Gap Analysis: Identifying What’s Missing in Business Strategy

Have you ever tried assembling furniture without all the pieces? You know what the final setup should look like, but as you dig through the box, you realize you're missing a few screws. You can try to force it, but it won’t work well. This is exactly what happens when businesses try to achieve strategic goals without fully understanding what they lack.

That’s where Gap Analysis comes in.

What is Gap Analysis?

Gap Analysis is a method used to assess the difference between the current state of a business and its desired future state. As Business Analysts (BAs), our role is to find out what’s missing—those critical screws, so to speak—that are preventing the business from moving from point A to point B.

In short:

• Current State: Where are we now?

• Future State: Where do we want to be?

• Gap: What’s stopping us from getting there?

Gap Analysis helps organisations understand their shortcomings, uncover root causes, and take strategic action to improve performance and results.

Why is Gap Analysis Important?

Gap Analysis is a strategic diagnostic tool. Without it, businesses may:

• Waste time and resources on the wrong initiatives

• Set unrealistic goals

• Fail to address real issues affecting growth

When done correctly, Gap Analysis allows for:

• Clarity: Everyone understands the starting point and the destination

• Focus: Priorities become clear

• Accountability: Gaps are assigned to responsible teams or individuals

• Action: You get a step-by-step path to improvement

Step-by-Step Breakdown of a Gap Analysis

Here is how you, as a BA, can conduct an effective Gap Analysis:

1. Define the Current State

Collect data through reports, interviews, and observations. Identify how things are operating today.

Example: An insurance company has an average claim processing time of 15 days.

2. Define the Desired Future State

Work with stakeholders to clearly define what the ideal outcome looks like.

Example: The company wants to reduce claim processing time to 7 days to improve customer satisfaction.

3. Identify the Gaps

Now compare the two states. Ask: What’s missing? What processes, skills, tools, or resources are holding us back?

Example:

• Outdated legacy system

• Manual documentation

• Lack of trained staff

4. Analyse Root Causes

Don’t just list gaps—analyse why they exist. Use techniques like the 5 Whys or Fishbone Diagrams to drill down.

5. Recommend Solutions

Based on your analysis, suggest targeted and realistic improvements.

Example:

• Introduce an automated claim management system

• Train staff on new digital workflows

• Redesign internal SOPs for faster verification

6. Build an Action Plan

Prioritise gaps, assign responsibility, and develop a timeline.

A Broader Perspective: Where Gap Analysis Fits

Gap Analysis can be used across various areas:

• Strategic Planning: Aligning vision with capabilities

• Process Improvement: Identifying inefficiencies in workflows

• Technology Upgrade: Highlighting system limitations

• Skills Assessment: Mapping current employee competencies against future needs

Whether you are launching a new product, entering a new market, or improving internal operations, Gap Analysis provides a structured way to move forward with confidence.

Final Thoughts

Gap Analysis is not about pointing fingers. It’s about uncovering hidden blockers and creating a path to better outcomes. It makes you, the Business Analyst, the person who doesn’t just describe problems, but solves them.

So next time you're faced with a big goal, ask yourself: "What are we missing?"

That question might just lead you to the answer your business needs.