What is a Gap Analysis: How to Use it to Solve Problems (2024)

Every business wants to expand its operations and thrive in the market. But what happens when you have everything well laid out and yet fall short of expectations? This huge difference between the desired and real outcomes is why you should prioritize gap analysis.

Gap analysis is a technique used to determine the difference between where an organization currently is and wants to be. It's crucial at any stage throughout the life cycle of a business, but it’s more important when starting or looking at new growth models.

If you’re ready to create a gap analysis, you’re in the right place. In this article, we’ll discuss everything you need to know about gap analysis, including the gap analysis methods for solving problems.

Table of Contents

• What is a Gap Analysis
• Why Is a Gap Analysis in Business Important?
• When to Use a Gap Analysis
• How to Conduct a Gap Analysis
• 6 Types of Gap Analysis
• Top 6 Gap Analysis Methods
• Next Steps After Gap Analysis

What is a Gap Analysis

A gap analysis in business is a tool that allows you to get a clear picture of what is working and what isn’t. You can use it in business and project management to

• Pinpoint and prioritize areas for improvement
• Identify gaps in performance, knowledge, processes, or other areas

This will help you focus on those areas, leading to better results for your business.

What is a Fit Gap Analysis

A fit-gap analysis focuses on aligning a business process or system with an organization's goals and objectives. It is often used when implementing a new system or process.

During a fit-gap analysis, you’ll compare the current state of your business with the desired state (the "fit") and identify any inconsistencies between the two (the "gap").

Solving these gaps can improve the efficiency and effectiveness of the business processes, ultimately leading to better organizational performance.

Why Is a Gap Analysis in Business Important?

A well-conducted gap analysis helps you see the big picture by providing insights into your business's different areas. This process can help you establish what steps need to be taken to reach their goals and objectives.

Here is a look at the benefits in detail

1. Allows to Prioritize Areas of Improvement

One key benefit of gap analysis is that it enables you to recognize and prioritize areas for improvement. By understanding where you’re currently falling short, you can focus more effort and resources on the areas with the greatest impact.

These may include improving the onboarding processes and training employees. For example, if your training processes fall below expectations, Visme has everything you need to increase the impact of your training.

The tool offers various training material templates and other features to help create engaging training materials that deliver maximum results. Start creating interactive learning experiences using the template below.

2. Shields Businesses from Potential Pitfalls

Another important benefit of gap analysis is that it can help businesses avoid potential pitfalls and obstacles. You can develop strategies and solutions to overcome them before they become major roadblocks.

3. Gives Businesses Competitive Advantage

Gap analysis can also help businesses to stay competitive in an ever-changing market. Through regular gap analysis, you can ensure that you’re always working towards your business goals and staying ahead of your competitors.

Competitor analysis is an excellent example of performing gap analysis. Essentially you’re analyzing the gap between you and your competitors.

By analyzing your current and potential competitors, you can see where you fall short, improve on them and position your business for success.

When to Use a Gap Analysis

When to use gap analysis depends on the situation and the organization's needs. You can use it in various situations, such as when starting a new project, implementing a new system or process, or trying to improve performance in a specific area.

Here are the key situations where gap analysis can be an effective tool for your business.

1. When Planning a Major Transition

One common use for gap analysis is when you’re planning a major change or transition. This could include a merger or acquisition, a shift in business strategy, or the implementation of a new system or process.

In these cases, gap analysis can help you identify potential challenges and things you must address to implement the change successfully.

2. Performance Improvement

Another situation in which gap analysis can be useful is when you want to improve performance. By comparing the organization's current state to industry benchmarks or best practices, gap analysis can help you identify areas where you’re falling short and need improvements.

3. Support Decision Making

You can also rely on gap analysis to support decision-making. For example, if you’re considering expanding into a new market, a gap analysis will help you identify potential gaps in your company’s overall capabilities or resources. This will pave the way for addressing these gaps before implementing further steps.

