Developers: These botched software rollouts are costing businesses billions

Turns out we're not very good at balancing speed and quality – so says a report from the Consortium for Information and Software Security.

Freelance programmer or developer working at home and typing source code with laptop

As businesses speed-up their digitization plans, quality control is falling by the wayside, according to CISQ.

Image: comzeal, Getty Images/iStockPhoto

Software developers found themselves working very hard throughout 2020 as many businesses were forced to switch to entirely digital operations in a very short period of time.

But according to a new report from the Consortium for Information and Software Security (CISQ), this haste came at a cost: something to the tune of $2.1 trillion, to be precise, and billions in waste.

CISQ's 2020 report, The Cost of Poor Software Quality in the US, looked at the financial impact of software projects that went awry or otherwise ended up leaving companies with a larger bill by creating additional headaches for them.

According to the consortium, unsuccessful IT projects alone cost US companies $260bn in 2020, while software problems in legacy systems cost businesses $520bn and software failures in operational systems left a dent of $1.56 trillion in corporate coffers.

As a result, the total cost of poor software quality in the US amounted to approximately $2.08 trillion in 2020, CISQ said. Comparing this to the total US IT and software wage base of $1.4 trillion, the company said the figures "underscored the magnitude of the negative economic impact of poor software quality."

"The losses due to operational failure in the US alone are staggering," said Bill Curtis, executive director of CISQ. 

"It just takes one major outage or security breach to eliminate the value gained by speed to market. Disciplined software engineering matters when the potential losses are at this scale."

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While the cost of legacy IT headaches was down from $635bn two years ago, failed projects and software bugs both cost companies significantly more than they did in 2018 ($1.775bn and $1.275tn, respectively), the organisation claimed.

We can draw a few conclusions as to why poor quality software cost companies more in 2020 than in previous years. The report pointed out that speed is often a trade-off for quality and security, concluding that "we are not very good at balancing" the two.

Of course, time was a luxury that many businesses couldn't afford in 2020, with the pandemic forcing offices to shut and prompting rapid digitization. As companies brought forward their digital transformation plans – willingly or otherwise – software development projects expanded rapidly.

But there are also more intrinsic reasons why companies are footing such colossal bills for their software projects, CISQ concluded. Perhaps most importantly, there just aren't enough professionals out there will the skills that businesses need, nor the toolsets that can equip people with the skills to meet the need.

"There are simply not enough good software developers around to create all the new and modified software that users need," said the report.

"Just 2% of the worldwide population knows how to develop software, and the need is estimated to grow by 24% over the next seven years. There aren't enough educational programs available around the world to keep pace with the need."

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Business leaders' attitudes towards digital innovation may also need updating, CISQ said, particularly when it comes to software. "Software quality lags behind other objectives in most organizations," said the report.

"That lack of primary attention to quality comes at a steep cost, which is revealed in this report. While organizations can monetize the business value of speed, they rarely measure the offsetting cost of poor quality."

The report concluded that successful approaches to improve software quality needed to address individuals, teams, and organizational leadership.

"While software is eating the world more voraciously than ever before, the cost of poor software quality is rising, and mostly still hidden," said Herb Krasner, author of the report and CISQ advisory board member. 

"Organizations spend way too much unquantified time finding and fixing defects in new software and dealing with legacy software that cannot be easily evolved and modified. We hope this report inspires organizations to embark on the journey of making the necessary changes."

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