Skip to Content
Technical Articles
Author's profile photo Ayman Elgendi

Functional Debt in S/4HANA Projects

“Some problems with code are like financial debt. It’s OK to borrow against the future, as long as you pay it off.”

Ward Cunningham


Functional debt is a variation of technical debt, which refers to the cost of maintaining and repairing software systems that were developed using suboptimal solutions or shortcuts.

While functional consultants may not deal with code, they can still accrue functional debt by making decisions that have long-term consequences.

When functional consultant makes a decision to take an easy but limited solution instead of a better approach that would take longer this can be a “functional debt”.

This can happen for a variety of reasons, such as time constraints, budget constraints, or a lack of
knowledge about the best approach.

In new implementations, for example, the pressure to meet deadlines may lead to the adoption of quick and easy solutions that may not be the most efficient or effective in the long run.

Functional debt is not always bad, as quick decisions are sometimes necessary to meet project deadlines. However, the more functional debt a system has, the more costly it becomes to maintain and upgrade.

Therefore, it is important to manage functional debt and pay it off when necessary.

One approach to managing functional debt is to:

  1. Introduce this terminology in your team.
  2. Record the debt in a debt registry.
  3. Always refactor. As developers refactor their code, functional consultants should always refactor their configuration to
    ensure that the system is optimized for efficiency and effectiveness.

In conclusion, functional debt is a concept that can have a significant impact on the success of a project and system quality.

By understanding and managing functional debt, functional consultants can help ensure that the system is optimized and efficient, which translates to a better quality and long-term cost savings.



Assigned Tags

      You must be Logged on to comment or reply to a post.
      Author's profile photo Sean House
      Sean House

      I appreciate your raising this topic - too many times I've seen us "put in this temporary sub-optimal work-around and we'll fix it in Release 2" only later to be told "the client has cancelled Release 2"... and you realise  they might be stuck with that work-around for a decade or more...

      • I think in many cases the functional consultant is stuck between a rock and a hard place - the Project Manager is pushing them to avoid scope expansion and "Gold Plating" while the consultants often know that they may be laying the foundation for future issues.
      • At the end of the day you can't give the client more "quality" then they are willing to purchase.


      I'd be curious to know if this is a topic that PMI or other groups have addressed as I see this as needing a more holistic discussion.

      Author's profile photo Ayman Elgendi
      Ayman Elgendi
      Blog Post Author

      can't agree more

      Author's profile photo Simon Polovina
      Simon Polovina

      Such scenarios might ideally be avoided by fit-to-standard at the outset, as captured by SAP's Activate methodology. Managing Organizational Change for the Implementation Project ( includes the Fit-to-Standard mindset for this purpose.