Business Success Factors

Every business has a number of key success factors that measure and determine its success or failure.

Critical success factors in a business are like the vital functions of the body, such as heart rate, respiratory rate, blood pressure, brain-wave activity, and so on. These vital functions are all indicators and measures of the overall health and vitality of an individual. The absence of any one of them, even for a few moments, can lead to the death of the individual.

Companies have critical success factors, as well, which measure the health and vitality of an enterprise. Many of these are common to all businesses. In addition, some companies will have critical success factors that are unique to that organisation.

The most common critical success factors in a business are leadership, product quality, service, sales, marketing, manufacturing, and finance, and cash flow. Excellence performance is necessary in every one of these areas for a company to enjoy excellent results. Poor performance, or non-performance, in any one of these areas can threaten the survival of a business.

For example, according to the Australian Graduate School of Management, the majority of business failures in Australia are triggered by a drop off in sales and revenue. Whatever the causes of low sales, any prolonged weakness in this area can lead to the collapse of the enterprise. This, then, is a critical success factor, or a vital function of a business.

Start Where You Are

Each individual has personal critical success factors, the performance of which determines his or her business future.

You have a set of key skills or core competencies that you use, like tools, to do your job. A weakness or failure in any one of your key skills can undermine your overall effectiveness and weaken your ability to do your job effectively. To perform at your best, you must first identify the critical success factors of your work, measure your strengths in each one and then develop a plan to become excellent in the areas that can help you the most.

For example, problem-solving and decision making are critical success factors for every person in business. These are core competencies that are central to all business activities. If a person is experiencing challenges in his or her life, that person may not be capable of solving problems intelligently or making good decisions. Everyone who then depends upon that person to think and decide effectively is at risk. An entire department can be negatively impacted because of a weakness in one critical success factor in a key person.

Within each key performance area, there are also critical success factors. For example, in selling, a weakness in a single one of the critical success factors (seven in total) can reduce a salesperson’s effectiveness, causing that person to sell only a small part of what he or she is capable of selling. In many companies, the sales force is poorly trained or not trained at all. The members of senior management cannot figure out why they are not getting the kind of sales that they want to expect. Sometimes, by focusing in on a particular critical success factor, sales training can double or even triple the sales of a business.

Ask A Better Question

To determine your personal critical success factors, ask yourself two questions. The first question is, Why am I on the payroll? What exactly, have you been hired to accomplish? Why does the company pay you the money it does? Both you and your boss should be in complete agreement on this question. Whatever your answer is on this question, that is what you should be working on most of the time.

The second question is, What can I, and only I, do that if done will make a real difference to my company? In other words, if you don’t do it, it won’t get done. But if you do do it, and do it well, it can make a tremendous difference both to your company and to your self.

Both these questions should be asked of every single person in the company on a regular basis. Everyone should be absolutely clear about the answers. This is one way to assure that each person is focusing his or her best efforts in the areas of personal critical success factors.

Your Weakest Link

Your personal strengths and core competencies are what have brought you to where you are today. They are the foundations of your position and the determinants of your income. At the same time, your weaknesses form the ceiling on your ability to rise to even greater heights. Your weakest critical success factor sets the limit on how far and how fast you can go. It acts like a brake on your potential.

To move ahead more rapidly, you must be brutally honest with yourself in seeking out and facing your areas of weakness. What are they? What one skill if you developed it and did it in an excellent fashion, will have the greatest positive impact on your career? Whatever the answer to this question, this is where you should begin to work on yourself.