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How an Effective Functional Test Automation Improves ROI?

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Being a well established qa software testing company for the past many years we have been evolved in designing well
structured ROI metrics for our clients, so based on that let me give a little bit more insight about how an effective
automated tests can drastically improve the various factors of ROI(calculation of reduced Defect leakage, evaluation of
investments and gains over the time etc) which really helps in managing the cost and resources effectively.

Let's take a look at some of the best practices that leads to an effective ROI:
1. Planning automating test only when product's build is stable.
2. Planning on automating the priority scenarios and the ones which are repetitive cause ultimately they will be becoming regression tests.
3. Investing on resources that are hybrid so that cost and time consumed in hiring individual automation and manual test
engineers would reduce.
4. Start automation tests creation at an early stage which can lead to reduced average cost of testing hours.
5. Implementing testing frameworks that are independent of environment and OS setups.
6. Keeping track of all the test under a good test-case management system. etc

Some basic formulas that are used in evaluating ROI:
1. ROI for testing automation = (Investment value – Investment cost) / Investment cost
2. Defect leakage = (Defect count identified by customer / Defect count identified by tester before deployment – Number of invalid defects) * 100
3. Investment calculation = Automated test during development time + Execution time of automated test + Analysis time consumed in Automated tests + Maintenance time for automated test + Manual test case execution time
4. Gain = Manual test execution time or analysis time * Total number of test cases (manual+automation) * Period of ROI / 8
5. Reduction in risk=(Rate of annual occurrence) * (Expected loss in money at a single event) * (Reduction in risk occurrence probability after implementation of risk control)

I hope my answer helped. And any other assistance you can always look forward to our software testing services company 



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