The Consortium for Information & Software Quality (CISQ) recently released a report about the cost of poor quality software (CPSQ) in the US in 2020. Reading between the lines, we can see how the COVID-19 crisis contributed to making this problem even worse.
This past January, CISQ released The Cost of Poor Quality Software in the US: A 2020 Report and presented a webinar covering the key findings. Both provided valuable information about how the spread of poor software quality has had serious economic consequences in the United States.
Of course, 2020 was not a typical year. Because of the coronavirus pandemic, both the global economy and the IT industry faced extraordinary challenges, resulting in a slightly different focus this year than in CISQ’s 2018 report.
Herb Krasner, the report’s author and an Advisory Board Member of CISQ, explains how the pandemic shaped the development of this year’s report: “This report was developed during especially turbulent times with the world battling a global pandemic. Yet, software continues to grow, proliferate, and enhance our digitally enabled lives. … The result is a balancing act trying to deliver value at high speed without sacrificing quality.”
Even before the pandemic, the role of the IT industry was expanding globally. Traditional industries began offering a greater share of their products and services online over recent years, prompting the development of new software platforms and tools.
After the pandemic began, the growth of new software and online services began to accelerate:
- North American companies now interact digitally with customers 65% of the time, compared to 41% before COVID-19, and these statistics are similar across the globe.
- Many companies were able to make the switch to remote work more than 40 times more quickly than they had even thought was possible, according to an October 2020 survey from McKinsey & Company.
- Industries that kept their heads above water during the pandemic were those either operating digitally already or those positioned to adapt. Online retail, logistics, and certain kinds of manufacturing fared well during this period.
This sharp increase in digitalization, especially over such a short period of time, increased demand worldwide for software-based solutions to an even greater degree. As Herb notes, “This crisis might well spark further creativity and innovation. Remote work, online education, and social distancing create demand for products and services delivered by the IT industry.”
And these changes are almost certainly here to stay.
Increased digitalization means the existence of much more data online than in the past. The amount of digital data now stored is 96 zettabytes (or 96 trillion gigabytes), a tremendous increase from the 16 zettabytes of digital data stored in 2016.
Also, approximately 1.655 trillion lines of code currently exist worldwide, 513 billion of which are in the U.S. And each year, developers create around 100 billion new lines of code, a growth rate of approximately 7%. As data proliferates and software systems become more complex, the number of weaknesses and vulnerabilities unfortunately also grows.
Operational Software Failures
One consequence of this rapid software growth is an increase in operational software failures, usually resulting from poor software quality. Of the total $2.08 trillion cost of poor software quality for 2020, operational software failures make up the largest category, estimated at $1.56 trillion.
Within this category, three specific trends magnify the impact of software flaws and cause failure costs to increase:
- Digital Transformation: As already mentioned, many organizations have been forced to digitalize to survive, whether they were ready for this step or not. Herb explains that, “In fact, a lot of companies are speeding up their digital transformation efforts because they needed to, because their entire workforce went remote.” As software increasingly controls more aspects of a company’s business, software flaws have a greater potential to create problems across the value chain.
- Systems of Systems: As software is developed, applications rely on platforms and all the resources with which they connect. The complexity and interconnectedness of these systems increase the impact of weaknesses and vulnerabilities and make software flaws harder to find in case of operational failures.
- Increased Competition: As organizations compete online under these new conditions, they often end up focusing more on speed than on security and overall quality, putting themselves at risk. Without a commitment to budgeting time and resources to find and fix flaws before software speeds to market, overall poor software quality results.
One of the largest outcomes of these trends is an enormous growth in cybercrime. As Herb says, “Cybercrimes enabled by exploitable weaknesses and vulnerabilities in software are the largest growth area by far in the last 2 years. It is also the area where rapid growth is most likely.”
This problem has skyrocketed during the pandemic. Ransomware attacks have threatened hospitals, schools, and the manufacturing industry. Cybercriminals have targeted coronavirus researchers’ information and the temperature-controlled supply chain so important in the distribution of the coronavirus vaccine. In addition, small businesses are the target of nearly half of all cyberattacks, and identity theft has grown.
The cost impact of these cyberattacks is staggering. Business insurance provider Embroker predicts that by 2021, the global economy is expected to see a $6 trillion cost due to cyberattacks, double the $3 trillion figure in 2015, and calls this increase “the greatest transfer of economic wealth in history.” Ransomware alone will account for approximately $20 billion of this cost.
Recommendations and Solutions
With the already alarming consequences of the cost of poor software quality magnified by the pandemic, how can we protect ourselves?
A focus on quality is key. Herb observes that, “Software quality lags behind other objectives in most organizations. That lack of primary attention to quality comes at a steep cost. … While organizations can monetize the business value of speed, they rarely measure the offsetting cost of poor quality.”
In the webinar, he offered some broad recommendations for addressing the enormous cost of poor software quality:
- Prevent bugs, flaws, weaknesses, vulnerabilities from being created and fielded
- Find and fix bugs early
- Measure quality
- Adopt high quality development practices
- Analyze potentially flawed components (such as open-source software)
Following these recommendations will help organizations have a fighting chance of surviving the pandemic intact and avoiding catastrophic software failures. Not only that, but a focus on software quality will also help protect a company’s bottom line.
Interested in learning more about how the costs of poor software quality might be impacting your organization? Try OverOps’ cost of an error calculator to find out how much software quality problems are costing you.