The stepson of IT will now have his day. Till 1998, when RelQ
first set up shop, testing was very much the untouchable, the ignored, the
lonely. He is still unglamorous, but changing trends will soon make him
fashionable, many vouch. And India will be its unmistakable lounge.
The US and Europe first came to India for manual testing. Then
it was for automation. Now, it's time for complex software testing and
value-adds. And it's also time for growth as the strong offshoring current
promises to wash ashore 70% of the world's outsourced testing market of $6.1
bn. The changing trend, we referred to, is mainly in terms of customer mindset.
They are able to save 70% of their costs by outsourcing testing to third party
vendors. And in a highly fragmented market, where putting a cap on the market
size is little more than a 'guesstimate', some analysts have quoted just the
current Bangalore market at $400 mn-the city has around 20,000 test engineers.
Some of Indian biggies have ramped up their testing teams
significantly over the last one year sniffing good business, even setting up
separate units after realizing the value derived by its clients from independent
testing services. So long the forte of small companies, the entry of big guns
into independent testing is a real test of character for many, experts say. The
changing market dynamics have already resulted in consolidation-Disha merged
with Aztec and Cognizant was in talks with RelQ not too long ago-increased
investments, not just in processes but also into training, and frenzied searches
for quality manpower. (There is no curriculum on testing in our engineering
colleges.)
And there are assertions galore. The smaller companies feel the
big guys have no depth of testing focus, busy as they are sniffing the next $5
bn opportunity. The big brothers tell the young cannot scale-it has to be
acquired to grow or remain small forever. On the other hand, the mid-sized
players, with both the focus and the ability to scale, simply smile, imagining
being the winners.
Managing growth, it emerges, is now the single biggest challenge
before Indian testing players, as they try to balance customer expectations with
realistic automation plans. There is a great business for everybody, but someone
might just loose his shirt.
Small Is Cute, But...
Some of the large-scale companies into software development and services-into
maintenance, application development and outsourced R&D-added one more
product line to their services, independent testing. It is one way of
capitalizing on their existing customer base to get more wallet share. But what
happens to smaller companies like Stag Software and others, who are into pure
play testing?
It sees increased competition (when Stag currently pitches in
for a project, it usually has four to five players on the competition table) but
none that it cannot overcome. "Specializations should happen in terms of
domains and there are companies even today that specialize in specific verticals-banking,
usability testing, load testing-and they will continue to do so," says
founder Ashok T. Somewhere down the line, he feels, if you are a smaller
company, the pitch will be in terms of what you have to offer in a particular
domain. The answer will be in becoming a niche player in a certain business
vertical or in a test vertical.
When bigger players capitalize and smaller players feel the
heat, a certain amount of consolidation will happen. Though no big consolidation
moves have happened just as yet, there are enough indications of challenging
times ahead for smaller companies. "Smaller companies will remain stagnant
or go out of business because they will lose employees who would want to work
with companies that grow. A lot of people come to us and say they are doing
boring work. You can focus on a niche and survive, but you will stay small and
uninteresting," says Samir Bodas, CEO of Disha, now an Aztec company.
When Disha was thinking what to do next, sometime early 2004, it
realized it should either be a consolidation or a dash to the finish. It had
several options on the table and one of them was a term sheet from a VC stating
that it would put money into acquiring some testing companies. "We
evaluated a lot of testing companies and we didn't find the right DNA, the
right quality of company that can be build into a 100 mn dollar test business.
The second option was to get acquired," says Bodas.
Discussions with Aztec started in April last year and the
announcement came in September. "The reason why we did not entertain
discussions with large players was because it would be very difficult for them
to focus on a $50 mn to $100 mn business, when they are gunning for $2-3 bn
dollar revenue. It will always be an interesting niche for them but never a
focus area," he adds.
Aztec is adding 100 people every quarter and more than 50% of
this are testing people. Its total test strength is now close to 1,100 and the
company services some of the largest ISVs in the world-Microsoft, HP, Yahoo,
and AOL-among others.
Indeed, getting the right people is a challenge that few
companies can ill afford to ignore, more so the smaller ones. The capital
required to raise a huge army just might not be there. And without people, there
would be no business. But getting people with good knowledge of testing is a
broader and more important issue for the industry right now, handicapped with
'zero college curriculum' on the subject. "You need a large investment
internally or work with universities and colleges so that you get the right
pipeline," says Bodas. Aztec has made a very large internal training
investment and its R and D groups are working with universities, sponsoring
internships.
An even bigger problem, perhaps, for smaller companies is
attracting the mid-level talent. "You need to have a good pyramid so that
good talent sign up. That is where a lot of smaller companies have failed at.
The limiting factor here is not necessarily people. It is how well you want to
build the organization," he tells.
LogicaCMG is a good example. It has plotted career paths that
can potentially take a consultant over time from basic test execution to
managing director, with stops on the way. For example, an employee there can
explore specialist skills development, consultancy, service management and
sales, besides making testing a genuine career path with a huge dose of variety.
