By David Parmenter
1. Gather success factor wording used in the past
The KPI team needs to review the strategic documents in their organisation covering the past 10 years, then extract and develop success factors from these documents. You may find an old strategic document written by an executive, long since moved on, which could prove very helpful because the success factors are still relevant.
The KPI team should interview as many of the organisation’s “oracles,” the wise men and women who everybody refers to for advice, as possible, along with the entire senior management team. From this information you will be able to come up with a list of success factors. To assist, I have provided a checklist in PDF format, for you to download.
2. Hold a CSF workshop to get the wording better
Gathering a selection of experienced managers, who will be attending the CSF workshop, train them in how to word success factors. The wording is very important and should meet the SMART criteria attributed to Peter Drucker.[i] While Drucker was addressing goal setting, the same rules apply to success factors. Success factors need to be:
- Specific—A statement that avoids using meaningless, empty words sometimes referred to as “Weasel words.” Avoiding empty words, that are so common in management terminology, is not as easy as you might think. As we move up the management ladder, we increasingly use empty words having heard them used so often. Common weasel words include:
Accelerate, adaptive, balanced, barriers, best practice, collaborative, dynamic, effective, efficient, end-user, empowered, holistic, improvements, inclusive, innovative, integrity, optimized, outcomes, outputs, quality, recognition, reliability, renewal, responsibility, significant, solution, special, synergies, targeted, transformation, value-added, well-being, winning, world-class
The term “increased profitability from our product range” is an empty statement. There is no guide to how this is to be achieved. Whereas “timely departure and arrival of planes 24/7” is clearly specific.
- Measurable—A statement with words that lend themselves to measurement. If you could not instantly think of a measure or two, then it is odds-on that it does not fit this criterion. “Timely departure and arrival of planes 24/7” is clearly measurable.
- Achievable—A statement that talks to the staff in a clear and concise way, making the activity achievable. For example, “timely departure and arrival of planes 24/7” is clearly achievable.
- Relevant—Focused enough that it is relevant to staff in the organisation. “Timely departure and arrival of planes 24/7” is clearly relevant to many operational teams: flight crew, front desk, baggage handlers, cleaners, fuel and food suppliers.
- Time sensitive—Focused on the here and now. “Timely departure and arrival of planes 24/7” is clearly a 24/7 imperative for an airline.
Exhibit 1 shows a list of success factor statements that contain empty words. These have been contrasted to SMART success factors and external outcomes.
EXHIBIT 1 Wording Success Factors and External Outcomes (extract from the CSFs toolkit)
| Success factors which are meaningless (empty words signifying nothing) | SMART Operational success factors | External outcomes |
| Increased profitability | These three statements are a result of more than one operational success factors at work. SMART replacements would be ‘Delivery in full all the time to key customers’, ‘Fix problems to get quality right the first time’, ‘Seeking excellence in every aspect of our interaction with our key customers’. | Increased profitability by selling a higher percentage of higher margin products. |
| Retention of customers | Retention of key customers | |
| A say, stay, strive engagement with staff | Maximizing the use of our most important resource—our people. | |
| Optimizing innovation | Innovation is a daily activity. | Growth in sales of new products. |
| Deliver in full on time | Deliver in full, on time, all the time to our key customers. | Growing business through our major customers. |
3.Finalize the wording of the success factors and external outcomes
In the CSF workshop there will be one or two break-out sessions where the attendees review the operational success factors, tighten up the wording so they are SMART and separate out the external outcomes (e.g. retention of key customers) and strategic objectives (e.g. product leadership in our sector) into separate lists.
In a recent workshop where we had split the exercise up over six teams two teams were asked to review the same section (15 of the 45 draft success factors). We created a panel of three comprising the CEO and two GMs. The two teams went to the panel and argued for their proposed changes. The panel had the final decision. The debate created a session that derived a thorough list of approved success factors.
[i] Peter F. Drucker, The Practice of Management (New York: HarperCollins, 1954).
[ii]Stacey Barr, Practical Performance Measurement- Using the PuMP Blueprint for fast, easy and engaging performance measures. Pump Press 2014
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