Why Removing Technical Debt is Critical to Energy Organizations

As the Energy Industry pushes towards Industry 4.0, we’ve already undergone three previous digital “revolutions.” Over that time, organizations accumulated technologies that likely weren’t updated, retired, or expanded to the latest capabilities. In asset-intensive energy organizations, this phenomenon is amplified due to departmental preferences, operational silos, and non-standard development practices that create sub-optimal customizations. These inefficiencies lead to a backlog of technical debt that impacts the availability, performance, and security of software solutions.

In turn, technical debt impedes the overall flexibility and resources of energy organizations, making it more difficult to reach energy transition goals. Put simply, clearing up your technical debt makes your assets and applications work better for the present and the future.

What is Technical Debt?

Technical debt is typically defined as the measure of the cost of reworking a solution caused by choosing an easy-yet-limited solution. In fact, three kinds of debt can occur:

1. Debt from time pressure: Identifying and solving a business problem with technology is always important. However, corners are often cut to patch a problem, rather then developing a long-term solution.
2. Debt from constant change: Expectations are ever-changing. Right now, we are seeing the rise of new market opportunities, emerging cyber threats, and IT turnover creating challenges for business leaders.
3. Debt from outdated technology: Developing modern applications typically involves several coding languages, developer frameworks, and libraries, which can become obsolete or not supported.

At this point you may think, “So what? My applications work, my teams are happy, and the business is running.” What may not be visible to leadership outside of IT is that technical debt also has a direct impact on the bottom line. Not only can removing debt increase availability, performance, security, and reliability—it can also help you save real dollars. But how can you calculate it?

Step 1. Establish a baseline of technical debt costs:

• How much does it cost to maintain current software?
• How many person hours are being spent on maintaining that software?
• When was the last time an application or platform was upgraded to the latest version?
• What is the real dollar value that the application is supporting for the business?
• How has the application(s) been performing since purchase or creation?

Step 2. Measure technical debt in “unplanned work”:

• Bug fixes, service interruptions, or flawed design
• Identify where capacity is being stolen
• Remove elements that are causing reactions

Step 3. Set capacity target and uncover root cause:

• Quality of code versus relevance
• Alignment between business and IT
• People efficiency losses

Step 4. Measure outcomes:

• Percent of unplanned events removed
• Employee efficiency and morale
• Quality of software
• Dollars saved

Now that you are visualizing the potential impacts of technical debt on your organization, add in the elements of availability, performance, and security.

Availability of your critical applications and systems is directly affected by the amount of technical debt that they carry. As new versions of applications are released by software vendors, they often come with patches, new underlying technology to support functionality, and best practices to get the most out of your investment. In as soon as one year, applications can fall behind architecturally and lose availability—decreasing the value your IT teams and end users receive.

Performance and availability go hand-in-hand. Aspects of software such as drivers can impact performance of graphics or video outputs, while other elements can impact UX/UI. The upgrade process, which may occur with a single click of a button or a push from a vendor, can dramatically reduce risk of crashes and lag—while increasing processing speeds.

Security is perhaps the biggest topic on the minds of leaders in the energy space. The longer a software stays in the market, the more time bad actors can exploit weaknesses. Targeting vulnerabilities in a program or system can allow for potential malware that gives those bad actors access to your most critical information. With upgrades and removal of technical debt, vulnerabilities are corrected, patched, or identified—helping you to limit your risk.

As energy organizations advance both Industry 4.0 and energy transition goals, every asset and technology you rely on must operate at optimal levels. Addressing your technical debt offers short-term and long-term benefits. Ensure you’re running the most upgraded and secure versions of your software to save time, staff resources, and costs – and get the most value from your technology investments.