In today’s blog post, I will share another great business tools, the Critical Success Factors (CSFs). 

What are Critical Success Factors?

These are factors that will determine your companies success or failure. For example, sometimes it can be hard to get everyone in your team to focus on what really matters. That’s where Critical Success Factors can help. 

I will show you how you can identify your CSFs, how they relate to your business objectives, and how they differ from Key Performance Indicators (KPIs).


  • ⇒ What are Critical Success Factors?
  • ⇒ How can CSFs help you?
  • ⇒ Who created this tool?
  • What are the four types of CSFs?
  • What is the difference between CSFs, KPIs and Strategic Goals?
  • What are the six steps to identify and develop your CSFs?
  • ⇒ Summary

What are Critical Success Factors?

  • For example CSFs are industry, environmental or strategic factors.
  • These factors can determine your companies success or failure. 
  • John F. Rockart of MIT’s Sloan School of Management 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.”

How can CSFs help you?

  • Identifying Critical Success Factors helps to measure your progress toward achieving strategic goals.
  • CSFs provide a common point of reference so that everyone in your company knows exactly what’s most important.
  • They ensure that tasks and projects are aligned across teams and departments.
  • It is recommended to limit the number of CSFs to just four or five. This helps to ensure that each CSF has maximum impact and gives clear direction on priorities in your company.

Who created this tool?

  • The concept of CSFs was first developed by Ronald Daniel in his article “Management Information Crisis” (Harvard Business Review, September-October 1961).
  • John F. Rockart built on and popularized the idea almost two decades later.

What are the four types of CSFs?

Rockart identified four main types of CSFs. Each of the CSFs that you establish in your company will likely fall into one of these groups:

Type # 1 Industry factors

  • They result from the specific characteristics of your industry.
  • These are the things that you must do to remain competitive within your sector.
  • For example, a tech start-up might identify innovation as a CSF.

Type # 2 – Environmental factors

  • They result from macro-environmental influences on your company: the business climate, the economy, your competitors, and technological advancements.
  • A PEST Analysis can help you to understand environmental factors better.

Type # 3 – Strategic factors

  • They result from the specific competitive strategy that your company follows.
  • This could include the way your company chooses to position and market itself, and whether it’s a high-volume, low-cost producer, or a low-volume and high-cost producer.

Type # 4 – Temporal factors 

  • They result from the companies internal changes and growth and are usually short-lived.
  • Specific barriers, challenges, directions, and influences will determine these CSFs.
  • For example, a rapidly expanding business might have a CSF of increasing its international sales.

What is the difference between CSFs, KPIs and Strategic Goals?

  • Critical Success Factors are derived from your companies mission and strategic goals.
  • CSFs determine the objectives and what you need to achieve, and how you will achieve it. Once you’ve identified your CSFs, you can also develop Key Performance Indicators (KPIs).
  • KPIs are the specific, measurable criteria to assess performance. They provide the data that enable the company to decide whether CSFs have been met, and if goals have been achieved.

What are the six steps to identify and develop your CSFs?

To identify and develop CSFs for your company I recommend to follow these six steps:

Step #1: Mission & Strategic Goals

  • Establish your company’s mission and strategic goals.

Step #2: Ask: What is essential to achieve this goal?

  • For each strategic goal, ask yourself, “Success in what area of business or project activity is essential to achieve this goal?”
  • The answers to the question are your potential CSFs.

Step #3: Evaluate

  • Evaluate your list of candidate CSFs to identify the ones that are truly essential for achieving your goals – these are your Critical Success Factors.

Step #4: Measure

  • Determine how you will monitor and measure each of your CSFs.

Step #5: Communicate

  • Clearly communicate your CSFs to those responsible for delivering them.

Step #6: Monitor

  • Continually monitor and reassess your CSFs to make sure they are aligned.


  • Key Point #1: CSFs are factors that determine your companies success or failure. 
  • Key Point #2: Your CSFs will fall into one of the four main types of CSFs.
  • Key Point #3: There are six steps to identify and develop CSFs for your company.

Supporting you

I´m available to support you by re-imagine your business and propel it to the next level. The clarity about your CSFs will help you to create a thriving business.

Contact me for a complimentary 30-minute strategy session:

Coming up next month

In my next blog post, I´ll share the MoSCoW analysis.

Stay tuned!

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