Many firms struggle to start and establish business with continued growth in the market. The strategic departments must realize and successfully use the gap analysis tool to grow the organization. It should be a continuous process that allows the organization to gauge its current status versus its desired one.
Gap analysis is a method that businesses use to measure their effectiveness. It helps to determine whether the company is meeting its requirements. If it does not do so, then the gap analysis provides the steps needed to achieve the objectives (Franklin 301). The gap analysis also refers to the challenges a business needs to sort to achieve its objectives. Other names for Gap analysis are the needs analysis and or needs assessment (McCracken 420). It can be useful to individuals in an organization. Project managers and process improvement teams can also use it (Franklin 301). Businesses can use it when they are planning on how to allocate resources. One can also use the gap analysis to compare one process to others performed elsewhere. The results of the comparison can help to support the maintenance of the current system, the entire adoption of an alternate process, or a fusion of different aspects of each process (Gould 260).
Gap analysis is very fundamental to any business that wants to grow. Some of those gaps may appear too small to cause any problem to the organization. But they slowly grow to become major problems. For instance, if the management fails to listen to the staff’s contribution and complaints about a period, they may use unions to fight for their rights. They may even abstain from working for the enterprise or cause a damaging strike to the business (McCracken 420). The organization may face court cases related to workers’ grievances. The company may also have to put up with high staff turnover that may affect the Human Resource budget for hiring and training. The strategy department has a role to play. It needs to make its planning and implementation cost-efficient and successful. If it does not examine the gaps within its strategies, it may not have the means and ways to stop them from manifesting into major problems that would be very serious.
The organization can follow the most common method to perform a gap analysis. The first step is to establish the specific target objectives by looking at the business’s mission statement, strategic goals, and improvement objectives (McCracken 420). The strategy department can identify the current and future state of the organization. It would include the current status of the business, the processes, and the characteristics that need improvement (McCracken 420). One needs to use factual and precise terms. The plan can be useful in examining the entire business. It can also focus on one part of the company with the company’s available objectives. The analysis can be quantitative or qualitative. Depending on the kind of analysis, there are various sources for obtaining the information. One can look at the documentation, conduct interviews, brainstorm, and or observe project activities (Gould 260).
The objectives provide information on where the business wants to be after completing the projects (McCracken 420). Just like the current state, the outline can be quantifiable (Gould 260). It could include aiming to increase the number of sales by a given percentage for a particular period. It can also have a broader perspective, such as improving the working conditions of the workers (McCracken 420).
The next step is to describe the gap. The first one needs to find out whether a gap exists between the organization’s current state and its desired outcome. The descriptions can be in quantitative terms or broadly described.
The organization needs to find out how to bridge the gap. The model provides an avenue for finding any possible solutions to the current state. The objectives need to be concrete and directly target the gap descriptions (McCracken 420). The strategies need to be practical and actionable.
A company may choose a gap analysis tool that suits a particular set of target objectives. One of the methods used is the McKinsey 7S Framework (McCracken 420). The 7S model examines the characteristics of business through the lens of seven people-centric groupings (Gould 260). They include strategy, shared values, structure, skills, style, systems, and staff (McCracken 420). The tool provides information about the current and desired state of each category. It would then be the work of the analyst and the organization to provide solutions to the highlighted problems.
The acronym SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. The tool looks at the internal strengths and weaknesses and external opportunities and threats. The factors affect the effectiveness and success of the entire business, its product, people, or projects. The company can then find the best suitable solutions by capitalizing on the strengths and opportunities available (McCracken 420). The distribution of resources and strategic planning must be carefully thought out so that the business deals firmly with its threats and weaknesses.
The Nadler-Tushman model seeks to explain how an organization’s processes are inseparable (McCracken 420). The failure in one part can result in a damaging effect on the other end. The model divides the organization’s operations into three; they include the inputs, transformation, and outputs (Gould 260). Input includes the resources, culture, and people (Franklin 301). Transformation involves the people, the processes, project activities, and existing systems (McCracken 420). The outputs section concludes the model. The model explains how inputs and transformation functions greatly affect the whole process, and hence creating gaps (Franklin 301). Whenever there is a deficiency in the inputs and disorganization in the transformation, it leads to failure on the part of the output. The problems witnessed in the outputs can easily relate to the problems that started in the input and the transformation area. It shows how the various components fit together for the success of any business activity. A company can only perform better if these systems are congruent. If there are few resources like the raw materials, and the manufacturing process has a problem, then the output products would not suffice the market.
During policymaking, an organization may come up with more than one policy and would like to affect the most important one. Gap analysis would be the best tool to determine the best plan. If Company A finds itself in such a state, the analysts need to compare the policies versus the organization’s core values (McCracken 420). The best policy would connect with the core values and vision of the organization. The policy must not be too broad to address the critical issues. It should also not be too narrow such that it leaves many questions unaddressed (Franklin 301). Gap analysis can also help in the strategy procedures. When the business is establishing its strategy, it employs the gap analysis method in its systems to develop a comprehensive plan. If every step seeks to fill the gaps available for the success of the organization, then it makes its entire process successful (Franklin 301).
The strategy department exists to lay down necessary plans for the business. It deals with everything required by the organization for continuous planning, monitoring, analysis, and assessment to meet its goals and objectives (Gould 260). It develops plans and policies while analyzing strengths and weaknesses that help shape the business environment. It formulates, executes, and evaluates to what degree the action plans have been successful and makes changes when desired results are not being produced (Franklin 301). It necessitates a commitment to strategic planning (McCracken 420). There would be a need to identify the key objectives of the department for the business. Discovering the required skills in the unit is essential for the continuity of the enterprise. For example, a medical institution would not have a strategy department filled with people who do not have medical expertise and experience. The institution would have to outline the desired outlook and compare it with the present status. The strategy department would have to meet with the top management, lay down its findings concerning the organization’s strategy. It would then conduct research that would involve the staff, the customers, the suppliers, and other relevant stakeholders. It would analyze the results and compare them with the company goals and objectives. It should find the gaps and address them with the recommendations from the study (Gould 260).
The gap analysis provides avenues for one to identify the deficiencies in the study. While examining the company’s goals and objectives, one can know where the business wants to be. The strategic vision gives the analyst the benchmark (McCracken 420). The analyst would then compare with the findings from the gap analysis to see the current status of the organization. The comparison in the model would help the analyst to identify the missing links and what needs to be done to achieve the desired outcome. The key improvement areas would help one to lay down the initiatives to reach the goals and vision.
The organization would have to use the gap analysis to assign the significant resources to the desired locations. For example, if the model states that the manufacturing department does not have enough raw materials, the management would have to allocate enough funds for the raw materials. The initiatives must be specific and target the outlined problems (Gould 260).
The best initiative that best fits the organization would be the one that helps to fill the gaps and solve the problem once and for all. The action must support the organization’s vision, goals, and objectives. It must also be the one that beats the other suggested solutions to solve the problem quickly and efficiently (McCracken 420).
Gap analysis is the best tool for finding the problems that face an organization’s development. It also helps the organization to determine and solve the issues that affect organizations. Every business that wants to succeed must employ this tool and use it effectively.
Franklin, Maren. Performance Gap Analysis, Alexandria, Va: ASTD Press, 2006. Print.
Gould, William A. The Puerto Rico Gap Analysis Project, Río Piedras, P.R: U.S. Dept. of Agriculture, Forest Service, International Institute of Tropical Forestry, 2008. Print.
McCrackan, Andrew. Practical Guide to Business Continuity Assurance, Boston: Artech House, 2005. Print.