The ROI of the automation testing is determined by comparing the benefits gained from automation as compared to the cost incurred in the manual process. From the developer’s perspective, the manual operations are time sluggishly.
Even after incurring the time and monetary effort into manual tasks from a group of people, there is still a major probability of pitfalls and errors. Thus, developers are shifting towards an automated testing process in an effective way.
- Increased test coverage: Automated tests can be run more frequently and on a wider range of devices this effectively enhances the test coverage ratio.
- Improved testing efficiency: Automated tests can be run faster and more consistently than manual tests. So, it reduces the time and resources required for testing.
- Reduced manual testing costs: Automated tests can reduce or eliminate the need for manual testing so it resulting in cost savings.
- Faster feedback on software defects: Automated tests can provide faster feedback on software defects, allowing for quicker resolution and less downtime.
Crucial Elements To Consider While Calculating Cost For Automation Testing
By comparing the benefits and costs, you can determine the ROI of test automation and evaluate whether the investment in automation is worth it. For a successful approach, it is important that the benefits of automation should outweigh the costs.
To calculate the costs of test automation, you can consider the following:
- Automation tools and software licenses: The cost of purchasing and maintaining the tools and software required for automation.
- Personnel costs: The cost of hiring and training personnel to create and maintain automated tests.
- Hardware costs: The cost of purchasing and maintaining the hardware required to run automated tests.
- Maintenance and updates: The cost of maintaining and updating the automation tools and infrastructure over time.
The Basic Measurement
To calculate the ROI, you need to determine the cost of automation and the benefits gained from automation, then divide the benefits by the cost. The result is a percentage that represents the return on investment.
It’s important to note that while ROI is a useful metric for evaluating the effectiveness of test automation but it’s not the only metric that should be considered. Other factors such as the quality of the product, the satisfaction of customers and the overall stakeholders’ satisfaction.
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How to measure the ROI of Automated Testing?
There are five ways to measure the ROI of Automated testing. Here are the metrics which you will need for each and the best practices to keep in mind.
5 Calculations for measuring the cost & ROI
1. To measure the cost & ROI of automating new tests
It’s important to note that the cost of automating tests will vary depending on the specific application or system being tested and the tools and techniques used.
- Initial investment.
- Development costs.
- Maintenance costs.
- Time cost.
- Return on Investment.
Let’s say that the initial investment for automating new tests is $10,000. This includes the cost of purchasing test automation software, hardware and any additional infrastructure required to run the tests.
The development and maintenance cost is $5,000 per year.
It is estimated that by automating these new tests, the company will save $15,000 per year in labor costs associated with manual testing. Additionally, the company expects to see a reduction in the number of defects that make it to production, resulting in savings of $10,000 per year in costs associated with fixing those defects.
To calculate the ROI, you would use the following formula:
ROI = (Benefit – Cost) / Cost
ROI = (($15,000 + $10,000) – $5,000 – $10,000) / ($5,000 + $10,000)
ROI = $10,000 / $15,000
ROI = 0.67 or 67%
2. The cost & ROI of automating Regression Tests
It depends on various factors such as the complexity of the application being tested and the resources required. Here is an example of how the costs of automating regression tests might be calculated:
Let’s say it takes a manual tester 40 hours to complete regression testing for an application, and they are paid $20 per hour. The cost of manual regression testing would be 40 hours * $20/hour = $800.
Now, let’s say it takes a developer 80 hours to automate the regression testing for the same application, and they are paid $40 per hour. The cost of automating the regression testing would be 80 hours * $40/hour = $3,200.
In this example, the cost of automating regression testing is $3,200, while the cost of manual regression testing is $800. However, it’s important to note that once the automation is in place, it can be run at any time with minimal effort and cost. In the long run, automation will save time and money as it can be run frequently, quickly, and accurately.
3. Calculation Of Costs Associate With Defect Leakage
The cost of fixing a defect in production is $1,000. The cost of fixing the 10 leaked defects would be $10,000 (10 defects * $1,000 per defect).
Additionally, the company may lose revenue due to defects. Let’s say the company has 10,000 customers and each customer has a lifetime value of $1,000. If 5% of customers are lost due to the defects, the company would lose 5% * 10,000 customers * $1,000 per customer = $50,000 in revenue.
In total, the cost of the defect leakage in this example would be $10,000 + $50,000 = $60,000.
So, with the implementation of automation testing – an organization can save an ample amount of money from going into the trash due to defect leakage.
4. Loss due to knowledge leakage and negative ROI in manual tasks
Knowledge leakage can occur when test automation scripts are closely tied to the implementation of the system under test and when changes to the system cause the scripts to break or produce incorrect results.
This can lead to increased maintenance costs and reduced confidence in the software testing process. Additionally, if the leaked knowledge is used by attackers then it can even lead to security vulnerabilities.
To calculate losses due to knowledge gaps in software development, you can use metrics such as:
- The extra time spent on a task by a team member who lacks knowledge.
- The extra time spent on debugging and fixing errors.
- The number of errors and defects that are introduced because of the knowledge gap.
- The number of customer complaints or lost customers because of poor quality.
5. Cost of time & ROI involved in the testing process
Let’s assume that it takes a team of manual testers 80 hours to run a set of tests for a software project. The cost of each tester is $50 per hour, so the total cost of manual testing is 80 hours * $50/hour = $4000.
If automation is implemented, it reduces the testing time to 20 hours and the cost of automation is $3000.
In the long run, the company can save the cost involvement of 60 hours per set. So, it will result in saving huge amounts of money and resources.
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Bitter Truth: Quality Assurance (QA) Staff Is Not Always Considered The Best Testers
While QAs are typically trained in testing methodologies and incorporate diverse experience in identifying and reporting defects but still they are not always considered the best testers for a project. This could be due to a few reasons:
- Lack of domain knowledge: QA staff may not have the same level of expertise or understanding of the specific domain as the development team or end-users. This can make it more difficult for them to identify and report defects that are specific to that domain.
- Limited perspective: QA staff may be focused on testing the software from a more technical perspective, rather than from the perspective of the end users. This can make it more difficult for them to identify and report defects that are related to usability or user experience.
- Dependence on requirements: QA staff may rely heavily on the requirements and specifications provided by the development team and may not be able to identify defects that are not covered by those requirements.
From the above calculations, it can be analyzed that automation testing can result in saving an ample amount of time as well as it reduces cost at the mass scale. It’s important to note that automated testing is not a replacement for manual testing, but rather a complement.
Organizations should work by integrating manual testing with automated testing to bring out optimum results. Apart from this, automation testing functions can be marked as reliable QAs.