In this article, we will introduce you to how the Business Analysis (BA) discipline can contribute to strategic, project and organizational success. In other words, how does Business Analysis add value to the organization? In addressing and answering this question, we will cover the following topics: growth in interest in the business analyst, The International Institute for Business Analysis (IIBA®), the role of the Business Analyst, required skills of a Business Analyst, and how the Business Analyst works with the Project Manager (PM) and the business community. The following quote serves as a helpful launching point:
“An order shaper is one who knows and has assimilated the customers’ pain. They need to participate in all the strategic planning and meetings, but the challenge is earning a seat at the table. While being a super order taker can achieve this over time, you can’t simply be a smiling face because you’ll get in the position of overpromising. Because the Business Requirements Manager knows how the company makes money, they can write business cases that demonstrate the impact of a project’s ability to help the company make money.” – Dave Ficken, Vice President, Corporate Information systems, McDonald’s Corporation
We are convinced that Business Analysts, when properly placed and utilized in the organization along the lines of the “order shaper” described above, can be an asset to their respective stakeholders by keeping concerns for the market, profit, and the enterprise at the forefront of their activities.
The Problem
Why in the world would any organization need a new department, a new skill set, and a new profession to deliver value to the organization? Why can’t organizations just rely on the existing marketing, engineering, finance and accounting people to solve their business problems? After all, these organizations hire the best people from the best schools in the world. These top-flight professionals know all about our business and how to make our businesses successful. In addition, they created a Project Management Office (PMO) and hired some very intelligent project managers. And so they may reasonably ask questions such as the following: “Why do we need another professional?”, “Is Business Analysis just another fad?” and “Is BA just another name for a ‘System Analyst’?” So what exactly is a Business Analyst, and how does he or she add value to the company?
The Solution
At IIL, we believe that the BA field is growing and will continue to expand because of the problems and challenges in delivering information technology (IT)-related projects. Based on findings in The Standish Group’s CHAOS Report, most projects are challenged (50%) and an additional 25% of all projects are considered to have failed.1
That statistic means that organizations will obtain only a 25% success rate for the projects they initiate. Can your company survive with a 25% project success rate? Can BA add to the bottom line of an organization and add value? Yes; and we demonstrate what this value can be through the information presented in this article. But first, let’s start with the official definition of business analysis.
As defined by the International Institute of Business Analysts® (IIBA®), “Business analysis is the set of tasks and techniques used to work as a liaison among stakeholders in order to understand the structure, policies and operations of an organization, and to recommend solutions that enable the organization to achieve its goals.” In short, the Business Analyst helps the organization identify issues (problems, opportunities, and needs) and implement the changes that solve the business issue.
What is the IIBA®?
The IIBA®, which was established on March 2, 2004, in Toronto, Canada, formed as a not-for-profit professional association to provide a body of knowledge for BA and to promote the profession. The organization has experienced tremendous growth, and the data point to an exponential growth for the organization and the BA field. The IIBA® is adding significantly to the field of Business Analysis by developing, maintaining, and distributing the Business Analysis Body of Knowledge (BABOK® ). The BABOK® provides a conceptual framework of best practices for Business Analysis. As we address this topic, we’ll see how this Body of Knowledge impacts all aspects of Business Analysis.
BA and the Business Community
There are four main reasons why interest in Business Analysis has grown: (1) unsatisfactory project results, (2) outsourcing, (3) regulatory demands (e.g., Sarbanes-Oxley [SOX] in the United States), and (4) process optimization. The Business Analyst needs the business community — and the business community needs the Business Analyst. Through solution requirements traceability, for example, the Business Analyst acts to manage the client’s expectations for the resulting solution. As an added resource to the project team, the Business Analyst helps validate requirements during acceptance testing and ultimately helps meet project outcomes and client expectations.
The Role of the Business Analyst
The Business Analyst’s main role in an organization and on a team is to manage the solution scope of the project deliverable. This solution scope must be defined effectively as it informs the overall project scope. With that objective in mind, the Business Analyst takes the lead in handling all aspect of the solution scope. The Business Analyst will also act as a facilitator, communicator and problem solver in managing the solution scope. Finally, he or she will elicit requirements, analyze requirements, and plan all the Business Analysis activities by creating a Business Analysis Plan while participating in the monitoring and controlling of the solution scope for the project.
The Required Skills of a Business Analyst
A Business Analyst is accountable for defining and helping ensure that the right solution is delivered by using his or her skills as a vehicle for overall project success to be realized through people, technology and processes. There are a number of skills that will contribute to the success of the Business Analyst. Among these skills, the most important for Business Analysts are communication skills, which include oral, written and listening skills. Another skill that is very important for the Business Analyst is that of facilitation of the needs of stakeholders in all phases of the project life cycle.
At IIL, we have identified nine skill sets that we think are important for a Business Analyst. These skills are:
- Verbal and Written Communication
- Analytical and Systems thinking
- Technology and Business Knowledge
- Modeling (process, data, system)
- Relationship Management
- Negotiation
- Evaluation and Decision Analysis
- Planning and Management
- Elicitation and Facilitation
A Business Analyst does not have to master all the skills above; however, he or she should master a few of them and have a good working knowledge of all of the skills listed. The Business Analyst can assist the Project Manager in protecting the project scope by applying the above skills in managing the solution scope from the requirements phase to the implementation phase of the project.
