Business Analyst: Who They Are and What They Do

The term business analyst tends to be a generic job title in multiple industries. Although the job duties can vary immensely, these analysts generally work within a business or organization to identify and implement improvements to help a company achieve its goals. The title business analyst can describe both entry-level workers, and tenured professionals, and compensation varies accordingly. This article discusses the work, salary, and outlook for business analysts.

Key Takeaways

• The term business analyst is often a generic business title that is used in different industries.
• Data analysts, solutions providers, and researchers are often classified as business analysts.
• Some of the qualities of business analysts include listening skills, multitasking, and negotiation skills.
• People who want to work as business analysts should have an undergraduate degree in a suitable field.

What Do Business Analysts Do?

Business analysis is a disciplined, structured, and formal approach to analyzing a business process, identifying improvements, and implementing changes so that the business can better achieve its goals. It is based on facts, figures, and observations.

Business analysts can serve many functions in almost any industry. For example, a systems analyst is a business analyst who focuses on how to best use technology to solve problems and improve outcomes. Other job titles where an employee performs business analysis include data analyst, solutions provider, change agent, requirements manager, specifications writer, researcher, product owner, product manager, or management consultant.

Business analysts may perform quality assurance, requirements gathering, documentation, or client support. They may also specialize in improving sales by focusing on pre-sales, customer service, client relationships, and account management. Business analysts may also be very internally focused on process improvements within an organization and coordination across multiple departments and stakeholders. 

Note

The International Institute of Business Analysis says a business analyst works to “identify and define the solutions that will maximize the value delivered by an organization to its stakeholders. Business analysts work across all levels of an organization and may be involved in everything from defining strategy, to creating the enterprise architecture, to taking a leadership role by defining the goals and requirements for programs and projects or supporting continuous improvement in its technology and processes.”

Qualities of a Business Analyst

Some qualities of a good business analyst include the following:

• Good listening skills
• Openness to change
• Adept in multitasking
• Expertise in prioritization, based on the needs of multiple stakeholders
• Good negotiation skills, to seek timely buy-in on essential decisions and prioritization from all stakeholders
• Identifying process improvement opportunities, which can lead to efficiency and output improvements

Education and Career Path of Business Analyst

A bachelor’s degree or higher is typically required to find work as a business analyst. Possible majors include finance, technology, management, and accounting. Because of the number of necessary skills, most business analyst positions are not open to new college graduates. Most business analysts attain their first position after a few years in a related job such as data analyst, functional analyst, systems analyst, business requirements analyst, or financial analyst. 

The career path of a business analyst can include becoming a senior business analyst, a business analyst specialist in specific areas (such as SAP, Agile, or ScrumMaster), a business manager, a business architect, an enterprise architect, and finally a director or VP-level position. Other experienced business analysts become independent consultants, taking assignments on contract.

Almost any industry can employ business analysts, but most jobs are in information technology or management consulting firms. Other industries include accounting, investment banking, finance, and market research. 

Salary and Compensation for Business Analysts

The compensation varies widely and is determined by factors like location, experience level, and industry. For example, a business analyst working in a large New York-based investment bank will earn more than a business analyst performing market research for an automobile company in Michigan.

Candidates who specialize in a specific technology (like SAP) may command higher premiums. Below are the average salary ranges and bonus percentages for business analysts.

• Entry Level: $80,350
• Mid-Career: $87,399 
• Senior Level: $103,232
• U.S. Average: $85,600

What Are the Responsibilities of a Business Analyst?

That depends entirely on the industry and specific job. But, there are some general functions that all business analysts do, including reviewing trends, understanding and developing business strategies, planning, budgeting, forecasting, and identifying their firms’ needs and goals.

What Is the Salary Range for a Business Analyst?

The salary range of a business analyst depends on several factors. These include experience, geography, and the company among others. The average salary for business analysts in the United States is $85,600 according to Indeed.

What Qualifications Do I Need to Become a Business Analyst?

Business analysts generally need at least an undergraduate degree to get a job in their industry. Related work experience may also benefit them to get into their field or to advance in their careers. Specific requirements depend on the industry, which means if you’re looking for a job in finance, you should have a background and experience in that field. Pay can depend on experience, education, and other factors like certification and designations.

The Bottom Line

A business analyst is a general title for many different job functions in almost any industry. A good candidate should have an undergraduate degree and several years of work experience in the area of business analysis that they are interested in. Candidates can also take business analysis certification courses like those from the International Institute of Business Analysis.