Australian enterprises wasting millions due to tech debt: report

The average Australian enterprise is wasting more than $365 million annually due to an inability to deal with mounting technical debt, research commissioned by Pegasystems indicates.

A global study from Savanta surveyed more than 500 IT decision-makers worldwide on the challenges caused by tech debt and enterprises’ progress in modernising legacy technology. The study estimated that Australian enterprises are wasting nearly $136 million per year, $2 million above the global average, on completing legacy transformation projects using outdated resource-intensive processes.

Other contributors to the annual cost of tech debt were the cost of time invested in legacy transformation initiatives that have failed due to outdated systems and applications ($59 million per year on average), as well as the estimated cost of maintaining, updating and integrating with legacy systems ($55 million per year on average), the report into the study claims.

Meanwhile respondents to the survey overwhelmingly (88%) agreed that the time, money and effort spent maintaining legacy applications could be spent more productively on other projects, while 67% said their organisation depends on between one and 10 legacy applications in the front and back office on any given day.

Asked why they had not removed support for legacy systems, 39% said they were too busy addressing problems caused by tech debt to address the root cause, 29% said it was too time consuming to do so, and 26% said their business leaders don’t view it as a priority.

Pega CTO Don Schuerman said the report highlights the fact that too few enterprises are considering the mounting costs and inefficiencies caused by tech debt and legacy technologies.

“It’s no longer acceptable to depend on systems that are no longer fit for purpose, take valuable resources to replace, and which could be the difference between your organisation’s success or failure. It’s time to stop the bleeding,” he said. “The time has come to turn tech relics into modern, cloud-ready, AI-enabled applications that deliver transformed outcomes to your customers and your business.”

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