Business knowledge is required for the business analyst to perform effectively within their business, industry, organization, solution, and methodology. Business knowledge enables the business analyst to better understand the overarching concepts that govern the structure, benefits, and value of the situation as it relates to a change or a need.
Business Knowledge underlying competencies include:
- Business Acumen (p. 199),
- Industry Knowledge (p. 200),
- Organization Knowledge (p. 201),
- Solution Knowledge (p. 202), and
- Methodology Knowledge (p. 202).
9.3.1 Business Acumen
.1 Purpose
Business analysis requires an understanding of fundamental business principles and best practices in order to ensure they are considered as solutions are reviewed.
.2 Description
Business acumen is the ability to understand business needs using experience and knowledge obtained from other situations. Organizations frequently share similar practices, such as legal and regulatory requirements, finance, logistics, sales, marketing, supply chain management, human resources, and technology.
Business acumen is the ability to understand and apply the knowledge based on these commonalities within differing situations.
Understanding how other organizations have solved challenges may be useful when seeking possible solutions. Being aware of the experiences or challenges encountered in the past may assist a business analyst in determining which information may be applicable to the current situation. Factors that may cause differences in practices can include industry, location, size of organization, culture, and the maturity of the organization.
.3 Effectiveness Measures
Measures of effective business acumen include:
- demonstrating the ability to recognize potential limitations and opportunities,
- demonstrating the ability to recognize when changes to a situation may require a change in the direction of an initiative or effort,
- understanding the risks involved and the ability to make decisions on managing risks,
- demonstrating the ability to recognize an opportunity to decrease expenses and increase profits, and
- understanding the options available to address emerging changes in the situation.
9.3.2 Industry Knowledge
.1 Purpose
Industry knowledge provides the business analyst with an understanding of current practices and activities within an industry, and similar processes across industries.
.2 Description
Industry knowledge is an understanding of:
- current trends,
- market forces,
- market drivers,
- key processes,
- services,
- products,
- definitions,
- customer segments,
- suppliers,
- practices,
- regulations, and
- other factors that impact or are impacted by the industry and related industries.
Industry knowledge is also an understanding of how a company is positioned within an industry, and its impacts and dependencies, in regards to the market and human resources.
When developing knowledge about a particular industry, competitor, or company the following set of questions can provide guidance:
- Who are the top leaders in the industry?
- Which organizations promote or regulate the industry?
- What are the benefits of being involved with these organizations?
- Who is creating publicity releases, participating in conventions, and delivering marketing materials?
- What are the comparisons of products and services?
- What are the satisfaction indicators/benchmarking projects that are applicable?
- What are the suppliers, practices, equipment and tools used by each company, and why do they use them?
- What are the potential impacts of weather, political unrest, or natural disasters?
- Who are the target customers and are they the same for the competition?
- What impacts the seasonal cycles for production, marketing, and sales? Does it impact staffing or require changes in processes?
.3 Effectiveness Measures
Measures of effective industry knowledge include:
- being aware of activities within both the enterprise and the broader industry,
- having knowledge of major competitors and partners,
- the ability to identify key trends shaping the industry,
- being familiar with the largest customer segments,
- having knowledge of common products and product types,
- being knowledgeable of sources of information about the industry, including relevant trade organizations or journals,
- understanding of industry specific terms, standards, processes and methodologies, and
- understanding of the industry regulatory environment.
9.3.3 Organization Knowledge
.1 Purpose
Organization knowledge provides an understanding of the management structure and business architecture of the enterprise.
.2 Definition
Organization knowledge includes an understanding of how the enterprise generates profits, accomplishes its goals, its organizational structure, the relationships that exist between business units, and the persons who occupy key stakeholder positions. Organization knowledge also includes understanding the organization’s formal and informal communication channels as well as an awareness of the internal politics that influence decision making.
.3 Effectiveness Measures
Measures of effective organization knowledge include:
- the ability to act according to informal and formal communications and authority channels,
- understanding of terminology or jargon used in the organization,
- understanding of the products or services offered by the organization,
- the ability to identify subject matter experts (SMEs) in the organization, and
- the ability to navigate organizational relationships and politics.
9.3.4 Solution Knowledge
.1 Purpose
Solution knowledge allows business analysts to leverage their understanding of existing departments, environments, or technology to efficiently identify the most effective means of implementing a change.
.2 Definition
When the business analysis effort involves improving an existing solution, business analysts apply knowledge and experience from the previous work on the solution. Familiarity with the range of commercially available solutions or suppliers can assist with the identification of possible alternatives. The business analyst may leverage knowledge gained from prior experiences to expedite the discovery of potential changes through elicitation or in-depth analysis.
.3 Effectiveness Measures
Measures of effective solution knowledge include:
- reduced time or cost to implement a required change,
- shortened time on requirements analysis and/or solution design,
- understanding when a larger change is, or is not, justified based on business benefit, and
- understanding how additional capabilities that are present, but not currently used, can be deployed to provide value.
9.3.5 Methodology Knowledge
.1 Purpose
Understanding the methodologies used by the organization provides the business analyst with information regarding context, dependencies, opportunities, and constraints used when developing a business analysis approach.
.2 Description
Methodologies determine the timing (big steps or small increments), the approach, the role of those involved, the accepted risk level, and other aspects of how a change is approached and managed. Organizations adopt or create their own methodologies to fit varying levels of culture, maturity, adaptability, risk, uncertainty, and governance.
Knowledge regarding a variety of methodologies allows the business analyst to quickly adapt to, and perform in, new environments.
.3 Effectiveness Measures
Measures of effective methodology knowledge include:
- the ability to adapt to changes in methodologies,
- the willingness to use or learn a new methodology,
- the successful integration of business analysis tasks and techniques to support the current methodology,
- familiarity with the terms, tools, and techniques prescribed by a methodology, and
- the ability to play multiple roles within activities prescribed by a methodology.
