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 Assignment 6 (Due: December 30, 2009, before 01:00pm)

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eyesee



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PostSubject: Assignment 6 (Due: December 30, 2009, before 01:00pm)   Wed Dec 09, 2009 1:47 pm

Identify and discuss the steps for "critical success factors" approach? (at least 1,500 words)
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PostSubject: Assignment 6   Thu Dec 10, 2009 7:54 pm

Identify and discuss the steps for "critical success factors" approach?


Most of the organizations today are aiming for success, that is why the term Critical Success Factors are develop in order to help the organizations succeed in their plans. According to wikipedia "Critical Success Factor (CSF) is the term for an element that is necessary for an organization or project to achieve its mission. It is a critical factor or activity required for ensuring the success of your business. The term was initially used in the world of data analysis, and business analysis. For example, a CSF for a successful Information Technology (IT) project is user involvement."

These are the Most Critical Success Factors:

1.Money: positive cash flow, revenue growth, and profit margins.

2.Your future: Acquiring new customers and/or distributors.

3.Customer satisfaction: How happy they are.

4.Quality: How good is your product and service?

5.Product or service development: What's new that will increase business with existing customers and attract new ones?

6.Intellectual capital: Increasing what you know is profitable.

7.Strategic relationships: New sources of business, products and outside revenue.

8.Employee attraction and retention: Your ability to extend your reach.

9.Sustainability: Your personal ability to keep it all going.


What is s Critical Success Factor(CSF)?

Most smaller and more pragmatic businesses can still use CSF’s but we need to take a different, more pragmatic approach.

Critical Success Factors have been used significantly to present or identify a few key factors that organizations should focus on to be successful.

As a definition, critical success factors refer to "the limited number of areas in which satisfactory results will ensure successful competitive performance for the individual, department, or organization”.

As you read this and many other resources on the internet you will discover that there are potentially a confusing variety of definitions and uses of Critical Success Factors.

Before you start the journey looking at CSFs it is important to realise that the specific factors relevant for you will vary from business to business and industry to industry. The key to using CSFs effectively is to ensure that your definition of a factor of your organizations activity which is central to its future will always apply.

Therefore success in determining the CSFs for your organization is to determine what is central to its future and achievement of that future.

This page is primarily written for students of management and business, to keep things simple for application in smaller organizations remember to only have 5-7 critical factors for YOUR organization, and I am sure one of those will be cashflow!

How Critical Success Factors important to your business?

Identifying CSF's is important as it allows firms to focus their efforts on building their capabilities to meet the CSF's, or even allow firms to decide if they have the capability to build the requirements necessary to meet Critical Success Factors (CSF's).

Background

The principle of identifying critical success factors as a basis for determining the information needs of managers was proposed by RH Daniel (1961 Harvard Business Review - HBR) as an interdisciplinary approach with a potential usefulness in the practice of evaluation within library and information units but popularized by F Rockart (1979 Harvard Business Review - HBR). In time many academics have applied the methodology increasingly outside the educational establishment.

The idea is very simple:

in any organization certain factors will be critical to the success of that organization, in the sense that, if objectives associated with the factors are not achieved, the organization will fail - perhaps catastrophically so.

The following as an example of generic CSF's:
New product development,
Good distribution, and
Effective advertising


Factors that remain relevant today for many organizations.

The actual development or history of the approach

With a phrase like Critical Success Factors having 'common usage' within technical environments it is difficult to identify its true history in the context of business, management and human resources. One test for originality is the use of the TLA (Three Letter Acronym) of CSF. And one of the earliest uses of this is by

Chief executives define their own data needs. By: Rockart, John F.. Harvard Business Review, Mar/Apr79, Vol. 57 Issue 2, p81-93, 13p

In this earlier work:

MANAGEMENT INFORMATION CRISIS. By: Daniel, D. Ronald. Harvard Business Review, Sep/Oct61, Vol. 39 Issue 5, p111-121, 11p
Ronald does not use the term CSF or even the phrase Critical Success factors, but does discuss critical elements and non critical elements of a business leading to "controlling competitive success" Daniel also uses the term "success factors" in the context that we would understand today.

Predating these pieces is a short entry:

THE CASE STUDY METHOD AND THE ESTABLISHMENT OF STANDARDS OF EFFICIENCY.By: Lebreton, Preston P.. Academy of Management Proceedings, 1957, p103-103, 1p

In which students looking into the efficiency of businesses for case studies are recommended to look at "the factors which seem to be paramount in determining success in this industry" this is bay far the earliest mention of what we today know as "Critical Success factors"

To our mind the first published work of this approach is by Rockart. This pages reproduced from RapidBI.com

Other sources of research:

Management Control Systems: Text, Cases and Readings By Robert Newton Anthony, John Dearden, Richard F. Vancil Published by R. D. Irwin, 1972 p151

This publication seems to be one of the earliest and widest cited books in the early days of CSFs.

10 problems that worry presidents. By: Spencer, Lyle M.. Harvard Business Review, Nov/Dec55, Vol. 33 Issue 6, p75-83, 9p

In this article Spencer asks the question: "What are the essential factors that produce success in my company?" which for 1955 is getting close to the beginnings of CSFs - so for those interested in the early beginings worth a look.

Types of Critical Success Factors

There are four basic types of CSF's

They are:

1.Industry CSF's resulting from specific industry characteristics;

2.Strategy CSF's resulting from the chosen competitive strategy of the business;

3.Environmental CSF's resulting from economic or technological changes; and

4.Temporal CSF's resulting from internal organizational needs and changes.

5.Things that are measured get done more often than things that are not measured.

Each CSF should be measurable and associated with a target goal. You don't need exact measures to manage. Primary measures that should be listed include critical success levels (such as number of transactions per month) or, in cases where specific measurements are more difficult, general goals should be specified (such as moving up in an industry customer service survey).

Five Key Sources of Critical Success Factors

MAIN ASPECTS OF Critical Success Factors and their use in analysis
CSF's are tailored to a firm's or manager's particular situation as different situations (e.g. industry, division, individual) lead to different critical success factors. Rockart and Bullen presented five key sources of CSF's:
1.The industry,
2.Competitive strategy and industry position,
3.Environmental factors,
4.Temporal factors, and
5.Managerial position (if considered from an individual's point of view). Each of these factors is explained in greater detail below.

The Industry

Industry: There are some CSF's common to all companies operating within the same industry. Different industries will have unique, industry-specific CSF's

An industry's set of characteristics define its own CSF's Different industries will thus have different CSF's, for example research into the CSF's for the Call centre, manufacturing, retail, business services, health care and education sectors showed each to be different after starting with a hypothesis of all sectors having their CSF's as market orientation, learning orientation, entrepreneurial management style and organizational flexibility.
In reality each organization has its own unique goals so while thee may be some industry standard - not all firms in one industry will have identical CSF's.
Some trade associations offer benchmarking across possible common CSF's.

Competitive Strategy and Industry Position

Competitive position or strategy: The nature of position in the marketplace or the adopted strategy to gain market share gives rise to CSF's Differing strategies and positions have different CSF's

Not all firms in an industry will have the same CSF's in a particular industry. A firm's current position in the industry (where it is relative to other competitors in the industry and also the market leader), its strategy, and its resources and capabilities will define its CSF's
The values of an organization, its target market etc will all impact the CSF's that are appropriate for it at a given point in time.

Environmental Factors

Environmental changes: Economic, regulatory, political, and demographic changes create CSF's for an organization.

These relate to environmental factors that are not in the control of the organization but which an organization must consider in developing CSF's Examples for these are the industry regulation, political development and economic performance of a country, and population trends.
An example of environmental factors affecting an organization could be a de-merger.

Temporal Factors

Temporal factors: These relate to short-term situations, often crises. These CSF's may be important, but are usually short-lived.

Temporal factors are temporary or one-off CSF's resulting from a specific event necessitating their inclusion.
Theoretically these would include a firm which "lost executives as a result of a plane crash requiring a critical success factor of rebuilding the executive group".
Practically, with the evolution and integration of markets globally, one could argue that temporal factors are not temporal anymore as they could exist regularly in organizations.
For example, a firm aggressively building its business internationally would have a need for a core group of executives in its new markets. Thus, it would have the CSF of "building the executive group in a specific market" and it could have this every year for different markets.

Managerial Position

Managerial role: An individual role may generate CSF's as performance in a specific manager's area of responsibility may be deemed critical to the success of an organization.

Managerial position. This is important if CSF's are considered from an individual's point of view.
For example, manufacturing managers who would typically have the following CSF's: product quality, inventory control and cash control.
In organizations with departments focused on customer relationships, a CSF for managers in these departments may be customer relationship management.

Critical Success Factors

So many important matters can compete for your attention in business that it's often difficult to see the "wood for the trees". What's more, it can be extremely difficult to get everyone in the team pulling in the same direction and focusing on the true essentials.

That's where Critical Success Factors (CSFs) can help. CSFs are the essential areas of activity that must be performed well if you are to achieve the mission, objectives or goals for your business or project.

By identifying your Critical Success Factors, you can create a common point of reference to help you direct and measure the success of your business or project.

As a common point of reference, CSFs help everyone in the team to know exactly what's most important. And this helps people perform their own work in the right context and so pull together towards the same overall aims.

The idea of CSFs was first presented by D. Ronald Daniel in the 1960s. It was then built on and popularized a decade later by John F. Rockart, of MIT's Sloan School of Management, and has since been used extensively to help businesses implement their strategies and projects.

Inevitably, the CSF concept has evolved, and you may have seen it implemented in different ways. This article provides a simple definition and approach based on Rockart's original ideas.

Rockart defined CSFs as:
"The limited number of areas in which results, if they are satisfactory, will ensure successful competitive performance for the organization. They are the few key areas where things must go right for the business to flourish. If results in these areas are not adequate, the organization's efforts for the period will be less than desired."

He also concluded that CSFs are "areas of activity that should receive constant and careful attention from management."

Critical Success Factors are strongly related to the mission and strategic goals of your business or project. Whereas the mission and goals focus on the aims and what is to be achieved, Critical Success Factors focus on the most important areas and get to the very heart of both what is to be achieved and how you will achieve it.
Using the Tool: An Example

CSFs are best understood by example. Consider a produce store "Farm Fresh Produce", whose mission is:

"To become the number one produce store in Main Street by selling the highest quality, freshest farm produce, from farm to customer in under 24 hours on 75% of our range and with 98% customer satisfaction."

(For more on this example, and how to develop your mission statement, see our article on Vision Statements and Mission Statements.)

The strategic objectives of Farm Fresh are to:
Gain market share locally of 25%.
Achieve fresh supplies of "farm to customer" in 24 hours for 75% of products.
Sustain a customer satisfaction rate of 98%.
Expand product range to attract more customers.
Have sufficient store space to accommodate the range of products that customers want.

In order to identify possible CSFs, we must examine the mission and objectives and see which areas of the business need attention so that they can be achieved. We can start by brainstorming what the Critical Success Factors might be (these are the "Candidate" CSFs.)

...Critical Success Factors is very important to an organizations because this stands the key for the success of a certain organization. these factors is where the good fortunes of organizations relies.

References:

http://rapidbi.com/created/criticalsuccessfactors.html#WhatareCSFs
http://en.wikipedia.org/wiki/Critical_success_factor
http://www.mindtools.com/pages/article/newLDR_80.htm


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PostSubject: Re: Assignment 6 (Due: December 30, 2009, before 01:00pm)   Fri Dec 11, 2009 4:30 pm

Things that really matters for success : CRITICAL SUCCESS FACTORS

It’s often difficult to see the “wood for the trees” in business because many important matters compete for your attention. Likely to said, it can be extremely difficult to get everyone in the team pulling in the same direction and focusing on the true essentials. That's where Critical Success Factors can help. These are the essential areas of activity that must be performed well if you are to achieve the mission, objectives or goals for your business or project. By identifying your Critical Success Factors, you can create a common point of reference to help you direct and measure the success of your business or project. As a common point of reference, it will help everyone in the team to know exactly what's most important. And this helps people perform their own work in the right context and so pull together towards the same overall aims.

As we try to browse the internet and many other resources, we can find and will discover that there are potential but confusing variety of definitions and uses of Critical Success Factors.

Definitions

Critical Success Factor

An element of organizational activity which is central to its future success. Critical success factors may change over time, and may include items such as product quality, employee attitudes, manufacturing flexibility, and brand awareness. This can enable analysis.

Critical Success Factor

Any of the aspects of a business that are identified as vital for successful targets to be reached and maintained. Critical success factors are normally identified in such areas as production processes, employee and organization skills, functions, techniques, and technologies. The identification and strengthening of such factors may be similar.

Critical Success Factor

Is a business term for an element which is necessary for an organization or project to achieve its mission. For example, a CSF for a successful Information Technology (IT) project is user involvement.

In the Re.ViCa project a critical success factor is defined as follow:


A critical success factor is a factor whose presence is necessary for an organization to fulfill its mission - in other words, if it is not present then its absence will cause organizational and/or mission failure.

Those are just some of various definitions that we could find when we will try to look for the critical success factors.

History/Background

The idea of identifying critical success factors as a basis for determining the information needs of managers was proposed by Daniel (1961) but popularized by Rockart (1979). The idea is very simple: in any organization certain factors will be critical to the success of that organization, in the sense that, if objectives associated with the factors are not achieved, the organization will fail - perhaps catastrophically so. Rockart (1979: 85), by referring to Daniel (1961), gives the following as an example of the CSFs: new product development, good distribution, and effective advertising for the food processing industry - factors that remain relevant today for many firms.

As we start to discuss the Critical Success Factors, it is important to realize that the specific factors relevant for you will vary from business to business and industry to industry. The key to using Critical Success Factors effectively is to ensure that your definition of a factor of your organizations activity which is central to its future will always apply.

Therefore success in determining the Critical Success Factors for your organization is to determine what is central to its future and achievement of that future.

What is a Critical Success Factor?

Critical Success Factors are the critical factors or activities required for ensuring the success your business. The term was initially used in the world of data analysis, and business analysis.

Critical Success Factors have been used significantly to present or identify a few key factors that organizations should focus on to be successful.

As a definition, critical success factors refer to "the limited number of areas in which satisfactory results will ensure successful competitive performance for the individual, department, or organization”.

Inevitably, the CSF concept has evolved, and you may have seen it implemented in different ways.
Critical Success Factors are strongly related to the mission and strategic goals of your business or project. Whereas the mission and goals focus on the aims and what is to be achieved, Critical Success Factors focus on the most important areas and get to the very heart of both what is to be achieved and how you will achieve it.

The term “Critical Success Factor” is used differently, due to ambiguity of the word “critical”. But whichever definition we may use, just be sure it is understood by all the managers.

Types of Critical Success Factor

Four Basic Types:

1. Industry - resulting from specific industry characteristics;
2. Strategy - resulting from the chosen competitive strategy of the business;
3. Environmental - resulting from economic or technological changes; and
4. Temporal - resulting from internal organizational needs and changes.

It is said that things that are measured get done more often than things that are not measured. Each CSF should be measurable and associated with a target goal. It’s not necessarily that you need exact measures to manage. Primary measures that should be listed include critical success levels or, in cases where specific measurements are more difficult, general goals should be specified.

Identifying Critical Success Factors is important as it allows firms to focus their efforts on building their capabilities to meet the CSF's, or even allow firms to decide if they have the capability to build the requirements necessary to meet Critical Success Factors.

Using the Tool: Summary Steps


In reality, it is said that identifying a CSFs is a very iterative process. The mission, strategic goals and CSFs are intrinsically linked and each will be refined as it is developed.

Below are the Summary Steps that used iteratively that will help us identify the CSFs for the business or project:

Step One: Establish your business's or project's mission and strategic goals.

This is the mission statements and the vision statements. Vision Statements and Mission Statements are the inspiring words chosen by successful leaders to clearly and concisely convey the direction of the organization. By crafting a clear mission statement and vision statement, you can powerfully communicate your intentions and motivate your team or organization to realize an attractive and inspiring common vision of the future.

Step Two: For each strategic goal, ask yourself "what area of business or project activity is essential to achieve this goal?" The answers to the question are your candidate CSFs.

Tip: How Many CSFs?

To make sure you consider all types of possible CSFs, you can use Rockart's CSF types as a checklist.

1. Industry - these factors result from specific industry characteristics. These are the things that the organization must do to remain competitive.
2.Environmental - these factors result from macro-environmental influences on an organization. Things like the business climate, the economy, competitors, and technological advancements are included in this category.
3. Strategic - these factors result from the specific competitive strategy chosen by the organization. The way in which the company chooses to position themselves, market themselves, whether they are high volume low cost or low volume high cost producers, etc.
4. Temporal - these factors result from the organization's internal forces. Specific barriers, challenges, directions, and influences will determine these CSFs.

Step Three: Evaluate the list of candidate CSFs to find the absolute essential elements for achieving success - these are your Criticial Success Factors.

As you identify and evaluate candidate CSFs, you may uncover some new strategic objectives or more detailed objectives. So you may need to define your mission, objectives and CSFs iteratively.

Step Four: Identify how you will monitor and measure each of the CSFs.

Step Five: Communicate your CSFs along with the other important elements of your business or project's strategy.

Step Six: Keep monitoring and reevaluating your CSFs to ensure you keep moving towards your aims. Indeed, whilst CSFs are sometimes less tangible than measurable goals, it is useful to identify as specifically as possible how you can measure or monitor each one.

