Technical debt in Build vs Buy

Been working on a big article for my day job around technical debt as part of the build vs. buy consideration, and I wanted to share a small clip from it as a preview. I personally found this set of statistics fascinating. So much so that I may do a series just on the price of tech and the implications on our technical debt loads. Here is the snippet:

 

Technology companies are frequently involved in M&A (Merger and Acquisition) activities. That’s the fancy way of saying tech companies get bought and sold a lot. In the Boston Consulting Group’s 2017 M&A report (https://www.bcg.com/publications/2017/corporate-development-finance-technology-digital-2017-m-and-a-report-technology-takeover.aspx), they list that there were roughly 43,000 tech company-related transactions over the last 20 years. That’s 2,150 a year involving tech companies merging and otherwise being bought. This is not a small number of companies being acquired and in all likelihood being fundamentally changed or shutdown altogether. The risk is there and it is worth consideration in the decision.

Let’s contrast that with the “technical debt risk” of building something from scratch and possibly losing the holders of that debt, the developer(s). According to the Bureau of Labor website, there were 1,256,200 “Software Developer” jobs in the US in 2016 (https://www.bls.gov/ooh/computer-and-information-technology/software-developers.htm) That number is currently expected to grow 24% in the next 10 years. That means there will be approximately 300,000 new developer job openings in the next 10 years. A staggering 30,000 new job openings per year. With that type of competition in the market, it is not just likely, but inevitable that you will lose developers to better paying, more interesting, or simply new jobs in that time.

Put another way, you are 93% more likely to lose a developer(s) than you are to lose a vendor. Before you pull the plug on all development, this is not a death knell for building solutions yourself. It is just a data point that illustrates that whether you choose a platform or build one yourself there are risks. You are choosing where you want that risk to lie.

 

I will post the full article(s) when they are out! <update> Full article is here!