Business analysis (BA) is a term that is usually associated with a particular role of someone who has taken on the responsibilities of business analyst, typically within a corporate setting.

While this notion is correct, it is also incomplete, mainly because it fails to recognize that BA is more than just a job title, but also a discipline.

According to the International Institute of Business Analysts (IIBA), BA is described 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 recommend solutions that enable the organization to achieve its goals.”

Business analysis is not the exclusive domain of someone with the title of Business Analyst, as other key roles can also perform business analysis functions, especially if they have taken up business analysis courses. This means that project managers, developers, QA analysts, consultants, and the like could likewise be expected to carry out BA-related tasks at any given time.

To be effective, business analysis functions require a specific set of Key Performance Indicators (KPIs) that make use of a set of criteria, which serves as the basis for evaluating the performance of each role and team member.

KPIs provide a high-level overview of a business or its back room operations based on measurable, predefined metrics. It is usually created and viewed in various formats that include reports, charts, spreadsheets, or a combination of each and serves as a tangible representation of where a business currently is, how it is performing vis-a-vis its competitors, and what improvements can be introduced to increase the chances of future success.

KPIs are the basis for making sound business decisions that will help an organization reach its stated goals and targets.

Here are some of the most commonly used KPIs to help in your business analysis functions.


Business Process Optimization KPIs

  • Business Process Productivity Increase % – This is defined as the actual increase in productivity after implementing the new system.
  • Cycle Time Reduction % – This is the reduction in cycle time after the system implementation.
  • Unit Cost – This is the average unit cost reduction after implementing the new solution within a 6-month period.
  • Increase in Revenue attributed to Solution – Expressed as the actual revenue increase because of the solution used.
  • Decrease in Cost attributed to Solution – This is the decrease in cost because of the solutions used.


Project Value KPIs

  • Deviation of planned Return on Investment – Defined as the difference between ROI in the planned baseline and the actual ROI.
  • Deviation of net present value (NPV) – Defined as the difference in value between the planned baseline against the actual net present value.
  • Deviation of planned break-even time – This is the difference in time between the planned baseline against the actual break-even time to determined, where the business expense equals the income generated.

business analysis_Apex middle banner

 

Quality Effectiveness KPIs      

  • Percentage of rework attributable to requirements – Rework can be expensive, costing an organization up to 40% of the total budget, where up to 70% is related to inaccurate or ambiguous requirements. To prevent this, it is best to define KPIs clearly from the outset.
  • Percentage of projects with prioritized requirements – Identifying which projects to put at the top of your priorities is an important step to ensure that only high-value items are given the attention they need.
  • Percentage of requirements fully implemented – This helps business analysts to trace requirements through testing, proper designs, and accurate deployment.
  • Percentage of approved requirements not implemented – This tests the likelihood of overall user experience and satisfaction with the result.
  • Developer Requirements Satisfaction Index – Developers should be surveyed to determine their satisfactions with requirements.
  • QA Requirements Satisfaction index – Survey results from QAs to ensure that requirements are testable.
  • Percentage of Requirements Tested – Result of what percentage of requirements were actually tested, and which ones were not.

 

Stakeholder Engagement KPIs

  • Stakeholder Satisfaction Index – The result from a series of interviews to determine overall satisfaction with the requirements.
  • Number of stakeholder comments received? – The total number of comments or concerns provided by stakeholders with regard to the given requirements.
  • Stakeholder lifecycle participation – The total number of stakeholders who participated in lifecycle events. This value is typically expressed as a percentage.
  • Number of stakeholder complaint (emails and letters) received
  • Number of key stakeholders that were not identified or identified late in the project – It is crucial to determine how many stakeholders were missed while conducting the stakeholder analysis activity.
  • Number of participating stakeholders – The total number of stakeholders who were actually interviewed or participated in focus group discussions and activities.
  • Stakeholder Attendance % – Expressed as a percentage of the total number of stakeholders who showed up during meetings versus the number of invited stakeholders.
  • Number of needs identified by stakeholders – Shows the number of needs that were successfully translated into requirements. This measure provides an accurate picture of engagement based on how many of the needs were actually provided.

The primary function of business analysis is to see to it that all the requirements needed for optimal performance are identified and analyzed properly.

Using KPIs is the most efficient method of capturing these requirements, as it is the basis for identifying problems and providing the best solutions to course-correct any pain points and issues. Regularly monitoring KPIs has proven to be the optimum way to help stakeholders come up with sound business decisions that will help them achieve their objectives in a timely manner.

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