Examples of Critical Success factors

Statistical research into CSF’s on organizations has shown there to be seven key areas. These CSF's are:

1. Training and education
2. Quality data and reporting
3. Management commitment, customer satisfaction
4. Staff Orientation
5. Role of the quality department
6. Communication to improve quality, and
7. Continuous improvement

These were identified when Total Quality was at its peak, so as you can see have a bias towards quality matters. You may or may not feel that these are right or indeed critical for your organization.

The Critical Success Factors we have identified and use in the BIR process are captured in the mnemonic PRIMO-F

1. People - availability, skills and attitude
2. Resources - People, equipment, etc
3. Innovation - ideas and development
4. Marketing - supplier relation, customer satisfaction, etc
5. Operations - continuous improvement, quality,
6. Finance- cash flow, available investment etc

Key Points

Critical Success Factors are the areas of your business or project that are absolutely essential to its success. By identifying and communicating these CSFs, you can help ensure your business or a project is well-focused and avoids wasting effort and resources on less important areas. By making CSFs explicit, and communicating them with everyone involved, you can help keep the business and project on track towards common aims and goals

References/ Sources:

http://www.mindtools.com/pages/article/newLDR_80.htm
http://rapidbi.com/created/criticalsuccessfactors.html#WhatareCSFs
http://informationr.net/ir/6-3/paper108.html
http://www.mindtools.com/pages/article/newLDR_90.htm

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PostSubject: Re: Assignment 6 (Due: December 30, 2009, before 01:00pm)   Sun Dec 13, 2009 1:09 am

Identify and discuss the steps for "critical success factors" approach?

What is a Critical Success Factor?

Critical Success Factors (CSF’s) are the critical factors or activities required for ensuring the success your business. The term was initially used in the world of data analysis, and business analysis.
Most smaller and more pragmatic businesses can still use CSF’s but we need to take a different, more pragmatic approach.
Critical Success Factors have been used significantly to present or identify a few key factors that organizations should focus on to be successful.
As a definition, critical success factors refer to "the limited number of areas in which satisfactory results will ensure successful competitive performance for the individual, department, or organization”
Critical Success Factors are the areas of your business or project that are absolutely essential to its success. By identifying and communicating these CSFs, you can help ensure your business or project is well-focused and avoid wasting effort and resources on less important areas. By making CSFs explicit, and communicating them with everyone involved, you can help keep the business and project on track towards common aims and goals.

A slight distinction must be made when considering CSFs as a strategic driver at the organ-izational or enterprise level (as is done in this report). In this context, CSFs are more than just guiding principles; instead, they are considered to be an important component of a strate-gic plan that must be achieved in addition to the organization’s goals and objectives. While this distinction is subtle, it is intended to point out that an organization’s CSFs are not just to be “kept in mind”; their successful execution must drive the organization toward accomplish-ing its mission.
Many definitions of a CSF at the strategic planning level have already been provided in this report. In his seminal work on CSFs, Rockhart provides a useful summary of similar but dis-tinct definitions [
• key areas of activity in which favorable results are absolutely necessary to reach goals
9 This section relies heavily on the description of CSFs as documented in the original primer by John Rockhart and Christine Bullen [Rockhart 81]. Their work is still widely recognized as the initial definition of CSFs and the CSF approach. CMU/SEI-2004-TR-010 11
• key areas where things must go right for the business to flourish
• “factors” that are “critical” to the “success” of the organization
• key areas of activities that should receive constant and careful attention from manage-ment
• a relatively small number of truly important matters on which a manager should focus attention

4 Types of Critical Success Factor

1. Industry CSF's resulting from specific industry characteristics;
2. Strategy CSF's resulting from the chosen competitive strategy of the business;
3. Environmental CSF's resulting from economic or technological changes; and
4. Temporal CSF's resulting from internal organizational needs and changes.

Industry CSFs:
Every organization inherits a particular set of operating conditions and challenges that are inherent to the industry (or segment of the industry) in which it chose to do business. This results in a unique set of CSFs that organizations in a particular industry must achieve to maintain or increase their competitive positions, achieve their goals, and accomplish their missions. For example, consider an organization in the airline industry. As a member of this industry, the organization inherits CSFs such as “deliver on-time service” or “move away from the hub-and-spoke system.” Failure to achieve these CSFs may render the organization unable to stay competitive in its industry and may ultimately result in its exit.

Strategic CSFs:
these factors result from the specific competitive strategy chosen by the organization. The way in which the company chooses to position themselves, market themselves, whether they are high volume low cost or low volume high cost producers, etc.

Environmental CSFs:
To be successful, an organization must be mindful of the macro environment in which it op-erates. A closed organization—one that does not fully interact with its external environ-ment—cannot survive in the long term. As a result, an organization must acknowledge the18 CMU/SEI-2004-TR-010environmental factors that can affect its ability to accomplish its mission. Environmental CSFs reflect the environmental factors over which the organization has very little control or ability to actively manage. By making these factors explicit, the organization can at least be mindful of them and actively monitor their performance relative to them.Environmental CSFs describe such conditions as current socio-political issues, the industry’s regulatory environment, and factors such as seasonality. For example, the airline industry has been dramatically affected by terrorist activities, which have forced changes in airport opera-tions and scheduling and have brought about new regulations with which airlines must com-ply. Unfortunately, airlines have very little control over this problem

Temporal CSFs
CSFs are tied to the long-term planning horizon of an organization. Over the strategic plan-ning period the organization’s CSFs may remain fairly constant, adjusted only when the or-ganization makes major changes, such as changing its mission or the industry in which it competes. However, at one time or another, every organization encounters temporary condi-tions or situations that must be managed for a specific period of time, while continuing to maintain its performance in all other areas. These temporary conditions or situations can re-sult in temporal CSFs—areas in which the organization must temporarily perform satisfacto-
CMU/SEI-2004-TR-010 19
rily in order to ensure that its ability to accomplish its mission is not impeded.

Things that are measured get done more often than things that are not measured.
Each CSF should be measurable and associated with a target goal. You don't need exact measures to manage. Primary measures that should be listed include critical success levels (such as number of transactions per month) or, in cases where specific measurements are more difficult, general goals should be specified (such as moving up in an industry customer service survey.


Sample Success Factors

• Understanding of Market
• Marketing Variables
• Decision making

A Critical Success Factor Method

Start with a vision:
• Mission statement
• Develop 5-6 high level goals
• Develop hierarchy of goals and their success factors
• Lists of requirements, problems, and assumptions
• Leads to concrete requirements at the lowest level of decomposition (a single, implementable idea) Along the way, identify the problems being solved and the assumptions being made Cross-reference usage scenarios and problems with requirements
• Analysis matrices
• Problems vs. Requirements matrix
• Usage scenarios vs. Requirements matrix
• Solid usage scenarios
• Relationship to Usage Scenarios
• Usage scenarios or "use cases"; provide a means of determining:
o Are the requirements aligned and self-consistent?
o Are the needs of the user being met as well as those of the enterprise?
o Are the requirements complete
• Results of the Analysis

In an attempt to write good CSF's, a number of principles could help to guide writers. These principles are:

• Ensure a good understanding of the environment, the industry and the company – It has been shown that CSF's have five primary sources, and it is important to have a good understanding of the environment, the industry and the company in order to be able to write them well. These factors are customized for companies and individuals and the customization results from the uniqueness of the organization.

• Build knowledge of competitors in the industry – While this principle can be encompassed in the previous one, it is worth highlighting separately as it is critical to have a good understanding of competitors as well in identifying an organization's CSF's Knowing where competitors are positioned, what their resources and capabilities are, and what strategies they will pursue can have an impact on an organization's strategy and also resulting CSF's

• Develop CSF's which result in observable differences – A key impetus for the development of CSF's was the notion that factors which get measured are more likely to be achieved versus factors which are not measured. Thus, it is important to write CSF's which are observable or possibly measurable in certain respects such that it would be easier to focus on these factors. These don't have to be factors that are measured quantitatively as this would mimic key performance indicators; however, writing CSF's in observable terms would be helpful.

• Develop CSF's that have a large impact on an organization's performance – By definition, CSF's are the "most critical" factors for organizations or individuals. However, due care should be exercised in identifying them due to the largely qualitative approach to identification, leaving many possible options for the factors and potentially results in discussions and debate. In order to truly have the impact as envisioned when CSF's were developed, it is important to thus identify the actual CSF's, i.e. the ones which would have the largest impact on an organization's (or individual's) performance.

Here are the ideas that, used iteratively, will help you identify the CSFs for your business or project:

Establish
your business's or project's mission and strategic goals (click here for help doing this.)

Think
of business or project activity is essential to achieve this goal?"

Evaluate
the list of candidate CSFs to find the absolute essential elements for achieving success - these are your Criticial Success Factors.As you identify and evaluate candidate CSFs, you may uncover some new strategic objectives or more detailed objectives. So you may need to define your mission, objectives and CSFs iteratively.

Identify
how you will monitor and measure each of the CSFs.

Communicate
your CSFs along with the other important elements of your business or project's strategy.

Keep monitoring and reevaluating your CSFs to ensure you keep moving towards your aims. Indeed, whilst CSFs are sometimes less tangible than measurable goals, it is useful to identify as specifically as possible how you can measure or monitor each one.


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References:
http://rapidbi.com/created/criticalsuccessfactors.htm[flash][/flash]l
http://www.sei.cmu.edu/reports/04tr010.pdf
http://www.mindtools.com/pages/article/newLDR_80.htm
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♥ilyn_mapalo♥



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PostSubject: Re: Assignment 6 (Due: December 30, 2009, before 01:00pm)   Mon Dec 14, 2009 11:13 pm

Identify and discuss the steps for "critical success factors" approach? (at least 1,500 words)

Exclamation Before identifying the steps for the critical success factors approach, let us take first an overview about this so that we are able to know what is that all about.

Critical Success Factors
Idea The idea of identifying critical success factors as a basis for determining the information needs of managers was proposed by Daniel (1961) but popularized by Rockart (1979). The idea is very simple: in any organization certain factors will be critical to the success of that organization, in the sense that, if objectives associated with the factors are not achieved, the organization will fail - perhaps catastrophically so. Rockart (1979: 85), by referring to Daniel (1961), gives the following as an example of the CSFs: new product development, good distribution, and effective advertising for the food processing industry - factors that remain relevant today for many firms. The CSFs approach was combined with the value chain concept by Porter (1985) in order to form an information audit. Competitive advantage, following Porter (1985), was taken to mean, the ability of a firm to provide better value for its customers through lower prices, higher quality, or benefits not available elsewhere. The primary purpose was to test the idea that the information intensive areas of an organization could be identified within the value chain by using the CSF technique to indicate the critical areas and, thereby, enable the identification of corporate information needs. Corporate information needs were defined as those needs for information that must be satisfied if the organization is to achieve its strategic aims. The proposition was that those parts of the value chain that were perceived by organizational members to be of critical significance would be the areas in which effort ought to be concentrated so that the information systems could be effective.

Ref:http://informationr.net/ir/6-3/paper108.html

Idea For most businesses, executives and employees spend a fair amount of time doing things which don't really make the business more successful. When you stop to consider it, there are only generally a limited number of areas - like sales or product development - which make your business succeed. With insight and analysis you can select these things, the critical success factors. Guaranteed: your business will succeed or fail depending on how you approach your unique set of critical success factors. Understanding these factors and paying 100% attention to them is a sure way to add power to your efforts and jump start towards a new level of performance. Here's how.

Idea Step 1: Identify your critical success factors
The first step is to identify your special set of critical success factors. You may have thought this through in the past; you may think you know them intuitively. When asked "What matters?", many executives reflexively say things like sales, customers, people, or product development. These are all good answers, and they may be correct answers, but you will want to think deeper and broader. Below is a list to start you thinking. It is set in no particular order and contains only the most obvious factors. Review the list and circle areas you believe are critical to your enterprise. You may have to add other, more specific or subtle factors to the list to describe the critical influences on your business' success.
-Distribution - this could be direct sales, telesales, third- party sales, etc.
-Lead generation
-Customer satisfaction
-Referrals
-Research
-Product development
-Production, including quality, costing, run-rates, etc.
-Sufficient investment capital, sufficient working capital
-Customer support / technical support
-Quality assurance
-Sales process / sales life cycle
-Market research
-Customer education
-Sales compensation
-Recruiting
-Personnel retention programs
-Expense management
-Intellectual capital development
-Training
-Marketing communications
-Logistics
-Employee equity
-Executive leadership
-Training and development
-Corporate goals / strategic objectives
-Values and beliefs
-Mission/purpose
-Individual accountability
-Productivity & effectiveness metrics
-Internal communications
-Strategic and tactical planning
-Executive team
-Board of directors/advisors
Be specific when you identify your factors. Don't say "people" when the issue is recruiting, employee satisfaction, training or compensation. Don't say "marketing" or "sales" when the issue is lead generation. Test your assumptions by imagining a decline in a particular factor. How would that impact your business? Now imagine an improvement in that factor. How would that impact your business? In selecting factors, limit your list to no more than seven. Why seven? Cognitive theory suggests that human minds are efficient at juggling from five to nine separate trains of thought - the average and oft- quoted number is seven. Our plan is for you to keep your eye on the ball, you want to limit the balls to those you can keep your eye on.
Idea Step 2: Establishing the measurements
Your next step is to establish a measurement scale for each critical factor. Some of these measures will be quantitative; some qualitative. Sales is an easy one: dollars of revenue measured against budget. Leads generated is also easy - how many? You can further break down sales by product and leads by sources, or you can stick to the consolidated numbers. Choose the measure which best reflects your understanding of how the issue affects your business.
Everything is measurable, you just need the right system. How can you measure your effectiveness in sales compensation? You could establish a compound metric which includes total compensation as a percentage of sales revenue, juxtaposed against goal attainment. Marketing communications is also difficult. One way to measure this is to subjectively assess the quality of your marcom pieces; you could also measure whether you have the total complement of marcom pieces you require. Or, measure whether prospects respond to your marcom efforts. Most likely you will combine all three to get one measure.
A final example is measuring your efforts in the area of your Board of Directors / Board of Advisors. Measures include: do you have one? Are all the board seats filled? Is the board effective for your intended purpose? Measuring the Board factor would likely blend each of these.
Idea Step 3: Setting the baseline
Once you've established a measurement structure for a factor, the next step is setting a baseline. Each factor should be set against a normalizing scale ranging from 1 to 10. Subjectively this can translate into non-performing(1), poor (2-3) , mediocre (4-5), good (6-7), great (8-9), and outstanding (10).
If your sales run-rate is $10 million, determine whether that is a 1, a 5, or a 10. Your answer depends of course on whether you consider performance against budget, performance against stretch goals, or performance against "home-run-out-of-the-park" goals. If your baseline for Board of Directors is two unfilled board seats - is that a 5 (mediocre) or a poor (2-3)? Only you can decide. Although this ultimately is a subjective process, you want to make it as objective as possible.
Idea Step 4: Set new goals
Next, create a "gap" between where you are - your baseline - and your target for that factor. You already have a sales plan, so your gap exists between your current revenue and your budgeted revenue. You may consider your baseline a 5, and your target an 8. Implicit in this 1- 10 scale are judgements about your intentions: will reaching your budgeted revenue put you at 8 (almost great) or 10 (outstanding)? Where do you want to peg your efforts? If you've assessed your employee training at a 4 (mediocre), are you shooting for a 7 (good) or a 9 (great)? You can see from this how your measurement structure and goal system will impact how you allocate your company's resources and energy.
Idea Step 5: Closing the gap
You now have a baseline and a target for each factor. Between them they define a factor gap - your challenge is to close it. Each gap becomes the focus of a meditation which asks the question: What will close the gap between our current level of this factor and our desired level? What possible actions will raise that measurement? You may have intuitive responses to these questions, and when appropriate, trust your gut. If need be, back that gut response with research - but only when cost effective. (Sometimes the most cost effective research is implementation, particularly in simple matters.) Use any idea generation process you are comfortable with. Develop several possible initiatives to raise the level of that factor. With luck your ideas will work together and harmonize in terms of impact or implementation requirements. If you create competing ideas, select the best alternatives. Choose based on return on investment, required resources, scheduling conflicts, time to impact, total cost, and likelihood of success versus risk of failure. Depending on the specific factor, and the size of the gap, you may plan to close it in stages or shoot the gap all at once. You can launch one initiative at a time, or implement several initiatives in parallel. You may find my GamePlan!" methods useful in designing your gap-closing programs. Once you launch your gap-closing initiatives, continually measure your results. Report your progress to participants and stakeholders, and post it publicly.
Idea Step 6: The Ben Franklin Rotation Program
As a young adult, Ben Franklin identified thirteen virtues he aspired to. In order to implement these virtues in his life he devised a "Plan for Self Examination", a program whereby he focused his attention, one virtue at a time, for one week at a time, rotating through the entire list four times a year. He kept a detailed log of the actions he took to develop the virtues in himself, along with his personal results. Paul Lemberg adapted Franklin's concept and called it the Ben Franklin Rotation Program. At any point in time, you will have in place a program for improving every one of your critical factors. But in any given week, your primary attention will be on only one factor. Using Franklin's principles, at the beginning of each week, focus your mind - or collective mind of your management team - on improving that week's factor. What new actions can you take, what new attitudes can you adopt, what new or renewed approaches are available - which will enhance your performance in that one specific area? Do that "thing" wholeheartedly for the entire week. Franklin also shows us how to track your progress in this venture. Create a score sheet detailing your Critical Success Factors. This sheet should detail each factor, its measurements, your current 1-10 rating and your target rating, along with your next action steps for improving that rating. Each factor also gets a weight, which enables you to develop an overall score. Each week, re-rate all the factors on the score sheet, and graph your progress. You may also graph the overall score. Publish the score sheet and the graphs. You can establish a reward system based on individual progress, or, using the factor weights, you can develop a bonus structure which incentivizes total progress. This simple system will focus your attention on improving each one of your critical success factors. With carefully selected factors, you insure both rapid performance increases and balance in your company.

