1. What Is Business Analysis?
Business analysis is the practice of identifying business needs, understanding problems and opportunities, and determining solutions that deliver value to stakeholders.
A Business Analyst looks at three major areas:
• People
• Processes
• Technology
The goal is to understand how an organisation currently works, identify what needs to change, and help define a solution that supports the organisation's objectives.
Business analysis applies to many types of work, including:
• New projects
• System implementations
• Business process improvements
• Digital transformation
• Product development
• Organisational change
• Continuous improvement
For example, suppose a bank receives many customer complaints because opening an account takes three days.
A Business Analyst would investigate:
• Why does account opening take three days?
• Which teams are involved?
• Which steps create delays?
• Which systems are being used?
• What information does the customer provide?
• What regulations must the bank follow?
• What would the future process look like?
The BA then works with stakeholders to define requirements for improving the process.
2. The Role of the Business Analyst
A Business Analyst is not limited to one job title.
Business analysis represents a set of activities and responsibilities.
Different roles perform business analysis activities.
Examples include:
• Business Analyst
• Systems Analyst
• Product Manager
• Management Consultant
• Process Analyst
• Business Architect
• Product Owner
Systems Analyst
A Systems Analyst focuses heavily on technology and systems.
They help translate business needs into clear system requirements.
For example:
Business need:
"Customers need faster access to their account statements."
System requirement:
"The system shall allow customers to download statements for the previous 24 months in PDF format."
Management Consultant
A Management Consultant focuses on business strategy, operations and organisational problems.
For example, a consultant might analyse why a company's operating costs are increasing and recommend changes to its operating model.
Product Manager
A Product Manager focuses on creating products that deliver value to customers and the organisation.
They need to understand:
• Customer problems
• Market needs
• Business objectives
• Product opportunities
• Priorities
• Product performance
3. Why Business Analysis Is Valuable
Good business analysis reduces the risk of building the wrong solution.
Imagine a company spends £500,000 developing a new system.
Six months after launch, users complain that the system does not solve their problems.
The technical team might have built the system correctly.
The problem was poor understanding of the business need.
This is where business analysis provides value.
A BA helps an organisation:
• Understand the real problem
• Identify the right stakeholders
• Define clear requirements
• Manage stakeholder expectations
• Reduce misunderstandings
• Control scope
• Identify risks early
• Improve processes
• Support accurate cost estimates
• Support accurate delivery estimates
• Improve communication
• Measure whether the solution delivers value
A strong BA also challenges a proposed project when the project does not align with business objectives.
The question is not:
"How do we build this?"
The better question is:
"Why are we building this, and what business problem are we solving?"
4. The Six BABOK® Knowledge Areas
BABOK® v3 identifies six knowledge areas.
You should learn these because they form an important part of Business Analysis terminology.
- Business Analysis Planning and Monitoring
- Elicitation and Collaboration
- Requirements Life Cycle Management
- Strategy Analysis
- Requirements Analysis and Design Definition
- Solution Evaluation
4.1 Business Analysis Planning and Monitoring
This focuses on planning how the BA work will happen.
The BA considers:
• Who needs to be involved?
• How will information be gathered?
• How will requirements be documented?
• How will requirements be prioritised?
• How will stakeholders communicate?
• How will progress be monitored?
Stakeholder analysis forms an important part of planning.
4.2 Elicitation and Collaboration
Elicitation means obtaining information from stakeholders.
A BA does not simply wait for stakeholders to provide requirements.
The BA actively investigates and explores their needs.
Common elicitation techniques include:
• Interviews
• Workshops
• Surveys
• Observation
• Brainstorming
• Document analysis
• Focus groups
• Prototyping
For example, if you are developing a new hospital appointment system, you might interview:
• Doctors
• Nurses
• Reception staff
• Patients
• IT staff
• Managers
Each stakeholder sees the problem differently.
The BA brings those perspectives together.
5. Requirements Life Cycle Management
Requirements do not simply get written once and forgotten.
They need to be managed throughout the initiative.
