Is it hard to become a business analyst?

Like many positions in the IT industry, there is no standard path to becoming a business analyst. Most people pursue analytical degrees and certifications before becoming business analysts, but it’s not obvious how difficult the path is.

In short, becoming a business analyst is harder than getting most operational jobs, but easier than getting most technical jobs. For example, it’s harder than becoming a designer but easier than becoming a developer. In fact, business analysis is often defined as the “translator” between business and technology.

Let’s take a look at some of the reasons why.

Becoming a business analyst requires a bachelor’s degree

Most job postings for a business analyst require computer science, process engineering, economics or study in a related field. That’s because these degrees are guaranteed to have immersed students in analytical processes that flow nicely into business analysis.

With that said, I have seen friends land first jobs in business analysis without a relevant degree. This is because they got experience in analytical fields through internships, side projects, and small certifications like the ones we offer on this website. In a nutshell, employers want to see that you have what it takes to analytically approach their business.

Earning stripes with a degree

After all, the job is essentially to gather requirements through a series of questionnaires and conversations. BAs then use those requirements to help guide product developers in the right direction. They need the analytical thinking necessary to understand complex relationships and moving parts.

That’s why, especially for first jobs, junior business analysts need a diploma to prove they have what it takes, or at the very least a start. But what about for a second job? Let’s look at that now.

Several years of experience in a related field

Nevertheless, junior business analyst positions are hard to come by. Unlike with other professions, employers have a hard time extracting value from junior-level employees. The main reason for this is a BA’s critical role in cross-department and cross-hierarchical communication. Whether junior or senior, business analysts need to be able to communicate with stakeholders of all levels. It’s simply less common for employees in their first job to be able to do so.

Those with a few years of experience, even if its not directly in business analysis, have a higher chance of succeeding in this communication. They learn the subtle ways to speak and handle hierarchy and authority, as well as how to create relationships with key colleagues.

In the middle

So yes, this dynamic makes it hard to become a business analyst. I originally compared to designers and developers. A designer, for example, could easily start in a junior position and produce valuable results for his/her team. The nature of the work allows for that. Junior designers can create mockups and first drafts.

On the other hand, it’s even harder to start as a junior developer than as a junior business analyst, especially in a company where the expectations of quality in software production cycles is high. And in most companies it is. You need to work fast and you need to produce results with few to no mistakes.

It’s tough, but doable.

You Have to Speak Data

A common misconception is that business analysts are separate from data analysts. The reality is much different. BAs need to understand data to elicit requirements, quantify solutions and their results with KPIs, and be able to analyze big volumes of data to reach their goals.

To get started, you should consider getting an intro-level book. I wrote one that you can get for free because you shouldn’t pay for essentials–it’s oriented towards practical skills unlike most other you’ll find.

You have to speak the IT & business languages

One of the more intimidating challenges with the BA position is learning two departments’ worth of industry language. You need to understand business metrics like monthly active users, churn rates, unit margins, gross margins, fixed vs variable costs, and many others.

On the flip side, you need to understand tech terminology such as a functional and non-functional requirements, input vs output devices, systems administration, access points, imperative vs declarative coding, agile, and more.

Translating: a key task

Your role is to translate, which means being reasonably fluent in the jargon on both business and tech sides. This may sound tough, but I believe it can be one of the easier parts in becoming a business analyst. While many of these terms may seem complex, they’re just an official way of identifying intuitive ideas.

Function requirements just means “what something can actually do,” while non-functional requirements simply means “what goals can it reach.” We give the two names in order to make them concrete and facilitate communication, but they’re ultimately intuitive ideas. Let’s take a look at some terms from both sides.

