ibm testing services april 2010

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NELSONHALL PERSPECTIVE NelsonHall

2010 by NelsonHall. 1 March 2010

NelsonHall Perspective

IBM Test ing Serv ic es

IBM Global Services had in 2009 revenues of $55bn and a pre-tax margin of 14.3%.

1. Background In Testing

IBM Testing Services (IBM TS) is a service line that exists in all IBM Global Services countries.It falls under IBM Global Business Services, the consulting and application services arm ofIBM.

NelsonHall estimates that IBM:

Derived approximately $550m in standalone software testing revenues for enterpriseclients (i.e. excluding internal work for IBM Software)

Employs ~8,000 career testers

Has in total 20,000 personnel with testing skills, whether career tester or occasionaltesters.

2. Recent Offerings

IBM testing Services has developed several offerings over the last two years.

Total Test Quality

Together with IBM Research and IBM Software, IBM Testing Services has developed its TotalTest Quality (TTQ) framework. TTQ focuses on the overall software development cycle.

It has several services including:

Source code analysis: uses several tools including IBM Rational Appscan and PurifyPlus, to scan the code the code and look for vulnerabilities in terms of performance,security and overall structural issues in the code. IBM argues the source codeanalysis allows to detect defects e.g. memory leakage that are very hard to findduring traditional testing. Also, this allows defects to be found earlier in the lifecyclereducing the cost of defect rectification.

Source code analysis is run as a service and does not require investment insoftware licenses

The offering can focus on specific areas such as security and performancevulnerabilities.

Defect analysis: the offering analyzes historical defect data in order to prevent newdefects being introduced and to find defects early in the software developmentlifecycle.

Service is delivered both in India for collection of client application andclassification of data and onshore, in the U.S., for the final analysis. It is basedon IBMs Defect Reduction Method

IBM differentiates between what it calls valid defects e.g. code defects andinvalid defects e.g. defects external to the code such as test data, test scriptsand test environments. The companys experience is that invalid defects can

be the most expensive cost to solve by the client


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Test Practitioner Workbench: developed with IBM Research, it provides test planningand estimation functionality. It helps in particular estimating the effort, resources andcosts for a test campaign. It provides predictive test modeling and estimates the

impact of putting more/fewer resources on the defects level at the end of the testingcampaign. The workbench functions on risk and requirement basis

Commercial offerings

IBM Testing Services has also worked on expanding the way it contracts with its clients. Theunit has developed a systematic manner to offer fixed prices to its clients. To do so, it providesan assessment of the application to test in terms of interfaces/integration tools, changes in thescope of the application e.g. build vs. enhancements, etc. Once the assessment is completed,IBM TS is able to estimate the testing effort on a man-day basis. The fixed price approach isvalid for testing services such as functional testing and performance testing.

Fixed Price Contracts

IBM Testing Services has several contracts which are based on the number of defects andoverall on software quality found in the application at the end of a testing campaign

Outcome/SLA-based Contracts

IBM is more likely to commit on defect levels as part of long-term contracts, duringwhich it has gained knowledge of the clients applications

The contract includes defined entry criteria e.g. level of defects found in theapplication before IBM proceeds to its testing effort

IBM has extended the notion of its SLA-based contract to a warranty offering. Under thisoffering, IBM commits to being paid at the end of a warranty period of several years, based onthe number of defects found in production during the warranty period.

Warranty Period

The warranty offering is available for both contract types where IBM is in charge ofthe build and run or is only involved in the independent testing service

It covers functional testing services as well as non-functional

IBM has primary responsibility for deciding how to conduct the test effort. It willconduct testing based on a risk analysis and for critical requirements

This offering is currently available for applications of a moderate complexity and isbetter fitted for application management contracts rather than for complex systemsintegration contracts

IBM Testing Services has conducted this warranty effort for a limited number ofclients. It is expecting to gain further experience and maturity for its next round ofclients in understanding when and how exactly to offer the warranty offering.

Cloud Computing

IBM TS provides three main forms of cloud computing services:

It is deploying virtualization technology over the client-owned servers aiming tomaximize the level of usage of the servers in the test environment. A virtualizedinfrastructure applies mainly to functional testing such as systems integration anduser acceptance testing. Other non-functional testing forms like performance andsecurity testing still require a physical environment

IBM is working with ISV iTKO for its Lisa product. The Lisa technology virtualizesapplications and allows to commission test environments. Examples of usage of thistechnology include simulating a mainframe without actually having to invest into such

a system. It therefore allows to simulate a mainframe backend without having toinvest into such a system. IBM Testing Services is using this technology for systemtesting


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Finally, IBM Testing Services provides mainframe testing environment capacity andrelated services under a pay-per-use offering. This offering extends a traditional wayof procuring mainframes to the testing environment level.

3. Reusable Assets

IBM Testing Services is aiming to increase the level of artifacts across clients in selected areas:

For test plans and to a lesser extent for test cases and scripts

For non-regression testing and system testing

For several packaged applications such as iflex (Oracle) and SAP

For several sector i.e banking.

However, IBM highlights that two constraints exist around the reuse of artifacts:

IP rights: artifact rights that belong to the client

Level of customization of the application to specific needs make it sometimes hard toreuse to other clients.

4. Delivery

NelsonHall estimates that IBM has ~8,000 career testers, of whom two thirds are located inIndia or other low-cost countries.

The company has standardized its delivery units, whether onshore or offshore, on standardprocesses and tools (IBM Rational). The company accommodates testing tools from othervendors, when delivery is taking place onsite, in the client premises.

5. NH Perspective

NelsonHall estimates that IBM has one the two largest testing practice in the world. The IBMtesting offering has a significantly different value proposition from most competitors

Schematically, Indian vendors are, in addition to their cost advantage, taking a domainexpertise route that builds on the large number of testers they have. They are developingtools and accelerators to make testing execution more efficient and are expanding into testdesign and optimizing the reuse of artifacts and assets. The capacity of Indian vendors toramp up resources remains unmatched

Vendors like Capgemini and Logica have a strong methodology background, still have astrong onshore presence and have very significantly expanded into offshore (in particularCapgemini). They provide a balanced alternative to an all-offshoring strategy. Among theother European vendors active in testing, Atos Origin stands out by its approach toinfrastructure-led testing

There is a third angle that is best characterized by IBM and HP. In particular their approachis based

A technology and automation approach that expands from pure execution intothe whole software development life cycle. This technology approach translatesinto code analysis and predictive modeling techniques

Synergies with IBM Software allow IBM Global Services to have a SaaSofferings of IBM Rational testing tools

IBM and, to a lesser extent, HP have expanded into offshoring and are bringingover time the accelerators and domain expertise that Indian vendors havedeveloped.

ibm testing services april 2010

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