How to Conduct a Gap Analysis

Let's run through the different steps involved in conducting a gap analysis.

Gather Your Team

Gathering the right team is an important step in conducting a gap analysis. It's important to bring together individuals with a deep understanding of the company's processes and operations and those with a broad perspective on its goals and objectives.

This could include representatives from different departments or functional areas and key stakeholders, such as executives and managers.

Organize brainstorming sessions by having these representatives participate. This allows for the consideration of all perspectives for a more comprehensive gap analysis.

Visme's whiteboard tool can be useful for conducting a gap analysis, as it allows team members to collaborate and visually brainstorm ideas. The tool provides a virtual whiteboard where team members can add notes, images and other visual elements to help communicate their ideas.

Visme also offers a broad range of templates specifically designed for structuring brainstorming processes and ensuring that all key areas are covered.

In addition to the whiteboard tool, Visme’s collaboration features make asynchronous and real-time collaboration super effective. You can invite team members, tag them, assign tasks, leave comments, and resolve comments.

Here's a whiteboard template to help you get started.

Identify Goals and Objectives

The next step is to identify the organization's goals and objectives. These goals and objectives should be specific, measurable, achievable, relevant, and time-bound, known as SMART goals. This ensures that the goals are clearly defined and can be realistically achieved within a certain time frame.

To set SMART goals, it is important to consider what the organization wants to achieve and why. For example, a goal of increasing sales by 20% in the next year is specific, measurable, achievable, relevant, and time-bound.

However, the goal of becoming the best company in the industry may not be as specific and lack a time frame.
It is also important to involve all relevant stakeholders in setting goals and objectives. Including a diverse range of perspectives will ensure the goals and objectives are aligned with the needs and expectations of all stakeholders.

Identify Key Metrics to Look At

Once the organization's goals and objectives have been identified, the next step in the gap analysis is to identify key metrics. This involves assessing the organization's current state and pointing out any gaps.

These metrics may include financial performance, customer satisfaction, employee retention, and operational efficiency. You can gain insights into these metrics by analyzing data and trends, conducting surveys and gathering feedback from stakeholders.

Measure The Existing Gaps

To measure existing gaps in gap analysis, follow these steps:

• Find out the desired outcome or goal. This could be a specific target, a set of performance metrics, or the desired level of customer satisfaction.
• Collect data on the current state of the organization or process. It may include metrics such as efficiency, quality and customer satisfaction.
• Compare the two states and document the findings. You can then present these findings to the relevant stakeholders through a report or visual representation of the gaps and root causes.

Remember to consider both quantitative and qualitative data when measuring existing gaps. It provides a more comprehensive understanding of the current state and helps identify potential solutions to close the gaps.

Create A Plan to Address the Gaps

The next step is to create a plan to bridge the gap between the current and desired states. Addressing these gaps may involve implementing new processes, training employees, or investing in new technology.

Set Benchmarks and Timelines for Addressing Gaps

Ensure the plan is specific and actionable and includes timelines and benchmarks for measuring progress. Create captivating timelines in minutes using Visme’s timeline maker. You’ll find templates for different use cases, including project management, product development, business, marketing and more.

Types of Gap Analysis

Now let's run through the different types of gap analysis and how you can apply them in a project or business setting.

1. Strategic Gap Analysis

This gap analysis helps in identifying strategic planning and decision-making gaps. It involves comparing the organization's current state against its desired future state and identifying the steps needed to close the gap and achieve its goals.

2. Financial/Profit Gap Analysis

This gap analysis focuses on the organization's financial performance and compares its current performance against its desired financial goals. A financial gap analysis will help you identify areas to improve financial performance and increase profitability.

3. Skill Gap Analysis

This type of gap analysis focuses on the skills and competencies of the organization's workforce. Through the skills gap analysis, you focus on comparing employees' current skills and competencies against the skills and competencies required to achieve the organization's goals.

