German-headquartered SQS (Software Quality Systems) claims to be the world’s largest "pure play" supplier of independent software testing and quality management services, with a headcount of just under 2,000 staff worldwide and customers including BP, Deutsche Post and Reuters.
It also recently (January) announced a £5m deal with Specsavers to provide on- and off-shore managed testing services, for example. For its just released full 2010 financial year results the 28-year old firm saw turnover increase 21% to €162.9m and with (after all the usual complex accounting) pre-tax profit up a very healthy 22.5% too, to €52.1m. CBR spoke this week with one of its senior execs to find out more.
What is unique about SQS, would you say, David – what is your company’s USP?
We are the only publicly quoted company that only does this – this is our sole focus. You have lots of big systems integrators and independents in this market – the last three or four years has seen a big legitimisation of it, as companies like IBM, TCS, Wipro, Cognizant, Logica, many others, have come in.
But the choice in the market is between these very big companies and smaller, often very regional, players. So we really are distinct – testing and software quality assurance is all we do.
OK, what about some sense of the size of the market you are operating in, then?
It’s been said that 20% of all IT is spent on testing in some aspect, if you include the whole lifecycle. IDC has put the size of the space we play in specifically at about €13bn globally and around €6bn in Europe. All in all, you’re looking at tremendous opportunity across that lifecycle, from business inception of a system to go-live to maintenance and new release management.
Are you saying that testing is somehow ‘new’? Haven’t we always done it?
I think there’s been a sense of it becoming a separate activity, less completely tied to pure development or the standard maintenance model, which is why I think you’ve seen a lot of the Indian-based consultancies come in. But there are many options now – I think there are at least 30 places you can now get this done by a third party in the UK alone.
Let’s get back to you and the company for a minute. So what is it you do for SQS?
My main role and responsibility here is managing our businesses in the UK, Ireland, Nordics, India and South Africa [his formal job title is ‘Executive Main Board Director’] and I am a Plc board member.
Can you walk us through a couple of engagements so our readers can get a picture of what it is you tend to supply your customers, then?
Of course. We have what we think is a groundbreaking two year managed testing service with Egg, which means we’re now responsible for all that online bank’s regression and performance testing needs. Like a lot of our contracts, that deal is measured on what we call ‘Test Points’ – a metric of software quality, so Egg ‘buys’ a number of TPs on a rolling monthly basis so the client only pays for completed testing, not just consultant man hours. That means that if we don’t meet the agreed target, we don’t get paid, which is a great incentive.
Another great one is Siemens, where we are working with a software product subsidiary of the company to be its bug-fix and testing arm for each new release of the system, something that means literally tens of thousands of cases. Doing that automatically saves the client huge overhead. The key idea term here is automation, automation to up frequency but maintain integrity, if you like.
So maybe you can sum up your message about testing and QA to the CBR reader?
Quality has value – pure and simple. Ask most CIOs what they want and they’ll say they want happier users, and the easiest and best way to deliver that happier user base is to put software that works and meets their expectations in front of them; that way they are more productive, and also will want more software from you, too.
CIOs also want to be as industrial as they can – to work from a platform that delivers higher throughput at no harm to quality. Put all that together and I think they’ll agree with us that testing and high quality software go together.
