SWOT Analysis or GAP Analysis? Which Should You Use to Evaluate Your Business
Both SWOT analysis and GAP analysis are used to evaluate businesses, but different aspects of businesses. However, output from one can be used as input for another and vice versa. This article will give a brief introduction to both techniques; how both connect with each other and give you some guidelines to drawing these diagrams. A SWOT analysis is frequently used by companies, while a GAP analysis is not used frequently.
What is a SWOT analysis
SWOT stands for strengths, weaknesses, opportunities and threats. It is sometimes referred to as SLOT analysis with liabilities coming in place of weaknesses.
- Strengths — Advantages the company has over other competitors
- Weaknesses — Areas that needs improvement compared to competitors
- Opportunities — Trends and market gaps to take advantage of
- Threats — External factors that can threaten your business
Identifying these factors and considering all of them together, makes it easier to plan your future activities. Adding all these factors within a diagram makes it easy to visualize and helps you make even better decisions. Plus you get to impress your peers with beautiful diagrams. Creately makes it very easy to do this by providing you with some beautiful templates. Below is one,
Related Reading: SWOT analysis vs PEST analysis
What is a GAP Analysis
In a business or a company, a GAP analysis compares the actual performance with the potential performance. Sometimes it is referred to as a need-gap analysis, need analysis or need assessment.
A company will determine the factors that define its current state, list down the factors needed to reach its target state and then plan on how to fill the gap between the two states. This is important, because it helps to identify if a company is performing to its potential and if not, why it is not performing to its potential. This helps to identify the flaws in resource allocation, planning, production etc.
SWOT Analysis vs GAP Analysis
SWOT analysis and GAP analysis can be used in various contexts, and they might give different meanings in those contexts.
Below is a breakdown of SWOT analysis vs GAP analysis in the context of a company.
- SWOT analysis evaluates a company against its peers, while a GAP analysis is an internal evaluation conducted to identify performance deficiencies.
- SWOT analysis is done for long term planning, while GAP analysis is often done to reach short term goals.
- SWOT analysis is often a comprehensive study evaluating many aspects and many competitors. On the other hand, a GAP analysis can be very simple and targeted towards fine tuning one process.
Visualization and Collaboration in Planning
When coming up with SWOT and GAP diagrams, collaboration and visualization play important roles. For example, in case of SWOT analysis, you need input from many people; so the process should be transparent to everybody.
This is where Creately’s real-time collaboration feature plays a critical role. You can share the SWOT or GAP diagram with a set of peers and edit it simultaneously. Because of real-time collaboration, you can see the changes each other make instantly, making it very easy to correct them. Check out SWOT diagram tools by Creately.
This article, originally published on the Creately blog, is slightly modified to fit Medium’s guidelines. To view the original article, visit this link;