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MID SIZE BUSINESSES ‘AT RISK’
The journey to technical debt recovery
An Executive Business Briefing
Presented by Noel Lynam
Date Jan-Feb 2019
Technical debt is snowballing in
mid size businesses in Australia
90% of mid size businesses have technical debt*
*Calypsi estimates based on IT audits of medium sized Australian firms from 2010 to 2018
You can pay as you go for best practice, compliant, secure and reliable IT that can adapt to changing business
conditions or cut corners with short term thinking, create debt and operate with much greater risk.
40% of companies
have debts 3 x their
industry average IT
budget
20% of companies
have debts 6 x their
industry average IT
budget
40% of companies
have debts 4 x their
industry average IT
budget
SIZE OF DEBT AS A MULTIPLE OF ANNUAL IT
BUDGET
3 X
4 X
6 X
“At Risk” businesses create technical debt by
only focusing on User Facing IT
Technical debt in a ”At Risk” business is hidden
“At Risk” businesses have a pay day ahead, they:
• Face more frequent and longer system outages impacting employee
productivity and morale.
• Cannot adopt business transformation activities until significant amounts of
debt are cleared.
• Will have a significantly harder time implementing change.
• Have low levels of disaster resilience. Will loose time, money, reputation,
customers and face potential lawsuits.
• Struggle to meet regulations and fiduciary responsibilities.
• Cannot enforce risk management strategies.
Pay day ahead for ”At Risk” businesses
Symptoms of an ”At Risk” business
SYMPTOM IMPACT SOLUTION
Chaos and complex systems High levels of outages of IT investment Create an all-encompassing IT strategy
Limited disaster recovery plans Vulnerable to system outage, employee
downtime, lost productivity, focus, legal
costs, customer dissatisfaction or cyber
attack
Implement annual or bi-annual planning
and testing
Difficulty adding
new features
End user productivity is compromised
and loss of competitiveness
Implement a culture of continuous
improvement.
Costly break and fix exercises Cost of issue management 5 x that of
technically efficient businesses
Deploy an Integrated and standardised
system architecture in everything you do
‘At Risk’ levels of legal compliance Shortfalls in reporting, fraud, customer
protection and agreed service levels
IT risk leadership and transparency into
system compliance
No centralised control Costly governance and quality
management
IT leadership and enterprise wide view
across all workloads in the organisation
Symptoms of an ”At Risk” business
High Risk Low Risk
One of the many signs technical debt is growing in your organisation.
Consequences of inaction to resolve Technical Debt
Downtime in business
critical functions
If one piece of the system fails, it
can cause breakdowns in other systems,
due to tight dependencies and band-aid
solutions.
Reputation cost after
enforcement
cost in terms of
loss of customer confidence
can be many times higher
than IT costs.
Director’s liability from
software or process
short cuts
Loss of competitive
advantage
Inability to add features to keep pace
with rising customer expectations
TIME
LIABILITIES,
INEFFICIENCIES
AND COSTS
Liabilities grow as technical debt grows
Consequences of inaction to resolve Technical Debt
Damaged Reputation
after enforcement
Director liability
from internal or
external failures
Downtime
in business critical
functions
Loss of
competitive
advantage
99%
95%
50%
25%
Estimated likelihood of ‘At Risk’ business facing consequences by 2021 if technical debt unaddressed*
*Calypsi estimates based on IT audits of medium sized Australian firms from 2006 to 2019
The pathway to IT maturity and
recovery from technical debt
IMRPOVEINNOVATE
BUSINESS TRANSFORMATION
Efficiency
Effectiveness
Value
IT exceeds standard benchmarks and SLAs
Proactive problem management
Greater end user experience
IT leverages untapped capabilities in
systems
Greater capacity planning and budgeting
Greater capacity to innovate without shortcuts
Business focused outcomes not IT focused
Greater end user engagement in company goals
Improved user productivity and communication
Reliable and functional systems
Centralised control
Work to industry standards
Standardisation of systems and processes
24/7 management of IT risks
Regulatory compliance
pathway to
business
maturity
MAINTAIN
IT Maturity minimises technical risk and debt
Find out more about
building your value based
IT future
Meet with a Calypsi consultant for a one on one
discussion about your needs and opportunities
call 1300 408 408
email noel.lynam@calypsi.com

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The pathway to technical debt recovery for mid size Australian business

