What is a Business Analysis and What does Business Analyst Do (2023)

It’s a competitive market out there, and businesses that want to succeed need to take advantage of every tool and resource within their reach. Smart decisions help businesses thrive, and reliable information is the key to intelligent decisions.

Enter business analysis. You are about to get a primer on business analysts—learning what they are, why they are needed, what they do, and how to become one. If you’re running a business, you may realize why you need one in your organization, while those of you who are looking for a good career may have just found one!

Let’s take our first steps into a business analyst’s world by first understanding what is business analysis.

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What is Business Analysis?

Business analysis is a combination of gaining insight from data using specific techniques, and performing tasks to identify the needs of a business—then, recommending changes and providing solutions that produce value for the stakeholders. Many of the solutions potentially have software and digital data-based components, but can also incorporate organizational changes, like improving processes, developing new policies, and engaging in strategic planning.

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What is a Business Analysis and What does Business Analyst Do (1)

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What Does a Business Analyst Do?

Business analysts are agents of change—professionals who analyze a business or organization, by documenting its systems and processes, assessing its business model, identifying vulnerabilities, and devising solutions.

Business analysts go by many other job titles, including:

  • Business Architect
  • Business Intelligence Analyst
  • Business Systems Analyst
  • Data Scientist
  • Enterprise Analyst
  • Management Consultant
  • Process Analyst
  • Product Manager
  • Product Owner
  • Requirements Engineer
  • Systems Analyst

Bear in mind that some organizations also use the term “IT Business Analyst.” Although there seems to be no clear consensus regarding the differences between the two positions (and, in fact, many organizations use them interchangeably), some circles note that the IT Business Analyst works more with software methodologies.

Once the business analysis definition is locked down, the more curiosity-driven reader may follow up by asking, “In that case, what is business impact analysis?” Business impact analysis is a practice that’s of particular relevance in these days of pandemic-induced business shutdowns. Business impact analysis, or BIA, aims to predict and identify the financial and operational impacts of business disruption. You can be sure that before many businesses closed temporarily due to the coronavirus, they launched business impact analysis studies.

Now that we have gone through to understand what is business analysis, let us next look at the difference between business analysis and business analytics.

Difference Between Business Analysis and Business Analytics

We should take a moment and clarify the distinction between these two concepts. Business analysis is more concerned with functions and processes, while business analytics covers data and reporting. Still, many organizations use the terms interchangeably.

As we have learned what a business analyst is, let us understand business analysis uses.

Why Use Business Analysis?

Thanks mostly to the breathtaking pace of today’s technological advancements, the 21st century’s business world is one of rapid, constant change. Innovations change the way we live and work, and businesses must be able to adapt to these changes or get left behind.

Business analysts are the ideal professionals to shepherd any organization through the tricky terrain of change. Once they navigate through those changes, businesses emerge more robust, more competitive, and better equipped to handle the ever-evolving world of digital-based business.

(Video) Who Is A Business Analyst?| What Does A Business Analyst Do? - Roles & Responsibilities |Simplilearn

After having understood what is a business analyst, let us next look at the business analysis process.

What is the Business Analysis Process?

These are the widely accepted steps in the business analysis process. Each company’s needs and situations are different, however, so there may be some variance.

  1. Get orientedMake sure to clarify the business analyst’s role, determine the stakeholders’ perspective, and get familiar with the project’s history.
  2. Name the primary business objectives. Identify the primary stakeholders’ expectations, reconcile conflicting expectations, and make sure the objectives are clear and actionable.
  3. Define the project’s scope. You need a clear and complete statement of the project’s scope—a rough roadmap of all the steps the project participants must follow.
  4. Create a business analysis plan. List timelines, steps, and deliverables.
  5. Define requirements. You need concise, clear, and actionable requirements, based on analyzing the information gathered so far.
  6. Support the technical implementation. Since many solutions require using software, the business analyst needs to work closely with IT teams.
  7. Help implement the solution. This step involves creating clear documentation and training end-users.
  8. Assess value. Did the project work? How much progress did the organization make? Are there any needed follow-ups?

While looking into the various aspects of business analysis, we have learned what is business analysis so let us next learn its various techniques.

What are the Different Techniques of Business Analysis?

Countless hurdles and obstacles face any company that wants to stay on top of the heap. Fortunately, there are also a handful of varying business analysis techniques—brace yourself for a flood of acronyms.

