What is a gap analysis of an enterprise, in what sequence is gap analysis carried out, how detailing and implementation is carried out, what the results depend on - this is discussed in the article.

From the article you will learn:

What is gap analysis or gap analysis?

Gap analysis of an enterprise in translation means determining the gap between the actual state and the desired one. A set of analytical studies helps to identify:

• the most problematic areas that currently hinder the development of the organization;
• assess the overall degree of readiness for the transition from the current state to the intended and desired level.

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Speaking of gap analysis, it is assumed that activities are aimed at identifying internal or external inconsistencies. There may be inconsistencies between:

• plans management team and understanding of performers;
• structure of assortment and demand;
• products manufactured by the enterprise and competitors;
• brand identity and its external perception.

The main purpose of a gap analysis of an enterprise is to identify opportunities to gain effective market advantages. Realization of hidden or little-used potential when using external opportunities, resolving conflicting demands of internal departments, for example, technological and marketing - this is the main task aimed at reducing the gap between what is desired and what is actual.

Gap analysis of an enterprise is often used in everyday practice, and is invariably used in strategic planning systems. A real assessment of the achievability and effectiveness of long-term planning, coordination and approval of the costs for which financial resources will be allocated, allows us to determine the payback of any projects.

By comparing the current situation with the desired state of affairs, a scheme for improving methods for achieving goals is determined. At the next stages, detailed programs for the development of the organization in the desired directions are developed. In difficult situations, project teams are involved, testing the decisions made, working through various situations and using mock-ups.

Gap analysis: an example of identifying gaps

The main categories of discontinuities are defined

1. sales market;
2. quality of products or services;
3. organizational management
4. business management;
5. business processes
6. information technologies.

Gap enterprise analysis: market gaps

Gap analysis- a method of analyzing primary information, studies the strategic difference between the desired - what the enterprise wants to achieve in its development - and the real - what the enterprise can actually achieve without changing its current policy. GAP analysis is an “organized attack on the gap” between the desired and actual reality of the enterprise.

GAP analysis allows, based on a study of actual and potential profit flows from the production and sale of various types of products, to identify market gaps (gap in English) that can be filled with new products.

The GAP competitive advantage analysis method was developed at the Stanford Research Institute in California. It is an attempt to find strategy development methods and management methods to bring things into line with the level of requirements. GAP analysis, or gap analysis, which has found widespread use as an effective method of strategic analysis, can also be used to diagnose a company's problems.

The essence of the method is to study the problem, which turns out to be a gap that arises during the implementation of the change plan, between these indicators and the results that were planned to be achieved, and what happened in reality.

The reasons for such a gap can be very different. Thus, the American researcher L. Alexander, having studied 93 organizations in order to determine which problems most often create a gap between plans for change and their actual implementation, identified the following as the most common:

• The change took much longer to implement than originally planned;
• During the implementation of the change, serious problems arose that were not anticipated or analyzed;
• Coordination of the activities of managers of individual change tasks was not effective enough;
• During the implementation of changes, crisis threats arose, which required the diversion of all forces and capabilities to overcome them;
• The skills and abilities of the workers involved in the change were found to be insufficient;
• The level of preparation and understanding of the change intent was inadequate;
• Uncontrollable environmental factors had an unfavorable impact on the implementation of changes.

The goal of using the method is to predict in advance the situations that give rise to such gaps, rather than later experience disappointment caused by failures to implement changes. Thus, with the help of GAP analysis, it is possible to find the optimal path from the current state to the desired one and identify restrictions imposed, among other things, by the state of organizational processes, functions and structures. The task is to select the best alternative for changes that will form the basis of the company's strategy aimed at increasing sales. In this case, the question should be answered: which strategy prevails: increasing sales volume by expanding the market or by capturing market share? If the company has chosen this parameter (sales growth) as a strategic goal, then two options can be used to achieve it.

Analysis Steps

• preliminary formulation of activity goals for one year, three years, five years
• forecast of the dynamics of profit margins in connection with established goals for existing enterprises;
• establishing the gap between goals and forecasts;
• identification of investment alternatives for each enterprise and forecast of results;
• determination of common alternative competitive positions for each enterprise and forecast of results;
• consideration of investments and pricing strategy alternatives for each enterprise;
• aligning the strategic goals of each enterprise with the prospects of the portfolio as a whole;
• establishing the gap between previous performance goals and the forecast for each enterprise;
• clarifying the profile of possible acquisitions of new enterprises;
• determination of the resources required for such acquisitions and the nature of their possible impact on the existing enterprises in the portfolio;
• reviewing the goals and strategies of existing businesses to create these resources.

