Data drive today’s businesses. Businesses have to deal with enormous amounts of data for both consumers and businesses to experience growth.
However, generating data is only the start—to get the best results, businesses should know how to use the data they generate. Unfortunately, about 40% of company reports don’t bring much value to a business.
To benefit from this data, companies should employ the best business analysis techniques to analyze and identify their needs and look into enormous amounts of data to develop the best solution for the business.
Businesses can use many different business analysis techniques to their advantage. These techniques work differently to bring results in different specific situations.
This article examines business analysis techniques businesses use to execute growth strategies. But before that, let’s look at what business analysis is.
What is Business Analysis?
Business analysis is a research discipline that companies use to identify problems and create practical solutions to address them. It includes different actions aimed at improving the business, including strategic planning, policy development, software, and methods.
The primary reason for business analysis is to identify the best practical solution to a problem. When applied correctly, business analysis can give you an edge against competitors and ensure your business operations run smoothly.
- Many benefits come with effective business analysis, including:
- Reduced costs
- Increased ROI
- Effective team collaboration
- High success rate
- Increase in sales
Now that you know how business analysis can benefit your business, let’s look at the top business analysis techniques:
No, it’s not SWAT, or is it related to a special military unit. SWOT is the short form for Strengths, Weaknesses, Opportunities, and Threats.
It is one of the unique business analysis techniques that help analyze a company’s internal structural factors like strengths and weaknesses and external factors such as threats and opportunities.
- Strength: This refers to the company’s actions that help solve problems and bring key advantages to a company. This includes the company name, location, great reputation, trusted employees, brand name, great customer support, etc.
- Weaknesses: These are activities or policies that derail a company’s growth. Examples include department rivalry, low-quality product, lazy and non-trusted employees, bad reputation, etc.
- Opportunities: These are external factors that can benefit the company and give it an advantage over competitors.
- Threats: These are external factors that derail the success and growth of the company. Examples include new technology such as AI and IoT, new regulations, changes in market research and trends, etc.
SWOT provides a great way to understand a company’s competitive position and how it’s doing against its competitors.
It is an excellent way to understand a business’s weaknesses and strengths since its data is not biased.
Another SWOT advantage is that it helps businesses create long-term plans and choose the best time to pursue new growth opportunities.
Coca-Cola is one of the companies that use SWOT business analysis techniques to grow their business.
Regarding strengths, Coca-Cola has products across different categories, a powerful brand recognition, and a 43 percent market share in the soft drink industry.
Some of the weaknesses are that the company is yet to find a good substitute for sugar and challenges in keeping up with the changing health demands.
The company has a great market growth opportunity if it can keep up with the current health trends. Again, Coca-Cola has few actual competitors currently.
The company also faces threats due to negative press and media coverage and the fact there are alternative health substitutes to soda, like iced or hot tea, Arnold Palmer Lite, Maple water, etc.
Business Process Modeling (BPM) Analysis
Business Process Modeling gives business analysts end-to-end views of the business lifecycle. This technique is crucial during the business analysis phase—it helps evaluate the gaps between the existing and future business processes of the company.
A company’s process model will include a graphical representation of its workflow and the related sub-processes.
The result is comprehensive, quantitative activity diagrams and flowcharts with vital insights into how a specific process should function. These includes:
- Events associated with a workflow
- The person who will initiate these events and activities
- The paths workflows will take based on their outcomes
- Devices needed in the process
- The timelines
- The success or failure probability of the process and the challenges that the business is likely to face
Business Process Modeling involves four steps:
- Planning and organization
- Analyzing the business model
- Designing and defining the process
- Technical analysis for complex business solutions
Many industries use this technique, including the IT industry. With this business analysis technique, businesses can get insights into the impacts of the different roles in a business process.
Here are some examples of the business process modeling technique:
- Gantt Charts: This BPM technique is named after Henry Gantt, an American mechanical engineer. This technique visualizes business processes, including task duration, dependencies, task interdependence, and key milestones. Gantt charts are ideal for businesses with time-sensitive processes.
- Flowcharts: This process involves a graphic presentation of how different processes or steps can progress to reach a specific outcome.
- Business Process Modeling Notation (BPMN): This technique is designed for modeling, and many consider it the standard for business process modeling. It includes a visual representation of objects or standardized symbols for various workflows in a business process.
