Business gap analysis and risk mitigation
Business gap analysis allows for risk mitigation through defining the present state, the desired state, and the gap that defines risk.
Business gap analysis checklist
- Business gap analysis requires you to be clear about the present state and the required state.
- Business gap analysis can only proceed when you understand the gap confronting you and its impact on risk mitigation.
- Business gap analysis should start with the desired state, expressed in a requirement document.
- Business gap analysis may require the services of a business analyst.
- Business gap analysis for risk mitigation may involve detailed, backward-chaining through logical sequences of actions and intermediate states.
- Business gap analysis procedures can show you how to reach a desired state from the present state, and the risks involved at each stage.
Business Gap Analysis and Tesco
To illustrate how business gap analysis is used in the context of a major supermarket, we will illustrate how various forward and backward-chaining business gap analyses might be used in the context of Tesco PLC.
Sales gap analysis report
Any business analyst working for a supermarket needs to know how to produce a sales gap analysis report in the general context of a business gap analysis. The business gap analyst should also stress how useful gap analysis can be in other areas, including team planning gap analysis, technical gap analysis, and educational gap analysis.
Customer loyalty gap analysis
In developing the Tesco Clubcard the desired state defined by the business gap analysis was greater customer loyalty. From there business gap analysis showed that loyalty could only be achieved if there is something to keep customers returning to Tesco. The Clubcard has two advantages here:
(i) It is a permanent, physical reminder in the customer's wallet.
(ii) The customer can only make significant amounts of Clubcard points by returning frequently to Tesco.
It is also important to determine the risks involved through using a business gap analysis. For instance, people dislike having to carry lots of cards around. Other supermarket firms, like Waitrose and Marks & Spencer, have missed a trick by not attacking Tesco in this area. An advertising campaign that stressed the irritation that people associate with Clubcards could hurt Tesco. Also, a negative advertising campaign could stress that money saved is used to reduce costs and improve the quality of products.
HR, skills sets, and business gap analysis
A high priority for senior management should be to find out how human resource management can use business gap analysis. For supermarkets, like Tesco, human resources (HR) are of the highest priority. Business gap analysis can be used to determine the gap between the current and desired skills sets of employees. This can be used to enhance employee development. Because Tesco has so many products and services, from grocery distribution to banking, the demands made on the HR gap analysts are many and varied.
The starting point for HR gap analysis is the CV of the staff member. This provides the best objective knowledge of the current state of the employee. For particular skills, from mental arithmetic to customer empathy, specific tests and questionnaires may have to be developed. These can supplement the information in the CV.
There are several kinds of documents, checklists and spreadsheets that would make the HR business gap analysis easier. These include:
- business gap analysis best practices
- skills gap analysis tools
Business process gap analysis
There are many paper and software tools that can be used for business process gap analysis on process improvement (see left margin for business gap analysis tools).
Many business gap analysis tools are available free on the internet. Also, try searching for useful business gap analysis techniques in Google by name. For example:
- Parasuraman Zeithaml business gap analysis model
If you are planning an ISO business gap analysis, or a business gap analysis for CSAA, you should contact the body involved to see if you can obtain useful tools, documents or other items. Make sure to specify the standard number (e.g., ISO 140012004, ISO 17799,...).
Security controls gap analysis
Business gap analysis and risk mitigation go together like bread and butter. Sample requirements documents for security procedures can be obtained from security firms, or even the police. These often stress technology solutions, but don't forget the human side of security control.
Other users of business gap analysis
Supermarkets like Tesco are not the only users of business gap analysis. If you are looking to perform a supermarket business gap analysis, don't just look at material on business gap analysis in supermarkets. Look at a wide range of material on gap analysis in completely different institutions (like telecommunications or politics).