How We Calculate ROI from Test Automation
Understanding the return on investment (ROI) is critical when evaluating automation for enterprise applications. Our calculator is designed to provide a transparent, data-driven estimate of your potential cost savings.
Calculation Methodology
We evaluate ROI by comparing the total cost of manual testing versus the cost after automation across various application types such as D365, SAP, Oracle, Salesforce, and more.
Here's how we calculate it:
1. Manual Testing Cost
This represents the total cost your organization incurs when testing is done entirely without automation.
Formula:
Manual Cost = Number of Apps × Hours per App × Cost per Hour × Number of Test Cycles
2. Automated Testing Cost
This reflects the cost of testing after automation is introduced, based on your automation coverage percentage (i.e., how much of the testing effort is replaced by automation).
Formula:
Automated Cost = Manual Cost × (1 - Automation Coverage %)
3. Savings
This is the difference between your manual and automated costs.
Formula:
Savings = Manual Cost - Automated Cost
4. ROI (%)
ROI quantifies the benefit of automation relative to your existing manual cost.
Formula:
ROI = (Savings / Manual Cost) × 100
Application-Level Breakdown
We don’t stop at the total ROI. The calculator also provides a detailed breakdown for each application type:
- Manual vs Automated cost per app type
- App-wise savings
- App-specific ROI %
This helps you see which applications contribute most to your automation ROI and where the biggest opportunities lie.
Visual Reporting
The calculator includes:
- Comparison bar charts showing manual vs automated testing costs
- Stacked charts by application type to visualize where automation delivers the most value
Example
If you test 25 D365 applications with 100 manual hours per app, at $50/hour and 12 test cycles per year, and automate 80% of the effort:
- Manual Cost = $1,500,000
- Automated Cost = $300,000
- Savings = $1,200,000
- ROI = 80%
Why This Matters
By quantifying your savings potential, this calculator helps you:
- Justify investments in test automation
- Prioritize which applications to automate first
- Communicate ROI to leadership in clear, financial terms
