Quantifying the Return From Improving Software Quality

April 4, 2012 — Posted by Al Shalloway

This is the second part of a three part blog series:

  1. The Cause of Poor Software Quality
  2. Quantifying the Return from Improving Software Quality
  3. How to Improve the Quality of Your Software While Improving Your Time to Market

How does one quantify the return from improving software quality? Quality relates to growing and retaining an asset – your client base. What's the actual cost of obtaining, retaining and re-attaining lost clients? What's the cost in revenue of losing a client? Client retention not only requires high quality products, but the timely delivery of new and/or updated products. Delays in your process not only has the indirect effect of lowering quality but also significantly slows the time to market the extensions to your product base. Both affect your bottom line directly.

Quantifying the effect of improving your software quality must include:

  1. the extra time the development team will have to work on real value once the level of failure demand is lowered
  2. the effect on the mindset of the clients by having a better product
  3. how reducing the complexity of the codebase will allow for quicker enhancements (and how this effects your clients)

It's important to understand these issues when considering quality because the quality issue is much more than how many bugs occur, how long it takes to fix them or how much burden they place on the development team.

Companies not doing Agile and acceptance test-driven development can expect a 50-80% improvement in the quality of their product. When looking at how to measure the ROI of improving quality, one should consider the following:

  • how do code defects effect your clients' perception of your software?
  • how does the extra burden of code defects and the delays in your process increase the time it takes to deliver new features and products - and how does this delay effect your clients' perception of your firm?
  • what would the effect of a 50% reduction in defects be on the perceived quality of your products to your clients?
  • what would the effect of a 50% reduction in defects be on your time-to-market and how would your clients respond to this?

The cost of actually improving quality and reducing delays may be less than you think. More importantly, benefits can happen quickly, off-setting the investment required for sustainable improvement. How to do this is discussed this in the third part of this blog series – How To Improve the Quality of Your Software While Improving Your Time-To-Market.

Alan Shalloway
CEO, Net Objectives

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About the author | Al Shalloway

Al Shalloway is the founder and CEO of Net Objectives. With 45 years of experience, Al is an industry thought leader in Lean, Kanban, product portfolio management, Scrum and agile design. He helps companies transition to Lean and Agile methods enterprise-wide as well teaches courses in these areas.



        

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