What is business assurance (BA)?
BA, in layman terms, refers to something which helps or supports an organization in assuring that things are working as planned. More technically, it includes near real-time processes and controls embedded within the organization’s decision making and culture. This function has a very wide coverage and may sometimes overlap with other functions when not managed properly.
Why BA is needed
When talking about any company going for, or already in the digital transformation phase, we come across a variety of areas that are core to any transformation project such as customer experience, digital products, operations, strategy and digital IT.
What’s more, the digital economy is complicated, with thousands of partners and over the top (OTT) players in the mix. Who is going to take care of their revenue share or payment terms? Of course you have the system owners, but what is your second line of defense? Similarly, who is going to follow through with the bundled promotion that one of your partners launched? Or, how are you sure that the omnichannel experience connected to your big data analytics is being updated in line with the marketing team’s updates, to understand whether to push or pull back certain promotions? How can you be certain that the new product strategy, which is based on an assumption of 5% market penetration, has actually targeted what was proposed?
For all this and more, we need a system which not only ensures processes are followed, but also establishes accountability. This is a function which works proactively throughout the value chain. This also helps in the seamless and agile monitoring of any digital transformation project and promotes transparency. Any company willing to go for digitalization must go for BA as that will be the ONLY end-to-end monitoring system, and a second line of active defense for a complex digital environment.
How to implement BA
There are multiple facets influencing or defining the scope of BA. Since the scope of BA is so huge, companies or individuals tend to define the scope as per their experiences and expectations in a particular domain. For example, someone in risk management would include risk, audit and operational efficiency in their BA scope. Meanwhile, someone in revenue management would exclude risk and audit from theirs. This has led to great confusion and philosophical discussion in the industry as to what the actual scope of BA is. Moreover, the absence of any defined standards or framework for BA has made this domain more complicated.
We need to understand and acknowledge that BA activities cannot be universal for all companies and setting a proper context is needed before initiating any activity or action plan. Establishing context will help individuals to identify critical success factors and key focus areas. A proper PDCA cycle needs to be followed for BA end-to-end execution. Objective and quantitative benchmarking are also necessary when setting context.
The key differentiator for BA would be a well defined and mandated policy document along with a practical RACI matrix to help in defining proper roles and responsibilities. The objective of BA is not to own everything, but to create an environment and culture which promotes growth; growth through process improvement, growth through revenue enhancement and growth through an enriched customer experience.
Tools for BA
The recommended tools for end-to-end BA are:
- Business Assurance Monitoring Tool (BAMoT)
- Digital Maturity Assessment Tool (DiMAT)
- Revenue Assurance Maturity Model Tool (RAMM2)
All of the above tools compliment each other and monitor the BA activities throughout the transformation journey and beyond.