The news this week featured the ITC Infotech's acquisition of a QA Consulting firm Pyxis. What this indicates is two things:

1. The mergers and acquistions wave hasn't died out yet. Started in Dec 2006 with the Kanbay acquisition by Capgemini and the trend continues despite the financial crisis.

2. Indian companies (mid-tier) now understand that they have to change in character to look and be more global in terms of their workforce. This will give them entry and acceptance into  markets such as the US and Europe.

3. Most distressingly, it hints at the Software Testing market becoming commoditized. It's no longer considered neccessary to spawn a Software Testing practice organically. You can go to the market and just  buy one up. Meaning there are no substantial differentiators in an already tight market.

That's the reason it's even more important to have a product in testing (even open source) and services around that and others. Just my 0.02$.

        

The most quoted statistic in the Software Testing Industry - and I mean consulting firms offering outsourced software testing as a service offering - is the US Department of Commerce NIST study from 2002. This study claimed that inadequate software testing costed the US some $60 billion in direct and indirect costs i.e. there were nearly $38 billion of preventable losses provided there were adequate investments in software testing.

The year 2000 is when the outsourced software testing industry really took off in India with many pureplays recognizing the market potential and hiving off new business units that focused almost entirely on this market "white space". Today one might claim, this industry is nearly 8 years old, not quite a toddler and certainly more refined that it started off.

2002 was when I got the chance to build such a software testing business unit from scratch. The very concept of stepping out of the shadows and being perceived as "development support staff" to being a locus of revenue generation was all the motivation I needed. Spending over 6 years creating, running and building a professional services practice in the Software Testing space gave me a few insights in to the current state and future of this industry, which is what I hope to talk about in this blog over the next few posts.

The industry is now fragmented into four broad kinds of companies, some which have added software testing services to complete their services bouquets and others that depend only on this as a primary source of revenue.

Here's the Who's Who:

- The Big Six: Consists of the pureplay Indian vendors - monikered as the SWITCH (Satyam, Wipro, Infosys, TCS, Cognizant and HCL). Some of these companies have bigger practices that are consolidated across domains, while others have a smaller, me-too practices.

The serious three are Wipro - who claim to be the world's largest independent testing practice, Cognizant and Infosys. Between the three, they easily clock around ~$900m to over a billion dollars in Testing Services. Typical size ranges between 2000 to 9000 dedicated employees.

- The Mid-Tier Domain-led Pureplays: This segment includes the other smaller pureplay vendors with sub-3000 headcounts.  Here we find Polaris, Birlasoft etc. These companies are usually focused on a couple of domains e.g. Financial Services, Media, Telecom etc.

- Dedicated Pureplays: There are certain companies that have chosen to have testing services as their primary offering. Why this is particularly audacious, is because this is an area where revenues weren't guaranteed to  be perennial and talent was at a premium. The crowd here is mostly AppLabs, Maverick, AztecSoft etc.

- The Globals: A lot of global consulting firms realized the value in consolidation. This includes Accenture, Capgemini, HP (with the EDS piece) and IBM. Some of these globals don't have the ability to weave together all their capabilities in disparate geographies under one roof and market that as a testing service. Sooner or later, this will start to happen.

You will notice that my list seems to be India-centric and of course, I will freely admit that this is the competitive spectrum that I have addressed more than others. There are geography leaders e.g. SQS in Germany and the UK, Orasi in the US, Polteq in the NL which satisfies a niche in Assessment Consulting. This I promise to cover in a more structured format.

Once we have understood the market, I will attempt to address the issue of competitive differentiation.

        

Every blog should have a purpose and the audience gravitates towards the content when they identify with the purpose themselves. This post is my attempt to outline the raison d'être of my blog.

A lot of you may have been following my earlier blog at testingreflections.com here : http://www.testingreflections.com/blog/76

That one was a technology focused Performance Testing blog. This time, I intend to paint on a larger canvas.

For those who came in late, a little something about myself:

I have spent over 13 years in the software testing industry, working for top consulting firms in India, the US and Europe. This has seen me work in different geographies like the US, the Netherlands, France, Germany, the UK, Japan and India.

Specifically, over the last 5 and half years, I had the opportunity to build a testing service practice at one of the largest European consultancy firms. A practice that was focused on offering testing services to the financial industry - namely, large banks, insurance companies, capital markets firms etc.

It's been a roller coaster ride, with my work spanning everything from hiring good technologists, creating the business case for top management, advising and consulting with top client CIOs  to managing projects and selling services. Of course in the inital couple of years, I pretty much did everything from waiting on tables to cooking the food (metaphorically speaking!).

Some of the most interesting work in the last couple of years had had me running a Services Innovations team focused on creating testing services for the financial industry. It has had quite an impact to our bottom lines, since the Test Assessment service offering that I designed had opened doors to some $24 million worth of new business for the company.

This blog is to share the experience of creating a testing services practice, setting up Testing Centres of Excellence (TCoE) / Test Factories that leverage talents from multiple geographies, the hows and whys of creating business cases from a services viewpoint and some crystal ball gazing on my part.

I'm no Alvin Toffler, but I think the Software Testing profession is in flux influenced by technology changes, consolidations in the tool vendor space, the mushrooming of open source techniques, process models, tools and of course, newer business /regulatory pressures. It will be my endeavour to outline how this will influence our world.

        

A couple of months ago, a colleague of mine and I hijacked a regular sales conference call.  So one moment we're talking about open sales leads and client situations and the next moment, the conversation veered around to how we needed to revamp our Test Maturity Assessment offering.

That's when we started to argue whether or not our existing service offering (built around Test Process Improvement - TPI®) should be rebranded as the Quality Blueprint. This is no innocuous discussion, because in effect, we were debating whether it was Software Testing or Quality Improvement we offered our customers.

Now I should possibly go fully disclosure and admit that I'm from the engineering side of the house, having spent over 13 years in this profession. Sure, I engage with clients all the time and sell them services I genuinely believe are going to improve the overall reliability of their business systems. But I can't see myself as someone only from the sales side of the house. My colleague, on the other hand, was more of a marketing maven. Arguably, he was more wedded to how we'd be perceived by the market. Two individuals, two perspectives.

I don't see software testing as anything but another engineering discipline. Quality improvement and assurance is more to do with the classical "process + people" doctrine. Software testing does not improve quality, it is merely a lag indicator of deeper issues within development and deployment. I see it merely as a harbinger of tidings, good or bad. One viewpoint is around how Quality Control tries to achieve the same thing as Software Testing. History tells us that QC is a means of oversight and stories about of how King John of England employed William Wrotham to surpervise workmanship during the contruction of the English fleet. That's oversight, not engineering. What we do in Software Testing has to do with the design of tests, which, with the advent of complex technologies has become an engineering discipline in it's own right.

I'd assumed that pretty much a consensus of sorts had developed around this subject. After all, what one should call oneself pretty important. Professionals need to be able to define their profession and explain in simple layman's terms to their 6-year-olds exactly what it is that daddy does at work.

I know what I am.  I'm a Test Engineer.