Engineering Analytics

What Is Technical Debt? The Hidden Danger That’s Costing Your Business Money

Arnaud Lachaume
Michael Asiedu Link to author's LinkedIn profile
October 12, 2022
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Learn How to Identify, Prevent and Manage Technical Debt

Table of Content

Technical debt is a concept used by software engineers and programmers to describe the negative effects of making hasty or suboptimal coding decisions. Code that is laden with technical debt can be difficult to understand, hard to maintain and challenging to extend. In other words, it’s like a mortgage on your house: it might seem affordable now, but you’ll eventually have to pay back more than you borrowed. The main difference between technical debt and other types of debt is that you can’t leave technical debt unpaid and go bankrupt in the long run. Once you take on too much technical debt, your code becomes so convoluted that it’s almost impossible to refactor it back into a good state again.

A common notion in software development suited for new learners is that writing code that works first is always better than trying to write a better code that doesn't. The goal is to help new developers focus on solving problems quickly and efficiently while also boosting their motivation.. The catch is that most quick and easy solutions aren't sustainable or feasible. Most hurried solutions might not be sustainable or feasible. It is crucial to remember that, although a new developer may be able to fix a problem with simple but inefficient code, he or she risks incurring debt due to not using the best available solutions.  Stakeholders, particularly software developers, play an important role in ensuring that the best code is used in production. However, they are constantly tempted to implement simple solutions that expedite the delivery of a piece of functionality/feature that must be reworked later. Skipping some of the best engineering practices and prioritizing speed of delivery over code quality can be advantageous because software is delivered to users quickly, saving time and resources. However, the amount of rework required in the near future depends on the amount of accrued technical debt. The debt is paid simply by finishing the incomplete or substandard work. So, is it worth it to take the easier route rather than the better one? Let’s examine technical debt in more detail and its consequences.

How to Identify Technical Debt

In the early stages of shipping a feature, technical debt can go unnoticed. After all, users rave about the product, onboarding has tripled, and sales are brisk. Resolving debt often requires  a concerted effort to review the codebase and stack. . You may find yourself looking for and repairing bottlenecks while time is on your side, and in some cases, you can bring in new people to help you solve the problem.

However, some technical debt can lurk in the shadows and rear its head when the project scales or more users are onboarded. Resolving these issues can be a difficult task because they are unexpected and typically no resources are dedicated to dealing with them. As a result, the team faces a significant challenge. For example, consider a scenario where you develop software with an unknown amount of technical debt involving security, and then discover an unexpected breach or loophole. A snowball effect occurs, which has a significant impact on the team and the company because resources must be dedicated to closing that loophole and making things better in the future. You can’t risk user churn, because no one would use software that jeopardizes their data, privacy or security.

The Different Types of Technical Debt

Categorizing tech debt as minor or critical is difficult in the early stages because the software must be constantly examined before you can be certain. This means that if your feature isn't used by your intended audience, you might underestimate the amount of technical debt incurred.

Nonetheless, understanding the difference between intentional and unexpected technical debt can help you better anticipate and manage issues before or more quickly when a bigger problem may arise.  .

1. Intentional Technical Debt

Intentional technical debt is an upfront decision to suboptimally implement a feature because it provides an overall positive long-term outcome for the software project or product. Intentional is defined as "done on purpose; deliberate." Tech leaders and developers in this group deliberately incur debt as a strategic tool.

To elaborate, a beta product can purposefully leave out several must-dos in order to get the software out the door and gather customer feedback. In these cases, intentional flaws in the software, such as delaying refactoring, are expected to be fixed once enough feedback is gathered.

In this case, intentional debt is good because everything is planned with the intention of improving, adding or even changing the entire code to meet the needs of the users.

2. Unintentional Tech Debt

Unintentional tech debt, also called accidental or silent tech debt, is when you create something that’s not quite as good as it could be without intending to. Unintentional tech debt can occur in any codebase and can have significant ramifications on the quality of your final product. As the name implies, unintentional tech debt can result from poor software development. There are several common causes, such as business pressures, in which the company considers releasing something before it is ready.

On the technical side, most teams have a lot of technical debt as a result of not having a proper and suitable test suite and, more importantly, not being able to access and quantify engineering metrics.

Most unintentional tech debt stems from a more fundamental issue, such as poor technical leadership, a lack of team collaboration, or the absence of software documentation.

