Learn about the negative impacts of technical debt

What is technical debt?

Technical debt is the costs resulting from delaying issues that will negatively impact a company later. The issue often arises in software development.

Causes of technical debt include poor architecture, skipping steps in the software development process and failure to test. For example, the pressure to quickly demo software and get feedback from users can lead to the accumulation of technical debt. In response to that pressure, developers might take coding shortcuts, intending to rewrite the code once they fully understand the requirements. However, time constraints might cause the project leader to skip rewriting the code and move forward with developing requested features over a poorly written code base.

Similarly, major technical debt will accrue if project teams allow too many deficits on the systems they build. This debt can have significant long-term effects on the company.

Here's what CIOs and IT leaders should understand about the negative impact of technical debt.

7 types of technical debt

Various types of technical debt can substantially affect the development, maintenance and success of a company's projects and products. Tech debt comes in many forms and can include the following:

• Architecture debt. This type of debt occurs when a system architecture is poorly carried out or incomplete. For example, architecture debt might result from senior technical staff failing to define the system's overall architecture and the way it will work together.
• Code debt. Code debt occurs when issues with the written code make it difficult to maintain the app. For example, this type of debt might accrue if developers cut corners or follow poor software development practices.
• Documentation debt. Documentation debt can occur if documentation is not written and updated throughout the software development process. For example, a company's current software developers might not understand why previous developers chose to code a certain way if thorough documentation does not exist. The lack of documentation would lead to current developers spending additional time and money.

• Environmental sustainability debt. Environmental sustainability debt occurs when a system is deployed with technical debt and a company overinvests in certain areas to keep the application working because of demand, as when millions of people use popular social media applications or search engines. For example, the company might need a larger data center facility, leading to the acquisition of more hardware and software and the generation of e-waste, among other environmental issues.
• Infrastructure debt. Project teams incur infrastructure debt when they fail to maintain or upgrade the infrastructure required to run their company's systems. For example, a team might put off replacing an out-of-date server, which creates future debt and increases the company's risk of a hardware or software failure, which can potentially affect employees and customers.
• Process debt. Process debt occurs when teams neglect certain steps in a project. For example, a team might skip a step when refining requirements for an application. Critical process steps, such as a code review and final test, can help ensure everything is in order before the team pushes the code to the production site.
• Testing debt. Developers accumulate testing debt by releasing an application without carrying out sufficient testing. Neglected testing might include manual tests performed by the software developers and the software test team or through a more efficient automated testing process.

15 negative impacts of technical debt

Technical debt can affect every aspect of a project's development and a company's long-term success. CIOs and other IT leaders should plan how they will avoid the following potential negative consequences of tech debt before they take on a new project.

1. Poor user experience

Employees might encounter trouble performing their tasks because of tech debt. These challenges can lead to poor customer service as well as negative employee sentiment because of frustration over the problems. Data errors could also occur because of employees' difficulty using the software.

2. Unplanned costs

Technical debt issues might cause a company's CIO to use funds to maintain the system that the CIO had reserved for future projects. The CIO might then need to delay other projects or scale them back until the company secures additional funds, which could result in deadline and staffing issues. The project's proof of concept can help establish requirements from the start.

3. Loss of reputation

Technical debt can lead to a system malfunction, and users and other key stakeholders might become frustrated with the time required to carry out bug fixes if they are unable to use the software for a long period of time. Malfunctions could negatively affect a company's reputation.

4. Adverse effects on system performance

Technical debt leads to problems with system performance, which requires team members to spend time fixing the issue and leads to periods of system downtime. This process is even more difficult when a team must resolve multiple issues. For example, a team might need to refactor code before addressing performance problems.

5. Delays in assisting users

Tech debt can lead to various system problems, causing employees to file tickets with their IT team and potentially leading to a large backlog of user issues that IT needs to resolve. Delays could lead to employee frustration, and IT might end up needing to create a new process to triage tickets and provide users with updates.

6. Rise in staffing costs

The CIO might need to hire extra staff to fix tech debt issues in legacy systems. New employees will incur additional costs and will create extra tasks for many departments within the company, including the recruiting team; IT, who will need to find equipment for the new hires; and facilities employees, who will need to find space for the employees.

7. Delays in staffing changes

Companies often move development team members to new projects once their previous assignment ends, and unaddressed technical debt could delay these moves. Postponing staff changes can lead to issues such as delayed deadlines and budget challenges for other projects.

8. Extra concerns for senior management

Technical debt might require input from senior management, particularly if the tech debt affects customers, vendors or other third parties. Senior management needing to deal with tech debt-related issues might lead to delays in other areas of company operations because senior management must wait to address them.

9. Difficulty adding new features

Accumulated technical debt can limit a team's ability to implement new or updated features. For example, employees might want to implement artificial intelligence or GenAI features into the system, but tech debt might make those changes difficult to carry out, leading to employee frustration.

10. Compliance risks

Technical debt might lead to compliance issues, such as not meeting protected health information regulations or failing an ISO audit because of a lack of documentation or application issues. The company will face the consequences of not being compliant and will likely need to fix the issue quickly, which the software development team might struggle to do if a large amount of tech debt exists.

11. Cybersecurity weaknesses

An application with a large amount of technical debt can be vulnerable to cybersecurity intrusions. Finding and fixing the security weaknesses can be challenging and could lead to the introduction of new issues. In addition, accrued technical debt might result in reduced system functionality, leading to frustration for users. Users might resort to introducing unsanctioned apps through shadow IT or using manual workarounds to address the system's shortcomings, which can lead to major security concerns.

12. Difficulty upgrading

Poorly written code or limited documentation can lead to tech debt, which will complicate the process of upgrading a system. The team might need to test the upgrade process first, including confirming that the data is undamaged, and that the existing functionality continues to work with the new software. Carrying out this testing requires additional time and money.

13. Duplicate code

Tech debt might lead to duplicate code, which would require more than one fix or editing to resolve the issue. In some cases, the team might not realize the extent of the issue and only fix one instance of the duplicated code, leading to unresolved problems that the team will have to address later.

14. Low developer morale

Working on an application with a large amount of technical debt can lead to low morale on the software development team. Others at the company might criticize the team if issues take longer to fix than expected, and project team members might feel dissatisfied with their job if they're tasked with updating obsolete code or working with poor documentation instead of working on new features or building new applications. This discontent might cause employees to look for other jobs.

15. Difficulty integrating with other systems

Business environment applications are almost always integrated with one or more additional apps, such as single sign-on. Configuring these integrations might be difficult or almost impossible without addressing the tech debt first, leading to additional issues for the software development team and delays for the rest of the company.

Eric St-Jean is an independent consultant with a particular focus on HR technology, project management and Microsoft Excel training and automation. He writes about numerous business and technology areas.