What is an opportunity analysis?

Opportunity analysis is a strategy of assessing potential of change or improving to increase income generation. The type of opportunity will vary, from small chances in the current manufacturing model that leads to a reduction in costs or increases overall efficiency, only after the introduction of new product lines that will increase the profitability for business as a whole. Whether the aim is to increase profits by reducing costs or by expanding the scope of the products offered, undergoing an opportunity analysis helps to understand what effects, positive and negative, is likely to take place if a certain approach is made.

With any type of opportunity analysis, three key questions should be answered to make the analysis effective. First, what are the advantages of performing this opportunity? Furthermore, what adverse effects are likely to occur when implementation occurs? Finally, how will the implementation of the overall Function of the Operation affect and is the result worth a change?

The first problem to be solved in performing opportunities analysis is to identify the benefits that the change will bring. For example, if the bread company decides to expand the product line by offering Hot Dog buns together with loaves, the benefits may be the need for current consumers who now buy buns along with loaves, which will lead to increased business profits. The analysis will be more detailed by the cost of the production process to be modified so that the buns can be created, how the packaging should be designed and what the unit price of the bun package is to be competitive on the market. If it is determined that the related costs can be compensated by the sale of buns and earn a profit for the company, there is a great chance that this opportunity is worth promising.

As soon as there is a value in watching the idea, the analysis of opportunities will focus on the possible negative effects of implementation of this new StraTegie. For example, how will it affect the production of buns for the production of loaves? If the production of bread is adversely affected by the fact that the company produces fewer loaves and cannot fulfill its production obligations to current sellers, profits from the bun production can be completely compensated, so that the company will not let free income to prove its efforts.

Any valuable analysis of opportunities must look at the effects of a long range associated with the change that is considered. This often means not only exploring problems with production and costs, but also intangible factors. If the addition of buns to the production process meant that consumers could not buy loaves they want, then it is likely that they will do business elsewhere, actions that effectively undermined from loave profits, but also reduce the consumer market for buns. The change should therefore have a negative impact on generating income in the long run and it would not be worth an effort.