The State of Business Analysis Practices in Organizations

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Authors: Lori Lindbergh, PhD & Kathleen B. Hass, PMP

Abstract

To remain competitive, it is more important than ever for an organization’s leadership team to use business analysis (BA) practices to execute strategies through innovative solutions. Over the years, business analysis has been rapidly developing as a profession and as a core business practice in many organizations; however, all too often business analysis is still in its foundational stages. While there are many studies on the role of business analysts, there is a gap in knowledge about the maturity of business analysis practices in organizations.

This study used a proprietary Business Analysis Practice Maturity Model to examine the state of business practices in organizations. The good news is the findings validated that BA practices are fast emerging in organizations. This is happening as businesses get serious about investing in professional business analysis. Although BA practices are still mostly tactical, organizations are beginning to invest in more strategic business analysis practices. Furthermore, those organizations that are investing in more mature BA practices are experiencing fewer project challenges and are also delivering greater business benefits.

Introduction

Businesses are operating in a complex global economy that is in chaos; the earning power of many countries around the world has contracted and may never be the same again. Findings of a recent study, consisting of interviews with more than 1500 CEOs, indicate that the presence of unrelenting complexity is the number one challenge that companies face in the 21st century (IBM, 2010). These CEOs believe they are not equipped to manage the complexities they face. In addition, there is a realization that we must learn to capitalize on complexity to unleash the creativity and innovation that are the hallmark of successful organizations.

So what does this really mean for 21st century businesses? Will your organization be able to adapt to an ever more complex business environment faster than your competitors? Adaptability and agility are essential – success will require a strategy and approach to managing change and complexity through innovation that hits the mark, is executed flawlessly with expert skills, and delivers real business value. We can no longer depend on traditional management methods that were developed under very different economic conditions. We need to embrace new approaches to business management.

Importance of Business Analysis Practices

Organizations that are first to acquire and master business analysis and elevate enterprise business analysts to a critical leadership role will more effectively react to and pre-empt changes in the marketplace, which is required to flow value through the business to their customers to achieve competitive advantage. In today’s global economy, the conventional wisdom is: Innovation is the key to survival – “Innovate or evaporate!” (I-Vibe Global, 2010). It is through projects that companies innovate to create value for their customers and wealth for their organizations – translating ideas into profit.

The effectiveness of an organization’s ability to innovate through programs and supporting projects depends on its ability to define and execute strategy by:

  • Understanding their market and the competitive environment,
  • Establishing a future vision and setting strategic goals,
  • Converting strategies to valuable innovation projects, and then
  • Executing flawlessly to be first to market.

The Burden of Business Analysis

In the 21st century it is essential for an organization’s leadership team to establish a future vision and set strategic goals to innovate and remain competitive. However, the leadership team cannot execute strategy alone. It is through a robust portfolio of projects that strategies are converted to valuable programs and projects. What keeps organizations from successfully managing their project portfolio? “Companies often lack the necessary management information and the energy required to address the burden of analysis” (Mais, 2006, p. 3).

Businesses are beginning to realize that the burden of analysis is relieved through the energy and expertise of the business analyst. Business analysts, working to support project portfolio managers, provide the enterprise analysis, tools, processes and actionable information so decision makers can make the best project investments.

Business analysts start their work by using an array of analysis techniques to understand the current situation, including: competitive analysis, benchmark analysis, technology analysis, environmental analysis, organizational capability analysis, problem analysis, opportunity analysis, and market analysis. Armed with the results of these studies, they work with a passionate expert team to spark the creativity needed to determine the most innovative solutions. The business analyst facilitates innovation sessions by using techniques to promote real dialogue, experimentation, imagination, prototyping, and modeling, while participants are challenging and building on each others’ ideas. They then identify the opportunities that appear to be the most feasible and prepare the business case for the new initiatives. This is the work of the enterprise business analysis that is often missing in our business practices today – the BA who takes on “the burden of analysis.” Once funding is received, the business analyst is more tactically focused toward defining and managing the requirements to meet the business need and capitalize on the new opportunity - the work we all tend to think of as the totality of business analysis.

Experts agree that an important component of innovation is an organization’s business analysis capabilities. Projects fail to meet the business need and opportunities are lost when requirements are poorly defined, strategic alignment is questionable, and inadequate focus is placed on the business.

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COMMENTS

ajmarkos posted on Sunday, December 4, 2011 1:03 PM
Hi

What is the current state of the art of BA practices? If one looks up the word "analysis" in a dictionary, chances are that the first listed definition will read something like "Partitioning an entity into its component parts and then examining how those parts interrelate."

This definition is however problematic for those who are tasked with analyzing automated and manual business systems. One can not see, feel, or touch such entities, which makes logically, naturally partitioning them (i.e., dividing them up, often for the purpose of decomposition) very difficult.

So how does this issue play out? Well the BABOK 2.0 is very informative. Comparatively side issues like meeting management are given top billing while the main thing that needs to be done, partitioning, is barely talked about. Sounds just like the way analysis proceeds in just about all orgainzations.

In a way, one can not fault the BABOK. It's intent, as it publishers emphasize, is to just reflect commonly accepted BA practices.

But the commonly accepted pracitices of today are not going to move us up in maturity, especially, when the need is to move from being so tactical [read to be detail oriented] to strategic [read to be strong abstract thinkers].


Tony




Khass posted on Friday, December 30, 2011 12:04 PM
Hi Tony,
Very insightful comments. I totally agree - which is why I wrote the new book: The Enterprise Business Analyst: Developing Creative Solutions to Comples Business Problems. It is all about the BA becoming a strategic, creative leader of innovative chang.
samuelafricker posted on Monday, February 13, 2012 11:19 AM
Dear all:

Your blog post and comments inspired students of mine and myself to elicit a current snapshot of state-of-art in real-world industry - beyond the opinions of CEOs. We hope to be able to report the results in this blog here and complement the view given by you, Lori and Kathleen, with hard empirical evidence.

To do so we are, however, dependent on your support. We cannot force anybody to answer and spread the following survey http://bit.ly/re-survey. However, we believe that if every body contributes and spreads the survey, we will get a rather accurate picture of which practices are implemented, which ones not, and in which circumstances given practices are implemented.

/Sam
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