But even with training, maintaining the right competency levels
of staff is quite a challenge. Testing expert VK Kripanand says the testing
processes in most organizations are not empowered. The top management has to be
more sensitive to quality and one measure that helps in it is the testing
process. "Support by the top management to empower testing teams to put
critical stops at relevant times will be crucial for delivering quality
products. Market demand, competition and revenue considerations force management
teams to ship out low quality products that are not certified by test
teams," he notes.
Testing houses in the past have employed newcomers in the
testing domain and thus have not been able to handle situations as well as it
should have. "Testing is a critical activity and demands creativity and
experience. The industry is catching on and a lot of domain experts are now
looking at testing as a career option," he adds. It is important that the
industry recognizes this fact and encourages a transition path to help itself
evolve.
Problems of scaling up and getting the right people might be
addressed if the market opens up further. But there is also a need to get
well-tuned sales personnel as of now. While survival could be tough, smaller
companies do not agree there is no future for independent testing. "In all
the accounts we deal with, we have not encountered any of the large players till
today. Second, the market is opening so much, if I had another 400 people today,
I would have business for them," says Dr Prakash Mutalik, a group president
at RelQ. Most of his clients, he says, prefer dealing with independent companies
for a simple reason: most accounts RelQ deals in have multi-million dollar
software development involved and handing over the job to the same people who
have developed the software wouldn't ensure an unbiased job. This viewpoint is
backed by some companies like Lionbridge, which says that customers who look for
independent verification and validation services usually turn away from the
vendor providing the coding services for the application. "Say, if Infosys
is providing the application development services for an application, for the
testing part customers prefer to look for a vendor who is not the developer of
the application. It is here that small independent companies gain
respectability," says a Lionbridge spokesperson.
This contention will not hold water always, as testing teams at
big companies like Infosys is known to report directly to the Quality Assurance
management of its clients and have no reporting line into the development side
of projects, thereby providing clients an impartial assessment of production
readiness of the solution.
Give Me More
Meanwhile, a different challenge for testing players is the rising customer
expectations. They expect SLAs, and more value-added work out of Indian vendors.
Things like performance engineering. However, performance engineering is a very
specialized task, needed in the last three to six months of the product
lifecycle. And it is difficult to find these specialists. "What ISVs want
from us is helping them architect for performance, test for performance and then
do performance engineering. They want security testing, penetration testing,
which is to see if the product is susceptible to the top ten vulnerabilities
people are aware of. Sustenance engineering is another area people are
interested in," says Bodas of Disha.
To keep on getting business, companies perhaps need to think
about testing from an engineering point-of-view, rather than service, as Disha
or Stag is doing. "The people in large companies are maintenance people;
they take huge batch of test cases and run them again and again. But customers
will get stickier and give you higher value-based pricing if you do
value-adds," he adds.
Stag's Ashok T says his primary interest is to see if his
organization can come up with techniques and methods supported by tools that can
guarantee the quality of a software. "The intent is for a more scientific
way to test software. Over the last five years, we have applied various methods
for customers in many domains. We have distilled the whole thing and called it
Stag Test Engineering Method. This method will take us close to promising that a
software will not have any major issues," he says.
Another role that customers now take for granted from the Indian
vendors: advisory services. This is more true in cases of automation where CTOs
and CIOs need to be educated at times. Customers and some development teams
often have a misconception-automating is easy and inexpensive and it is
inexpensive to run, but you can't automate till you perfect the manual
testing. Initial effort in automation is very high and outfits like RelQ have
100 people who work solely on automation. Since licenses are expensive, one of
the first things a vendor has to tell his customer is what not to automate.
Though it is true that automation improves productivity, it can be misleading to
say that it is the only strategy to release products early. Depending on the
nature of the application, the amount of reusability and the architecture of the
application, a testing automation strategy could be worked out. "Companies
that are less experienced in this domain are the ones who probably get
misinformed and make plans that under deliver or over promise," says
testing expert Kripanand. The contribution by testing automation tool vendors in
this area is now happening, thus leading to a better situation than in the past,
he adds.
Testing houses are always challenged with the varied
requirements of end users. The nature of applications and the technologies used
is the biggest issue for automation. "Consider an application developed for
a BFSI segment. The technological considerations here are quite high: some may
be on Microsoft technologies, others on Java. Even some may be based on Internet
technologies with multi-tier set up. The testing automation needs for these
applications from a domain perspective are the same, but the automation
processes vary on the technical front," explains Kripanand.
Organizations are thus faced with the challenge of capitalizing
on this knowledge gained and the putting the same to use in future projects.
"A solution area that some companies are working on is on building a
testing framework for various technologies/domains with a lot of reusable
components put together," he informs. This when matured will help
organizations put together a testing project more rapidly in future.
But problems with automation for smaller players go beyond
technological considerations. Lionbridge says monolith test automation tool
vendors always target the end-user market and tend to be unfavorable towards the
middle-tier vendors who offer testing services for end users. This results in
small and medium-sized organizations not being able to offer the tool plus
services as a package to end-users, which results in high-priced solutions being
offered to end-user customers. For example, some tools are site centric and
project centric, as per the terms of purchase. So, a license purchased for a
particular building of an organization for some project cannot be used for
another project in the same physical building.