Ref:http://www.paullemberg.com/criticalfactors.html

Idea Successful people have the following:
*Good, well thought out plans.
*The passion for their ambitions.
*Willingness to extend time and effort.
*A willingness to sacrifice in order to achieve.
*The right attitude or the willingness to get the right attitude.

Idea These Critical Success Factors are the most important keys that help to make up the arsenal of your average (or less than average) high achiever.
Some people are lucky that they inherently possess these traits, but even if you don't you can obtain and possess them for yourself. In conclusion,the solution to succeeding lies in many variables, but there are some that are ever present that account for the majority of accomplishments. By seeking to develop your own key factors you can proceed to emulate the feats of the successful or better yet overtake them altogether. These examples of critical success factors should highlight to you the very things that are needed to succeed and make valuable achievements, but they should also make you value the effort that must be exerted in order to accomplish your goals.


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Ariel Serenado



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PostSubject: Re: Assignment 6 (Due: December 30, 2009, before 01:00pm)   Tue Dec 15, 2009 10:48 pm

Identify and discuss the steps for "critical success factors" approach?

In any field of endeavor, there are only two options you can associate to it – a success or a failure, so as to business. In a business it is guaranteed to succeed or to fail depending on how you cope up and handle those factors called, CRITICAL SUCCESS FACTORS. Paying attention to these specific factors will surely add up edge to one’s self to start towards a new and high level of performance. Also, it is therefore a must to appreciate the value of foundation in proper planning and preparing some design efforts prior making a start to deal with improvement program. Furthermore, it should be considered that the one of the most vital factors in any business transformation is to identify the above mentioned factors.

For some sources, critical success factor is defined as the following:

• “Critical Success Factor (CSF) is the term for an element that is necessary for an organization or project to achieve its mission. It is a critical factor or activity required for ensuring the success of your business. The term was initially used in the world of data analysis, and business analysis. For example, a CSF for a successful Information Technology (IT) project is user involvement.”

• Critical success factors refer to "the limited number of areas in which satisfactory results will ensure successful competitive performance for the individual, department, or organization”.

Critical Success Factors have been used significantly to present or identify a few key factors that organizations should focus on to be successful. The principle of identifying critical success factors as a basis for determining the information needs of managers as proposed by RH Daniel (1961 Harvard Business Review - HBR) has the following ideas:

In any organization certain factors will be critical to the success of that organization, in the sense that, if objectives associated with the factors are not achieved, the organization will fail - perhaps catastrophically so.
The following as an example of generic CSF's:
• New product development,
• Good distribution, and
• Effective advertising
Factors that remains relevant today for many organizations.

Another examples of Critical Success factors

Statistical research into CSF’s on organizations has shown there to be seven key areas. These CSF's are:

  • Training and education


  • Quality data and reporting


  • Management commitment, customer satisfaction


  • Staff Orientation


  • Role of the quality department


  • Communication to improve quality, and


  • Continuous improvement
These were identified when Total Quality was at its peak, so as you can see have a bias towards quality matters. You may or may not feel that these are right or indeed critical for your organization.

There are basic types of CSF, these are:
1. Industry CSF's resulting from specific industry characteristics;
2. Strategy CSF's resulting from the chosen competitive strategy of the business;
3. Environmental CSF's resulting from economic or technological changes; and
4. Temporal CSF's resulting from internal organizational needs and changes.

Each CSF should be measurable and associated with a target goal. You don't need exact measures to manage. Primary measures that should be listed include critical success levels (such as number of transactions per month) or, in cases where specific measurements are more difficult, general goals should be specified (such as moving up in an industry customer service survey). Form the identified types of CSF, there are also identified sources these mentioned factors:

Industry: There are some CSF's common to all companies operating within the same industry. Different industries will have unique, industry-specific CSF's. An industry's set of characteristics define its own CSF's Different industries will thus have different CSF's, for example research into the CSF's for the Call centre, manufacturing, retail, business services, health care and education sectors showed each to be different after starting with a hypothesis of all sectors having their CSF's as market orientation, learning orientation, entrepreneurial management style and organizational flexibility. In reality each organization has its own unique goals so while thee may be some industry standard - not all firms in one industry will have identical CSF's. Some trade associations offer benchmarking across possible common CSF's.

Competitive position or strategy: The nature of position in the marketplace or the adopted strategy to gain market share gives rise to CSF's Differing strategies and positions have different CSF's. Not all firms in an industry will have the same CSF's in a particular industry. A firm's current position in the industry (where it is relative to other competitors in the industry and also the market leader), its strategy, and its resources and capabilities will define its CSF's. The values of an organization, its target market etc will all impact the CSF's that are appropriate for it at a given point in time.

Environmental changes: Economic, regulatory, political, and demographic changes create CSF's for an organization. These relate to environmental factors that are not in the control of the organization but which an organization must consider in developing CSF's Examples for these are the industry regulation, political development and economic performance of a country, and population trends. An example of environmental factors affecting an organization could be a de-merger.

Demerger is the converse of a merger or acquisition. It describes a form of restructure in which shareholders or unitholders in the parent company gain direct ownership in a subsidiary (the ‘demerged entity’). Underlying ownership of the companies and/or trusts that formed part of the group does not change. The company or trust that ceases to own the entity is known as the ‘demerging entity’. If the parent company holds a majority stake in the demerged entity , the resulting company is referred to as the subsidiary. Demergers can also result from government intervention, usually by way of anti-trust/competition law, or through decartelization.

Temporal factors: These relate to short-term situations, often crises. These CSF's may be important, but are usually short-lived. Temporal factors are temporary or one-off CSF's resulting from a specific event necessitating their inclusion. Theoretically these would include a firm which "lost executives as a result of a plane crash requiring a critical success factor of rebuilding the executive group". Practically, with the evolution and integration of markets globally, one could argue that temporal factors are not temporal anymore as they could exist regularly in organizations. For example, a firm aggressively building its business internationally would have a need for a core group of executives in its new markets. Thus, it would have the CSF of "building the executive group in a specific market" and it could have this every year for different markets.

Managerial role: An individual role may generate CSF's as performance in a specific manager's area of responsibility may be deemed critical to the success of an organization. Managerial position. This is important if CSF's are considered from an individual's point of view. For example, manufacturing managers who would typically have the following CSF's: product quality, inventory control and cash control. In organizations with departments focused on customer relationships, a CSF for managers in these departments may be customer relationship management.

In an article written by Paul Lemberg, here’s how an individual can attain a new level of performance by identifying critical factors and dealing with the approach:

Step 1: Identify your critical success factors

The first step is to identify your special set of critical success factors. You may have thought this through in the past; you may think you know them intuitively. When asked "What matters?", many executives reflexively say things like sales, customers, people, or product development. These are all good answers, and they may be correct answers, but you will want to think deeper and broader. Below is a list to start you thinking. It is set in no particular order and contains only the most obvious factors. Review the list and circle areas you believe are critical to your enterprise. You may have to add other, more specific or subtle factors to the list to describe the critical influences on your business' success.

Distribution - this could be direct sales, telesales, third- party sales, etc.
Lead generation
Customer satisfaction
Referrals
Research
Product development
Production, including quality, costing, run-rates, etc.
Sufficient investment capital, sufficient working capital
Customer support / technical support
Quality assurance
Sales process / sales life cycle
Market research
Customer education
Sales compensation
Recruiting
Personnel retention programs
Expense management
Intellectual capital development
Training
Marketing communications
Logistics
Employee equity
Executive leadership
Training and development
Corporate goals / strategic objectives
Values and beliefs
Mission/purpose
Individual accountability
Productivity & effectiveness metrics
Internal communications
Strategic and tactical planning
Executive team
Board of directors/advisors

Be specific when you identify your factors. Don't say "people" when the issue is recruiting, employee satisfaction, training or compensation. Don't say "marketing" or "sales" when the issue is lead generation. Test your assumptions by imagining a decline in a particular factor. How would that impact your business? Now imagine an improvement in that factor. How would that impact your business? In selecting factors, limit your list to no more than seven. Why seven? Cognitive theory suggests that human minds are efficient at juggling from five to nine separate trains of thought - the average and oft- quoted number is seven. Our plan is for you to keep your eye on the ball, you want to limit the balls to those you can keep your eye on.

Step 2: Establishing the measurements

Your next step is to establish a measurement scale for each critical factor. Some of these measures will be quantitative; some qualitative. Sales are an easy one: dollars of revenue measured against budget. Leads generated is also easy - how many? You can further break down sales by product and leads by sources, or you can stick to the consolidated numbers. Choose the measure which best reflects your understanding of how the issue affects your business.

Everything is measurable; you just need the right system. How can you measure your effectiveness in sales compensation? You could establish a compound metric which includes total compensation as a percentage of sales revenue, juxtaposed against goal attainment. Marketing communications is also difficult. One way to measure this is to subjectively assess the quality of your marcom pieces; you could also measure whether you have the total complement of marcom pieces you require. Or, measure whether prospects respond to your marcom efforts. Most likely you will combine all three to get one measure.

A final example is measuring your efforts in the area of your Board of Directors / Board of Advisors. Measures include: do you have one? Are all the board seats filled? Is the board effective for your intended purpose? Measuring the Board factor would likely blend each of these.

Step 3: Setting the baseline

Once you've established a measurement structure for a factor, the next step is setting a baseline.
Each factor should be set against a normalizing scale ranging from 1 to 10. Subjectively this can translate into non-performing(1), poor (2-3) , mediocre (4-5), good (6-7), great (8-9), and outstanding (10). If your sales run-rate is $10 million, determine whether that is a 1, a 5, or a 10. Your answer depends of course on whether you consider performance against budget, performance against stretch goals, or performance against "home-run-out-of-the-park" goals.
If your baseline for Board of Directors is two unfilled board seats - is that a 5 (mediocre) or a poor (2-3)? Only you can decide. Although this ultimately is a subjective process, you want to make it as objective as possible.

Step 4: Set new goals


Next, create a "gap" between where you are - your baseline - and your target for that factor. You already have a sales plan, so your gap exists between your current revenue and your budgeted revenue. You may consider your baseline a 5, and your target an 8. Implicit in this 1- 10 scale are judgements about your intentions: will reaching your budgeted revenue put you at 8 (almost great) or 10 (outstanding)? Where do you want to peg your efforts? If you've assessed your employee training at a 4 (mediocre), are you shooting for a 7 (good) or a 9 (great)? You can see from this how your measurement structure and goal system will impact how you allocate your company's resources and energy.

Step 5: Closing the gap

You now have a baseline and a target for each factor. Between them they define a factor gap - your challenge is to close it. Each gap becomes the focus of a meditation which asks the question: What will close the gap between our current level of this factor and our desired level? What possible actions will raise that measurement? You may have intuitive responses to these questions, and when appropriate, trust your gut. If need be, back that gut response with research - but only when cost effective.

(Sometimes the most cost effective research is implementation, particularly in simple matters.)
Use any idea generation process you are comfortable with. Develop several possible initiatives to raise the level of that factor. With luck your ideas will work together and harmonize in terms of impact or implementation requirements. If you create competing ideas, select the best alternatives. Choose based on return on investment, required resources, scheduling conflicts, time to impact, total cost, and likelihood of success versus risk of failure.

Depending on the specific factor, and the size of the gap, you may plan to close it in stages or shoot the gap all at once. You can launch one initiative at a time, or implement several initiatives in parallel. You may find my GamePlan!" methods useful in designing your gap-closing programs.
Once you launch your gap-closing initiatives, continually measure your results. Report your progress to participants and stakeholders, and post it publicly.

Step 6: “The Ben Franklin Rotation Program”


Each factor also gets a weight, which enables you to develop an overall score. Each week, re-rate all the factors on the score sheet, and graph your progress. You may also graph the overall score. Publish the score sheet and the graphs. You can establish a reward system based on individual progress, or, using the factor weights, you can develop a bonus structure which incentivizes total progress. This simple system will focus your attention on improving each one of your critical success factors. With carefully selected factors, you insure both rapid performance increases and balance in your company. This system simply shows the projection of the progress, so as to monitor if you are improving or not. It’s one way also on assessing the firm’s response on the critical factors.

Generally, the advantages of identifying CSFs are that they are simple to understand; they help focus attention on major concerns; they are easy to communicate to coworkers; they are easy to monitor; and they can be used in concert with strategic planning methodologies. Using critical success factors as an isolated event does not represent critical strategic thinking. But when used in conjunction with a planning process, identifying CSFs is extremely important because it keeps people focused. Clarifying the priority order of CSFs, measuring results, and rewarding superior performance will improve the odds for long-term success as well.



Sources:

http://www.e-competitors.com/Strategy/SBUPlanning/SBUPositioning/SBU_Critical.htm
http://rapidbi.com/created/criticalsuccessfactors.html
http://www.paullemberg.com/criticalfactors.html



my blog: http://www.arielserenado.blogspot.com








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Stihl Lhyn Samonte



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PostSubject: Assignment 6   Wed Dec 16, 2009 12:37 am

Identify and discuss the steps for "critical success factors" approach?

Critical success factor

Critical Success Factor (CSF) is the term for an element that is necessary for an organization or project to achieve its mission. It is a critical factor or activity required for ensuring the success of your business. The term was initially used in the world of data analysis, and business analysis. For example, a CSF for a successful Information Technology (IT) project is user involvement.

So many important matters can compete for your attention in business that it's often difficult to see the "wood for the trees". What's more, it can be extremely difficult to get everyone in the team pulling in the same direction and focusing on the true essentials. That's where Critical Success Factors (CSFs) can help. CSFs are the essential areas of activity that must be performed well if you are to achieve the mission, objectives or goals for your business or project.

By identifying your Critical Success Factors, you can create a common point of reference to help you direct and measure the success of your business or project. As a common point of reference, CSFs help everyone in the team to know exactly what's most important. And this helps people perform their own work in the right context and so pull together towards the same overall aims.

The idea of CSFs was first presented by D. Ronald Daniel in the 1960s. It was then built on and popularized a decade later by John F. Rockart, of MIT's Sloan School of Management, and has since been used extensively to help businesses implement their strategies and projects.
Inevitably, the CSF concept has evolved, and you may have seen it implemented in different ways. This article provides a simple definition and approach based on Rockart's original ideas.

The advantages of identifying CSFs are that they are simple to understand; they help focus attention on major concerns; they are easy to communicate to coworkers; they are easy to monitor; and they can be used in concert with strategic planning methodologies. Using critical success factors as an isolated event does not represent critical strategic thinking. But when used in conjunction with a planning process, identifying CSFs is extremely important because it keeps people focused. Clarifying the priority order of CSFs, measuring results, and rewarding superior performance will improve the odds for long-term success as well.

Critical success factors cannot be specifically defined for the masses because success can be defined quite differently by each individual, and for the goal at hand. Therefore, in order to identify critical success factors, it is first necessary to come to terms with your own personal definition of success. Each individual’s own definition of will be influenced by several key factors:

• Success is subject to individual interpretation based on upbringing, past experiences, role models, personal motivations and goals. For some it might be to own a home in an upscale neighborhood, while for others it might be a career in the Peace Corps. Carefully contemplate your definition of success based on your values—not what your brother-in-law or Madison Avenue tells you it is. Your own definition of personal success directly influences critical factors leading to that success.

• Your view of success will change at various times throughout your life. For example, what might be deemed successful in college or on your first job is very different from successfully raising a family or comfortably retiring in the Caribbean. Your definition of success will continue to change, so don’t make the error of pursuing an outdated version of it. Success factors will change over time.

• Personal success is sometimes measurable and sometimes not. Accumulating a certain amount of wealth is one way to measure success, but it is not the only way; a successful marriage may be far more meaningful to many people and can only be measured by how the two partners feel about each other as the years go by.

• Very few people achieve success accidentally. Most people who achieve success first defined it then planned for it; they set a goal to achieve it. Critical success factors change with the goal.

There are four steps of CSFs:

Industry CSF's follows from specific industry characteristics.

Different industries have different CSFs. Even within same industry CSFs are not identical from company to company. For example:
Objective: Achieve market share locally of 15%.
CSF: Increasing of customers quantity, increasing of competitiveness versus other local shops.

Strategy CSF's follows from the selected competitive strategy of the business.

It depends on how company positions itself on market, what is the strategy of business and development.
Objective: Decrease time of client servicing to 50%.
CSF: Install PC-based customer service system.

Environmental CSF's follows from economic or technological changes.

These factors represent environment in which company operates. They include things like the business climate, the economy, competitors, sociopolitical issues, technological improving and so on.
Objective: Expand assortment of goods to attract more consumers.
CSF: Discovery of new required local suppliers, arrangement of win-win relationship with them.

Temporal CSF's follows from internal organizational needs and changes.

These are temporary conditions or situations in which the organization must achieve success in order to ensure safety of successful accomplishment companies main goals.

A plan should be implemented that considers a platform for growth and profits as well as takes into consideration the following critical success factors:
• Money: positive cash flow, revenue growth, and profit margins.
• Your future: Acquiring new customers and/or distributors.
• Customer satisfaction: How happy they are.
• Quality: How good is your product and service?
• Product or service development: What's new that will increase business with existing customers and attract new ones?
• Intellectual capital: Increasing what you know is profitable.
• Strategic relationships: New sources of business, products and outside revenue.
• Employee attraction and retention: Your ability to extend your reach.
• Sustainability: Your personal ability to keep it all going.