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  • CATWOE (Customers, Actors, Transformation Process, World View, Owner, and Environmental Constraints). This technique identifies the main parties and processes potentially affected by any action the business undertakes. This technique helps business analysts to thoroughly evaluate how a proposed action will affect a collection of different parties and elements.
  • MoSCoW (Must or Should, Could or Would). This process prioritizes requirements by presenting a framework where every single demand is evaluated compared to other requirements. Is it a must-have or a should-have? Is it something that could improve the product or something that would be an ideal future element?
  • MOST (Mission, Objectives, Strategies, and Tactics). Business analysts use these elements to conduct a detailed and complete internal analysis of an organization’s goals and how to handle each one.
  • PESTLE (Political, Economic, Sociological, Technological, Legal, and Environmental). Business analysts use the PESTLE model to evaluate the various external factors that can potentially affect their company and how best to address them.
  • SWOT (Strengths, Weaknesses, Opportunities, and Threats). This technique identifies a corporate structure’s areas of strength and weakness, translating them into opportunities and threats. The knowledge gained helps determine proper resource allocation.
  • Six Thinking Hats. This analysis process directs a group’s line of thinking by brainstorming alternate perspectives and ideas. The ‘six hats’ in question are White (focus on your data, logic), Red (uses gut feelings, emotions, intuition), Black (potential negative results, what can go wrong), Yellow (focus on positives, optimistic), Green (creativity), and Blue (process control, the big-picture overview).
  • The 5 Whys. Commonly found in Six Sigma and business analysis techniques, this series of leading questions, all posed with “Why?”, helps business analysts identify a problem’s origin by asking why a situation exists, then raising another “why?” question to the answer, and so on.

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What is a Business Analysis and What does Business Analyst Do (3)

We have understood so much about business analysis, beginning from what is business analysis, the process, uses, and more. Let us next look at the benefits.

How Does a Company Benefit from Business Analysis?

Business analysts bring a disciplined approach to creating and managing change within an organization. They identify vulnerabilities, define needs based on feedback and stakeholder communication, organize and implement solutions, and monitor the results.

In today’s competitive environment, businesses of all sizes need every possible advantage that they can get, and the business analyst is a valuable resource for identifying the best moves to make, on both a tactical and strategic scale. Furthermore, business analysts make ideal project managers.

By employing a business analyst, companies gain a better understanding of themselves and their needs, and how best to meet them. As we have learned what is a business analyst, the various techniques, the business analysis process, and more let us look into the benefits of getting certified.

(Video) What is business analysis? What do business analysts do? -Business Analyst Training

The Benefits of Certification

The certification process yields advantages to the professional and organization alike. For the individual, certification imparts skills and training that any good business analyst needs to succeed. Business analysis is not a career where you can mostly learn as you go! Entering a new position with a complete and robust skillset is the only way you will succeed.

Certification also grants you a tangible milestone, an easily measured achievement that tells prospective employers, “I know what I’m doing.” When you sit down for that interview, your certification is a verification of your qualifications. Certification helps you open the door to a better, more lucrative career in business analytics.

For the organization, certification assures the business that they have the right choice for the position. The interview process can be tricky, fraught with uncertainty. It’s also time-consuming and costly, so the organization should strive to make the right choice the first time by ensuring a mutually beneficial fit. Certification assures the candidate’s competency in the subject matter.

We have learned what is business analysis, next, let us look at the skills and qualifications of a business analyst.

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What Skills and Qualifications Does a Business Analyst Need?

When we talk about what is business analysis and what makes a good business analyst, we must focus on the relevant necessary skills. Business analysts required a range of soft and hard skills, including experience in either IT or business-related backgrounds. For the IT side, that means knowing how to pull, analyze, and report on data trends, as well as sharing that information in a clear way. For the business side, you need to have at least a basic understanding of how systems, tools, and products work.

Business analysts should have a bachelor’s degree in Business or a related field, or alternately, an MBA. Furthermore, most businesses want the candidate to have some work-related experience in business analysis or a related field, usually about five years’ worth.

According to the Institute of Business Analysis, a good analyst needs the following skills and knowledge:

  • Analytical thinking and problem solving
  • Communication skills (oral and written)
  • Interpersonal and consultative skills
  • Costs benefit analysis
  • Facilitation skills
  • Detail-oriented and able to deliver at a high level of accuracy
  • Organizational skills
  • Processes modeling
  • Knowledge of business structures
  • Stakeholder analysis
  • Requirements engineering
  • Understanding of how networks, databases and other technologies work

How Would You Like to Become a Business Analyst?

