Business Knowledge for Business Analysts

  Business Knowledge
 Finance and Economy
The universal language of business is finance. A business analyst needs to have a good working knowledge of the economy and of the basics of business finance. It includes a general understanding of financial reports such as balance sheet, profit-and -loss account, financial analysis tools such as ratio analysis and principles of costing.

 Business Case Development
Much of analyst’s work will be to assess the costs and benefits of delivering a project    to the organization .When communicating analysis findings; you need to ensure that you have a view of the financial impact   on the project. IT is an enabling tool for the business benefits to be achieved. Business analysis projects involve other specialist like management accountants to understand and model the business activities and determine how IT can deliver financial benefit. To develop business case, a basic understanding of finance is required along with financial workings business area. Business analysts involved in business case preparation has to understand basic investment appraisal techniques and work closely with finance department.
              
 Domain Knowledge
 It gives general understanding of a business domain. Apart from general domain, specific domain knowledge is required for the following reasons;

• It enables you to talk sensibly with the business people involved in the project, in a language that they can understand.
• It helps you to understand what would and would not acceptable or useful in the business domain.
• It may enable you take ideas.

• Subject Matter Expert

 It takes domain knowledge to a lower level of detail. The level of expertise depends on the type of work being done. Business analysts may be specialist in particular domain ,with a strong and detailed understanding of the subject area, can pinpoint  areas for improvement , development and identify what needs to change, to analyze using  existing knowledge and contact. The key point is to assess how well competencies meet the needs of the current situation and to recognize where competencies needs some improvements.
                  
 Principle of IT
Many business analysts do not have an IT background. However, many business analysis projects result in the use of IT in some or the other way. General understanding of the field is necessary for a business analyst so that he can communicate meaningfully with IT professionals .The key requirement is that business analyst must understand the technical terms used by IT specialist. Since IT solutions are often investigated by business analyst, the latter should have an understanding of IT fundamentals, including areas such as

• How computers work, including operating systems, application software, hardware and networks.
• System –development  lifecycle
• System – development approaches
• The Relative pros and cons of developing systems and buying system  “off the shelf’;
• Trends and new opportunities that IT brings, such as ecommerce, grid computing and mobile technologies and how these impact systems development.

Organization Structure and Design
Business analysis projects involve restructuring organization to a greater or a lesser degree, to improve the customer service. It is important for business analysts to have a good understanding of the various organization structures   that may be encountered - function, project, and matrix and so on – and of their relative strength and weakness.

 Procurement
Most organization use external suppliers to deliver their IT systems. Selecting an appropriate sourcing strategy involves assessing the work and deciding the most appropriate way to take the project forward on sound commercial term. Once the analyst has worked out the type  that is required , they need to assess the most appropriate  supplier – internal and external- to take work forward and what commercial terms has to employed. A business analyst needs a broad understanding of contractual arrangements that is shown below:

• Time and Materials: where the contracted party is paid on the basis of the time worked.

• Fixed –price delivery: where the contracted party is paid the price that originally agreed for the delivery of a piece of work according to the precise specification.
• Risk and reward: where  the contracted party has agreed  to bear some  or  all of the risk of the project ,for  example by investing  resources such as  staff time , materials  or office space, but where potential rewards  are greater than under other contractual arrangements.

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