Such an analysis can be carried out both in relation to a group of enterprises (associations) and an individual enterprise. Thus, GAP analysis can be called an organizational attack on the gap (closing the gap) between the desired and predicted activities. Since the 2000s, fuzzy gap analysis has been used. Traditional mathematical methods are based on classical logic and are intolerant of inaccuracy and bias of truth, as well as uncertainty in economic systems. In turn, the uncertainty of the system leads to increased risks from making ineffective decisions, which can result in negative economic consequences. For this purpose, there is a need for methods based on fuzzy logic.

To clarify, let’s take sales in units, or rather their levels. For example, there is a certain sales volume (point A), but you planned different numbers for this period (point B).

GAP analysis drawing

The picture shows a gap that needs to be measured. Point A - 2000 pcs. minus point B -1000 pcs. equal to 1000 pcs is the size of the gap. After we have calculated it, we need to develop measures to eliminate this gap (gap) and write them down point by point:
1. Increase advertising by... This will add plus 300 pcs. to current sales
2. Train sellers in N techniques. This will bring an additional 400 pcs.
3. etc.

We need measures that will add the missing 1000 pieces of goods to our sales.
As you can see, the use of this tool involves the collection of statistical information within the company and work on business analysis.

Translated from English, gap means difference or gap. Presumably, GAP analysis was first used in the USA, and was proposed by Stanford University (business school).

gap analysis model

In understanding the model, the principle of operation is important, which in this case comes down to identifying the difference between the planned and actual positions. There is no need to complicate anything, come up with coefficients and other methods of complication. As Meyer's law says, “To complicate is simple, to simplify is difficult.”
For situational analysis, small-sized enterprises should opt for

Gap Analysis (GAP Analysis)

One of the well-known methods of strategic analysis is gap analysis, or GAP analysis. gap– gap). When setting strategic goals, it is necessary to compare the formulated, desired goals with the realistically possible ones, i.e. determine the gap, discrepancy between these goals. GAP analysis is aimed at identifying such gaps, contributes to setting realistic goals and developing specific measures to eliminate (reduce) such gaps. With its help, you can organize a search for steps to achieve a given goal, determine the trajectory of transition from the achieved level of achieving a goal to the desired one. The condition for using this method is the existence of a gap between the desired and possible levels of achieving goals.

Figure 4.16 illustrates the content of the gap analysis of the sales increase problem. The management of a certain company has set a goal to double its sales volume over five years, bringing it to 30 million rubles. The long-term forecast of experts put the figure at 20 million rubles. Thus, a gap emerged equal to 10 million rubles. An analysis carried out by experts showed that the so-called operational gap can be closed through the following two groups of measures.

• 1) increasing the performance of the company, including marketing, by reducing production and marketing costs, expanding the range of products, etc.;
• 2) more complete use of market opportunities by changing the pricing policy, creating new sales channels, intensifying activities to promote products, etc.

However, these measures do not close the strategic gap. Its reduction is possible due to:

• 1) reducing the desired goal relative to sales volume;
• 2) market expansion: increasing market share at the expense of competitors, attracting new consumers, developing new market segments, entering foreign markets, etc.;
• 3) development of fundamentally new products, use of modern marketing technologies (CRM, partnership marketing), etc.

Rice. 4.16.

The following technology for conducting gap analysis can be proposed.

1. Determination of the object of application of this method.

These are objects of different levels (country, region, company, its divisions), whose activities are characterized by various indicators, measured quantitatively using certain methods, or some single indicator (market value of the company, sales volume, percentage of loyal consumers, birth rate etc.), or an integral indicator (an integral indicator of quality, some kind of rating, etc.).

2. Determining the desired level of achievement of the goal.

Often such goals are set by the organization’s management to its employees without sufficient justification. Determining the desired level of achievement of a set goal begins with a forecast of the state of the organization for the planned period using expert assessment methods or using mathematical forecasting methods. This technology allows you to assess what position your organization could occupy and calculate all the possible benefits that it would receive as a result of achieving the desired goal.

3. Based on the use of calculation and prognostic methods, often extrapolation, expert assessment methods, determining the possible achievable value of the goal (Fig. 4.17).

Rice. 4.17.

4. When the desired value of a goal is greater than its achievable value, the gap between them is determined.

In this case, the reasons for the rupture are analyzed. The gap between the desired and possible levels of achieving the goal by year of the period under consideration is detailed. If the possible achievable value of the goal exceeds its desired value, then there is no need for GAP analysis. Management simply did not take full account of the organization's capabilities; it is necessary to adjust the goal towards its greater value.

5. Identification of factors determining the occurrence of a gap.

The general gap is divided into specific gaps, the occurrence of which is due to certain factors (lack of finance, ineffective use of promotion methods, unreasonable pricing policy, strong level of competition, unfavorable demographic situation, etc.). All factors should be divided into controllable and uncontrollable. Gap analysis considers only controllable factors, the influence of which is possible only within the framework of the activities of the organization for which the gap analysis is carried out.