You can rely on skill gap analysis to identify gaps in the workforce and develop training and development programs to bridge those gaps. Visme has all the tools you need to make this possible. The tools also give you an array of options for feedback.

Watch the video below to learn how you can use our flowchart maker to create mind maps, concept maps, SWOT analysis and more.

4. Compliance Gap Analysis

This gap analysis ensures that the organization complies with relevant laws, regulations and standards. It involves comparing the organization's current state of compliance against the requirements of these laws, regulations and standards.

5. Product Development Gap Analysis

This gap analysis focuses on comparing the current and desired product development processes. Product development gap analysis will help you identify gaps and areas for improvement in the product development process and develop strategies to bridge those gaps and improve your products.

6. Market Gap Analysis

This type of gap analysis focuses on the organization's market position and involves comparing its current market position against its desired market position. The outcome is handy in developing strategies to bridge those gaps and improve the current market position.

Top 6 Gap Analysis Methods

There are different methods for conducting gap analysis. These methods are key to earmarking key areas for improvement, prioritizing actions and creating a plan to achieve goals.

Here’s a basic overview of each framework and the right Visme template to use.

SWOT Analysis

When it comes to gap analysis, SWOT analysis is one of the most popular methods. SWOT stands for Strengths, Weaknesses, Opportunities and Threats, and it's a great way to identify the gaps in your business.

First, you'll need to examine your strengths and weaknesses. What are your company's weaknesses? What can you do better? Next, look at your opportunities and threats. What are the threats posed to your business and what opportunities can you capitalize on?

Once you have a good understanding of these four factors, you’ll be in a position to identify the gaps. Use this information to make strategic decisions and improve your business operations.

With Visme’s predesigned whiteboard template, you can effectively conduct a thorough SWOT analysis. You’ll find cool features and tools to help you collaborate easily with your team from start to finish.

Seamlessly review your business' strengths, weaknesses, opportunities and threats with this template created by professionals to help you solve your business goals.

The McKinsey 7-S Framework

The McKinsey 7-S Framework is one of the most popular gap analysis methods. It's often used in business and management, but you can apply it to any project.

The framework allows you to identify seven factors that need to be aligned for a company to succeed. These include strategy, structure, systems, shared values, style, staff and skills.

Let's take a look at each one.

• Strategy is the long-term plan for achieving objectives
• Structure is how the organization is organized and how work is divided
• Systems are the processes that are in place to support the organization's activities
• Shared values are the beliefs and principles that guide decision-making
• Style is the way that the company communicates with its employees and customers
• Staff are the employees who carry out the company's strategy
• Skills are employees' abilities and knowledge to do their jobs effectively.

The McKinsey 7-S model is applicable in many situations, such as understanding how various parts of an organization collaborate to make decisions on future corporate strategy.

Jumpstart your gap analysis method using our fully customized infographic template.

Feel free to customize the template, add interactive elements and keep your content on brand using our AI-powered Brand Design Tool.

Fishbone Diagrams

Fishbone diagrams are all about creating a cause-and-effect relationship. When creating a fishbone diagram, start by brainstorming all the potential causes for the problem you're trying to solve.

Next, get creative and think of the potential causes for each effect. Once you have a good list, start sorting them into categories (such as environmental, political, economic, social, etc.) and then drill down further into specific causes.

You can include easy and intuitive data widgets to visualize all kinds of data you need. Visme’s data visualization tools are all you need to easily translate statistics and figures into beautiful and meaningful visuals.

The great thing about fishbone diagrams is that they help you identify the potential causes of big and small problems. This can be helpful when it comes time to develop a solution.

Uncover problems within your tasks, systems or process using this technical problem fishbone diagram template.

PEST Analysis - Political, Economic, Social and Technological Factors

PEST analysis is a framework most businesses use to track and monitor the Political, Economic, Social and Technological (PEST) factors that may impact their business.

