Business Analysis: Why Is It Necessary For Your Business Growth
Sep 22, 2020 ● 7 min read
In today's changing world, it is challenging for companies to please all their customers. Their difficulty further increases with competitors always trying to steal the customers' attention. If you want the business to keep up in such a market, you will have to make it better with each passing day. This is where business analysis comes to the rescue. It helps organizations in growing their present situation according to their previous actions. Therefore, companies can mend their processes to meet market requirements. Don't worry if all this sounds confusing right now. With the help of this guide, you will understand everything about business analysis. So without further ado, let's get started.
Table of Contents
What Is Business Analysis?
Business analysis can be recognized as a multistage process of project management that provides you with a view of various business needs and helps you resolve business problems. It consists of techniques that can be used to develop plans and implement them to achieve the desired goals. On the other hand, business analysts use these techniques to determine how and when to implement vital changes.
In the current scenario, a business analysis may be described in terms of data. Every business today holds a tremendous amount of internal and external information. It is almost impossible for someone to sit and understand this data. According to this, the business analysis uses tools and techniques for evaluating the information and solving business problems. You can use Business analysis tools like Whatagraph for this purpose.
As different obstacles get fixed, companies can fulfill their customers' requirements and develop themselves. Plus, an action plan can be created to meet the business objective. Irrespective of your industry and project type, the business analysis will always come in handy. That is why you must understand the process.
What Is The Business Analysis Process?
To ensure that the alterations meet the ultimate goals, a specific analysis process is followed. The entire procedure includes the following steps:
Step 1: Information Collection
The process of business analysis starts with collecting all the relevant information on the project. The data should cover topics like project scope, risks, influential factors, and other organizational aspects. Two was to gather the data are:
- Research: An efficient way to collect data is from some previously done work. For example, you can look into the other company projects to see how work gets done and what factors affect the projects. It is essential to analyze only the relevant tasks to get the most relevant results.
- Discussion: To get information about the organization or the internal processes, you can discuss the topic with related people. For example, a project manager can tell you how things are done within the company. So you will get an idea of everything.
Step 2: Relevance Analysis
Most of the projects fail because they aren't implemented correctly. People start working on the requested design and never test whether or not it is fulfilling the project requirements. To avoid this, the business analysis process is used. Through the collected information, you will have to analyze the direction of the project. You need to ensure that current and planned future developments work according to the project scope.
Step 3: Solving Problems
No project ever moves as decided due to various factors. If the company wants to make the most out of the project, they need to study these factors and see what changes should be made. The third step of the business analysis process helps with that. During the relevance analysis, you will find various issues with the development. It would help if you found suitable and cost-effective solutions to these problems. Remember that the project's quality should be maintained or increased during this entire process. Even if you have to take some additional measures for improvement, you should do that. Your ultimate aim should be to produce an efficient project within the least possible investment.
Depending on the stage of the project, some other steps may be included in this process.
Why Is Business Analysis Important?
By now, you must have realized that business analysis helps grow your business. But how exactly it does that? Here are a few benefits of business analysis that will show you how the process develops your company.
#1 To Understand The Business
As the process includes a complete analysis of the business, it can help you learn more about your company. You can thoroughly study the structure and dynamics of the organization. So when you know the business requirements in a better way, you will be able to make appropriate plans for achieving the goals. Even with changing times, new organizational needs can be discovered through business analysis. This will help in bringing suitable changes to meet the current market demands. Analysts may take the help of business analysis tools like Whatagraph to perform the analysis and get insights.
#2 To Reduce The Overall Costs
Business analysis is analyzing and creating plans for the project. Hence, business analysts help in preparing strategies to solve problems more efficiently. They also describe these approaches to the teams so that they can work accordingly. This reduces the re-work that the group may have done due to the wrong approach. The decreased repetition doesn't only reduce the efforts, but it also minimizes the project's cost. Even if you have to pay a significant amount to the analyst, you will still profit with cost reduction.
#3 To Bring An Increase In ROI
Return On Investment (ROI) is used to examine how beneficial your investments are. Now, the type of investment depends on the project you are developing. For example, in a software development project, investment means the used tools, efforts put in by the software development company, the team's time, etc. ROI, on the other hand, is the benefits you receive through this project. It can be in terms of money, customers, or any other thing.
