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Why Business Analysts Are So Important for IT and CIOs

A new Forrester report sheds light on this little known, often misunderstood but critical liaison role that can unite the business and IT on enterprise projects, systems development and business strategy.

By Thomas Wailgum

April 16, 2008 — CIO — For two decades, the CIO has been viewed as the ultimate broker between the business and technology functions. But while that may be an accurate perception in the executive boardroom, down in the trenches, business analysts have been the ones tasked with developing business cases for IT application development, in the process smoothing relations among competing parties and moving projects along.

According to a new Forrester report, however, the reality is less precise than this description. The business analyst position varies depending on the organization, and the line between pure business functions and IT functions has eroded.

What is clear: The most successful business analysts are the ones who blend the temperament and communications savvy of a diplomat with the analytical skills of an intelligence officer. And business analysts are a hot commodity.

The in-depth April 2008 Forrester Research report by analysts Carey Schwaber and Rob Karel provides a better understanding of this crucial yet largely undefined role. "Everyone agrees on the importance of the business analyst role," the analysts write, "but few know exactly what it is that business analysts do."

The 21st century business analyst is a liaison, bridge and diplomat who balances the oftentimes incongruous supply of IT resources and demands of the business. Forrester's research found that those business analysts who were most successful were the ones who could "communicate, facilitate and analyze."

Some business analyst positions tilt more toward business functions such as operations, marketing, finance or engineering; other analysts seem to fit better in more IT-oriented positions such as in applications and architecture groups, or in project management offices.

According to the Forrester analysts, however, not many people, including business analysts themselves, are able to figure out a standard definition (complete with typical skill sets, proper training methods and set career paths) for the business analyst position.

To better understand the business analyst function, Forrester surveyed 338 current and former business analysts and reviewed more than 29,000 business analyst job postings. What Schwaber and Karel found out is that, at present, there are "many different breeds of business analysts, each native to a particular silo within the enterprise, and each focused on addressing the most critical concerns within that silo," they write in the report, "The New Business Analyst."

The 'Business Technology' Analyst: A CIO's Best Buddy

The Forrester analysts also discovered that like many technology-intensive roles inside companies today, the line between a pure business analyst and a pure IT business analyst has blurred. The waters are muddied even more because business's IT needs (such as ERP systems consolidation or enterprisewide data warehouse rollouts) span not only different departments but across entire companies. In addition, newer technology methodologies, such as services-oriented architecture (SOA), require a deep understanding of both business and IT as well as close attention to changing business conditions, write Schwaber and Karel.

 

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