Example of Business Analysis Tools and Techniques
Free Business Analysis Tools and Techniques: We all know how important business analysis can be for any corporation. It helps us to track and analyze our business’s day to day processes. It then enables us to spot areas that need improvement to make our internal processes perform more efficient. Over the years the business analysis field has now evolved. We now have a lot of tools we can use to analyze our business in unique ways.
The core concept of what business analysis is will always be there. The only real change is that you now have a lot of tools and techniques you can use to make your processes run better. This is very beneficial and it changes the way how managers approach there businesses. It helps them to adapt and be competitive in an ever changing business environment.
Below you can see a list of business analysis tools and techniques you can capitalize on. If some of these tools are implemented they can make your business processes perform better.
SWOT Analysis
The SWOT analysis is a tool widely used by business managers. It will help you identify strengths, different weaknesses, opportunities and major threats in your business. This can be easily drawn on a 2×2 matrix which will help to visualize the whole process. You and your team can then get together and discuss the different parts of the SWOT analysis.
The strengths and weaknesses are usually internal factors that are affecting your organization. The opportunities and threats have to deal with the external factors affecting your company. It also assists you spotting innovations in your industry that you can capitalize on.
PEST Analysis
The PEST analysis can help you analyze your market to understand the political, economic, technological and socio-cultural environment that your company operates in. It’s normally used to evaluate how well your market is performing. This information will help you to make critical decisions which can affect your business’s future. The political factors include the government regulations that are in your market such as the environmental regulations and tax policy.
This will make certain that your business always comply with the rules of your environment. The economic factors have to deal with the current economical state of your market which deals with inflations, interested rates etc. It helps to structure your business’s capital system correctly. The social factors include age demographics and population growth. This will help you to analyze consumer needs. Lastly technological factors include the rate of technological change in your industry. This information can help you make decisions on research and development to create new innovations.
Porter’s 5 Forces
This strategy was developed by Michael E. porter who was at Harvard business school. It is used to analyze the competitive strength and position of a company in a certain market.
These 5 forces are supplier power, buyer power, competitive rivalry, threat of substitution and threat of new entry. If you implement this strategy you will understand better whether your potentially new product or service have a chance to survive and stay profitable. The supplier power mainly has to do with the relative size and strength of a certain supplier. You can also look at the cost of switching from one supplier to another.
This information will show you how likely a supplier will be able to drive up prices. For the buyer power you have to look at the number of buyers in your market. How Important is each buyer to your organization is also important. This information will allow you to see how easy it is for buyers to drive prices. This can have a profound effect on you structure your business model.
Competitive rivalry helps you to measure how well your company is performing against your competitors. The threat of substitution can help you analyze your market to see how closely related are your products comparing to your competitors. When it’s closely related that can make it easy for a customer to switch to another competitor. This information can then be discussed with your team.
This will enable you to identify the necessary changes you have to make to your product. In order to make certain it stand out in your market. Threat of entry will help you identify the different hurdles that are stopping you from competing against competitors in your market. These barriers can be regulatory, patents and economy of scale. This data will then help you and your team to develop strategies to try and break through those barriers. If you have the necessary capital to pull it off.
Value Chain Analysis
At times certain operations and processes within your company don’t seem to add any value to your organization. The bad thing is some of these operations can go under the radar. Value chain analysis can help you change all that. Basically value chain analysis is a strategy you can use to analyze the different processes and activities within your business. When analyzed, you can then spot the activities that are not adding any value to your organization.
To go about using this tool you can look at the different parts of your company. Then analyze each of them to see how much value each is adding to your overall organization. You can also look at how important each key operation is adding value to customer satisfaction and market success.
Staying competitive in business can be a daunting task at times. Using business analysis tools and techniques can make the job easier. Some of these tools will help you to also strengthen your internal processes so your business can function better. Overall if you should use some of these strategies above and many others which you think might be useful. You would usually see changes within your organization.
These Free Business Analysis Tools and Techniques can also help you to be equipped for battle in your market to keep your business afloat:
Free Business Management Tools