Why knowing your business's CSFs must be a priority

Some of you might be asking, "what is a 'CSF'"? Second question might be "what are the CSFs for my business"?

CSF stands for 'critical success factor'. Put simply these are factors that are necessary to be in place, to be implemented, in order for your business to have any chance of achieving its goals. It can be difficult for a business to ensure that their CSFs are always in place but it does draw a line in the sand in respect to what they need to aim for, where their priorities should lie. Most of the time we only consider them as being attached to the business operations but what is often overlooked are the CSFs of the business owners themselves. These critical success factors that relate to the person are not characteristics or traits - rather I see them as behavioral tendencies that are relevant during a particular stage of the business.

I give you an example of a recent client of mine. His business had a dominant online presence however in order to continue being in a position to undertake the profitable jobs with corporates he needed to establish a high street presence. This also meant that he would have to give up running the day to day online operation and hire a number of employees which was going to be a challenge as he had grown his business from scratch.

The critical success factors, at the business and personal level, were:

1. Establishing a high street presence in a central location
2. Being able to delegate work and manage a number of employees who could multitask.

Put simply, without the two CSFs listed above my client's business would have no chance of operating in the way he envisioned.

There are long term and short term critical success factors - those that must always be in place and those that only need to be in place to achieve short term goals. A long-term CSF for the client above is that his company must be within the top 5 google searches, a short term CSF was that he had the initial funding for the shop (before it could begin to generate its own cashflow).

What wasn't critical was the size of the store, establishing an office for the employees or putting in place complicated operational processes. Expenses were kept to a minimum and all employees worked remotely. However without the store and the employees then the business would not have been able to develop - no matter how strong his company was online.

So have a think about the critical success factors for your company and whether you are undertaking those tasks that will let you achieve those factors.

Staying focused and motivated for your goals

How often would you experience the following:

'you have a great goal in mind, something you start off being extremely passionate about. You start with the research and make some good headway. You're still working to keep money coming in but this new idea should be ready to make money within 6 months and you could see it replacing your current full-time job within 12-18 months - that is also an important goal of yours. Some time goes by and you don't see to be making headway and your full-time job starts taking up more of your time. All of a sudden you wake up 6 months later and your great idea is no more. "Oh well", you say, "just wasn't the right time or right idea". Of course you might become disheartened and that's it - no more ideas'.

What I am framing is something that potentially affects many people who have ideas to start off a new project or business. Having an idea is the easy piece, implementing the actions that will progress you past the concept stage requires dedication. It also requires that you focus on the RIGHT PRIORITIES and make the RIGHT DECISIONS (or at least learn from the mistakes you made). It is easy for the brain to ignore pain and disappointment by focusing on something else. This is why if your idea/project is not progressing as expected it is far easier to focus on something else. However we often blame our environment for this 'failure' rather than ourselves. For many of us it is difficult to recognize your own personal biases when it comes to making decisions - whether that be the information you use for input, the experiences and assumptions you make when processing information and the fact that we rarely question our output.

Poor decision making combined with not knowing the tasks that should be prioritized because they offer most value to your project are two key reasons why many people lose focus and motivation. Not everyone is built to continually push past failure after failure and monetary wise many of us could not continue to do so. So what I am suggesting is that you become more efficient when it comes to making decisions and setting tasks. Doing this will result in more small wins and this progress will help you maintain your focus and motivation. So the simple steps to take are;

1. Ensure your idea is accompanied by a vision - supported by internal motivations/values

2. Don't keep your idea in your head. Write down what you need to do and if necessary speak to a business coach who can help you determine which tasks should be prioritized as they will lead to greater progress.

3. Be aware of your decision making biases - always look for independent feedback as well as analyzing why decisions made did not work out the way you expected.

4. Be conscious that you will fail only if you stop. Embrace the fact that setbacks are important but only if you learn from them.

Why small businesses and entrepreneurs fail

What is failure and why do so many business startups fail? Failure could be classified as not achieving goals such as working more hours than planned, lack of enjoyment and satisfaction, too much travel - however in vast majority of cases failure of a business is due to financial reasons. That is not making enough money to cover costs.

Why does this occur and so freqently? I have met a lot of entrepreneurs, both who have succeeded and failed in business (some many times over), and the one thing they have in common is intelligence and drive. So if this is what you think you need to have to succeed then think again. The difference between success and failure is decision making. The basis of decision making is information and insight and I believe the two go hand-in-hand in ensuring the most appropriate decision is made.

Thus failure in business is due to poor decision making because there was incorrect, lack of or inappropriate information used and that the insight of the entrepreneur was wrong. Insight itself is a cognitive process and basically a interpretation of external stimuli - so in fact decision making, both directly and indirectly, is correlated to the quality of information received.

Failure is due to making a wrong decision many times over because no effort is made to assess the decision making process. Working with a performance coach or psychologist is useful in understanding the basis for decisions made and making changes in your decision making process. If you fail once and don't assess the process for making decisions then the chances of making the goals or targets you have set are very low. You cannot assume you know how to make a right decision and the warning signs should not be ignored. Thinking you know how to make a right decision is one of those as you will not be open for change.

Small business also fails because the entrepreneur in charge of the business is not made out to work in such as environment. Making a decision to start a business is the first important decision you have to make and one of the most critical. If you get this wrong then your business may already be on the path to failure.