Business analysts are in high demand and fetch excellent compensation. Salary.com reports an annual average of USD 75,400. If this sounds like a smart career move to you, then check out Simplilearn’s new Post Graduate Program in Business Analysis in partnership with Purdue University.

The program is designed to hone your expertise in the latest business analytics tools and techniques, including planning and monitoring, data analysis and statistics, visualizations, Agile Scrum methodologies, and SQL databases.

(Video) Intro to Business Analysis

On the other hand, if you wish to become a pro business analyst, and add a shining name, i.e., Carlson School of Management certification to your resume, you must join umn business analytics course. Leverage the UMN edge today, explore more and enroll right away!


What is business analysis in simple words? ›

Business analysis is used to identify and articulate the need for change in how organizations work, and to facilitate that change. As business analysts, we identify and define the solutions that will maximize the value delivered by an organization to its stakeholders.

What does a business analyst really do? ›

Managing projects, developing project plans, monitoring performance, and ensuring timely turnover of deliverables. Communicate changes, recommendations, and procedures to business teams. Remain engaged with business leaders to help them understand how changes impact the goals of the organization.

What are the three main roles of a business analyst? ›

Business analyst job description

Creating a detailed business analysis, outlining problems, opportunities and solutions for a business. Budgeting and forecasting. Planning and monitoring.

What skills should business analysts have select an answer? ›

You can answer this by stating that a business analyst must have exceptional communication and negotiation skills. Analytical thinking, problem-solving, and decision making are also vital attributes. A business analyst should have industry knowledge, business process management skills along with technical proficiency.

What are the 3 types of business analytics? ›

There are three types of analytics that businesses use to drive their decision making; descriptive analytics, which tell us what has already happened; predictive analytics, which show us what could happen, and finally, prescriptive analytics, which inform us what should happen in the future.

What are examples of business analytics? ›

Real-World Business Analytics Examples
  • Growing sales. ...
  • Developing marketing strategies. ...
  • Using predictive analytics. ...
  • Improving financial efficiency. ...
  • Increasing productivity through streamlined processes.

What is the most important thing for a business analyst? ›

Critical thinking, problem-solving, and decision-making are three crucial strengths that are required from a good business analyst. Having industry or business knowledge and management skills are also a plus.

What do business analyst do everyday? ›

A business analyst's daily job duties include identifying business issues, collecting and recording data, analyzing data, and evaluating and presenting data solutions. They work with several groups including customer service management, product development, business operations, and business clients.

What is a key role the BA plays? ›

The key role a business analyst plays when conducting an analysis of a business is requirements management. The modern business environment is complex and the business analyst's role is to maintain requirements through constant change by using innovation to do so.

What qualities should a good business analyst have? ›

6 Personal Traits That a Professional Business Analyst Should...
  • Good communication skills. Business analysts must have communication skills as they have to communicate with a variety of stakeholders. ...
  • Active listening skills. ...
  • Problem-solving skills. ...
  • Analytic skills. ...
  • Multi-disciplinary skills. ...
  • Decision-facilitation skills.
8 May 2019

What is an entry level business analyst? ›

Entry-level business analysts, or junior business analysts, support the collection and analysis of data for a business or organization, providing better solutions, technology integration, or systems improvements.

What is your greatest strength business analyst? ›

Communication skills: communication skills is one of the key strengths of a Business analyst as it plays an important role right from eliciting requirements from stakeholders, explaining them to the team, getting work done from them in the designed way. The way we express makes the job easier for us.

How do business analyst use Excel? ›

The following are some of the most important features of Excel that Business Analysts use:
  • Working with IF formulas. ...
  • Using VLOOKUP. ...
  • Extracting clarity from clutter. ...
  • Uncovering data patterns. ...
  • Documenting spreadsheet systems. ...
  • Using PivotTables. ...
  • Visualizing data. ...
  • Understanding industry-relevant Excel features.
3 Jun 2022

How do I pass a business analyst interview? ›

Best Business Analyst Interview Preparation Guidance for 2022
  1. First, take a look at the job posting. What skills are they looking for? ...
  2. Next, brush up on your knowledge of the company. Research their history, mission statement, and any recent news stories.
  3. Finally, practice your answers to common interview questions.

What are the four pillars of business analytics? ›

That's why it's important to understand the four levels of analytics: descriptive, diagnostic, predictive and prescriptive.
  • Descriptive analytics.
  • Diagnostic analytics.
  • Predictive analytics.
  • Prescriptive analytics.

