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October 2, 2025California Management Review4 citationsOpen Access

Technical Debt Is Killing Digital Transformation, But There Is a Way Out

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AAAleksandre AsatianiJTJacob TorellTRTapani Rinta-Kahila

Key Points

  • Technical debt significantly hampers digital transformation efforts due to outdated systems and practices.
  • A gradual approach to system replacement can help organizations manage technical debt effectively, rather than the typical big bang strategy.
  • Organizations must redefine the role of IT from simply managing debt to enabling strategic business outcomes.
  • This article outlines four key strategies that managers can implement to mitigate technical debt and enhance digital transformation.

Abstract

Digital transformation is important for organizations to stay competitive. Yet, incumbents face challenges from technical debt accrued from legacy information systems. The big bang approach—aiming for a rapid replacement of legacy systems—often falls short. This failure largely results from treating technical debt as a purely technical issue, while overlooking its managerial implications. What is needed is a gradual approach that redefines IT’s role from debt custodian to strategic enabler, focusing on generating business value rather than solely eliminating technical debt. This article offers four recommendations for managers to handle technical debt amid digital transformation.

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Cite This Study

Asatiani et al. (2025) studied this question.

synapsesocial.com/papers/68de6f3f83cbc991d0a22b86https://doi.org/10.1177/00081256251370795
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