Organizational debt is like technical debt, but worse

This is why if you&#x27;re joining a startup as an employee you should ask for either a competitive market salary or real equity (not the insultingly low amount that normally gets offered as equity -- an actual stake).<p>I think a lot of people join startups and take a bad deal because they think the company will take care of them when the company makes it. Or they think they&#x27;ll have more opportunity for promotions in the startup because of its small size and their early stake. The problem is usually executive roles are filled from outside the company rather than from internal promotions, and as this article illustrates, the founders don&#x27;t necessarily care about the people at the bottom until it&#x27;s bluntly pointed out to them how mass departures could fuck up the business.

I&#x27;m at a startup where I found out a junior hire -- worse in every way than myself and several steps down in title -- is making at least 30% more than I am. It&#x27;s a strange position. I&#x27;ve started polishing my resume as a result.

Another reason why organizational debt can be worse than technical debt is that often in the case of technical debt, the engineers know what the proper solution is, but given time constrains, they opt for a solution that merely meets their current needs. But with organizational debt, often the immature company does not even know what the proper solution would be.<p>And then, of course, there are cases of both technical debt and organizational debt where the people in charge don&#x27;t even realize that they&#x27;ve incurred debt. They think they <i>do</i> have the optimal solution.

Just like with technical debt, there is a risk of refactoring organizational debt wrong, or over-refactoring. I believe it happened where I once worked. It worked beautifully as a small company, but when the workforce started exceeding 100, the need for better HRM, more formal performance evaluation, better defined reporting hierarchies and career paths became evident. A lot of processes were introduced, but the way it was done induced culture shock in people who had been in the company a long time. I think we lost a few good brains as a result.

What areas of organizational technical debt are there? I counted the piece raised three: unmanaged compensation schemes, lack of systematic onboarding, lack of keeping tally on the most promising employèes and making them know they are valued.<p>I think there is also a typical pattern that perhaps is too trivial yet not that all too uncommon - lack of organizational restructuring as a company grows (the startup style where some people do everything can create bottlenecks and very high risk bus factors).<p>Are there any others?

Organizational debt can create technical debt and may be the single biggest cause.<p>Even if you make it with technical debt, somewhere in your org, someone&#x27;s life is worse because of that technical debt, but the cause was probably organizational debt. The good employees see it sooner and suffer it longer or leave before others see it. A downward spiral in other words with entropy increasing.

This is a great read and I recommend it to anyone in the &#x27;build&#x27; phase of their company. The thing that always amazes me is how the organization of a company can enhance or limit what they can build in technology.

Where is the evidence that technical debt, let alone organizational debt, is actually related to the economic indicators of success?