Which type of business analytics is best? ›

Prescriptive analytics is the most important type of business analytics. It tells what will happen in a business and how it could happen if taken certain steps. It results in rules and recommends the action steps to be taken.

Where is business analytics used? ›

Although business analytics is being leveraged in most commercial sectors and industries, the following applications are the most common.
  • Credit Card Companies. ...
  • Customer Relationship Management (CRM) ...
  • Finance. ...
  • Human Resources. ...
  • Manufacturing. ...
  • Marketing.
8 Oct 2021

Who uses business analytics? ›

Typically, commerical organizations use business analytics in order to: Analyze data from multiple sources. Use advanced analytics and statistics to find hidden patterns in large datasets. Deseminate information to relevant stakeholders through interactive dashboards and reports.

What data is used in business analytics? ›

Whereas BI studies historical data to guide business decision-making, business analytics is about looking forward. It uses data mining, data modeling, and machine learning to answer “why” something happened and predict what might happen in the future.

What hard skills does a business analyst need? ›

Core Business Analytics Skills
  • A good communicator. ...
  • Inquisitive. ...
  • A problem solver. ...
  • A critical thinker. ...
  • A visualizer. ...
  • Both detail-oriented and a big picture thinker. ...
  • SQL. ...
  • Statistical languages.

Does a business analyst need IT skills? ›

While business analysts are generally not required to write code, it is often helpful for them to have a foundational understanding of basic programming languages, such as Java, C++, Visual Basic and PHP. You'll be able to apply this working knowledge as you identify company challenges and develop solutions.

What is another name for a business analyst? ›

On the one hand, «business analyst» is an umbrella term for all roles in this list and many more (like “data analyst,” “enterprise analyst,” “process analyst,” “system analyst”).

How do you introduce yourself in a business analyst interview? ›

The first sentence of your introduction should tell the interviewer that you want them to listen and understand who you are as a person and why they should care about what it is that you have to say. Remember, focus on your skills and experiences relevant to the role.

Does a business analyst do testing? ›

So, a BA doesn't run testing, but they can participate in preparing test cases. For example, a BA specialist can check if the tests are written in conformance with the requirements. A Business Analyst can also be on the list of people authorized to sign a testing plan.

Is SQL required for business analyst? ›

SQL is the language in which we can tell the computer to perform that operation. With big data and relational databases being the new norm for most companies, SQL knowledge is a prerequisite for almost any business analyst job.

Which tools business analyst should know? ›

Top business analytics tools are used to efficiently accomplish the following Business Analyst tasks:
  • Requirements management. ...
  • Project management. ...
  • Enterprise resource planning (ERP) ...
  • Modeling / Diagramming. ...
  • Wireframing. ...
  • Collaboration / Communication. ...
  • Customer relationship management (CRM)

What are the weakness of a business analyst? ›

The weak business analyst often fails to make use of all available resources. He may be unfamiliar with some resources as well. These resources may include industry reports, software packages or assessment tools.

Can I be a business analyst without experience? ›

Can You Become a Business Analyst With No Experience? In short, yes. While many organizations seek candidates who have at least some experience in a business analyst role, there are ways to work around this requirement by developing and demonstrating the skills needed to do the job of BA.

Can I be an analyst with no experience? ›

The short answer is yes, it's entirely possible—and yes, employers will be open to hiring you (even without any prior experience). In this post, we'll explain exactly why and how. We'll answer the following questions: Is it possible to become a data analyst with no previous experience?

Why should we hire you answer best? ›

Show that you have skills and experience to do the job and deliver great results. You never know what other candidates offer to the company. But you know you: emphasize your key skills, strengths, talents, work experience, and professional achievements that are fundamental to getting great things done on this position.

What motivates you as a business analyst? ›

The key business motivators for business analysis are Curiosity, Attention, Respect, Appreciation, and Trust, abbreviated as CARAT. Curiosity about the business and its values launches discovery of what the business needs from a solution.

Why did you choose business analyst? ›

“One of the main reasons I want to be a business analyst is because I like to be able to see a direct relationship between my efforts and the company's success. In my summer work term, I was able to improve the company's operational efficiencies resulting in a cost savings of 2%.”

How can I learn business analytics? ›

How to Learn Business Analytics
  1. Earn an MBA. ...
  2. Enroll in an Online Business Analytics Course. ...
  3. Gain Hands-On Experience. ...
  4. Leverage Your Network. ...
  5. Dedicate Time to Your Learning.
1 Oct 2019

What is VLOOKUP in Excel? ›

When you need to find information in a large spreadsheet, or you are always looking for the same kind of information, use the VLOOKUP function. VLOOKUP works a lot like a phone book, where you start with the piece of data you know, like someone's name, in order to find out what you don't know, like their phone number.