From the last point, we can see that business analysis already reduces the investment part's cost. To increase the ROI further, the process also focuses on other company aspects than project development. It analyses everything that may be affecting the ROI. So an overall improvement can be made to the company for increasing its ROI.
#4 For Decision-Making
Your company must be collecting tremendous amounts of data by now. But is it making use of that information? If not, then the business analysis process can help you with that. It gives you insights through that data, which can assist in better decision-making. Plus, business analysts understand the organization inside out. Therefore, they can come up with logical topics to make the decision-making process easier and faster. They won't be wandering here and there to look for appropriate solutions.
#5 For Improvement With Time
With the growth of your organization, its requirements, and the stakeholders' investment will increase. If you continue working with the old framework, your initial team won't be able to match the level of the new one. But with business analysis, with can be resolved quickly. A business analyst can help sync both the teams and make it possible for the company to handle more projects.
What Are The Business Analysis Techniques?
Some of the essential techniques that can be followed for business analysis are:
MOST: It stands for Mission, Objectives, Strategies. Through this, you can get an insight into what has to be done and how to do it.
SWOT: Strengths, Weaknesses, Opportunities, and Threats is a technique used to find the powers and vulnerabilities of the business. So you can allocate resources according to that.
PESTLE: This addresses the influential external factors like Political, Economic, Sociological, Technical, Legal, and Environmental (PESTLE).
The 5 Whys: The best way to find a solution is by asking the correct questions. So the five whys help in finding out the root cause of any problem.
CATWOE: This analyzes factors like Customers, Actors, Transformation Process, World View, Owner, and Environmental (CATWOE) that can be affected by any company action.
Six Thinking Hats: Thinking from just one point of view doesn't lead you anywhere. That is why this technique is used to analyze six different perspectives and ideas.
MosCow: The Must or Should, Could or Would (MoSCoW) helps evaluate each requirement's priority while keeping all others in mind.
How Do Business Analysis Tools Work?
Many tools, such as Whatagraph, are present in the market to assist in the business analysis process. But before opting for them, you must understand their advantages and work. So you won't have any confusion later.
#1 It Reduces Manual Working
The first benefit of opting for any automatic tool is that it reduces manual work. With the help of business analysis tools, the efforts of collecting the data and seeking patterns from it can be minimized. The tool connects itself with your data sources and provides useful infographics or details on how things are working. Along with efforts, even the number of manual errors gets reduced with these tools. They work more efficiently. Thus, you get more accurate and reliable results.
#2 It Improves Communication
Developing a project requires input from several teams. For example, front-end developers need to co-operate with the back-end ones to see how everything is working. This involves a lot of communication, which wastes both time and effort. It can also delay the development of the project. To avoid this, business analysis tools can be used. They help in keeping all the progress in one place to minimize the communication part. So whenever a team wants insights, they can use the tool instead of calling or sending emails to the other team members.
#3 It Helps In Looking For Problems
While collecting the information manually, you may miss out on some factors. This can lead to future trouble. On the flip side, business analysis tools never make this mistake. They gather all the data and provide appropriate reports on it. So you can quickly look for problems and find better solutions for them. In simple terms, these tools help improve the overall quality of the project by providing you with proper data analysis.
#4 It Makes The Work More Efficient
It wouldn't be wrong to state that humans always tend to make mistakes. Imagine if you forget to inform the teams about some critical deadlines, and the project gets delayed. This can create a big problem while increasing the overall duration of project completion. But when you use business analysis tools, you won't have to worry about these issues. As soon as you get the information on deadlines, you can put them into the device. The team members will be automatically notified about the update and will work accordingly. So the work will get done on time, decreasing the overall completion period.
This was all about business analysis, its importance, process, techniques, and tools. While you are dealing with all aspects of the company, you shouldn't tackle this process on your own. To make sure you are benefitting from it, you can hire a business analyst and use business analysis tools. The analyst will ensure that the work proceeds seamlessly, while the tools will help eliminate all mistakes.