Post on 13-Jul-2020
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From Requirements Analyst to Benefits Analyst
Presenter:Mark A. MonteleonePMP, CBAP,CSM/CSPO
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Abstract
From Requirements Analyst to Benefits AnalystThis webinar is a follow‐up to an article published in Modern Analyst entitled, “The Elevator Speech…….for the BA.” We kickoff the webinar with a business analyst meeting an executive on an elevator and being asked, “So what are you working on these days?” Unfortunately, the business analyst responds in the article by citing solution requirements, disregarding the real interest of the executive being business benefits. With the above intro, the webinar focuses on understanding all the components of business analysis and provides insight on why business analysts need to expand their skills beyond the elicitation of requirements to include benefits management skills:
• developing a business case description and economics with income streams• linking income streams to cost‐benefit indicators such as
• payback period, return on investment, • net present value, benefit‐cost ratio,• internal rate of return and modified internal rate of return
• evaluating, comparing, and ranking project financials using business case descriptions and economics • mapping requirements to benefits (similar to requirements traceability)• and change management that includes the monitoring of benefits along with business case and requirement
changesAfter reviewing these skills, the webinar returns to the elevator scenario, but this time with the business analyst citing business benefits using the SMART format. The webinar then concludes with several walk‐away questions for business analysts to consider for their careers.
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Presenter BiographyMark A. Monteleone, PMP, CBAP, CSM/CSPO
Independent consultant • Experienced in PM/BA over 45 years, but it’s not the
years, it’s the mileage*• Consulted in more than 35 countries
Author of “The 20 Minute Business Analyst” and PM/BA articles in several on-line publications such as
• BA Times• BA Connection• Modern Analyst • International Association of Facilitators (IAF) Global
Flipchart
* Indiana Jones Quote – “Raiders of the Lost Ark”** Pronounce the “b” in CBAP, not the “P” in CPAP*** Never forget the “R” in scrum
• Graduate of Texas A&M University• B.S. in physics• M.S. in computing science
• Certified as a• Project Management Professional (PMP®) • Certified Business Analysis Professional (CBAP®)**• Certified Scrum*** Master (CSMTM)• Scrum Product Owner (CSPOTM)
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Mindmap of Webinar Agenda
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Mindmap of Webinar Agenda
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Mindmap of Webinar Agenda
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Mindmap of Webinar Agenda
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From Requirements Analyst to Business AnalystPart 1 of Agenda
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The Elevator Speech 1
A fortuitous meeting with someone of business importance
Having the person’s brief attention (30 seconds)
Taking the opportunity to influence the person via a profound statement or a quick summary about something important
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Business Analyst Example
A BA walks into an elevator Joined by an executive Suddenly the executive asks the BA “So, what are you working on these days?”
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Requirement Management Focus 2(BA Response – Private/Public Sector Project)
“I’m working on a project that is providing new and enhanced features to our customers/constituents.
Today, customers/constituents can only obtain information on their accounts by calling our service center.
We are working on a website that will provide direct customer/constituent access to our order database.
With this access, customers/constituents will be able to directly inquire on the status of their accounts including adding and changing their product orders without calling the service center.”
Executive response: “Great, keep up the good work.”
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Lessons from the “Elevator Speech”
1. Know your audience; what is appropriate in terms of:
• Style/Format• Tone• Time/Frequency,• Language
2. Executives are more interested in business benefits than solution requirements
Questions:
• “My focus is only on solution requirements. But what about business benefits? Is benefits management part of being a business analyst?”
• “Do I as a business analyst, know the business benefits of my project work?”
• “How do I associate requirements with benefits?” What benefits management skills do I need?
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Most Business Analysts
Project success focus –requirements management A
Respond by describing the features of a solution
Seldom mention the associated business benefits
A. Based on feedback obtained from teaching many business analysis courses over 15 years. Most BAs elicit requirements, but are not involved in the development of the business case.
