Recruiter's Glossary

Examples: Market Research • Compliance Framework • Transfer Pricing

Sensitivity Analysis

Term from Business Advisory industry explained for recruiters

Sensitivity Analysis is a business tool that helps understand how different changes might affect a project or investment's outcome. Think of it as a "what-if" testing method where advisors change various factors (like costs, sales, or timelines) to see how these changes impact the final results. It's similar to testing different scenarios in a business plan. Consultants and analysts use this to help clients make better decisions by showing them what could happen under different circumstances. You might also hear it called "what-if analysis" or "scenario analysis."

Examples in Resumes

Conducted Sensitivity Analysis for a $10M investment project to evaluate risk factors

Led financial modeling and Sensitivity Analysis for merger opportunities

Performed What-If Analysis and Scenario Analysis to assess market expansion risks

Typical job title: "Financial Analysts"

Also try searching for:

Business Analyst Financial Analyst Risk Analyst Management Consultant Investment Analyst Business Advisory Consultant Financial Advisor

Where to Find Financial Analysts

Professional Associations

• Association for Financial Professionals
• CFA Institute
• Financial Planning Association

Online Communities

Job Boards

Example Interview Questions

Senior Level Questions

Q: How would you explain the importance of sensitivity analysis to a client who doesn't have a finance background?

Expected Answer: A senior analyst should be able to simplify complex concepts, perhaps using real-world examples like showing how changing interest rates or market conditions could affect business decisions, and explain why this matters for risk management.

Q: Can you describe a time when sensitivity analysis revealed an unexpected risk in a project?

Expected Answer: The answer should demonstrate experience in using sensitivity analysis to uncover hidden risks and how they communicated these findings to stakeholders to influence decision-making.

Mid Level Questions

Q: What factors do you typically include in a sensitivity analysis for a new business venture?

Expected Answer: Should mention key variables like market size, pricing, costs, timeline, and competition, explaining how changes in these factors might affect project success.

Q: How do you present sensitivity analysis results to stakeholders?

Expected Answer: Should discuss creating clear visual presentations, focusing on key findings, and explaining implications in non-technical terms.

Junior Level Questions

Q: What tools do you use to perform sensitivity analysis?

Expected Answer: Should be familiar with basic tools like Excel and financial modeling software, understanding how to create simple what-if scenarios.

Q: What is the difference between sensitivity analysis and scenario analysis?

Expected Answer: Should explain that sensitivity analysis changes one variable at a time, while scenario analysis looks at multiple variables changing together.