Accountability
Let's emphasize: Scrum Masters are "accountable for the effectiveness of their team." (Quote: Scrum Guide)
If a team is technically highly competent, a Scrum Master will focus on other areas such as team organization, collaboration with other teams, interaction with management, and optimizing value creation, for example. In this case, no technical skills are required.
In Practice
Scrum Masters, by virtue of their role, aren't technical experts themselves, but must definitely be able to identify technical problems and provide the team with a way forward.
In practice, many teams are far from being as technically mature as one would wish. Code quality is lacking, test automation is an ongoing issue, and many other small problems. Why? It's due to a lack of understanding of technical practices such as Continuous Integration, Refactoring, or Test Driven Design. Primarily, such teams face the problem: "How do I know what I don't know?" If the team recognizes that there's a technical problem hotspot somewhere, it is sufficient for a Scrum Master to work this out precisely with the team and ensure that they receive competent technical coaching and the necessary time for improvement.
That becomes difficult when neither the team members understand their technical situation and competence - nor does their Scrum Master. Then, the team is running head first, full steam ahead into a brick wall - and that will get really uncomfortable:
For the company, which in the worst case becomes long-term incapacitated and in any case loses millions.
Which, in turn, could lead to layoffs for the developers.
And in the middle of it all is a Scrum Master who is accountable for all of this - but completely clueless.
Very unpleasant.
Closing remarks
I've had good and bad experiences with Scrum Masters who have been in technical roles for years, and the positive ones are more numerous. I particularly want to positively highlight the qualification of QA experts who, by profession, are accustomed to questioning everything, uncovering problems, and, if necessary, confronting management.
Hence, I'm confident that having done technical work that helps a Scrum Master succeed is definitely an asset.
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