MOST is another business analysis technique that businesses use to improve their growth. This technique helps business analysts analyze an internal company’s goals and strategies to achieve them.
MOST is the short form of Mission, Objective, Strategy, and Tactics. Here is what each of these factors means:
- Mission: This is a crucial factor in business growth. It refers to the purpose or future goals a company plans to achieve. As usual, the mission should be unique and specific.
- Objectives: Objectives refer to the key goals aimed at helping a company achieve its mission. A company’s objectives must be specific, measurable, achievable, realistic, and timely (SMART).
- Strategy: This is a group of steps and actions an organization takes to achieve its objectives and, ultimately, its mission. A business analyst should ensure that the company has developed the best strategy to achieve its objectives.
- Tactics: These are straightforward strategies a company will use to achieve its strategies
Business analysts use the MOST technique to analyze the activities of a company and how it plans to achieve its goals.
Thus, the primary benefit of this analysis is that it helps understand a company’s ability and purpose to ensure that the company retains its focus, which is a key factor for the success of an organization.
Many external factors affect the performance of an organization. Business analysts use the PESTLE analysis technique to analyze these factors and find the best ways to address them.
Pestle analysis, also known as PEST, is one of the best analysis techniques for environmental surveys. PESTLE is an acronym that stands for various factors which influence the decision that an organization makes. Here are these factors:
- Politics: This includes government policies and initiatives, financial support, and subsidies
- Economic: Labor, energy costs, inflation, and interest rates
- Social: Lifestyle, culture, media, education, population, etc.
- Technology: Innovations, new communication systems, new information, and automation
- Legal: Government regulations, employment standards, copyright/patent laws, health and insurance laws, privacy laws, discrimination laws, etc.
- Environment: Factors include weather, climate change, global warming, pollution, recycling, waste, etc. These factors affect various industries such as farming, tourism, insurance, etc.
Those are the main factors that impact the PESTLE parameters.
This technique helps business analysts identify environmental factors within which a business operates and how they impact the company’s future operations.
This technique is crucial when planning the right time and methods to introduce a new product or service. A business analyst uses this technique to assess the threats and opportunities a business is likely to face.
Additionally, PESTLE analysis helps evaluate the internal and external environments in which a business operates. It offers insights into legal, environmental, political, competitive, economic, and social aspects that influence the company’s working environment.
When done right, PESTLE analysis can help businesses reduce potential threats and open doors to exploit opportunities for entering new markets.
This technique analyzes business problems and identifies the best solutions to what the company is trying to achieve and how these solutions will impact the company and its stakeholders.
CATWOE is an acronym that stands for Clients/customers, Actors, Transformation, Worldview, Owner, and Environmental constraints.
- Customers: Who benefits from the business’s efforts and output, and how will the issue impact them?
- Actors: These are people involved in the business processes, like employees who handle various business activities
- Transformation process: What is the business’s main system activity? In other words, what’s the core transformation that converts input into output?
- Worldview: What’s the stakeholders’ view of the organization? It provides the big picture of the business and what it is supposed to achieve.
- Owners: Who is in charge of the impacted business, and how has the problem impacted them? In other words, who is mandated to make the changes?
- Environmental Constraints: These are external limitations that impact the growth of the organization
The primary benefit of CATWOE analysis is that it brings stakeholders’ perspectives into one platform. This allows for a holistic approach regarding the integrity of the data, assumption, ethical angle, etc.
Business analysts should apply CATWOE analysis at the start of the project or during the planning phase for better results.
Non-Functional Requirement Analysis
Business analysts will use this technique when a technological solution is altered. This can be when a technology is changed, replaced, or migrated, and a new technology needs to be built from scratch.
During this analysis, analysts prioritize system performance and data storage to measure performance factors of the proposed new live data system.
Business analysts conduct non-functional requirement analysis during the project’s analysis phase and implement it in the design phase. This analysis tests different factors, including:
This important business analysis technique helps a business achieve the intended results.
Six Thinking Hats
This technique is a robust problem-solving or decision-making approach that businesses use.
The Six Thinking Hats has several points of view and is based on the fact that different people think differently and develop ideas based on their personalities.
By applying this technique, a company looks at a problem from six different points of view, which presents a wide range of possible solutions.
This technique aims to get many possibilities—you and your team should go beyond your positions and focus on the outcomes when providing your ideas.
