The Nuts and Bolts of Gap Analysis

Gap Analysis, just as the words signify, is a process used by small businesses and corporations across the globe to identify and analyze the gap between their current state and the desired state. This means that the current performance of an organization is measured against the target outcomes, goals that were set to achieve and the performance standards that were originally planned and the difference between the two concludes where the improvements are needed to be made.

The strategic management approach, the total quality management approach, the quality control process, research and development, growth and innovation planning all involves intense practice of gap analysis. It not only identifies how far you are from your desired targets but also serves as a pre-requisite to dive into further planning and research. It is through the outcomes of this gap analysis that the businesses determine what they need to do next.

Conducting Gap Analysis

Various approaches are used by different professionals across different industries and fields of work, but a common approach as stated by Forbes include these four basic steps.

1. Current Situational Analysis

The current situation has to be analyzed with all its peculiarities and details. Some of the best tools devised by management gurus to perform such situational analysis include SWOT (Strengths, Weaknesses, Opportunities, threats) Analysis, PESTLE (Political, Economic, Social, Technological, Legal and Environmental) Analysis, BCG Matrix, Michael Porter Five Forces Model (to determine the level of saturation and intensity of competition in the industry)and numerous other such frameworks.

2. Clearly Specify your Goals

Your goals both in the longer and shorter run must be clearly outlined while you are performing your gap analysis. Remember these goals need to be SMART i.e. Specific, Measureable, Attainable, Realistic and Time Bound. Without these essential qualities in your stated goals, it may not be possible to achieve them. How will you able to reach a goal if it is too impractical for your current situation to reach there? Also, if a goal is stated without a time specification, how the gap analysis would be able to highlight how far you are from this goal.

3. Analyze the gap

Once you are done identifying where you stand currently, what your current performances and achievements are, as well as where do you want to reach, now you are in a better position to identify the gap between these two. Identify the shortcomings and what is causing this gap and why are you lagging behind in achieving your goals.
One thing to note here is that this gap can also be of two types: One- where you are falling short in your performance and the shortcomings are there, and the other- where you are yet to achieve some of our outlined goals. While it is normal to be on your way to achieving your goals, with some of them stil yet to be achieved, the shortcomings and failure to adhere to performance standards is something that must be taken care of immediately.

4. Establish a Plan

How that you have identified the gap and its type and the urgency that is needed to catch up on this gap, now you need to develop a plan to be able to do it. Consider both the current scenario and the targets to be achieved while designing this plan. All relevant stakeholders must be included in the process to make it as realistic and practical as possible.

5. Execute, Monitor and reiterate

The plan thus developed serves as the roadmap and must guide you each step of the way. Assign responsibilities to people and work through teams to be efficient and effective in the implementation of your plan. Execution of the plan will always have its own challenges and many iterations and revisions may be required throughout the process. Thus a 360 degree feedback and monitoring mechanism has to be implemented alongside to be able to trace what is going right and what is not. Doing this will enable to identify the things going wrong and can be taken care of simultaneously, instead of doing it all from the scratch again.

With this Gap Analysis plan, organizations can make their mark in growth, extension, research and development and corporate entrepreneurship and innovation. Since continuous growth and innovation is needed in all kinds of businesses, conducting gap analysis is not a one-time activity, rather a periodic process. Therefore, businesses are now not only developing standardized protocols for performing the activity but also preparing and hiring specialized professionals to get the job done.
Such specialized professionals, like the ones at Forbes, also prepare standardized templates as well for conducting gap analysis. These templates state the exact areas that are needed to be filled so that the ones working on it do not have to decide what to include and what not to. Businesses can make use of these templates as well to save their time and get accuracy in their analysis.