The 5 Critical Success Factors in Business

There are five business success factors (critically important core profit principles) that all businesses share - both small business and large. In times of economic crisis like these, they are essential. And, they can make the difference between just getting by - or you getting ahead in your business.

Here, we'll explore what they are - and how you can put them to work for you in your own business. These principles form the basis for most success in business achieved by entrepreneurs, business owners, business managers, and professionals. Without following them at least to some extent, you'll find business to be a struggle - and much less rewarding than it could be.

As you read this, see how well your own thinking and actions in business stack up to these five core principles:

1) Profits are essential for your business to succeed - they are what pays you.

You don't have to look far to find examples of businesses imploding due to lack of profits. (The current banking and financial crisis immediately comes to mind... Or, remember the dot-com bubble?... the spend, spend, spend your way to market share type of thinking.) And, those are just some larger, more visible examples... small businesses are at even more risk.

Ultimately, profits are the essential key ingredient for business survival - and your focus on them is key. The very existence of your business depends on a steady-stream of profits... to pay your bills... your salary... your employees... your vendors and suppliers... and to secure your financial future.

Profits make the difference between the success or failure of your enterprise. They're the essence of being in business and are the fruits of your labor. Without profits (or deep pockets), you can't last long.

2) Most businesses miss profit opportunities on almost every transaction or customer/client relationship - and are limiting their incomes without even knowing it.

Here again, you won't have to look far for examples. Just think of all the leads that don't get proper follow-up, the customers/clients that receive only occasional communications (if any), the up-sells, cross-sells and add-on sales that could have been part of a given transaction, the unrealized intangible opportunities that exist in your customer/client or vendor/supplier relationships - and you can begin to see a sad pattern.

It's a pattern of profit opportunities gone by... wasted utilization of assets... or under-realized profit potential in your transactions. In many cases, business owners, managers and professionals are completely unaware of their lost profit opportunities.

Make your expenditure of time, energy, capital, and resources produce more for you - and capture the money that most businesses miss. Think about your sales, marketing, and advertising process as a total package - and create, test, and put in place processes that take advantage of strengths in your business.

3) Stability and security comes from creating a "Web of Profits" in your business.

Do you have a number of different sources within your business to support you? Or, are you relying on only a few? Or, even worse, relying on only ONE primary source of profit?

The majority of businesses rely on fewer than five profit sources - and think in terms of "profit centers." In other words, a collection of different channels of profit from individual sales of products or services (retail), bulk sales (wholesale), joint ventures, ownership interests, licensing and/or other arrangements, and so on.

But, when you create a "Web of Profits" in your business - that is, an interconnected approach that integrates a variety of profit sources and activities together into a single unit of functionality - you stand a better chance of leveraging your business in new ways.

4) The focus on Increasing Profits is more beneficial than the focus on Cost-Cutting.

In times of recession or economic crisis, sometimes cost-cutting is the only logical and sane option. If you're bleeding... you stop the bleeding before anything else. But, when it comes to cost-cutting, the effect is temporary and fleeting. Once you've drastically reduced your expenses, any additional cost-cutting might hurt your business's effectiveness and viability.

Crisis management aside, it's much better to focus on getting more business, to create new profit sources, run better promotions, do better advertising and marketing, and generally operate your business in a more customer/client oriented way.

That's what eases the pressure from high-costs... and provides you with what you need from your business. The thinking that goes into a profit-oriented focus and mindset can often provide innovative and inspirational breakthroughs in results.

5) Strategically plan for Profits - and take the specific action steps needed to implement your plan.

Being laser-focused on profits - rather than your strategic planning being primarily focused on revenue - takes you to the next level in your business plan. You'll be able to see alternative profit possibilities - and the action steps needed - so you can build them directly into your plan.

By their very nature, business plans focus on the bottom-line - and usually they just focus on the obvious sources - not necessarily on the alternative profit possibilities. And it's these alternative profits that most businesses miss... profits that could even eclipse what's being produced by your current business activities.


Sources:
http://en.wikipedia.org/wiki/Critical_success_factor
http://www.mindtools.com/pages/article/newLDR_80.htm
http://www.e-competitors.com/Strategy/SBUPlanning/SBUPositioning/SBU_Critical.htm
http://www.articlesbase.com/business-articles/the-5-critical-success-factors-in-business-639661.html


mY bLog:http://stihlyn.blogspot.com/
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John Paul Pulido



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PostSubject: Assignment 6   Wed Dec 16, 2009 2:13 am

According to the wikipedia.org Critical Success Factor (CSF) is the term for an element that is necessary for an organization or project to achieve its mission. It is a critical factor or activity required for ensuring the success of your business. The term was initially used in the world of data analysis, and business analysis. For example, a CSF for a successful Information Technology (IT) project is user involvement.

Money:

Cash flow refers to the movement of cash into or out of a business, a project, or a financial product. It is usually measured during a specified, finite period of time. Measurement of cash flow can be used
- to determine a project's rate of return or value. The time of cash flows into and out of projects are used as inputs in financial models such as internal rate of return, and net present value.
- to determine problems with a business's liquidity. Being profitable does not necessarily mean being liquid. A company can fail because of a shortage of cash, even while profitable.
- as an alternate measure of a business's profits when it is believed that accrual accounting concepts do not represent economic realities. For example, a company may be notionally profitable but generating little operational cash (as may be the case for a company that barters its products rather than selling for cash). In such a case, the company may be deriving additional operating cash by issuing shares, or raising additional debt finance.
- cash flow can be used to evaluate the 'quality' of Income generated by accrual accounting. When Net Income is composed of large non-cash items it is considered low quality.
- to evaluate the risks within a financial product. E.g. matching cash requirements, evaluating default risk, re-investment requirements, etc.

Your future:

Of course you must need to consider the future. You must consider what will happen to your company after how many years.

Customer satisfaction:

Customer satisfaction, a business term, is a measure of how products and services supplied by a company meet or surpass customer expectation. It is seen as a key performance indicator within business and is part of the four perspectives of a Balanced Scorecard.

In a competitive marketplace where businesses compete for customers, customer satisfaction is seen as a key differentiator and increasingly has become a key element of business strategy.

There is a substantial body of empirical literature that establishes the benefits of customer satisfaction for firms.

One important thing is the feedback of the customers for the services you offered because the future of the company depends on the love of the customers to your company.

Quality:

The quality of your services must be considered so that many customers will go back and avail your services again.

Product or service development:

New things that will help your company increase in profit and customer’s satisfaction.


Intellectual capital:

Attend workshops and seminars on how to improve your business.

Strategic relationships:

Consider outsourcing.

Employee attraction and retention:

Know your employees and make friends with them.

Sustainability:

Your personal ability to keep it all going.

References:
http://en.wikipedia.org/wiki/Critical_success_factor
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brian c. namuag



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PostSubject: Assignment # 6   Wed Dec 16, 2009 2:26 am



We are to identify and discuss the steps for "critical success factors" approach. Every individual has a critical success factors in life. This would only means that a key to success should posses a wood curve for. Let me give some parameters of what and how a critical success factor is.


According to wikipedia Critical Success Factor (CSF) is the term for an element that is necessary for an organization or project to achieve its mission. It is a critical factor or activity required for ensuring the success of your business. The term was initially used in the world of data analysis, and business analysis. For example, a CSF for a successful Information Technology (IT) project is user involvement.

So many important matters can compete for your attention in business that it's often difficult to see the "wood for the trees". What's more, it can be extremely difficult to get everyone in the team pulling in the same direction and focusing on the true essentials.

That's where Critical Success Factors (CSFs) can help. CSFs are the essential areas of activity that must be performed well if you are to achieve the mission, objectives or goals for your business or project.

By identifying your Critical Success Factors, you can create a common point of reference to help you direct and measure the success of your business or project.

As a common point of reference, CSFs help everyone in the team to know exactly what's most important. And this helps people perform their own work in the right context and so pull together towards the same overall aims.

The idea of CSFs was first presented by D. Ronald Daniel in the 1960s. It was then built on and popularized a decade later by John F. Rockart, of MIT's Sloan School of Management, and has since been used extensively to help businesses implement their strategies and projects.

Inevitably, the CSF concept has evolved, and you may have seen it implemented in different ways. This article provides a simple definition and approach based on Rockart's original idea.

Critical success factors (CSFs) have been used significantly to present or identify a few key factors that organisations should focus on to be successful. As a definition, critical success factors refer to "the limited number of areas in which satisfactory results will ensure successful competitive performance for the individual, department, or organisation” (Rockart and Bullen, 1981). Identifying CSFs is important as it allows firms to focus their efforts on building their capabilities to meet the CSFs, or even allow firms to decide if they have the capability to build the requirements necessary to meet critical success factors (CSFs).


Success factors were already being used as a term in management when Rockart and Bullen reintroduced the concept to provide greater understanding of the concept and, at the same time, give greater clarity of how CSFs can be identified.

MAIN ASPECTS OF CSFs


CSFs are tailored to a firm's or manager's particular situation as different situations (e.g. industry, division, individual) lead to different critical success factors. Rockart and Bullen presented five key sources of CSFs: the industry, competitive strategy and industry position, environmental factors, temporal factors, and managerial position (if considered from an individual's point of view). Each of these factors is explained in greater detail below.

HOW TO WRITE GOOD CSFs

In an attempt to write good CSFs, a number of principles could help guide writers. These principles are:

• Ensure a good understanding of the environment, the industry and the company – It was shown that CSFs have five primary sources, and it is important to have a good understanding of the environment, the industry and the company in order to be able to write them well. These factors are customised for companies and individuals and the customisation results from the peculiarity of the organisation. This peculiarity stems from an organisation's strategy, current position, and resources and capabilities.
• Build knowledge of competitors in the industry – While this principle can be encompassed in the previous one, it is worth highlighting separately as it is critical to have a good understanding of competitors as well in identifying an organisation's CSFs. Knowing where competitors are positioned, what their resources and capabilities are, and what strategies they will pursue can have an impact on an organisation's strategy and also resulting CSFs.
• Develop CSFs which result in observable differences – A key impetus for the development of CSFs was the notion that factors which get measured are more likely to be achieved versus factors which are not measured. Thus, it is important to write CSFs which are observable or possibly measurable in certain respects such that it would be easier to focus on these factors. These don't have to be factors that are measured quantitatively as this would mimic key performance indicators; however, writing CSFs in observable terms would be helpful.
• Develop CSFs that have a large impact on an organisation's performance – By definition, CSFs are the "most critical" factors for organisations or individuals. However, due care should be exercised in identifying them due to the largely qualitative approach to identification, leaving many possible options for the factors and potentially results in discussions and debate. In order to truly have the impact as envisioned when CSFs were developed, it is important to thus identify the actual CSFs, i.e. the ones which would have the largest impact on an organisation's (or individual's) performance.


Conclusion

CSFs are used by organisations to give focus on a number of factors that help define its success. They help the organisation and its personnel to understand the key areas in which to invest their resources and time. Ideally, these CSFs are observable in terms of the impact on the organisation to allow it to have guidance and indications on its achievement of them.

CSFs can be utilised in both the organisation and the individual levels. Their identification is largely qualitative and can result in differing opinions in pinpointing them. Nevertheless, it is an approach that should be pursued as it provides value in giving due focus to a limited set of factors, which are deemed to be the most critical for an organisation or individual.

The company should have a critical success factors in order to know the improvement made by the company from the past up to the present generation. This is possible to every organization even to a smaller unit of business to maintain its progress and limits its capacity. This would show that critical success factors indeed contribute a big help to individuals not only for a certain corporation but also to a person.

Success is many things to many people. Worldbook defines success as a favorable result or wished for ending through the achievement of goals. That is, if one attains a desired goal through achievement, he would be considered a success. However, a successful character, cannot be produced from one successful feat. The true indicator of success is not what is accomplished, but what is felt. In order to be successful, one must be happy.
One of the most complex examples of success is the winning of money. Is the winning of money considered successful? If a person buys a lottery ticket, he is setting his goal on winning. In addition, if the person wins, he is obviously happy. However, this person is not considered successful. Although his goal is to win, he has no control over winning or losing. Achieving goals means working for them and knowing the result. The person is going to be elated about winning but not about achieving goals. Happiness from success results from the achievements accomplished.


Source:
http://www.coursework4you.co.uk/essays-and-dissertations/critical-success-factors.php


My Blog: http://brian-takealook.blogspot.com/


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Shiela Marie P. Nara



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PostSubject: Re: Assignment 6 (Due: December 30, 2009, before 01:00pm)   Wed Dec 16, 2009 5:20 am

Critical Success Factors


Identifying the things that really matter for success
So many important matters can compete for your attention in business that it's often difficult to see the "wood for the trees". What's more, it can be extremely difficult to get everyone in the team pulling in the same direction and focusing on the true essentials.
Most smaller and more pragmatic businesses can still use CSF’s but we need to take a different, more pragmatic approach.
Critical Success Factors have been used significantly to present or identify a few key factors that organizations should focus on to be successful.
As a definition, critical success factors refer to "the limited number of areas in which satisfactory results will ensure successful competitive performance for the individual, department, or organization”.

That's where Critical Success Factors (CSFs) can help. CSFs are the essential areas of activity that must be performed well if you are to achieve the mission, objectives or goals for your business or project.
By identifying your Critical Success Factors, you can create a common point of reference to help you direct and measure the success of your business or project.
As a common point of reference, CSFs help everyone in the team to know exactly what's most important. And this helps people perform their own work in the right context and so pull together towards the same overall aims.
The idea of CSFs was first presented by D. Ronald Daniel in the 1960s. It was then built on and popularized a decade later by John F. Rockart, of MIT's Sloan School of Management, and has since been used extensively to help businesses implement their strategies and projects.
Inevitably, the CSF concept has evolved, and you may have seen it implemented in different ways. This article provides a simple definition and approach based on Rockart's original ideas.
Rockart defined CSFs as:
"The limited number of areas in which results, if they are satisfactory, will ensure successful competitive performance for the organization. They are the few key areas where things must go right for the business to flourish. If results in these areas are not adequate, the organization's efforts for the period will be less than desired."

He also concluded that CSFs are "areas of activity that should receive constant and careful attention from management."

Critical Success Factors are strongly related to the mission and strategic goals of your business or project. Whereas the mission and goals focus on the aims and what is to be achieved, Critical Success Factors focus on the most important areas and get to the very heart of both what is to be achieved and how you will achieve it.
Types of Critical Success Factor

There are four basic types of CSF's

They are:
Industry CSF's resulting from specific industry characteristics;
Strategy CSF's resulting from the chosen competitive strategy of the business;
Environmental CSF's resulting from economic or technological changes; and
Temporal CSF's resulting from internal organizational needs and changes.

Things that are measured get done more often than things that are not measured.

Each CSF should be measurable and associated with a target goal. You don't need exact measures to manage. Primary measures that should be listed include critical success levels (such as number of transactions per month) or, in cases where specific measurements are more difficult, general goals should be specified (such as moving up in an industry customer service survey).
Using the Tool: An Example

CSFs are best understood by example. Consider a produce store "Farm Fresh Produce", whose mission is:

"To become the number one produce store in Main Street by selling the highest quality, freshest farm produce, from farm to customer in under 24 hours on 75% of our range and with 98% customer satisfaction."

(For more on this example, and how to develop your mission statement, see our article on Vision Statements and Mission Statements.)

The strategic objectives of Farm Fresh are to:
Gain market share locally of 25%.
Achieve fresh supplies of "farm to customer" in 24 hours for 75% of products.
Sustain a customer satisfaction rate of 98%.
Expand product range to attract more customers.
Have sufficient store space to accommodate the range of products that customers want.

In order to identify possible CSFs, we must examine the mission and objectives and see which areas of the business need attention so that they can be achieved. We can start by brainstorming what the Critical Success Factors might be (these are the "Candidate" CSFs.)Objective Candidate Critical Success Factors
Gain market share locally of 25%
Increase competitiveness versus other local stores
Attract new customers
Achieve fresh supplies from "farm to customer" in 24 hours for 75% of products
Sustain successful relationships with local suppliers
Sustain a customer satisfaction rate of 98%
Retain staff and keep up customer-focused training
Expand product range to attract more customers
Source new products locally
Extend store space to accommodate new products and customers
Secure financing for expansion
Manage building work and any disruption to the business


Once you have a list of Candidate CSFs, it's time to consider what is absolutely essential and so identify the truly Critical Success Factors.

And this is certainly the case for Farm Fresh Produce. One CSF that we identify from the candidate list is "Sustain successful relationships with local suppliers." This is absolutely essential to ensure freshness and to source new products.

Another CSF is to attract new customers. Without new customers, the store will be unable to expand to increase market share.

A third CSF is financing for expansion. The store's objectives cannot be met without the funds to invest in expanding the store space.
Five key sources of Critical Success Factors


MAIN ASPECTS OF Critical Success Factors and their use in analysis


CSF's are tailored to a firm's or manager's particular situation as different situations (e.g. industry, division, individual) lead to different critical success factors. Rockart and Bullen presented five key sources of CSF's:
The industry,
Competitive strategy and industry position,
Environmental factors,
Temporal factors, and
Managerial position (if considered from an individual's point of view). Each of these factors is explained in greater detail below.


Using the Tool: Summary Steps

In reality, identifying your CSFs is a very iterative process. Your mission, strategic goals and CSFs are intrinsically linked and each will be refined as you develop them.

Here are the summary steps that, used iteratively, will help you identify the CSFs for your business or project:

Step One: Establish your business's or project's mission and strategic goals (click here for help doing this.)

