IT Scan

September 2, 2005
India - testing yard for global products

Bangalore Correspondent

BANGALORE -- Loads of software testing contracts are currently being outsourced to India. Enterprises across the globe believe that Indian providers, with their strong process, domain expertise and quality focus, are capable of effecting significant enhancements to products and solutions. As a result, India is steadily becoming a key hub for software testing outsourcing. The segment, that is likely to cross US $1.5 billion in the country by end of this year, is growing at 92 percent per annum. Globally, testing is close to a US $14 billion business (over 30 percent of the US $48 billion global outsourcing market).

Software quality assurance testing is an integral and critical phase of any software development project. Developers and testers must ensure that newly developed products or product enhancements meet functional and performance requirements and that those products are reliable and able to operate consistently under peak loads. The risks of releasing a product that is not yet ready are greater now than ever before because of the change in expectations and demands of the end users.

According to the Standish group's research report on Project Failure and Success, nearly three out of four software projects are either delivered late, over budget or are cancelled before being completed. This is true despite the involvement of experienced managers, developers and testers in the project. This is a problem that continues till date. The anxiety induced by the question "Are we ready to release?" affects every member of the team. Management dreads having to ask it for fear of hearing an unqualified "No" or even worse.

Today, with testing being a "countable" revenue stream, many domestic IT firms forked out special business lines for this niche. Revenues from testing related services are currently in the range of 5 to 10 percent while these are likely to grow between 15 to 25 in the next couple of years, say market analysts. By that time, the country might require an additional software testing talent pool of 30,000, against a similar number currently.

Gartner India vice president (research) Partha Iyengar said: "Testing is one of the fastest growing service lines in the offshore space. It is an area where clients spend anything between 30 to 55 percent of their resources. This is perceived as a useless cost, since it does not directly add value to their products. Testing, therefore, is an obvious target for outsourcing."

So that's what keeping Indian IT companies increasingly busy these days. Large number of MNCs across the US, UK, Europe and Japan are willing to outsource testing to Indian companies. In addition to the business proposition, it also offers "foot-in-the-door" penetration opportunities to Indian companies. Along with several stand-alone software testing companies like RelQ, ThinkSoft, Verisoft and Ready Test Co., pure-play IT firms like Wipro, Infosys, TCS and Patni are betting high on the segment. Currently, there are two major industry trends adding to the pressure. The first is accelerated release cycles. As Business Week put it, "A year's worth of change happens in a couple of months-a pace known as 'Internet Time.' And that's the problem. The whole industry is operating on Internet Time...".

Second, while releases are more frequent and cycles shorter, the cost of failure has increased dramatically. Just a few years ago, when client server products were at the cutting edge, releases were either annual and the expected number of users was known well in advance, as all of the users were employees. An organization could mitigate a system failure with a manual backup; for example, orders could be taken by hand while the system was down. However, as huge portions of the business were overhauled and these systems addressed larger user populations, releases became more frequent and system failures commonly meant that no orders could be taken at all. Today with E-commerce applications, releases can occur two or three times per month. Now, the user base is a large but unknown number of customers, not employees. System failures are highly visible and can cause customers to run to the competition.

"These trends have several serious implications for project managers. The high-cost of failure means that deploying untested software is simply not an option. Additionally, every aspect of quality needs validation, not just one or two. Accelerated release cycles drive the need for automated testing in which tests are easy to create, maintain and reuse. There is just too much to do in too little time to rely on manual methods," said Gangadharaiah C.P., vice president, Interop Solutions, the testing arm of Wipro Technologies.

A continuous approach to quality, initiated early in the software lifecycle, can lower the cost of completing and maintaining the software significantly. This greatly reduces the risk associated with deploying poor quality software. Pradeep Waychal, head, corporate quality and delivery innovation, Patni Computers, said: "As the technology stack gets increasingly complex, the user community becomes vulnerable to defects. This scenario has given rise to a huge demand for independent software testing services."

"We see a bigger traction in the testing business. It's going to be measured with respect to top and bottom line revenues of companies," added Gangadharaiah. Wipro, currently employing over 3,000 people in testing, sees the space as an independent revenue stream.

In fact, software glitches cost around US $60 billion in the US alone. Offshore remote application testing can cut cost of quality upto to 75 percent, noted a recent AMR Research.

Not all organizations have the expertise or resources to carry out the software testing process. Software testing is essential but it is definitely not the core activity of most organizations that require it. Outsourcing will enable a company to concentrate on it's core activities while software testing experts can handle the work efficiently, ensuring quality results. The company will save time and money on a process that would otherwise be too tedious and exhausting if performed in house.