There's something to this – the emphasis on the optionality of 'technical debt' – but it's not quite 'unhedged'. There's not an 'unlimited downside', as there can be when writing a call on an asset that could appreciate boundlessly.
With tech projects there's almost always a de facto "abandon" option – if not for the firm then at least for the individual engineers. So whenever the cost of proceeding is higher than the expected value, you exit. That clips the downside, more like some sort of combined option position.
Or more like a specific kind of debt: nonrecourse loans secured by collateral. You get the money up front, but if it proves impossible to repay, you simply surrender the collateral. In this case, the collateral is the project itself: either the option to continue, or the IP rights, or the enclosing firm. And, in the event of failure, those may be worth nothing, so you aren't losing an unbounded amount.
For monetary debt, these fragmentary artifacts may in fact be surrendered to the creditors. In the case of metaphorical technical debt, you surrender up those hopes and dreams and mental (sunk) costs, to the reality that there won't ever be the time and budget to fix the system.
And so this leads to a different conclusion than the article, which ends with a near-religious stance against the inflexible evil of debt. Because the downside – project abandonment – is capped, sometimes technical debt is worth taking on, when acceleration-to-market (and thus market-feedback-learning) is of paramount importance. You're borrowing from the future, but you only pay it back (with interest) if there's wild success. If you fail for any other reason – perhaps things having nothing to do with the technical debt – you don't have to pay it off, you just surrender the (essentially worthless) collateral.
That's a hard thing for people with an aesthetic or craftsperson mentality to accept. And it still sucks when it's the technical debt itself – the cost of fixing old rushed choices – that occasionally makes a project no longer competitively viable. Your monetary credit report is unblemished, but your self-conception can take a hit.
With tech projects there's almost always a de facto "abandon" option – if not for the firm then at least for the individual engineers. So whenever the cost of proceeding is higher than the expected value, you exit. That clips the downside, more like some sort of combined option position.
Or more like a specific kind of debt: nonrecourse loans secured by collateral. You get the money up front, but if it proves impossible to repay, you simply surrender the collateral. In this case, the collateral is the project itself: either the option to continue, or the IP rights, or the enclosing firm. And, in the event of failure, those may be worth nothing, so you aren't losing an unbounded amount.
For monetary debt, these fragmentary artifacts may in fact be surrendered to the creditors. In the case of metaphorical technical debt, you surrender up those hopes and dreams and mental (sunk) costs, to the reality that there won't ever be the time and budget to fix the system.
And so this leads to a different conclusion than the article, which ends with a near-religious stance against the inflexible evil of debt. Because the downside – project abandonment – is capped, sometimes technical debt is worth taking on, when acceleration-to-market (and thus market-feedback-learning) is of paramount importance. You're borrowing from the future, but you only pay it back (with interest) if there's wild success. If you fail for any other reason – perhaps things having nothing to do with the technical debt – you don't have to pay it off, you just surrender the (essentially worthless) collateral.
That's a hard thing for people with an aesthetic or craftsperson mentality to accept. And it still sucks when it's the technical debt itself – the cost of fixing old rushed choices – that occasionally makes a project no longer competitively viable. Your monetary credit report is unblemished, but your self-conception can take a hit.