The Importance of Business Analysis for a Project Manager

by Debra Kraft

An ever evolving market environment drives a continual need for change, such as to introduce new products, implement new technologies or develop new or more efficient processes. The need for change in turn drives the need for projects to make change happen. Change for the sake of change, however, does nothing to move a business forward. Project managers, or PMs, who can perform effective business analyses can implement changes that have a direct, positive effect on a company’s bottom line.

Connecting the Dots

Business analysis connects the dots between strategy, processes and information systems. A project might touch only one piece, but can affect the others. Introducing a new product affects strategy and business processes. Redeveloping processes can have an impact on databases and other information technology department services. The reverse is also true -- implementing new databases or other information technology services can have an impact on business processes. A PM should be able to connect the dots between what the project is intended to do, and what it can affect.


Business analysis tools address risk analysis, change management, stakeholder analysis and communication plans. All of these activities are critical to effective project management. Risk analysis must be performed to determine any negative effects the project could have on the business. Without effective tools, some risks might remain hidden until a problem emerges. Similarly, effective stakeholder analysis and communication planning tools are needed to get projects rolling in the right direction.


Business analysis is about recognizing the needs of the business and finding the best ways to meet those needs. PMs work with project stakeholders to understand what business needs must be met, and how other aspects of the business community can be affected, directly or indirectly, when the project is completed. By performing a business analysis with all stakeholders, PMs get the opportunity to see the project based on business impacts rather than just tasks to be completed. In contrast, if a PM ignores stakeholder perspectives, the outcome of the project can miss desired objectives, or even bring more harm than good.


Communicating effectively with the stakeholder community is a critical aspect of successful business analysis. A PM should be able to bridge communication gaps between stakeholders of different business backgrounds and functions. Every department in a company has its own language, expressed through acronyms or terms known to other professionals in their own areas of expertise, but not to other disciplines. Finance professionals don’t always understand engineers, who, in turn, might not "get" the language of logistics. A PM who can gain a thorough understanding of all stakeholders’ needs despite communication gaps stands the best chance for successful business analysis.

About the Author

A careers content writer, Debra Kraft is a former English teacher whose 25-plus year corporate career includes training and mentoring. She holds a senior management position with a global automotive supplier and is a senior member of the American Society for Quality. Her areas of expertise include quality auditing, corporate compliance, Lean, ERP and IT business analysis.

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