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More Business Focus
Business success focused _
benefits management Conduct benefits mapping
similar to requirements traceability
Cite the impact on the business case if and when requirements change
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Mindmap of Webinar Agenda
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Aspects of Business Analysis
Strategic Analysis
BenefitsManagement
EnterpriseAnalysis
RequirementsManagement
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First a note on BA Certifications
Project Management Institute (PMI) 3
• Professional Business Analyst (PMI‐PBA®)
• Covers only • Requirements management
International Institute of Business Analysis (IIBA) 4
• Certified Business Analyst Professional (CBAP®)
• More comprehensive• Requirements management• Benefits management • Strategic Analysis• Enterprise Analysis
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From Requirements Analyst to Business Analyst Part 2 and 3 of Agenda
Relationships
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Aspects of Business Analysis
Strategic Analysis – focus is mission and vision – why does the business exist• Goals – general direction• Objectives – specific results
Enterprise Analysis – focus is business architecture – how is the business going to accomplish the strategy • Organization components – functional
departments• Component interactions – workflows
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From Requirements Analyst to Business AnalystParts 4, 5, and 6 of Agenda
Relationships
Relationships Relationships
Relationships
Relationships
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Aspects of Business Analysis ‐ continued
Benefits Management – focus is the business case – justifying changes to the business architecture• Cost‐benefits analysis – initiative
economics• Financial analysis – initiative
comparisons Requirement Management – focus is
solution requirements – needed changes to the business architecture • Project context – scope, budget,
schedule• Analysis Tools – capabilities,
conditions, transitions
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Reaching Out to include Benefits Management
BenefitsManagement
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Benefits Management
Business Case – description and economics
Cost‐Benefits Analysis – internal initiative economics
Financial Analysis – comparative analysis
Benefit Mapping – requirements to benefits and its relationship with Change Management
• business case changes• requirement changes• typically results in needing to update benefits
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Initiative Business Case
Description – issues/opportunities• Strategic Plan• Update Value Proposition• Program Dependency• Compliance• Risk
• Assumptions• Constraints• Dependencies• Resistance
• Impact• Employee• Customer• Process• Technology
Economics• Income stream
• Initial capital• Operating Expense Reduction• Expenses• Savings• Income
• Cost‐Benefit Analysis• Payback Period• Return on Investment• Net Present Value• Benefit Cost Ratio• Internal Rate of Return / Modified
Rate of Return
• Financial Analysis• Comparative Analysis
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Project Name XYZ Initiative $MYear 1 2 3 4 5Annual Opex $ 5,000 $ 4,995 $ 4,989 $ 4,977 $ 4,965
Annual Maintenance $ ‐ $ 1 $ 1 $ 2 $ 2
Initial Capital $ (1,000)
Opex Reduction $ ‐ $ 5 $ 12 $ 23 $ 36
Expense $ (1) $ (1) $ (3) $ (3) $ (3)
SavingsBad Credit Loss $ 50 $ 50 $ 100 $ 100 $ 100
Workforce $ 6 $ 6 $ 13 $ 13 $ 13
Income $ 250 $ 250 $ 500 $ 500 $ 500
Net $ (1,000) $ 305 $ 311 $ 621 $ 633 $ 645
Cumulative Net $ (695) $ (384) $ 237 $ 869 $ 1,514
Income Stream
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Cost‐Benefit Analysis
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Cost‐Benefit Analysis 5
Payback Period (PP) – how long will the initiative takes to recover the initial capital investment (inflow = outflow)
Return on Investment (ROI) – what is the total undiscounted gain (limited to one year initiatives due to no discounting of future money)
Net Present Value (NPV) – what is the total discounted gain (multiple years with discounting of future money)• EXCEL function NPV calculates only Present Value (PV) • Initial Capital Investment needs to be subtracted from the EXCEL function
result
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Cost‐Benefit Analysis
Benefit‐Cost Ratio (BCR) – business benefits divided by initiative initial cost• For every unit of currency, how much currency is returned• Multiple year initiative with discounting of future money
Internal Rate of Return (IRR) – what is the initiative breakeven discount rate that results in a net present value (NPV) of zero• Multiple year initiative with discounting of future money• Used to compare with a hurdle rate determined by executives • IRR overstates reinvestment that is corrected by Modified Internal Rate of
Return (MIRR)
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Cost‐Benefit Analysis Summary
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Financial Analysis 6 – comparative analysis
Compare two initiatives at a time based on business case measurements
Initiative A
Imitative B
InitiativeC
InitiativeD
Initiative A
Initiative A
InitiativeA
Initiative D
InitiativeB
InitiativeB
Initiative D
Initiative C
InitiativeD
Initiative D
Evaluating, Comparing, and Ranking Initiative
• Portfolio Management evaluates and compares all proposed projects two at a time based on information from their business cases
• Portfolio Management then ranks the initiatives by the desirability frequency of each initiative
