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The Key Role of Business Analysis in Project Success and Achieving Business Value

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The Key Role of Business Analysis in Project Success and Achieving Business Value

Transcript

The Key Role of Business
Analysis in Project Success
and Achieving Business
Value

Alan McSweeney
Objectives

• To define the importance of effective business analysis in
ensuring project success and delivery of business value

June 25, 2010 2
IT Challenge to Deliver Business Value
Provides Alignment
• IT is viewed as a provider and Between Business and IT
enabler of business value
Managing IT for
• IT faces pressure to deliver Managing IT Like
Business
a Business
value Value
− Additional revenue
− Reduced or avoided costs
− Greater productivity
− Reduced risk
− Respond quickly to changing
business environment and
Managing the IT Managing the IT
business needs Budget Capability
• IT needs to structure itself to
deliver business value Provides Metrics to Close
the Loop on Value

June 25, 2010 3
Familiar View of Project and Project Portfolio
Management
Project
Demand Management
Management Methodology
Project
Approvals
Programme and People
Strategic Project Portfolio
Project Management
Alignment Management
Management and Education
Project
Requests
Supply Organisation
Management Prioritising Managing Projects Enablers
Projects Successfully

• Contains the implicit assumption that the solutions being delivered by the projects are
designed properly, are implementable and operable and meet business requirements
• Is this correct? Is this the complete picture?
• More is need than just the right project managed the right way
− The solution being delivered by the project must meet business needs
June 25, 2010 4
Aligning the Solutions Being Delivered to Business
Needs and Delivery of Business Value
• Need more than project management
− Not the complete picture
− Cannot treat project management in isolation
• Need to ensure that the solution being managed meets business
requirements
• Need to ensure business requirements are captured
• Need to ensure that solutions are designed to deliver business
requirements and comply with organisation’s enterprise architecture
• Fundamentally the project exists to manage the delivery
of the solution that has been designed to meet agreed
business requirements that assist with delivery of the
business plan to achieve business value
June 25, 2010 5
Business Analysis and Design Builds Bridge From
Business to Solution
Problem
Requirement Business Analysis:

Elicit Requirements
Current State Analyse
Communicate
Business Validate
Analysis and
Solution Design
Solution Design:

Translate
Requirements into Solution
Solution
Desired Future
State
• Business analysis is a key driver of business value
• Solution delivery start with business analysis
June 25, 2010 6
Weaknesses in Business Analysis Capabilities and
Competencies at the Root of Many Project Failures
Poor Size/Capacity/ Poor Strategic
Requirements Complexity Alignment
Poor Analysis Large Project, Inadequate Business
Practices Complex, Difficult Case, Undefined
Changes and Processes Problem/Need

Business Requirements Large Project Team and Business Benefits Business Needs
Not Captured Multiple Stakeholders Not Measured Not Met

Opportunities
Lost

Investment
Inadequate Resource Unproven Technology Inadequately Explored Wasted
Allocation and Solution Options
Prioritisation

Inadequate Business Dynamic, Changing Solution Design Not
Involvement Environment Aligned to Business Needs

Poor Focus on Uncertainly/ Poor Solution
Business Needs Ambiguity Design
June 25, 2010 7
Analysis-Related Causes of Failures

Poor Size/Capacity/ Poor Strategic
Requirements Complexity Alignment
Poor Analysis Large Project, Inadequate Business
Practices Complex, Difficult Case, Undefined
Changes and Processes Problem/Need

Business Requirements Large Project Team and Business Benefits Business Needs
Not Captured Multiple Stakeholders Not Measured Not Met

Opportunities
Lost

Investment
Inadequate Resource Unproven Technology Inadequately Explored Wasted
Allocation and Solution Options
Prioritisation

Inadequate Business Dynamic, Changing Solution Design Not
Involvement Environment Aligned to Business Needs

Poor Focus on Uncertainly/ Poor Solution
Business Needs Ambiguity Design
June 25, 2010 8
Consistent Approach to Business Analysis

• Adopt a consistent and robust framework in business analysis
− Enables effective benefits realisation through a solution which meets the
business need
• Key elements
− Establish enterprise standards, procedures and governance
− Standardise on infrastructure, analysis methods and operational procedures
− Develop competence and skills
• Key benefits
− Implement solutions that meet business needs
− Increase the ability of the business to adapt quickly to changes
− Reduce risk, complexity, redundancy and support complexity
− Align business and IT
− Enable re-use and faster time-to-market
− Present one face to the business (customer)
− Increase business value

June 25, 2010 9
Business Analysis Role Key Skills and Abilities

Business Analysis
Role Skills and
Abilities

Business Analysis
Personal Underlying Techniques and
Role-Specific
Competencies and Tools Experience
Performance
Characteristics and Skills
Competencies

June 25, 2010 10
What Makes a Good Business Analyst and Business
Analysis Function?
Business Analysis Role
Skills and Abilities

Business Analysis Role- Personal Underlying
Techniques and Tools
Specific Performance Competencies and
Experience and Skills
Competencies Characteristics

