Hello! I’m sitting in a cafe sipping on a bit of coffee when the following thought struck me - would it be useful for me to share with my readers the salary range of a business analyst?
Besides the project manager, the business analyst (BA) is the person most in contact with all stakeholders in a project.
Business analysts are usually articulate, have good communication skills and have some of the more interesting, functional work in any system project.
I chose business analysis as my initial career path and from there I moved on to be a project manager.
Given the popularity of the business analyst job role, I thought I’d share with you some insights into their salary range, particularly here in Asia, across industries and experience levels.
Before we delve into business analyst salaries, let’s understand what a business analyst does. In fact, what is business analysis?
Definition: Business analysis involves understanding how organizations accomplish their goals and defining the capabilities an organization requires in order to provide products and services to external stakeholders.
The above definition is from the International Institute of Business Analysis (IIBA) - which is a great resource on business analysis, by the way. I like the IIBA’s definition, but I’d clarify one point regarding “capabilities”.
What do capabilities mean in the above definition? Well, to me, capabilities refer to process or system capabilities. Perhaps there’s a process (e.g. scanning all incoming application forms) you can put in place to ensure the company meets a certain KPI - that’s a capability which supports business goals. From a system point of view, capabilities could refer to a new technology or system that is implemented to meet business goals. Implementation of a new CRM system or a core banking system is an example.
How did business analysis as a discipline evolve? Well, we can trace its roots.
Back in the 1980s, computer application development was a very “adhoc” affair. The developer of the system and the end user knew each other very well and communication channels were very good. Developers knew more or less exactly what users wanted. The computers back then, however were limited in processing power and often the developer would not be able to do what the user wanted.
Fast forward to the 1990s and 2000s. While system development methodologies became more industrialized and robust, user and developer communication channels started to degrade. This was simply because of the rapid pace of technology advancement and also the huge increase in the size of project teams. Requirements from users often got mis-communicated, leading to poor delivery of systems.
Today, while technical skills are important for systems development, it has become apparent that delivering a system is more about communication and people skills more than anything else. You can give me a crappy technology platform, but guarantee excellent communication between developers and users - and the project will STILL be a success. Give me a state-of-the-art technology, but with little rapport and communication between developers and users - and I can almost guarantee project failure.
Now, do note that the BA role is a good role to play as it gives you a springboard into other roles like Test Manager, Project Manager or Strategy Consultant, etc. Which was why I chose to dedicate my initial years in consulting to business analysis.
One might argue that a project manager and a business analyst have a lot in common. And that is true. For me, I’ve played the role of BOTH the PM and BA in many projects. Especially for smaller scale projects, the two roles are often combined. Why? I think it’s because the underlying skill sets required of the two roles are so similar.
Both the PM and BA roles have one prerequisite - excellent communication skills.
Case Study: I started in a programmer’s role in a large American multinational company. I programmed in Java, learned about Enterprise Java beans, J2EE, opening database connections, building database views, nested SQLs and so forth.
But I really didn’t like technical side of things. I found I enjoyed interaction with users. I liked to facilitate meetings to gather requirements. I liked planning functional modules and having twenty people in a room thinking about what use cases a new technology platform should have.
I loved things like “business process re-engineering”, “use cases” and “data flow diagrams”. I think the business side of things attracts me and I don’t like being holed up in the server room doing coding.
So through my BA role - where I worked for hospitals, the state pension fund, banks and insurance companies, I picked up communication skills and the ability to work very well with users.
HOWEVER, there are some unique skills where PMs and BAs differ, and it’s important to understand that. For one thing, the PM needs to be “captain of the ship” and understand how the project looks like from big picture perspective.
The BA does not need to see this picture. In fact, the BA should be very analytical and “deep-dive” into his or her assigned topic, then listen, analyze and document extremely well.
To get back to the topic at hand, we’re interested in the salary range of a business analyst. I think there are several ways to slice this. We can take a point of view of salaries:
Let’s look at these in turn. And do take note that I put a caveat here regarding the salaries that I quote below - depending on market conditions, the salary figures will definitely be subject to change.
The salary range of a BA will differ according to the industry he or she works in.
Banking Business Analyst
Business analysts in the banking industry are in high demand and are also among the most well paid in the profession. Here in Singapore, a mid-level BA with about 5 to 8 years of relevant experience can easily draw about $70,000 to $140,000 a year. The increments in banks are also quite good - though the bonuses have been largely frozen due to the financial crises in 2008 to 2010.
Insurance Business Analyst
The next popular industry which needs lots of BAs is the insurance industry. Similar to banking, insurance companies need BAs to roll out systems, perform strategic analysis and forecasting, and so forth. In Singapore, a mid-level BA with about 5 to 8 years of relevant experience can easily draw about $50,000 to $100,000 a year. I do think the insurance industry pays its BAs less than in banking. However, if you take into account that insurance firms are still paying good bonuses (several months the last I checked with a friend in the industry) - I think on the whole, insurance BAs are still paid very well.
