Technical Debt

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What is Technical Debt?

Technical debt is a concept in programming that reflects the extra work required when developers choose an easy short-term solution over the best long-term approach. Like financial debt, it incurs interest in the form of increased maintenance costs and complexity over time.


Technical debt is commonly associated with extreme programming (XP) and the need for refactoring. Refactoring involves restructuring existing code to improve its quality, not just fixing poorly written code but also adapting to an evolving understanding of the problem and its solution.

Ward Cunningham, a programmer known for developing the first wiki, coined the term “technical debt” in 1992. This metaphor equates software development to financial debt.

Ward Cunningham describes this concept as follows:

“Shipping first-time code is like going into debt. A little debt speeds development so long as it is paid back promptly with a rewrite. Objects make the cost of this transaction tolerable. The danger occurs when the debt is not repaid. Every minute spent on not-quite-right code counts as interest on that debt. Entire engineering organizations can be brought to a stand-still under the debt load of an unconsolidated implementation, object-oriented or otherwise.”

Technical debt may also be known as code debt or design debt.

What is Technical Debt?

Key Takeaways

  • Technical debt reflects extra work from short-term solutions over long-term ones.
  • It can result from skilled programmers under unrealistic constraints.
  • The Technical Debt Quadrant helps teams understand and manage their technical debt.
  • Accidental technical debt arises from unintentional issues, like lack of knowledge.
  • Agile helps manage technical debt through continuous improvement and feedback.

How Technical Debt Works

Imagine a project with two options: a quick and easy solution that requires future modifications and a better-designed solution that takes more time to implement. Choosing the quick approach is like incurring debt; it comes with the obligation of interest in the form of extra work in the future. Refactoring is like paying down the principal, reducing future interest at the cost of short-term effort.

Technical debt is not always detrimental. Like financial leverage, quick solutions in software development can help a company accelerate time to market. Additionally, technical debt is not just poor code; it can result from good programmers working under unrealistic constraints.

Types of Technical Debt

The definition of technical debt is largely a metaphor, leading to various ways to classify its types. Different versions arise from specific projects and unique challenges faced by developers in their respective fields.

Types of Technical Debt

One notable classification is the Technical Debt Quadrant, a concept introduced by Martin Fowler that categorizes technical debt into four types based on two dimensions: deliberate or inadvertent, and reckless or prudent. This framework helps teams understand the nature of their technical debt and make informed decisions about managing it.

Reckless and deliberate
Teams knowingly take shortcuts without considering the consequences (e.g., “We don’t have time to think about this now”).

Reckless and inadvertent
Teams inadvertently create debt due to a lack of knowledge or experience (e.g., “What’s layering?”).

Prudent and deliberate
Teams intentionally incur debt, understanding the trade-offs and planning to address it later (e.g., “We must ship now and deal with the consequences later”).
Prudent and inadvertent
Teams unintentionally create debt despite their best efforts, often due to unforeseen issues or changing requirements (e.g., “Now we know how we should have done it”).

Technical Debt Impact on Business

Technical debt can negatively affect various aspects of a business.

Here are the key impacts:

  • Harder to adapt to changes.
  • Increased frustration/burnout among developers.
  • Increased maintenance costs for fixing systems.
  • More bugs, lower overall quality.
  • Poor user experience affects retention.
  • Slower development due to time spent resolving issues.

How to Manage and Reduce Technical Debt

Agile Software Development is a lightweight software engineering framework focused on iterative development, collaboration, and flexibility. It helps manage and reduce technical debt through continuous improvement and regular feedback.

Examples of managing technical debt with Agile include:

  • Incorporate refactoring tasks into each sprint.
  • Improve code quality and share knowledge.
  • Identify and prioritize technical debt continuously.
  • Plan and discuss debt reduction in every meeting.
  • Regular updates catch and address debt early.

5 Ways to Prevent Technical Debt

Preventing technical debt is important for businesses to maintain a healthy and efficient codebase and reduce frustration and burnout among developers.

Key strategies include:

  1. Conduct regular code reviews to identify and address issues early.
  2. Follow industry standards and guidelines to ensure high-quality code.
  3. Foster open communication by encouraging collaboration among team members.
  4. Implement automated testing to ensure changes do not introduce new problems.
  5. Regularly improve and optimize the codebase during each sprint.

Technical Debt Examples

Agile CRM

An example of technical debt in Agile CRM could involve a team quickly implementing a customer segmentation feature by hardcoding segment rules into the codebase to meet a tight deadline. This incurs deliberate technical debt, as future updates will be difficult without altering core code.


An example of technical debt in Scrum could involve a team quickly implementing user authentication by storing passwords in plain text to meet a sprint deadline. Future updates to enhance security will require significant effort, leading to higher maintenance costs and increased risk of bugs.

Technical Debt Pros and Cons


  • Accelerates time to market
  • Allows testing of new ideas quickly
  • Enables quick feature delivery
  • Helps meet tight deadlines
  • Lower initial development costs
  • Simplifies initial development


  • Complicates future updates
  • Higher long-term costs
  • Increased developer frustration
  • Increased maintenance costs
  • More bugs and lower quality
  • Slower future development

The Bottom Line

The technical debt meaning reflects the extra work required when developers choose a short-term solution over a long-term one. Technical debt is not always negative – it can help businesses accelerate time to market, meet tight deadlines, and lower initial costs.

However, like financial debt, it incurs interest in the form of increased maintenance costs and complexity over time, which can adversely impact the business.

By avoiding shortcuts and fostering collaboration and communication, teams can reduce long-term maintenance costs, improve code quality, and reduce frustration and burnout among developers.


What is technical debt in simple terms?

What is an example of technical debt?

Is technical debt good or bad?

What is technical debt in software development?

Who pays for technical debt?

What is technical debt in scrum?


  1. Technical Debt Quadrant (Martinfowler)

Related Terms

Vangie Beal
Technology Expert
Vangie Beal
Technology Expert

Vangie Beal is a digital literacy instructor based in Nova Scotia, Canada, who has recently joined Techopedia. She’s an award-winning business and technology writer with 20 years of experience in the technology and web publishing industry.  Since the late ’90s, her byline has appeared in dozens of publications, including CIO, Webopedia, Computerworld, InternetNews, Small Business Computing, and many other tech and business publications.  She is an avid gamer with deep roots in the female gaming community and a former Internet TV gaming host and games journalist.