Every company is subject to making plans and, at a certain point, realizing that things are not going exactly as expected. This can occur due to external influences, such as rapid changes in the market and customer preferences, but also because of internal problems, such as communication and interpretation problems.
Because of this, it is very common for the need to question the business model and evaluate what is working well and what needs improvement. An interesting tool to help with this assessment is the Gap analysis, also know as Gap analysis.
Understand better what this method is and what benefits it can bring to your organization:
What is a gap analysis?
Gap analysis is a method used to evaluate a company’s actual performance against its potential. It examines the current performance to identify differences between the current state of the business and where it could or wants to be.
A Gap - or gap - is a dissonance that can arise from internal problems or not and that generates consequences, such as problems of understanding and interpretation, hindering decision-making.
Gap analysis can highlight how resources and assets are being utilized, making it easier to achieve business goals more efficiently, whether they are short- or long-term.
What is it for?
The purpose of carrying out a gap analysis is to help the company improve its commercial efficiency, its product or its profitability, as it allows it to identify gaps or points that need attention.
Once the analysis has been completed, the team's resources and energy can be directed to the areas that need improvement. This means that the Gap analysis serves to point out changes that could make the organization more competitive, as well as the risks and opportunities found during the investigation.
What are the benefits for business management?
In addition to answering questions about where the company is and where it wants to be, gap analysis offers several advantages, including:
- Helping the company review its current management approach and implement necessary improvements;
- Promoting greater team engagement with focused efforts and directed actions;
- Providing a broader view of the current management system;
- Allowing better resource allocation and improving ROI (Return on Investment);
- Facilitating the identification of market risks and opportunities.
How to perform a gap analysis?
A gap analysis can be applied to a specific department, a single process , or the entire company. The following steps are necessary to identify problems and determine how to address them:
1. Identify the current state
The first step is to determine which aspect of the company will be evaluated. The current state does not have to be purely financial; it can relate to various metrics or attributes.
2. Define the desired state
This is the time to identify goals to be achieved in a given period of time, which is the desired state of the organization. If the company has a strategic plan, it is possible to find the goals already established in it.
Maps and graphs can be useful at this stage, to facilitate a clear representation of the current and desired state.
3. Identify the gaps
A gap is essentially the difference between where the company is and where it wants to be. This is the stage to uncover why the gap exists. It's important to delve deeper and ask questions to determine the reasons behind the gap, such as whether the issue lies in the company's operations, customer relationships, or pricing.
4. Develop actions to close the gaps
After identifying the causes of the gaps, the next step is to devise the most appropriate actions to close them. Achieving viable and effective solutions requires considering the implementation costs of each action, evaluating available resources, and setting deadlines and milestones to track progress.
Finally, it’s crucial not only to conduct the gap analysis but also to ensure the proposed solutions are implemented and monitored for effectiveness. It's also essential to avoid attempting to address too many gaps at once unless they are interconnected. Otherwise, there’s a risk of overburdening the organization and failing to close any gaps effectively.
Now that you know all about Gap Analysis and how it can be done, you should also learn about Pareto Analysis and what it is used for.
