BAaaS: It’s time to start talking about business analysis outsourcing

outsource1Yes, I know, your automatic response to the idea of outsourcing business analysis is that it cannot be done. Conventional wisdom tells us that we need control of our business requirements, that the business analyst must develop a relationship with the business, be a subject matter expert and that constant interaction with the business is required.

This view is supported by Kathleen Hass in her book, “Professional Business Analysis, Breaking the Cycle of Challenged Projects.” She says:

“IT managers are realizing that technical skills can be relatively easy to outsource, but that they cannot abdicate control of their business requirements.  In virtually every organization, the elevated leadership role of the business analyst is beginning to shape the future of business transformation.”

Hass explains further in her book that Business Analysts are taking more of a leadership role within the organisation.  As the move in IT goes from efficiency to business effectiveness, the Business Analyst becomes the central figure on the project team who is bilingual in both the business and technical languages. The Business Analyst must have a broad range of knowledge, skills, and competencies. If this liaison is not in place between the business and IT departments, poorly defined requirements result in gaps between what the business needs and what is delivered.

That’s a strong argument against outsourcing business analysis, but I believe that outsourcing business analysis is a viable option if the conditions are right. Yes, it’s much easier to outsource technical skills than business analysis, because the business analyst needs to interact with the business on a continuous basis.

But, ask yourself these questions:

  • How many contractors do you have in your BA team at the moment? What is your contingency plan to retain your IP if (no, when) they leave suddenly?
  • Do your BA’s have the skills to “shape the future of business transition” or are they business requirements scribes?
  • How many times have you interviewed a great BA, but did not offer them the job, simply because the asking price is too high?
  • Are you hiring more and more junior BA’s, with an increasing investment in their development?

The business analyst job market has been a bull market for quite some time. There is a high demand for business analysts and their prices are rising. The response has been to use short term contractors or employing junior business analysts, combined with a mentorship program. In addition, most BA’s are subjected to a barrage of offers from recruiters, resulting in a very high staff turnover rate in BA teams.

This is diluting the effectiveness of an in-house BA team and creating the conditions that are conducive to outsourcing.

Why do organisations outsource?

The key factors which lead organisations to outsource parts of their business process are:

  • Lack of expert-labor in some portions of the business process 
  • Availability of cheaper labor, whilst not comprising on the quality of output 
  • Ability and feasibility to concentrate on the other crucial business processes

Can these factors be applied to business analysis? Most definitely – the right conditions for business analysis outsourcing includes both your current BA capability and your relationship with the potential outsource partner.

Current BA capability

Your in-house BA’s are becoming a bottleneck and:

  • You have a high ratio of contractors in your BA team.
  • You do not have the resources or skills within your current team to manage the demand.
  • You do not have the long term capacity or need to hire a full time business analysis team.

Relationship with the outsource partner

Also, your relationship with the outsource partner must be based on trust and:

  • You have worked with the outsourcer in the past and enjoy an existing sound working relationship.
  • The outsourcer has demonstrable knowledge of your business and/or your industry.
  • The outsourcer excels at business analysis, and thus guarantees better quality than could be sourced in-house. 

A long time ago, I worked for a CIO that used to say that an outsource partnership will only work if both parties benefited from the relationship, more than just financially, but also in terms of effectiveness, organisational growth and culture. That’s very true in the case of business analysis outsourcing as you are entrusting someone else with the most critical part of your SDLC – requirements management. Which means giving someone else in-depth access to your business problems and goals.

baas1

That is why I prefer the concept of Business Analysis-as-a-Service or BAaaS (I don’t take credit for this term, I’m just borrowing it and changing the meaning a bit) – where both parties work together to create a mature BA team, using a combination of insourced and outsourced resources. This provides for a range of services, depending on the need, and can include:

By striking a balance in how you outsource business analysis, you can:

  • Get best in the industry to support your in-house team and help define or improve the business analysis framework within the organisation.
  • Have the outsourcer mentor and develop any under-skilled team members.
  • Gain access to additional capacity when you need it.
  • Keep competitive business knowledge and intellectual property in-house.

 

 Next up is an engagement model for BAaaS – Stay tuned……..

2 comments for “BAaaS: It’s time to start talking about business analysis outsourcing

  1. Maria
    April 1, 2014 at 9:48 am

    Good article.
    After 15 years of experience as a BA, I see more and more the likelihood to BAaaS, and in fact I have seen organisations completely outsourcing the BA team, however unsuccessfully for the first 2 years and then moved to an insource/outsource model.
    Many organisations already have a hybrid model in place.

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