Strategy Analysis

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2015, International Institute of Business Analysis™
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2
AGENDA
• Introduction

• 6.1 Analyze Current State

• 6.2 Define Future State

• 6.3 Assess Risks

• 6.4 Define Change Strategy

Strategy Analysis 3
INTRODUCTION
• Chapter 6 of BABOK v3

• Consists of tasks performed to:

• Analyze Current State: Understand the business need and the context
for change
• Define Future State: Determine goals and objectives. Identify what
needs to change in order to meet those goals and objectives
• Assess Risks: Understand risks and recommend actions
• Define Change Strategy: Identify options for reaching the desired
future state. Determine any transitional states required

Strategy Analysis 4
INTRODUCTION
• Purpose
• Describes the business analysis work to collaborate with stakeholders
to identify the business need, enable the organization to address the
need and align the resulting strategy for change with other strategies.
• Define the future and any transition states needed to address the
business need.
• Discover possible solutions to apply the capabilities of the organization
in order to reach the desired set of goals and objectives.
• Ongoing activity as changes in the business need occurs or new
information results in an adjustment to the change strategy.
• A strategy may be captured in a strategic plan, product vision,
business case, product roadmap or other artifacts.

Strategy Analysis 5
INTRODUCTION

Strategy Analysis 6
INTRODUCTION

Strategy Analysis 7
INTRODUCTION - APPLYING THE BUSINESS
ANALYSIS CORE CONCEPT MODEL
Core Concept Usage in Strategy Analysis
Change Define the future state and develop a change strategy to
achieve the future state
Need Identify and prioritize needs from the current state to
determine the desired future state
Solution Define the scope of a solution as part of developing a
change strategy
Stakeholder Collaborate to understand the business need and develop
change strategy and future state to meet needs
Value Examine the potential value of the solution to justify the
change
Context Consider context of the enterprise in developing a change
strategy

Strategy Analysis 8
6.1 Analyze Current State
6.1 ANALYZE CURRENT STATE
• Purpose
• Understand the reasons why an enterprise needs to change.
• Understand what would be directly or indirectly affected by the change.

• Description
• Change occurs in a context of existing stakeholders, processes,
technology and policies of the enterprise.
• Current state can be described on different levels, from the entire
enterprise to small components of the solution.
• The current state is rarely static while a change is being developed.
Changes to the current state may force alterations in the desired future
state, change strategy or requirements and designs.

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6.1 ANALYZE CURRENT STATE

Strategy Analysis 11
6.1 ANALYZE CURRENT STATE
• Elicitation Results
• Used to define and understand the current state.

• Needs
• The problem or opportunity often launches business
analysis work to better understand these needs.

1.
Inputs

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6.1 ANALYZE CURRENT STATE
• Business Needs
• Problems and opportunities of strategic importance.
• May be identified at different levels of the organization.
• Need to ensure the correct problem is being solved.

• Organizational Structure and Culture

2. • Formal relationships between people.
Elements • Beliefs, values and norms that drive actions.
• Assess if cultural changes are necessary to better
understand and achieve the goals.

Strategy Analysis 13
6.1 ANALYZE CURRENT STATE
• Capabilities and Processes
• Activities, knowledge, products and services, supported
functions and decision making methods that differentiate
the enterprise.
• Capability-centric view: identify innovative solutions
using existing capabilities.
• Process-centric view: improve current activity
2. performance.
Elements
• Technology and Infrastructure
• Information systems.
• Physical components and capabilities.

Strategy Analysis 14
6.1 ANALYZE CURRENT STATE
• Policies
• Guide operations and decision making of the enterprise
and support governance.
• Identify relevant policies that may shape solution scope
or constrain potential solutions to pursue.

• Business Architecture
2. • Understand the context of the current state in order to
Elements recommend changes that provide value.
• Ensure that needs being met by the existing business
architecture continue in the future state.

• Internal Assets
• Identify resources used in the current state.

Strategy Analysis 15
6.1 ANALYZE CURRENT STATE
• External Influencers
• May present constraints, dependencies or drivers on the
current state:
• Industry Structure
• Competitors
• Customers
• Suppliers
2.
• Political and Regulatory Environment
Elements • Technology
• Macroeconomic Factors

Strategy Analysis 16
6.1 ANALYZE CURRENT STATE
• Business Analysis Approach
• Guides analysis of the current state.

• Enterprise Limitation
• Helps to understand challenges within the enterprise.

