About the Author

Kathleen Hass is the Project Management and Business Analysis Practice Leader for Management Concepts. Ms. Hass is a prominent presenter at industry conferences and is an author and lecturer in strategic project management and business analysis disciplines. Her expertise includes leading technology and software-intensive projects, building and leading strategic project teams, and conducting program management for large, complex engagements. Ms. Hass has more than 25 years of experience in project management and business analysis, including project portfolio management implementation, project office creation and management, business process reengineering, IT applications development and technology deployment, project management and business analysis training and mentoring, and requirements management. Ms. Hass has managed large, complex projects in the airline, telecommunications, retail, and manufacturing industries and in the U.S. federal government.

Ms. Hass’ consulting experience includes engagements with multiple agencies within the federal government, such as USDA, USGS, NARA, and an agency within the intelligence community, as well as industry engagements at Colorado Springs Utilities, Toyota Financial Services, Toyota Motor Sales, the Salt Lake Organizing Committee for the 2002 Olympic Winter Games, Hilti US Inc., The SABRE Group, Sulzer Medica, and Qwest Communications. Client services have included maturity assessments, project quality and risk assessment, project launches, troubled project recovery, risk management, and implementation of program management offices, strategic planning, and project portfolio management processes.

Ms. Hass earned a B.A. in business administration with summa cum laude honors from Western Connecticut University.

Chapter 1

The Emerging Role of the Business
Analyst in Strategic Planning

In This Chapter:

• Strategic Planning in Organizations Today

• The Business Analyst’s Role in Strategic Planning

To respond to the never-ending demand for new products and services, executives everywhere are adopting professional business analysis practices to improve their ability to establish and execute strategy. At the strategic level, business analysis best practices aim to formulate the best business strategies, select projects to achieve those strategies, and increase the value project deliverables bring to the business.

Strategic Planning in Organizations Today

Executives are learning that to set the most favorable vision and strategy, they need to dedicate a significant portion of their time and energy to the formulation, execution, continuous monitoring, and refinement of strategy. To formulate and execute a well-formed strategy, leadership teams must anticipate market needs, exploit opportunities, identify threats, and make decisions that support their corporate objectives—a tall order.

For this discussion, it is appropriate to look to the foremost experts in strategy formulation, execution, and measurement, Robert S. Kaplan and David P. Norton. Robert Kaplan is the Marvin Bower Professor of Leadership Development at Harvard Business School and cofounder and chairman of BSCol (Balanced Scorecard Collaborative). David Norton is cofounder, president, and CEO of BSCol. Kaplan and Norton have coauthored several publications on strategy, including The Balanced Scorecard: Translating Strategy Into Action (Harvard Business School Publishing, 1996), The Strategy-Focused Organization: How Balanced Scorecard Companies Thrive in the New Business Environment (Harvard Business School Publishing, 2000), and three articles on the balanced scorecard in the Harvard Business Review. Through their efforts, executives are gaining knowledge of how to combine the expertise and principles of the strategy-focused organization with corporate performance management methods and techniques. Their theories, recommendations, and techniques appear throughout Chapters 1 and 2.

So how are strategies formulated today, and what is the role of the business analyst? The executive leadership team alone cannot effect the transition to a strategically focused organization. The information, process, tools, and facilitation that enable the organization to shift focus and become strategically driven are largely provided through the efforts of senior business analysts.

Before setting strategies, the leadership team needs to have up-to-date information regarding the competitive environment within which their business operates. Strategic planning processes begin by conducting research, competitive analyses, benchmark studies, and the like. The business analyst provides critical information to the executive team as an input to strategic planning discussions. In addition to critical information, the business analyst and senior managers also develop and use processes and tools during facilitated strategy meetings, and later during project selection and prioritization sessions, as well as ongoing program and project reviews. Specific activities the business analyst performs to enable the leadership team to formulate and execute strategy fall into four categories:

•   Conducting research and presenting findings

•   Establishing strategic goals and themes

•   Selecting change initiatives

•   Measuring progress over time

Conducting Research and Presenting Findings

For business requirements and goals to convert into innovative solutions that truly reflect the needs of the business and bring wealth to the organization, strategic planning and strategic goal-setting processes alone are not sufficient. To strongly link project selection to the organizational vision, those activities must be combined with business analysis—a comprehensive examination of business needs, environmental considerations, business opportunities, and business problems.

To establish the best direction in terms of vision, strategy, and goals, business analysts provide executives with an understanding of the current state of the industry and of critical market threats. In addition, analysts determine the competitiveness of their organization’s products and services, any impending innovations on the horizon, national and global marketplace pressures, and the current state of their business processes, organizational capabilities, and supporting technology. The business analyst may also conduct a competitive analysis to determine the current state of the organization in relationship to its competition, or a benchmark study of organizational processes and practices used by leaders in the industry.

