Business analysis is a systematic process for identifying business needs, solving problems, and discovering opportunities that enable growth and efficiency. It also involves the analysis of processes, technologies, and organizational structures to make decisions based on data.
A business analyst understands both the internal and external factors and helps the organization make wiser, more strategic choices. Business analysis gives the basis through which problems can be identified, opportunities for growth discovered, and guidance made for decision-making processes within organizations.
Business analysts use various techniques for data analysis, predicting trends, and making insight to help businesses stay competitive in the environment.
Following are ten of the key business analysis techniques that have become vital tools for professionals in the practice of this specialty:
- SWOT Analysis (Strengths, Weaknesses, Opportunities, Threats)
- PESTLE Analysis (Political, Economic, Social, Technological, Legal, Environmental)
- VMOST Analysis (Vision, Mission, Objectives, Strategy, Tactics)
- Gap Analysis
- Business Process Modeling (BPM)
- Brainstorming and Mind Mapping
- Root Cause Analysis (RCA)
- Use Case Modeling
- Stakeholder Analysis
- Cost-Benefit Analysis (CBA)
1. SWOT analysis (Strengths, Weaknesses, Opportunities, Threats)
SWOT analysis is a simple but an important tool intended to help identify the internal and external factors that influence an organization. By naming the strengths and weaknesses, which are internal factors, and opportunities and threats, which are external factors, analysts develop a strategy that will leverage those advantages and reduce risks. This is an effective method in strategic planning because the teams can take on challenges but will be fully aware of both their strong and weak points.
2. PESTLE Analysis (Political, Economic, Social, Technological, Legal, Environmental)
The PESTLE analysis helps in comprehending the larger macro-environmental factors that might have an effect on an organization.
It helps businesses determine how external factors may affect business operations and strategic decisions by analyzing political, economic, social, technological, legal, and environmental aspects.
This will provide a great technique for planning purposes and risk management since companies can proactively adjust to changes in the business landscape.
3. VMOST Analysis (Vision, Mission, Objectives, Strategy, Tactics)
VMOST analysis is a framework through which the business activities are to be aligned with core organizational goals.
VMOST begins with the mission, stating of objectives, strategizing pathways to achieve those objectives, and making tactics.
MOST is meant to ensure that what one is doing day in and out is contributing to the larger mission.
4. Gap Analysis
Gap analysis basically calculates the gap between what an enterprises is doing and what an enterprise wants to do.
Such an analysis of the gap may indicate either a process, resource, or capability mismatch to identify where it should be better.
5. Business Process Modeling (BPM)
BPM is the methodology of showing the working process of an organization by diagrams or flowcharts.
It helps enterprises detect inefficiency, optimize the processes, and ensures all steps of a workflow conform to organizational goals.
BPM plays an important role in the smoothening of operations and raising productivity levels in greater accordance.
6. Brainstorming and mind mapping
Brainstorming and mind mapping is a group creativity technique intended to produce a great number of ideas or solutions concerning a particular issue.
That is the method to come efficiently to solutions, plan projects, or provide innovation in teams and encourage varied input and creative thought.
7. Root Cause Analysis (RCA) Definition:
The RCA is the method of problem solving, a way to find out the basic cause of the problem. Investigation will be carried out beyond symptoms for finding the origin of the problem so that the solution developed will not allow it to recur.
- Ishikawa Diagram – The Ishikawa Diagram, also called the Fishbone Diagram, is a visualization tool useful in employing Root Cause Analysis to identify possible causes of problems. It groups causes in a structured way under headings such as People, Process, Equipment, Material, Environment, and Management, thereby, it can be more easily revealed, communicated, and prioritized as causes; hence, problem-solving is enhanced.
- 5 Whys – 5 Whys is a simple but effective technique to dig to the very root of a problem by repeatedly asking “why?”-Usually five iterations-in which the key is to ask questions of cause and effect. Developed by Toyota to facilitate its continuous improvement process, this is an easily learned and applied technique without specialized tools.
8. Use case modeling
Use case modeling refers to a technique utilized in gathering functional requirements from an end-user perspective for a system.
It emphasizes particular scenarios, or “use cases,” which define how users will interact with a system.
This helps a developer in designing systems that may cater to the needs and expectations of the users.
9. Stakeholder Analysis
Stakeholder analysis is one such method for identification through classification in regard to the degree of influence, interest, and levels of involvement.
This technique will enable the understanding of the stakeholder needs and potential impact so that businesses can accord appropriate priority for engagement and redressal
10. Cost-benefit analysis (CBA)
Cost-benefit analysis is a method that includes the proper estimation of costs expected and benefits foreseen, both in monetary terms, from projects or investments. Cost-benefit analysis is an accounting method in which an organization weighs its feasibility and profitability through comparing the total foreseen costs, which include investments and operational costs with benefits expected, like revenue accrued and savings. The Net Benefit calculation is an important constituent of CBA. Net Benefit gives the differential of the present value of benefits and costs. It is normally said to be financially viable if the NPV is positive.
