Secret To Winning? – Extend Your Competitive Advantages And Reduce Your Competitive Disadvantages
I had an interesting conversation the other day. We were talking about how to move the needle on job growth and build a sustainably stronger economy. Of course none of us had an obvious solution to the challenge. But, from a process perspective, the solution can be found through classic gap analysis.
What Is Gap Analysis?
According to BusinessDictionary.com, Gap Analysis is –
“A technique for determining the steps to be taken in moving from a current state to a desired future-state. Also called need-gap analysis, needs analysis, and needs assessment.
Gap analysis consists of (1) listing of characteristic factors (such as attributes, competencies, performance levels) of the present situation (“what is”), (2) cross listing factors required to achieve the future objectives (“what should be”), and then (3) highlighting the gaps that exist and need to be filled.
In my experience, Gap Analysis is a great way to identify and prioritize the highest impact business climate improvements that can be made to help ensure the long-term success of companies in your community. But a Gap Analysis must be done correctly or it can be a colossal waste of time.
3 Tips For Conducting a Gap Analysis
- Accept That You Are Not The Expert. It doesn’t matter how much experience you have from working in or with an industry. As an economic development professional you cannot be certain you know what is needed to accelerate discontinuous business growth. Consultants are not the experts either, although they can be very helpful in facilitating the gap analysis process for you. The experts are executives working in the industry. You should seek input from relevant executives in your community to understand how they see the present situation (“what is”) and their view of how they wish the business climate was (“what should be”). Then ask relevant executives from outside your community for their input.
- Benchmark Your Community Against Best In Class. There is a lot to be learned by studying the business climate of communities that are doing things right. Identify what is available in their community, but missing in yours. However, don’t fall into the trap of assuming that you can succeed by making a carbon copy of their business climate. How the parts are connected is often just as important as what they are. The interconnectivity is often overlooked, but it is typically the critical grease that makes the entire system effective. In many cases, the interconnectivity is relationship and trust based, two things that are virtually impossible to copy correctly. It is better to design a business climate customized for your community. Benchmarking helps you identify the most productive “rocks” that may be for you to turn over and explore further.
- Be Practical. You can’t change everything at once. The time horizon of your plan needs to be realistic. That means hard choices on prioritizing the business climate gaps to pursue closing in your community need to be made. The probability is that you will find gaps in three major areas – 1) assets, 2) infrastructure, and 3) public policy. Your business climate improvement plan will describe how to fill the gaps and the expected impact on your community’s economic prosperity. How do you decide which gaps are the highest leverage to close? You go back and ask the executives for their perspective. They are in the best position to give you advice, and by involving them you improve the odds they will be advocates of the change you need.
I believe Gap Analysis is a team sport. Don’t try to do it alone. Involve both your public and private sector leadership. Their support in resourcing the final Gap Closing Action Plan is absolutely critical to success. Recognizing you are not the expert is a huge help because it opens you up to really listening to what the executives in your community believe they really need for success.
When you decide you want to create a better future for your community, consider conducting a Gap Analysis.
What Are Your Thoughts?
What has your experience been in trying to create strategic plans to improve your community’s economic success? What has worked for you? What has not worked that well? Do you have any tips to share that might improve the odds of success for any colleague working on designing a better future for their community?
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