Step Two: For each strategic goal, ask yourself "what area of business or project activity is essential to achieve this goal?" The answers to the question are your candidate CSFs.
To make sure you consider all types of possible CSFs, you can use Rockart's CSF types as a checklist.
Industry - these factors result from specific industry characteristics. These are the things that the organization must do to remain competitive.

Environmental - these factors result from macro-environmental influences on an organization. Things like the business climate, the economy, competitors, and technological advancements are included in this category.
Strategic - these factors result from the specific competitive strategy chosen by the organization. The way in which the company chooses to position themselves, market themselves, whether they are high volume low cost or low volume high cost producers, etc.
Temporal - these factors result from the organization's internal forces. Specific barriers, challenges, directions, and influences will determine these CSFs.

Step Three: Evaluate the list of candidate CSFs to find the absolute essential elements for achieving success - these are your Criticial Success Factors.

As you identify and evaluate candidate CSFs, you may uncover some new strategic objectives or more detailed objectives. So you may need to define your mission, objectives and CSFs iteratively.

Step Four: Identify how you will monitor and measure each of the CSFs.

Step Five:
Communicate your CSFs along with the other important elements of your business or project's strategy.

Step Six: Keep monitoring and reevaluating your CSFs to ensure you keep moving towards your aims. Indeed, whilst CSFs are sometimes less tangible than measurable goals, it is useful to identify as specifically as possible how you can measure or monitor each one.
Key Points

Critical Success Factors are the areas of your business or project that are absolutely essential to its success. By identifying and communicating these CSFs, you can help ensure your business or project is well-focused and avoid wasting effort and resources on less important areas. By making CSFs explicit, and communicating them with everyone involved, you can help keep the business and project on track towards common aims and goals.

References:

http://www.mindtools.com/pages/article/newLDR_80.htm

http://rapidbi.com/created/criticalsuccessfactors.html

My blog:
http://shielamariepnara.blogspot.com/2009/12/mis-26-critival-success-factors.html
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Alfredo V. Ala-an



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PostSubject: Assignment 6   Wed Dec 16, 2009 6:32 am

Identify and discuss the steps for "critical success factors" approach? (at least 1,500 words)

First let us just define the what is the meaning of the critical success factors.

Critical Success Factor (CSF) is the term for an element that is necessary for an organization or project to achieve its mission. It is a critical factor or activity required for ensuring the success of your business. The term was initially used in the world of data analysis, and business analysis. For example, a CSF for a successful Information Technology (IT) project is user involvement.

Critical Success Factors
Identifying the things that really matter for success

So many important matters can compete for your attention in business that it's often difficult to see the "wood for the trees". What's more, it can be extremely difficult to get everyone in the team pulling in the same direction and focusing on the true essentials.

That's where Critical Success Factors (CSFs) can help. CSFs are the essential areas of activity that must be performed well if you are to achieve the mission, objectives or goals for your business or project.

By identifying your Critical Success Factors, you can create a common point of reference to help you direct and measure the success of your business or project.

As a common point of reference, CSFs help everyone in the team to know exactly what's most important. And this helps people perform their own work in the right context and so pull together towards the same overall aims.

The idea of CSFs was first presented by D. Ronald Daniel in the 1960s. It was then built on and popularized a decade later by John F. Rockart, of MIT's Sloan School of Management, and has since been used extensively to help businesses implement their strategies and projects.

Inevitably, the CSF concept has evolved, and you may have seen it implemented in different ways. This article provides a simple definition and approach based on Rockart's original ideas.

Rockart defined CSFs as:
"The limited number of areas in which results, if they are satisfactory, will ensure successful competitive performance for the organization. They are the few key areas where things must go right for the business to flourish. If results in these areas are not adequate, the organization's efforts for the period will be less than desired."

He also concluded that CSFs are "areas of activity that should receive constant and careful attention from management."

Critical Success Factors are strongly related to the mission and strategic goals of your business or project. Whereas the mission and goals focus on the aims and what is to be achieved, Critical Success Factors focus on the most important areas and get to the very heart of both what is to be achieved and how you will achieve it.

Critical Steps to Success

These are, in fact, the first seven steps in our clients' journey to generational wealth. These steps represent the keys to successful investing and work well together to create a powerful investment machine. Here are the first three. The final four we would take great pleasure in presenting to you in person.

Step 1 Investor Temperament

Stay calm, think long term and don't panic or react adversely to market conditions. 'Chasing' returns or 'hot stocks' is also inappropriate behaviour for the long-term investor. We encourage our clients to take a long-term, strategic approach and remain level-headed about media opinions.

Discussion:

Calm type of person, i think is very a good trait in order to be successful in a any type of field. Facing a problem is not an easy job but fro the beginning we start to think in this world we start to face some problems in our life so it is natural to us with this type of facing this problems. Planning with a long term- term as the article said should be for the inverstors.

Step 2 Stock Selection

The selection of appropriate securities begins with quantitative filters. These filters initially screen stocks based on their cash flow earnings, their gearing and stock liquidity. We then incorporate qualitative factors such as industry thematics, management quality and other key business drivers. As you would expect, an intensive research process is then undertaken of each prospective stock.

Discussion:

Stock selection is also a critical aspect in this type of field. Selecting some apropriate stocks in your field should be because it is a waste from the companies budget if you cannot chose the right stocks that your company should have. Because the purpose of fouding a ompany is to earn/ to profit not to waste many.

Step 3 Specialist Management

The management of an elite portfolio takes experience, skill and a strategic approach to investment management. We encourage our clients to develop an appreciation for this unique skill set. Although we are long-term investors we keep your portfolio under constant review to ensure stock weightings, sector exposure and diversification are closely monitored. On a daily basis, we apply our experience to your individual stock weightings and provide access to opportunities such as IPO's and Placements.

Discussion:

Having some speacialist management personnel in the company is an advantage from your company. Searching those type of persons are quite tough. If you ahve this type of personnel, you should plan well inorder to grow your company in more profitable, successful and use their skills to help others.

resources:
http://en.wikipedia.org/wiki/Critical_success_factor
http://www.mindtools.com/pages/article/newLDR_80.htm
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kate karen rasonable



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PostSubject: Re: Assignment 6 (Due: December 30, 2009, before 01:00pm)   Wed Dec 16, 2009 1:03 pm

Critical Success Factors

The idea of identifying critical success factors as a basis for determining the information needs of managers was proposed by Daniel (1961) but popularized by Rockart (1979). The idea is very simple: in any organization certain factors will be critical to the success of that organization, in the sense that, if objectives associated with the factors are not achieved, the organization will fail - perhaps catastrophically so. Rockart (1979: 85), by referring to Daniel (1961), gives the following as an example of the CSFs: new product development, good distribution, and effective advertising for the food processing industry - factors that remain relevant today for many firms.

Competitive advantage, following Porter (1985), was taken to mean, the ability of a firm to provide better value for its customers through lower prices, higher quality, or benefits not available elsewhere. The primary purpose was to test the idea that the information intensive areas of an organization could be identified within the value chain by using the CSF technique to indicate the critical areas and, thereby, enable the identification of corporate information needs. Corporate information needs were defined as those needs for information that must be
satisfied if the organization is to achieve its strategic aims. The proposition was that those parts of the value chain that were perceived by organizational members to be of critical significance would be the areas in which effort ought to be concentrated so that the information systems could be effective.

The case studies were carried out in UK universities by applying a qualitative research strategy simultaneously with the cases testing the SIM methodology in the pharmaceutical and publishing sectors in Finland. Qualitative, open-ended interviews were conducted to identify the critical areas, related information needs and the use of information systems. Grounded theory was applied to define the CSFs in both the UK and Finnish studies. An understanding of the production, marketing and managerial processes within the Finnish companies and the market conditions within which the companies operated was gained by an examination of relevant documentation. The SIM study relied on theoretical sampling – the cases were chosen for replicating the test to provide examples from very knowledge-based fields of polar types in order to ensure valid findings.

Identifying the things that really matter for success

So many important matters can compete for your attention in business that it's often difficult to see the "wood for the trees". What's more, it can be extremely difficult to get everyone in the team pulling in the same direction and focusing on the true essentials.

That's where Critical Success Factors (CSFs) can help. CSFs are the essential areas of activity that must be performed well if you are to achieve the mission, objectives or goals for your business or project.
By identifying your Critical Success Factors, you can create a common point of reference to help you direct and measure the success of your business or project.

As a common point of reference, CSFs help everyone in the team to know exactly that's most important. And this helps people perform their own work in the right context and so pull together towards the same overall aims.

The idea of CSFs was first presented by D. Ronald Daniel in the 1960s. It was then built on and popularized a decade later by John F. Rockart, of MIT's Sloan School of Management, and has since been used extensively to help businesses implement their strategies and projects.

Inevitably, the CSF concept has evolved, and you may have seen it implemented in different ways. This article provides a simple definition and approach based on Rockart's original ideas. Rockart defined CSFs as:

"The limited number of areas in which results, if they are satisfactory, will ensure successful competitive performance for the organization. They are the few key areas where things must go right for the business to flourish. If results in these areas are not adequate, the organization's efforts for the period will be less than desired."

He also concluded that CSFs are "areas of activity that should receive constant and careful attention from management."

Critical Success Factors are strongly related to the mission and strategic goals of your business or project. Whereas the mission and goals focus on the aims and what is to be achieved, Critical Success Factors focus on the most important areas and get to the very heart of both what is to be achieved and how you will achieve it.

To describe the steps in CSF approach, there are identified five basic activities:
• defining scope
• collecting data
• analyzing data
• deriving CSFs
• analyzing CSFs

Activity One: Defining the CSF Scope
There are two primary steps in Activity One:
Step 1: Choosing operational CSF.

If a set of operational unit CSFs is being developed, the scope of the exercise may be limited to the operational unit and some of the corporate or organizational areas that are important to the operational unit’s success. Thus, when focusing on an operational unit, it may only be necessary to include managers within the particular operational unit and their representatives at the executive level of the organization. However, because some operational units are often dependent on others (for example, where corporate services are provided to subordinate units), it may also be necessary to expand the scope of the CSF exercise to include other specific operational units as appropriate.

Step 2: Selecting a participant.

Determining who to include as participants in the CSF activity is dependent on several considerations:
• the type of CSFs being developed (enterprise or operational unit)
• the structure of the organization (many layers vs. a flat structure)
• the unique operating conditions of the organization (international presence, large divisions in different industries, etc.)
• the purpose and objective for developing CSFs

Activity Two: Collecting Data
There are four primary steps in Activity Two:

Step 1: Collect and Review critical Documents

A document review is a very effective means for obtaining an understanding of the focus and direction of an organization or operational unit. Most organizations document their purpose, vision, and values in a mission statement
that is known to all employees.

Step 2: Develop interview questions

The most important data collection activity is conducting interviews with participants. In this activity, the participants have an opportunity to talk about their management challenges and their contributions to the organization and/or the operational unit’s successes and failures. The interactive nature of the interview process provides opportunities for clarification and for guiding the interview in areas that might expose particular barriers and obstacles to accomplishing the mission.

Step 3: Plan and Conduct Participant interviews.

1. State the purpose of the interview.
2. Clarify the participant’s view of the organization or operational unit’s mission.
3. Clarify the participant’s view of his or her role in the organization or operational unit.
4 Discuss the participant’s goals and objectives.
5. Ask a series of open-ended questions to elicit CSF data.
6. Summarize the interview by playing back the important points.
7. Ask for priority.
8. Ask for measures.
9. Reserve the right to follow up and get confirmation of interview notes if necessary.

Step 4: Organize Collected Data.

Document review and interview notes provide the core data for developing CSFs. Thus, all of the documents collected and the interview notes that have been recorded must be compiled and organized to facilitate analysis.

Activity Three: Analysis
There are three primary steps in activity three:

Step 1: Develop activity statements.

Activity statements are statements that are harvested from interview notes and documents that reflect what managers do or believe they and the organization should be doing to ensure success. They collectively describe the operational goals, objectives, and activities performed by managers throughout the organization or in the operational unit that supports the existence and/or attainment of a CSF.

Step 2: Place activity statements into affinity groupings.
The next step in creating CSFs is to perform an initial affinity grouping of the activity statements gathered from document review and interview notes. Simply stated, affinity grouping is a process for organizing ideas, thoughts, concepts, etc.

Step 3: Develop Supporting Themes.

A final step required before the development of CSFs is to develop supporting themes. Supporting themes represent a group of activity statements and will be used as the foundation from which to create the CSFs.

Activity Four: Deriving CSFs
There are three primary steps in Activity Four:

Step 1: Group Summary Themes

Once supporting themes have been developed for each group of activity statements, it is important to perform an additional affinity grouping exercise using the supporting themes. This helps to bring together similar supporting themes into groups that will result in CSFs.

Step 2: Derive CSF.

Step 3: Refine and Combine CSF.

Activity Five: Analyzing CSFs
There are four primary steps in Activity Five:

Step 1. Determine comparison criteria.

The initial step in performing affinity analysis is to determine which comparison criteria to gather. Many organizations perform more than one type of affinity analysis with CSFs, so this may require the gathering of significant data outside of the CSF activity. Consider the objectives for performing the analysis to determine which data to collect and compare.

Step 2. Develop a comparison matrix.

Once the comparison criteria are established, a matrix should be developed using a spreadsheet or other method that can be easily reconfigured and sorted if necessary.

Step 3. Determine the intersections.

Next, the intersections between CSFs and the chosen criteria must be decided on. This can be a large and somewhat difficult task, but it is very important for analyzing relationships. It may be necessary to consult with other organizational and operational unit personnel to determine which relationships exist. One caution—performing this activity haphazardly can result in flawed and inaccurate analysis.

Step 4. Analyze relationships.

Finally, look at the relationships between CSFs and the chosen criteria. Ask questions about all intersections, not only those that have been marked.
- If a relationship appears to exist, what does this mean?
- If there is no relationship, what does this indicate?
- Does a relationship exist that is not marked?
- Should a relationship exist that has not yet been identified?
- Are there too many or not enough intersections? If so, what does this mean?

References:
http://informationr.net/ir/6-3/paper108.html
http://www.mindtools.com/pages/article/newLDR_80.htm
www.cert.org/archive/pdf/04tr010.pdf
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PostSubject: Re: Assignment 6 (Due: December 30, 2009, before 01:00pm)   Wed Dec 16, 2009 9:32 pm

Identify and discuss the steps for "critical success factors" approach? (at least 1,500 words)


Critical Success Factor (CSF) is the term for an element that is necessary for an organization or project to achieve its mission. It is a critical factor or activity required for ensuring the success of your business. The term was initially used in the world of data analysis, and business analysis. For example, a CSF for a successful Information Technology (IT) project is user involvement.


Critical Success Factors have been used significantly to present or identify a few key factors that organizations should focus on to be successful.

As a definition, critical success factors refer to "the limited number of areas in which satisfactory results will ensure successful competitive performance for the individual, department, or organization”.
Being Practical
As you read this and many other resources on the internet you will discover that there are potentially a confusing variety of definitions and uses of Critical Success Factors.
Before you start the journey looking at CSFs it is important to realise that the specific factors relevant for you will vary from business to business and industry to industry. The key to using CSFs effectively is to ensure that your definition of a factor of your organizations activity which is central to its future will always apply.
Therefore success in determining the CSFs for your organization is to determine what is central to its future and achievement of that future.
This page is primarily written for students of management and business, to keep things simple for application in smaller organizations remember to only have 5-7 critical factors for YOUR organization, and I am sure one of those will be cashflow!


How are they important to your business?

Identifying CSF's is important as it allows firms to focus their efforts on building their capabilities to meet the CSF's, or even allow firms to decide if they have the capability to build the requirements necessary to meet Critical Success Factors (CSF's).
Academic Background/ History
The principle of identifying critical success factors as a basis for determining the information needs of managers was proposed by RH Daniel (1961 Harvard Business Review - HBR) as an interdisciplinary approach with a potential usefulness in the practice of evaluation within library and information units but popularized by F Rockart (1979 Harvard Business Review - HBR). In time many academics have applied the methodology increasingly outside the educational establishment.

The idea is very simple: in any organization certain factors will be critical to the success of that organization, in the sense that, if objectives associated with the factors are not achieved, the organization will fail - perhaps catastrophically so.

The following as an example of generic CSF's:
• New product development,
• Good distribution, and
• Effective advertising

Factors that remains relevant today for many organizations.

dentifying the things that really matter for success
So many important matters can compete for your attention in business that it's often difficult to see the "wood for the trees". What's more, it can be extremely difficult to get everyone in the team pulling in the same direction and focusing on the true essentials.
That's where Critical Success Factors (CSFs) can help. CSFs are the essential areas of activity that must be performed well if you are to achieve the mission, objectives or goals for your business or project.
By identifying your Critical Success Factors, you can create a common point of reference to help you direct and measure the success of your business or project.
As a common point of reference, CSFs help everyone in the team to know exactly what's most important. And this helps people perform their own work in the right context and so pull together towards the same overall aims.
The idea of CSFs was first presented by D. Ronald Daniel in the 1960s. It was then built on and popularized a decade later by John F. Rockart, of MIT's Sloan School of Management, and has since been used extensively to help businesses implement their strategies and projects.
Inevitably, the CSF concept has evolved, and you may have seen it implemented in different ways. This article provides a simple definition and approach based on Rockart's original ideas.

