Business Analyst vs. Functional Analyst | What are the role differences and why are they needed?

Although job titles in business analysis can be vague and inconsistent across organizations, they remain valuable for distinguishing job roles within a broad profession.

Recently, I've been contemplating the differences between business analyst (BA) and functional analyst (FA) roles. While I knew the roles were distinct, I found myself struggling to articulate their differences.

"...tasks and techniques used to work as a liaison among stakeholders..."

If you're confused about what a Business Analyst (BA) actually does, don't worry - you're not alone. According to the International Institute of Business Analysis (IIBA), a BA essentially performs any task related to business analysis, regardless of their job title or organizational role. So, what exactly is business analysis? It's the process of understanding an organization's structure, policies, and operations in order to recommend solutions that help the organization reach its goals.

While it may seem like a broad definition, BAs can add value to organizations in a variety of ways, not just when it comes to software solutions. They aim to boost an organization's profitability or efficiency, using their skills to influence areas like accounting, billing, procurement, supply chain, manufacturing, and sales and marketing across various industries. BAs might analyze financial or other data, streamline business processes, and help translate stakeholder needs into actionable designs and requirements for business systems or other solutions. Ultimately, their goal is to help organizations achieve their business objectives - now that's worth knowing!

Then, what is a Functional Analyst?

The most common definition I located was: “The functional consultant has to understand the modules they are implementing and the set up and configuration options available; the key skill is being able to map the requirements of the customer to the capabilities of the ERP system.”  If you ignore the reference to ERP, it sounds very much like the definition of a portion of a functional analyst role. It is seemingly about mapping the customers’ requirements to the selected system or solution, then working out the best way to deal with any gap in between. Additionally, functional analysts design systems and create functional technical design documents that allow for data sharing across the organization; design which is proven or validated by testing. 

Functional analysts and business analysts both attempt to improve a company's processes and procedures. The focus of functional analysts is on technology, while business analysts often explore many other aspects of an organization. Business analysts, strive to improve business productivity and establish new programs. But both of these professionals should understand the technological opportunities and requirements of the organization.

Interesting, sometimes challenging, is that often they are one and the same person!

In summary, the business analyst elicits, validates and manages business and stakeholder requirements, seeks viable solutions to business problems and interacts regularly with business stakeholders, while the functional analyst looks at how the chosen solution can be used to meet those requirements. In the end, they are different roles, but what makes it especially interesting, sometimes challenging, is that often they are one and the same person!

Why are Functional Analysts and Business Analysts needed?

Finally, some may be wondering why they would need an experienced business analyst and/or functional analyst. The IIBA further elaborates in this regard, stating that “business analysis is the practice of enabling change in an organization by defining needs and recommending solutions to stakeholders. Business analysts enable an organization to articulate needs and the rationale for change, and to describe and design solutions that can deliver significant value.”  Elaborating a bit more from my own experience, organizations don’t often know how to identify and diagnose a perceived problem or challenge, but they certainly see and experience the symptoms of such. 

A business analyst specializes in:

• Listening
• Interviewing
• Performing root cause analysis
• Targeting root cause

Thereby stating the business problem in detail. In fact, some organizations that have been engaged in the same processes and practices for many years have no idea there are issues or a related root cause to address. Business analysis can also be performed on a variety of initiatives within an organization. Initiatives may be strategic, tactical, or operational. Business analysis may be performed within the boundaries of a project or throughout organizational evolution and continuous improvement. It can be used to understand the current state, to define the future state, and to determine the initiatives and activities required to move from the current to the future state. 

If the business analyst isn’t the same person to move into the functional analysis, he or she can work in concert with a functional analyst to design a solution that adds significant value to an organization. For example, in the case of a software implementation, by having a completed functional design - time, resources, and most importantly, money, are saved when everyone involved in designing, developing, implementing, testing, and approving of a solution have signed-off on a document containing all design and functional requirements. 

Additionally, those testing the system know precisely what to test. Ultimately, the organization understands exactly what is to be delivered. 

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