Technical Debt in Agile: A Complete Guide for Teams

When teams move quickly, technical debt often finds its way into the codebase, disrupting delivery schedules, lowering team morale, and compromising long-term stability. In Agile environments, where rapid iteration is the norm, this hidden cost can quietly accumulate, eventually slowing progress and increasing the burden of maintenance.

However, technical debt isn't inherently negative. Much like financial debt, it can be a strategic choice, beneficial when taken on with clear intent and a repayment plan. In this guide, you'll gain a deeper understanding of how technical debt emerges in Agile workflows, why it matters, and how to manage it effectively through proven strategies for repayment and prevention.

What Is Technical Debt in Agile?

Technical debt in Agile refers to the buildup of suboptimal code, quick fixes, or incomplete work that teams take on—intentionally or not—to speed up delivery. The term, coined by Agile Manifesto co-author Ward Cunningham, uses a financial metaphor:

“Shipping first-time code is like going into debt... A little debt can speed development, provided it is paid back promptly with interest. The danger occurs when the debt is not repaid.” — Ward Cunningham

Just like financial debt, tech debt can be useful if managed, enabling faster releases in exchange for future refactoring. However, if ignored, it leads to mounting “interest” in the form of bugs, slower development, and unstable systems.

Thought leaders like Martin Fowler and Atlassian agree: technical debt isn’t inherently bad. It’s a strategic tool, as long as teams plan to repay it before it becomes a long-term liability

Why Agile Teams Accumulate Debt

Agile teams accumulate technical debt primarily due to the pressure to deliver quickly and the iterative nature of Agile development. Key reasons include:

• Velocity and Time Pressure: Agile’s fast-paced sprints often push teams to prioritize delivery over clean code, leading to shortcuts that create technical debt.

• MVP Culture: To validate ideas quickly, teams accept suboptimal solutions in MVPs, intentionally deferring optimization and accumulating debt.

• Changing Requirements: Agile’s flexibility with evolving needs can lead to fragmented code if earlier design decisions aren’t revisited, increasing debt over time.

  
  

Shortcuts and “Move Fast” Mindset: The habit of delivering first and cleaning up later supports speed but risks long-term debt if refactoring is delayed.

Types of Technical Debt

Code Debt

Code debt arises from poor coding practices, such as duplicate logic, lack of modularization, or quick fixes that bypass best practices. For example, hardcoded values, inconsistent naming, or skipping refactoring make future changes harder and debugging more time-consuming, ultimately hindering maintainability and scalability.

Design Debt

Design debt is the result of flawed or outdated system architecture, poor abstractions, or rigid structures that limit scalability and flexibility. Examples include tightly coupled components, a lack of clear interfaces, or architectures that can’t adapt to new requirements, making it costly to add features or scale the system.

Testing and QA Debt

Testing and QA debt occur when there are incomplete unit tests, missing test automation, or unreliable (“flaky”) tests. This leads to gaps in test coverage, an increased risk of bugs in production, and challenges in maintaining stable CI/CD pipelines, which slow down safe deployments and increase maintenance overhead.

Documentation Debt

Documentation debt is caused by missing, outdated, or incomplete documentation, such as the absence of API documentation or reliance on tribal knowledge. This slows onboarding, hampers knowledge transfer, and increases the risk of misunderstandings or repeated mistakes as new team members struggle to find accurate information.

Infrastructure & Process Debt

Infrastructure and process debt stems from outdated tools, a lack of automation, or manual workflows. Examples include unsupported libraries, manual deployments, or inefficient development processes, all of which reduce productivity, increase downtime, and make it harder to adopt new technologies or practices.

When Is Technical Debt Helpful or Harmful?

Helpful (Strategic) Technical Debt

Not all technical debt is bad—when taken intentionally and managed well, it can accelerate delivery. Strategic debt is:

• Planned and visible in the backlog

• Accepted consciously to meet a deadline or validate an MVP

• Paired with a clear plan for cleanup or refactoring

• Used to gain speed without compromising long-term stability

Harmful (Reckless) Technical Debt

Debt becomes dangerous when it’s unintentional, hidden, or ignored. Reckless shortcuts are:

• Taken without team discussion or stakeholder awareness

• Caused by poor design, lack of experience, or rushed delivery

• Untracked and often left unresolved, causing future slowdowns

• A major source of bugs, outages, and maintenance headaches.

Benefits of Strategic Debt

The key benefits of strategic technical debt include:

• Faster Time to Market: Strategic technical debt speeds up delivery, helping teams reach users early and gain a competitive edge.

• Prototyping and Experimentation: It enables quick prototyping and testing of ideas without over-investing in perfect code upfront.

• Resource Prioritization: Accepting debt lets teams focus on critical features first, deferring lower-priority improvements.

• Risk Reduction in Early Stages: For startups, it lowers early development costs and risks, allowing faster learning before scaling.

• Enabling Agility: Well-managed debt supports flexibility, letting teams adapt quickly to shifting market needs without over-engineering.
  

