In a constantly evolving world, business practices need to change to adapt with the times. This makes business analysis important. Business analysis is the process of constantly identifying changing business needs regarding organizational framework and policies and practices and finding solutions for the same.
Business process analysis skills are needed even in individual fields such as product or project management, quality assurance or interaction design. Business analysts try to maximize stakeholder profits through the changes and business solutions they provide. Since these changes can affect the entire organization and cause disruption, business analysts use rigorous business analysis techniques to identify the gaps or business needs.
Let’s have a look at some of these business analysis techniques.
Business Analysis Tools And Techniques
The requirement for business analysis arises when deciding the future path of the organization, as well as for specific projects. Business analysis tools and techniques help to determine the best approach, as well as at the end of a project, to determine what could have been done differently for better results. Here we look at some of these tools and techniques:
1. SWOT Analysis
The S-W-O-T or Strength-Weaknesses-Opportunities-Threats analysis is the most common and most used technique in business analysis.
In SWOT, internal components affecting the organization are represented by the strengths and weaknesses, while the external factors are represented by the opportunities and threats.
Strengths of the organization are factors that give it a competitive advantage, like its location, employees, infrastructure, customer relations, stellar products, etc.
Weakness refers to the limitations or disadvantages an organization suffers, such as a bad reputation, incomplete or unpopular products, weak customer relations and incompetent or inefficient employees.
Opportunities refer to the external conditions or factors that can provide a competitive edge. For example, the Covid-19 bound people to their homes and presented an opportunity for technology companies to create technologies that would help people work from home efficiently.
Threats refer to those external conditions that can harm the business. For example, a change in technology to touchscreen phones presented a threat to the older keypad phones.
2. PESTLE Analysis
The second most commonly used business analysis method is the PESTLE, or Political-Economic-Social-Technological-Legal-Environmental analysis.
Political factors like trade control laws, international trade restrictions or tariffs are incumbent on the government policies and frameworks. These factors determine how the business can be impacted because of state policies and government intervention.
Economic factors like currency exchange rates and inflation also have a great bearing on how business is done and how profitable it is.
Social factors are indicators of social trends which can impact business or bring a change in how business is done.
Technological factors are perhaps the most important in the current environment of fast-paced technological evolution. Organizations need to keep pace with changing technologies, or they may go out of business.
Legal factors such as privacy laws, discrimination laws, insurance laws or copyright laws are all essential to run a business legally.
Environmental factors such as floods, fires, droughts, pollution, general weather and climate change can all impact a wide variety of businesses.
3. MOST Analysis
The MOST or Mission-Objective-Strategy-Tactics analysis is a powerful business analysis method. The MOST analysis is a top-down approach, where it’s important to analyze and implement solutions that are in sync with the organization’s mission and objectives.
The mission of an organization defines the purpose of why an organization does business. Objectives define the goals for the different departments of an organization. The objectives need to be sharp to enable easy decision-making. They must be measurable to ensure optimum performance.
4. System Analysis
A system analysis is like a business process analysis, where all the components of a business system are analyzed. Decomposing the system into smaller processes or parts can give an in-depth understanding of the business system. This can help with quicker analyzes and better solutions to business problems.
5. Business Process Modelling (BPM)
In business process modelling, business analysis strategies, frameworks and techniques are assessed to have a more profound understanding of the business. Strategic planning, business model analysis, process design and technical analysis of business problems are parts of business process modeling. The steps of business process analysis are:
BPM is one of the best business analysis techniques, as it provides information about production, marketing, management and other business processes.
While this may popularly be seen as an activity, with a group of people thinking together, it provides insights and breakthroughs for important business challenges. It is one of the creative elicitation techniques in business analysis. It is often used in tandem with other business analysis strategies.
7. Requirement Analysis
Requirement analysis is a type of six sigma technique recommended for analyzing requirements. It is used across projects during different stages of the project lifecycle, but especially when the stakeholders have a solution to a business problem.
This six sigma technique is recommended for analyzing requirements because it is one of the best ways of elicitation in business analysis. User stories are an up-and-coming type of requirement analysis. Since user stories have a sharp user focus, they can be highly effective in determining user requirements.
Harappa’s Creating Solutions course is great for managers looking to analyze problems, find their root causes and explore different perspectives to find innovative solutions. The course modules offer business process analysis examples to help students learn from real-life cases. If you are looking to learn the elicitation techniques in business analysis, enrol for this course today!
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