How the Business Analyst Helps the Project Even before It Has Started
Root cause analysis is the first and most crucial step to ensure the right issue has been identified that the project will be designed to “solve.” This step ensures that any resulting projects are not reacting to stakeholder-identified symptoms. If the real issues are not identified, the business will continue to feel the effect of the problem despite spending time and money on a project that only relieved the symptoms.
One way to identify the root cause of a problem is to use the Business Analyst’s foundational tool – questioning techniques. A good Business Analyst knows how to plan for and construct effective, focused questions. By asking probing questions, the Business Analyst will get beyond what the business area in question thinks it wants to get to what it in fact needs. There are many root cause techniques, and this article will address two – The Five Whys and Fishbone diagramming.
The Five Whys
This approach uses a series of questions (anywhere from three to seven) that build on one another to “excavate” from the perceived issue to the actual problem. By way of example, let’s examine the following:
The business states that that its customers are complaining about the service levels, and it believes it needs to automate.The following series of questions illustrates the questioning process that a Business Analyst might take in this situation.
- Business Analyst: “Why is the service level a problem?”
Business/Stakeholder: “It’s a problem because our clients have to wait too long to get a service agent.” - Business Analyst: “Why do they have to wait so long?”
Business/Stakeholder: “From our reports, we see that there is a surge of calls at the end of each month.”
- Business Analyst: “Why is there a surge of calls at the end of the month?”
Business/Stakeholder: “The end of the month is when we pay out claims.”
- Business Analyst: “Why are claims paid out at the end of the month?”
Business/Stakeholder: “Because we have always done it that way.”
- Business Analyst: “Do we have to do it that way?”
Business/Stakeholder: “No, probably not.”
So in this case, the Business Analyst has, through questioning techniques, identified that the end of the month timeline is arbitrary and could be changed without automation, and has avoided a potentially costly automation project.
Another root cause analysis tool is a Fishbone diagram, which is also known as an Ishikawa or cause-and-effect diagram and is shown in Figure 1.
Figure 1: Cause-and-Effect Diagram2
This brainstorming tool can be used by the Business Analyst to keep the audience focused on the potential causes of problems rather than on the solution.
To use the diagram as an exercise for brainstorming, the issue is written at the top of a flip chart. The line, or spine of the fish, is drawn and attaches to the resulting problem/effect. Each of the categories attach to the spine of the drawing by using a line that represents the primary cause. These categories of potential causes of the problem usually represent people, processes, policies, materials, equipment, management, and environment.
The Business Analyst facilitates the brainstorming session to determine both the primary, secondary, and tertiary causes. The secondary and tertiary causes link to the primary cause by using a line. Once the session is complete, the Business Analyst analyzes the information that was surfaced through the exercise and collects data to substantiate the root cause findings, thus quantifying the problem.
With all of this BA activity occurring — hopefully before a project is even considered — a solution and solution scope can be defined. Once the root cause and a subsequent solution have been identified, the Business Analyst then writes a clear, concise problem statement; a business objective statement; and a solution scope statement, all of which will be used to determine the project scope. These statements serve as a beacon for the resulting project team and assist in managing scope.
How the Business Analyst Works with Project Manager
Now that the project scope has been defined, a Business Analyst should work with the PM as the requirements team lead. Each role is unique. While the PM is managing project time, resources, budget, and project scope, the Business Analyst is further refining the requirements and managing the solution scope. Most PMs are not aware that someone like a Business Analyst can take the leadership in handling the information needed to generate requirements, manage traceability, and keep the solution scope in check.
Business Analysis adds value by providing planning inputs to the PM, especially time estimates required to gather information, analyze information, review information, document information, and coordinate with team and client stakeholders. Business Analysts provide the PM with requirements reviews and inspection schedules that will use the time allocated from the business and the project team. The requirements reviews are critical to capturing errors in the requirements documentation.
When requirements errors and omissions are caught early (by the business and project team), both time and money are saved. It is well documented that when a requirements error is left unchecked, the cost to fix the oversight is multiplied by up to 20% in the design and development phase, by 40–60% in the testing phase, and beyond 100% in the implementation phase. Therefore, the Business Analyst becomes the catalyst and the primary driver behind the requirement reviews, thus saving the PM time and headaches further down the road.
Summary and Conclusions
According to a study conducted by the Corporate Executive Board, Application Executive Council, “Improving business analyst proficiency can improve application performance by as much as 30%.” According to the same study, a Business Analyst who is proficient in understanding business process complexity as well as economic and revenue drivers — and who can recognize the implications of changes in business strategy and accurately measure the contribution of IT projects to business value — can contribute to “extremely high [application] proficiency.”
When including the deliverable of providing cost benefits, a skilled Business Analyst enhances the link between the user and the IT, which can result in reduced miscommunication, thus reducing the level of chaos.
Less project chaos lowers overtime, improves team morale, and enhances the team’s chance of delivering a solution on time. Most of all, the Business Analyst will contribute to higher customer satisfaction by adding value. Gone are the days when a project was considered successful when it satisfied the triple constraints (of being on time, within budget, and of the right scope); in today’s environment, a project may get a failing score on one or more of the triple constraints and still be successful. Success has to include value-added elements and whether the expectations of the executive stakeholder(s) are being met.
An organization can add value to its projects, improve project success, and thereby improve the organization’s bottom line by adding a Business Analyst to its project team.
References:
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The Standish Group, 2007 CHAOS Report.
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From Figure 9-10 of the IIBA® BABOK, p. 203.