Risks and Long-Term Costs

While strategic technical debt can provide short-term benefits, unmanaged or reckless debt carries significant risks and long-term costs:

• Slower Development Speed: Accumulated debt clutters the codebase, making future development slower, riskier, and less efficient.

• Increased Bugs and System Failures: Reckless shortcuts lead to unstable code, resulting in more bugs, outages, and poor user experiences.

• Higher Maintenance Costs: Technical debt increases long-term upkeep, pulling resources away from innovation and new features.

• Team Frustration and Burnout: Messy code frustrates developers, reduces morale, and raises the risk of turnover and silos.

• Risk of Technical Bankruptcy: Ignored debt can cripple systems, forcing costly rewrites or shutdowns that disrupt business operations.

Measuring Technical Debt

To effectively measure and track technical debt, engineering managers can rely on specific key metrics and tools that provide actionable insights into code quality and debt accumulation.

Key Metrics to Track

• Code Complexity: Measures how difficult the code is to read or modify; higher complexity signals maintenance challenges and debt risk.

• Test Coverage: Tracks how much of the code is tested; low coverage increases the chance of defects and hidden technical debt.

• Issue Backlog: Reflects unresolved bugs, code smells, or debt tasks; a growing backlog indicates accumulating technical debt.

• Code Churn: Monitors how often code changes; high churn suggests instability and areas likely burdened with design flaws.

• Defect Rate: Measures the frequency of bugs per code or release; higher rates often reveal deeper, quality-impacting debt.

Practical Tools & Dashboards

• SonarQube: Scans code for bugs, smells, and complexity, offering a technical debt ratio and actionable dashboards.

• Code Climate: Provides automated code insights on duplication and maintainability to guide refactoring decisions.

• Jira: Enables teams to track and prioritize technical debt tasks within the backlog, maintaining visibility and control.

• Function & CAST Imaging: Analyze architectural debt in legacy systems, helping teams visualize risk and plan modernization.

• CodeAnt.ai & Stepsize AI: AI-powered tools that deliver real-time code quality feedback and automate debt tracking within dev workflows

Strategies to Manage and Reduce Technical Debt

Here are detailed strategies to manage and reduce technical debt effectively.

1. Embed Debt in Sprint Planning & Backlog

Incorporate technical debt items directly into the product backlog and prioritize them alongside new features during sprint planning. This ensures debt is visible, acknowledged, and addressed regularly rather than ignored.  Agile tools like Jira help track and prioritize debt tasks, enabling teams to balance feature development with quality improvements.

2. Allocate Refactoring Time Regularly

Dedicate time in each sprint or release cycle specifically for refactoring and paying down technical debt. For example, teams might allocate 20% of sprint capacity to debt reduction or run focused “swarm” sprints. Regular refactoring prevents debt from piling up and keeps the codebase healthy and maintainable.

3. Automate Testing & CI/CD

Using automated unit tests, integration tests, and CI/CD pipelines to catch issues early and ensure consistent code quality. Automation minimizes flaky or missing tests, speeds up feedback loops, and keeps the main branch in a releasable state, effectively controlling the growth of technical debt.

4. Encourage Collective Code Ownership

Build a culture where the whole team shares responsibility for code quality and technical debt, not just a few developers. Collective ownership promotes knowledge sharing, reduces silos, and motivates everyone to address debt proactively, enhancing maintainability and reducing bottlenecks.

5. Conduct Regular Debt Reviews

Schedule periodic technical debt reviews or audits to identify, categorize, and prioritize issues. Reviewing debt regularly during retrospectives or in dedicated sessions maintains team awareness, helps track progress, and ensures prioritization based on risk and impact, preventing debt from escalating.

6. Communicate & Document Debt Transparently

Keep clear, accessible documentation of known technical debt, its impact, and plans for repayment. Transparent communication with stakeholders and team members builds a shared understanding and commitment to addressing debt, while centralized documentation reduces silos and aids onboarding.

Paying Off and Preventing Technical Debt

Paying off technical debt effectively requires a balanced approach of incremental improvements and long-term preventive measures:

Refactor incrementally

Instead of attempting a large-scale rewrite, Agile teams should address technical debt in small, manageable pieces during regular sprints. This approach maintains steady progress without hindering the delivery of new features, allowing continuous improvement alongside ongoing development.

Modernize tools and processes 

Upgrading infrastructure—such as adopting modern Continuous Integration/Continuous Deployment (CI/CD) pipelines—and automating repetitive manual tasks can drastically reduce technical debt. These improvements save time, increase reliability, and prevent the accumulation of new debt by streamlining workflows

Prevent future debt

 Establishing regular code reviews, enforcing consistent coding standards, and thoroughly documenting processes are essential practices. They help maintain code quality, foster team discipline, and keep technical debt manageable over time.

Examples of Technical Debt in Agile

Here are concrete examples of technical debt in Agile, illustrating common real-world scenarios:

Outdated Frameworks or Libraries

Many teams still use AngularJS in 2025 despite its official deprecation since 2021. This legacy framework lacks security updates, exposing applications to critical vulnerabilities like content spoofing and denial-of-service attacks. Additionally, AngularJS struggles with compatibility on modern browsers and libraries, increasing maintenance costs and slowing new feature development.