• Organizational Strategy
3.
• Set of goals and objectives that guide operations,
Guidelines establishes direction and provides vision for the future
and Tools state.
• Implicitly or explicitly stated.

Strategy Analysis 17
6.1 ANALYZE CURRENT STATE
• Solution Limitation
• Used to understand the challenges of the existing solutions
within the current state.

• Solution Performance Goals

• Measure current performance as a baseline for improvement
and setting future state goals.
3.
Guidelines • Solution Performance Measures
and Tools • Actual performance of existing solutions.

• Stakeholder Analysis Results

• Stakeholder contributions to understanding the current state.

Strategy Analysis 18
6.1 ANALYZE CURRENT STATE
• Benchmarking and Market Analysis
• Provides an understanding of where there are
opportunities for improvement.

• Business Capability Analysis

• Identifies gaps and prioritizes them in relation to value
and risk.
4.
Techniques • Business Model Canvas
• Provides context for any change by understanding value
proposition, critical factors in delivering value and cost
and revenue streams of the enterprise.

Strategy Analysis 19
6.1 ANALYZE CURRENT STATE
• Business Cases
• Captures business need and opportunity information.

• Concept Modeling
• Defines key terms and concepts in the business
domain and their relationships.

4. • Data Mining
Techniques • Obtain information on enterprise performance.

• Document Analysis
• Review existing documentation to better understand
current state.

Strategy Analysis 20
6.1 ANALYZE CURRENT STATE
• Financial Analysis
• Understand the profitability of the current state and
financial capability to deliver change.

• Focus Group
• Solicit feedback from customers or end users about
the current state.
4.
Techniques • Functional Decomposition
• Break down components of the current state.

• Interviews
• Dialogue with stakeholders to understand current
state and their needs.

Strategy Analysis 21
6.1 ANALYZE CURRENT STATE
• Item Tracking
• Manage issues discovered about the current state.

• Lessons Learned
• Assess failures and opportunities for improvement in
past initiatives.

4. • Metrics and Key Performance Indicators (KPIs)

Techniques • Assess performance of current state.

• Mind Mapping
• Explore current state and better understand factors
affecting the business need.

Strategy Analysis 22
6.1 ANALYZE CURRENT STATE
• Observation
• Insights into needs within the current state not previously
identified.

• Organizational Modeling
• Roles, responsibilities and reporting structures within the
current state.
4.
Techniques • Process Analysis
• Identifies opportunities to improve current state.

• Process Modeling
• Describes how work occurs within the current solution.

Strategy Analysis 23
6.1 ANALYZE CURRENT STATE
• Risk Analysis and Management
• Identifies risks to the current state.

• Root Cause Analysis

• To understand underlying cause of any problems to
further clarify a need.

4. • Scope Modelling
Techniques • Defines boundaries on the current state.

• Survey or Questionnaire
• Better understand current state from stakeholders.

Strategy Analysis 24
6.1 ANALYZE CURRENT STATE
• SWOT Analysis
• Evaluate strengths, weaknesses, opportunities and
threats of the current state.

• Vendor Assessment
• Determine if current state vendors are meeting
commitments or if changes are needed.
4.
Techniques • Workshops
• Stakeholders collaborate to describe the current
state and their needs.

Strategy Analysis 25
6.1 ANALYZE CURRENT STATE
• Key Stakeholders
• Customer
• Domain SME
• End User
• Implementation SME
• Operational Support
5.
• Project Manager
Stakeholders
• Regulator
• Sponsor
• Supplier
• Tester

Strategy Analysis 26
6.1 ANALYZE CURRENT STATE
• Current State Description
• The context and relationship among the enterprise’s
scope, capabilities, resources, performance, culture,
dependencies, infrastructure and external
influences.

• Business Requirements
6. • The problem, opportunity or constraint defined
Outputs based on an understanding of the current state.

Strategy Analysis 27
6.2 Define Future State
6.2 DEFINE FUTURE STATE
• Purpose
• Determine the set of necessary conditions to meet the business need.

• Description
• Define the future state at an appropriate level of detail:
• Allows strategies to achieve the future state to be identified and assessed
• Provides clear definition of outcomes to satisfy business needs
• Future state value can be assessed
• Consensus among stakeholders of shared vision of the outcome
• Identify components of the enterprise affected by the change and their
boundaries
• Define appropriate performance measures

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6.2 DEFINE FUTURE STATE

Strategy Analysis 30
6.2 DEFINE FUTURE STATE
• Business Requirements
• Problems, opportunities or constraints that the future
state will address.

