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Test automation can significantly boost efficiency by streamlining repetitive tasks, reducing manual errors, and enabling faster testing cycles.
The extent of ROI depends on various factors like project size, complexity, and effectiveness of test automation implementation. In this guide you will read ways to measure ROI, tips to improve ROI test automation, and explore various metrics and practices for test automation ROI calculation.
Testing is an integral component of creating high-quality software and technological devices, from the testing of computer code to rigorous system audits.
A timely and appropriate testing process ensures that products function as designed without bugs or vulnerabilities compromising them; its purpose is to demonstrate and increase return on investment from test automation solutions.
Testing can be conducted manually; however, automation in testing has become an increasing trend to save time and manage business expenses associated with product development processes and QA operations.
Manual testing is slower and less efficient than automated testing; as a result, businesses may reduce QA teams or use testing staff more productively on other tasks due to this difference. Automated tests can also be run more regularly and consistently than manual ones, increasing business productivity.
What Is The ROI Of Test Automation?
The relevant software testing process describes Return On Investment as "a measure that indicates how effective automation will be within QA workflows".
Calculating ROI can prove valuable in various ways:
- ROI helps you assess the financial implications (positive or negative) of investing in automation for your business, providing insight into when your investment will pay back and outlining all its possible gains and losses.
- Last, it will help improve your business presentation to potential investors and encourage them to support your plans.
Subtract estimated costs from estimated benefits, divide this result by expenses and multiply it by 100 for an ROI calculation.
Results will provide a percentage figure representing the expected return on investment in regression test automation, representing savings from manual testing to automated. Costs represent investments required in designing tests and setting up environments; both benefits and costs can be expressed either monetarily or time scale-wise as the benefits can be quantified directly against actual costs (i.e.
money, saving opportunities or time held during the design of automated tests).
Savings as a result of automation, decreased financial risks (for instance, potential troubleshooting costs should a product release be defective), time saved through automating tasks, and money saved in salaries of staff performing manual tests are among its many other advantages.
Essential Metrics To Consider Before Calculating ROI Test Automation
Before calculating ROI with test automation metrics to consider initially, to successfully evaluate test automation ROI, you need a solid understanding of test automation ROI metrics that could affect its value.
Before beginning the evaluation of ROI calculations for test automation, use the following as guidelines for evaluation:
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Cost: Cost is one of the primary drivers behind switching from a manual to an automated testing approach.
Due to the set-up and installation times of automation tools, cost reduction may take time to become evident, but it indicates long-term cost reduction.
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Time: Your testing team consists of experienced individuals, but much of their time is wasted creating and running manual test cases.
This represents a substantial loss for SMEs: spending too much time writing manual test cases detracts from essential business operations.
With regards to start-up companies which depend on teams performing at maximum potential, ROI is far more than cost/benefit calculations;
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Quality: Test automation that produces error-free products quickly is one measure of return on investment (ROI), including quality as one metric.
With no chance for human errors and increased possibilities of automating redundant tasks, test automation improves product quality and overall customer satisfaction.
Read More: QA Automation: Worth $1M In Savings? Benefits Vs Challenges
Tips To Improve ROI Test Automation
Implementing test automation must follow these guidelines to bring the desired results, however. Instead, improve your chances of increasing test automation's ROI:
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Decide What To Automate: Automation can be beneficial, but over-automating everything wastes time and money.
Make an educated and deliberate choice regarding which tasks should be automated to save both resources on installing or maintaining tools or systems that serve no actionable purpose or are insignificant to business ROI.
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Create Testable Products: If your end product cannot be tested manually or via automation tools, switching will not help you.
Instead, your goal should be creating testable applications that provide gateways for automated tools to test their functionality.
- Use Standard Test Automation Tools And Frameworks: Utilizing industry-standard test automation testing tools and frameworks ensures your product satisfies regional regulations while meeting user interface and stakeholder expectations.
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Prepare Reusable Test Cases: Automation allows testers to create test cases rapidly they can reuse over and over, freeing QA engineers to spend less time repeating old claims while expanding on them and checking different aspects of a product or service.
It has an immediate positive effect on the ROI of test automation by allocating critical business requirements resources more effectively.
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Prioritize The Right Tasks: If you have five test cases to automate, prioritize those with the highest priority first.
