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Not long ago, people often viewed technology investment as more a casual add-on than a core component. Investing in technology was a nice-to-have rather than a must-have, and investment in technology enhanced the organisational experience but didn’t drive it. Now, things have changed. 

What is technical debt? 

Technical debt arises from IT resources that no longer meet an organisation’s needs, resulting in inefficiencies and waste.  

While some associate technical debt solely with poor software coding, it actually encompasses everything from code and applications to physical hardware. Often, the latter carries the heaviest financial burden. 

Technical debt has become a major challenge for technology professionals, and most tech professionals have experienced its impact within the past year.  

This is a significant problem that requires immediate attention and a strategic plan to overcome its detrimental effects on organisational performance. 

The Criticality of Technology on Organisations 

Technology has evolved from a luxury to an essential organisational component, and its integral role in mass production, delivery, and retail is undeniable.  

According to the Australian Government’s Digital Technology report: 

• Australian businesses have been increasing their IT spend, with an approximated increase of 13% to $117 billion in 2022, outpacing the global average at the time of 4%. Businesses invest heavily in IT infrastructure, software, and data capabilities. 

• In 2022 Australia placed in the top ten nations worldwide for 5G connected devices, data centres, telecom investments, and digital cities. 

Technology significantly impacts organisations of all sizes, boosting productivity, efficiency, demand, and overall survival, and technology’s positive influence on organisations is immense. Simply put, technology is a game-changer for organisations. 

Why You Should Care About Technical Debt 

Technical debt is the hidden cost of outdated or inefficient technology. It’s like neglecting home maintenance; minor issues ignored today can lead to costly problems tomorrow.  

Here’s why it matters: 

• Increased costs: Outdated systems often require more resources to operate and maintain, driving up expenses. 

• Missed opportunities: Old technology can hinder innovation and prevent your organisation from taking advantage of new trends. 

• Reduced efficiency: Inefficient systems slow down processes, impacting productivity and client satisfaction. 

• Reputation damage: System failures or security breaches due to outdated technology can harm your organisation’s reputation. 

• Difficulty attracting talent: A tech-forward company is more appealing to top talent. Neglecting technology can put you at a disadvantage. 

Technical debt can stifle growth, increase expenses, and damage your organisation’s reputation. By understanding and addressing it, you can protect your bottom line, enhance competitiveness, and position your organisation for long-term success. 

While many organisations claim to assess most or all their technical debt, and despite its importance, over half lack a formal strategy to manage it. The risks posed by technical debt often outweigh its potential benefits, and ignoring technical debt is more harmful than addressing it promptly. 

Technology leaders may find it challenging to justify additional spending on what seems like redundant work, especially if they were the ones who championed the original investment. While it’s tempting to overlook the issue, swiftly addressing technical debt is crucial, regardless of who made the initial purchasing decision or the circumstances surrounding it. 

Next Steps 

What if you can’t tackle your technical debt right now? How do you determine the best time to address it? How can you effectively communicate the need for action, assign responsibilities, and prioritise technical debt? 

Don’t let technical debt undermine your organisation. Take control of your technology landscape and unlock your organisation’s full potential. Contact us today to assess your technical debt and develop a tailored strategy for overcoming it.