Technical debt in the context of enterprise risk and resilience automation refers to the accumulated challenges and costs that arise from quick-fix solutions, budget overruns, and extended implementation timelines. This debt becomes particularly problematic when using platforms like ServiceNow and Salesforce.com, which, while modern, often lead to significant technical debt if not managed properly. Legacy systems such as LDRPS, Archer, and MetricStream have already demonstrated the long-term pains of technical debt, and the same pitfalls can be seen with newer platforms.
What is Technical Debt?
On average, technical debt consumes around a quarter of all IT budgets annually. Companies strive to maintain their competitive edge by rolling out software updates and new features quickly. However, market and internal pressures, including budget overruns and extended project timelines, often lead to rushed implementations. This results in developers opting for easy, short-term solutions that lead to incomplete updates and poor documentation, creating technical debt that requires ongoing rework and fixes.
The Financial Analogy
Technical debt operates like a financial loan with interest. Short-term solutions achieve immediate goals but accrue “interest” in the form of increased complexity and future work required to maintain and fix the implementations. This leads to compounding issues over time, as developers continually refine and fix poorly documented and structured code.
Key Statistics Highlighting Technical Debt
IT Budget Impact: Over 20% of the technical budget for new products is diverted to resolving technical debt issues (McKinsey).
Revenue Growth: Organizations in the top percentile for managing technical debt see 20% higher revenue growth compared to those in the bottom percentile (McKinsey).
Project Completion: Organizations with high technical debt scores are 40% more likely to have incomplete or canceled IT modernizations (McKinsey).
Developer Time: 33% of engineers’ time is spent dealing with technical debt, equating to about 13.5 hours per week (Stripe).
Infrastructure Complexity: 44% of organizations say technical debt built up over time as their infrastructure became more complex (SoftwareAG).
Rising Technical Debt: 78% of companies saw an increase in technical debt in 2021 (SoftwareAG).
Priority on Speed: 64% of organizations prioritize fast-tracking new product launches (SoftwareAG).
Causes and Business Impact of Technical Debt
Common Causes
- Lack of Long-term Vision: Business leaders often underestimate the long-term implications of rushed implementations.
- Rushed Releases: To meet market demands, companies release software updates/features prematurely.
- Inflexible Integrations: Short-term, point-to-point integrations fail to adapt to evolving business needs.
- Lack of Testing: Inadequate test suites lead to risky, quick fixes.
- Poor Documentation: Ignoring documentation requirements creates future complications.
- Inexperienced Developers: Lack of training and knowledge sharing results in poor coding practices.
- Delayed Refactoring: Postponing refactoring leads to growing technical debt.
- Siloed Development: Isolated changes necessitate additional rework and increase technical debt.
- Insufficient Testing: Rushed deadlines push out faulty code, requiring extensive bug fixes.
- Budget Overruns: Extended implementation timelines and budget overruns force teams to take shortcuts, leading to incomplete solutions and increased technical debt.
Business Impact
- IT Delivery Gap: Technical debt widens the gap between IT capacity and business needs, hindering innovation and market responsiveness.
- Increased Total Cost of Ownership (TCO): Maintaining outdated systems and technologies significantly raises the TCO, diverting resources from other opportunities.
How CLDigital Solves for Technical Debt
- Seamless Integration with Deployed Solutions
CLDigital’s platform is designed to work seamlessly with existing deployed solutions, filling automation gaps and ensuring continuity. This approach minimizes the need for extensive rework and helps reduce technical debt.
- Addressing Gaps in Automation
CLDigital identifies and addresses gaps in existing automation processes. Our no-code platform allows for rapid deployment and customization, ensuring that all aspects of enterprise risk and resilience management are covered comprehensively.
- Promoting Good Coding Practices
CLDigital emphasizes thorough testing, code reviews, and adherence to best practices, ensuring high-quality code and reducing technical debt.
- Prioritizing Customer Needs
By focusing on customers’ core needs, CLDigital ensures that solutions are scalable and flexible, avoiding the pitfalls of short-term, rushed implementations.
- Automated Testing and Integration
CLDigital uses automated testing tools and well-planned integrations to identify and fix bugs efficiently, ensuring that systems remain flexible and scalable as business needs evolve.
- Seamless Data Integration
CLDigital offers robust data integration solutions, ensuring real-time data transfer and eliminating silos. This enables teams to work with unified data, providing meaningful insights and reducing the impact of technical debt.
Conclusion
Technical debt in enterprise risk and resilience automation can severely impact an organization’s ability to innovate and remain competitive. By understanding and addressing the causes of technical debt, and leveraging CLDigital’s advanced, no-code platform, organizations can minimize these challenges, ensuring long-term sustainability and success. CLDigital’s ability to integrate with existing solutions and fill automation gaps makes it a critical tool for managing and reducing technical debt.