How to Write a Diagnostic Report

The question, “How is the company doing?” is incredibly common in business, and it is also incredibly complex. Even the owner, CEO or other top executives may find it hard to answer at any given point in detail, and there are a number of ways the question can be directed. “How is the company doing compared to last year?” and, “How is the company doing compared to competitors?” are two very different questions and, “How is the company expected to do next year?” a completely different area still.

A number of tools exist to evaluate a company’s performance, but one of the most critical is a diagnostic report, which gathers information about the company’s departments, suppliers, goods and services and much more to provide a concise, data-based report with conclusions that can help future direction.

Diagnosis by Definition

Diagnosis itself is the act of investigating, analyzing and defining the cause or nature of a particular situation, condition or problem, often by identifying symptoms and signs. An easy example comes from the medical field: You feel sick, which is the problem. A runny nose and a fever might be symptoms. A doctor deciding you have the flu is the diagnosis.

These principles apply to business performance as well. Management decides to look at performance, which is the situation. They use and analyze a collection of data, which are the signs. They may then decide the company is underperforming in certain areas, or that there’s a business opportunity to be had: the diagnosis. This then gets delivered to its audience – CEO, director, board or shareholders – in the form of the diagnostic report.

Importance of Diagnostics

The most important part of this entire process is the diagnostics themselves. It’s critical to ensure the data is good, the analysis methods are well understood and meaningful and that the conclusions made are supported by the data rather than assumptions. In order to ensure the report is as good as it can be, be sure of these things before starting to summarize:

Writing an Effective Diagnostic Report

Writing an effective diagnostic report will require professional writing experience, an understanding of the areas of the business being evaluated and an analytical mind that knows how to draw conclusions. It also usually requires some external research into the industry, to compare the company’s performance numbers with competitor benchmarks. This all depends on how the report will be written. Often a team will gather information, analyze and make some basic tentative conclusions; this then comes to the hands of someone in a key position who can construct the report and emphasize any findings.

Steps of a Diagnostic Report

  1. First, identify the audience. A diagnostic report for a small company with a single CEO will look very different than one for a large corporation with a board of directors and external shareholders. Knowing the target for the report will determine how much external research is needed, how much background information will be required to explain business processes and the extent to which internal business terms need to be defined.
  2. Next, define the scope of the report. Define the goals, expectations and what results the outcome could have. Normally, the goal is to measure the business’ current performance to help with strategic planning. This could be taking place on a broad, organization-wide scale, or with a more narrow focus into one aspect of the business; this is why it’s important to define the scope from the beginning. It’s also best to emphasize how the diagnostics will help the business' performance.
  3. Explain the methodologies used to analyze the data. Depending on the audience, this may be a brief overview, or it may need a few paragraphs explaining the assumptions and methods. It may be best to include a few examples within the main body of the report; selected quotes from a customer satisfaction survey, for example, or a summary of operating budget numbers. If the report includes an industry-wide analysis for benchmarks, explain where the comparable information came from.
  4. Next, present the conclusions that have been drawn from the analysis. Be sure these are supported by numbers and facts. Each claim or finding should be supported by a selection of the representative data. Keep the audience and the objectives in mind when identifying these conclusions; the diagnostic report is both about identifying weak areas and highlighting internal strengths that can provide opportunities for improvement.
  5. Ensure the document is professionally written, and that all graphs and charts are self-identifying. It’s a good idea to either attach the raw data in an appendix or – if there’s an unwieldy amount – make sure it’s available to the audience after they’ve read the report.

Reveal Opportunities for Growth

The form of the diagnostic report makes it seem like the place to identify gaps in company performance and highlight areas to improve, but diagnostic reports can also help reveal opportunities for growth. Here are some things to include within the scope that will help manage this as well:

Impact of Diagnostic Reports

Diagnostic reports can cover a lot of ground, but they are also key elements of maintaining business performance and direction. Because they can have a huge impact on objectives, it’s incredibly important to make sure the underlying data is sound and that the conclusions are supported by facts and records. With all of that in place, a diagnostic report can be an incredibly powerful tool to put in the hands of decision-makers.

  1. Lumen: Business Communication
  2. Elite Essay Writers: How to Write a Diagnostic Report
  3. DCL Insight: 10 Reasons Why Business Diagnostics are Important
  4. Fennec: Business Analysis Diagnosis
  5. Hermann Advantage Consulting: Why You Need a Business Diagnosis

Danielle Smyth is a writer and content marketer from upstate New York. She has been writing on business-related topics for nearly 10 years. She owns her own content marketing agency, Wordsmyth Creative Content Marketing, and she works with a number of small businesses to develop B2B content for their websites, social media accounts, and marketing materials. In addition to this content, she has written business-related articles for sites like Sweet Frivolity, Alliance Worldwide Investigative Group, Bloom Co and Spent.

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