Here are the six hats that make up the Six Thinking Hats Technique:
- Green hat: Also known as the creative hat, this hat presents creative thinking and brainstorming. Analysts use this hat to explore new possibilities and ideas for a problem.
- White hat: When wearing this hat, you focus on an analytical perspective based on facts and logic. It involves collecting information and carefully analyzing the knowledge and insights you already have and information you’re missing, and where you can find it.
- Black hat: Also referred to as the judge’s hat, black hat focuses on risk assessment and caution. It involves critical thinking and assessing why you have concerns about possible negative outcomes.
- Red hat: This involves gut reactions based on feelings and instincts. Red hat allows people to express their feelings without proving them logically.
- Yellow hat: This hat is also called the optimist’s hat. It represents an optimistic perspective—when you wear this hat, you focus on positive outcomes that could come from your ideas and the best-case scenarios.
- Blue hat: This hat is also known as the “hat of control.” In this mode, you focus on structured thinking with an agenda to control the situation and reach conclusions.
One of the benefits of Six Thinking Hats is that it allows for more organized thinking. Businesses use this technique to analyze the information collected efficiently and effectively for better decision-making.
This analysis technique also allows for improved creativity. Instead of you and your team thinking based on your positions, you combine different perspectives to create more creative ideas.
Each of these hats has many benefits to a business or organization.
The bottom line is that wearing each of these hats helps gain a deeper understanding of the issues at hand and better decision-making from different perspectives.
According to Merriam-Webster, brainstorming is a group solution-finding technique that involves idea contributions from all group members.
Although it may seem outdated, this technique encourages idea contribution from members no matter how outside the box it may seem, making it a valuable business analysis technique.
Brainstorming analysis involves focusing on a problem and developing many possible solutions.
The technique is more applicable in groups because it encourages the experience and creativity of the participants to get different unique possible solutions.
The Brainstorming analysis technique involves three stages:
- Wrap up
Preparation involves defining an area of interest and then determining the time limit. It also involves identifying participants and establishing the evaluation criteria.
On the other hand, the session stage involves allowing the group members to share ideas, record them, and build on each other’s ideas.
Lastly, the wrap-up stage involves discussing and evaluating ideas, creating a list, rating them, and distributing the final list.
Brainstorming analysis technique is a great way to develop different unique ideas for your business regardless of the industry.
The fact that it involves all group members provides a great platform to identify the root cause of problems in an organization and possible solutions, which helps create an effective team problem-solving approach.
This analysis is also called a linear-sequential life cycle model. The Waterfall Model is divided into phases; analysts must complete each of them before they can go to the next one.
In addition, due to its sequential nature, analysts cannot return to the previous step. As such, they need to be careful not to make any mistakes that can impact the final project outcome.
Common stages of Waterfall Model analysis include:
- Requirements gathering and analysis
- System design
The benefits of the Waterfall Model to business include:
- Easy to understand and use
- Model phases are completed on time
- Each phase has specific deliverables and a review process, which makes it easy to manage
It’s, however, crucial to understand that the Waterfall Model involves less customer interaction in product development. This technique is ideal for smaller projects with clearly defined requirements.
The 5 Whys
Dealing with stubborn and recurring problems in an organization is a sign of a deeper issue. The problem with many companies is that they focus on quick fixes whenever a problem arises.
However, this doesn’t provide the best solution, and more than sooner, the problem will reoccur, leading to time-and-resources wastage. This is where the 5 Whys technique comes into play to help determine the root cause of the problem.
This analysis technique was introduced in the 1930s by Sakichi Toyoda, the founder of Toyota industries.
The 5 Whys technique is a practical model that aims to understand why something is happening rather than what the team thinks the problem might be.
Using this technique means getting information from people with first-hand experience with the problem in question.
Ideally, with this technique, when a problem arises in an organization, you ask the question “Why” five times to determine the root cause.
This technique promotes critical thinking regarding a problem to get a broader picture of the cause and the best solution.
Business analysts use the 5 Whys for troubleshooting, solution finding, and quality improvement. You may want to apply this technique when solving simple and less complex problems.
These are the business analysis techniques that business analysts use to execute business growth strategies. They offer insights into how different internal and external factors affect the growth of a business and the steps to take to overcome those challenges.
Whether you want a better understanding of your target customer segment, business process, market, competitors, and government policies, conducting a business analysis is the way to go.