Business Analysis
Requirements and
Planning and
Information Elicitation
Monitoring

Requirements
Requirements Analysis Management and
Communication

Solution Assessment
Enterprise Analysis
and Validation

June 25, 2010 11
Business Analysis Key Skills

Business Analysis Role Skills
and Abilities

Business Analysis Role- Personal Underlying
Techniques and Tools
Specific Performance Competencies and
Experience and Skills
Competencies Characteristics

Analytical Thinking and
Organisation and Trust
Problem Solving

Business, Industry and
Communication Skills
Organisation Knowledge

Facilitation, Negotiation,
Leadership, Influencing and Analysis Tools
Teamwork
June 25, 2010 12
Business Analysis Key Skills
Business Analysis Role Skills
and Abilities

Business Analysis Role- Personal Underlying
Techniques and Tools
Specific Performance Competencies and
Experience and Skills
Competencies Characteristics

Data and Process Modelling Interviewing

Functional and Non-
functional Requirements Requirements Workshops
Analysis

Vendor and Software Metrics and Key
Assessment Performance Indicators

Acceptance and Evaluation
Prototyping
Criteria Definition

June 25, 2010 13
Business Analysis Challenges

• Lack of advance planning for projects and initiatives
• Lack of formal training for business analysts
• Inconsistent approach to business analysis
• Outsourcing and relying on external contractors to
perform major roles in system development
• Impatience with the analysis/design/planning process
• Gap between what business analysts are assigned to do
and what they should be assigned to do

June 25, 2010 14
What is a Project Failure?

• Over schedule
• Over budget
• Project cancelled
• Solution ultimately not used and withdrawn
• Does not deliver on business case
• Does not deliver on business benefits
• Does not deliver business value
• Poor system usability and/or high error rates requiring
rework
June 25, 2010 15
Business Analysis Contribution to Project Failure

• Root cause analysis of many project failures
− Poor focus on business needs that means the project is not what
the business needs and will therefore use
− Poor requirements capture and definition
− Poor strategic alignment that means the business case is not well
constructed
− Poor solution design that means the solution does not deliver on
the specified requirements
• Business analysis failures are at the root of these failures
• Well-executed business analysis fully integrated into the
project management process ensures projects deliver on
the expected benefits
June 25, 2010 16
Maximising Solution Value Throughout Lifecycle

Good Solution
Delivery

Good Analysis and
Poor Solution Design Followed by
Delivery Poor Solution
Delivery is Better
Good Analysis Than Poor or
and Design Achievement Inadequate
of Business Good Solution Analysis and Design
Value Delivery Followed by Good
Solution Delivery

Poor or
Inadequate Poor Solution
Analysis and Delivery
Design
June 25, 2010 17
Maximising Solution Value Throughout Lifecycle
Solution Solution Solution Solution
Design Development Transition Operation

Improved Delivery of
Business Needs
Improved
Management
of Transition
Achievement
of Business Improved
Value Solution
Design

Improved
Business
Analysis

June 25, 2010 18
Maximising Solution Value Throughout Lifecycle

• Good solution and project definition delivers superior
business value
• Poor solution and project definition results in lower
business value, even if it is followed by good project
management
• Good project management does not make a bad solution
good

June 25, 2010 19
Solution Life Cycle Cost Composition
LIFE CYCLE COST

SYSTEM ACQUISITION
COST •Operations
PROCUREMENT COST •Internal Support
•Planning, Research, •Disposal
TOTAL SYSTEM COST •External Support and Analysis and Design
Maintenance •Ongoing Test
BASIC SYSTEM COST •Training •Subscription Facilities
•Documentation
•Hardware •Support Facilities
•Software •Parallel Running
•Development and •Warranty
Implementation
•Management
•Installation
•Transition and
Cutover
•Conversion

June 25, 2010 20
Solution Life Cycle Costs
Total Cost of Ownership

System Acquisition Cost Operating and Support Cost

COST

YEARS

• Depending on the life of the solution being implemented, the
operating costs can be 1-3 times the cost of acquisition
• Getting the solution design right at the start delivers very significant
increased benefits throughout the solution’s life
June 25, 2010 21
IT Investment Management and Project and
Solution Lifecycle
Structured Capture
and Management of
Cost Effective Requirements and
Operation of Business Analysis Cost Benefit Analysis
Delivered Solution of Solution Costs
and Effective Solution
Retirement/ Operation
Replacement/
Upgrade Decisions
Key Phase
in Solution
Delivery to Design/Selection of
Cost Effective
Drive Solution Solutions to Meet
Business Architecture and Requirements
Including
Cost Effective Design
Delivery of Programme and Value Evaluation of All
Projects and Options
Project
Management of Management
Costs

Project Portfolio Prioritisation of
Management Projects and
Investment
Decisions
June 25, 2010 22
Ensuring Strategic Project Alignment to Projects
Programmes and projects
Business Vision and
cascade from business vision to
Goal ultimate operation and service
delivery
Strategy

