UNIT I - Evolution of Software Economics
UNIT I - Evolution of Software Economics
MANAGEMENT
UNIT - I
Dr.A.Pathanjali Sastri
Professor, Dean Academics & QA
EVOLUTION OF SOFTWARE
ECONOMICS
Software Economics
• Most software cost models can be described five parameters : size,
process, personnel, environment and required quality.
1. The size of the end product which is typically measured in terms of the
number of source lines or the number of function points developed to
achieve the required functionality.
2. The process used to produce the end product, the ability of the process is to
avoid non value adding activities
3. The capabilities of software engineering personnel, and particularly their
experience with the computer science issues and the applications domain
issues of the project
4. The environment, which is made up of the tools and techniques available to
support efficient software development and to automate the process
5. The required quality of the product, including its features, performance,
reliability, and adaptability
Software Economics
• The following equation shows the relationship between size, process,
personnel, environment, quality parameters and between the
estimated cost
3. Modern practices:
• This phase of software development process started in year 2000 and later.
• In this phase software development is treated as production.
• Here we use integrated automation environments, off the shelf components.
Pragmatic Software Cost Estimation
• One critical problem in software cost estimation is a lack of well
documented case studies of projects that used an iterative
development approach.
• Software industry has inconsistently defined metrics or atomic units
of measure the data.
• It is hard enough to collect a homogeneous set of project data within
one organization with different processes, languages, domains, and so
on.
Software Economics
• There have been many debates among developers and vendors of
software cost estimation models and tools.
1. Which cost estimation model to use?
2. Whether to measure software size in source lines of code or function points.
3. What constitutes a good estimate?
Software Economics
• There are several popular cost estimation models
• COCOMO is also one of the most open and well documented cost estimation
models.
• SLOC worked well in applications that were predominantly custom built &
SLOC measurement was easy to automate.
• Most real world use of cost models is bottom up rather than top down.
Software Economics
• A good estimate has the following attributes:
• It is conceived and supported by the project manager, architecture team,
development team, and test team accountable for performing the work
• It is accepted by all the stake holders.
Software Economics
• The above figure illustrates the predominant practice:
• The software project manager defines the target cost of the software, and
then manipulates the parameters and sizing until the target cost can be
justified.
• The rationale for the target cost maybe to win a proposal, to solicit customer
funding, to attain internal corporate funding, or to achieve some other goal.
• In fact, it is absolutely necessary to analyze the cost risks and understand the
sensitivities and trade-offs objectively.
• It forces the software project manager to examine the risks associated with
achieving the target costs and to discuss this information with other
stakeholders.
Improving Software Economics
• Five basic parameters of the software cost model are:
1. Reducing the size or complexity of what needs to be developed.
2. Improving the development process.
3. Using more-skilled personnel and better teams (not necessarily the same
thing).
4. Using better environments (tools to automate the process).
5. Trading off or backing off on quality thresholds.
• The following table lists some of the technology developments,
process improvement efforts, and management approaches targeted
at improving the economics of software development and integration.
Improving Software Economics
Reducing Software Product Size
• The most significant way to improve affordability and return on investment (ROI)
is usually to produce a product that achieves the design goals with the minimum
amount of human-generated source material.