Key Success Factors

1. Financial resources
2. Customers
3. Employees
4. Products and services
5. Innovation
6. Uniqueness

These elements don’t operate independently. They all impact your performance.

Employees – Gaining Employee Commitment

 Employees are human resources that work for you

 Executes daily activities
 Without trained knowledgeable employees, organization will struggle
 Employees’ emotions regarding their workplace significantly affects their performance
o Loyalty, work ethic, productivity, morale
 Low turnover = good hiring system
o Turnover: percentage of employees that leave and need to be replaced each year
 Absenteeism is a good hint that employees are unsatisfied
 Absenteeism: number of days employee misses work
 Number of applications received for a job indicates how attractive your workplace is
o Shows reputation and brand equity

Customers – Ensuring Customer Satisfaction

 Consumers can be divided into segments based on similar desires regarding products or services
 Company’s focus point when designing and selling products (target audience)
 Provides revenue (for-profit businesses)
 Fulfilling need of consumers = reason of organization
 If product/service does not satisfy consumers, consumers will purchase from competition
 Customers are connected to employee commitment
o If products don’t satisfy consumers, consumers don’t like the company
 Affects innovation
o Customers’ needs/wants forces companies to provide new things
 Satisfying customer needs leads organizational success
o Customers will be loyal to the brand
 Identify target audience, understand the desire, deliver
 Buying factors -> looks, functionality, convenience, comfort, safety, status
 Anticipating consumer needs -> creates new needs for customers
 Key performance indicators:
o Market share
 Portion of total market revenues you earn
o Share of wallet
  Percentage of a customer’s total spending on your product is spent on your
product
o Net promoter score
 Likelihood of consumer recommending your product to another individual

Products and Services – Producing quality products and services

 Producing quality products = delivering value

 Must be consistent and reliable level of quality
 Quality determines price
 Key performance indicators:
o Returns
 Percentage of products returned
o Defects and warranty
 Implies product is not expecting to last long
o Waste
 Measures inputs relative to output
 Efficiency

How does a company do this?

1. Define value for the situation

2. Consistency, gives consumers predictability
3. Structured production
4. Quality control

Innovation – Encouraging innovation and creativity

 Valuable change
 Environment is changing, so should businesses
 Linked to consumer needs
o Leads to new desires of consumers
 Gains employee commitment
o Meaningful change
o Change is what most people want
 Variety, success, challenge
 Affects financial performance
 Affects uniqueness
 Having a structure that enables new knowledge and ideas sparks innovation
 Innovative cultures reward innovation as a whole
o Encourages employees to innovate
 Key performance indicators:
o Idea generation
 Measuring how many are put forward is valuable
o Cycle time
 How quickly an idea can become a product/service
  Shorter cycle time = better at implementing innovations

Uniqueness – Creating distinctive competitive advantage

 Being different from competitors

 More uniqueness = higher value
 Different style attracts applicants/customers
 Creates loyal customers
o Can’t find product/service anywhere else
 Reduces competition
o Nobody is similar to the business
 Understand what competitors are doing, understand what makes yourself different in a positive
manner
 Determine what the market values
o Determine unique methods of delivering those values
 Key Indicators:
o Market research
 Identifies what reputation is and being known for something
o Financial statements
 Compared to competitors
 Higher gross margin?

Financial Resources – Achieving financial performance

 Money earned, possessed, or able to obtain

 Make the business an attractive investment = improves profit and return on investment
 Money affects other factors as it can either be limiting or extremely resourceful
 Key factors:
o High ROI = attractive investment
o Growth in revenue, profit, ROI = company is getting better at executing strategy and
operations