Internalized Liabilities (obvious but invisible)

“Internalized Liabilities” aim to close an important gap between Finance / Finance Functions and Systemic Views - that so far, I haven't seen someone addressing it, generalizing an approach on "Technical Debt" in Software Development. The presentation introduces and explores the concept of internalized liabilities within organizations— obligations that are “obvious but not visible,” as they are not reflected on traditional balance sheets but have significant impact on future efforts and management attention.  The approach proposes a minimal structure for categorizing and managing these hidden liabilities, comprising Strategic Debt, Organizational Debt, Process Debt, Data (Quality) Debt, Functional Debt, and Technical Debt. Organizations must determine internal “health” levels or ranges for each component. Each debt component is defined by the changes needed to achieve or maintain a healthy state that have not yet been implemented. I emphasize the importance of a systemic view, as addressing one type of debt will affect others and systemic views are directly built in, into the approach: Strategic Debt is about measures needed to maintain a healthy strategic position, leveraging concepts like “Patterns of Strategy” and the Viable System Model is used to assess Organizational Debt. Moreover, the Viable System Model ensures completeness of the approach. And this way, most importantly, it provides a joint vocabulary and language to organizations, translating systemic views into economic views and vice versa.  If time allows: I assessed and challenged the approach via the “anthro-complexity” lenses of Cynefin with interesting results.