A 'Business Word' Example

'Improving management ability is the first step to removing the gap between current business performance and the expectation of the market'

Gap (Business Word) – Systemic (Integrated Aspect)

A 'gap' is a hole, an opening, a break, a breach, fissure or crack. It is symptomatic of a space or disparity. In business terms and in the context of management performance it represents the difference between one state and the other; or to be specific, the distance between the best efforts of the management in terms of productivity when measured against the satisfied customer; defined as the return purchaser. 

Any 'gap' presents opportunities to those that are able to take advantage and occupy the space. A 'gap' between supplier and customer allows other suppliers to take up the space and potentially purloin that customer. The 'gap' is symptomatic of a poor and weak relationship and suggests that the best efforts of the supplier are falling some way short of the requirements of the customer. Allowed to continue, the 'gap' in the relationship becomes a permanent break.

Customers need suppliers and vice versa; any 'gap' is evidence of a failing and strained relationship. The responsibility for this relationship is with the supplier, therefore any noticeable 'gap' is a reflection of the internal activities and capabilities of the supplier operating system. Those responsible for the system are the managers and management of the organisation. Consequently, any 'gap' in relations directly correlates to the ability and skills of the management.

The space between the best efforts of the organisation, when measured against the customer needs, is evidence of a 'competency gap'. These needs can be simply measured through customer retention and return purchase. A business that is losing market share, customers and revenue is suffering from a 'gap' of competency in their management team. This 'gap' is manifest in the variance and inequality of endeavour over income, process over profit. The 'gap' will not be bridged by working harder, as the problem is not about effort. It is about ability. It is the inabilities of management that are laid bare through the discernible display of the 'competency gap', specifically: planning, organising, controlling, leading and motivating skills*.

'Gaps' present opportunities to organisations and businesses alike in that they define where corrective effort should be placed in order to improve returns. If the best efforts of the management is delivering 80% expectation, the 'compentency gap' is represented by the other 20%. If it is reasonable to assume that the system**; the people, technology, environment and structure*** is performing to the best of its ability at any given time, then any and all corrective activities should only be aimed at those aspects of the whole system that are falling short in terms of performance.

As managers are in charge of the system, its outputs (measures) and outcomes (results), it is logical to commence any corrective actions in capablity with the management first and foremost. Improving management ability is the first step to removing the 'gap' between current business performance and the expectation of the market.

Gap Diagram

* Source: Bolton, W; 'Supervisory Management'; Pg. 24; Heinemann, (1986).
** Source: Emery, F.E. and Trist, E.L.; 'Socio-technical systems'; pp. 83-97; Management Sciences, Model and Techniques, vol. 2; Pergamon, (1960) cited in Miller, E. 'From Dependency to Autonomy', Studies in Organisation and Change Pg. 8, 27, Free Association Books; (1993).
*** Source: Cole, G. A.; 'Management Theory and Practice'; Pg. 72; The Guernsey Press Co; (1988).

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