Diving overview:
The rapid rise of artificial intelligence is making the information technology landscape increasingly complex, with many companies setting up to prepare for a “tsunami” of technical debt from 2025 onwards, according to research firm Forrester.
More than 50% of technology decision makers predict that technical debt will increase to “moderate or high severity” by 2025, and that number will reach 75% by 2026. Forrester predicts in a recent report. Technical debt refers to the costs incurred by deferring technology upgrades and modernization.
“There’s a tremendous amount of technical debt in IT infrastructure,” Forrester principal analyst Carlos Casanova said in an interview. “It’s just a perfect storm of technology growth, enterprises becoming more decentralized, and AI coming into the mix that will make the problem exponentially worse.”
Dive Insight:
This research highlights the growing challenges that businesses must address as they rush to adopt AI to keep up with their competitors.
Consulting firm Protiviti said in a 2023 report that “CFOs must take the lead in addressing the enterprise’s accumulated technical debt,” with organizations spending an average of 30% of their IT budget and 5% of their IT talent. One of them pointed out that they are investing in technical debt. management.
According to a report released last month by Accenture, AI tools, including generative tools, are now the largest contributors to technology debt, along with enterprise applications. Citing 2022 figures from the Information and Software Quality Consortium, the report said technology-related debt in the United States alone amounts to $2.41 trillion annually.
According to Accenture, 52% of organizations plan to allocate more funds to generative AI by 2025, and this trend is likely to accelerate.
According to the consulting firm, “Generative AI is leading to a classic Catch-22.” “On the one hand, new technical debt is being created. On the other hand, generative AI, if used properly, can help manage technical debt remediation or minimize the creation of technical debt. It’s helpful.”
According to McKinsey analysts, technical debt is caused by making temporary fixes that inevitably become permanent, not updating outdated solutions, and paying for quick technology improvements over long-term benefits. I said in an article last year that this is the result of a variety of practices, including prioritizing delivery and implementing one-off solutions to meet business priorities.
“Many of these decisions made sense and were necessary at the time,” they wrote. “However, increased complexity makes future projects more difficult. This vicious cycle results in significant costs to businesses in the form of missed opportunities and wasted resources.”
According to the Accenture report, AI will only make the problem worse. Among other obstacles, some companies are using platforms built with human interaction in mind, which is not ideal for many of today’s generative AI implementations, the report says. said.
