6 years, 2 months ago

Exposing Technology Debt

Link: http://cisr.mit.edu/blog/blogs/2014/12/09/technology-debt/

Do you know the size of your technology debt? Technology debt is the total cost to your company of replacing outdated or unsupported technologies or systems that were poorly architected.

Most IT people know about technology debt, but their non-IT partners are rarely aware of the size or urgency of the debt. Few try to measure it. So when it’s time to replace a system or explain why the company should spend money to fix a system, nobody wants to pay for it. This is dangerous because if a company doesn’t pay off its technology debt, the costs of running and maintaining systems will climb and the risk of failure will grow.

It’s time to expose your technology debt. While you can’t avoid technology debt, here are five things companies can do to get a better handle on the situation:

  • Monitor technology debt by identifying what is out of date or will go out of date, and create a 3 –5 year plan to retire or replace the greatest sources of cost or risk.
  • Track all operating costs against the products and processes they support. Tools like Apptio can help highlight where the costs of running a system can’t be justified by the benefits they generate.
  • Establish a roadmap of capabilities the company wants. This helps identify opportunities to replace old and out-of-date systems with better technologies.
  • Create an infrastructure renewal, managed by the CIO, to fund ongoing retirement of technology debt.
  • Become more serious about using the public cloud. Software as a Service builds updates into annual operating costs, whereas companies must make significant investments when licenses for key software becomes obsolete.

As companies become more digital, they can’t afford to take on more technology debt. What is your company doing to limit your debt?

Jeanne W. Ross is director and principal research scientist at MIT CISR. In a related video—“Technology Debt”—Mihir Shah, Chief Technology Officer at Fidelity Investments Asset Management, describes both how technology debt is generated and how to pay it off.