Critical Success Factors: An Objective Way to Measure and Plan for Success
by James H. Canada
Success is relative. After all, it’s a feeling that really depends on your individual goals, aspirations and expectations. If you tell me that you feel successful, whether in business or life, who am I to tell you otherwise?
While a subjective feeling of personal and professional fulfillment is always good for morale, you also need a quantitative way to show shareholders, investors, employees, clients, vendors, and banks that your business is growing. You need “critical success factors.”
Critical success factors are key components of any business that enable you to evaluate growth in an objective way. They are aligned with your mission statement and defined by your business’s aims, tactics and activities.
Determined by the owner or leadership team, these objectives not only measure success, but also give employees direction and purpose in everything they do.
These factors vary from business to business, but typically fall into one of four common themes:
- Market penetration - Surpassing all competition by becoming a recognized leader in your field.
- Customer satisfaction - Attracting and keeping clients by adding value and establishing yourself as a vital business partner.
- Employee satisfaction - Quality service starts with qualified, satisfied employees. That’s why it’s vital to recruit and retain a competent, resilient workforce through professional development.
- Financial success - The bottom line is never really the bottom line: Profits are built on a foundation of services and/or goods that exceed that of competitors in quality, value and effectiveness.
As mentioned above, all company activities and objectives must be directed toward one or more of these four areas. Doing so will avoid “flavor-of-the-month” marketing planning and give employees a sense of purpose. In doing so, these critical success factors not only lay out a well-defined way to measure your progress, but also provide a clear path for your company’s future.
James H. Canada is managing partner/CEO for Alliance Technologies LLC, ITEN mentor and author of “Corporate to Entrepreneur: Strategies for Success.” Contact Jim at james.canada@alliancetechnologiesllc.com, 636-734-2337 or www.alliancetechnologiesllc.com.