Roi Issue in Test Automation

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Date Submitted: 09/19/2010 12:27 PM

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Factors Affecting Return-On-Investment (ROI) in Automation


Viveka Nand Bharti

Background / Objective:

The objective of this paper is to provide the guidelines for quantifying the hard benefits and soft competitive benefits that are important in developing a complete picture of the total Return-On-Investment (ROI). This paper helps the decision makers in evaluating the financial viability by comparing the magnitude and timing of the expected gains to the investment costs. This document primarily takes test automation as classic example for its ROI analysis.


1 Introduction 4

2 Benefits 5

3 ROI Computations 10

4 Case Study 15

4.1 15

Automation of Smoke Test examples: 15

5 Conclusion 17

6 References 18

7 Author’s Profile 19


Any project team or an organization, which wants to go for test automation, will first think in terms of COST benefit and TIME/Effort gained. Return-On-Investment (ROI) is the first step in the way of test automation, but it is very important to note that this is not the only thing to keep in mind before going ahead with implementing test automation. There are many more compelling benefits for and some of these benefits are soft and difficult to measure. Releasing poor quality software can bear negative financial and brand name consequences to the departments deemed responsible within the organization and to the organization as a whole.

A benchmark comparison conducted in 1995 by the Quality Assurance Institute (QAI) analyzed the specific difference in effort, measured in man-hours to perform testing using manual methods as compared with using automated test tools. The testing involved 1,750-test cases that uncovered 700-application defects. The results reflect an overall 75% reduction in the software testing lifecycle.

This paper provides guidelines for quantifying the...