Automation Debt

Automation Debt

  • Pawan Jadhav
  • October 25, 2021
Category: Intelligent Automation, Banking, AI

Technical Debt is a term very commonly used in the technology industry. A technical debt is incurred by a company when it chooses to follow a short-cut strategy to get things done. When a company does this, it pays a price in terms of reworking in future. And the difficulty level of making these changes only increase with the extent of technical debt your company accrues. Simply put, Technical Debt is incurred when development teams take actions to expedite the delivery of a feature of even a product in a sub-optimal way to meet a deadline.

Automation Debt – Is it different?

When automation opportunities are identified and not delivered, they become automation debt. Automation debt can be defined as a subset of technical debt, that you incur by putting away automating your processes. This directly tampers with your company’s competitive advantage and instead of working in the future, your company works in the past. A Statista survey shows that companies believe that 52% of legacy systems can be automated.


How to spot an automation opportunity?

Three standard process features for automation are


We got in conversation with some CTOs who said that the first way to spot an automation opportunity is by talking to your team. In most cases, your employees can help identify jobs or processes that are monotonous, mundane and mostly ineffective. A few other areas that can open up opportunities for automation are

  • Legacy processes that will incur very little change in the future
  • Processes that are prone to manual errors
  • Processes that have well define rules and algorithms

Can your company be truly debt free?

Many organizations that have automation debt, can live with it for long periods of time without significant impact to their market competitiveness. But when opportunities to scale and expand come up, the weight of the automation debt will pull you down and impede your rate of growth. The ripple effect of the debt will also slowly but steadily manifest across processes in the organization. It is often easier to prevent a fire than fight one. So here is a three-step framework that can help you reduce automation debt:


Cost of Automation?

Taking a leap into automation would be the way forward even if it means you incur a one-time cost. This means that your opportunity cost will be much higher than your automation implementation cost. This is because trying to rework and implement incremental changes will be cumbersome and cumulatively expensive. The spillage from these fixes can also snowball into a larger issue. Once automated, your processes will reduce your company’s overheads by a large portion and reap the benefits of the digital transformation faster giving you a compelling competitive advantage.

If you would like to know more about why automation is the key to your competitive advantage, check out our e-book “The Skeptic’s Guide to Intelligent Automation”