The need of having a Business Analyst for IT project might have came up when more and more business problems were addressed by the software companies. The outsourcing and offshore phenomenon may have made the need even more urgent.

Software Services organization still fail to understand the role of Business Analyst, or do they? Projects fail because the requirements are not done properly, the expectations are not set up right at the very start. Let me put it in different way, projects fail because the vendor or the services company is not able to understand the business of the client. A business analyst should not only do the requirements but should be involved through out the lifecycle of the project and should be the owner from the business side. More of a clients representative then a vendor’s representative. As Babcock put his concern nicely:

Is the role of business analyst an IT role, a business role, or both? How can the BA role be used to the greatest benefit of the organization?

In his article 
Finding a home for Business Analysts he beautifully explains the roles a BA must play. He points out that the Business Analyst should be more involved in developing a Business Case then playing an IT role. This is so true. He further explains

Business stakeholders sometimes fail to realize (in part due to the BA or Project Management Organization’s failure to articulate) that the great value of a BA is not just in the ability to crank out documents translating business-speak to tech-speak, but to help business stakeholders through the processes of identifying and prioritizing true (not necessarily perceived) business need

I have experienced the above myself, pretending that they understand technology. The Stakeholders ofter define the technological platform they are going to use. These decisions are rarely taken after a thought process. The decisions are often taken because, the technology is "cool" or the competitor is using that, or 
Gartner has kept it on the top right corner of there magic quadrant. Not because its going to serve the business need, no body has time to do this. These decisions should ideally have taken place after the business case is developed by the Business Analyst, this not only gives a BA a lot of freedom to analyze without thinking about implementation when the technology is defined.

So what does the future hold? As Babcock opines:

I do feel that the role will continue to require business acumen and technical literacy, and I know that every company will continue innovate and build on past lessons to address their needs for the role as they see fit. In many smaller budget operations we’ll likely continue to see the systems analyst/business analyst hybrid. In other scenarios we’ll see the breakout.
As I indicated above, I think that organizations will realize the most value from the business analyst as he/she is included earlier and earlier in the business decision making process, and becomes more of a fixture within the business. Whatever the case, though, I trust that the market will properly guide the evolution of the business analyst role

Whatever the future holds a Business Analyst will play a very important role decision making process both on the client and the vendor side.

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