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Technical debt – have you factored in its economic impact?

With economic unsertainty looming, IT teams are faced with ensuring they are optimising their budgets for the upcoming year.

 For IT teams, understanding the importance of reducing technical debt, also known as ‘tech debt’, or ‘design debt’, is crucial for making strategic decisions that optimise IT operations, improve financial resilience, and position organisations for long-term success.  

 In this article,  our Principal Engineering Consultant, Dennis Baltazar explores technical debt – how to manage it while minimising the impact on your systems. 

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What is Technical Debt?   


Technical debt is a metaphor coined by Ward Cunnigham, creator of the first Wiki. This phrase refers to the ‘expenses’ that arise when developers face challenges during the software development process. This may be driven by business pressures, development processes, inexperienced teams, or changes in technology requirements. It represents the outcomes of expedited decisions, which can lead to additional effort, decreased efficiency, and heightened maintenance needs.

It involves trade-offs between short-term gains and long-term consequences. Over time, it accumulates and decreases the overall quality of your software. This manifests as decreased efficiency, higher maintenance effort, and reduced code quality – which can in turn impact the bottom line. 

While it doesn’t involve a monetary repayment obligation like financial debt, just like financial debt, it needs to be serviced and paid off. The good news is that it can be proactively managed in most cases without the need to replace an entire system.  

By implementing incremental changes and establishing a robust process to understand and remediate the drivers of your debt, you can gradually reduce it.  

Next > Tips to manage your debt

Reduce technical debt

manage your debt

Effective Management of Technical Debt

Let’s explore some practical tips to help you reduce technical debt effectively

Understand and prioritise

Identify areas in your codebase that have accumulated technical debt, such as outdated libraries, inefficient algorithms, lack of documentation, or poor code structure. These issues often arise due to evolving technology requirements or rushed development cycles. By addressing this, organisation’s can improve their software systems' performance, responsiveness, and reliability, enabling them to quickly adapt to market changes and gain a competitive edge.

Refactor code

Improve code readability, maintainability, and extensibility by restructuring existing code without altering its external behavior. Focus on improving the most critical and problematic areas first, such as sections that have undergone numerous patches or modifications over time. By doing so, you improve long-term stability and longevity of your software systems, providing a solid foundation for future growth and recovery.

Automate testing

Implement a comprehensive suite of automated tests, including unit tests, integration tests, and end-to-end tests. Automated tests help identify issues early, prevent regressions, and ensure code changes don't introduce new bugs. Lack of automated testing may result in undetected bugs, slower development cycles, and increased maintenance efforts. By automating, you also have effective resource allocation and better return on investments.

Update dependencies:

Regularly review and update your project's dependencies to their latest stable versions. Outdated dependencies can introduce vulnerabilities and limit your ability to leverage new features and bug fixes. Failure to update dependencies can lead to security breaches, compatibility issues, and missed opportunities for performance optimisations. By updating dependencies, you mitigate these risks, ensuring systems are more resilient, secure, and adaptable to changing circumstances.

Improved documentation

Lack of documentation often stems from time constraints, frequent changes, or a lack of emphasis on proper documentation practices. Take the time to document your code, APIs, architectural decisions, and other relevant information. Inadequate documentation can hinder the understanding and maintenance of a codebase. Improved documentation enhances code understanding, facilitates maintenance and enables effective collaboration, leading to improved productivity and efficiency.

Foster continuous improvement

Technical debt accumulation can result from stagnant processes, change resistance, or a lack of awareness about the long-term impact of shortcuts. Therefore, cultivating a culture of continuous improvement within your IT teams is critical. This is achieved by encouraging open discussions about technical debt and empowering IT teams to take ownership in reducing it. This may require training opportunities to address any knowledge and process gaps. Continuous improvement will increase operational efficiency, and ultimately streamline development processes, enhance code quality, resulting in more efficient and effective operations.

Scheduling a ‘debt sprint’ 

It is crucial to ensure your IT team is well-equipped to handle these efforts. To effectively address technical debt, allocate dedicated time in your development schedule specifically for tackling it. Consider implementing ‘debt sprints’ or allocating a percentage of each sprint to address debt.  

If you’re unsure about how to approach your technical debt, consider hiring a trusted DevOps consulting company like Avocado. Our experts provide tailored solutions, leveraging the latest tools and industry best practices. We help you effectively manage technical debt and optimise your software development processes and services.

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Take control of your technical debt and maximise the value of your IT budget. Contact Avocado Consulting today for expert DevOps solutions and ensure the long-term success of your software projects.  

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