You have heard the term “business analysis” or even “business analysts.” Business analysis sounds important, but is it something that you need as a small business?
You are not sure if you should add it to your list of worries or if it is just a fancy phrase to help the big companies sound official.
Business analysis is actually a crucial aspect of any company. To some extent, as a small business owner, you have more likely than not already participated in the process, even if you didn’t notice.
What Is Business Analysis?
What do you think of when you think of the word “analyze”? If you can imagine an analysis by thinking back to high school or other courses, you are on the right track.
An analysis is the process of examining what is in front of you (in this case, your business).
You identify what exists and then what might be needed. There is obviously much more to it than that, but that is a basic definition to get us going.
If you really want a geeky answer and are feeling academic, check out Bloom’s Taxonomy. You’ll be able to understand his view on analysis as part of a larger view on how people think and process ideas. Warning: it really is geeky/academic, so if you are not in the mood, pass on the link. 🙂
Many perceive business analysts as being part of a bigger corporate structure. But having a business analyst assist in your small business is equally important.
Why? Analysts help determine where you are and where you are going.
They help you develop a plan and use it as a road map for your future. They help you to reach your much-needed goals for business growth (and income!).
Acquiring a Business Analyst
Sometimes there are business analysts right within your organization capable of doing the job. Other times, you might need to pull in a contractor to help you with your analysis.
Small business owners usually have hectic schedules managing clients and ensuring delivery of goods and services. It can be difficult to step back and devise a more strategic approach on how to grow their businesses.
But if you have a qualified business analyst (even if that is not what he or she is currently doing) within your organization, by all means, keep the job home-bound, so to speak.
If you do not have a business analyst within your four walls (after all, we are speaking of small businesses here), that is ok. That doesn’t mean you are any less of a business.
Look at it this way: it means that you have economized the use of your business staff in other areas. So either way, whether you already employ a business analyst or you need to contract one, you are ready for that next step.
We have already mentioned that strategy is a part of the definition of business analysis. Sometimes, it helps to hire a business coach or business strategist to help you get started with that analysis.
These coaches/consultants/strategists have experience in understanding small businesses and their needs. So even if you hire someone who is not an official business analyst, you can still be in the process of starting down that road.
Fortunately, here at GrowMap, there are services to help you with that strategy. Go ahead and check out the GrowMap Services page.
Don’t let yourself become overwhelmed by all of the wonderful opportunities. Rather, focus on Gail’s availability as your business strategist. Checking out GrowMap’s services would be an unabashed wonderful first step for you and your business.
Role of a Business Analyst
A business analyst can determine what small business owners can do to increase their return-on-investment (ROI).
This situation is where you really see the advantages of involving a business analyst in your business. Check out this article for additional information about business analysis.
There are several forms of business analysis. If you want to stay ahead in the game, it’s important to know them. You need to be able to identify the changes that will affect your company’s stability and performance.
Business analysts play a vital role in a company. They can influence strategic planning, provide technological analysis, and analyze economic models.
If your business is small, it’s impractical to have numerous people handling your company’s analysis. Since analysis can take a toll on your financial resources, it’s a good idea to limit the number of people who perform business analysis for you.
Benefits of Business Analysis
When effective, your business analysis allows you, your managers, and any other stakeholders, to ensure that accurate information is circulated and understood by everyone on their team.
Having accurate information permits the team to work together in an organized manner. By doing so, there is the opportunity for better ROI and for you to achieve your objectives.
With today’s modern technology, business analysis software enables managers to stay on top of the constantly changing shopping trends of consumers.
This component alone is a valuable addition to any analysis. It is not required, but certainly desirable (and helpful!).
Managers can also tweak their marketing strategies and plan for projected future trends.
In addition to a business analysis, you should perform a financial analysis, even if you own a small business. Your financial analysis should include budget analysis, inventory costs, cash flow, balance sheets, and profit and loss statements.
An effective financial analysis will help to provide information to allow for the streamlining of operations. It’s imperative to understand your primary marketing areas to increase revenue and cut waste.
In Conclusion
Regardless of industry, the business world is a competitive market. Small business owners cannot thrive without a complete understanding of their customers and their spending habits.
Business analysis ensures that the decisions you make are beneficial for both yourself and your customers. It also diminishes any unrealistic expectations that could lead to loss of revenue down the road.
Too much to consider right now? That’s ok. Let’s keep it simple. Just consider your business strategy for today so you can understand what to do tomorrow. And remember, if you need help working through the fog, GrowMap has services that are right up your alley and ready for you.
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Deborah Anderson wears many hats and her addiction to acquiring knowledge. From professional training as a sound engineer at the Los Angeles Film School, to graduating summa cum laude in software architecture, and then on to becoming the director of Information technology at the high profile Bel Air Investment Advisors, she often comments that she is only just beginning. She enjoys sharing her knowledge discoveries with her readers and is always ready to offer a helping hand.