How to Become a Business Analyst – Complete Career Guide
A business analyst (also known as a management analyst) is in charge of understanding a business’s continuously evolving needs while providing technological solutions to improve its processes and systems. In this way, a business analyst is often thought of as the link between the business and IT departments.
Historically, companies began to convert paper-based processes into automated, electronic processes in the 1970s and 1980s with the advent of computers. Business analysts entered the scene in the 1980s and 1990s to pair this new technology with business acumen. However, technology is continuing to change this role. Recent advances in big data mean that the role of the business analyst has evolved a great deal. Today, business analysts (alongside other roles in data science) are able to mine big data to understand customer behavior and identify system inefficiencies, for example.
This guide provides the steps necessary to becoming a business analyst, detailed job information, as well as the job prospects and average salary projections.
What is a Business Analyst?
Business analysts work within an organization to evaluate current systems and develop strategic plans. This requires deep knowledge of both the specific business as well as industry trends and conventions. A key aspect of the business analyst role is communicating plans between internal departments and external stakeholders.
The International Institute of Business Analysts (IIBA) consider business analysts to be agents of change, and thus a primary role of the business analyst is to introduce change in an organization. These changes might be high-level, such as larger scale structural or policy changes or they might be more granular such as finding opportunities for cutting costs. Either way, the changes introduced by a business analyst should help an organization find and realize new opportunities.
Business analysts will also develop or update computer systems to solve their business needs. The business analyst provides requirements to the IT department to produce this new technological system and also supports the testing and implementation of the system.
What does a Business Analyst Do?
A business analyst scrutinizes sets of data looking for ways to increase efficiency in an organization. In this way, the business analyst often acts as a liaison between different departments in a company, finding ways to streamline processes throughout the organization. The business analyst must be able to communicate well within these different organizational groups, sometimes acting as diplomat, presenting solutions in ways that colleagues and stakeholders will understand and appreciate.
Business analysts engage in four main types of analysis:
- Strategic planning—identifying changing needs of a company
- Business model analysis—defining policies and market approaches
- Process design—standardizing workflows
- Systems analysis—interpretation of requirements for the IT department
Business analysts might deliver many different types of solutions in many different formats, including business plans, data models, flowcharts, or strategic plans.
The Three Steps to Launching a Business Analyst Career
Step 1: Get an Undergraduate Degree in Business Administration, Finance, or Accounting
Beyond your bachelor’s degree in business, you’ll want to learn some computer programming. Different business analyst roles require different levels of technical proficiency, but the better developed your programming skills, the better you will look as a candidate. The IIBA’s Business Analysis Body of Knowledge (BABOK) reference book is a key resource to begin understanding the tasks and techniques of a business analyst.
Step 2: Gain Work Experience
You can gain experience in a volunteer role with a small company first or take advantage of summer internship opportunities. If you are already working with a company in a different role, offer to work on the kind of projects that business analysts undertake.
There are many transferable skills to working as a business analyst, since it is a role that is considerably wide-ranging. Individuals can enter the field either with knowledge of a specific business domain, such as workflow, billing, or customer relations, or with knowledge of an industry at large, such as finance, telecommunications, or government. Once you are hired as an entry-level business analyst, make sure to gain experience by working on as many varieties of projects as you can; later, you can specialize in the domain or industry you are particularly interested in and that experience may help you discover what that industry is.
Step 3: Earn a Master’s Degree or Obtain an Advanced Certificate
Many universities offer master’s degrees and graduate certificates in business analytics, which generally include courses in business data analytics, operations research, project management, database analytics, and predictive analytics. For those with advanced knowledge of business analytics, the IIBA offers a professional certificate called the Certified Business Analysis Professional as well as a variety of other more specialized certifications that may fit the specific career path that you had in mind.
Business Analyst Job Description
Though there are many different aspects to the role, business analysts generally follow a pattern of gathering research, presenting solutions, and then implementing these solutions in the form of new or adapted technology. In the process, a business analyst might be required to do the following:
- Communicate with colleagues to understand the needs of the business
- Work with stakeholders to understand the service or product provided
- Conduct surveys, workshops, and tests
- Analyze and model data to produce conclusions
- Create suggestions and solutions for strategic and operational changes
- Consider the opportunities and risks of these suggestions
- Invent systems or processes necessary to implement these changes, or alter existing systems that already exist
- Communicate with senior management about introducing recommendations to the business
- Write reports to present to stakeholders
- Support staff as solutions are implemented
- Evaluate impact of changes made
Skills Needed to Become a Business Analyst
Business analysts need to have a combination of hard and soft skills. These include:
- Communication skills: Business analysts must work in groups, collecting sometimes dense, technical information and presenting it to wide-ranging stakeholders in the company. They’ll have to translate and negotiate between parties and communicate their solutions in an accessible way. Thus, business analysts must have strong written and spoken skills and feel confident in a leadership position to gain approval for plans from superiors in the company.
- Business knowledge and critical thinking: Business analysts must understand many facets of the company they are working with. They must be able to apprehend the roles of different individuals and departments, and how these departments interact and depend upon each other. They must also be able to comprehend the single organization in a broader context of the entire industry. This business knowledge will then allow them to successfully analyze data points and build strategic plans for the future.
- Technical skills: Business analysts may use a wide range of technical programs, including programs in diagramming, data crunching, wireframing, management of requirements, and for presentation of results. More and more, business analysts are increasing their technical proficiency with knowledge of computer programming, big data mining techniques, database management, and systems engineering.
Business Analysts Salary
As of June 2021, business analysts can expect to earn an average salary of $61,669 per year according to payscale.com, while the Bureau of Labor Statistics lists the median income of the comparable position of management analyst as $87,660 a year, with the top 10% expected to make more than $150,000 a year. Business analysts can expect salary increases for the first 5-10 years, but additional experience does not have a large effect on salary. The majority of business analysts work in the position for just 1-4 years, and almost all move on to more advanced positions within 20 years. Promotions include positions such as project manager or senior business analyst.
Job Growth for Business Analytics Majors
In response to the query, “is a business analytics degree worth it?” the job outlook for business analysts in 2021 couldn’t be stronger. The Bureau of Labor Statistics estimates that field will grow 11% by 2029, which is considered much faster than average, and there were over an estimated 800,000 business analyst roles available in 2019. As you might expect, the greatest number of business analytics careers are concentrated in the large population centers where large corporations are headquartered. The metropolitan areas with the highest rate of employment for business and management analysts are Washington D.C., New York City, Chicago, Los Angeles, and Boston.
Thus, business analysts and management analysts must continue to modify their roles and stay abreast of technological advances to stay relevant. Many business analysts have merged into data scientists themselves, and/or are finding ways to combine big data analysis with the kind of critical thinking only able to be done by a human—for now.