Business Analysis identifies
the business needs and
Business Plan document the requirements
of the solution
Programmes and projects need
Programmes for
to be aligned to the
Strategic Objectives
overarching business vision
and goal
Projects
Business Analysis we
ensures that the right
solution is designed Operation of Solution

June 25, 2010 23
Hierarchy of Requirements – from Enterprise to
Project/Initiative
Solutions delivered by
Business Vision and Re programmes and projects
qu
Goal ire cascade from business vision
me
nts to ultimate operation and
Hie service delivery
Strategy rar
ch
y –f
rom
Bu
Business Plan s in
ess
to
De Sp
liv eci
ery Programmes for fic
an Ini
dO
Strategic Objectives tia
tiv
pe es
Solutions delivered by rat
programmes and projects ion Systems and
need to be aligned to the Solutions
overarching business
vision and goal
Operation of Solution

June 25, 2010 24
From Strategy to Business Value to Business Benefits
Business Vision and
Goal

Strategy Defines Organisational
Targets

Defines Business Value Gains to
Business Plan the Organisation – Accumulated
Net Business Benefits
Calculates Defines Business Benefits
Programmes for Delivered and Contribute
Strategic Objectives to the Delivery of
Business Value
Calculates Systems and
Solutions

Calculates Operation of
Solution
June 25, 2010 25
From Strategy to Business Value to Business Benefits
Ag
ree
Va and
lue D
to efin
be e N
Strategy Defines Organisational De ee
liv d a
Targets ere nd
d
Defines Business Value Gains to
Business Plan the Organisation – Accumulated
Net Business Benefits
Calculates Defines Business Benefits
En Programmes for Delivered and Contribute
sur Strategic Objectives to the Delivery of
eN
Va ee Business Value
lue ds
Ge are Systems and
ne Me Calculates
rat t a Solutions
ed nd
Calculates

June 25, 2010 26
Complete Picture of Project Selection and Delivery

• Need to consider all aspects of project selection and
delivery:
− What the business wants (requirements)
− What the business gets (solution that delivers on requirements)
− Delivered according to business priority (project portfolio
management)
− Implemented properly (project management)
• Cannot take an individual view without risking problems
• Need to emphasise the importance of the solution whole
lifecycle and the interdependence of the roles

June 25, 2010 27
Business Analysis Through the Solution Lifecycle

• Need to do more than capture requirements initially
• Requirements management needs to take place
throughout the delivery lifecycle to confirm business needs
and being met and business value will result
• Requirements changes must be managed throughout the
solution lifecycle

June 25, 2010 28
Business Analysis Approach to Business Requirements
Collection and Management During Solution Delivery
Lifecycle

e
tur
Cap

As s e
Gather Analyse Review

ss
Cha
nge

Requirements Definition Requirements Management
• Gather – Collecting requirements • Capture – Ensure that the new
requirements or change requests are
• Analyse – Analysing, categorising and
captured
specifying requirements
• Assess – Evaluate whether the changes
• Review – Review and agree exactly
will be actioned and approve or reject
what the requirements are
• Change – Undertake the changes

June 25, 2010 29
Relative Cost of Fixing Errors During Project Lifecycle
1000

• Errors/gaps/omissions
become significantly

(Logarithmic Scale)
100
more expensive to fix at
later stages of project
lifecycle 10

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st
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en
pm
lo
ve
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Low Cost Estimate High Cost Estimate

June 25, 2010 30
Business Analysis is a Key IT Competency

• Business analysis function manages the entire solution
requirements lifecycle from understanding the business need to
ensuring that the delivered solution meets business needs and adds
business value
• Projects all too frequently experience difficulties not from lack of
technical expertise but from an a failure to gather, understand,
analyse and manage business requirements, and convert them into
realistic achievable solution specifications
• Projects are all too frequently initiated and solution design and
implementation started before there is a clear understanding of the
business need
• High tolerance and acceptance of inadequate and ever-changing
requirements leading to requirements and scope creep

June 25, 2010 31
Business Analysis is a Key IT Competency

• Business analysis focuses on adding value to the business
− Business analysis provides
− Detailed project objectives
− Business needs analysis
− Well defined and structured requirements
− Requirements trade-off analysis and requirements feasibility and
risk analysis; and cost-benefit analysis
• Without business analysis poor requirements definition
happens, resulting in a disconnect between what the
business needs and what solution is delivered
• Effective business analysis is a combination of technical,
analytical, business and leadership skills

June 25, 2010 32
Business Analysis Skills

• Identify and understand the business problem and the impact of the
proposed solution on operations of the organisation
• Document project scope, objectives, added value and benefit
expectations
• Translate business needs and objectives into system requirements
• Design and develop high quality business solutions
• Liaise with customers/stakeholders/users during installation and
testing of new systems and services
• Evaluate business needs and contribute to strategic planning of
information systems and technology directions
• Assist in determining the strategic direction of the organisation

June 25, 2010 33
More Information

Alan McSweeney
alan@alanmcsweeney.com

June 25, 2010 34