Test Automation –
ROI Calculator

Most organizations are aware that test automation brings benefits. It is important to quantify these benefits to understand if your efforts are on the right track or you need to make some changes to leverage its full potential. However, calculating the ROI of test automation may not be a simple or straight forward calculation because automated testing improves the profitability in three ways. Cost is the most obvious parameter but significant improvements in speed and quality also add to the overall efficiency and savings that a company makes.

Our test automation ROI calculator helps you quantify and measure the total return on your investment on test automation when compared with manual testing in terms of –

Speed

Speed

Test faster, often, and more with test automation

Speed

Quality

Increase product quality by 25%

Speed

Cost

Reduce defect leakages and increase test coverage

Common Parameters

1 100,000
1 20

Manual Efforts

1 100
1 100

Automation Efforts

1 100
1 100

Calculate ROI

Test Automation – ROI Calculator

ROI - First Year

Here is your ROI for the first year with test automation. Due to initial investment in test automation tools and resources, you can see that the cost in the first quarter is significant. However, from Quarter 2 onward, it is projected that you will start getting the benefits of investing in test automation.

This is calculated based on 3 parameters – Speed, Quality, and Cost. For detailed breakup, check out each tab.

Cost Benefit
ROI
Cost Benefit - Quarter 1
$ - 53560
Cost Benefit - Quarter 2
$ 166973
Cost Benefit - Quarter 3
$ 166973
Cost Benefit - Quarter 4
$ 166973
ROI - First Year
$ 447360
When will you achieve break even Cost?
0.96 Months

Speed

While comparing manual testing and test automation, the major benefit for test automation is the test execution speed. Manual testers can work 8 hours a day and execute test cases manually. Whereas test automation tools can practically work 24 hours and execute test cases automatically. You can run a significantly large number of test cases in a short time. This results in improvement in time and cost for go-to-market.

The earlier you find a defect, the easier, cheaper, and quicker it is to fix it. Test automation enables instant detection and remediation leading to a tighter feedback loop. Teams can set up automation execution to run as soon as the code is ready. So practically, you are investing less time on testing while increasing your test coverage substantially. The key benefit of this speed is not only faster readiness of your product but also a high-quality output with fewer bugs in production.

Speed - Quarter 1
Manual
Automation
Test Authoring
23.14814815 Days
31.25 Days
Test Execution
34.72222222 Days
0.925925926 Days
Analysis & Maintenance Time
2.777778 Days
1.833333333 Days
Total
60.64814815 Days
34.00925926 Days
Total reduction in manual efforts through automation
26.64 Days
Improvement in time to market
44%
Cost Benefit due to improvement in time
$ 76720
Speed - Quarter 2, 3, 4
Manual
Automation
Test Authoring
0.00 Days
0.00 Days
Test Execution
34.72222222 Days
0.925925926 Days
Analysis & Maintenance Time
2.777778 Days
1.833333333 Days
Total
37.5 Days
2.759259259 Days
Total reduction in manual efforts through automation
34.74 Days
Improvement in time to market
93%
Cost Benefit due to improvement in time
$ 100053.3333

Quality

It has been proven that product quality increases by 25% when you align test automation with the right type of testing. Test automation helps minimize defect leakages from start to finish in the software development cycle. It also reduces the risks of manual errors and oversights. It is easy to miss critical bugs during manual testing phases only to find them in the final product review at the customer end. With test automation, you can discover bugs in the early stage of development where they are easier and cheaper to fix. Also, test automation increases test coverage as testing can be done frequently.

Quality - Quarter 1
ROI
% reduction in defects
25.00%
Cost Benefit due to Quality Improvement
$ 26200
Quality - Quarter 2, 3, 4
ROI
% reduction in defects
25.00%
Cost Benefit due to Quality Improvement
$ 16200

Cost

As shown in the calculation below, test automation looks costlier than manual testing until you achieve the breakeven point. This is mainly because of 2 things –

  1. Automation engineers are costlier than manual testers (although less automation engineers are required in comparison to manual testers)
  2. Investment in automation tools adds up to the test automation infrastructure costs

However, it is important to note that the high infrastructure cost is a one-time investment which is reflected in Quarter 1. But from Quarter 2 onward test automation starts becoming cheaper and the more viable option in the longer run.

Factors that make test automation more cost efficient include defect leakages and the scope of test coverage. When you factor in these benefits, manual testing is certainly the more expensive choice in the long run.

From Quarter 2 onwards, the automation tool implements test execution on its own. Your investment in automation in terms of test execution and human resources reduces considerably. The savings are not only monetary but also in terms of time and effort required to release a successful product.

Cost - Quarter 1
Manual
Automation
Tool Cost
$ 0.00
$ 7200
Test Authoring
$ 40000
$ 240000
Test Execution
$ 60000
$ 0.00
Analysis & Maintenance Cost
$ 4800
$ 14080
Total
$ 104800
$ 261280
Cost Benefit
$ - 53560
Cost - Quarter 2, 3, 4
Manual
Automation
Tool Cost
$ 0.00
$ 0.00
Test Authoring
$ 0.00
$ 0.00
Test Execution
$ 60000
$ 0.00
Analysis & Maintenance Cost
$ 4800
$ 14080
Total
$ 64800
$ 14080
Cost Benefit
$ 166973

Intangible Benefits

Test Frequency
Reliability
Build Verification Testing
Test Data

Back

Try QMetry Automation Studio for free and see all the benefits for yourself
Start your free trial

Trusted by teams across the globe for 10+ years

The QMetry brand is trusted by 1000+ customers globally across Finance, Healthcare, Travel, Hospitality, Retail, Education and many more.
These are just some of our customers.
Loading...