What are the 3 common uses for Excel? ›

The main uses of Excel include: Data entry. Data management. Accounting.

What are the challenges you face as a business analyst? ›

One of the common challenges faced by the Business Analyst is resolving conflicts. These conflicts could arise due to various factors such as team members proposing a new idea for the project, arguing over its implementation, timelines and more.

What should I do before business analyst? ›

Getting your bachelor's degree in a quantitative field like economics, finance, computer science, data science, statistics, information management, or a similar field can prepare you for business analysis jobs.

What questions do business analysts ask? ›

8 Questions Every Business Analyst Should Ask
  • What problem is this business having that you hope to solve by developing this project? ...
  • What is the business doing at present to alleviate or solve the issue? ...
  • What inside resources will this project be utilizing? ...
  • Have you determined a vision for the project?

Is business analyst a stressful job? ›

Business analysis could become stressful in some way at some point in time. But it doesn't mean, only your job is stressful and other jobs are easy to do. Every job could lead to a stressful situation but it is up to the person, how he/she handles it.

Is business analyst a hard job? ›

Being a business analyst can be tough. Being a business analyst can be tough because, at one point in your career, you'll have to deliver inputs or outputs for a project despite encountering many problems and roadblocks that make being a business analyst a tough job.

Is business analyst a high paying job? ›

Even Business Analysts in less technically demanding positions routinely earn an average salary that sits comfortably in the high five-figure range, and often into six figures for Business Analysts in senior positions.

Do business analysts make a lot of money? ›

Yes, business analysts make a lot of money.

The average business analyst averages $78,995 a year. However, this ranges from as low as $70,041 a year to as high as $158,675 a year. Factors such as location, experience, and company type all impact the earning potential for business analysts.

Can a shy person be a business analyst? ›

Not every introverted individual tends to have difficulty in adjusting to social situations. If you are an introvert like me (accidental confession) and are contemplating the career switch to a business analyst, congratulations! This is one of the best career paths suitable for your personality type.

Is business analyst a IT job? ›

IT business analysts are experts in both business administration and information technology. Their primary responsibilities include liaising between IT and the executive branch, improving the quality of IT services, and analyzing business needs.

Which field is best for business analyst? ›

Most entry-level business analyst positions require a minimum of a bachelor's degree, usually in accounting, finance, management, or IT.
6 Best Business Analyst Career Paths
  • Business Analyst Manager.
  • Data Business Analyst.
  • Data Analysis Scientist.
  • Information Security Analyst.
  • IT Business Analyst.
  • Quantitative Analyst.
1 Sept 2022

How much IT knowledge is enough for a business analyst? ›

A bachelor's degree in information technology and at least three years of expertise with computer programmes are required. You must be a Microsoft Office professional, including Project, with great written and oral communication abilities. You'll need to be an expert in data analysis and have programming skills.

What challenges do business analyst face? ›

Possible solution

Requirements elicitation problems: requirements were not fully defined, not all the “right” users/stakeholders were involved in an elicitation and approval process. Improvement of the requirements elicitation process. Requirements review by stakeholders.

What business analyst does not do? ›

Business Analysts are not Project Managers

The technical and business teams each are driven by different sets of often conflicting priorities. Each side needs an advocate, and when a situation arises that calls for one side to make a sacrifice, that decision falls to the project manager.

What is the most difficult part of being a business analyst? ›

One of the biggest challenges that business analysts face is knowing the project scope. The project scope is the “what” and “why” of a project. It is the foundation of a business analyst's job. Answering the “what” and “why” gives us a clear picture of our role in the project and how we will be involved.

Will business analyst be replaced by AI? ›

If it were artificial intelligence, this skill isn't attainable because robots are designed to only understand in a specific way. So, will AI now race business analysis? Not certainly in the near future. A business analyst needs to develop good time management skills.

What is the next job after business analyst? ›

After eight to 10 years in various business analysis positions, you could advance to chief technology officer, chief operating officer, project management office director, or work as a consultant.

What does entry level business analyst do? ›

Entry-level business analysts, or junior business analysts, support the collection and analysis of data for a business or organization, providing better solutions, technology integration, or systems improvements.

How many hours does a business analyst work a day? ›

Business analysts typically work a standard a 40-hour week, but flexible hours and overtime may be sometimes be required.


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