The challenges of technical debt and its impact on organizations


69% of IT managers identify technical debt as a major threat to their company’s ability to innovate, according to an OutSystems report.

With COVID-19 exposing vulnerabilities in organizations around the world, this latest industry survey from OutSystems examines the cost of technical debt facing businesses across industries and geographies.

“The combination of old code with the new generation of mobile apps, stack apps and the expansion of SaaS robs organizations of resources, time and ability to innovate,” said Paulo Rosado, CEO of ‘OutSystems.

“This report proves that technical debt will continue to worsen and requires a new approach to overcome it and innovate at a pace and scale for true competitive advantage.”

A major obstacle to innovation and recovery

As companies struggle to rebuild themselves from the challenges of the past year, technical debt has become a major obstacle to innovation and recovery, especially for growth-oriented companies.

Technical debt is a technical design or development choice made for short-term benefit with long-term consequences. Across industries, this results from developing solutions that are implemented quickly to maximize speed, rather than optimize for the future.

Based on a global survey of 500 IT executives, the report sheds light on the challenges businesses face in dealing with the many causes of technical debt, including pressure to meet deadlines, the ever-changing market, and technology obsolete.

The many obstacles of technical debt

  • 69% of IT leaders say technical debt fundamentally limits their ability to innovate, 61% say it hurts their business performance, and 64% agree that it will continue to have a major impact in the future.
  • There is a huge opportunity cost for companies of all sizes in all industries as they spend time, money, and other resources on technical debt instead of innovation. On average, businesses spend about one-third of their IT budget on technical debt – this figure rises to 41% for businesses.
  • There is no single cause for technical debt, although IT managers cite too many development languages ​​/ frameworks (52%), revenue within the development team (49%), and accept defects known to meet publication deadlines (43%).
  • Companies continue to delay processing technical debt, further compounding the problem. Only 20% say tech debt is something they manage well now, although 36% say they will be able to manage tech debt in the future.
  • Technical debt gets worse as businesses grow. Businesses spend 41% of their IT budget on technical debt, while small businesses spend 27%.

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