• Note the process is competitive; only top ranked initiatives are funded
Frequency2
Frequency1
Frequency0
Frequency3
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Requirements Traceability – a baseball analogy
Business Needs
Stakeholder
Solution
Transition
Requirements traceability is a project mitigation tool for preventing scope creep by controlling change
To stay within project time and money constraints, BAs must be able to link• business needs to stakeholder
requirements • stakeholder requirements to
solution requirements • solution requirements to
transition requirements Project success is achieved when
realizing the project scope within the schedule and budget
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Benefits Mapping – a baseball analogy
BusinessValues
Stakeholder
Solution
Transition
Benefits mapping is a business tool for ensuring requirements link to their potential business value• increases in revenue,
customer satisfaction, flexibility, compliance
• decreases in cost, liability, risk
Business success is achieved when realizing benefits in the form of business goals and objectives
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The Wave of Change
Strategic PlanValue PropositionDependenciesCompliances
AssumptionsConstraintsDependenciesResistance
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Change Management – impact to business benefits
Project Business Case • strategic direction may no
longer be valid• lower ranked projects may now
be more desirable Solution Requirement Changes
• specific benefits no longer valid• cost‐benefit analysis no longer
favorable Corrective Action
Recommendations• project changes• cancelation
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Mindmap of Webinar Agenda
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From Requirements Analyst to Business AnalystSMART Information Sources
Relationships
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From Requirements Analyst to Business AnalystPart 7 of Agenda
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Wrap‐up ‐ back to the elevator, but with a business focus
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But first a note on the SMART 7 Format and it’s Source Links to Benefits Management
Specific – what/where: issues, opportunities, compliance, global, regional, state‐wide, local
• Info Source: business case description Measured – how much (unit): currency ($), survey rating
(1‐10)• Info Source: business case economics – cost‐benefit
analysis indicators Achievable – who: proven technology, saving/revenue
confirmed by stakeholders as realistic• Info Source: business case description
Relevant – why: contributes to the strategic plan, executive policy, government compliance, industry standard, consent decree, audit
• Info Source: business case description Time‐bound – when: this year, over 2 years, 3 years, 5
years • Info Source: economics – Income stream
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Benefit Management Focus(BA Response – Private/Public Sector Discretionary Projects)
“I’m working on a global opportunity that is adding $20M in revenue to the business in the next 3 years. This work is aligned with our strategic plan and confirmed by the stakeholders.”
“I’m working on a local issue that is saving the business $10M over the next 5 years. This work is aligned with our strategic plan and confirmed by the stakeholders.”
“I’m working on a state‐wide issue that is expected to increase constituent satisfactionfrom a survey rating of 4 to 9 by the end of year. The team is enhancing the usability of our public products and services to be aligned with the stated direction issued by our elected/appointed officials.”
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Benefit Management Focus BA Response(BA Response – Private/Public Sector Nondiscretionary Project)
“I’m working on a regional compliance issue that is ensuring that the business is avoiding $5M in U.S. government fines, possible litigation and even incarceration by being aligned with new federal/state laws effective next year. This work is aligned with our executive policyto always be in compliance with existing laws.”
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Better Result of the Elevator Speech
“So, what are you working on these days?”
The BA responds by citing the business benefits of the work, not the solution requirements
Gains the executive’s interest May now invite the BA for an
extended conversation in the executive’s office
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Walk‐Away with These Questions
What are my current responsibilities as a business analyst?
Does my career path as a business analyst include benefits management?
Do I aspire to include benefits management in my job as a business analyst?
How do I acquire the skills?
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From Requirements Analyst to Benefits Analyst
For a webinar recording and a copyof the presentation, see Webinars @
http://www.modernanalyst.com
To contact the presenter or obtain copy of the presentation, see Contact US or Services @
http://baquickref.com
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References
1. http://www.modernanalyst.com/Resources/Articles/tabid/115/ID/3869/The‐Elevator‐Speech‐for‐the‐BA.aspx
2. https://en.wikipedia.org/wiki/Requirements realisation managment
3. https://www.pmi.org/4. https://www.iiba.org/5. https://en.wikipedia.org/wiki/Cost%E2%80%93bene
fit_analysis6. https://en.wikipedia.org/wiki/Financial_analysis7. https://en.wikipedia.org/wiki/SMART
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