The actual development or history of the approach

With a phrase like Critical Success Factors having 'common usage' within technical environments it is difficult to identify its true history in the context of business, management and human resources. One test for originality is the use of the TLA (Three Letter Acronym) of CSF. And one of the earliest uses of this is by
Definitions
Critical Success Factor
an element of organizational activity which is central to its future success. Critical success factors may change over time, and may include items such as product quality, employee attitudes, manufacturing flexibility, and brand awareness. This can enable analysis.
Critical Success Factor
any of the aspects of a business that are identified as vital for successful targets to be reached and maintained. Critical success factors are normally identified in such areas as production processes, employee and organization skills, functions, techniques, and technologies. The identification and strengthening of such factors may be similar. ..
Critical Success Factor (CSF) or Critical Success Factors
is a business term for an element which is necessary for an organization or project to achieve its mission. For example, a CSF for a successful Information Technology (IT) project is user involvement.

Using the term
The term “Critical Success Factor” is used differently, due to ambiguity of the word “critical”,
back and forth translations into other languages and interpretation when analyzed in portfolios:
1. Definition 1: “critical” = important, key, determining, vital, strategic, etc.
2. Definition 2: “critical” = alarming, anxious, etc. (as shown within the diagram = top left):
Five key sources of Critical Success Factors
MAIN ASPECTS OF Critical Success Factors and their use in analysis
CSF's are tailored to a firm's or manager's particular situation as different situations (e.g. industry, division, individual) lead to different critical success factors. Rockart and Bullen presented five key sources of CSF's:

1. The industry,
An industry's set of characteristics define its own CSF's Different industries will thus have different CSF's, for example research into the CSF's for the Call centre, manufacturing, retail, business services, health care and education sectors showed each to be different after starting with a hypothesis of all sectors having their CSF's as market orientation, learning orientation, entrepreneurial management style and organizational flexibility.
In reality each organization has its own unique goals so while thee may be some industry standard - not all firms in one industry will have identical CSF's.
Some trade associations offer benchmarking across possible common CSF's.

2. Competitive strategy and industry position,
Not all firms in an industry will have the same CSF's in a particular industry. A firm's current position in the industry (where it is relative to other competitors in the industry and also the market leader), its strategy, and its resources and capabilities will define its CSF's
The values of an organization, its target market etc will all impact the CSF's that are appropriate for it at a given point in time.

3. Environmental factors,
These relate to environmental factors that are not in the control of the organization but which an organization must consider in developing CSF's Examples for these are the industry regulation, political development and economic performance of a country, and population trends.
An example of environmental factors affecting an organization could be a de-merger.

4. Temporal factors, and
Temporal factors are temporary or one-off CSF's resulting from a specific event necessitating their inclusion.
Theoretically these would include a firm which "lost executives as a result of a plane crash requiring a critical success factor of rebuilding the executive group".
Practically, with the evolution and integration of markets globally, one could argue that temporal factors are not temporal anymore as they could exist regularly in organizations.
For example, a firm aggressively building its business internationally would have a need for a core group of executives in its new markets. Thus, it would have the CSF of "building the executive group in a specific market" and it could have this every year for different markets.

5. Managerial position (if considered from an individual's point of view). Each of these factors is explained in greater detail below.
Managerial position. This is important if CSF's are considered from an individual's point of view.
For example, manufacturing managers who would typically have the following CSF's: product quality, inventory control and cash control.
In organizations with departments focused on customer relationships, a CSF for managers in these departments may be customer relationship management.
Critical success factors are those factors necessary for an organization to achieve business success. The factors may vary from business to business, but they must be addressed in order to ensure that the business operates at optimal efficiency. There are at least seven critical success factors that should be addressed during the life of the business: revenue, customer service, quality, innovation, communication, flexibility, and research and development.

Revenue
1. Increasing revenue and profits is vital to a company's survival. One example of a critical success factor is to increase new product revenue by 10%.
Customer Service
2. Without customers a business cannot survive. Work to decrease customer complaints through process improvements.
Quality and Innovation
3. Create quality products using quality materials to ensure that the customer gets the expected product each time. The company must be able to translate an idea into a tangible product or service.
Communication
4. The corporate culture must be one in which employees can openly communicate with management.
Flexibility
5. The company must be able to adjust according to the economic and regulatory environment.
Research & Development
6. Maintain an active research area to understand new discoveries in the industry. Keep development alive, ready to create new products and services for potential and existing customers.

References:

http://en.wikipedia.org/wiki/Critical_success_factor

http://www.rapidbi.com/created/criticalsuccessfactors.html

http://www.ehow.com/facts_5270650_critical-success-factors.html?ref=fuel&utm_source=yahoo&utm_medium=ssp&utm_campaign=yssp_art

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http://neilreyniere.blogspot.com/
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PostSubject: Identify and discuss the steps for "critical success factors" approach?   Thu Dec 17, 2009 2:22 am

Identify and discuss the steps for "critical success factors" approach?

Critical Success Factors of Knowledge Management

Released September 2002 By Farida Hasanali Using the lessons learned from early adopters, many organizations have effectively provided their employees with the tools they need for managing and sharing knowledge. Yet, it is easy to forget to account for certain critical elements that enable knowledge sharing.
An elementary success factor of knowledge management (KM) is to have a common understanding of the terms "knowledge management" and "knowledge sharing" and how they apply to your situation and needs. Some organizations choose not to use these terms at all because they are not accepted within the culture. By recognizing this fact, an organization is actually adhering to a critical success factor of KM: listen to your employees and customers.
The definition of KM has evolved quite a bit since the mid 1990s. It started simply as valuable information in action, in which value is determined by the organization and the recipient. Although this definition still holds true today, KM has evolved into a more rigorous discipline that is subject to the same scrutiny as other business processes within an organization and is expected to show a return on investment (ROI).
APQC defines KM as an emerging set of strategies and approaches to create, safeguard, and use knowledge assets (including people and information), which allows knowledge to flow to the right people at the right time so they can apply these assets to create more value for the enterprise.
Some inherent critical success factors are built into the definition. KM is a set of strategies and approaches, which denotes a definite structure or a way to do things. Another critical piece of this definition is that this approach enables the flow of information to the right person at the right time; otherwise, an organization would be managing its knowledge just for the sake of managing it and not to create value. That brings us to the most critical aspect of this definition: creating more value for the enterprise. The most elaborate knowledge-sharing procedures will not help if the knowledge shared within an organization does not enable its recipient(s) to create value, be it through increased revenue or time or cost savings.
The success of a KM initiative depends on many factors, some within our control, some not. Typically, critical success factors can be categorized into five primary categories:
1. leadership;
2. culture;
3. structure, roles, and responsibilities;
4. information technology infrastructure; and
5. measurement.
Leadership Leadership plays a key role in ensuring success in almost any initiative within an organization. Its impact on KM is even more pronounced because this is a relatively new discipline. Nothing makes greater impact on an organization than when leaders model the behavior they are trying to promote among employees. The CEO at Buckman Laboratories, a chemicals company, champions the cause for KM within the organization and personally reviews submissions to its knowledge bank. When he notices that a particular employee has not had been active within the system, he sends a message that reads: "Dear associate, you haven't been sharing knowledge. How can we help you? All the best, Bob."
Several other best-practice organizations have demonstrated this commitment to KM. At the World Bank, the president's support led to the creation of an infrastructure that promoted and supported the growth of communities of practice (CoPs) not only throughout the organization, but also around the globe. Today,
the World Bank has sustained its KM initiative through its CoPs. Its knowledge managers constantly search for new approaches to knowledge sharing.
Although leadership plays a critical role in the success of the KM initiative, the "culture" factor can be even more important to the success of KM.
Culture Culture is the combination of shared history, expectations, unwritten rules, and social customs that compel behaviors. It is the set of underlying beliefs that, while rarely exactly articulated, are always there to influence the perception of actions and communications of all employees.
Cultural issues concerning KM initiatives usually arise due to the following factors:
• Lack of time - The goal is not to encourage the employees to work more, but to work more effectively. The processes, technologies, and roles designed during a KM initiative must save employees' time, not burden them with more work. This can only be accomplished if the employees' work patterns are accounted for during the initial design and planning phase of the initiative.
• Unconnected reward systems - Organizations have to maintain a balance between intrinsic and explicit rewards in order to encourage employee behavior. The most effective use of explicit rewards has been to encourage sharing at the onset of a KM initiative. If the attendees don't find value in either the meetings or the information on the system, providing incentives will not sustain their participation. People share because they want to, they like to see their expertise being used, and they like being respected by their peers.
• Lack of common perspectives - Sharing must be inspired by a common vision. The people affected by the new process or technology must all buy in to this vision and believe it will work.
• No formal communication - When designing and implementing KM initiatives, ensure that employees and customers know about the changes occurring in your organization. It has been hypothesized that a person needs to hear the same message at least three times before it registers in the brain. Hence, communication should be pervasive and ingeminating. While implementing KM within your organization, market yourself. Make sure everyone knows what you are attempting to do, and build anticipation for the launch.
If your organization naturally has a tendency to share knowledge, enabling knowledge sharing becomes a little easier. If your organization harbors a knowledge-hoarding culture, don't give in to it. Remove negative consequences to sharing. People want to share their knowledge. They want others to know they are knowledgeable. Break down some of the existing barriers to knowledge sharing, and give people the tools and environment they need. By designing KM initiatives around your culture, you will be initiating a cultural change.
Structure, Roles, and Responsibilities
Although there are many ways that organizations structure the governance of their KM initiatives, APQC has found common elements among best-practice partner organizations: a steering committee, a central KM support group, and stewards/owners throughout the organization who are responsible for KM. It is a combination of a centralized and decentralized approach.
The steering committee usually consists of executives at the top level. They promote the concept and provide guidance, direction, and support. The central KM group is typically made up of three to four people who provide the initial support for projects or initiatives, which are usually handed over to the business owners once they are implemented. The central group usually consists of people with advanced project management, facilitation, and communication skills. The stewards, or owners, are responsible for knowledge sharing and acquisition within the business units. Like the core KM group, the stewards are change agents for the organization. They model and teach employees the principles of knowledge
sharing using a common vocabulary. All of these participants work as a team to prevent a silo mentality and incorporate resistant employees in the process.
Although the structure is put in place to establish ownership and accountability, if there is no overall ownership of knowledge and learning within the organization and the leadership does not "walk the talk," it will be difficult to sustain any sharing behavior.
Information Technology (IT) Infrastructure
Without a solid IT infrastructure, an organization cannot enable its employees to share information on a large scale. Yet the trap that most organizations fall into is not a lack of IT, but rather too much focus on IT. A KM initiative is not a software application; having a platform to share information and to communicate is only part of a KM initiative. Following are some KM success factors related to IT.
• Approach - The people who are charged with implementing KM must take the time to understand their users' needs. Matching the KM system with the KM objectives is essential.
• Content - With a similar focus on users' needs, establishing great content involves having processes in place to acquire, manage, validate, and deliver relevant information, when and where it is needed.
• Common platforms - A standard companywide architecture ensures the sustainability and scalability of KM efforts. By understanding the organization's infrastructure at a high level, the steering committee can guide the KM team in picking the appropriate technology. Sometimes organizations realize that they need a complete overhaul of their IT infrastructure before they can expect their employees to share knowledge. Many organizations have eliminated or are in the process of phasing out customized legacy systems and replacing them with market-standard operating systems. This enables organizations to build on the existing architecture by using off-the-shelf software that was written to support these platforms, thus avoiding costly customized packages.
• Simple technology - If it takes more than three clicks to find knowledge on your system, users will get frustrated. Of course, you have to temper that with the amount of information being delivered and the complexity of information demanded by the user. Another common mistake made in information delivery is the emphasis on explicit knowledge. Although technology is primarily used to deliver explicit knowledge, placing too much emphasis on it causes the user to lose the context in which the information was shared and leads to misunderstanding on how to interpret the knowledge.
• Adequate training - KM is enabled by adequate technology and people who know how to use it. Best-practice examples reveal that the central KM group should spend most of its time (after deployment) teaching, guiding, and coaching users how to use the system to interact, communicate, and share information and knowledge with one another.
Measurement
Most people fear measurement because they see it as synonymous with ROI, and they are not sure how to link KM efforts to ROI. Although the ultimate goal of measuring the effectiveness of a KM initiative is to determine some type of ROI, there are many intervening variables that also affect the outcomes.
Because many variables may affect an outcome, it is important to correlate KM activities with business outcomes, while not claiming a pure cause-and-effect relationship. Increased sales may be a result not only of the sales representatives having more information, but also of the market turning, a competitor closing down, or prices dropping 10 percent. Due to the inability to completely isolate knowledge-sharing results, tracking the correlations over time is important.
There is a final imperative concerning critical success factors, which transcends KM and applies to all interactions: Listen! Listen to your users, customers, and managers-whichever audience for which you are designing. They will tell you how you can meet their needs and have a successful KM initiative.

It requires a large amount of critical thinking and serious consideration. A very good advantage of this approach that I can clearly see is that it helps you focus your efforts on the most important things. However, you have to identify correctly the CSF’s of your organization because if you identify wrongly, then you would be focusing your efforts on the wrong factors and thus cannot achieve what you are aiming for. This approach may also seem subjective but in a way it is good because the people doing this will have to have a deep and clear understanding of what their organization needs and aims for. If done carefully and critically, the Critical Success Factor approach will be able to help an organization reach its success.
Resources:
http://www.wikipedia.org
Critical Success Factors of Knowledge ManagementReleased September 2002 By Farida Hasanali

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PostSubject: Re: Assignment 6 (Due: December 30, 2009, before 01:00pm)   Thu Dec 17, 2009 8:55 am

Critical success factors can be defined as those issues which are deemed important to the organization, with regard to its present and future performance, and also to its stakeholders. These few key factors are unique for achievement of its vision and might be specific to the industry in which it operates. Critical success factors define few areas of performance that are essential for the organization to accomplish its mission.

In other words these are the factors that are critical to the success of the organization and positive results with respect to these factors are absolutely necessary for an organization to achieve its vision, remain competitive and succeed in the industry.

The business environment is changing dramatically and in order to stay competitive in the market, organizations must improve their business practices and procedures. Organizations within all departments and functions upgrade their capability to generate and communicate accurate and timely information. The organizations which have successfully implemented the ERP systems are reaping the benefits of having integrating working environment, standardized process and operational benefits to the organization. Not all ERP implementations have been successful.

CONCEPTUAL DOMIANS OF CSFS FOR ERP IMPLEMENTATION
Since the model constructs are latent variables, which cannot be measured directly, multi-item scales, each composed of a set of individual items, were needed to obtain indirect measures of each construct. The items listed in this section represent the scales as drawn from the practitioners, and refined through an expert judge-based manual sorting process . These scales were further refined (and some items were dropped) as a result of an empirical test of a survey instrument containing these initial scales.

Critical success factors (CSF) are widely used in the information systems arena . CSFs can be understood as the few key areas where things must go right for the implementation to be successful. Past studies have identified a variety of CSFs for ERP implementation, among which context related factors consistently appear. Following are the commonly identified CSFs identified by several researchers and are pertinent for the success of ERP implementation project.

3.1 Project Management
Project Management involves the use of skills and knowledge in coordinating the scheduling and monitoring of defined activities to ensure that the stated objectives of implementation projects are achieved. The formal project implementation plan defines project activities, commits personnel to those activities, and promotes organizational support by organizing the implementation process.

3.2 Business Process Reengineering
Another important factor that is critical for the success of ERP implementation is the Business Process Reengineering. It is defined by as“the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service and speed”. Organizations should be willing to change their businesses to fit the ERP software in order to minimize the degree of customization needed. The implementation of ERP requires examination of many business processes, which believed to be one of the important and beneficial results of the implementation of ERP system.

3.3 User training and education
In ERP implementation process many projects fail in the end due to lack of proper training. Many researchers consider users training and education to be an important factor of the successful ERP implementation. The main reason for education and training program for ERP implementation is to make the user comfortable with the system and increase the expertise and knowledge level of the people. ERP related concept, features of ERP system, and hands on training are all important dimensions of training program for ERP implementation. Training is not only using the new system, but also in new processes and in understanding the integration within the system – how the work of one employee influences the work of others.

3.4 Technological infrastructure
It argued that adequate IT infrastructure, hardware and networking are crucial for an ERP system’s success. It is clear that ERP implementation involves a complex transition from legacy information systems and business processes to an integrated IT infra-structure and common business process throughout the organization. Hardware selection is driven by the firm’s choice of an ERP software package. The ERP software vendor generally certifies which hardware (and hardware configurations) must be used to run the ERP system. This factor has been considered critical by the practitioners and as well as by the researchers.

3.5 Change management
Change management is a primary concern of many organizations involved in ERP project implementation. Many ERP implementations fail to achieve expected benefits, possibly because companies underestimate the efforts involved in change management. Identify organizational change is the body of knowledge that is used to ensure that a complex change, like that associated with a new big information system, gets the right results, in the right timeframe, at the right costs. Generally, one of the main obstacles facing ERP implementation is resistance to change. It points out that the resistance to change is one of the main hurdles faced by most companies. Resistance can be destructive since it can create conflicts between actors, it can be very time consuming. To implement an ERP systems successfully, the way organizations do business will need to change and ways people do their jobs will need to change as well [12].[13] propose the recurring improvisational change methodology as a useful technique for identifying, managing, and tracking changes in implementing an ERP system. Change Management is important and one of the critical success factors identified in the literature. It is imperative for success of implementation project starting at the initial phase and continuing throughout the entire life cycle.

