Critical Success Factors Benchmarks for Essential Actions to Achieve Purpose of Objectives
Critical Success Factors: You want to succeed, obviously, but as I remember it, the determination of what things are the most critical to that success is far from easy. Among critical success factors, sales is likely near the top of the list. Any old sales? Probably not. When I started selling consulting services and management products in 1982, a big Nigerian plastic shoe manufacturer was an early win (and bad debt).
Mars Confectionery was another early sale. However, unlike the shoe guys, they were a wonderful customer for referrals. They were renowned for their management and their five principles: “Quality, Responsibility, Mutuality, Efficiency and Freedom”. It was a company whose advice was sought by many others. So just ‘sales’ was not among our critical success factors. We worked hard on defining what was the right kind of customer for us.
Process of Defining Critical Success Factors
The process of defining CSFs needs to be worked on by founders/top team. It can be difficult to differentiate between this and the strategy planning process itself. Do not let that worry you, because the one depends upon the other and vice versa. It may even be that each leads you to modify the other. The net result should be that the organization is helped to fulfill its mission.
Critical Success Factors are typically determined for the whole operation through financial, marketing & sales, personnel functions, but can be for any function of the venture that is going to mean make or break—in your judgement. Some CSFs may external factors over which you have no control, like business climate, legislation, or environmental issues. Others may be external and where you have a role, such as the competitive situation within your sector, or new competitors or innovations that may disrupt.
The process will be messy and you should not be afraid to get feedback from others implicated, though not involved. You should make use of other tools, such as the Cause and Effect Diagram, Affinity Diagrams and SWOT, of example. Such activities may help you set a hierarchy of Critical Success Factors. The most critical of the critical success factors are the ones that should preoccupy you!
Once the critical success factors have been determined, then each one has to be examined critically, so that they can be carefully monitored.
Basic Steps for Setting Critical Success Factors