A needs analysis or needs assessment can be conducted in more than one way, but all these ways share one point in common: Organizations conduct a needs analysis to determine how best to make use of limited resources so they can improve processes without wasting any money or time. The most important element of a needs analysis is deciding which needs have the highest priority.
The Needs Analysis
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One of the simplest frameworks for a needs analysis is the three-stage comprehensive needs assessment used by the United States Department of Education. This method defines a "need" as the difference between the way things are and the way they should be. The first stage in the process is to determine the facts about the current situation and identify areas for potential improvement. The second stage is to identify needs by gathering information. The third stage is to define the needs and make a plan to address them. For instance, a business might conclude that deliveries currently take five days on average -- a pace that might not be competitive. If research shows that competitors are averaging three-day deliveries, this is the difference between the way things are and the way they need to be. The company needs to cut delivery times by at least two days to remain competitive.
Multiple Needs
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A needs analysis will rarely uncover just one need. In the real world, multiple stakeholders have multiple needs. Some of these needs will rate more highly than others. For instance, a nonprofit organization seeking to reduce underage drinking rates might consult young people to find out what their needs are, but the organization is unlikely to rate the need of people in this demographic for socialization and entertainment anywhere near as high as the need to reduce drunken driving deaths. A business with multiple departments and projects may find that every group in the organization has its own needs and priorities. It will often be impossible to meet all needs equally, so the needs analysis must identify which needs have the highest priority when it is not immediately obvious.
Consequence and Criticality
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The primary factor that determines the priority of a need is how critical the consequences will be if the need is not met. If a company is trying to cut delivery times by two days to remain competitive, the consequence of failing to do so could be the loss of all customers to more efficient competitors. One a scale of one to five, losing all customers would certainly rate a five. If the manager of the shipping department would rather quit than change the processes he's familiar with, then losing an experienced shipping manager is also a consequence. However, compared to losing all customers, this consequence might only rate a two out of five. Improving shipping times is the higher-priority need.
Correction Difficulty
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The final determinant of what needs have the highest priority is how difficult it would be to correct the problem. If two needs both rate three out of five, but one can be addressed with a simple process change while the other can only be addressed by buying an expensive new piece of equipment, the need that can be addressed quickly and easily has the higher priority. To get the most out of a needs analysis, zero in on whatever is most critical and fix what can be fixed most easily before you try to tackle anything more difficult.
