March 10, 2022
4 min.

Guideline for the Creation of Functional Concepts

Concepts serve as action guidelines for projects and can be divided into three categories:
Project assignment, functional concept, and IT concept.

The functional concept can be understood as a specification sheet that focuses on the functional requirements. Usually, business analysts and requirements managers are the authors. They are responsible for documenting the scope and functionality of the deliverables to be realized by the project.

This guide explains, how we can create a functional concept in the role of the business analyst.

The GREAT Principle

Good functional concepts are distinguished by five essential characteristics:

Goal orientation: The functional concept is directly and comprehensibly aligned with the goals set out in the project assignment. It explains the functionalities as well as the technical and organizational processes and procedures that are to be supported by the technical solution.

Realistic planning: Functional concepts can also cover extensive project goals if they can be realized in general. If appropriate, we split the goals over several releases and create a separate functional concept for each release. In addition, a prioritization (Must, Should, Could and Won’t) of the functional requirements helps.

Easy and to the point: A good functional concept gives a short, precise, and determined summary of the functional requirements. Adding justifications if necessary to make certain conceptual decisions comprehensible. Anyhow, all details should be described precisely and clearly, as they will be essential for the subsequent IT conception.

Addressee-oriented: Recipients of the functional concept are all stakeholders of the project. Whether senior developers, project managers, software operations staff or indirectly involved business units, they all should be able to find, understand, discuss, and confirm the information relevant to them in the concept.

Triggers for activities: Finally, the functional concepts should not only contain ideas and goals, but also precise strategies and recommendations for action. The functional concept can define the project design, available resources, team setup, project phases and deadlines/milestones. Thus, the functional concept serves as the basis for the IT concept, which describes how the subjects defined in the functional concept will be implemented.

Steps for creating a Functional Concept

  • Define goals

The first step in creating a functional concept is to define clear and unambiguous goals. The goals of the functional concept are derived directly from the project assignment: What exactly is to be achieved and implemented? The goals must be agreed with stakeholders and help to create a common picture of the subjects the project is going to realize.

  • Collect information

The next step is to gather all the relevant information. Who will be involved in achieving the goals? How much time is available? What is the budget? What expectations or requirements must be met? What constraints and framework conditions must be strictly observed? The channels of collecting information can be manifold: workshops, surveys, searches within requirements databases, information material from the proposal, meeting protocols and interviews with experienced employees.

  • Define formats and structure

Especially in large companies, it is common to have some standardization in documentation. Early research on the latest status of the required templates and formats helps to avoid later formal corrections and additions, thus saving unnecessary costs. It is also necessary to have an exact idea how is the functional concept related to which information and documentation. From which documentation and information sources will the functional concept receive input? For which types of documentation and for which project teams will it be the information source?

  • Complete contents

While writing the content, we should not digress and waste time on unnecessary information or absurd scenarios, but instead concentrate on the essentials and express them clearly. We may also consider the layout to create a professional functional concept. Some tips for this: use font formatting such as bold or italics sparingly; harmonize illustrations and images visually and stylistically; standardize different image formats.

  • Get feedback

The business analyst is responsible for creating the functional concept. Nevertheless, many other project roles are assigned to the later implementation. It is therefore important to obtain the opinions and feedback of stakeholders. In addition, this type of communication helps to gain greater approval for the functional concept.

  • Change management

If the responsibility for correctness and quality is distributed within the team and control instances are installed, the concept can still be out of date if changes occur more frequently. We recommend that the process is organized by a single person. A standardized representation of the change process using font type and color enables us to have current information in the functional concept.

Example Structure of a Functional Concept

Different companies and even departments within companies use various templates for functional concepts – depending on their specific internal and external stakeholders, technologies and systems, and a variety of other factors. Any form of documentation can be used as a functional concept template as soon as it helps to reach agreement within the team on the scope of the project and to support other internal and external stakeholders to get information. Regardless of the form, a core set of important information should be contained in every concept. An example structure for a functional concept template is presented here:

  • Revision protocol
  • Overview
  • General conditions
  • Scope
  • Assumptions, risks, problems, and dependencies
  • Functional requirements
  • Non-functional requirements
  • Project design
  • Links and references

Brought to you by:

Zhaoxi Wang
Business Analyst, Functional Lead Requirements Engineering