Many large tech companies have already announced job cuts for 2025, but relying on mass layoffs overlooks a strategy that can be a more effective way to optimize resources, inspire innovation, and boost operational efficiency: reducing technical debt.
Technical debt is an unavoidable reality in the tech industry. As businesses grow, change, and evolve, technology must be rebuilt or replaced. Technical debt accumulates when teams take shortcuts to meet immediate business needs, such as by deferring refactoring, delaying infrastructure upgrades, or maintaining outdated systems.
Many companies deliberately take on technical debt to move quickly and capture short-term advantages in product releases. But while these decisions can deliver short-term gains, the long-term costs can be significant, including higher maintenance burdens, slower feature development, increased failure risks, and technical gearing—the point at which engineers spend more time maintaining systems than building new ones.
Reducing technical debt goes beyond cutting costs—it strengthens a company’s ability to adapt and grow. The weight of outdated infrastructure and platforms can hold companies back from critical innovation. For example, deploying AI-powered capabilities is much more effective on a modern tech stack. Companies that proactively manage their technical debt can enhance security, improve developer productivity, enable innovation, and attract more advanced technical talent.
How to Control Technical Debt
The concept of “technical debt” has been around for decades, but organizations still stumble when it comes to the routine planning and strategy required to logically manage tech debt. Like any financial investment, technical debt that is taken on strategically and with a re-payment plan in mind can be a valuable tool for an organization to scale in a fast-paced market. To leverage technical debt as a strategic lever, organizations need a structured, proactive approach to controlling it:
- Identify and assess: Technical debt is often inherited, not created by technical managers, and this makes visibility a challenge. Start with a comprehensive assessment of the technical landscape. Identify, document, and assess the scale of the technical debt across your tech stack. Many tech-forward companies include multiple tech stacks acquired through business activity over time, and holistic visibility is essential to strategize investment in debt reduction.
- Prioritize and reduce: Categorize debt by risk (e.g., security vulnerabilities and system failures) and business value (e.g., impact on product development and market positioning). It is essential to engage enterprise architecture and business teams in these activities, as there are often many dependencies and technical considerations during the prioritization.
- Monitor and track: It’s not possible or desirable to completely eliminate technical debt, so tracking and integrating it into development is critical. Reserving capacity to address technical debt and routine operational fixes and enhancements, sometimes referred to as “Lights on doors open” (LODO) or “Keep the lights on” (KTLO), is a good practice. Rather than expecting teams to make time for technical debt reduction, companies should integrate it into normal business planning, ensuring that engineering resources aren’t diverted entirely to new feature development while foundational systems deteriorate.
- Evaluate whether more drastic measures are needed: Sometimes, the technical debt within an organization’s ecosystem is so great that there is simply no way that it can “pay it back” and still remain a competitive force in its industry. When that happens, extraordinary measures addressing the fundamental structure and role of the debt need to be taken. Measures can include debt consolidation leading to a re-platforming (e.g., cloud migration) or a reevaluation of corporate strategy and direction.
The Competitive Advantage of Chipping Away at Technical Debt
Layoffs provide immediate financial relief, but they don’t address the deeper inefficiencies that drive up long-term costs. In addition to bringing efficiency, reducing technical debt also allows for more rapid innovation and the ability to leverage new technologies and attract top talent. By implementing structured, enterprise-wide initiatives to manage and minimize technical debt; organizations can free up engineering resources, improve operational resilience, and drive business differentiation. In an era where doing more with less is a necessity, tackling technical debt may be one of the most impactful decisions a tech leader can make.