6. Analysis of the influence of individual factors and the possibility of improving their values ​​in order to eliminate (reduce) the gap.

A descriptive and, where possible, a mathematical model of the influence of individual factors on particular gaps and the gap as a whole is compiled. The information necessary to assess the degree of influence of individual factors on individual gaps and on the overall gap as a whole is collected. For example, a model of the demographic situation is compiled and how this model affects the personnel capabilities of expanding production is determined.

7. Determining the possibility of reaching the desired level of achieving the goal.

In the process of assessing the existing gap, it is necessary to find out to what extent the gaps can be closed. The possibilities of influencing factors of the micro-external and internal environment are determined in order to bridge the gap. Macro-environmental factors do not appear to be subject to influence. Various options for the development of these factors and the level of their influence are taken into account as certain given initial conditions, within the framework of which actions to bridge the gap are planned. If the gap is too large to overcome with the help of your own or attracted resources, it is advisable to either reconsider the desired goal or break its achievement into several stages, increasing the total period of time to achieve the desired level of the goal.

It is also possible that the possibilities will exceed the previously set desired goals. In this case, adjustments are made to the set goals in the direction of choosing a higher level of their achievement.

8. Drawing up an action plan to eliminate (reduce) the gap.

The selected goal is translated into the language of specific activities, separated into separate periods of time, their performers, the deadlines for completing individual planned tasks, the resources necessary for this and the sources of their receipt are determined. The set of such actions is quite well known and is described in many marketing publications. The main thing is to choose those that correspond to the situation under consideration.

Approaches to obtaining the initial data necessary to identify groups of factors (individual factors) influencing the occurrence of gaps, methods and sources for obtaining them can be borrowed from the SWOT analysis methodology. We are, of course, not talking about all the factors of SWOT analysis, but only about those that influence the occurrence of gaps.

From the above it follows that the scope of possible application of this method is very extensive. It includes all kinds of organizations at different levels of management of the national economic system. In their activities, especially when developing strategic plans, the task of setting goals for achieving certain values ​​of certain indicators arises, for example, doubling GDP, increasing the birth rate, achieving a certain value for indicators of market share, quality level, competitiveness, reducing inflation, etc. Using the gap analysis method involves setting quantitative goals.

TO merits Gap analysis methods include the following:

• 1) this method forces managers to evaluate whether the goals they set are realistically achievable. We consider, of course, only the analytical justification for setting goals, and not following Napoleon’s principle: “Demand the impossible - you will get what you want”;
• 2) a fairly clear logic for applying this method, which can be presented in the form of sequentially implemented individual stages of its implementation;
• 3) sufficient universality of the method in terms of its application for the analysis of various practical problems.

At the same time, this method of analysis has the following disadvantages:

• 1) a multifaceted complex structure of factors, sometimes difficult to identify. A concept that is simple in concept, however, becomes difficult to apply in practice. Achieving goals is a function of many variables, both controllable by the organization and uncontrollable. The presence of uncontrollable factors narrows the organization's ability to bridge many gaps;
• 2) in addition to the general logic of analyzing gaps, there is no clear methodology for carrying out the analysis at its individual stages and searching for ways to eliminate gaps. Methodologically, solving problems of different types based on gap analysis can be carried out in very different ways;
• 3) the need to use forecast data that has poor reliability and accuracy.

In addition to expert assessments, extrapolation forecasting methods are most often used when analyzing gaps. When they are used, past experience is used as a forecasting base and extended into the future. The assumption is made that objects and processes (country, industry, competitor organization, demographic

and market processes, etc.) develop evolutionarily in fairly stable conditions. It is usually recommended, as we said earlier, that the forecast period should not exceed one third of the duration of the estimated time base. However, in practice there are quite a lot of cases when, based on a time base of, say, five years, extrapolation forecasts are developed for 10–15 years. What accuracy of the forecast can we talk about in this case?

Most forecast errors when using extrapolation methods are due to the fact that at the time the forecast was formulated, it was more or less explicitly implied that existing trends would continue in the future. This is rarely observed in real economic and social life.

There are many examples of erroneous recommendations made based on the use of extrapolation methods. These errors in the forecasts were not of a mathematical, but of a purely logical nature: after all, the forecasting used time series that fairly well reflected the statistical material available at the time of the analysis.

The development of society is determined by a very large number of factors. They are closely related to each other, and not all can be directly measured. In addition, as society develops, sometimes unexpectedly more and more new factors begin to come into play, which previously did not influence the dynamics of the forecast object.

Time series may become an increasingly unreliable basis for developing forecasts as a country's economy becomes international and increasingly exposed to international factors. Without a good knowledge of the key factors influencing the dynamics of the studied parameter, their possible changes in the future and an assessment of the sensitivity of the predicted parameter to changes in factors, it is not possible to determine the predicted value of the studied parameter, and therefore the size of the gap, without major errors.

