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What Is a Performance Gap Analysis?

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  • Written By: Jim B.
  • Edited By: M. C. Hughes
  • Last Modified Date: 25 August 2016
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A performance gap analysis is performed by a business that wishes to determine the reasons behind a disconnect between the standards set for a job and the actual performance being delivered. The difference between the standard and the actual performance is known as the performance gap, and businesses want to erase such gaps if at all possible. Such gaps might be cause by internal factors related to the employees or their working conditions, while other gaps can be caused by other factors like regulatory standards. In addition, a performance gap analysis is often performed when employees are forced to either take on a new task or revisit an old job using new methods.

It is unlikely that any business can perform up to their optimum standards at all times. For that reason, there may be occasions when a company has to take the time to analyze the areas in which it feels its employees or its operational processes are falling short. One way to do this is through a performance gap analysis, which can both identify the gap between standards and delivery and find methods to rectify the problem.

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The first step of any performance gap analysis is actually identifying the gap that exists. This can be done almost like a mathematical equation, as the difference between standards, or S, and present behavior, or B, leads to the performance gap, or G. Thus, S minus B equals G. Thinking of it in this concrete way can help managers identify problems areas that might be vague when analyzed without context.

After the gap is identified, the next step in completing a performance gap analysis is to figure out the reasons why the gap exists. A performance gap may be caused by either internal factors that are keeping employees from doing the job in the best manner possible, or by external factors that are limiting performance from the outside. In some cases, a new task will require this type of analysis, since a gap will be created immediately by the employees' unfamiliarity with the task.

Once all of these steps are completed, a company must finish the performance gap analysis by finding ways to eliminate the gaps. This might mean that certain machinery needs to be fixed or replaced, or that employees need more training or better motivational methods. If the factors are external, companies might have to find novel ways to work around them, or perhaps they can fight them through legal avenues. In some cases, it might that unrealistic standards have been set, meaning those optimum levels might have to be readjusted so that actual performance can hit the intended marks.

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