The BA needs to understand:
• Where each requirement came from
• Why the requirement exists
• Who owns the requirement
• How important the requirement is
• What solution component satisfies it
• Whether the requirement has changed
This is where traceability becomes important.
For example:
Business requirement:
"Reduce customer onboarding time."
↓
Stakeholder requirement:
"Customer service staff need a faster customer verification process."
↓
Functional requirement:
"The system shall automatically retrieve customer information from the verification service."
↓
Test:
"Verify that customer information is retrieved automatically."
This creates a connection between the original business objective and the final solution.
6. Strategy Analysis
Strategy analysis focuses on understanding the current state and determining the desired future state.
A BA asks:
"Where are we now?"
"What do we want to achieve?"
"What is stopping us?"
"What needs to change?"
For example:
Current state:
• Customers complete paper forms.
• Staff manually enter information.
• Processing takes two days.
• Errors occur during data entry.
Future state:
• Customers complete digital forms.
• Information enters the system automatically.
• Processing takes 30 minutes.
• Validation reduces errors.
The BA then analyses the gap between the current state and future state.
This is known as gap analysis.
7. Requirements Analysis and Design Definition
This area focuses on analysing requirements and defining possible solutions.
Requirements need to be:
• Clear
• Relevant
• Testable
• Feasible
• Understandable
• Consistent
• Traceable
The BA works with stakeholders and technical teams to determine how the requirements might be satisfied.
Requirements and designs are closely connected.
As the team learns more about the problem, requirements might change.
As the team explores possible designs, new requirements might emerge.
Therefore, requirements and design evolve together.
8. Solution Evaluation
After implementing a solution, the BA needs to determine whether the solution delivered the expected value.
For example, suppose the business introduced an automated customer onboarding system.
The original objective was:
"Reduce onboarding time from two days to 30 minutes."
After implementation, the BA measures:
• Average onboarding time
• Error rate
• Customer satisfaction
• Staff productivity
• Processing costs
• Number of failed applications
If onboarding time falls from two days to 25 minutes, the solution achieved the target.
If onboarding time remains at two days, further investigation is required.
The BA therefore asks:
"Did the solution solve the original problem?"
9. The Business Analysis Core Concept Model
BABOK® uses the Business Analysis Core Concept Model, known as BACCM.
It contains six core concepts:
- Change
- Need
- Solution
- Stakeholder
- Value
- Context
A useful way to remember them is:
Need → Change → Solution → Value
within a particular Context and involving Stakeholders.
Change
Change is the transformation from an existing state to a future state.
Example:
Moving from manual invoice processing to automated invoice processing.
Need
A need represents a problem or opportunity requiring attention.
Example:
"Invoice processing takes too long."
Solution
A solution addresses a need.
Example:
An automated invoice management system.
Stakeholder
A stakeholder is a person or group involved in, affected by, or interested in the change.
Example:
• Customers
• Employees
• Managers
• Suppliers
• Regulators
• Developers
Value
Value represents the benefit, importance or worth delivered to stakeholders.
Example:
Automating invoices might produce:
• Lower processing costs
• Faster payments
• Fewer errors
• Better visibility
Context
Context represents the circumstances surrounding the change.
This includes:
• Organisation
• Culture
• Technology
• Regulations
• Market
• Processes
• Resources
A solution that works in one organisation might fail in another because the context differs.
10. Stakeholders
Stakeholders are central to business analysis.
Common project stakeholders include:
Sponsor
The sponsor supports the initiative, establishes goals and provides resources or funding.
Business Analyst
The BA investigates the business need, manages requirements and supports the definition of the solution.
Project Manager
The Project Manager focuses on delivery.
Typical areas include:
• Scope
• Budget
• Schedule
• Quality
• Risks
• Resources
Domain Subject Matter Expert
A Domain SME understands the business area.
For example, in a banking project, a compliance specialist might act as a Domain SME.
Implementation Subject Matter Expert
An Implementation SME understands how the solution will be implemented.
Examples include:
• Developer
• Solution Architect
• Database specialist
• Technical architect
Tester
The tester verifies whether the solution satisfies the defined requirements and quality expectations.
