As you look to adopt an automated testing process to meet the rising demand for faster delivery cycles and bug-free releases, it’s vital to assess whether the return on investment (ROI) is worth the change. Before executing, or even thinking of building out an automation strategy, you’ll want to calculate the net gain you’ll see from transitioning. Divide this by the net investment needed to transition (i.e., the tools and resources you use), and you’ll get your ROI for automated testing.

The equation to measure ROI of Automated Testing is –

Automation ROI = ( Gains- Investment ) / Investment

The six ways to Measure ROI of Automated Testing:

Start by breaking down the ROI equation into two parts and review how to calculate your Gains as well as your Investments.

To establish ROI, first compute the following six costs and reduction in costs. We’ll go through the measurements you need for each and the top guidelines to follow.
1. Automation of New Tests
2. Automation of Prior Tests
3. Coverage Across Environments
4. Defect Leakage
5. Test Redundancy & Reuse
6. Knowledge Leakage

Automation of New Tests

The typical first step when developing an automation business case is to consider what it will take to automate new test cases. How long will it take to create, run, and keep up an automated test? You must choose which tests may be automated and which ones should be performed manually in this step. You should also factor in the hourly rate of the team members who are performing the tests in order to determine the entire cost.

Best Practices for Automating New Tests-

  • Don’t think of you ROI as automated vs. manual.
  • Factor in team members conducting both manual and automated tests.

Automation of Prior Tests

Calculating the cost of automating your previous test cases—your regression tests—is the second stage in creating an automation business case.

Regression testing involves rerunning older tests to make sure that newly added or removed bugs haven’t been accidentally introduced or reintroduced. Regression testing is essential to your success since it will enable you to make sure that problems are kept at bay and that product features that have already undergone validation continue to work as intended. These test suites will expand and become more time-consuming over time. Automating this process will enable you to perform regression tests more quickly and increase your confidence in the upcoming release.

Best Practices of Automating Regression Testing:

  • Immediately integrate new automated tests with your existing regression testing suite.
  • Automate repetitive test cases with medium to high complexity
  • Remember to account for the maintenance and development of new test cases as an ongoing process

Coverage across environments

There is more to the ROI of automation than just taking manual and regression tests into consideration. The purpose of automated testing is to increase software quality while testing more quickly and at a lower cost. You may now conduct your tests in a wider variety of contexts thanks to the industry’s expansion in devices, browsers, and operating systems.
The likelihood is that you’re producing a product that will need to be usable across a variety of platforms unless you’re positive your end users will only be able to access your programme from a single environment. You should take into account whether or not you’re conducting tests in parallel and whether a device lab is necessary when figuring out the costs of environment coverage.

Best practices for Ensuring proper Test Coverage:

  • Cross Browser tests
  • Regression Tests
  • Unit Tests
  • Smoke Tests

Reduction of Defect Leakage

The number of issues or problems that make it into production because they weren’t discovered earlier in the software development lifecycle is referred to as defect leakage. Numerous factors, including an unfavourable or inadequate functional testing coverage, may contribute to this. The main metrics you should monitor are the expenses (in terms of both money and time) incurred as a result of having to deal with defect leaking after deployment.

Best Practices for Avoiding Defect Leakage:

  • Catch defects earlier in SDLC.

Test Redundancy & Reusability

Avoiding duplicating testing efforts is the goal of keeping track of the reusability of your tests and the duplicate procedures you’re taking. When you can reuse tests you’ve already built, why reinvent the wheel? You may enhance your testing cycles and, eventually, test speed by reusing tests.

The number of tests that were recorded more than once or that contained duplicate components, the time spent looking for redundant test cases, and the time it takes to create and run those redundant tests are all necessary to determine this cost.

Best practices for Reducing Redundant Tests

  • Build modular test scripts to enable test reusability
  • Leverage a test case management tool that can help you search for duplicate test scripts.

Reduction of Knowledge Leakage

When calculating the ROI of automation, this is frequently the measurement that is overlooked. A test engineer typically works for a corporation for three to five years on average. There is usually a certain amount of institutional knowledge lost which is lost.

It’s crucial that you consider this when developing a long-term ROI case for switching to automation. After someone passes away, some test cases will need to be redesigned, which can be expensive.

Best Practices for Reducing Redundant Tests

  • Process documentation
  • Test Case Management

Let’s review the second half of the equation – the investments in tools and resources needed to transition to an automated testing process.

Automation Investments: Tools & Resources


There are many automated testing solutions on the market today, so deciding which one is best for you can be challenging. When evaluating a tool, it’s important to consider not just how well it works and how much it will cost, but also how much time will be required to use it successfully.

How long will it take your team to get up to speed and feel confident using the product to do tests? Is it a tool that everybody can use without any training, or will some team members require additional instruction? While some automated testing solutions mainly rely on scripting tests, others allow testers with less technical expertise to develop scripts using point-and-click operations.


When it comes to resources, you’re actually estimating how long it will take for your tool to have an impact because it’s uncommon for everyone on your team to have automation experience. Either invest in hiring new employees or develop your team’s automation knowledge organically using the resources listed above.

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