Gap Analysis

The gap analysis process involves determining, documenting and approving the variance between business requirements and current capabilities.It is the comparison study of general expectation of performance in the industry and the level of performance at
which the company currently functions.

Gap analysis provides a foundation for measuring investment of time, money and human resources required to achieve a particular outcome (e.g. to turn the salary payment process from paper based to paperless with the use of a system).

Such analysis can be performed at the strategic or operational level of an organization.'Gap analysis' is a formal study of what a business is
doing currently and where it wants to go in the future. It can be conducted, in different perspectives, as follows:

Organization (e.g., human resources)
Business direction
Business processes
Information technology

Also

Banking and financial services organizations often ask this question, as they face the risk of missing or incompletely covered Business Requirements (BR) in Functional Specifications Documents (FSDs). This risk arises as business users may not always articulate their basic requirements under the misconception that development vendors know them already. However, that is not often the case because technology focused developers do not understand the nuances of banking like a domain specialist can.

Inconsistencies between Business Requirements and Functional Specifications result in critical requirement gaps later in the product life cycle. This often proves very costly for the client and the vendor, in terms of both monetary and reputation loss.