Business analysis (BA) is defined as the "set of tasks and techniques used to work as a liaison among stakeholders in order to understand the structure, policies, and operations of an organization, and to recommend solutions that enable the organization to achieve its goals " (as defined in the IIBA Business Analysis Body of Knowledge® Guide, Version 2.0).
We see Business Analysis as a Service (BAaaS) combining three (potential) trends. First and foremost, BAs are gaining an increasing strategic role, especially within large organizations. Second, increasing service orientation within organizations to offer, deliver and manage its business and IT functions and, finally, the emerging opportunities for CIOs to strategically source operational BA services. In this article we discuss these trends and focus on the emerging BA management models, i.e. how the organization wants the BA services to be arranged internally and sourced externally.
The Three BA Trends
The first trend is that the business analysis discipline is gaining a more strategic role in organisations. BAs act as the focal point for key organisational knowledge about business processes and IT systems. With many CIOs trying to reposition themselves as Business Process Managers rather than just caretakers of the IT Infrastructure, BA capabilities have become vital assets, especially for organisations with complex business processes and broad portfolio of IT applications. Hence, managers are trying to re-position BAs as innovators who can make use of technology to improve business performance, rather than just being involved in traditional software development and infrastructure management activities. As compared to just being translators between business and IT, BAs are now acting as architects of the business. According to a study 56% of Business Architects / Business Consultants are erstwhile BAs .
Based on our interactions with Senior IT executives and Industry Analysts few significant pain points which are hindering effectiveness and efficiency of BAs are:
- Lack of analytical frameworks as well as sufficient skill-sets to understand the business needs and turn them into improvement projects. Currently, these projects are usually driven by more technical IT professionals.
- With a high BA turnover, (sometimes due to the large number of BAs working as contractors) there is much less bandwidth spent on knowledge building and retention.
- Lack of thought leadership and collaboration between the different BAs within an organization as well as between BAs and the other stakeholders
- Lack of understanding and usage of the appropriate BA methods and tools and industry best practices.
These deficiencies lead to lower productivity, high cost for projects and sometimes may also lead to lack of motivation amongst the BA staff. They also comes with a very high opportunity costs which organisations have recently started to realise.
Secondly, service orientation is gaining importance in both the internal and external way of thinking about value creation, organizational arrangements, and business-IT alignment.
On one hand, enterprises continuously strive to offer their services in a manner which aligns with satisfying their customer's needs, while on the other hand the internal organisational structures are also evolving in the form of loosely coupled "soup of services" (as compared to traditional 'department' oriented structures) to increase responsiveness, better performance management and increased accountability. Consider this, apart from re-organising services in a more citizen-centric manner, (Service Canada, DirectGov -UK, Smart Services Queensland) governments are also undergoing large scale re-organisations in IT departments (and shared service agencies as a whole). Some time back, a large state government enterprise in Australia began its journey developing a sustainable internal capability development for the provision of BA services to projects and business units. In another case, a large Australian Bank recently formulated its BA practice strategy with an aim to be the "supplier of choice" and a "Centre of Excellence" for its internal customers. Both these cases highlight the degree of service orientation organizations are bringing into their BA management strategy.
The third notable trend is in the area of (global) sourcing. project managers/BA managers are faced with a Hobson's choice of either pursuing the traditional model of high cost contractor -based sourcing of skills, or developing permanent staff. The latter implies loosing flexibility of quickly ramping up and ramping down teams on an ad hoc, need-driven basis. This issue is exacerbated in the case of BAs since most of the BA work happens in-house unlike Design & Development which can be largely outsourced. Hence more and more organisations now want their large IT services vendors to "partner" with them in BA space rather than just providing generic, professional/ augmentation like services. Last year's survey by Mckinsey & Co. on IT outsourcing clearly stated that managed service models lead to higher customer satisfaction, and this is applicable to BA services as well. It is notable that bringing in an external partner also sometimes aids innovation in business processes and technology, since often it is difficult to "insource" innovative thinking.
Emerging Models: BA Services
Deloitte suggests that next wave of competitive advantage will accrue to organizations that can effectively apply the shared model to business advisory services as well4. Now that the worst is behind us in the global financial crisis the leaders look up to build internal capabilities in variety of areas.
We believe that the three trends, illustrated above, and renewed eagerness amongst the leaders to build and nurture internal capabilities will contribute immensely to an increase in shared advisory/shared services group for the BA community. Trends already suggest an increase in service orientation amongst the BA communities, especially the emergence of BA Centres of Excellence (BACoE) in large organisations. Sometimes these capability centers may be termed BA Competency centre, BA Solution centre, BA Shared service centre and so on. These centers are expected to be centralized bodies (physical or a virtual organisation) of professionals with a charter of providing professional BA skills to various internal customers (projects). This group has good subject matter and technology expertise to be able to provide services around Requirements Engineering, Process Management, Data Management, Product Evaluation, Business Case Preparation, Business Architecture and many more. Establishing a central function has in the past helped organisations to foster collaboration and innovation within the BA community.
