How to Manage Data Debt for Accelerated Digital Transformation

Defined here data debt and how to manage it when preparing for digital transformation

Data debt is a term based on the concept of technical debt. Also called technical debt, a word from the world of Agile software development. Technology debt refers to the cost of deferring a software feature or choosing a quick and simple solution instead of a more thoughtful solution that would take longer to achieve. The Data Governance and DataOps disciplines will serve as instruments to repay the data debt and thus reduce it to a large extent.

The concept of data debt can be used as a powerful argument in discussions with key stakeholders to drive new business processes and policies related to data. Data debt should be seen as part of a transformation journey to realize benefits. Digital transformation is a necessary step for companies that want to strengthen their capabilities and differentiate themselves from the competition. Digital transformation should not be locked in without considering another type of data asset.

Data debt and digital transformation:

Digitizing a business can be a complex process. The goal of digital transformation is to be more agile, flexible, customer-centric, or automated. Data debt does not lead to results or allow some of the more useful options such as digital twins or artificial intelligence to work.

Technical debt is complicated. Incomplete data only leads to making decisions with an incomplete picture of where the organization stands, failing to deliver the expected results, or worse, developing strategies that result in losses. It’s data debt. This can happen when companies take shortcuts or create workarounds to deal with bad data.

All of these problems lead to an unhealthy data ecosystem. This results in data debt. It wastes time, costs money, undermines decisions, causes platform stability issues or outages, and can render advanced technology useless.

Hindrance to digital transformation:

Any digital transformation strategy must consider technical debt. Technical debt is the price a company pays for short-term technological fixes. This hampers their ability to innovate and adapt to the digital age. This can greatly hamper an organization’s pace of innovation.

Technical debt increases and imposes additional fixed operating costs on the business, diverting valuable investments in innovation and new capabilities. Technical debt is common for products, especially during a digital transformation. And it’s important to make sure it’s kept under control. Otherwise, it becomes too difficult to rectify, like a snowball rolling downhill, constantly growing in size and picking up sticks and pebbles along the way.

Technical/Data Debt Issues:

Technical debt can pose different problems because the complexity of the code has led to new defects in the product. The code can also be very difficult to understand and the process of adding new features often takes time, which adds to the challenge.

Some organizations have multiple legacy products to upgrade or a large product that needs to be split into multiple microservices. Other times, the duplicate code needs to be updated or changed in multiple places to fix the problem. Organizations find it difficult to safely remove obsolete libraries or experience performance issues due to the high impact of change. To avoid these extreme consequences, they must take full control of the technical debt.

Work around technical debt issues:
  • Align IT and business strategy to clarify the overall business strategy and define the capabilities needed at the enterprise level.
  • By prioritizing automation and elevating human innovation, time and resources can be freed up so organizations can focus on building a culture of innovation and enabling long-term thinking to drive revenue growth.
  • By choosing flexible consumption models that allow them to pay only for what is consumed and preserve budgets when workloads are bound to fluctuate.
  • Organizations focused on delivering short-term projects will not be able to reduce growing technical debt.

Conclusion: Data is essential to digital transformation. Ignoring data debt will not only affect daily operations, but will also increase as your data volume grows. If data debt is reduced, cutting-edge technology will open up, attracting good staff, happy customers, competitors moving away, and therefore having a healthy bottom line.

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