Managing director of Mercury India T Srinivasan, however, says
as long as the user understands that there is an RoI involved and he gets back
returns, the challenge disappears. "The challenge is understanding the
applicability of these tools, how they play in the application deployment and
change lifecycle, and the ability to get the expectations right in terms of what
can be automated," he says.
When one talks of process delivery, for example, automation
lends itself well because it gives a set of skills to hold good in terms of the
process of quality itself. "It is a combination of the implementer and the
customer's understanding of the need to get automation done. It's a
challenge on education, challenge on the implementer, challenge on the
environment, and challenge on the customer's mindset to get it done. You
mitigate the chances of failure by automating," he adds.
Indian testing houses, he says, shouldn't fall prey to
throwing more bodies of problems. The ability to raise the volume of automation
is critical, he says, because customers are looking at enabling the quality
processes rather than just getting low-cost services. "In the long term,
just as some European IT companies have become vulnerable to offshore companies,
Indian test houses are likely to become exposed to new entrants if they sell
purely on the cost angle. These companies will have to continue to move up the
value chain so that price is not an issue-and that requires investment,"
explains Alex Garrick, general manager of managed testing at LogicaCMG.
There are subtle indications of people in testing preparing to
do exactly that. The industry is witnessing a sea change in its commercial model
and methodologies. The hope is, it would be an exciting place to work soon. With
more people flocking this area, it would effectively ward off geographical
competition from Eastern Europe and China. And independent companies can hope
for more glorious ramp walks.
The T-Plans
Who is going after what
Disha-Aztec: wireless, mobile and telecom; embedded
device driver testing; storage, networking
RelQ: corporate application, web applications etc; BFSI,
wireless, real time and embedded systems; software games
Stag: enterprise business, which comprises e-learning,
banking, healthcare and ERP; embedded and telecom
Lionbridge: performance benchmarking services,
certification services, localization testing services, and automation testing
LogicaCMG: financial services, telecommunications
Infosys: banking, retail and healthcare, energy, telecom,
transportation
Wipro: banking, embedded system testing in telecom,
manufacturing, IT and BPO, healthcare
Applabs: telecom, pharma, e-learning, software, hardware,
financial, media, airlines
On Test Automation
Lack of clear objectives on what test automation can achieve, ad
-hoc test automation efforts and poor testability of the application under test
are the challenges facing wide adoption of test automation. Test automation can
be built for many reasons (reduce lead time, increase coverage, ensure quality);
clear objectives will help the test team to choose the right strategy.
Test automation projects need to be managed very similar to a
software development effort (Conceptualize, Design, Build, Test and Deploy). The
degree of interaction (testability) between the test tool and the application
under test plays a crucial role in building robust test scripts which will
achieve its outlined objectives. In order to build a testable application,
the test team needs to work in conjunction with the development team to build
testability as part of the product requirement.
Madhumurthy R, vice president, Technical Services, Applabs
Technologies
The Threat Perception
India is facing some competition in testing from Eastern
Europe, and China might be a rival some years from now. Where do these
geographies stand?
Eastern Europe
Some European companies do consider Eastern Europe-the old
Soviet Union, Romania, Hungary, Poland, and Czech Republic among others-for
some cost arbitrage factors.
The advantage: Strong education/ right engineers
The challenge: No critical mass of engineers
There are also sovereign risks with respect to IP and rule of
law. Also, companies from Eastern Europe have no great track record. Enterprises
often depend on a good and known individual for a project as opposed to a
company or country.
Have Indian independent validation companies lived up to customer expectations?
Ashok T, Stag Software: The fact that large companies now
have their own independent verification and validation groups, tells us that
there good business growth. If the servicing of business has been done well,
then these groups should grow. Some of the standalone-small and large-companies
have equally grown. The number of companies in independent testing has also
increased.
VK Kripanand, testing expert: Testing companies usually
are faced with the challenges of identifying the right expectations. All these
years, testing was considered an-end-stage activity. Some of the best practices
of software testing are to start early and validate all the time, when
development is happening. A heartbeat connection by the testing teams to the
requirements analysis, design and implementation teams are critical.
Many organizations test a final product against a set of
specifications. Areas like functional testing and performance testing are the
ones that are being outsourced majorly, as the infrastructure and resource needs
are quite high. The concept of requirement-driven development takes the level of
testing to a higher level and this is a concept that has to be embraced by
testing companies as well as by the companies outsourcing work to testing
companies. This, we feel, will improve customer expectations than its current
level.
Alex Garrick, GM of managed testing, LogicaCMG: The
global outsourced testing business is undergoing a revolution, moving from a
pure time and materials model to a fully managed approach. Indian independent
validation companies have come from nowhere to achieve a significant presence in
the domestic market. The question now is whether they can compete
internationally like their larger development counterparts.