1.
Inputs

Strategy Analysis 31
6.2 DEFINE FUTURE STATE
• Business Goals and Objectives
• Describes the ends that the organization is seeking
to achieve.
• Longer term goals broken down into specific
objectives and linked to measures to assess
achievement.

2. • Scope of Solution Space

Elements • Defines which kind of options will be considered
when investigating possible solutions.
• Not directly related to the size of the change.

Strategy Analysis 32
6.2 DEFINE FUTURE STATE
• Constraints
• Describe aspects of the current state and future
state that may not be changed.
• Carefully examine to ensure they are accurate and
justified.

• Organizational Structure and Culture

2. • Identify changes needed to support the future state.
Elements
• Capabilities and Processes
• Identify new or changed capabilities and processes
to realize the future state.

Strategy Analysis 33
6.2 DEFINE FUTURE STATE
• Technology and Infrastructure
• May impose technical constraints on the solution.

• Policies
• Common source of solution constraints.
• Identify necessary changes for the desired future
state.
2.
Elements • Business Architecture
• All elements of the future state must contribute to the
overall desired future state of the enterprise as a
whole.

Strategy Analysis 34
6.2 DEFINE FUTURE STATE
• Internal Assets
• Resources may need to be changed or increased to
implement the change strategy and support the
future state.

• Identify Assumptions
• Must be identified and clearly understood to enable
2. decisions if they later prove invalid.
Elements
• Potential Value
• Evaluate to see if the overall potential value of the
solution justifies a change compared to making no
change.

Strategy Analysis 35
6.2 DEFINE FUTURE STATE
• Current State Description
• Provides context for the work to be completed.
• Starting point for the future state.

• Metrics and Key Performance Indicators (KPIs)

• Determine if desired future state has been achieved.
3.
• Organizational Strategy
Guidelines
• Path, method or approach to be taken to achieve the
and Tools desired future state.

Strategy Analysis 36
6.2 DEFINE FUTURE STATE
• Acceptance and Evaluation Criteria
• Identify what makes future state acceptable and how
to evaluate options.

• Balanced Scorecard
• Set targets for measuring the future state.

4. • Benchmarking and Market Analysis

Techniques • Make decisions about future state business
objectives.

• Brainstorming
• Collaborate ideas for the future state.

Strategy Analysis 37
6.2 DEFINE FUTURE STATE
• Business Capability Analysis
• Prioritize capability gaps in relation to value and risk.

• Business Cases
• Capture the desired outcomes of the change initiative.

• Business Model Canvas

4.
• Plan enterprise strategy to fulfill value proposition.
Techniques
• Decision Analysis
• Compare different future states and understand which
is the best choice.

Strategy Analysis 38
6.2 DEFINE FUTURE STATE
• Decision Modeling
• Model complex decisions regarding future state options.

• Financial Analysis
• Estimate potential financial returns to be delivered.

• Functional Decomposition
4.
• Break down complex systems for better. understanding
Techniques
• Interviews
• Understand desired future state and needs of
stakeholders.

Strategy Analysis 39
6.2 DEFINE FUTURE STATE
• Lessons Learned
• Determine which opportunities for improvement to
address and how current state can be improved.

• Metrics and Key Performance Indicators (KPIs)

• Determine when business objectives have been
achieved.
4.
Techniques • Mind Mapping
• Develop ideas and understand relationships.

• Organizational Modelling
• Describe roles, responsibilities and reporting structures
within the future state organization.

Strategy Analysis 40
6.2 DEFINE FUTURE STATE
• Process Modelling
• Describe how work would occur in the future state.

• Prototyping
• Model future state options and their potential value.

• Scope Modelling
4.
• Define boundaries of the enterprise.
Techniques
• Survey or Questionnaire
• Understand desired future state of stakeholders and
their needs to be addressed.

Strategy Analysis 41
6.2 DEFINE FUTURE STATE
• SWOT Analysis
• Evaluate strengths, weaknesses, opportunities and
threats to be exploited or mitigated.

• Vendor Assessment
• Assess potential value provided by vendor solution
options.
4.
Techniques • Workshops
• Collaborate with stakeholders to describe the future state.

Strategy Analysis 42
6.2 DEFINE FUTURE STATE
• Key Stakeholders
• Customer
• Domain SME
• End User
• Implementation SME
• Operational Support
5.
• Project Manager
Stakeholders
• Regulator
• Sponsor
• Supplier
• Tester

Strategy Analysis 43
6.2 DEFINE FUTURE STATE
• Business Objectives
• The desired direction that the business wishes to
pursue in order to achieve the future state.

