Key success factors (KSFs), or critical success factors, are those areas, processes or activities that organizations must focus on in order to achieve success. They allow a firm to focus on meeting its desired objectives, which are critical to its success. Examples of KSFs are employee attitudes, product quality, brand awareness, technological advancements and manufacturing flexibility.
Industry KSFs are universal to all organizations working within the same industry and different within organizations working in dissimilar industries. For instance, industry KSFs of two companies working in the airlines industry will be the same, while those of a company working in the agricultural industry will be different from the KSFs of a health care organization. Industry KSFs highlight the differences between profit and loss, and organizational success and failure. They include all those activities or services a firm must provide to satisfy its customers, its competitive capability or a specific talent or skill.
Strategy KSFs are derived from a firm's chosen strategy. A strategy is a systematic long-term action plan designed to realize a particular goal. Strategy KSFs are different for different companies, even if they are working in the same industry. These KSFs are typically formulated after incorporating an external and internal analysis of all business factors and marketing research. They will depend on a company’s current resources, industry ranking and organizational values. Examples of strategic KSFs are ways to attract new customers, increasing profit margin and revenue and identifying new business activities.
Environmental KSFs are identified when an organization undergoes changes due to technological process or external economic conditions. They take into consideration all external factors that lie outside the scope of control of an organization. These include economic crisis, regulatory changes, taxes, political developments and other changes. Environmental KSFs align an organization's goals and success factors with the external environmental and economic conditions.
Temporal KSFs are contingency plans for all unexpected interorganizational changes. They are designed and put into action in times of crisis situations, loss of key personnel or upper management or natural disasters. Temporal KSFs are important if a company is planning to expand or enter into new, unknown markets or product design activities.
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