Business terms to know to become a business analyst

First 6

1. Monthly active users – the number of users who perform some fundamental action (purchase, consumed x minutes of content, etc) on your website, application, or in your store
2. Churn rates – the amount of customers that return for a second purchase. It’s represented as a percent of the total (business people love ratios): [customers leaving after x periods/total customers in that period]
3. Unit margins – the amount of profit a company makes per unit. This is a calculation purely on the cost directly associated with the item. For example, if you sell cars for $10 and the cost of the plastic and paint to make those cars is $4, then you have a $6 (or 60%) unit margin. This is important because business decisions often get made on unit margins.
4. Gross margins – unit margins added together. This is a number on the profit & loss statement (learn more about financial statements for BA professionals on the website).
5. Sales conversion rate – this is the number of customers who purchase over the total number of visitors. If you have ever worked in retail, this number is why branch managers hate people who come in simply “to look.”
6. Opt-in rate – the number of people who actively decide to receive more information from the company, either by clicking a button online or at the time of purchase in shop

Second 6

1. Lifetime value – the value that a member or customer brings to the company over his/her lifetime.
2. Customer lifetime – a calculation of the normal “life” a customer usually has at a given store. To give some perspective, supermarkets have very high lifetime values, resorts have very low lifetime values, and e-commerce has moderate lifetime values.
3. Average order value – the value that one customer brings when he/she makes a purchase. This ultimately depends on the total number of items purchases.
4. Acquisition cost – the cost a company spends to get 1 customer
5. Customer profile (or persona) – the demographic explanation of a potential customer. For example, Tommy Hilfiger targets 18-24 and 25-32 year olds with average incomes who work in traditional service jobs and technology.
6. Elicitation – gathering requirements (very important term for BAs)

There are tons more terms to learn, and we’ve got some products coming soon. You’ll be impressing your coworkers and boss in no time.

Technical terms to know to become a business analyst

1. Functional requirement – behaviors a product needs to perform. For example, the wheel must role.
2. Non-functional requirement – non-behavioral goals a product must achieve. For example, the wheel must turn at 1 million RPM without exploding
3. Requirement analysis – the gathering and interpretation of, and the decision-making on requirements
4. User story/story mapping – the high-level path that a potential customer takes from first contact to exiting a website/shop. For example, a customer searches tires online, she sees an ad and a high-ranking article from Tires4You, she sees a simple webpage with 3 options, finds her tire, goes through a checkout portal, purchases tires, exits the window, (and receives the tire on time).
5. UML – Unified Modeling Language. It’s more like guidelines than a true coding language. You can learn more about it here.
6. Access point – a virtual place where one computer accesses a network
7. Network – a group of computers working together
8. Markup – the simplest visual representation of a future product, website, or application
9. Binary vs high-level – binary means “yes” or “no,” or in the computer world, “1” or “0.” It’s the lowest-level (fundamental) form of coding. Other languages are called “high-level” because they are easier for humans to understand
10. Object-oriented – programming in which programmers define data and the operations used to manipulate it. They define the objects.

BA positions increasingly require hard skills in data analysis

Business analysts today need hard skills in data analysis. The reason for this is that data as a topic, as well as data-gathering technologies, are more accessible every year. As some say, data is the currency of the 21st century.

At the same time, data familiarity and savvy are still quite limited. Many business analysts have trouble working with business intelligence and finance teams because they lack these technical, skills.

You should see this as an opportunity. The need for data skills may seem to make becoming a BA more difficult. I see it as an easy way to set yourself apart. You can easily learn the basics of data analysis through simple courses and move your way into a BA role.

I had a great teacher on the job in a financial analyst position. I could have gotten a certificate from a recognized institution in data analysis, but it costs $1000s for course, and you always seems like you learn very little.

That’s why I made courses on Analyst Answers affordable. It doesn’t make sense to charge $1000s for skills, especially on skills that will make the world a better place for everyone.

It’s hard to become a business analyst by internal hire

If you start at a company hoping to transfer internally into a BA role, it may prove to be harder than you think. According to the US Bureau of Labor Statistics, the majority of management analysts (another term for business analyst) typically amass a number of years of experience before moving into the role.

This is largely because once you have established yourself in an “operational” role, it’s quite difficult to make the transition into a role that must challenge the management and its requirements. Like many consultants, business analysts come in from outside to challenge the way the company works.

Conclusion

Becoming a business analyst is harder than getting an operational role, but easier than getting a technical role. One more time, the reasons are that you need:

• A bachelor degree
• Several years of experience
• To speak two languages: business and tech
• Data skills
• To move companies, not be internally hired