Quick Fixes and Workarounds

Teams often resort to hardcoded logic, commented-out code, or leaving “TODO” notes as shortcuts to meet deadlines. For example, a developer might hardcode API endpoints or disable error handling temporarily. These quick fixes accumulate as debt, making the codebase fragile, harder to understand, and costly to refactor later.

Insufficient Testing

Low test coverage, especially when only “happy path” scenarios are tested, leaves many edge cases unverified. This leads to frequent regressions and bugs slipping into production, which slows down development as teams spend more time fixing issues. Lack of automated tests also hinders continuous integration and delivery pipelines.

Poor or Missing Documentation

Missing onboarding guides, outdated API documentation, or absent system diagrams force new team members to rely on tribal knowledge. This slows down ramp-up time, increases the risk of errors, and causes repeated misunderstandings or duplicated efforts, ultimately reducing team productivity and increasing project risk.

Understanding the 4 Quadrants of Technical Debt

The Technical Debt Quadrant helps teams classify and manage technical debt by answering two key questions:

• Vertical axis: Was the debt taken on deliberately (knowingly) or inadvertently (accidentally)?

• Horizontal axis: Was the decision prudent (carefully considered) or reckless (careless or short-sighted)?

  
  

This creates a 2x2 matrix:

	Prudent (Careful)	Reckless (Careless)
Deliberate (Knowingly taken)	Deliberate & Prudent	Deliberate & Reckless
Inadvertent (Accidental)	Inadvertent & Prudent	Inadvertent & Reckless

Quadrant Descriptions and Team Examples

1. Deliberate & Prudent (Top-Right Quadrant)

   
   

   • Description: The team knowingly takes on technical debt but does so with a clear plan and understanding of the risks and consequences. This is often a strategic choice to meet deadlines or test ideas, with repayment planned.

   • Example: A team decides to implement a quick workaround to release a feature for a major client, fully aware they will refactor it in the next sprint. They document this debt and allocate time for cleanup.

   • Outcome: This is the ideal quadrant, balancing short-term delivery with long-term maintainability.

     
     

2. Deliberate & Reckless (Top-Left Quadrant)

   
   

   • Description: The team knowingly takes shortcuts without fully considering or planning to address the consequences later. This is risky and often leads to growing debt.

   • Example: Developers rush a feature, ignoring best practices and testing, with no plan for refactoring or fixing technical debt later.

   • Outcome: This quadrant is the most dangerous, often leading to costly rework and slowed progress.

     
     

3. Inadvertent & Prudent (Bottom-Right Quadrant)

   
   

   • Description: The team accidentally incurs technical debt due to a lack of knowledge or awareness, but is committed to learning and improving. They recognize mistakes and take steps to prevent recurrence.

   • Example: A junior developer unknowingly writes inefficient code; the team reviews it, learns from the mistake, and updates coding standards to avoid similar issues.

   • Outcome: This quadrant reflects learning and continuous improvement.

     
     

4. Inadvertent & Reckless (Bottom-Left Quadrant)

   
   

   • Description: Technical debt arises accidentally due to ignorance, lack of discipline, or poor processes, with no awareness or effort to address it.

   • Example: A team repeatedly skips code reviews and testing due to poor process maturity, accumulating hidden debt that causes bugs and delays.

   • Outcome: This is undesirable and often the hardest debt to detect and fix.

Hire Skilled Developers to Reduce Technical Debt

Reducing technical debt starts with the right people. At Leanware, we connect you with highly vetted, skilled developers who not only meet your technical requirements but also integrate seamlessly with your team, matching your time zone, communication style, and work culture.

We take care of the operational overhead, like onboarding, compliance, and payroll, so you can stay focused on innovation and delivery. If technical debt is slowing you down, let’s talk about how Leanware can help you build a stronger, more scalable engineering team.

FAQs

What is technical debt in Agile development?

Technical debt refers to the future cost of shortcuts or suboptimal code taken during development to meet deadlines. It slows down future work and increases maintenance effort.

Is technical debt “agile allowed” in Scrum?

Yes, Scrum allows technical debt, but it must be made visible, discussed during Sprint Planning or Reviews, and managed through the Product Backlog. Hiding it violates transparency.

What are the 4 quadrants of technical debt in Agile?

The four quadrants classify technical debt by intent and awareness:

• Reckless & Deliberate – Knowingly cutting corners.

• Reckless & Inadvertent – Caused by lack of skill or understanding.

• Prudent & Deliberate – A strategic trade-off under time pressure.

• Prudent & Inadvertent – Arises despite best practices due to unknowns.

What are examples of technical debt in Agile?

Common types of technical debt include:

• Code Debt – Duplicate code, lack of modularity

• Design Debt – Poor architecture, missing design patterns

• Testing Debt – Insufficient test coverage or automation

• Documentation Debt – Outdated or missing internal docs

• Process Debt – Skipping retros or quality checks to speed up delivery