Executive Summary
Organizations want to get as much done as quickly and cheaply as possible, but rushing initiatives like digital transformation projects may have a hidden cost. Sometimes technology decisions are accelerated, and short-term savings on the cloud, infrastructure, software, and services are leveraged to get the project launched quickly. But this often means that a tradeoff occurs between the long-term alignment to organizational goals and short-term reaction to current pressures.
Changes made in the name of expediency often result in business requirement oversights, software development shortcuts, and customer experience shortfalls. This leads to Technical Debt, creating longer-term technical challenges as an unintended consequence of short-term thinking. Similar to financial debt, we often borrow to accelerate what we can’t afford and leverage financing to acquire assets sooner versus later. But borrowed money comes at a cost, requiring you to pay interest on the borrowed funds. Over time, unpaid interest can accrue, compounding to a rather large sum if you are not careful, and eventually you must repay the principal. This same concept impacts the effectiveness of technology when decisions are made with a rush to market and short-term considerations, taking priority over long-term alignment between technology and business goals.
ESG analysts analyzed the impact of technical debt and quantified the impact of making decisions that can accrue technical debt. ESG believes that organizations that choose to prioritize “Rush over Rightness” in technology investments realize higher costs for refactoring, higher total cost of ownership (TCO), an impact on productivity and especially innovation, as well as incurring significant limitations in agility, security, maximized revenue, and customer satisfaction.
