Archive for June, 2011

Software Quality – Economics of and the art of Elephant spotting;


This year our
SQNZ AGM also falls on budget day. I am writing this before the budget is
released but all the indicators from media and official sources seem to
indicate this will be a budget that is tough on expenditure and big on reducing
our deficit. All good in theory but if the behaviour that gets driven is to cut
costs by reducing the level of resources dedicated to improving software
quality (which includes replacing poor quality systems with better quality
ones) then the potential benefits of improving NZ’s long term economic
performance will not be as great as they could have been.


Software expenditures and potential software quality impacts on the NZ


It’s hard to quantify just how much a lack
of software quality can cost us as a country.
A most likely source of reliable information probably comes from
Statistics NZ’s Information and communication technology (ICT) supply survey
which was released in the last month or so. If we look at the Statistics NZ
website and download the right set of tables we see that;

In NZ in 2010 we spent 1.2 Billion in 2010 on
published software – 8 % up on what we spent in 2008;

In NZ in 2010 we spent nearly 1.2 Billion
on  ‘IT design, consulting, and
development services’ – 3% down on what we spent in 2008;

In NZ in 2010 we spent 1.3 billion on IT
technical support services – 7 % up on what we spent in 2008;

Keeping in mind
that these expenditures and changes in expenditure have been occurring against
the backdrop of the Global Financial Crisis in a country that has a ‘nominal’
GDP of 190 billion then the 3.7 billion we are spending on the three items is
arguably significant. So how much can we increase our ‘effectiveness and
efficiency’ as a nation by increasing our focus on software quality? I believe
the answer is ‘who knows’ but I would lay odds that given current levels of
related expenditure against nominal GDP it would be a significant amount for
our small island trading nation. Certainly worth a bit more focus than what can
be provided by our small voluntary group and
a handful of others.


Is that it then
? – we know it is probably a big number but have no idea what it is ?


Not entirely – its
actually worst than that – the big number gets bigger when we consider the ramifications
of poor software quality on the wider economic performance of the country. This
poor performance can be traced back to the three stooges of time, cost and quality.


Wider Economic Costs – The Three Stooges of Time, Cost and Quality


Software quality, or more appropriately the
lack of it, can cause;

  • Time delays that generate a myriad of other
    impacts on the NZ Economy;
  • Costs associated with fixing things ‘after the
    fact’, working around defects the impact on productivity;
  • Quality problems that cause us to miss out on
    opportunities to lift our performance because we lacked a required capability
    or because poor quality software caused us to just plain get it wrong;


The impact of
the ‘three stooges’ on our wider economic performance must also be significant
even though its effects are largely invisible in the myriad of productivity and
expenditure statistics available.


How do we address this?


Borne out of
cost benefit analysis approaches the first step many take is to attempt to
quantify the economic impacts of software quality. This generates debate in
itself about the approach that should be used with the inevitable impacts on
credibility and getting clear directions for getting results.

To draw a
parallel – we know the cost of crime to our economy is significant, that’s why
we invest in a myriad of law enforcement agencies. When Robert Peel set up the
first Police force he and his supporters didn’t have a treasury report telling
them what the likely costs and benefits were.
They just knew from personal experience that something had to be done
and managed to persuade others that a Police force could provide a part of the
solution. I’m not suggesting we set up a quality police force but what I am
suggesting is that we need to keep articulating that for the NZ Economy there
is a significant upside from investing in software quality via avenues

  • Investing in Application Lifecycle management
    tools now available from the likes of IBM, Microsoft, MicroFocus, HP and
  • Investing in better training for those who can
    have a positive impact on software quality in their professional lives;
  • Getting the message out to software customers
    that poor software quality is not acceptable and they shouldn’t just put up
    with it because the contract / EULA they acknowledged told them that they
    couldn’t do anything about it – protections like the Consumer Guarantees and
    Fair trading acts do apply;


I’ll leave it up
to those better qualified than me to debate how we quantify the costs and
benefits associated and whether or not decision tables can play a part in
improving the situation. I just know that there is an elephant in the room
because common sense based on the data and information tells me it is there and
I am having to clean the carpet all the time.


PS: You can find
details on the 2010 Information and communication technology (ICT) supply
survey results from the Statistics NZ site at this address – http://www.stats.govt.nz/browse_for_stats/industry_sectors/information_technology_and_communications/ictsupplysurvey_hotp09-10.aspx





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