Calculating Return on Investment for Software Product Lines PAUL
CLEMENTS
Product
line engineering has become a widely used methodology for the efficient
development of complete portfolios of software products.1
The core idea of the approach is to regard the development of a set of
products as a single, coherent development task. This approach has been
shown to produce orders of magnitude economic improvements over one-at-a-time
software system development.
The
SEI is helping organizations understand the benefits of product line engineering.
Often, the first thing a manager in an organization considering product
lines wants to know is the return on investment (ROI) for changing the
company’s development strategy. Until now, however, most of the economic
arguments supporting the switch to product lines have been based on data
derived from individual case studies,2, 3
convincing arguments based on rationality and simplistic cost curves.4 Existing models of product
line development costs for the context of reuse can be applied only in
a restricted way, as product line development makes some fundamental assumptions
that are not reflected in these models.
A
Product Line Economic Model
Recently,
a small project team at the SEI has begun to work on the problem of calculating
the cost benefit of the product line approach. The model is based on four
cost functions:
Corg() is a function that, given the relevant parameters,
returns the cost to an organization of adopting the product line approach
for its products. Such costs can include reorganization, process improvement,
training, and whatever other organizational remedies are necessary.
Ccab() is a function that, given the relevant parameters,
returns the cost to develop a core asset base suited to satisfy a particular
scope. Ccab differs from Cunique in that it must take into account the
cost of performing a commonality/variability analysis, the cost of designing
and then evaluating a generic (as opposed to a single-system) software
architecture, and the cost of developing the software so designed. Ccab
can be invoked to tell us the cost of developing a core asset base where
none currently exists, or it can be invoked to tell us the cost of deriving
a desired core asset base from one or more already in place.
Cunique()
is a function that, given the relevant parameters, returns the cost
to develop unique software that is not based on a product line platform.
The result might be a complete product or it might be the unique part
of a product whose remainder is built atop a product line core asset
base.
Creuse()
is a function that, given the relevant parameters, returns the development
cost to reuse core assets in a core asset base. Creuse includes the
cost of locating and checking out a core asset, tailoring it for use
in the intended application, and performing the extra integration tests
associated with reusing core assets.
These
cost functions are not mathematically rigorous, but they do let
us break down the costs into more manageable analytical chunks.
They don’t actually “return” values, but let us perform thought
experiments, use legacy data, or invoke more conventional cost models
on smaller pieces of the problem. Hence, the cost of developing
a software product line from scratch can be expressed as
where
n is the number of products in the product line. Other situations
can be similarly formulated, and the cost of building and managing
the evolution of a product line can be compared to the cost of building
the same systems from scratch. ROI is simply cost savings of doing
things the new way divided by the cost of investment – which in
this case is usually Ccab + Corg.
Third
Software Product Line Conference (SPLC 2004)
Boston, MA
August 30-September 2
Software
product lines have emerged as an important development paradigm,
with an active community of practitioners. The Third Software Product
Line Conference (SPLC 2004), to be held August 30-September 2 in
Boston, is a leading forum for researchers and practitioners working
in the field. The conference will feature technical papers, topical
panels, a rich selection of tutorials and workshops, demonstrations,
birds-of-a-feather meetings, and new inductions into the Software
Product Line Hall of Fame.
We
hope this simple model will prove useful in helping software development
managers or corporate decision-makers understand the cost benefits they
might expect when switching to the product line approach. Our team is
working to expand the model to include the non-cost benefits of product
line engineering, such as higher quality and decreased time to market.
We are also seeking real-world opportunities to put the model to use.
Knauber,
P.; Bermejo, J.; Böckle, G.; Leite, J.; van der Linden, F.; Northrop,
L.; Stark, M.; & Weiss, D. “Quantifying Product Line Benefit,”
Proceedings of the Fourth International Workshop on Product Family
Engineering, Bilbao, Spain, October 3-4, 2001. Heidelberg, Germany:
Springer-Verlag, 2001.
