates as a result of bad decisions; the company could have moved in a direction of not incurring technical debt, but it didn't. In fact, many better solutions cost less and take less time to deploy.
In other words, most technical debt is a collection of self-inflicted injuries, often by leaders who are unwilling to understand the big picture or take technical shots in the dark. Sure, "it works", but it adds significantly to technical debt. In my 40-year career, I have second-guessed many of these issues.
Key lesson: Avoid accumulating technical debt by choosing and using technology more wisely, including cloud. When someone comes up with a specific solution, question it. Any technical solution always has advantages and disadvantages, which must be weighed and understood. If you don't, technical debt will follow.
The cloud can't always save you
Businesses that have accumulated large amounts of technical debt often look to cloud computing or digital transformation to eliminate some of that debt. The problem is, if you don't know exactly what you're doing, you can make things worse.
You just need to look at the hundreds of thousands of applications and databases that have been pushed to the cloud over the past four years and discover that they are more expensive to operate than where they were originally. It's not cloud computing's fault, it's a lack of understanding of the pros and cons of new target platforms for those particular applications and databases (in this case, the public cloud).
For example, spending a little money refactoring an application to make it more efficient on the public cloud can eliminate most of your technical debt with very little effort or money.
What's happening now is that businesses are responding to their technical debt as businesses experience a downturn, markets start to accelerate, customers demand better experiences, generative AI proliferates, and more. The need to change technology accelerates, but companies have too much technical debt and inefficiencies to keep up with the need for growth and change.
Other companies can. Businesses do go bankrupt because they accumulate so much debt -- just like our personal lives, if you think about it.