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3. Environmental Technical Debt 

When you create a new product, service or feature, you have to make a lot of decisions very quickly. Often these decisions are about technical implementation details like which software libraries to use, which database to target, whether to use object-oriented programming techniques or not, and so on. Many of these decisions are informed by your understanding of the trade-offs between various implementation options. Unfortunately, many projects get into trouble when they don’t fully understand the long-term implications of their initial implementation decisions. 

This is called Environmental Technical Debt (ETD). It’s that moment in your project where you realize that your current implementation has some hidden costs — and if you continue, something bad will happen sooner rather than later. . Any program must be developed and improved over time. To illustrate, a program designed to manage a company with 2,000 users is not the same as the one designed to manage a company with 20,000 users. Initially, the program may be a great fit for the business, but as it grows, several debts will accumulate. 

How Technical Debt Can Affect Your Business

Technical debt, whether intentional or unintentional, has the potential to break or cause unintended havoc in your business. 

1. Longer Development Life Cycles

Allocating resources to settle debt can cause development to take longer. On the bright side, the ideal is to build great software with an accelerated life cycle. Even though development in engineering is ongoing, in the case of technical debt, more effort is put into a single problem that could have been avoided from the start. One common misunderstanding in development is the notion of refactoring after everything has been completed. As an engineering best practice, refactoring should be done while writing the code, not after.

2. Financial Ramifications: Decreased Sales

The most important factor in customer retention is creating a great product. Unfortunately, some technical debts can influence software quality. And when your software has flaws, you can be sure that your users will find a better alternative to meet their needs.

3. Limited Innovation

No matter how thorough you are, there will always be some level of technical debt. However, the size of the debt and the time required to address it can slow down the development cycle and the velocity of the business. More resources will be directed toward older problems, limiting a team's ability to generate new ideas and innovate.

4. Compromised Security

Technical debts can also impact security and compliance. For example, failing to secure and test your APIs adequately is a technical debt that puts your entire project's security at risk. It is always worthwhile to weigh the benefits and drawbacks of certain decisions to ensure they don't resurface in the future.

Technical Debt in DevOps

DevOps practices are a tried-and-true method for eliminating or reducing technical debt. Inadequate incorporation of DevOps practices has always been a suboptimal method of project management.

Furthermore, the value of DevOps cannot be overstated because it serves as a communication tool between the technical team and the company. When done correctly, practices such as running tests, tracking engineering metrics, and performing regular code checks can significantly reduce the magnitude of debts.

As a common software engineering approach, continuous delivery can easily be combined with DevOps practices because it deals with the production of software in short cycles. 

This combination ensures that the release process can be automated and that software can be released reliably at any time.

How to Get Out of Technical Debt 

When technical debt rears its head, you must accept responsibility to deal with it.

1. Measure the Impact of the Debt

The first step in debt resolution is to determine the cost of the debt by looking at the project's performance. This also serves as the first attempt to determine how to address the problem, identify the resources to devote to the problem, and assess the expected impact on overall business goals.

2. Have a Good Team of Software Engineers

When there is a technical debt to be addressed, you must have competent problem-solvers on your team. In an attempt to deal with debt, the last thing you want is the creation of new ones by inexperienced engineers.

The team must also understand the various principles that not only solve a debt but also best improve the overall product.

3. Identify What’s Important, Urgent or Both 

The most crucial aspect of planning and dealing with multiple problems is to determine how to allocate resources to address them.

Not all problems require the same level of effort to solve. Some debts require immediate attention, whereas others are important but not necessarily urgent. It is critical to understand how and when to address each and every problem in a project.

4. Constantly Access and Review Your Codebase

The only way to get out of technical debt is to recognize that you have one. Building and shipping are only the first steps in product management. Much effort should be expended to improve the product as it ages. Furthermore, this step provides a thorough understanding of the project and how specific things work. Attempts to deal with technical debts in the future become less of a headache.

Keypup’s Software Quality Metrics Template 

Today’s digital landscape is more competitive than ever, making it challenging for businesses to stand out from the rest of the pack. Fortunately, leveraging software quality metrics can help you achieve the differentiation you need to thrive. Keypup’s software quality metrics template provides insights on your product health such as your refactoring ratio, your raised bugs by severity, and the time elapsed from a raised bugs until its resolution. Monitoring these metrics allows you to manage your technical debt and make data-driven decisions to prioritize the team’s effort. 

Share your technical debt management tips with us on Twitter or try Keypup today to keep track of your technical debt.