Business Analysis Techniques and Examples

Antonette Dela Cruz, Rodney Michael
  • Author
    Antonette Dela Cruz

    Antonette Dela Cruz is a veteran teacher of Mathematics with 25 years of teaching experience. She has a bachelor’s degree in Chemical Engineering (cum laude) and a graduate degree in Business Administration (magna cum laude) from the University of the Philippines. She’s currently teaching Analysis of Functions and Trigonometry Honors at Volusia County Schools in Florida.

  • Instructor
    Rodney Michael

    Rodney has taught university accounting classes and has a doctorate in accounting.

Learn about business analysis techniques. Discover the steps and importance of effective business systems analysis and examine business analysis examples. Updated: 06/29/2022

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Business Analysis Definition

For any business to be thriving, there needs to be constant improvement by identifying needs and solutions to business problems at the onset they appear. Addressing this need prompts a company or business to create a business analysis project to identify efficient solutions that meet the demand for improvement. Business analysis is defined as the in-depth company study that does all these activities in addressing the mission set by the company. The business analysis team provides organization, strategic guidance, documentation, clarification, and assistance with political issues to the business.

It is important to understand that documentation is necessary when conducting a business analysis, and the company's stakeholders are essential. Stakeholders include everyone connected to the company's improvement plan, such as customers, external auditors, regulatory officials, and suppliers.

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Popular Business Analysis Techniques

Several business analysis techniques are popular in the business world. In all of these, documentation is essential throughout the analysis process. Four top strategies include brainstorming, SWOT, MOST, and PESTLE.

Brainstorming

Brainstorming is the oldest method of doing business analysis. It comprises forming groups of stakeholders of the company to focus on a problem and then discussing many ideas to fix it. This strategy encourages the stakeholders to be creative in developing new ideas that may be used to improve the business.

Brainstorming follows these basic steps:

  • Preparation — where the organizer and participants are identified and will set goals and criteria. They may also develop norms that the group will follow, such as a time limit for meetings and a clear definition of the problem or area of interest.
  • Discussion/session — where the stakeholders share ideas with the group without fear of criticism. The participants will be encouraged to generate as many ideas as possible within the period and motivated to be creative and open in sharing these ideas.
  • Wrap-up — when the time limit is reached, the ideas generated are discussed by the group and evaluated. Some ideas are merged and summarized into a shorter list.

The brainstorming technique can generate many ideas in a short time and an unbiased environment. However, much depends on the stakeholders' willingness to participate and creativity in formulating new ideas for improvement.

SWOT

The SWOT technique comprises four factors that are evaluated to find the company's strengths, weaknesses, opportunities, and threats:

  • Strengths — the factors that make the company better than its competitors. It is the identifiable advantage that a company has.
  • Weaknesses — the company's characteristics that put it in a disadvantageous position compared to its competitors.
  • Opportunities — the things happening in the environment that the company may use to its advantage.
  • Threats — things in the outside environment that could jeopardize the company's growth or improvement status.

MOST

The MOST technique is considered one of the best in understanding the company's goals and purpose. The strategy starts by detailing the missions and goals, each with suggestions on how to achieve them. MOST is also an acronym that stands for the following:

  • Mission — this tells the company's primary purpose.
  • Objectives — enumerates the critical goals that will help achieve the set mission of the company.
  • Strategies — options that are available for achieving the goals.
  • Tactics — the methods that the company will follow to implement the strategies.

PESTLE

PESTLE focuses on environmental factors that may affect a company's overall plans for growth and expansion. It covers all the external factors that may directly affect the company. These factors create the acronym:

  • Political — examples include government policies and financial subsidies and support. The company should also be aware of new laws that may affect the business.
  • Economical — understanding the business location's economy is crucial because it carries labor and energy costs, inflation, and interest rates.
  • Sociological — changing preference of the target market is influenced by changes in education, culture, media, and population.
  • Technological — changing technology such as software and equipment upgrades will affect the company's plans.
  • Legal — local and national government regulations and employment standards may affect the company's policies.
  • Environmental — the company is also affected by its stand on waste management, recycling, pollution, and weather management. For example, a hurricane-prone business in Florida will have a different safety plan compared to another company in tornado-prone areas in Texas.

All of these techniques are useful and important in helping the company come up with sound business analysis. It is also worth mentioning the importance of documentation for organized record-keeping and ease of data collection for future evaluation and assessment of the program.

Steps in Business Systems Analysis

There is a total of nine steps in the creation of business analysis. These are:

  1. Identifying the problem, issue, or some company need
  2. Designating an analysis team
  3. Identifying the current process
  4. Identifying stakeholders
  5. Identifying requirements
  6. Identifying current capabilities
  7. Identifying differences
  8. Identifying potential solutions
  9. Implementation of changes

Business Analysis Example

Case Example
Wheels on Us is a small motorcycle and motorbike dealership company. In addition to selling motorcycles and bikes, it does repairs and maintenance and sells riding gear and merchandise. The problem with the store is its inventory system. The customers and staff complain about its accuracy with merchandise showing in stock when none are available.
Steps to Perform a Business Analysis
STEP 1
Identify the problem.

The problem is the inventory system, which shows false information regarding merchandise availability.

STEP 2
Designate an analysis team.

The team's task is to be the go-between and provide organization, strategic guidance, documentation, and assistance with political issues. The identified problem or issue for this particular example is the inventory system. Therefore, the team that may be suitable to solve the problem comprises the business manager and their assistant.

STEP 3
Identify the current business process.

The business process in this example is the inventory system. The people directly connected to this process are the shop manager, the sales manager, and the accountant.

STEP 4
Identify the stakeholders.

Stakeholders are directly affected by the problem or issue. This may include customers, suppliers, regulatory officials, financial reporting experts, and external auditors. In this case, the company owner, customers, and salespeople are affected.

STEP 5
Identify requirements.

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Frequently Asked Questions

What are business analysis techniques?

Business analysis techniques are strategies or ways where the company can improve its performance. Among the most popular ones are brainstorming, SWOT, MOST, and PESTLE.

How do you write a business analysis?

There are 8 steps that are done to make a business analysis. The steps are:

  1. Identify the problem or issue;
  2. Designate the analysis team (which will provide organization, guidance, documentation, clarification, and political assistance);
  3. Identify the current process;
  4. Identify stakeholders (e.g. regulatory officials, suppliers, customers, external auditors);
  5. Identify requirements (including brainstorming, interviews, and review of documentation);
  6. Identify current capabilities;
  7. Identify differences;
  8. Identify potential solutions;
  9. Implement changes.

What does a business analyst do?

The business analysts who provide organization, strategic guidance, documentation, clarification, and assistance with political issues to the business are the ones that initiate the problem-solving process for the company. They find the strategy or technique that would solve the problem and document the process so that the improvements can be shared with all stakeholders.

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