The PEST factors are:

• Political: Government regulation, taxes, trade restrictions, etc.
• Economic: Interest rates, inflation, economic growth, etc.
• Social: Demographics, culture, education levels, etc.
• Technological: Technology trends, research and development, etc.

You can use PEST analysis to track and monitor these external factors and plan for any potential impacts. For example, if the government Introduces a new law that will impact how your business operates, you can use PEST analysis to plan how you will adapt your business to comply with the new law.

Not sure how to conduct your PESTEL analysis. This PESTEL analysis whiteboard template has everything you need. All you need to do is input your own text, switch color, add other interactive elements and your analysis is ready for use.

Nadler-Tushman Model of Congruence

If you want to get into the nitty-gritty of how different parts of your organization interact, the Nadler-Tushman model of congruence is a great tool.

The model looks at how different elements of an organization work together and how changes in one element can impact the others. For example, if you're looking at a change in strategy, you need to consider how that will impact your structure, systems, staff and so on.

To use the model, start by mapping out the different elements of your organization. Then you look at how they interact and identify areas of potential conflict. From there, you can think about how to make changes that will improve the overall functioning of your organization.

It's a complex process, but it can give you many insights into how your organization works and how you can improve it.

Made with Visme Infographic Maker

Don't worry about the details! When you sign up on Visme, you'll have access to our library of templates that will walk you through the process step by step.

Mind Maps

Mind mapping involves using visual diagrams for gap analysis. It's a way of brainstorming by creating a diagram with your thoughts.

To create a mind map, you start in the middle of a piece of paper and write down your main idea. Draw branches off that main idea and write down related thoughts. You can keep going until you have a comprehensive diagram of your thoughts.

Once you have your mind map, you can start to see where the gaps are in your business. There may be a product or service that you're not offering that your customers want. Or there's a process you're not following that's causing problems.

Mind mapping is a great way to get your thoughts down on paper so you can start seeing the bigger picture. And once you see the gaps, you can start to fill them.

We’ve got a rich library of mind map templates to inspire you to create yours. Uncover gaps in your product, system or process using the mind map template below.

Next Steps After Gap Analysis

Once you complete a gap analysis, the job doesn’t end there. The next steps should focus on closing the identified gaps and achieving the desired state.

Let’s show you how you can do that.

Prioritize Identified Gaps

After conducting a gap analysis, the first step is to prioritize the identified gaps. This means looking at each gap and determining the most important ones to address. Prioritizing the gaps will help you focus efforts and resources on the areas with the greatest impact.

Capture the findings of your gap analysis using this beautiful report template. It features a beautiful collection of fonts, photos and creative content blocks — everything that’ll help you bring your content to life.

Develop a Plan

After prioritizing the gaps, the next step is to develop a plan to address them. This plan should include specific actions you'll take to close the gaps and the timelines for action. The plan should also include the resources needed to implement the actions, such as additional staff, training, or funding.

Take advantage of our wide range of templates to document and share your plan.

Implement the Actions

The next step after developing a plan is to implement the actions outlined in the plan. This may involve changing the organization's processes, procedures, or systems. It may also involve providing additional training or support to employees.

Monitor the progress of the actions and make any necessary adjustments to close the identified gaps successfully.

Review and Iterate

Finally, it is important to regularly review and assess the gap analysis results and the actions taken to address the gaps. This will enable you to determine whether the desired state has been achieved and identify any new gaps that may have arisen.
Regular review and assessment will also help you continually improve and stay ahead of competitors.

Create a Dynamic Gap Analysis with Visme

Are you looking to improve your business' or organization's performance and identify areas for growth? We’ve covered everything you need to know in this article.

The best part? Visme's powerful gap analysis templates put you one step ahead. You can collaborate with your team and create a dynamic and comprehensive analysis of your current and target states. By highlighting the gaps and opportunities for improvement, you can achieve your goals and drive success.

Don’t be left behind on this great opportunity to take your business to the next level—start creating a dynamic gap analysis with Visme today!