Software defect costs

In my persuit of software engineering data, I’ve recently been poring over a 2002 report to the US Government on the annual costs of software¬† defects. The report is entitled “The Economic Impacts of Inadequate Infrastructure for Software Testing“. Ultimately, it estimates that software defects cost the US economy $59.5 billion every year.

Modelling such economic impacts is an incredibly complex task, and I haven’t read most of the report’s 309 pages (because much of it isn’t immediately relevant to my work). However, since trying to use some of the report’s data for my own purposes, certain things have been bothering me.

For instance, the following (taken from the report):


This table summarises the consequences to users of software defects (where “users” are companies in the automotive and aerospace industries).

Strictly speaking, it shouldn’t even be a table. The right-most column serves no purpose, and what remains is a collection of disparate pieces of information. There is nothing inherently “tabular” about the data being presented. Admittedly, for someone skimming through the document, the data is much easier to spot in a table form than as plain text.

The last number piqued my curiosity, and my frustration (since I need to use it). What kind of person considers a $4 million loss to be the result of a “minor” error? This seems to be well in excess of the cost of a “major” error. If we multiply it by the average number of minor errors for each company (70.2) we arrive at the ludicrous figure of $282 million. For minor errors. Per company. Each year.

If the $4 million figure is really the total cost of minor errors – which would place it more within the bounds of plausibility – why does it say “Costs per bug”?

The report includes a similar table for the financial services sector. There, the cost per minor error is apparently a mere $3,292.90, less than a thousandth of that in the automotive and aerospace industries. However, there the cost of major errors is similarly much lower, and still fails to exceed the cost of minor errors. Apparently.

What’s more, the report seems to be very casual about its use of the words “bug” and “error”, and uses them interchangeably (as you can see in the above table). The term “bug” is roughly equivalent to “defect”. “Error” has a somewhat different meaning in software testing. Different definitions for these terms abound, but the report provides no definitions of its own (that I’ve found, anyway). This may be a moot point, because none of these terms accurately describe what the numbers are actually referring to – “failures”.

A failure is the event in which the software does something it isn’t supposed to do, or fails to do something it should. A defect, bug or fault is generally the underlying imperfection in the software that causes a failure. The distinction is important, because a single defect can result in an ongoing sequence of failures. The cost of a defect is the cost of all failures attributable to that defect, put together, as well as any costs associated with finding and removing it.

The casual use of the terms “bug” and “error” extends to the survey instrument – the questionnaire through which data was obtained – and this is where the real trouble lies. Here, potential respondants are asked about bugs, errors and failures with no suggestion of any difference in the meanings of those terms. It is not clear what interpretation a respondant would have taken. Failures are more visible than defects, but if you use a piece of buggy software for long enough, you will take note of the defects so that you can avoid them.

I’m not sure what effect this has on the final estimate given by the report, and I’m not suggesting that the $59.5 billion figure is substantially inaccurate. However, it worries me that such a comprehensive report on software testing is not more rigorous in its terminology and more careful in its data collection.