The above in no way detracts from the importance of extrapolation methods. Like any methods, you need to know how to use them. First of all, extrapolation methods should be used to determine breaks in a relatively short time interval of development of fairly stable, well-studied processes. Gaps should be determined on the basis of optimistic and pessimistic assessments of changes in initial factors, thus obtaining optimistic and pessimistic assessments of the predicted indicator. The actual forecast estimate usually lies between them.

In gap analysis, a forecast estimate obtained on the basis of extrapolation methods is used as an indicator of the possibility of obtaining a certain value of the forecast indicator. Let's assume that a forecast estimate of the sales volume for some product has been obtained. It says that under the same environmental conditions, structure and strength of the initial factors, the predicted value will reach such and such a value by a certain point in time. Managers who use the results of this forecast should answer the question: “Are this sales volume satisfactory?” If yes, then you need to make every effort to keep everything unchanged. If not, then there is a gap and it is necessary to use marketing and other tools, as well as try to influence certain environmental factors that can be indirectly influenced (for example, influence the activities of intermediaries, lobby for changes in certain tariffs, import duties). All these activities are aimed at ensuring that the desired sales volume is achieved.

Good day, readers of the blog about trading. Gap, or price gap, or window (in candlestick analysis), whatever you like, depending on where it occurs in the trend, carries different information for the swing trader. It can indicate to you the beginning of a new powerful movement in the price of a stock, whether the trend will continue or reverse. Such high information content that a gap carries makes it a valuable graphic element.

On this page we will analyze what a gap is, how to analyze a gap, and most importantly, I will tell you which gaps are formed by professional traders and which by beginners.

What is a gap?

This is a price gap on a chart where no trading took place. It can appear on any timeframe, but as swing traders we prefer the daily one.

A gap on a daily chart occurs when a security opens above the high (or below the low) of the previous day. Why is this happening? Because sellers or buyers en masse place buy or sell orders before the market opens. As a rule, this happens when important news comes out. Let's look at an example:

AOL had a daily high of $27.96 ahead of its earnings report. Their report exceeded expectations and caused excitement among investors. Buy orders began to be placed before the opening of the trading session. AOL opened the next day at $28.19 and went up. The result was a price gap of 23 points, where there were no transactions. This is the gap.

Filling the gap

Sometimes we hear a phrase like “filling the gap” or “the gap has filled.” What is it about?

When a stock trades within the previous price gap, we say the gap has filled. Look at the example:

For over a year, the price gap served as a resistance level until it was broken. Then the gap began to rapidly fill.

In candlestick analysis, price gaps are usually called windows. When a gap fills, the Japanese say “the window is closing.”

Some traders say that gaps always fill. Others deny it. I don't think this topic is worth arguing about. I just want to say: there are price gaps that fill over a long period of time, as well as those that do not fill for years. Maybe the latter needs more time? It's not that important.

Types of gaps

Depending on where price gaps appear on the chart, there are 3 types:

1. Gap to break– occurs when the price leaves the consolidation zone or, as the completion of some graphical pattern. Formed by professional traders.
2. Gap on the lead– occurs after a strong price movement, usually between candles with large ranges, and indicates the strength of the trend. Also called measuring. Indicates a continuation of the trend.
3. Gap at the end– occurs in the direction of the main trend and speaks of the final wave of purchases/sales before the trend changes. Formed by novice traders.

Gap analysis: professional traders and beginners

We have come to the main topic of discussion. When a price gap appears, it is important to understand who created it. If professional traders are behind this, then you can be sure that the trend will continue. If it was formed by novice traders, then most likely the trend is approaching a reversal.

First, remember one thing. Professionals buy after a wave of selling has occurred and sell when a wave of buying has passed. That is, this is the initial phase of the trend after a reversal, or breakdown of the level.

Beginning traders do exactly the opposite. When the price has been moving up for several days, they are afraid that they have missed a good opportunity and start buying. At this time, professional traders are already selling.

Here is an example of a gap formed by novice traders:

As you can see, emotions dominate here – they are not a trader’s best friend. Purchases are made after several days of growth in a row at the end of an upward trend.

Here's an example in the opposite direction:

The second price gap occurred at the beginning of the trend and was immediately followed by a rapid rise in the share price.

Now let's derive the rules:

• When you see a gap that appears at the beginning of a trend, after a wave of sales, or during a breakout of the previous extreme, then expect a rapid rise in price
• If a gap occurs after a long trend, then this signals its end.

Gap is an excellent indicator of the direction of price movement. It gives us great opportunities, like swing traders: they indicate the emergence of trends and the achievement of extremes. And it’s based on the psychology of different traders. Trading Blog thanks for your attention. Leave comments on the topic of the gap and its analysis. Trade wisely!