Technical debt is a term that describes the consequences of a system that has become out of date because of accrued unapplied updates. But if an organization continues to take on technical debt, the system becomes a true legacy system, falling into a state we describe as “technical bankruptcy.” In this report, we identify the symptoms of technical bankruptcy and the devastating effects that it has on the organization. We continue by quantifying the scope of the problem specifically for ERP systems, using our research on the typical age, frequency of upgrades, and extent of modification of these systems. We conclude with recommendations on how to avoid technical bankruptcy and, for organizations that have reached this stage, strategies for getting out and staying out of technical bankruptcy going forward. (20 pp., 6 figs.)
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