Other Industry Business Analysts
In other industries in Singapore, e.g. the public sector, healthcare or the consumer goods industry, I expect BAs to be paid less. Probably about 10% less than insurance BAs - which means a range of $45,000 to $90,000 a year. I think perhaps the exception is the petrochemical industry (e.g. BAs who work for the likes of Shell or Exxon Mobil) - those BAs are probably paid better and might even match those BAs in banking / insurance.
Ok, let’s do an analysis of BA salary ranges by level.
Junior Business Analyst
In general, a junior banking BA (3 to 5 years’ experience) in Singapore can expect to get $30,000 to $60,000 a year. Junior business analysts focus more on data analysis, requirements gathering and do a lot of heavy lifting work, especially documentation. They are usually slotted into very precise functional areas and have very fine grained tasks to do. They don’t tend to get involved in project vision, estimation and planning. User interaction is limited to taking minutes or asking planned interview questions.
Mid-Level Business Analyst
A mid-level business analyst (5 to 8 years’ experience) in Singapore can expect to get an estimated $70,000 to $140,000 a year. In industries like banking (esp. growth markets like private banking), this can be even higher. Mid-level business analysts focus more on planning and leading work streams.
They may still do data analysis, requirements gathering and documentation, but they tend to draw up the initial guiding principles and leave the rest to junior BAs to do. A mid-level BA may take care of two or three functional work streams and is usually already quite well trusted by the project’s stakeholders. Usually, a mid-level BA might be one who already worked in a previous phase of the project or might come from industry after a few years of beginner's experience.
Senior Business Analyst
A senior business analyst (more than 8 years’ experience) in Singapore can expect to get an estimated $100,000 to $180,000 a year. Again, this can be significantly more in hot industries like banking or insurance. Senior business analysts are more than capable of functioning as a project manager and can see both the big picture view and also more fine grained, functional analysis view.
They are very experienced in the industry and can tell from one glance if a requirement or insight is relevant or makes no sense. They may speak at external conferences to give insight into their area of expertise. They also have tremendous clout with the business users, usually at the C-level.
Expect a senior business analyst to be lunching with the likes of the CEO, CFO or COO. Senior level BAs usually have worked on many, many projects in one particular industry and may be familiar with several vendor solutions if they are doing system implementation.
Now, we move on to the solution point of view. Many business analysts also work in vendor environments, particularly in software vendors. Now, there are two types of vendors here:
ERP software vendors
These refer to major ERP vendors like Oracle and SAP. Business analysts working for these major ERP software vendors are typically VERY well paid. I think their pay range is anywhere from $90,000 to $160,000 a year for a mid-level business consultant in Singapore.
Their remuneration is a direct reflection of the demand of their skills in industry. Oracle and SAP skills have been in heavy demand since the early 2000s and continue to be in demand (esp. specific modules like CRM). So hint, hint - it’s a good place to be if you want to be a BA and work on many different client projects, while being well compensated.
Specialist software vendors
These refer to smaller vendors like Temenos, Olympic, Avaloq, Murex, SAS). These software vendors also hire business analysts who are responsible for gathering requirements and configuring software packages. A mid-level business consultant is also well paid here in Singapore, with pay packages anywhere from $80,000 to $140,000 a year.
The reason why vendor BAs are so well paid is that they have to do quite a bit of work - they do both requirements gathering and software configuration / troubleshooting. And the vendors also have to pay them well so that they don’t defect to banks, insurance companies or some other firm.
Less Developed Countries - Vietnam, Myanmar, Laos
If you’re an expatriate business analyst based in these countries, you can expect quite a good pay package, e.g. about $45,000 to $90,000 a years to cover hardship allowances and a premium for your knowledge.
Developing Countries - Malaysia and Thailand
I think the range for these countries for a mid-level, expatriate business analyst could be anywhere from $50,000 to $100,000 a year.
Developed Countries - Singapore, Hong Kong, China and Taiwan
If you’re an expatriate BA in these places, expect to get $70,000 to $140,000 a year in remuneration.
The key point here is that if you bring a premium skill set to the more developed countries like Singapore and HK (which are financial hubs in Asia) - you can expect to be handsomely rewarded.
If you bring a premium skill to other less developed Asian countries, you will still be paid well, but slightly less I guess - since what is considered a “premium” skill in Vietnam would only be an average skill set found in Singapore.
In general, BAs are paid about 20% to 30% less than PMs (in my humble opinion) and that’s because they choose to focus more on functional content and knowledge rather than doing “big picture” stakeholder management, user engagement and influence.
I think if you like working on problems and want to make that the major part of your career, but yet have the flexibility to meet people and facilitate workshops and perhaps do a limited bit of project management, then a business analyst career path could be just for you.
Until next time, have fun running your projects!
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