What are the steps involved in using the Critical Success Factors? Before I discuss the steps I think I’ll first define what CSF is and what it is for.

As what I have read, 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. In short Critical Success Factors are key factors to the success of a project, organization, or an industry.
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. 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. 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. It is also said that the method of Critical Success Factors is an iterative one, meaning that even though missions, goals and objectives are already established it doesn’t mean it’s final. Sometimes after CSFs are identified, mission and objectives are modified because of newly found strategic goals and objectives.

These are the steps followed in order to create a Critical Success Factor analysis:
Step One: Establish your business' or project's mission and strategic goals. By defining first the mission the goals and objectives can be narrowed down in order to pinpoint the candidates for CSF. 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. So in order to identify areas that need focus a solid aim should be first established. The foundation for writing good CSFs is a good understanding of the environment, the industry and the organization. To do this it requires the use of information that is readily available in the public domain. Industry information can be source from industry associations, news articles, trade associations, prospectuses of competitors, and equity/analysis reports to name some sources. This is helpful in building knowledge of the environment, the industry and competitors. The information mentioned above can easily and largely accessed through the internet. Some sources that helps in gathering information is not necessarily accessible through the internet, are interviews with the buyers or customers and suppliers, industry analysts or experts and independent observers.

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. In finding suitable candidates for CSF, here are some tips in what factors should be considered in for selecting essential strategic goals for different types of CSF:

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.

After having developed a hierarchy of goals and their success factors, further analysis will lead to concrete requirements at the lowest level of detail. A “good” CSF begins with an action verb and clearly and concisely conveys what is important and should attended to. Verbs that characterize actions: attract, perform, expand, monitor, manage, deploy, etc.

Step Three: Evaluate the list of candidate CSFs to find the absolute essential elements for achieving success - these are your Critical Success Factors. Evaluation of the list of candidates is important so that the more important areas or factors are left and be identified as Critical 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. It is important to identify ways of monitoring and measuring CSFs so as to prove that the identified CSFs are indeed factors of success to the organization. By identifying these CSFs, these helps ensure that the business or project is well-focused and avoid wasting effort and resources on less important areas.

Step Five: Communicate your CSFs along with the other important elements of your business or project's strategy. By making CSFs unambiguous, and communicating them with everyone involved, this can help keep the business and project on track towards common aims and goals.

Step Six: Keep monitoring and reevaluating your CSFs to ensure you keep moving towards your aims. Indeed, while 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. This is what I meant about how this approach is iterative. After having the CSFs it is of utmost important to monitor what happens to the organization after the CSFs were established. Whether the objectives were met or not, or there is a need to change or even have new CSFs.
Here are some tips on who to write a good Critical Success Factor:
Ensure a good understanding of the environment, the industry and the company – It is stated that CSF's have five primary sources presented by Rockart and Bullen, namely the Industry, Competitive strategy and industry position, Environmental factors, Temporal factors, and Managerial position. 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 modified for companies and individuals and the customization is a result from the uniqueness of the organization.
Build knowledge of competitors in the industry – While this principle is covered in the previous one, it is worth highlighting separately because 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 movement for the development of CSF's was the idea 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 imitate 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, careful process is 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 performance.

References:
http://www.rapidbi.com/created/criticalsuccessfactors.html
http://www.mindtools.com/pages/article/newLDR_80.htm

hehe.. its been a while.. might as well start off with a greeting! Hello everyone! I know my blog is not popular but still people read my posts so i think i should be updating this more frequently. I haven't posted til now for some reasons, not excuses. reasons. Well to be honest im not really into blogging before.. but now due to my obligation as a student (hehe) and the persistency of some of my friends i took interest in blogging. Reading blogs is fun but writing my own entries is somewhat hard. My english is bad, my humor is evil and my thoughts are dirty (haha). Well anyway this is the start of my blogging career! hope ya'll like my future entries.

See ya!