Value is an important concept in business analysis, and an important part of conducting business analysis is gaining a common understanding of the types of value that our stakeholders are trying to attain with a particular project or initiative. Indeed, ‘Value’ is a one of the focal points in the Business Analysis Core Competency Model (BACCM™) in the Business Analysis Body of Knowledge Guide (BABOK®), which defines value from the perspective of business analysis as:
“The worth, importance or usefulness of something to a stakeholder or in a context”
This is clearly only one possible definition of value, but it is worth pausing and reflecting on. It implies an important distinction that we, as practitioners, instinctively know but rarely talk about. What is considered ‘valuable’ varies depending on who you ask and the context in which we are operating in. In fact, what is considered ‘valuable’ may vary over time, and this has an impact on what we do as analysts and how we do it.
Defining Value: Trickier Than it Might Appear
It is easy to over-simplify the definition of value. We might (quite understandably) think that it is for the sponsor to decide what is valuable. Whilst there is a strong element of truth in this statement, and certainly the sponsor should define the strategically aligned outcomes they are seeking, success often involves balancing the needs of multiple stakeholders and groups—so of whom have no direct power on the project that we are working on. It is important that we bring this view to the fore so that conscious decisions can be made.
Let’s imagine we are implementing a change project which will improve the processes in the contact centre of an insurance company’s claims department. The sponsor may value “efficiency” and may have a specific amount of saving that she or he is looking to attain. Of course, this could be better elaborated with a problem statement and a set of critical success factors and key performance indicators.
Yet, even if we have a clear metric we are aiming for, there will be many other stakeholders in this picture. We ignore their perceptions of value at our peril! For example: