A Critical Success Factor (CSF) is a key strategy that a business must achieve to realize it’s purpose and mission.
For a CSF to be effective, it must meet the following conditions:
1) It must be vital to the organization’s success,
2) It must Benefit the company,
3) Thirdly, it should be synonymous with the businesses high-level goals, and
4) Be linked directly to the business strategy.
Remember the ActionCOACH definition of a successful business is – “A commercial, profitable enterprise that WORKS WITHOUT the business owner, you!”
Here is a summary of the 5 critical factors that I believe must be in place in your business to achieve the optimum level of effectiveness.
- Get the Right People on the Bus
We want the dream team! The superstar employees in the organization who are engaged and inspired, help us build the business as if it is their own. Your team is what differentiates you from the other players. They ensure that the customers are treated as the customers want to be treated (platinum rule) to ensure a mutually beneficial life-long relationship.
Business leaders know how to effectively manage their teams, as it requires balancing between providing strict direction, structure and organization, and encouragement, as well as personal growth and development.
Getting the Right People also requires a structured recruitment process, one that ensures hiring people with passion and that are trained for skills where needed. It’s about employing people who believe what we believe in!
It is Richard Branson who said “Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients.”
Happy employees ensure happy customers and in return, happy customers ensure happy shareholders – in that order. Therefore, customers become your raving fans and do the selling of your business brand on your behalf.
How can we help you build your team?
1. Firstly, have a clear and inspiring purpose to achieve success
What is it that you truly believe in and that you want the business to deliver? We need to have a clear reason for Organizing and Working Together and get clarity on the organization’s WHY. Remember, the reason for our existence is not about making the money but serving a purpose and fulfilling a need.
So, it is our purpose to reach out and make a difference in people’s lives and if so how do we do that? As Simon Sinek states in his book Start with the Why: How Great Leaders Inspire Everyone to Take Action.
“People don’t buy what you do; they buy why you do it. And what you do simply proves what you believe.”
Our purpose is to inspire and influence human behavior. It is critical that we understand that people are drawn to leaders and organizations that are good at communicating their purpose and what they truly believe in. The reason for this is that these organizations make us feel:
- that we belong,
- safe and not alone
This is how a great organization inspires its people and attracts brand ambassadors.
2. Secondly, optimized Operational Processes
These processes define the activities that employees undertake to fulfill their organizational purpose. Processes must be clearly defined to create value for your customers. People will pay for value.
Systems are normally put in place to ensure accountability and ownership and we focus on the results, not the reasons.
Successful businesses have a rhythm between systems and processes which are interlinked to ensure maximum output. Effective operations ensure consistency and systemization of your processes is a must to ensure that customers get what they want at the right time, price and quality.
Typical organizational operation measurements include staff morning start-up meetings, weekly operations progress reports, management and monthly financial reviews to name but a few. Clear communication is key and business leaders know this. Communication is the true lifeblood of a successful organization.
3. Great Physical Resources
The three big physical resources are:
- facilities and
Having adequate resources or infrastructure is vital to running a successful business and it starts with a proper workplace that one can be proud of and where business owners and staff can work in an environment that enhances their productivity.
4. Know your business numbers!
Successful companies make money and experienced entrepreneurs know that cash flow is king. Failing to manage cash flow is the No. 1 reason for business failure. Make sure the money is in your bank account when you need it. Budget and monitor your incoming and outgoing cash. Once you are stable, you will be able to invest in other resources like assets or equipment to ensure that the work gets done and quality standards are met.
If you don’t have enough money, you can’t start or sustain a business and one of the biggest expenses is providing adequate facilities and equipment for our people.
5. Lastly, consistent Stream of New Customers – for life!
Customers are the people outside the business organization who are willing to pay money in return for the products and services we provide. We need to have a consistent stream of prospects in our sales pipeline to ensure continued growth and cash flow for firstly survival and secondly business growth.
A notable critical success factor here is that great companies know their numbers and they manage their sales and marketing efforts accordingly.
It isn’t a see-saw process of doing the work or doing sales and marketing activities. Great businesses are in control of their lead generation process and have at least 10 active strategies that work for them.
Testing and measuring these strategies is important to measure sales conversion rates or incoming leads.
Successful businesses know their target market and are constantly marketing to the identified segments to increase their prospects.
Are you experiencing difficulty or do not know how or where to begin implementing the 5 CSFs in your business?
In conclusion, I can help! Connect with me today for a complimentary one-hour business strategy consultation by completing the following online inquiry form or view our upcoming events and register for our next complimentary 6 Steps to the Business of Your Dreams webinar.
Remember, we develop skills not by merely observing others but by doing. Successful business owners are great at taking massive action which will in turn leads to massive results in business profits and growth.
Yours in great business,
1. The 5 Key Success Factors – EW Lawrimore
2. Start with Why – Simon Sinek
3. Own resources and case studies