Are Test Budgets Falling? WQR Thinks They Are

Are Test Budgets Falling? WQR Thinks They Are

According to our friends at the World Quality Report (WQR), test budgets are falling. At least as a percentage of overall IT spend. But are they really? I’m not convinced.

Specifically, the WQR 2021 claims that over the last 5 years test budgets have fallen from 35% to 22%, as a percentage of overall IT budgets.

This is a 5-year period that has seen continued growth of tech, an explosion in online devices and activity – even your local takeaway has an integrated technology solution.

The WQR Figures Show A Significant Fall in Test Spend

If you look at the WQR numbers in a bit more detail, a relative decrease of 13% is even more significant than it initially appears.

A 13% fall in relative spend represents a 37% fall in actual testing spend

Assuming IT budgets have remained relatively static that is, and here’s why:

Let’s say your overall annual project budget is £1m

  • In 2015, testing was 35% of your £1m budget: 35% of £1m = £350k
  • In 2020, testing was 22% of your £1m budget: 22% of £1m = £220k
  • Over 5 years, testing spend has fallen by £130k (350k - 220k)
  • Therefore, testing spend has fallen by 37% (130k/350k) 

According to the WQR then, there has been a 37% fall in actual testing spend. 

These are startling figures and I just don’t buy it. Does this massive decrease in test spend ring true for you?

People Are The Biggest Cost

We know that in all IT projects, people are the biggest cost. Have IT teams grown massively in the last 5 years? And without any additional testers?  I have not seen any evidence of this, have you?

Alternatively, are there fewer testing jobs than there were? Are there loads of unemployed testers running around looking for work? I don’t think there are.

The WQR Numbers Do Not Represent Normal Companies

To understand these numbers a bit more I looked at the sample population – just who are being interviewed for this document? 

2 interesting facts instantly jumped out me…

  1. The WQR only interviewed 155 people from the UK. Even if they were all from different companies, that’s a fraction of the total UK market. There are over 300 banks in the UK alone, never mind other sectors.
  2. The WQR only samples companies with 1,000+ employees. In fact, 75% of those interviewed came from companies with 5,000+ employees. 41% came from companies with 10,000+ employees!

Perhaps the stated decease in test spend is realistic for these groups, but I seriously doubt it. And it’s certainly not representative of the companies I speak to.

Tech Has Never Been More Important

The UK is in the grip of the biggest economic recession in 300+ years, but even with this pressure we're seeing growth in the software space - and lots of it in testing. Even non-IT folk like Fatima the ballerina are being persuaded to get tech jobs.

It’s also reasonable to state that IT has never been more important to brand reputation – nowadays a crash or system outage is a major news story. 

Surely then, the percentage spend on testing should be increasing. Decreasing testing spend now could be dangerous.

Reducing Test Spend Could be Dangerous! 

The WQR numbers just don’t stack up, not for most of us. Worse than that, they’re actually dangerous. They’re encouraging companies to spend less on testing. Is this sensible in a world where IT complexity, rate of change and the impact of software failure are all increasing?

If a stakeholder were to read the WQR, they might reasonably come away thinking they're doing something wrong. They might use this as a catalyst to reduce spend on testing - as if it's not squeezed enough anyway.

What Do You Think?

Have you seen a significant fall in the number of testers, or test spending? I’m interested to know what you’ve experienced.

It would be great to know what you see in your organisation. Do you share my concern, or have I got this wrong?

Get in touch directly, or post a comment below

Stephen Davis
by Stephen Davis

Stephen Davis is the founder of Calleo Software, a Micro Focus (formerly HPE Software) Gold Partner. His passion is to help test professionals improve the efficiency and effectiveness of software testing.

To view Stephen's LinkedIn profile and connect 

Stephen Davis LinkedIn profile

16th February 2021

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