Sema Blog

Measuring the Impact of Technical Debt

Posted by Sara Haynes on Oct 5, 2018 5:30:00 AM
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The Sema team has spent the last year interviewing software development leaders in organizations of all types: Fortune 500 companies with decades of legacy code; start-ups who accrued tech debt as they moved quickly to grow their business; private equity-owned companies that acquire multiple new tech properties a year; and outsourced development shops who track every line of code written.

Different types of organizations experience unique challenges, but the biggest variable is familiarity. If development leadership is deeply familiar with the codebase and the team, they may feel that there are fewer surprises waiting for them. In contrast, leaders with multiple teams or new projects struggle to understand the scope, severity, and causes of their technical debt.

For these organization, simply gaining visibility into their challenges provides immediate benefit. However, even when the issues facing a team are fully understood, technical and business leadership struggle to identify and evaluate ways that code and architectural quality issues impact not only development teams but the entire organization. This, in turn, makes it difficult to make a cost/benefit determination on costly and open-ended refactoring and process improvement initiatives.

"When you are able to pinpoint the moment when things started to change, that is very valuable data."

In order to help leadership teams understand the full impact of technical debt, Sema has developed a calculator that considers both development time and cost, and also wider organizational impact. Below is a summary of the factors our team has uncovered in our research.

Cost and Resource Management

  • Controlling Maintenance Costs: Companies that are forced to move a large percentage of their development teams to maintenance activities find themselves with limited budget or resources left for innovation.
  • Tackling the Big Refactoring Project: When organizations decide to move forward with refactoring initiatives, they struggle with accurately estimating the duration, scope, and value of the project.  And even with their best efforts at estimating and planning, many of these projects are just too costly.

Strong Teams

  • Maximizing Resources: Particularly in larger organizations, leveraging developers effectively across teams is a challenge. Managers need help to accurately assess the skills and knowledge of each team member for the best allocation of development resources.

“Understanding the quality of changes per developer would be Incredibly game-changing useful.”

  • Improving Retention: Developers like new challenges, and being trapped on a refactoring project with no end in sight is a good way of losing developers. Reducing turn-over by ensuring that refactoring projects have clearly defined goals and timeframes helps keep morale high.
  • Seeing into the outsourcing black box: Companies with outsourced development often feel they aren't getting the most out of their contracts, but lack the visibility to assess the output and quality of the outsourced team.

Strategic Impact

  • Customers and Sales: In many companies, cross-functional support for refactoring initiatives happens only when other business challenges can be linked to technical debt.  Potential impact includes, customer satisfaction, support call volume, renewal rates and sales uplift.
  • Acquisitions: when companies make an acquisition, it is with the expectation that the benefit of the purchase will be realized in a certain period of time. Hidden technical debt can alter roadmaps, market strategy and more, wreaking havoc with time-to-value expectations. 

Leadership teams need tools that help them make the connection code quality and business goals, evaluate the impact refactoring may have, then set - and meet - realistic goals for architectural and code improvement.

Any of these sound familiar? Contact us at to try  our ROI calculator and learn more about how Sema's solutions can impact your business.

Topics: Refactoring, tech debt, software maintenance