BROOMFIELD, Colo. – Dormain Drewitz, who leads product marketing for Pivotal’s Platform Ecosystem, successfully kept up the esoteric nature of this year’s Glue Conference 2019 event with a keynote address that linked technical debt to the derivatives market.

Drewitz explained that technology companies need to prioritize the level of risk in their technical debt just as banks do when they package up mortgage loans as derivatives. (And, if possible, forget what happened 10 years ago with those packaged mortgage loans.)

The term technical debt is often used to refer to the use of software code that is developed by someone outside of an organization that is then used instead of investing the time and resources to create new code. The debt part comes from the longer-term costs associated with at some point having to make additional investments in changing that used code to better target an operational outcome.

“There is a notion that debt is bad,” Drewitz noted, explaining that “we have been culturally engrained to be skeptical of debt. But it powers our economy and technology debt probably powers your business. It’s an instrument or tool and your code is a tool. … We need to move past it and realize it's powering a lot.”

Drewitz’ notion was that technical debt should not be viewed negatively and instead viewed in terms of different levels of risk. Technical debt that has a lower chance of powering business outcomes that pay back that debt should be viewed as riskier than technical debt that powers business outcomes that will definitely pay back that investment.

“Is the collateral on this particular debt the business that this code drives?” Drewitz asked rhetorically. “Is it driving a lot of business or not a lot of business? This is needed to know so you know how much debt to take on.”

If that collateral or the debt being collected by using a particular slice of code is not driving a positive business outcome, then “should we be using a SaaS [software-as-a-service] provider for it,” she added.

Drewitz used the example of Discover Card, which was able to eliminate thousands of lines of legacy code that was not driving a business outcome, but still kept some of that code because it was.

“It’s a pattern in people in getting themselves out of a toxic debt situation,” Drewitz said of the example. “They are not eliminating it, they are just moving it to debt that drives business models.”

She also explained that where that technical debt comes from is an important consideration. Drewitz noted that if that debt is coming from outside of your business you need to figure out how you can offset that debt. But, if that debt is coming from either inside the business or if as a developer you are borrowing it from yourself, “no one else is involved in that risk situation.”

“It might be healthier to be borrowing from another party and let them deal with the derivative than borrowing from yourself,” Drewitz said.

(And, again, forget what happened a decade ago.)