Technical debt vs. process debt – What’s the difference?

When building your technical solutions, issues can arise on two main levels: technical debt and process debt. To understand these concepts, it’s crucial to distinguish where the actual issues lie – is it within the technical structure, or in the way the processes are designed?

What is technical debt?

Technical debt concerns the codebase and the technical architecture. This debt accrues when companies make decisions that might save time or money in the short term but create future problems and extra work. This could mean taking shortcuts to meet a deadline, but at the expense of long-term sustainability and scalability. Some examples of technical debt include:

• Code that has been quickly put together but lacks structure or maintainability
• Outdated systems that require constant adaptation and patching
• Custom software where the code has gradually turned into "spaghetti code" – disorganized with many interdependencies

Technical debt is simply the future extra work that occurs when a quick and easy solution is chosen over durability and quality. It’s often directly tied to the systems and code the business relies on, making maintenance and further development of existing solutions more costly and complex.

Read more about technical debt and how to prevent it.

What is process debt?

Process debt is about inefficient workflows rather than how the software is technically built. The internal processes that have developed over time may no longer be optimal and may have even grown more complex over the years. This could include workflows that are outdated but still followed out of habit.

Examples of process debt include:

• Manual routines performed differently by different employees
• Silo-based communication between departments
• Complex approval processes that create unnecessary bottlenecks

Process debt arises when a company’s workflows fail to keep up with developments or changes in the market, often impacting productivity and efficiency at a foundational level.

Why is it important to distinguish between technical debt and process debt?

Understanding the difference between technical debt and process debt is crucial to identifying where the real issues lie. While technical debt is directly tied to your systems and code, process debt is related to how you work and organize your processes.

Technical debt can often be resolved by updating and reworking systems, whereas process debt requires a review of workflows and routines – a process mapping. Both types of debt can prevent companies from scaling and growing efficiently, but they require different types of approaches to manage effectively.

How to handle technical and process debt

Managing both technical debt and process debt requires a strategy where the company systematically works on improvements and streamlining. The key is to identify the sources, conduct ongoing evaluations, phase out outdated practices, and – automate. This approach is a solid step towards unlocking your company's full potential in terms of technology and digital tools.