What is and how to make a business diagnosis

what and how to do business diagnosis
Excel Spreadsheets

Many entrepreneurs often act by putting out fires. The feeling is that problems are being solved. But as time passes, the pile of problems only increases. This is because a business diagnosis it was not done before. It would help the manager know where to focus before starting to run.

In this article we will talk about:

What is a business diagnosis?

The corporate diagnosis is a methodology for evaluating companies that allows an in-depth analysis of the main areas of business management. With a deeper understanding of the organization, it is possible to solve problems in a practical and directed way to what really matters and without spending time on minor items.

Business Diagnostics Worksheet

At LUZ, we use a question, answer and feedback method to assess the 5 main areas that every business has:

  • Strategy
  • Finances
  • Marketing
  • Human Resources
  • Operations

what and how to do business diagnosis - most important areas of management

Even knowing what the business diagnosis is, you may still be wondering how this method really will help you.

Benefits of making a business diagnosis

That is why I decided to bring the main benefits and results that a manager will have when implementing this methodology on a daily basis in his business. Basically, the diagnosis will help you to:

  • Understand which areas are most important to your business - not everyone realizes this, but each company has more important areas and, depending on this importance, it must create action plans and strategies based on what is most important.
  • Compare your current performance - There are usually two very useful comparisons here, with your minimum recommended performance and the minimum you want. The ideal is that you are always above both, but understanding each of these levels can direct what needs more attention and what can wait a little longer.

how to interpret the results of a business diagnosis - desired score

  • Discover the degree of maturity of your company - understand if you are on a very amateur level or if you are already mature enough to pursue new goals. This understanding can greatly help in establishing business strategies and purpose.
  • Understand what needs to be done and where - just knowing the overall performance of your company may not be enough, but with the business diagnosis it is possible to know exactly where the errors are and what your company is failing to do to reach a new level of management.

what and how to do business diagnosis - targeting what to do

But a question that can arise when thinking about all these benefits is in relation to how to obtain an analysis that is as close as possible to the reality of your possible business?

Business Diagnostics Worksheet

What is analyzed in a business diagnosis

This will depend on business to business, but in general, there are some items that need to be analyzed in any business or reality because they are part of the 5 large areas of management. I am going to separate which are the main areas and sub groups (within those areas) that we analyze in our business diagnostic worksheet:

  • Strategy
    • short-term
    • medium term
    • long term
    • environmental analysis
  • Finances
    • financial control
    • financial planning
    • contribution margin and profitability
    • financial indicators
  • Marketing
    • marketing planning
    • online media
    • offline media
    • customer relations
  • Human Resources
    • recruitment and selection
    • training and development
    • retaining talent
  • Operations
    • processes
    • quality
    • logistics

For each of them, we use a structure of some standardized questions, answers, and feedback that we have created for each of the 4 possible answers, see:

what and how to do business diagnosis - structure of questions

Above we have a question "Does the company have planning and budget control?" From the financial area, sub financial planning group. According to the response that the company does not have a plan, the business diagnostic worksheet already gives feedback and adds that note to the total note of that area.

How to make a diagnosis in practice

Now that we understand the mechanism and functioning of a business diagnosis, I can list the main steps you need to take, regardless of the tool you use:

  • Step 1 - Ask the right questions (according to the reality of your business) - this is one of the advantages of using a ready-made business diagnostic worksheet, you do not have to think about the entire structure of questions and areas. Below I show an example of questions for the HR area, sub recruitment and selection group:

what and how to do business diagnosis - questions

  • Step 2 - Answer the questions in the most honest way possible - the paper and spreadsheet will always accept any response you give. So the more realistic you are, the better it will be for your analysis and for the action plans that will be created from it.
  • Step 3 - Analyze your result - see the most important areas, making a good comparison between your current score, the recommended minimum and the desired score.

how to interpret the results of a business diagnosis - urgency

  • Step 4 - Develop strategies and action plans - to optimize those areas and sub areas that need more attention (urgency) and which are performing worse.

I believe this is the best way to go and, if you need help or you’re out of time, I recommend our business diagnostic worksheet, which already has a structure ready and gives you the results automatically according to the answers given to each of the large areas of management.

Business Diagnostics Worksheet

Excel Spreadsheets


  1. Hi, I'm loving how clear this article is but the only bit is the examples are not in English. Would you be able to email me a link or the same article with the examples in English. My email address - [email protected]

  2. Hello Josselin, The cost of the calculating house is only one. Once you buy it, you can use it with your customers, simply by not giving it to them, selling it for free. If you want one of your customers to keep the calculation now, simply indicate your purchase of the same way I do it.

  3. Good night Rafael,

    I am creating a company dedicated to conducting business diagnostics for companies, which by not having a clear picture in the main areas, is likely to disappear.

    My consultation is your cost and per plant, you decide for today in excel and if you buy one of each, will serve me as a permanent tool to use it with all my customers?

  4. Rafael. Good morning.
    It is very interesting the template that you have developed. I am a student and I would like to talk to you about some subjects for the acquisition of these templates. I could share an email so we can communicate and talk about it.

  5. Good morning, I'm doing a job on the diagnosis of galp company communication.
    Could you help me how?

  6. We have developed a proprietary method based on our consulting experience and business area development rules.

  7. What was the methodology used to develop the Diagnosis and calculate the scores?

  8. Good evening, these works have a demo in Spanish? The one that is downloaded is in Portuguese

    Thank you for your attention.

  9. Good evening! Rafael,

    I am setting up a CBT with the theme: Corporate Budget As an Instrument of Planning and Control for the Future of the Company. I wonder if you have any business budget template template so that I can demonstrate in my work how business budgeting can be used as an instrument to plan and control the future of a business?

    I thank


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