How to find your company's critical success factors
Your business entails a lot of people, money, time, and decision making in order to succeed. Many businesses have adopted programs that help the company to achieve growth and success. Critical success factors take a look at the activities your business undertakes that allow it to succeed. Critical success factors related to quality, money, customer satisfaction, and your overall strategic plan.
Before you can decide on the critical success factors, your company needs to have a strategic plan in place. You need to evaluate how your company compares to others in the market, why customers shop at your company, how your customers feel about your company and products, and what actions you can take in order to achieve success. The strategic plan will help your company gain an understanding of where it is now and where it wants to go in the future.
A good way to develop a strategic plan is to ask your customers questions. Start with asking them about the company, the products, and their level of satisfaction. The answers you obtain can help you determine the critical success factors. The critical success factors should be written in a way that is easy to understand and can be measured and tracked continuously.
Critical success factors are measured with key performance indicators (KPIs). Key performance indicators (KPIs) are financial metrics and non-financial metrics that are used to define and measure the progress of a company toward its goals. The business world has found that a company can either thrive or fail based upon their use of KPIs. A good business is able to identify, define, track and act up their KPIs.
Here are some typical critical success factors:
Those are 4 easy critical success factors to measure. Once you have identified the critical success factors, you will measure them against your expectations. For example, you can set a critical success factor to be "achieve 100% sales for returning customers for this month" and set that against "last months returning customer sales".
If you have been tracking your KPIs for several months and you are not showing improvement, then you need to re-evaluate your KPIs. There are several things you can look at to determine why your KPIs are failing and in turn, why they are not providing accurate critical success measures. Cash flow, employee turnover, product dysfunction, and process breakdown are all things that need to be looked at when creating new KPIs.
Once you have a new process in place, you will find it easier to establish new procedures for your critical success factors. Always look at your KPIs each time there is a change in the industry. A new competitor in the industry can have a large impact on your critical success factors. Other factors can include quality control problems or inventory issues. Be sure to take a good look at everything so you can make a new business plan to establish good critical success factors.
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