If user interactions are waiting on specific features which have been delayed in release, simply automating and running those cases at random will have an effectual impact on ROI.
Ways To Measure ROI Test Automation
Calculations that show how time can be saved when switching from manual acceptance testing to a test automation process are one way to measure ROI for automated testing; more complex calculations focusing on efficiency and risk reduction may provide another.
Basic ROI Calculation
At its core, ROI measurement involves estimating how much time can be saved by automating tests over a specific period rather than performing manual ones.
Writing automated tests for Software quality being created (for instance, quoting Software performance for small businesses) by an organization could take 250 hours of effort and time. No matter the device or software application chosen, the manual testing strategy could save up to 20 hours each week, thus recouping its initial investment within 13 weeks of initial use.
Calculating ROI in financial terms requires multiplying time values with the hourly rates of developers and manual testers, and then setting an evaluation window; for instance, if developers earn twice more as manual testers, it will take approximately 26 weeks of automated functional testing implementation before you see significant savings from investing in automation testing.
Keep in mind that this calculation is simplified; more parameters may need to be considered to improve its accuracy - for instance, time spent upgrading and maintaining tests, savings gained due to eliminating mistakes made during manual tests, or gains achieved due to large-scale automated test coverage are all potential considerations when measuring return on investment (ROI).
Calculation Of Efficiency Of ROI
An advanced strategy involves calculating an efficient Return On Investment and prioritizing time investment gains.
Here is an example of an ROI formula:
- Investment = Automated test script development time + Automated test execution time + Analysis/maintenance time = Manual test case execution times.
- Gain = Manual test execution time or analysis time multiplied by total test case count (automated + manual), multiplied by period of ROI/8.
This approach relies on certain assumptions, including a visual testing automation framework replacing manual usability testing entirely and only needing one tester for a manual testing environment.
Due to these being uncommon conditions, this calculation should serve more as an approximation than a definitive judgment.
Risk Reduction ROI Calculation
The formula for Calculating Return On Investment (ROI):
- ROI = (reduced monetary risk - cost of risk management) / cost of risk management
Calculating monetary risk reduction requires subtracting the cost of risk control from the annual risk occurrence rate and dividing that result by the price of risk control, then dividing by benefit; the reduction here represents how automation technology reduces monetary risks that companies would otherwise experience due to manual testers being more likely to make errors than automated technologies are.
ROI Calculation - Other Things To Consider
Consider other variables that could alter your calculations regardless of which approach is taken; for instance, the impact of automation of specific processes could influence other operations that must also be considered; an example would be automatic functional test report generation, which reduces time and costs associated with producing quality assurance documentation.
Not all tests can or should be automated; only consider automated testing when it can provide significant advantages over manual.
In other instances, manual testing activity would continue, and some staff for that type of work would remain. Should that be the case for your organization, make the appropriate calculations and adjustments resulting from that circumstance.
Reusing specific tests, mainly automated regression testing efforts, can bring additional savings in operations since automated tests tend to be far more accurate than manual ones. Thus, implemented automated testing can save you money on bug fixes and bug fixing costs.
Ensure The Precision Of ROI Calculations
Calculating ROI for test automation projects may initially seem complex and may prove a formidable undertaking. It would help if you were first mindful of some subtle issues that could compromise its accuracy before proceeding further with calculations.
Starting, it may be impossible to accurately ascertain some aspects of your calculations that involve money, such as fixing errors that will never arise due to automated unit testing methods or improving website credibility or product quality.
Second, some parameters may change with time in unexpected ways - for instance, the cost of access to third-party simulators/emulators/real devices and maintaining and training an effective testing team.
Automated exploratory testing does not ensure 100% accuracy; some bugs must still be identified and resolved occasionally. Also, remember that adopting automation does not equate to eliminating human testing personnel. Instead, you still require teams of personnel dedicated to automated tests and manual testers on occasion.
Conclusion
Calculating ROI test automation investment may seem complex; however, to do it effectively requires extensive investigation of your company and product and types of testing requirements and processes.
You must then select an appropriate calculation method while identifying relevant parameters and considering any external influences that might interfere with or alter calculations.
However, as long as this process is carried out correctly, you'll get an invaluable metric: an expected return on investment for automated testing implementation.
With that information at your fingertips, making a sound investment decision becomes possible. At the same time, external investors can also see its figures.
