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Closing the Gap
Further Reading

This is the moment of truth in strategic planning. Identifying the gaps between current performance of the organisation and the performance required for successful strategic performance is a reality test of the commitment to planning. Here we find out what the challenge really is.

If the gap analysis does not show any discrepancies between what is and what needs to be done then there is shortcoming with the planning team. Gap analysis shows how large the gap is, and how far we must leap to cross it. It tells us about the resources available to deal with the gap.

Gap analysis involves careful decision-making. If gaps cannot be bridged, then the planning team must go back to the planning stage and revise the plan. Perhaps future vision must be re visited or expectations moved to areas that more closely oriented to achievable outcomes.

There are two ways to reduce the gap:

• The transactional solution is to modify or reduce the goal or objective.
• The transformational solution identifies and reduces the obstacles that are responsible for he gap.

Without input from other stakeholders, the planning team may be so positive in their attitudes that they do not see gap, or they may not see a possibility of closing a gap. Creative thinking may come from any part of the organisation.

The outcome of gap analysis should be a plan that is feasible to accomplish. Priorities will be based on reality of the resources.

Closing the Gap

• Internal expansion

1. Risk should be calculated.
2. Needs financial and other resources.
3. Needs additional demand for services or products.

• New line of services (LOB)

1. New lines of business are difficult to establish.
2. May be high risk.
3. Knowledge of the clients needs is important and reduces the risk.

• Acquisition and mergers

1. Consider the impact of these modes of growth on values.
2. May be successful in one situation and not in another.
3. Matching of the organisational culture of each organisation is important.

• Strategic Alliance

1. Turning competition into collaboration.

 

• Planning Tactics

1. Lengthen the time frame for accomplishing the objectives.
2. Reduce the size or scope of the objectives.
3. Reallocate resources to achieve goals.
4. Obtain new resources (last, not first on the list).

Tools:

Click to go to GAP Tools

Goodstein, L. D., Nolan, T. M., & Pfeiffer, J. W. (1993). Applied Strategic Planning: A Comprehensive Guide. Amsterdam: Pfeiffer. Chapter 11.