What is a 'gap analysis'?

A 'gap analysis' is a method of comparing the current state of business performance with the desired state or goals that an organization aims to achieve. This analytical approach helps identify the gaps between where a business is currently operating and where it wants to be in terms of performance, processes, or capabilities. By systematically assessing these differences, businesses can develop targeted strategies to bridge the gaps, thereby improving overall efficiency, productivity, and alignment with organizational objectives.

The concept is crucial in strategic planning and can influence various decision-making aspects, such as resource allocation, training needs, and process improvements. It allows organizations to focus their efforts on specific areas that require enhancement, ensuring they can effectively reach their desired outcomes and improve their competitive stance in the market.