After studying industry trends outside the organization, the business analyst turns inward to conduct an analysis of the organization relative to its competition. The business analyst then typically prepares a report describing study methods and results, proposing various business problems and opportunities for consideration, and suggesting ways the organization might close the gap with competitors. This report may include information garnered from:

• Investigating, comparing, and contrasting the organization’s current strategy versus industry trends, marketplace pressures, and competitive threats

• Assessing the current state of the organization’s technology structure, and strategies to ensure that structure aligns with the business vision

• Identifying current business problems and determining their root causes

• Assessing whether current internal processes and organizational capabilities sustain the current competitive advantage and are profitable and efficient, and whether they may help seize new competitive advantages

Establishing Strategic Goals and Themes

The executive leadership team typically defines the organization’s future in terms of vision, mission, and strategic goals. Norton suggests that in order to execute strategies organizations must convert strategic goals and objectives into strategic themes. ¹ Once the senior business analyst demonstrates to the executive leadership team that he or she has a grasp of the critical information needed to devise future strategies, the senior team then may enlist the business analyst to facilitate strategy-forming sessions to establish strategic goals and themes. Strategic themes reflect goals related to financial performance, customer value, business operations, and the capabilities of the workforce and other corporate assets. Refer to Table 1-1 for an understanding of the relationship between strategic goals and strategic themes.

Table 1–1—Strategic Goals and Themes

Selecting Change Initiatives

Once strategic themes are fully developed, the next step is to use the themes to select and prioritize change initiatives needed to achieve the strategies set by the executive leadership team. Change initiatives are carried out through programs and supporting projects. Projects make change happen. Projects might include training and retooling the current workforce, developing new IT-enabled business systems, reengineering current business processes, or establishing new business units. Projects are accomplished through an effective portfolio management process, the subject of Chapter 2.

Measuring Progress Over Time

So how do we measure progress along the way? In addition to selecting and prioritizing strategic projects, business analysts need to convert strategic themes into an organized, actionable, measurable framework to provide a guidepost for measuring progress along the way. Norton and Kaplan introduced the corporate scorecard as a performance measurement technique in their book, The Balanced Scorecard: Translating a Strategy into Action. ² Many organizations are developing corporate strategic scorecards to frame strategic themes and measure progress. As an outgrowth of the strategic plan, the business analyst facilitates the conversion of strategic themes into strategic scorecard elements—usually categorized into financial, customer service, internal operations, and learning/innovation groups—and helps executive leadership teams build the measures. ³

Repeating the Planning Cycles

Strategic plans will change as the competitive landscape changes. Strategic goals, themes, and measures are dynamic as well. Therefore, the business analyst and senior managers meet with the executive leadership team repeatedly during ever-tighter planning cycles to rigorously monitor progress and make course corrections as necessary. The bar for adding business value is raised for every planning cycle as competition strengthens.

The executive team cannot perform these rigorous and time-consuming strategic planning activities without the help of senior business analysts who can bring together all the elements that go into good strategy and good execution. Elements include:

•  The options and the relevant costs and benefits of proposed opportunities

•   The project resource capacity and expertise needed to deliver a quality business solution

•    The impacts of change initiatives on the organization as a whole and on specific business units

•    Methods for measuring progress toward the expected business value

•    Guidance for formulating a course of action and project-related direction in terms of goals and constraints

•    Project reviews for ongoing management oversight and required course correction, including project termination, when warranted

•    Measurement of the actual value added to the enterprise

The Business Analyst’s Role in Strategic Planning

Not all business analysts are involved in all aspects of strategic planning. It is a complex and important process, and it should be entrusted to the most senior and expert business analysts. In many organizations, business analysts do not yet participate directly or even indirectly in strategic planning, although this trend is changing. More and more senior business analysts are invited into the boardroom to provide vital information to the strategic planning team. Even if an organization doesn’t ask its business analysts to participate in the strategic planning process, business analysts and project managers should still focus on the organization’s strategic goals to ensure that new initiatives fit into those long-term plans and to help build and manage the business case and other relevant information about new project opportunities.

To evolve from an internal business and technology consultant to a member of the executive leadership team, the senior business analyst needs to fully understand strategic planning processes and portfolio management practices to make project selection decisions that align with greater organizational strategies. The business analysis activities required to determine which projects are most likely to achieve business objectives are conducted during the enterprise analysis phase of the BSLC, introduced in Chapter 2.

Endnotes

1. David P. Norton presented “Project Balanced Scorecards—A Tool for Alignment, Teamwork and Results,” at ProjectWorld & The World Congress for Business Analysts Conference in Orlando Florida on November 17, 2005. For more information about ProjectWorld & The World Congress for Business Analysts Conference, visit www.projectworld.com (accessed September 2007).

2. Robert Kaplan and David Norton. The Balanced Scorecard: Translating a Strategy into Action, 1996. Cambridge: Harvard Business School Press.

3. Ibid.