Gap analysis is the art of identifying where performance or capability falls short of needs, and of coming up with an effective way of addressing that gap, also occasionally referred to as the ‘delta’.
That delta comes in one of two forms. The first is that there is a gap in capability. For example, you want to be able to paint your products, but have no paint shop in your organization.
The other form of gap is numerical, and occurs when an existing capability is not able to perform as desired. Missing on a KPI, or falling short of a stretch goal are common situations that require gap analysis.
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Gap analysis can be used in a variety of situations. A common application is when doing countermeasures to get back on track on Key Performance Indicators (KPI). When there is a miss, a countermeasure is developed to come up with a plan to close the gap. (Note: I’ve coined a term, “Countermeasure Calculus”, to describe the math that goes into making sure that the estimates in the action plan are enough to cover the gap in the KPI).
Gap analysis is also frequently used informally in basic, day-to-day situations. Imagine you have only 40 minutes until you have to pick up the kids from the sitter. You estimate that you still have a few errands to run and are about 10 minutes behind schedule. What do you do? You streamline your errands, eliminate some stops, or call the sitter to leave the kids there longer. Each of these actions is the result of your impromptu gap analysis.
Integrated in the gap analysis is almost invariably a look at costs. It is important to know the resources required to close the gap. If the cost is prohibitive, you may consider changing the goal.
Ultimately, the goal of gap analysis is to recognize the ‘delta’ before a serious problem arises.
Career Path Gap Analysis
An often overlooked application of gap analysis is in working out a career path. Many people think about what they want to do down the road, but few take a systematic approach to getting there. Career gap analysis requires that you look at the skillset you will need to perform in your desired future roles, and compare that to your current capabilities. Gap analysis helps you eliminate the skill delta, and improve your chances of landing the job you want.