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In the world of big data, there are many job titles falling under the umbrella of “analyst,” each with its own particular area of focus. For those with an aptitude for computer science who have a background in business, becoming a business analyst is an excellent option, allowing you to put both skills into practice to help companies develop data-driven strategies in operations ranging from production to marketing and so much more.
Business analysts are highly valued professionals whose insights help companies turn abstract data into actionable plans.
Now more than ever, businesses across industries are seeking business analysts for their teams so that they can reap the benefits from the tremendous amount of data they collect. If you’re looking for a data science career that will be fruitful and sustainable in the long term, the business analyst profession could be the perfect choice for you.
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The Evolution of the Business Analyst
A business analyst, also known as a management analyst, is in charge of understanding a business’s continuously evolving needs while providing technological solutions to improve its processes and systems. In this way, a business analyst is often thought of as the link between the business and IT departments.
Historically, companies began to convert paper-based processes into automated, electronic processes in the 1970s and 1980s with the advent of computers. Business analysts entered the scene in the 1980s and 1990s to pair this new technology with business acumen.
However, technology is continuing to change this role. Recent advances in big data mean that the role of the business analyst has evolved a great deal. Today, business analysts (alongside other roles in data science) are able to mine big data to understand customer behavior and identify system inefficiencies, for example.
This career guide provides the steps necessary to becoming a business analyst, detailed job information, as well as the job prospects and average salary projections.
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What is a Business Analyst?
Business analysts work within an organization to evaluate current systems and develop strategic plans. This requires deep knowledge of both the specific business as well as industry trends and conventions. A key aspect of the business analyst role is communicating plans between internal departments and external stakeholders.
Agents of Change: The International Institute of Business Analysts (IIBA) consider business analysts to be agents of change, and thus a primary role of the business analyst is to introduce change in an organization. These changes might be high-level, such as larger scale structural or policy changes or they might be more granular such as finding opportunities for cutting costs. Either way, the changes introduced by a business analyst should help an organization find and realize new opportunities.
Solving Business Needs: Business analysts will also develop or update computer systems to solve their business needs. The business analyst provides requirements to the IT department to produce this new technological system and also supports the testing and implementation of the system.
What Does a Business Analyst Do?
A business analyst scrutinizes sets of data looking for ways to increase efficiency in an organization. In this way, the business analyst often acts as a liaison between different departments in a company, finding ways to streamline processes throughout the organization. The business analyst must be able to communicate well within these different organizational groups, sometimes acting as diplomat, presenting solutions in ways that colleagues and stakeholders will understand and appreciate.
Business analysts engage in four main types of analysis:
- Strategic planning—identifying changing needs of a company
- Business model analysis—defining policies and market approaches
- Process design—standardizing workflows
- Systems analysis—interpretation of requirements for the IT department
Business analysts might deliver many different types of solutions in many different formats, including business plans, data models, flowcharts, or strategic plans.
Three Steps to Launching a Business Analyst Career
Step 1: Get an Undergraduate Degree in Business Administration, Finance, or Accounting
Beyond your bachelor’s degree in business, you’ll want to learn some computer programming. Different business analyst roles require different levels of technical proficiency, but the better developed your programming skills, the better you will look as a candidate.
The IIBA’s Business Analysis Body of Knowledge (BABOK) reference book is a key resource to begin understanding the tasks and techniques of a business analyst.
Step 2: Gain Work Experience
You can gain experience in a volunteer role with a small company first or take advantage of summer internship opportunities. If you are already working with a company in a different role, offer to work on the kind of projects that business analysts undertake.
There are many transferable skills to working as a business analyst, since it is a role that is considerably wide-ranging. Individuals can enter the field either with knowledge of a specific business domain, such as workflow, billing, or customer relations, or with knowledge of an industry at large, such as finance, telecommunications, or government.
Once you are hired as an entry-level business analyst, make sure to gain experience by working on as many varieties of projects as you can; later, you can specialize in the domain or industry you are particularly interested in and that experience may help you discover what that industry is.
Step 3: Earn a Master’s Degree or Obtain an Advanced Certificate
Many universities offer master’s degrees and graduate certificates in business analytics, which generally include courses in business data analytics, operations research, project management, database analytics, and predictive analytics.
For those with advanced knowledge of business analytics, the IIBA offers a professional certificate called the Certified Business Analysis Professional as well as a variety of other more specialized certifications that may fit the specific career path that you had in mind.
