In my view, one of the most misunderstood project concepts is Critical Success Factors. Over the years it has come up time and time again when I’m participating on project reviews or audits. The main issues I have found are:
- no identification of any CSFs
- CSFs identified, but not agreed with the customer
- the project manager’s CSFs differ from the customer's CSFs
- CSFs identified, but no agreed means of measuring them
- inappropriate CSFs identified
definition and goals
So many important matters can compete for your attention in a project that it's often difficult to see the "wood for the trees". What's more, it can be extremely difficult to get everyone in the team pulling in the same direction and focusing on the true essentials. That's where Critical Success Factors (CSFs) can help. CSFs are the essential areas of activity that must be performed well if you are to achieve the objectives or goals for your project. By identifying your Critical Success Factors, you can create a common point of reference to help you direct and measure the success of your project.
As a common point of reference, CSFs help everyone in the team to know exactly what's most important. This helps people perform their own work in the right context and so pull together towards the same overall aims.
Critical Success Factors are strongly related to the objectives of your project. They 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.
how to identify your CSFs
CSFs are best understood by example. Consider a typical telecoms project, whose strategic objectives are to:
- promote your company as the number one global supplier
- demonstrate high quality solution delivery
- complete the project within the agreed timescales
- maximize the profit margin
- achieve a high customer satisfaction rating
In order to identify possible CSFs, we must examine the objectives and see which areas of the project need attention so that they can be achieved. We can start by brainstorming what the Critical Success Factors might be (these are the "Candidate" CSFs.)
candidate Critical Success Factors
Promote your company as the number one global supplier.
Demonstrate high quality solution delivery.
Successful execution of project/quality plan.
Complete the project within the agreed timescales.
Deliver to the agreed project schedule.
Maximize the profit margin.
Meeting targets set in the project P&L account.
Achieve a high customer satisfaction rating.
Meet the targets set by management for customer satisfaction.
Once you have a list of Candidate CSFs, it's time to consider what is absolutely essential and so identify the truly Critical Success Factors.
my own example
This is certainly the case for the telecoms project. One CSF that we identify from the candidate list is "Professional Project Management." This is absolutely essential to ensure good planning, quality and risk management for example.
Another CSF is to deliver to the agreed project schedule. It is by consistently meeting the agreed milestones that confidence and trust is built, therefore ensuring future engagements based on reliability.
A third CSF is meeting the customer satisfaction target. One of the major factors of success is to determine if the customer provides a high rating, which provides confidence we are doing the right things at the right times.
tip: how many CSFs?
Whilst there is no hard and fast rule, it's useful to limit the number of CSFs to five or fewer absolute essentials. This helps you maintain the impact of your CSFs, and so give good direction and prioritization to other elements of your business or project strategy.
In reality, identifying your CSFs is a very iterative process. Your project objectives and CSFs are intrinsically linked and each will be refined as you develop them.
Here are the summary steps that, used iteratively, will help you identify the CSFs for your project:
- Step One: Establish your project's objectives.
- Step Two: For each objective, ask yourself "what area of project activity is essential to achieve this goal?" The answers to the question are your candidate CSFs.
- Step Three: Evaluate the list of candidate CSFs to find the absolute essential elements for achieving success - these are your Critical Success Factors.
- Step Four: Discuss and agree the candidate CSFs with the customer and produce a final list.
- Step Five: Identify how you will monitor and measure each of the CSFs and agree with the customer.
- Step Six: Communicate your CSFs along with the other important elements of your project's strategy to the concerned stakeholders.
- Step Seven: Keep monitoring and re-evaluating your CSFs to ensure you keep moving towards your aims. Indeed, whilst 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.
- Step Eight: At the end of the project, review the CSFs with the customer and jointly agree the outcome. Remember to use relevant output for the lessons learned report.
Critical Success Factors are the areas of your project that are absolutely essential to its success. By identifying and communicating these CSFs, you can help ensure your project is well-focused and avoid wasting effort and resources on less important areas. By making CSFs explicit and communicating them with everyone involved, you can help keep the project on track towards common aims and goals.
Project and program management is at the heart of any successful business as it enables businesses to change by delivering new capabilities and realizing benefits in line with the organization's strategic objectives. I am passionate about project and program management and love discussing it and developing improved ways of doing things.