• Future State Description

• Boundaries of the proposed components of the
enterprise and potential value expected from the
6. future state.
Outputs
• Potential Value
• The value that may be realized by implementing the
proposed future state.

Strategy Analysis 44
6.3 Assess Risks
6.3 ASSESS RISKS
• Purpose
• Understand the undesirable consequences of internal and external
forces on the enterprise during a transition to or within the future state
to recommend a course of action.

• Description
• Analyze and manage risks related to the current state, future state, a
change itself, a change strategy or any tasks performed by the
enterprise.
• Consequences if the risk occurs
• Impact of those consequences
• Likelihood of the risk
• Potential time frame when the risk might occur
• Used as an input to identify a change strategy.

Strategy Analysis 46
6.3 ASSESS RISKS

Strategy Analysis 47
6.3 ASSESS RISKS
• Business Objectives
• Desired direction used to identify potential risks.

• Elicitation Results (confirmed)

• Stakeholder perceptions of risks to realize their
desired future state.

1. • Influences
Inputs • Internal and external factors that impact future state.

• Potential Value
• Identify value of future state to assess risks.

• Requirements (prioritized)
• Influences the risks associated with the solution.

Strategy Analysis 48
6.3 ASSESS RISKS
• Unknowns
• Assess risks based on current understanding.
• Estimate impact of unknown or uncertain events using:
• Historical context from similar situations
• Lessons Learned from past changes
• Expert Judgement from stakeholders
2. • Constraints, Assumptions and Dependencies
Elements • May help identify risks or managed as risks themselves.

• Negative impact to Value

• Quantify overall risk level for potential impact.

Strategy Analysis 49
6.3 ASSESS RISKS
• Risk Tolerance
• Amount of uncertainty the organization is willing to
accept in exchange for potential value.
• Attitudes toward risk:
• Risk-aversion
• Neutrality

2. • Risk-seeking

Elements • Recommendation
• Understand overall risk level and stakeholder
tolerance toward risk to recommend a course of
action.

Strategy Analysis 50
6.3 ASSESS RISKS
• Business Analysis Approach
• Guides how risks are analyzed.

• Business Policies
• Defines limits for decisions and may mandate
aspects of risk management.

3. • Change Strategy
Guidelines • Provides transition plan from current to future state.
and Tools
• Current State Description
• Provides context for work to be completed.

Strategy Analysis 51
6.3 ASSESS RISKS
• Future State Description
• Determines risks associated with the future state.

• Identified Risks
• Starting point for thorough risk assessment.

• Stakeholder Engagement Approach

3.
• Understand stakeholders to identify and assess
Guidelines potential impact to internal and external forces.
and Tools

Strategy Analysis 52
6.3 ASSESS RISKS
• Brainstorming
• Collaborate on identity of potential risks for assessment.

• Business Cases
• Capture risks associated with alternative change
strategies.

4. • Decision Analysis
Techniques • Used to assess problems.

• Document Analysis
• Analyze existing documentation for potential risks,
constraints, assumptions and dependencies.

Strategy Analysis 53
6.3 ASSESS RISKS
• Financial Analysis
• Understand the effect of risks on the financial value
of the solution.

• Interviews
• Understand what stakeholders think might be risks.

4. • Lessons Learned
Techniques • Foundation of past issues that might be risks.

• Mind Mapping
• Identify and categorize risks and understand their
relationships.

Strategy Analysis 54
6.3 ASSESS RISKS
• Risk Analysis and Management
• Used to identify and manage risks.

• Root Cause Analysis

• Identify and address underlying causes creating risks.

• Survey or Questionnaire
4.
• Understand what stakeholders think might be risks.
Techniques
• Workshops
• Understand what stakeholders think might be risks.

Strategy Analysis 55
6.3 ASSESS RISKS
• Key Stakeholders
• Domain SME
• Implementation SME
• Operational Support
• Project Manager
• Regulator
5.
• Sponsor
Stakeholders
• Supplier
• Tester

Strategy Analysis 56
6.3 ASSESS RISKS
• Risk Analysis Results
• An understanding of the risks associated with
achieving the future state and the mitigation
strategies used to prevent, reduce the impact or
likelihood of risk occurring.

6.
Outputs

Strategy Analysis 57
6.4 Define Change
Strategy
6.4 DEFINE CHANGE STRATEGY
• Purpose
• Develop and assess alternative approaches to the change and then
select the recommended approach.