Business Analyst Job Description
Though there are many different aspects to the role, business analysts generally follow a pattern of gathering research, presenting solutions, and then implementing these solutions in the form of new or adapted technology. In the process, a business analyst might be required to do the following:
- Communicate with colleagues to understand the needs of the business
- Work with stakeholders to understand the service or product provided
- Conduct surveys, workshops, and tests
- Analyze and model data to produce conclusions
- Create suggestions and solutions for strategic and operational changes
- Consider the opportunities and risks of these suggestions
- Invent systems or processes necessary to implement these changes, or alter existing systems that already exist
- Communicate with senior management about introducing recommendations to the business
- Write reports to present to stakeholders
- Support staff as solutions are implemented
- Evaluate impact of changes made
The specific duties of a business analyst role are likely to vary depending on your employer, with a company’s industry and size determining which functions are most important to focus on. In larger companies, business analysts often work in tandem with business intelligence (BI) experts who make the first pass on collected datasets (using a process known as descriptive analytics) so that business analysts can follow up with strategic insights (using a process known as predictive analytics).
Skills Needed to Become a Business Analyst
Business analysts need to have a combination of hard and soft skills. These include:
- Communication skills: Business analysts must work in groups, collecting sometimes dense, technical information and presenting it to wide-ranging stakeholders in the company. They’ll have to translate and negotiate between parties and communicate their solutions in an accessible way. Thus, business analysts must have strong written and spoken skills and feel confident in a leadership position to gain approval for plans from superiors in the company.
- Business knowledge and critical thinking: Business analysts must understand many facets of the company they are working with. They must be able to apprehend the roles of different individuals and departments, and how these departments interact and depend upon each other. They must also be able to comprehend the single organization in a broader context of the entire industry. This business knowledge will then allow them to successfully analyze data points and build strategic plans for the future.
- Technical skills: Business analysts may use a wide range of technical programs, including programs in diagramming, data crunching, wireframing, management of requirements, and for presentation of results. More and more, business analysts are increasing their technical proficiency with knowledge of computer programming, big data mining techniques, database management, and systems engineering.
As you can see, the work of a business analyst is complex, straddling the fields of data science and business strategy. This means that the job is not for everyone. However, if you possess this well-rounded combination of skills, you’re a great candidate to take on this highly sought after profession.
Business Analysts Salary
One of the top reasons young professionals are flocking to data science professions is because of the impressive salaries and booming job growth the industry offers.
Salaries for business analysts are equally impressive. According to the Bureau of Labor Statistics, management analysts earn a median annual wage of $93,000 per year. In the industries of technical services and company management, the numbers are even higher, offering median annual salaries of $100,170 and $96,940, respectively. These outstanding numbers should be enough to make anyone with business or data expertise take business analytics as a serious career option.
Business analysts can expect salary increases for the first 5-10 years, but additional experience does not have a large effect on salary.
The majority of business analysts work in the position for just 1-4 years, and almost all move on to more advanced positions within 20 years. Promotions include positions such as project manager or senior business analyst.
Job Growth for Business Analytics Majors
In response to the query, “is a business analytics degree worth it?” the job outlook for business analysts in 2021 couldn’t be stronger.
Good news for prospective business analysts: the job market is only expected to expand over the next ten years, meaning there will be even more job opportunities than the many that are out there today.
Since data mining technology is all but certain to continue to improve in its capabilities and reach, aspiring business analysts have reason to be optimistic about job growth in the decade to come. The Bureau of Labor Statistics reports an anticipated job growth rate of 11% by 2031, which is more than double the average expected rate across industries.
As you might expect, the greatest number of business analytics careers are concentrated in the large population centers where large corporations are headquartered. The metropolitan areas with the highest rate of employment for business and management analysts are Washington D.C., New York City, Chicago, Los Angeles, and Boston.
Thus, business analysts and management analysts must continue to modify their roles and stay abreast of technological advances to stay relevant. Many business analysts have merged into data scientists themselves, and/or are finding ways to combine big data analysis with the kind of critical thinking only able to be done by a human—for now.
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Gain the skills and necessary degree to pursue your career as a business analyst. Explore our guides to What is Business Analytics, choosing a Master’s in Business Analytics program or online master’s options and take the next step in your journey. Your future as a business analyst awaits you!
2021 US Bureau of Labor Statistics salary and employment figures for business and management analysts reflect national data, not school-specific information. Conditions in your area may vary. Data accessed January 2023.
