What is Technical Debt?

Technical debt refers to ineffective and/or redundant technology systems that incur costs without equal returns or benefit to their organization, and which in fact hampers IT agility and slows business progress. Examples include legacy LDAP directories, custom applications, non-standards-supporting solutions, and immature security software. Technical debt is often difficult to evolve or replace and expensive to maintain–but remains in the architecture due to tightly coupled services and processes that rely on it.

How does Technical Debt impact the organization?

Technical debt includes more than just the cost of the infrastructure component itself, but also the time and labor devoted to working with or around the system. Every minute spent maintaining the tech debt, or working around it, incurs more debt and represents opportunity cost of time better spent on higher-value projects. Outdated systems are a burden that slow transformation, and hold the organization back from taking advantage of modern technologies. They result in a poor user experience (both for workforce and customers). Tech debt even presents a security challenge, as outdated security approaches increase risk. And of course, there are costs associated with upgrading from end-of-life solutions.