• Description
• Describes the nature of the change in terms of:
• Context of the change
• Identified alternative change strategies
• Justification for the recommended change strategy
• Resources required to move to desired future state
• How the enterprise will realize value after solution delivery
• Key stakeholders involved in the change
• Transition states while working toward future state

Strategy Analysis 59
6.4 DEFINE CHANGE STRATEGY

Strategy Analysis 60
6.4 DEFINE CHANGE STRATEGY
• Current State Description
• Provides context about the current state and
includes assessments of internal and external
influences to the enterprise.

• Future State Description

• Provides context about the desired future state.
1.
• Risk Analysis Results
Inputs
• Identified risks and exposure.

• Stakeholder Engagement Approach

• Understand communication and collaboration needs
of stakeholders to identify change-related activities
to be included in the change strategy.

Strategy Analysis 61
6.4 DEFINE CHANGE STRATEGY
• Solution Scope
• Defines the solution boundaries in enough detail to
enable stakeholder understanding.
• Describes how the proposed solution enables the
future state’s goals.

• Gap Analysis
2. • Difference between current and future state
Elements capabilities.
• Identifies gaps that prevent the enterprise from
meeting needs and achieving goals.

• Enterprise Readiness Assessment

• Assess the organization’s capacity to make and
sustain the change in the future state.

Strategy Analysis 62
6.4 DEFINE CHANGE STRATEGY
• Change Strategy
• Key activities and events used to transform the
organization from current to future state.
• Identify preferred change strategy from several
options through a business case.

• Transition States and Release Planning

2. • Determine which requirements to include in each
Elements release, phase or iteration of the change if the future
state will be achieved over time.

Strategy Analysis 63
6.4 DEFINE CHANGE STRATEGY
• Business Analysis Approach
• Guides definition of the change strategy.

• Design Options
• Describes ways to satisfy the business needs.

• Solution Recommendations
3.
• Identify possible solutions for the future state with
Guidelines SMEs.
and Tools

Strategy Analysis 64
6.4 DEFINE CHANGE STRATEGY
• Balanced Scorecard
• Define metrics used to evaluate effectiveness of the
change strategy.

• Benchmarking and Market Analysis

• Make decisions on which strategy is appropriate.

4. • Brainstorming
Techniques • Collaborate ideas for change strategies.

• Business Capability Analysis

• Prioritize capability gaps in relation to value and risk.

Strategy Analysis 65
6.4 DEFINE CHANGE STRATEGY
• Business Cases
• Capture information on change strategies.

• Business Model Canvas

• Define changes needed to achieve the potential value.

• Decision Analysis
4.
• Compare different strategies and chose the most
Techniques appropriate.

• Estimation
• Determine timeline for activities within the change
strategy.

Strategy Analysis 66
6.4 DEFINE CHANGE STRATEGY
• Financial Analysis
• Understand potential value of the change strategy.

• Focus Groups
• Solicit input on the solution and change strategy.

• Functional Decomposition
4.
• Break down components of the solution.
Techniques
• Interviews
• Obtain stakeholder input on solution scope, change
scope and change strategy.

Strategy Analysis 67
6.4 DEFINE CHANGE STRATEGY
• Lessons Learned
• Understand what went wrong in past changes to
improve this change strategy.

• Mind Mapping
• Develop and explore ideas for change strategies.

4. • Organizational Modelling
Techniques • Describe roles, responsibilities and reporting structures
for the change as part of the solution scope.

• Process Modelling
• Describe how work would occur during the change.

Strategy Analysis 68
6.4 DEFINE CHANGE STRATEGY
• Scope Modelling
• Define the boundaries on the solution scope and
change scope descriptions.

• SWOT Analysis
• Make decisions about which change strategy is
appropriate.
4.
Techniques • Vendor Assessment
• Determine if vendors are part of the change strategy.

• Workshops
• Work with stakeholders to develop change strategies.

Strategy Analysis 69
6.4 DEFINE CHANGE STRATEGY
• Key Stakeholders
• Customer
• Domain SME
• End User
• Implementation SME
• Operational Support
5.
• Project Manager
Stakeholders
• Regulator
• Sponsor
• Supplier
• Tester

Strategy Analysis 70
6.4 DEFINE CHANGE STRATEGY
• Change Strategy
• The approach that the organization will follow to
guide change.

• Solution Scope
• The scope of the solution that will be achieved
through execution of the change strategy.
6.
Outputs

Strategy Analysis 71