BUSINESS ANALYSIS AND FINANCIAL POLICY

UPSA – LEVEL 300Mr. Charles Barnor, Mr. Danaa

Nantogma and Mr. K. Fosu-Boateng

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Week 1Introduction to Business Analysis and

Financial Policy• INTRODUCTION Week 1• BUSINESS STRATEGY ANALYSIS Week 2&3• INVESTIGATION TECHNIQUES Week 4-5• CONSIDER PERSPECTIVES Week 6• ANALYSE NEEDS Week 7• CASE STUDY PRESENTATIONS Week 8• INTERIM ASSESSMENTS Week 9• EVALUATE OPTIONS Week 10• CORPORATE FINANCIAL POLICY DECISIONS Week 11• DEFINE REQUIREMENTS Week 12• REVISION Week 13

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Topic 1Introduction to Business Analysis and

Financial Policy

• The rationale for business analysis• The development of business analysis• The scope of business analysis• The responsibilities of a business analyst• The Business Analysis Maturity Model• The competencies of a business analyst

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• Business analysis is 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 will enable an organization to achieve its goals (International institute of business analysis, 2008).

• The development of business analysis as a professional discipline has extended the role and responsibilities of the business analyst (BA). Business analysts investigate ideas and problems, formulate options for a way forward and produce business cases setting out their conclusions and recommendations.

Introduction

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Business analysts have responsibility for the following areas:

• Identifying the tactical options that will address a given situation and will support the delivery of the business strategy

• Defining the tactics that will enable the organization to achieve its strategy

• Supporting the implementation and operation of those tactics

• Redefining the tactics after implementation to take account of business changes and to ensure continuing alignment with business objectives

The development of business analysis

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There is a chain of reasoning that leads from the statement of a problem to the implementation of solutions…

POST-IMPLEMENTATIONBusiness Analysts feed back to the Owner how well their

measure of success has been achieved

Owners defines measures of success and $targets

…Business Analysts confirm & document

Strategists determine the strategy to hit the targets…Business Analysts help do market research, create strategy, challenge & documentSponsors

establish a Programme that delivers the strategy…Business Analysts document Programme TOR

and help build the Business Case

Programme ManagersInstitute Projects that implement the programme…Business Analysts document the Project TOR

Project Stakeholders…Business Analysts specify requirements for

Projects (in the Business Model)

Design Analystsdesign solution that satisfies the requirements…Business Analysts write functional specifications, protect requirements & document compromises

Project managersImplement solution

…Business Analysts help with-Process and data migration

-Cutover planning-Rollout

Solution Builders & Businesstest solution…Business Analysts ensure tested against requirements

Solution Builders build solution

…Business Analysts protect requirements & document compromises

UsersAccept solution…Business Analysts help with-$MEASURING $BENEFITS $REALISATION

Setting the scene: scope of the Business Analyst role

$Money!

…involving up to 10 groups of people…

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Stakeholders

Drivers

Objectives Objectives Objectives Objectives Objectives

Drivers Drivers Drivers

ChangeRequirements

ChangeRequirements

ChangeRequirements

ChangeRequirements

ChangeRequirements

Chain Of Reasoning:

Change Requirements must be assumed to be wrong until they are proved to be right

Stakeholders

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Fundamental Components of Business Analysis

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All the Links in the Chain Of Reasoning

The problems / opportunities that the business face

The measures and targets that will enable us to declare the

change project has been successful

Driver

businessObjective

ChangeRequirement

Business Rule

Addressed asmeasured by

Delivered by

Enforces

Definitions of what changes are required that will affect the measures of success (objectives) sufficiently for the business

to be declared successful

What rules must be implemented by the changes specified in the

requirements

Description

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Business Analysis

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Business Analysis

• Purpose:– Identify where the business stands

in relation to rivals, etc.– Collect and use data to inform business decision

making– Identify strengths and weaknesses

in the business– Use information to inform strategic planning

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Business Analysis

• Method:• Collection of data

from a range of sources:• Market research• Past sales data• Market growth data• Specialist analyst data• Secondary data, e.g. Mintel

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Data

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Analysis• Range of methods used to analyse data:• Trends

– Growth rates– Nominal– Average

• Mean• Median• Mode

– Variance• Standard deviation• Range

– Time series analysis– Scatter graphs

• Correlation

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Trends

• Looking for patterns in data collections

• Frequency and reliability of trends• Impact of external factors, e.g. seasonal

variation, random events, cyclical trends

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Averages

• Averages are a measure of central tendency – the most likely or common item in a data series

• Calculated through 3 measures:– Mean– Median– Mode

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Averages

• Mean = Sum of items in the series/number of items

X = Σx x

• Median = middle number in a data series – 0.5 (n+1)

• Mode = the most frequently occurring value in a data series

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Variance

• Averages have limitations – measures of data spread used to assess width

• Range – difference between the highest and the lowest value

• Standard Deviation – used to measure the variance of the data set from the mean – can highlight how reliable the mean is as being representative of the data set

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The Standard Deviation

S =Σ (xi – x )2

n

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Correlation

• The degree to which there is a relationship between two or more random variables

• The closer the relationship the higher the degree of correlation

• Perfect correlation would be where r = 1

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Time-Series Analysis

• Used to analyse movements of a variable over a time period – usually years, quarters, months, etc.

• Importance of assessing the:– Trend– Seasonality– Key moments– Magnitude

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Presentation

• Graphs• Charts• Tables• Index numbers – Method of showing average changes in

large amounts of data– Laspeyres – Uses a base period weighting measurement– Paasche – Uses a current price weighting measurement

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Forecasting

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Qualitative• Focus groups - a group of individuals selected and assembled

by researchers to discuss and comment on, from personal experience, a topic, issue or product

• User groups – similar to focus groups but consisting of those who have experience in the use of a product, system, service, etc.

• Panel surveys – repeated measurements from the same sample of people over a period of time

• Delphi method – calls on the expertise and insights of a panel of experts to help with forecasting – seen as being more reliable than data analysis only

– Could be drawn together from around the world as there is no need to have people together at the same time

• In-house judgements – Use the expertise and judgements of those involved in the business in aiding and making judgements

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Quantitative• Makes use of all the statistical data collected by the firm

and by other firms/organisations to help inform decision making– Surveys– Sales data– Impact on sales

• Primary data – collected by the firm themselves• Data collected by others and used by the firm, e.g. Office

of National Statistics (ONS), Gallup, Mori, Mintel

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Forecasting

• Advantages and disadvantages:• Data from several years can give accurate guides to

future performance• Statistical techniques can make

the data informative and useful• All depends on the quality of the data and the

accuracy of the techniques used to analyse the data

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• Q& A

• THANK YOU

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