11. External Stakeholders
Not every stakeholder works inside the organisation.
External stakeholders might include:
• Customers
• Suppliers
• Government agencies
• Regulators
• Partners
• Investors
• External consultants
For example, a banking system might involve internal employees, customers, payment providers and financial regulators.
The BA needs to understand each stakeholder's interests and influence.
12. Requirements Classification
BABOK® divides requirements into four major categories.
1. Business Requirements
Business requirements explain why the organisation needs the change.
Example:
"Reduce customer onboarding time from two days to 30 minutes."
This describes the business objective.
2. Stakeholder Requirements
Stakeholder requirements describe what stakeholders need from the solution.
Example:
"Customer service staff need to view customer verification results within the onboarding screen."
This connects the business need to stakeholder needs.
3. Solution Requirements
Solution requirements describe what the solution needs to provide.
They include:
Functional requirements
and
Non-functional requirements.
Functional requirement
Describes what the system must do.
Example:
"The system shall send an email confirmation after successful registration."
Non-functional requirement
Describes qualities or characteristics of the solution.
Examples:
• Performance
• Security
• Reliability
• Usability
• Availability
• Scalability
Example:
"The system shall display the customer's dashboard within two seconds."
4. Transition Requirements
Transition requirements support the movement from the current state to the future state.
Examples include:
• Data migration
• Staff training
• User support
• System deployment
• Business continuity
• Temporary processes
For example, employees might need training before a new CRM system launches.
Training is therefore part of the transition requirements.
13. Requirements vs Design
This distinction is important.
A requirement describes a need or capability.
A design describes how the solution will satisfy the requirement.
Example:
Requirement:
"Customers need to reset their passwords without contacting customer support."
Design:
A password-reset screen using email verification and a temporary reset token.
The requirement describes what is needed.
The design describes how the solution addresses the need.
Requirements and designs often evolve together.
As the team develops the design, they might identify missing requirements.
As stakeholders refine their requirements, the design might also change.
14. A Simple Business Analysis Example
Let's bring everything together.
Imagine a company receives customer complaints because refunds take seven days.
Step 1: Identify the need
Customers want faster refunds.
Step 2: Understand the current state
The BA investigates the process.
They find:
• Customer requests refund.
• Customer service reviews request.
• Finance approves refund.
• Finance manually processes payment.
• Customer receives confirmation.
Average processing time: seven days.
Step 3: Identify stakeholders
The BA speaks to:
• Customers
• Customer service
• Finance
• Operations
• IT
• Compliance
Step 4: Define the business requirement
"Reduce average refund processing time from seven days to two days."
Step 5: Define stakeholder requirements
Finance needs an approval workflow.
Customer service needs visibility of refund status.
Customers need confirmation when the refund is processed.
Step 6: Define solution requirements
Functional:
"The system shall route refund requests to the appropriate finance approver."
Non-functional:
"The refund system shall maintain an audit trail of all approval actions."
Step 7: Define transition requirements
Staff need training.
Existing refund records need migration.
The new process needs a controlled rollout.
Step 8: Evaluate the solution
After implementation, the BA measures the results.
Average refund time:
Before: 7 days
After: 1.8 days
The solution has achieved the target.
15. What You Should Remember for Your Exam
Focus on these points:
Business analysis:
Identifies needs, problems and opportunities and helps define solutions that deliver value.
Six knowledge areas:
- Planning and Monitoring
- Elicitation and Collaboration
- Requirements Life Cycle Management
- Strategy Analysis
- Requirements Analysis and Design Definition
- Solution Evaluation
BACCM:
Change
Need
Solution
Stakeholder
Value
Context
Four requirement categories:
Business
Stakeholder
Solution
Transition
Solution requirements:
Functional
Non-functional
Key distinction:
Requirement = what is needed.
Design = how the need will be satisfied.
The BA's central question is:
"What business problem are we solving, who needs the change, what does the future state look like, and how will we know the solution delivered value?"
This is the foundation you need before moving into Business Analysis Planning and Monitoring.
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