As customer expectations continue to rise, companies of all sizes feel immense pressure to continuously enhance their organizations to compete in today’s competitive marketplace. While large companies have the resources to boost customer experience by improving their existing technology or investing in new technologies, smaller companies often face budgetary restrictions. For small companies with antiquated systems and/ or systems that are difficult to enhance, growing technical debt often becomes a huge issue as they struggle to keep pace with their larger competitors.
Oftentimes, small companies attempt to improve the ‘top line’ to cover up deficiencies in their IT portfolio. Their impressive persistence can be seen throughout any industry and time period; however, the notion “if it ain’t broke” does not apply to IT systems. The expense associated with keeping a system up and running grows linearly with the age of the system. Below is a rudimentary example that uses cross-industry averages:
|Annual Support Year 1||25|
|Annual Support Year 5||75|
|Annual Support Year 10||150|
|Annual Support Year 20||300|
*these estimates also include a 3.5% inflation factor
In the above example, if the implementation costs of a non-descript, user-facing system are 100 units, the support of that system costs approximately as much as the full implementation itself, before the 10th year of operation. It is also important to note that the above example does not include the expertise necessary to maintain nor support the system, which increases exponentially as technical “talent” becomes more costly and difficult to find and maintain. One instance where this is applicable is with a system built and support on mainframes. As “mainframe” is no longer taught at the collegiate level, companies with this setup would need to assess the possible implications of that waning skillset, such as scarcity and cost of resources.
Many small companies have difficulty spending the necessary resources, whether that be personnel, cash or time, to address technical debt. BlueLine Associates has had great success partnering with businesses of all sizes to gain the maximum benefit from their IT portfolios. On average, BlueLine has saved its customers 300-400% of the cost of the offered services (process and information management assessments and fix implementations) and established frameworks for clients’ current and future successes.
With the significant and consistent potential of return on investments associated with continuous improvement projects addressing technical debt, no company should feel that they cannot afford to keep up or stay ahead of evolving technical needs and requirements.