Sunday, March 30, 2014

CSF in the Strategic Planning Process

 The CSFs are very important, more particularly in ensuring strategic focus!

Organizations large or small face the new VUCA reality –Volatility, Uncertainty, Complexity and Ambiguity. Can Critical Success Factors (CSF) narrow the universe of uncertainty in the Strategic Planning Process?

The CSFs are very important, more particularly in ensuring strategic focus, as the organization is aware of the key issues it needs to responds to, in order to create value in its core business. While these (CSFs) might not have changed much, due to the fact that at most of the CSF are closed aligned with the sector/industry competition pillars (what each industry player needs to deliver on to survive), what does change most often is the critical business activities which dictates what organizations do to respond to the CSF. For example, the four areas business should consider in their strategic planning will include:

  • Internal factors that are specific to the organization.
  • Strategic objectives that line up with the business' mission, vision and how the business will like to position themselves, their competitive strategy.
  • External Influencers such as economy, technology, etc. 
  • Industry characteristics that the organization needs to stay competitive 
Exploring the CSFs and detailed critical business activities should reduce the uncertainty by anticipation, because there would be an increase in the range of planned activities against the potential unplanned (presumably unforeseeable) activities. But caution should be taken in managing the cost associated with reduced uncertainty as a function of time spent improving the quality of informational inputs for better strategic decisions. At the end of it, all businesses are dealing with measurable efforts of attempting to influence external factors that by all accounts, no matter the efficiency in planning are not controlled by organizations. The CSF Types:
  • Industry structure (industry CSFs) 
  • Competitive strategy, industry position, and geographical location (strategy CSFs) 
  • The macro-environment (environmental CSFs) 
  • Organizational problems or challenges (temporal CSFs)
  • Management perspective (management CSFs)
CSF really depends on many variables that are influenced by the advancements and changes businesses have experienced to date. From each variable, you yet have to pick adequate CSFs for your business. And you will notice that immediately when you try to make a CSF more concrete by identifying a CSF, assigning a rule with values to it, developing an activity plan and 1) determine (within some %) when your business needs to start and complete its changes, and 2) pinpoint the processes that must change in order to successfully deliver the new business (survivability) in the new market. Or, determine when to begin to move into a different market, product set, so business losses can be mitigated? The CSFs as elements are industry or sector specific, which drive success for actors in that industry. They are pillars or rather core competency areas, with performance against which determines whether a company in that industry stands a chance of survival.

If you want to narrow the universe of uncertainty, aside from CSFs, you can do environmental scanning, force field analysis & consider frame-breaking & sustainable improvements in the organizational, operational, management & financial aspects of organization. Business environment is ever changing with increasing speed, however, the marketing mix conceptually is more static. How it is executed might be variable as customers, technology etc become more sophisticated but the principles, as guiding pillars still apply.


Strategic planning process has 9 steps to make effective use of human and material resources of organization for achieving objectives of organization.

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