Do you need to have domain knowledge to be a successful business analyst? That’s one of the most popular questions that I receive. And the answer is hugely dependent on your specific situation and the job you’re in.
After being in this industry for nearly two decades, I've discovered some common requirements for domain knowledge among in-house BAs, BA-generalists, and BA-consultants, which I am happy to share in this article.
What is Domain Knowledge?
So, first of all, what is domain knowledge?
Usually, as BAs, we talk about two types of domain knowledge:
Business Domain or Industry Knowledge
Solution Domain or Technical Knowledge.
Examples of business domains include telecommunications, banking, insurance, automotive, healthcare, and so on. On the other hand, solution domains involve various digital solutions, such as e-commerce, content management, CRM, ERP, personalization, etc.
These two domain types can peacefully coexist. For instance, we can discuss CRM solutions in banking, ERP solutions in the automotive industry, or e-commerce in telecommunications.
Based on my experience, the answer to the question of whether a BA needs to have domain knowledge will really depend on the type of job the BA does. And for this, let’s look at the following BA roles:
In-house BAs,
BA generalists, and
BA consultants.
In-House BA
In-house BAs work for non-IT, non-software development companies, usually as part of their IT department. Let’s say it’s a beverages company that produces drinks, or it’s an automotive company that manufactures cars. An in-house BA is directly employed by this non-IT company.
If you’re an in-house BA, you definitely need to have a very decent knowledge of the business domain and the industry you’re in. When you’re starting a new job as an in-house BA, you should absolutely nail down existing As-Is processes, workflows, and IT systems that support these processes. In a way, you need to become an internal Subject Matter Expert (SME) that knows the ins and outs of the business you’re in.
Besides the processes, you’ll need to know real business use cases that real people deal with. These people include both internal business users (accounting department, or marketing) and external customers of your company. All this knowledge is a must if you’re an in-house BA.
BA-Generalist
Now let’s look at BA generalists. A BA generalist usually works for an IT consulting or software development company. This is an IT company that builds software for external clients, and those clients can be from various industries – insurance, automotive, healthcare, manufacturing, and so on.
The BA generalist is directly hired by this IT company and, while employed there, may work on projects for various industries – like projects for insurance companies, healthcare projects, or software for logistics companies. The main point here is that one day you're assigned to a project from one industry, another day it’s another industry, and then it’s something else, and something else.
That shapes the main characteristic of a BA generalist – you are supposed to possess great hard and soft BA skills and be able to quickly jump into a new domain. That ability to quickly get familiar with new terminology, processes, workflows, and local regulations is critical to the success of a BA generalist.
So, if you’re a BA generalist – knowledge of business domains is a very nice-to-have skill, but usually, it’s not mandatory.
However, BA generalists may have specializations, because they may work, let’s say, on a series of projects for insurance companies. So, they themselves may become subject matter experts in insurance. This may increase the chance of them being assigned to more complex insurance projects in the future or become an internal trainer or consultant for other BAs in their organization.
Along with industry knowledge, some organizations may have expectations for BAs to have knowledge of solution domains like CRM, or e-commerce, or even specific tools like Microsoft Dynamics or SAP Commerce. But usually, these requirements are nice-to-have.
BA-Consultant
And finally, let’s consider whether BA-consultants need to have domain knowledge.
Now, who is a BA-consultant? Usually, it’s a very senior BA, either self-employed (working as an independent consultant) or working for a consulting company and handling special projects for top-selected clients.
Very often, successful BA consultants have some kind of specialization; it’s either in the solution domain, or in a specific tool, or in the business industry, or all of these. You may be a BA consultant that specializes in B2B ecommerce implementations on SAP Commerce Cloud for large fashion companies. Or you may be building patient portals for clinical trials, which is a very specific and highly regulated domain.
Some kind of specialization is a must for BA consultants, and therefore, we can say that business or solution domain knowledge is also a must.
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Conclusion
So now, as we've looked at various examples and types of BA jobs, I hope it makes more sense as to whether you need to have domain knowledge to succeed in your career journey.
My strong opinion is that, especially in the current very competitive job market, domain knowledge is very much needed to be a successful BA.
Why? Because companies more often look for BAs that have some knowledge of the industry or type of solution, so that these BAs require less time for onboarding and diving into a new domain. These BAs already know the working terminology and certain real-world use cases, which makes it much easier for clients to communicate with them.