3.6 Management of Risk
Every Information technology implementation project carries important elements of risk; hence it is probable that progress will deviate from the plan at some point in the project life cycle. ERP implementation project risks are described as uncertainties, liabilities or vulnerabilities that may cause the project to deviate from the defined plan. Risk management is the competence to handle unexpected crises and deviation from the plan [14]. The implementation of ERP system project is characterized as complex activity and involves a possibility of occurrence of unexpected events. Therefore, risk management is to minimize the impact of unplanned incidents in the project by identifying and addressing potential risks before significant consequences occur. It is understood that the risk of project failure is substantially reduced if the appropriate risk management strategy is followed.

3.7 Top Management Support
Top management support has been consistently identified as the most important and crucial success factor in ERP system implementation projects. It defines top management to provide the necessary resources and authority or power for project success. Top management support in ERP implementation has two main facets: (1) providing leadership; and (2) providing the necessary resources. To implement ERP system successfully, management should monitor the implementation progress and provide clear direction of the project. They must be willing to allow for a mindset change by accepting that a lot of learning has to be done at all levels, including themselves.

3.8 Effective Communication
Communication is one of most challenging and difficult tasks in any ERP implementation project. It is considered a critical success factors for the implementation of ERP systems by many authors. It is essential for creating an understanding, an approval of the implementation and sharing information between the project team and communicating to the whole organization the results and the goals in each implementation stage. In addition to gaining approval and user acceptance, the communication will allow the implementation to initiate the necessary final acceptance. The communication should start early in the ERP implementation project and can include overview of the system and the reason for implementing it be consistent and continuous.

3.9 Team work and composition
ERP team work and composition is important throughout the ERP implementation project. An ERP project involves all of the functional departments and demands the effort and cooperation of technical and business experts as well as end-users. According to a survey conducted by [6], ERP implementation team comprises of, functional personnel and management, IT personnel and management, top management, IT consultants, ERP vendor , parent company employees, management consultants, hardware vendor.

The ERP team should be balanced, or cross functional and comprise a mix of external consultants and internal staff so the internal staff can develop the necessary technical skills for design and ERP implementation. According to survey, having competent members in the project team is the fourth most important success factor for IS implementation. Further, the members of the project team(s) must be empowered to make quick decisions.

Reference:
http://www.it-innovations.ae/iit005/proceedings/articles/F_4_IIT05_Bhatti.pdf


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PostSubject: Re: Assignment 6 (Due: December 30, 2009, before 01:00pm)   Thu Dec 17, 2009 9:11 am

Identify and discuss the steps for "critical success factors" approach? (at least 1,500 words)

So many important matters can compete for your attention in business that it's often difficult to see the "wood for the trees". What's more, it can be extremely difficult to get everyone in the team pulling in the same direction and focusing on the true essentials.

That's where Critical Success Factors (CSFs) can help. CSFs are the essential areas of activity that must be performed well if you are to achieve the mission, objectives or goals for your business or project.

By identifying your Critical Success Factors, you can create a common point of reference to help you direct and measure the success of your business or project.

As a common point of reference, CSFs help everyone in the team to know exactly what's most important. And this helps people perform their own work in the right context and so pull together towards the same overall aims.

The idea of CSFs was first presented by D. Ronald Daniel in the 1960s. It was then built on and popularized a decade later by John F. Rockart, of MIT's Sloan School of Management, and has since been used extensively to help businesses implement their strategies and projects.

Inevitably, the CSF concept has evolved, and you may have seen it implemented in different ways. This article provides a simple definition and approach based on Rockart's original ideas.
Rockart defined CSFs as:

"The limited number of areas in which results, if they are satisfactory, will ensure successful competitive performance for the organization. They are the few key areas where things must go right for the business to flourish. If results in these areas are not adequate, the organization's efforts for the period will be less than desired."

He also concluded that CSFs are "areas of activity that should receive constant and careful attention from management."

Critical Success Factors are strongly related to the mission and strategic goals of your business or project. Whereas the mission and goals focus on the aims and what is to be achieved, Critical Success Factors focus on the most important areas and get to the very heart of both what is to be achieved and how you will achieve it.

CSFs are best understood by example. Consider a produce store "Farm Fresh Produce", whose mission is:

"To become the number one produce store in Main Street by selling the highest quality, freshest farm produce, from farm to customer in under 24 hours on 75% of our range and with 98% customer satisfaction."

The strategic objectives of Farm Fresh are to:

• Gain market share locally of 25%.
• Achieve fresh supplies of "farm to customer" in 24 hours for 75% of products.
• Sustain a customer satisfaction rate of 98%.
• Expand product range to attract more customers.
• Have sufficient store space to accommodate the range of products that customers want.

In order to identify possible CSFs, we must examine the mission and objectives and see which areas of the business need attention so that they can be achieved. We can start by brainstorming what the Critical Success Factors might be (these are the "Candidate" CSFs.)

Objective---Candidate Critical Success Factors

Gain market share locally of 25%---Increase competitiveness versus other local stores
---Attract new customers

Achieve fresh supplies from "farm to customer" in 24 hours for 75% of products---Sustain successful relationships with local suppliers

Sustain a customer satisfaction rate of 98%---Retain staff and keep up customer-focused training

Expand product range to attract more customers---Source new products locally

Extend store space to accommodate new products and customers---Secure financing for expansion
---Manage building work and any disruption to the business

Once you have a list of Candidate CSFs, it's time to consider what is absolutely essential and so identify the truly Critical Success Factors.

And this is certainly the case for Farm Fresh Produce. One CSF that we identify from the candidate list is "Sustain successful relationships with local suppliers." This is absolutely essential to ensure freshness and to source new products.

Another CSF is to attract new customers. Without new customers, the store will be unable to expand to increase market share.

A third CSF is financing for expansion. The store's objectives cannot be met without the funds to invest in expanding the store space.

Tip: How Many CSFs?

Whilst there is no hard and fast rule, it's useful to limit the number of CSFs to five or fewer absolute essentials. This helps you maintain the impact of your CSFs, and so give good direction and prioritization to other elements of your business or project strategy.

In reality, identifying your CSFs is a very iterative process. Your mission, strategic goals and CSFs are intrinsically linked and each will be refined as you develop them.

Here are the summary steps that, used iteratively, will help you identify the CSFs for your business or project:

Step One: Establish your business's or project's mission and strategic goals (click here for help doing this.)

Step Two: For each strategic goal, ask yourself "what area of business or project activity is essential to achieve this goal?" The answers to the question are your candidate CSFs.

Tip: How Many CSFs?

To make sure you consider all types of possible CSFs, you can use Rockart's CSF types as a checklist.

• Industry - these factors result from specific industry characteristics. These are the things that the organization must do to remain competitive.
• Environmental - these factors result from macro-environmental influences on an organization. Things like the business climate, the economy, competitors, and technological advancements are included in this category.
• Strategic - these factors result from the specific competitive strategy chosen by the organization. The way in which the company chooses to position themselves, market themselves, whether they are high volume low cost or low volume high cost producers, etc.

Temporal - these factors result from the organization's internal forces. Specific barriers, challenges, directions, and influences will determine these CSFs. Step Three: Evaluate the list of candidate CSFs to find the absolute essential elements for achieving success - these are your Criticial Success Factors.

As you identify and evaluate candidate CSFs, you may uncover some new strategic objectives or more detailed objectives. So you may need to define your mission, objectives and CSFs iteratively.

Step Four: Identify how you will monitor and measure each of the CSFs.

Step Five: Communicate your CSFs along with the other important elements of your business or project's strategy.

Step Six: Keep monitoring and reevaluating your CSFs to ensure you keep moving towards your aims. Indeed, whilst CSFs are sometimes less tangible than measurable goals, it is useful to identify as specifically as possible how you can measure or monitor each one.

Critical Success Factors are the areas of your business or project that are absolutely essential to its success. By identifying and communicating these CSFs, you can help ensure your business or project is well-focused and avoid wasting effort and resources on less important areas. By making CSFs explicit, and communicating them with everyone involved, you can help keep the business and project on track towards common aims and goals.

http://www.mindtools.com/pages/article/newLDR_80.htm

My Blog: http://etelur.blogspot.com/2009/12/mis2-assignment-6.html



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Gabrielle Anne Rae Deseo



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PostSubject: Re: Assignment 6 (Due: December 30, 2009, before 01:00pm)   Sun Dec 20, 2009 2:16 pm

Critical Success Factor

This assignment is for me to identify and discuss the steps for critical success factors. According to Wikipedia and other sources, the following sre the definition of CSF.

Critical Success Factor (CSF) is the term for an element that is necessary for an organization or project to achieve its mission. It is a critical factor or activity required for ensuring the success of your business. The term was initially used in the world of data analysis, and business analysis. For example, a CSF for a successful Information Technology (IT) project is user involvement.
http://en.wikipedia.org/wiki/Critical_success_factor

Critical Success Factors have been used significantly to present or identify a few key factors that organizations should focus on to be successful.
As a definition, critical success factors refer to "the limited number of areas in which satisfactory results will ensure successful competitive performance for the individual, department, or organization”.
http://rapidbi.com/created/criticalsuccessfactors.html#WhatareCSFs

The idea of identifying critical success factors as a basis for determining the information needs of managers was proposed by Daniel (1961) but popularized by Rockart (1979). The idea is very simple: in any organization certain factors will be critical to the success of that organization, in the sense that, if objectives associated with the factors are not achieved, the organization will fail - perhaps catastrophically so. Rockart (1979: 85), by referring to Daniel (1961), gives the following as an example of the CSFs: new product development, good distribution, and effective advertising for the food processing industry - factors that remain relevant today for many firms. The CSFs approach was applied in case studies carried out in the UK universities. It was applied also as a component of a strategic information management (SIM) methodology put forward by Wilson (1992, 1994b). The CSFs approach was combined with the value chain concept by Porter (1985) in order to form an information audit. The methodology was tested in two case studies carried out in very knowledge-intensive sectors of Finnish industry. The process was funded by the Academy of Finland.
http://informationr.net/ir/6-3/paper108.html

Types of Critical Success Factor


There are four basic types of CSF's
They are:
1. Industry CSF's resulting from specific industry characteristics;
2. Strategy CSF's resulting from the chosen competitive strategy of the business;
3. Environmental CSF's resulting from economic or technological changes; and
4. Temporal CSF's resulting from internal organizational needs and changes.

Things that are measured get done more often than things that are not measured.
Each CSF should be measurable and associated with a target goal. You don't need exact measures to manage. Primary measures that should be listed include critical success levels (such as number of transactions per month) or, in cases where specific measurements are more difficult, general goals should be specified (such as moving up in an industry customer service survey).

Definitions

Critical Success Factor
an element of organizational activity which is central to its future success. Critical success factors may change over time, and may include items such as product quality, employee attitudes, manufacturing flexibility, and brand awareness. This can enable analysis.

Critical Success Factor
any of the aspects of a business that are identified as vital for successful targets to be reached and maintained. Critical success factors are normally identified in such areas as production processes, employee and organization skills, functions, techniques, and technologies. The identification and strengthening of such factors may be similar. ..

Critical Success Factor (CSF) or Critical Success Factors
is a business term for an element which is necessary for an organization or project to achieve its mission. For example, a CSF for a successful Information Technology (IT) project is user involvement.
Using the term
The term “Critical Success Factor” is used differently, due to ambiguity of the word “critical”,
back and forth translations into other languages and interpretation when analyzed in portfolios:
1. Definition 1: “critical” = important, key, determining, vital, strategic, etc.
2. Definition 2: “critical” = alarming, anxious, etc. (as shown within the diagram = top left):
Which ever definition you use. make sure that all managers understand the definition.

Five key sources of Critical Success Factors
MAIN ASPECTS OF Critical Success Factors and their use in analysis
CSF's are tailored to a firm's or manager's particular situation as different situations (e.g. industry, division, individual) lead to different critical success factors. Rockart and Bullen presented five key sources of CSF's:

1. The industry,
2. Competitive strategy and industry position,
3. Environmental factors,
4. Temporal factors, and
5. Managerial position (if considered from an individual's point of view). Each of these factors is explained in greater detail below.

In reality, identifying your CSFs is a very iterative process. Your mission, strategic goals and CSFs are intrinsically linked and each will be refined as you develop them.

Here are the summary steps that, used iteratively, will help you identify the CSFs for your business or project:

Step One: Establish your business's or project's mission and strategic goals.
Step Two: For each strategic goal, ask yourself "what area of business or project activity is essential to achieve this goal?" The answers to the question are your candidate CSFs.
Step Three: Evaluate the list of candidate CSFs to find the absolute essential elements for achieving success - these are your Criticial Success Factors.

As you identify and evaluate candidate CSFs, you may uncover some new strategic objectives or more detailed objectives. So you may need to define your mission, objectives and CSFs iteratively.

Step Four: Identify how you will monitor and measure each of the CSFs.

Step Five: Communicate your CSFs along with the other important elements of your business or project's strategy.

Step Six: Keep monitoring and reevaluating your CSFs to ensure you keep moving towards your aims. Indeed, whilst CSFs are sometimes less tangible than measurable goals, it is useful to identify as specifically as possible how you can measure or monitor each one.

Key Points
Critical Success Factors are the areas of your business or project that are absolutely essential to its success. By identifying and communicating these CSFs, you can help ensure your business or project is well-focused and avoid wasting effort and resources on less important areas. By making CSFs explicit, and communicating them with everyone involved, you can help keep the business and project on track towards common aims and goals.

Tip: How Many CSFs?
To make sure you consider all types of possible CSFs, you can use Rockart's CSF types as a checklist.
• Industry - these factors result from specific industry characteristics. These are the things that the organization must do to remain competitive.
• Environmental - these factors result from macro-environmental influences on an organization. Things like the business climate, the economy, competitors, and technological advancements are included in this category.
• Strategic - these factors result from the specific competitive strategy chosen by the organization. The way in which the company chooses to position themselves, market themselves, whether they are high volume low cost or low volume high cost producers, etc.
• Temporal - these factors result from the organization's internal forces. Specific barriers, challenges, directions, and influences will determine these CSFs.
http://rapidbi.com/created/criticalsuccessfactors.html

With the steps discussed above critical success factor are probably essential for every organization. The steps in CFS allow an organization to plan of how to attain success without any problems.


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Norena T. Nicdao



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PostSubject: Re: Assignment 6 (Due: December 30, 2009, before 01:00pm)   Tue Dec 22, 2009 11:35 am

Definition

Critical Success Factors - Focusing attention on the things that are important in the things you do. So many important matters can compete for your attention in business that it's often difficult to see the "wood for the trees". What's more, it can be extremely difficult to get everyone in the team pulling in the same direction and focusing on the true essentials. That's where Critical Success Factors (CSFs) can help. CSFs are the essential areas of activity that must be performed well if you are to achieve the mission, objectives or goals for your business or project. By identifying your Critical Success Factors, you can create a common point of reference to help you direct and measure the success of your business or project.

As a common point of reference, CSFs help everyone in the team to know exactly what's most important. And this helps people perform their own work in the right context and so pull together towards the same overall aims. The idea of CSFs was first presented by D. Ronald Daniel in the 1960s. It was then built on and popularized a decade later by John F. Rockart, of MIT's Sloan School of Management, and has since been used extensively to help businesses implement their strategies and projects. Inevitably, the CSF concept has evolved, and you may have seen it implemented in different ways. This article provides a simple definition and approach based on Rockart's original ideas.

Rockart defined CSFs as:

"The limited number of areas in which results, if they are satisfactory, will ensure successful competitive performance for the organization. They are the few key areas where things must go right for the business to flourish. If results in these areas are not adequate, the organization's efforts for the period will be less than desired."

He also concluded that CSFs are "areas of activity that should receive constant and careful attention from management."

Critical Success Factors are strongly related to the mission and strategic goals of your business or project. Whereas the mission and goals focus on the aims and what is to be achieved, Critical Success Factors focus on the most important areas and get to the very heart of both what is to be achieved and how you will achieve it.

An Example:

CSFs are best understood by example. Consider a produce store "Farm Fresh Produce", whose mission is:

"To become the number one produce store in Main Street by selling the highest quality, freshest farm produce, from farm to customer in under 24 hours on 75% of our range and with 98% customer satisfaction."

Summary Steps:

In reality, identifying your CSFs is a very iterative process. Your mission, strategic goals and CSFs are intrinsically linked and each will be refined as you develop them.

Here are the summary steps that, used iteratively, will help you identify the CSFs for your business or project:

Step One: Establish your businesses or project's mission and strategic goals (click here for help doing this.)

Step Two: For each strategic goal, ask yourself "what area of business or project activity is essential to achieve this goal?" The answers to the question are your candidate CSFs.

Step Three: Evaluate the list of candidate CSFs to find the absolute essential elements for achieving success - these are your Criticial Success Factors.

As you identify and evaluate candidate CSFs, you may uncover some new strategic objectives or more detailed objectives. So you may need to define your mission, objectives and CSFs iteratively.

Step Four: Identify how you will monitor and measure each of the CSFs.

Step Five: Communicate your CSFs along with the other important elements of your business or project's strategy.

Step Six: Keep monitoring and reevaluating your CSFs to ensure you keep moving towards your aims. Indeed, whilst CSFs are sometimes less tangible than measurable goals, it is useful to identify as specifically as possible how you can measure or monitor each one.

Critical Success Factor Method: Establishing a Foundation for Enterprise Security Management

Every organization has a mission that describes why it exists (its purpose) and where it intends to go (its direction). The mission reflects the organization's unique values and vision. Achieving the mission takes the participation and skill of the entire organization. The goals and objectives of every staff member must be aimed toward the mission. However, achieving goals and objectives is not enough. The organization must perform well in key areas on a consistent basis to achieve the mission. These key areas—unique to the organization and the industry in which it competes—can be defined as the organization's critical success factors.