  • 1. MID SIZE BUSINESSES ‘AT RISK’ The journey to technical debt recovery An Executive Business Briefing Presented by Noel Lynam Date Jan-Feb 2019
  • 2. Technical debt is snowballing in mid size businesses in Australia
  • 3. 90% of mid size businesses have technical debt* *Calypsi estimates based on IT audits of medium sized Australian firms from 2010 to 2018 You can pay as you go for best practice, compliant, secure and reliable IT that can adapt to changing business conditions or cut corners with short term thinking, create debt and operate with much greater risk. 40% of companies have debts 3 x their industry average IT budget 20% of companies have debts 6 x their industry average IT budget 40% of companies have debts 4 x their industry average IT budget SIZE OF DEBT AS A MULTIPLE OF ANNUAL IT BUDGET 3 X 4 X 6 X
  • 4. “At Risk” businesses create technical debt by only focusing on User Facing IT Technical debt in a ”At Risk” business is hidden
  • 5. “At Risk” businesses have a pay day ahead, they: • Face more frequent and longer system outages impacting employee productivity and morale. • Cannot adopt business transformation activities until significant amounts of debt are cleared. • Will have a significantly harder time implementing change. • Have low levels of disaster resilience. Will loose time, money, reputation, customers and face potential lawsuits. • Struggle to meet regulations and fiduciary responsibilities. • Cannot enforce risk management strategies. Pay day ahead for ”At Risk” businesses
  • 6. Symptoms of an ”At Risk” business SYMPTOM IMPACT SOLUTION Chaos and complex systems High levels of outages of IT investment Create an all-encompassing IT strategy Limited disaster recovery plans Vulnerable to system outage, employee downtime, lost productivity, focus, legal costs, customer dissatisfaction or cyber attack Implement annual or bi-annual planning and testing Difficulty adding new features End user productivity is compromised and loss of competitiveness Implement a culture of continuous improvement. Costly break and fix exercises Cost of issue management 5 x that of technically efficient businesses Deploy an Integrated and standardised system architecture in everything you do ‘At Risk’ levels of legal compliance Shortfalls in reporting, fraud, customer protection and agreed service levels IT risk leadership and transparency into system compliance No centralised control Costly governance and quality management IT leadership and enterprise wide view across all workloads in the organisation
  • 7. Symptoms of an ”At Risk” business High Risk Low Risk One of the many signs technical debt is growing in your organisation.
  • 8. Consequences of inaction to resolve Technical Debt Downtime in business critical functions If one piece of the system fails, it can cause breakdowns in other systems, due to tight dependencies and band-aid solutions. Reputation cost after enforcement cost in terms of loss of customer confidence can be many times higher than IT costs. Director’s liability from software or process short cuts Loss of competitive advantage Inability to add features to keep pace with rising customer expectations TIME LIABILITIES, INEFFICIENCIES AND COSTS Liabilities grow as technical debt grows
  • 9. Consequences of inaction to resolve Technical Debt Damaged Reputation after enforcement Director liability from internal or external failures Downtime in business critical functions Loss of competitive advantage 99% 95% 50% 25% Estimated likelihood of ‘At Risk’ business facing consequences by 2021 if technical debt unaddressed* *Calypsi estimates based on IT audits of medium sized Australian firms from 2006 to 2019
  • 10. The pathway to IT maturity and recovery from technical debt
  • 11. IMRPOVEINNOVATE BUSINESS TRANSFORMATION Efficiency Effectiveness Value IT exceeds standard benchmarks and SLAs Proactive problem management Greater end user experience IT leverages untapped capabilities in systems Greater capacity planning and budgeting Greater capacity to innovate without shortcuts Business focused outcomes not IT focused Greater end user engagement in company goals Improved user productivity and communication Reliable and functional systems Centralised control Work to industry standards Standardisation of systems and processes 24/7 management of IT risks Regulatory compliance pathway to business maturity MAINTAIN IT Maturity minimises technical risk and debt
  • 12. Find out more about building your value based IT future Meet with a Calypsi consultant for a one on one discussion about your needs and opportunities call 1300 408 408 email noel.lynam@calypsi.com