Business analysts act as a bridge between a company’s high-level goals and their day-to-day strategies. They help stakeholders identify a business’s most important needs, and then work closely with individual departments to satisfy those needs.
A business analyst is often involved in aligning IT teams and business operations. This means not only identifying data-driven solutions to business issues but also facilitating communication between these two teams to ensure these solutions are implemented effectively. They also work with IT leadership to identify the best ways to use technology across an organization, whether that means cloud computing, new software, or ongoing cybersecurity training for employees.
What Is Business Analytics?
Business analytics is the process of studying data and using the information to improve operations.
The process begins with data collection and cleaning, which typically also involves removing incorrect or outdated data points. Business analytics then follows three steps:
- Descriptive analytics apply specific statistical models to data to identify trends. This highlights useful data patterns to help companies understand customer behavior, website users, or revenue.
- Predictive analytics use the trends identified in the first step to forecast how the company might perform in the future.
- Prescriptive analytics looks at identified trends and business forecasts to suggest ways companies can change or correct operations to achieve their goals.
The goal of business analytics is to take raw data, identify useful takeaways from that data, and use that intelligence to inform future business decisions.
The Rising Importance of Skilled Analysts
The business analysis role is only growing more important. Careers in this field are expected to grow 10% through 2032, faster than the average across the entire American workforce.
Nearly 93,000 new business analyst job openings should appear each year, as companies look for new ways to use resources more effectively. Information technology (IT) and human resources (HR) companies will also look to hire a high number of new business analysts, often to help identify ways to enhance business performance across borders.
How Business Analytics Use Data Analysis To Inform Business Decisions
With the right tools, business analysts can use the multi-step data analysis process to transform raw data into recommendations for business improvement. They can explore trends in website traffic and suggest ways to improve the online customer experience. They might find patterns in buying habits and suggest ways to bundle products. By examining historical sales data, they can forecast future buying activities.
Types of Business Analyst Roles
Business analysts perform different responsibilities according to their respective roles within the company. For example, a business process analyst works to improve the way a company functions each day. By contrast, a business systems analyst spends more time connecting IT and business teams to improve internal technology usage.
Business analysts spend the majority of their time extracting useful insights from raw data sets. They often work alongside business intelligence analysts, who use this information to keep companies informed through dashboards and KPI scorecards.
The Role of a Business Analyst
Many business analysts fill a solution-oriented role. They study data to find insights that improve the way their employer does business. Analysts regularly communicate with stakeholders, proposing data-driven solutions that satisfy core issues.
Among other responsibilities, analysts serve as a mediator between leaders and IT teams. They help translate needs into technical requirements that an IT department can act on. Analysts also communicate from IT teams back to stakeholders, translating technical constraints or challenges for leaders to indicate their priorities.
In addition to key soft skills like communication, business analysts need certain hard skills to effectively execute their responsibilities. Though requirements can vary between positions, this often includes familiarity with structured query language and general querying, statistical languages and software, and data analysis.
Business Analyst Job Description: Typical Projects, Tasks, and Goals
Business analysts guide companies through a constant cycle of improvement. They gather information through a wide variety of formats — including stakeholder interviews, employee surveys, and customer data analysis — and study it for useful insights.
These professionals can work in any industry, though most work in a scientific, professional, or technical field. These fields include sectors like healthcare, IT, finance, and retail, where analysts are expected to improve efficiency in ways that improve sales.
Key Responsibilities of a Business Analyst
Business analysts handle data analysis, interpretation, and reporting responsibilities on behalf of their employer. They are also responsible for consulting on most aspects of corporate operations, from workforce management to customer service.
Here are a few responsibilities that a business analyst manages:
- Business process evaluation: Business analysts review current business processes to identify inefficiencies and build solutions that address them.
- Solution development: Business analysts develop solutions, often alongside IT teams, that make internal processes and contributors more efficient.
- Stakeholder reporting: Business analysts communicate data insights, process improvement, and performance forecasts to company leaders.
- Performance forecasting: Business analysts use data analysis and predictive modeling to estimate how a company might perform in the future.
A business analyst plays an important role in the entire lifecycle of a project, more than most employees. They are often responsible for first suggesting a project, based on how data suggests that project might improve company output. They gather requirements, create timelines, and deploy potential solutions before reviewing results with stakeholders.
Business Analyst Salary: How Much Can Analysts Make?
A business analyst typically earns between $57,840 and $172,280 each year, depending on factors such as experience, education, and work environment.
Becoming a Business Analyst
Aspiring business analysts need both education and real-world skills to flourish in this career. Most positions require at least an undergraduate degree, and you may also choose to add a master’s degree to your resume for added experience. You will also need to learn skills like data analysis, communication, and stakeholder management.
Education Requirements
Most business analysts complete at least a bachelor’s degree, typically in fields like business or social science. Some employers prefer candidates with a Master of Global Business Administration, which teaches immediately transferable skills in business foundations, including leadership, cohesive reporting and writing, decision analysis for business, data analysis, and statistical methods.
You’ll also need hands-on experience in fields like data analysis, IT, change management, and financial analysis. These skills create well-informed business analysts, whether you’re looking for a full-time career in business or a consulting role.
Important Skills for a Business Analyst
Business analysts depend on a variety of technical and soft skills each day.
Here are a few of those most important skills:
- Analytical thinking: Business analysts dissect complex data sets to diagnose underlying issues and identify growth opportunities.
- Communication: Business analysts convey ideas clearly and respectfully to IT teams, stakeholders, and fellow analysts.
- Problem-solving: Business analysts recognize challenges and build effective solutions that address their root causes.
- Critical thinking: Business analysts evaluate information from multiple sources and use it to solve complex problems.
Adaptability is also an important quality in successful business analysts. This means adjusting your approach as business processes, technologies, and priorities change. You’ll need to navigate situations and make informed decisions, even if you don’t have all the answers about a particular challenge.
Career Progression
Business analysts often begin their careers in junior or assistant analyst positions. After gaining the necessary experience, they can move into independent analyst roles. With continued education, business analysts can achieve senior positions and begin working toward director of business analysis roles.
While each of these roles assumes more experience and responsibility, they are all based on the same fundamentals: data analysis, analytical thinking, and the ability to help companies recognize the best path forward.