Our experience suggests that one of the critical success factors for such groups is the amount of "Service Rigor" (service oriented strategies) provided to its customers. However, most of the time, the focus has been just on providing staff trainings, skill assessments, creation of knowledge repositories, methodologies, etc. Often the CoE is too internally focused and reduced to being a collection of repositories on a web-portal or a forum for regular BA meetings.
Figure 2: Illustrative BACoE model with vendor partnership
This also enables the internal capabilities of the CoE for example; trainings, methodologies, tools and templates to be directly aligned, according to the needs and demands of the service provided.
For example, Infosys has been investing in creation of BACoE through a unique partnership model between its Business Units, Education & Research division and their R&D arm SETLabs. Apart from Training, Collaboration and best practices creation, this model has been successfully used to create a suite of BA service offerings for its customers.
When the Infosys BACoE decided to launch its "Requirement Development" service offering it was well supported by the proprietary tool and methodology called "InFlux" for developing use cases. All the BAs involved in provisioning this service to clients were trained experts in this methodology.
Inarguably, having such a service-oriented strategy for internal customers (Business Units) as well as a provider of BA services (IT department) can deliver outcomes that can enhance efficiency, quality and productivity; in IT as well as non IT initiatives. Based on our experience we prescribe the following considerations for the CIOs while creating such a service-oriented structure:
- Clearly identify and define the services which are easier to understand, support and deliver. This may sound easy but experience suggests that it is the most challenging task for the BA community
- Establish well-defined SLAs with measurable outcomes/deliverables and an overall promise of service. Clearly associate performance measures with each of these identified BA services
- Establish a framework to manage a portfolio of these BA services. This includes appointment of Service Managers, Service Performance Management, Periodic Service Upgrades and so on.
- Create a well-defined sourcing strategy for these services.
Engaging an IT vendor or a consulting partner, who comes onboard with basic practices, processes and guidelines, can accelerate the development as well as the maturing of such a function. There are many instances where organisations have set up a joint shared services model with their vendors to achieve flexibility, scale and demand of business with good service level performance at a lower total cost. Such partnerships also help to free up in-house BAs, allowing them to focus more on innovation and value creation for the business.
While most of the firms currently operating in the market are either specific tool vendors or BA training providers it is notable that only a few vendors possess the integrated capabilities of providing BA services that provide a strong value preposition across multiple service areas and innovative financial schemes, e.g. outcome based pricing.
Service orientation within BA organisations or in other words Business-Analysis-as-a-Service (BAaaS) presents a lot of promise for the CIOs and senior managers. A well developed model for the BA as a Service that addresses the value proposition, the strategic alignment, the organizational configuration and the financial scheme (revenue, investment, KPI) can works as a catalyst for innovation, enhancing workforce effectiveness and reducing enterprise costs.
- Forrester Research - The Up-And-Coming Business Architect by Jeff Scott and Katie Smillie for Enterprise Architecture Professionals
- McKinsey Quarterly - How Innovators are changing IT offshoring - Michael Bloch, Dejan Boskovic, and Allen Weinberg
- Hewlett Packard - Business Analysis Centre of Excellence: The Cornerstone of Business Transformation by Kathleen B. Hass, With Richard Avery, Terry Longo, and Alice Zavala
- Deloitte LLP - Sharing internal expertise making shared advisory capabilities work
- Infosys in-house research artifacts.
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Rohit Shawarikar (BE, MBA) is a Consultant with Software Engineering and Technology Labs, Infosys Technologies Limited. He has significant consulting experience across Banking, Telecom and Industrial sectors in the area of IT Requirements Development, Business Process Improvements and Technology Product Implementation initiatives. Rohit is also responsible for evangelizing IP based BA service offerings to customers in Australia Region. He has successfully managed the creation and global roll out of Business Analysis Center of Excellence (BACoE) for Infosys.
Erwin Fielt (MSc, PhD) is a senior researcher at the Information Systems Discipline of Faculty of Science and Technology of the Queensland University of Technology, Brisbane, Australia. In his research, he focuses on the intersection between business and IT, where information systems have to create value for individuals and organizations addressing topics like success, strategy, business models, service-orientation and architecture. Erwin participates as a Postdoctoral Research Fellow in the Business Service Management project of the Smart Services CRC. Within this project, he is responsible for the business model research and he works closely with different industry partners like Queensland Government, Suncorp and Infosys.