Critical Success Factors: What Does This Mean for Managers?

To motivate employees to perform effectively, you must set goals for them to work toward. You can do this by creating critical success factors that take time and dedication to meet. Strong CSFs can motivate team members to meet long-term goals that can enhance your company’s performance significantly and make your employees feel pride in accomplishing these goals. 

 

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The basics of critical success factors

Critical success factors are long-term goals leadership and employees set to keep it successful and performing well. Many companies hold approximately three to five critical success factors at once and work together to ensure they are on track with these goals. After leadership and employees decide which critical success factors they would like to focus on, they strategize how they may accomplish these long-term goals. They develop smaller goals that help them reach the larger critical success factor. 

 

CSFs are a very common goal-setting strategy for companies. Many employees set goals and strategies for their businesses that are similar to the goals many other companies set. Because of this, there are common types of success factors your company’s goal falls under. Types of critical success factors include:

 

  • Environmental: These are CSF strategies based on situations happening in the surrounding environment that may influence your business’s performance. This can be the economy, competition with another company and any advancements made in technology. 
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  • Industry: This type of CSF strategy is goals developed based on occurrences within your specific industry. For example, if you run a restaurant, your CSF could be to win the annual prize for the best waitstaff at the end of the year. 
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  • Temporal: These factors are usually shorter than others and often focus primarily on the internal growth of your company. Address any company challenges you’d like to overcome like decreasing employee turnover rate or increasing employee engagement. 
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  • Strategic: This CSF type focuses on how your brand markets itself and how you’d like to stand out to your audience and competitors. If you want to establish yourself as the best mortgage technology software, this could be your strategic CSF. 

Related: How to Reduce Employee Turnover

 

How to create critical success factors 

Follow the steps below to create strategic critical success factors for your company to easily follow and understand. 

 

  1. Brainstorm goals with supervisors and employees
  2. Determine the steps to reach those goals
  3. Set deadlines for each CSF
  4. Announce CSF plans to employees
  5. Regularly track CSF results

1. Brainstorm goals with supervisors and employees

Before determining your company’s critical success factors, you should receive feedback from many other team members and leadership. This helps you gain a better understanding of what goals your employees aim to achieve and what resources they may need to accomplish them. Note possible CSFs and narrow them down yourself and with other leadership members. 

 

Once you’ve found possible CSFs, have other members of the leadership team and stakeholders look these goals over. They can help you understand if these are achievable goals that may significantly improve your company’s performance. 

 

2. Determine the steps to reach those goals

Once you have three to five goals prepared, you can now plan how to achieve each one. Sort them into their respective CSF types and decide which departments can help meet these goals. Create a strategy for each department or employee to finish smaller goals to meet the larger CSF goal. 

 

If you are less familiar with the specific responsibilities of employees within departments, you can work with managers to better determine these steps. Managers can also assign responsibilities to the employees they believe are best suited for each task. 

 

3. Set deadlines for each CSF

Once you have developed your plan to accomplish CSFs, you can set deadlines for each one. Work with managers to determine the most realistic deadline for each goal to keep it from interfering with other important department projects. Try to ensure these deadlines give employees and leadership plenty of time to accomplish them and to provide valuable outcomes for each task.
 

4. Announce CSF plans to employees

After deciding your strategy and deadline, you can hold a company-wide meeting or meet with departments individually to announce your critical success factor plans to employees. This motivates employees to work toward a significant goal and allows you to provide strategy clarifications if they have questions regarding these plans. Be specific and detailed when describing your goals for the company. 

 

Related: How to Motivate Your Employees

 

5. Regularly track CSF results

To ensure employees are following through with their CSF strategies, you should regularly track their progress for completing each goal. You can assign a manager to oversee progress and ensure employees stay on track. If managers notice employees fall behind schedule, they can work with them to provide guidance and assistance to get them back on track with their goals. 

As the manager oversees their department’s progress, they can regularly meet with you to explain the results their employees are providing. They can also explain any challenges for meeting certain goals and request resources to help increase their efficiency or they can request to extend certain deadlines. Communicating with employees during your CSF progress can encourage them to continue performing well and work toward the company’s overall goal.  

 

Critical success factors FAQs

Below is a common FAQ regarding the use of critical success factors in your business. 

 

What are the factors to look for when finding a software to build and track your CSFs? 

When creating your CSFs, you can develop and track these results using a spreadsheet. You can also invest in software programs to assist you in building and tracking your critical success factors. When searching for an effective CSF software program for your business, you should look for one that: 

 

  • Is easy for yourself and your team to view results and progress as well as leave comments and questions 
  • Allows you or managers to easily assign tasks to employees 
  • Creates reports at the end of a quarter or year to display your progress to employees, leadership and stakeholders in a visually appealing way
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