The critical success factor method is a means for identifying these important elements of success. It was originally developed to align information technology planning with the strategic direction of an organization. However, in research and fieldwork undertaken by members of the Survivable Enterprise Management (SEM) team at the Software Engineering Institute, it has shown promise in helping organizations guide, direct, and prioritize their activities for developing security strategies and managing security across their enterprises. This report describes the critical success factor method and presents the SEM team's theories and experience in applying it to enterprise security management.

Understanding Critical Success Factor Analysis
Overview of CSF Analysis
CSF analysis is:
• A method developed at MIT’s Sloan school by John Rockart to guide businesses in creating and measuring success
• Widely used for technology and architectural planning in enterprise I/T
• A top-down methodology that is especially suitable for designing systems as opposed to applications
• A reductionist method for going from an abstract vision to concrete requirements
What Is a Critical Success Factor?
• A key area where satisfactory performance is required for the organization to achieve its goals
• A means of identifying the tasks and requirements needed for success
• At the lowest level, CSFs become concrete requirements
• A means to prioritize requirements
The CSF Method
• Start with a vision: mission statement
• Develop 5-6 high level goals
• Develop hierarchy of goals and their success factors
o Leads to concrete requirements at the lowest level of decomposition (a single, implementable idea)
o Along the way, identify the problems being solved and the assumptions being made
• Cross-reference usage scenarios and problems with requirements
Results of the Analysis
• Mission statement
• Hierarchy of goals and CSFs
• Lists of requirements, problems, and assumptions
• Analysis matrices
o Problems vs. Requirements matrix
o Usage scenarios vs. Requirements matrix
• Solid usage scenarios
Relationship to Usage Scenarios
• Usage scenarios or “use cases” provide a means of determining:
o Are the requirements aligned and self-consistent?
o Are the needs of the user being met as well as those of the enterprise?
o Are the requirements complete?
CSF analysis:
• Produces results that express the needs of the enterprise clearly and (hopefully) completely
• Allows us to measure success and prioritize goals in a sensible way
• When used together with traditional usage scenarios, ensures that the needs of both the user and the enterprise are being met


Reference:

http://www.mindtools.com/pages/article/newLDR_80.htm
http://www.sei.cmu.edu/library/abstracts/reports/04tr010.cfm
www.w3.org/2002/ws/arch/2/04/UCSFA.ppt
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Sheila Capacillo



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PostSubject: Assignment 6   Tue Dec 22, 2009 9:25 pm

Identify and discuss the steps for "critical success factors" approach?

Critical Success Factor (CSF) is the term for an element that is necessary for an organization or project to achieve its mission. It is a critical factor or activity required for ensuring the success of your business. The term was initially used in the world of data analysis, and business analysis. For example, a CSF for a successful Information Technology (IT) project is user involvement.


A plan should be implemented that considers a platform for growth and profits as well as takes into consideration the following critical success factors:

•Money: positive cash flow, revenue growth, and profit margins.
•Your future: Acquiring new customers and/or distributors.
• Customer satisfaction: How happy they are.
• Quality: How good is your product and service?
• Product or service development: What's new that will increase business with existing customers and attract new ones?
• Intellectual capital: Increasing what you know is profitable.
• Strategic relationships: New sources of business, products and outside revenue.
• Employee attraction and retention: Your ability to extend your reach.
• Sustainability: Your personal ability to keep it all going.

Critical Success Factors (CSF’s) are the critical factors or activities required for ensuring the success your business. The term was initially used in the world of data analysis, and business analysis.

Most smaller and more pragmatic businesses can still use CSF’s but we need to take a different, more pragmatic approach.
Critical Success Factors have been used significantly to present or identify a few key factors that organizations should focus on to be successful.
As a definition, critical success factors refer to "the limited number of areas in which satisfactory results will ensure successful competitive performance for the individual, department, or organization”.

Being Practical

As you read this and many other resources on the internet you will discover that there are potentially a confusing variety of definitions and uses of Critical Success Factors.
Before you start the journey looking at CSFs it is important to realise that the specific factors relevant for you will vary from business to business and industry to industry. The key to using CSFs effectively is to ensure that your definition of a factor of your organizations activity which is central to its future will always apply.
Therefore success in determining the CSFs for your organization is to determine what is central to its future and achievement of that future.
This page is primarily written for students of management and business, to keep things simple for application in smaller organizations remember to only have 5-7 critical factors for YOUR organization, and I am sure one of those will be cashflow!

How are they important to your business?

Identifying CSF's is important as it allows firms to focus their efforts on building their capabilities to meet the CSF's, or even allow firms to decide if they have the capability to build the requirements necessary to meet Critical Success Factors (CSF's).


Types of Critical Success Factor
There are four basic types of CSF's
They are:
1. Industry CSF's resulting from specific industry characteristics;
2. Strategy CSF's resulting from the chosen competitive strategy of the business;
3. Environmental CSF's resulting from economic or technological changes; and
4. Temporal CSF's resulting from internal organizational needs and changes.
Things that are measured get done more often than things that are not measured.
Each CSF should be measurable and associated with a target goal. You don't need exact measures to manage. Primary measures that should be listed include critical success levels (such as number of transactions per month) or, in cases where specific measurements are more difficult, general goals should be specified (such as moving up in an industry customer service survey).


Definitions

Critical Success Factor
an element of organizational activity which is central to its future success. Critical success factors may change over time, and may include items such as product quality, employee attitudes, manufacturing flexibility, and brand awareness. This can enable analysis.

Critical Success Factor
any of the aspects of a business that are identified as vital for successful targets to be reached and maintained. Critical success factors are normally identified in such areas as production processes, employee and organization skills, functions, techniques, and technologies. The identification and strengthening of such factors may be similar. ..

Critical Success Factor (CSF) or Critical Success Factors
is a business term for an element which is necessary for an organization or project to achieve its mission. For example, a CSF for a successful Information Technology (IT) project is user involvement.

Five key sources of Critical Success Factors

MAIN ASPECTS OF Critical Success Factors and their use in analysis
CSF's are tailored to a firm's or manager's particular situation as different situations (e.g. industry, division, individual) lead to different critical success factors. Rockart and Bullen presented five key sources of CSF's:

1.The industry,
Industry: There are some CSF's common to all companies operating within the same industry. Different industries will have unique, industry-specific CSF's
An industry's set of characteristics define its own CSF's Different industries will thus have different CSF's, for example research into the CSF's for the Call centre, manufacturing, retail, business services, health care and education sectors showed each to be different after starting with a hypothesis of all sectors having their CSF's as market orientation, learning orientation, entrepreneurial management style and organizational flexibility.
In reality each organization has its own unique goals so while thee may be some industry standard - not all firms in one industry will have identical CSF's.
Some trade associations offer benchmarking across possible common CSF's.

2.Competitive strategy and industry position,
Competitive position or strategy: The nature of position in the marketplace or the adopted strategy to gain market share gives rise to CSF's Differing strategies and positions have different CSF's
Not all firms in an industry will have the same CSF's in a particular industry. A firm's current position in the industry (where it is relative to other competitors in the industry and also the market leader), its strategy, and its resources and capabilities will define its CSF's
The values of an organization, its target market etc will all impact the CSF's that are appropriate for it at a given point in time.

3. Environmental factors,
Environmental changes: Economic, regulatory, political, and demographic changes create CSF's for an organization.
These relate to environmental factors that are not in the control of the organization but which an organization must consider in developing CSF's Examples for these are the industry regulation, political development and economic performance of a country, and population trends.
An example of environmental factors affecting an organization could be a de-merger

4. Temporal factors
Temporal factors: These relate to short-term situations, often crises. These CSF's may be important, but are usually short-lived.
Temporal factors are temporary or one-off CSF's resulting from a specific event necessitating their inclusion.
Theoretically these would include a firm which "lost executives as a result of a plane crash requiring a critical success factor of rebuilding the executive group".
Practically, with the evolution and integration of markets globally, one could argue that temporal factors are not temporal anymore as they could exist regularly in organizations.
For example, a firm aggressively building its business internationally would have a need for a core group of executives in its new markets. Thus, it would have the CSF of "building the executive group in a specific market" and it could have this every year for different markets.

5. Managerial position (if considered from an individual's point of view). Each of these factors is explained in greater detail below.
Managerial role: An individual role may generate CSF's as performance in a specific manager's area of responsibility may be deemed critical to the success of an organization.
Managerial position. This is important if CSF's are considered from an individual's point of view.
For example, manufacturing managers who would typically have the following CSF's: product quality, inventory control and cash control.
In organizations with departments focused on customer relationships, a CSF for managers in these departments may be customer relationship management.

CSF as a requirement:

After having developed a hierarchy of goals and their success factors, further analysis will lead to concrete requirements at the lowest level of detail

CSF as a key influence factor:
Some CSFs might influence other CSFs or factors such as markets, technologies, etc.
Such CSFs could be rephrased into “key influence factors” For example: “physical size” or “trained staff”


A Critical Success Factor Method

Start with a vision:
• Mission statement
• Develop 5-6 high level goals
• Develop hierarchy of goals and their success factors
• Lists of requirements, problems, and assumptions
• Leads to concrete requirements at the lowest level of decomposition (a single, implementable idea) Along the way, identify the problems being solved and the assumptions being made Cross-reference usage scenarios and problems with requirements
• Analysis matrices
• Problems vs. Requirements matrix
• Usage scenarios vs. Requirements matrix
• Solid usage scenarios
• Relationship to Usage Scenarios
• Usage scenarios or "use cases"; provide a means of determining:
o Are the requirements aligned and self-consistent?
o Are the needs of the user being met as well as those of the enterprise?
o Are the requirements complete
• Results of the Analysis

Using Critical Success Factors for Strategic and Business Planning

Examples of Critical Success factors
Statistical research into CSF’s on organizations has shown there to be seven key areas. These CSF's are:
1. Training and education
2. Quality data and reporting
3. Management commitment, customer satisfaction
4. Staff Orientation
5. Role of the quality department
6. Communication to improve quality, and
7. Continuous improvement
These were identified when Total Quality was at its peak, so as you can see have a bias towards quality matters. You may or may not feel that these are right or indeed critical for your organization.
The Critical Success Factors we have identified and us in the BIR process are captured in the mnemonic PRIMO-F
1. People - availability, skills and attitude
2. Resources - People, equipment, etc
3. Innovation - ideas and development
4. Marketing - supplier relation, customer satisfaction, etc
5. Operations - continuous improvement, quality,
6. Finance- cash flow, available investment etc

References:
http://rapidbi.com/created/criticalsuccessfactors.html

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AlyssaRae Soriano



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PostSubject: Re: Assignment 6 (Due: December 30, 2009, before 01:00pm)   Wed Dec 23, 2009 4:16 am

CSFs (Critical Success Factor) are the essential areas of activity that must be performed well if you are to achieve the mission, objectives or goals for your business or project. By identifying your Critical Success Factors, you can create a common point of reference to help you direct and measure the success of your business or project.

Critical Success Factor is the term for an element that is necessary for an organization or project to achieve its mission. It is a critical factor or activity required for ensuring the success of your business. The term was initially used in the world of data analysis, and business analysis. For example, a CSF for a successful Information Technology (IT) project is user involvement.

A critical success factor is not a key performance indicator (KPI). Critical success factors are elements that are vital for a strategy to be successful. KPIs are measures that quantify management objectives and enable the measurement of strategic performance. A critical success factor is what drives the company forward, it is what makes the company or breaks the company. As staff must ask themselves everyday 'Why would customers choose us?' and they will find the answer is the critical success factors.

As a common point of reference, CSFs help everyone in the team to know exactly what's most important. And this helps people perform their own work in the right context and so pull together towards the same overall aims.

The idea of CSFs was first presented by D. Ronald Daniel in the 1960s. It was then built on and popularized a decade later by John F. Rockart, of MIT's Sloan School of Management, and has since been used extensively to help businesses implement their strategies and projects. Inevitably, the CSF concept has evolved, and you may have seen it implemented in different ways. This article provides a simple definition and approach based on Rockart's original ideas.

Rockart defined CSFs as:
"The limited number of areas in which results, if they are satisfactory, will ensure successful competitive performance for the organization. They are the few key areas where things must go right for the business to flourish. If results in these areas are not adequate, the organization's efforts for the period will be less than desired."

He also concluded that CSFs are "areas of activity that should receive constant and careful attention from management." Critical Success Factors are strongly related to the mission and strategic goals of your business or project. Whereas the mission and goals focus on the aims and what is to be achieved, Critical Success Factors focus on the most important areas and get to the very heart of both what is to be achieved and how you will achieve it.

The CSFs approach was applied in case studies carried out in the UK universities (Pellow & Wilson, 1993; Greene et al. 1996; Loughridge 1996). It was applied also as a component of a strategic information management (SIM) methodology put forward by Wilson (1992, 1994b). The CSFs approach was combined with the value chain concept by Porter (1985) in order to form an information audit (e.g. Ellis et al. 1993; Dimond, 1996; Buchanan & Gibb, 1998; see also Goldsmith, 1991). The methodology was tested in two case studies carried out in very knowledge-intensive sectors of Finnish industry. The process was funded by the Academy of Finland.

CRTICICAL SUCCESS FACTORS for Strategic Planning, Thinking, and Doing
1. Paradigm Shift. Shift your paradigm about organizations to one that is
the largest and most inclusive by beginning with societal good in
mind. Move out of your comfort zone and consider two bottom lines:
• Positive impact on society through improved quality of life.
• Profit over long term.

2. Results vs. Methods and Means. Distinguish between ends and means.
Define and plan results at the Mega, Macro, and Micro levels you
desire before choosing how to achieve them.

3. Link Mega, Macro, and Micro. Use all three levels of planning and
results, Mega, Macro, and Micro.

4. Measurable Objectives. Develop measurable objectives at the Mega,
Macro, and Micro levels of results that are linked systemically as a
value added chain. Don’t include methods and means in objectives.

5. Ideal Vision. Use an Ideal Vision as the foundation for strategic thinking
and planning. Don’t be limited to your immediate organization or
current paradigms.

6. Needs Are Gaps in Results. Define “needs” as a gaps in results, not as
insufficient resources, means, or methods.

These critical success factors are now explained in more detail.

Paradigm Shift. Paradigms, like mental models, are the ways
in which we perceive and filter reality. When the demands and pressures for
change within the organization intensify beyond just incremental changes,
then it’s one indicator that a paradigm shift is imminent.We can and should shift
paradigms, even when previous paradigms are not yet failing us. Thinking
about the future is not about “more of the same.” After all, the ways of thinking
that led to success yesterday can become a major barrier to creating future
success.

Distinguishing between ends and means. Distinguishing between ends and means is another characteristic of a strategic thinker. Results are ends that define in measurable terms the future we want to create. Means are the methods and tactics we choose to
achieve the results. It is also good sense, good logic, and good economics to define
the future desired state before selecting how you will get there. When methods,
means, resources, and tactics are chosen before the problem, opportunity, and result
are defined, then we are likely to end up somewhere other than where we desire.

Link Mega, Macro and Micro. Use and link all three levels of planning and
results. Each level of results focuses on a different, but related, client category.
The starting point for strategic planning—unless you aren’t concerned with the
health, safety, and well-being of your clients and community—is to define the desired results at the Mega level. Planning then proceeds down the chain of results to the Macro and Micro levels. In this way the three levels of results make up a value added chain of high payoff results. After all, we want to plan for useful results before selecting any methods or means for accomplishing those results.

Measurable Objectives. We create the future twice. We achieve it the first
time in our mind through imagining and dreaming, and then again through our
external accomplishments. For any useful results to be accomplished in tangible, measurable forms, first someone has to dream them. Since there are three levels of planning and associated results (Mega/Outcomes, Macro/Outputs, Micro/Products), strategic thinkers develop linked objectives for each of these in measurable terms. To
ensure we move out of our present paradigms and break the status quo, we must
be bold and audacious when we set and commit to our objectives. These objectives are called Smarter objectives. These are objectives that are not based on past processes; they specify the desired future in terms of results that ought to be accomplished, irrespective of the hindrances of today. They invent in the mind’s eye and commit to action results that have not yet been achieved (nor perhaps even conceived). As such, they don’t include methods and means— the methods and means describe the options for achieving the results, not the results themselves.

Ideal Vision. It is critical that strategic thinking and planning begin by stepping outside the limits of your organization. This step involves representative stakeholders in answering some fundamental questions about the sort of world you would like to create for tomorrow’s child. The Ideal Vision expresses in measurable terms what we wish to accomplish and commit to design and create.3 It describes ends and not means, processes, procedures, resources, or methods. In Chapter Four, Preparing to Plan, the Ideal Vision as the starting place for strategic thinking is described in greater detail.

Needs are gaps in results. Define “needs” as a gap between present results and desired results, not as perceived gaps in inputs and/or processes (which are really wants). By defining needs as gaps in results, we are thinking strategically, because we are designing the long-term future to be accomplished before deciding what methods and means might create it. Terminology should be precise when describing the world to which we will expect to commit many resources.

Critical Success Factors are the areas of your business or project that are absolutely essential to its success. By identifying and communicating these CSFs, you can help ensure your business or project is well-focused and avoid wasting effort and resources on less important areas. By making CSFs explicit, and communicating them with everyone involved, you can help keep the business and project on track towards common aims and goals.

LINKS used:

http://en.wikipedia.org/wiki/Critical_success_factor
http://www.mindtools.com/pages/article/newLDR_80.htm
http://media.wiley.com/product_data/excerpt/30/07879650/0787965030.pdf
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Assignment 6 (Due: December 30, 2009, before 01:00pm)

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