Business analysts, also known as management analysts, work for all kinds of businesses, nonprofit organizations, and government agencies. While job functions can vary depending on the position, the work of business analysts involves studying business processes and operating procedures in search of ways to improve an organization's operational efficiency and achieve better performance. Business analysts work with management to devise new or enhanced systems and work processes designed to reduce or eliminate inefficiencies, reduce costs, and improve the firm's competitive position in the market.
- Business analysts are responsible for working with management to improve operating procedures, reduce costs and inefficiencies, and achieve better performance.
- All kinds of businesses, organizations, nonprofits, and government agencies employ business analysts.
- Most entry-level business analyst jobs require at least a bachelor's degree.
- Employers looking for a senior business analyst frequently require candidates to have a master of business administration (MBA) degree or additional certification.
Who Employs Business Analysts?
Many large organizations have business analysts on staff who continuously monitor operations and devise and implement process improvements. Business analysts also work as external consultants, providing targeted analysis and recommendations to organizations on a short-term contractual basis.
Business analysts who work in consulting firms often specialize in an industry, such as health care or manufacturing, or develop expertise in a specific business area, such as supply chain management or information systems management. Organizations also hire business analysts for assistance in planning and executing a major business project, such as moving into a foreign market or developing an e-commerce strategy.
According to the 2019 International Institute of Business Analysis' global salary survey, the average annual salary for women business analysts was $74,188 and $72,965 for men business analysts.
A Business Analyst's Career Path
Many business analysts begin their careers working in entry-level business positions related to their undergraduate degrees. Work experience provides young professionals with a better understanding of how businesses operate from the inside, which is invaluable to the work of analyzing and improving business processes. With sufficient experience and good performance, a young professional can move into a junior business analyst position. Some choose instead to return to school to get master's degrees before beginning work as business analysts in large organizations or consultancies.
With greater experience and expertise, business analysts can move into more senior positions with greater responsibility and influence. A senior analyst may be responsible for a team of professionals planning and executing a business process redesign (BPR) or another complicated project. The best-qualified, top-performing business analysts can move into high-level management positions in companies and other organizations. High-performing consultants may rise into leadership positions in their firms or strike out on their own to start new consultancies.
A Business Analyst's Educational Qualifications
Most entry-level business analyst positions require at least a bachelor's degree. However, since there are few undergraduate programs in the United States designed specifically to train business analysts, most employers look for job candidates with degrees in business disciplines. Subjects such as business administration, business analytics, and business information systems are good options for jobs in this field, as are business degrees in operations management, human resources, logistics, finance, and accounting.
Many employers hiring a senior analyst or consultant position—or looking to promote within the organization—look for candidates who hold a master of business administration (MBA) degree or another relevant business degree. It's not uncommon for junior analysts to return to school for master's degrees after several years of experience working in the field. However, a master's degree is not generally an absolute requirement for advancement. Sufficient work experience, specialized knowledge, and a record of high performance may suffice for a job candidate who does not hold a master's degree.
The U.S. Department of Labor projects demand for business and management analysts will grow 14% from 2018 to 2028, much faster than average for all occupations due to the need for organizations to control costs and improve efficiency.
Two major certifications figure prominently in the business analyst profession: the Certified Business Analysis Professional (CBAP) and the Certified Management Consultant (CMC).
Certified Business Analysis Professional (CBAP)
The International Institute of Business Analysis offers the Certified Business Analysis Professional (CBAP) designation to analysts with at least 7,500 hours of qualifying work experience in the previous 10 years.
To obtain the CBAP designation, candidates must also complete at least 35 hours of professional development training in the last four years and pass a written exam. As this certification is designed specifically for experienced professionals, it is generally considered a qualification for career advancement into more senior positions in the field.
Certified Management Consultant (CMC)
The Institute of Management Consultants USA administers the Certified Management Consultant (CMC) designation, a professional certification for experienced business analysts who work as consultants. Basic certification is available to candidates who have bachelor's degrees, three to nine years of qualifying management consulting experience, and at least five satisfactory evaluations from past consulting clients.
To obtain the CMC designation, candidates must pass an oral exam and a written exam. This certification is considered a qualification for senior analyst positions in consulting companies and other organizations. Independent consultants also pursue the certification as a marker of professionalism and experience.