What is gap analysis?

What is gap analysis? For corporate strategic planning, the answer requires a narrowing of focus of the usual definitions of the technique.

Gap analysis compares two things, to measure the difference between them. Often gap analysis helps in comparing two different states of something - the current state and the future state. Once the gap is identified, one can look for ways of bridging the gap.

What is gap analysis in
strategic planning?

Gap analysis is a method that an organization can use to measure the difference between its current, and anticipated future. This assumes it continues with its present strategies. It also means having a desired or targeted future state to compare with. The method may sometimes be termed need-gap analysis, needs analysis, and needs assessment.

Applying gap analysis

Gap analysis can be conducted in situations such as the following -

  • In a system such as a computer software application the gap analysis maps functions or features that exist in the system now versus the functions required in the future.
  • Could gap analysis help in developing a user interface? It could be the data that a system provides to an interface such as an instrument panel or control dashboard now compared with the data that will need to be displayed in the future.
  • What about a set of operations forming a business process? In this case, gap analysis is assessing needs or gaps between activities or procedures of a current business process, and steps that will be needed in the business process at some future time.
  • In the context of strategic planning gap analysis focuses on organizational objectives and associated performance metrics. It evaluates how well an enterprise meets agreed targets, using specific performance indicators now against the targeted performance outcomes, using these same metrics at some point some time ahead.

just as with other strategic planning tools, one must be careful to use judgement. For some cautionary advice see the article Uses and Limitations of Strategy Tools.

Gap analysis involves comparing what is
with what should be

In summary gap analysis consists of -

  • listing of key factors such as performance levels of key value drivers as well as the overall level of corporate performance of the current strategies or "what is", and
  • stating factors involved driving outcomes for the future "what should be", and then,
  • highlighting the gaps that exist and need to be filled.

Gap analysis forces an organization to be clear on its current identity and performance, and challenge itself about what it wants to be in the future. It does so in clear, specific, measurable terms. This helps in designing or selecting specific strategies to fill the gaps.

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More information - Some of these resources may help you get a better understanding of gap analysis and needs analysis -

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