While forming corporate objectives, managers may find it useful to identify the key factors, which are needed to be kept in view to ensure organizational success. These critical success factors (strategic factors or key factors for success) should form the basis for business strategy in any industry. CSFs allow the business to put concentrated focus on a particular area and exploit the opportunities available therein to its advantages. This, of course involves a three step process:
1) What does it take to be successful in this business? (Generate CSFs)
2) What should the organization’s objectives and goals be with regard to CSFs? (Drawing CSFs into objectives).
3) How will we know whether the organization has been successful on this factor? (Identifying performance standards).
It is however, doubtful whether concentrated deployment of resources in a few areas would ensure the success of a firm in a competitive situation. Others may attack the arena with all their might. Such a myopic view would prevent a firm from peeping into area hitherto unexplored which could fetch substantial returns, to overcome these problems, if the firm distributes its resources in several areas, it may lose its focus and distinct competitive advantage(s).
India’s most Respected Companies Critical Success factor:
Infosys Technologies – Openness, honest practices, transparency, proactive, management, talent pool.
Hindustan Lever – ability to attract and retain talent, the value systems, multi product portfolio, mega brands.
Reliance Industries – Ability to execute mega projects at least cost and great speed; running ahead of times with a portfolio of diversified businesses with great profit potential visionary leadership
Wipro – Integrity ethics, ability to connect with customers, emphasize on quality at all levels.
ICICI bank — Asset creation and funds consumption at remarkable speed; technology driven initiatives, aggressive marketing efforts.
Every firm therefore needs to keep its eyes wide open so that it can spot opportunities early, convert these into value adding business propositions and enhance share holders value without diluting its focus on its core competencies. The road to success obviously is not a smooth one. Every firm needs to fine tune its energies and resources in line with market changes and customer expectations in its own unique, inimitable style.
Corporate Social Responsibility:
An important question facing managers today is whether corporations have some responsibility to improve the world or only to improve their profits. Until the middle of the twentieth century, a firm was generally viewed as an economic institution to provide wanted goods and services for public consumption and a profit for the owners. In the classic economic model, a firm is an economic institution governed by economic values and subject to the economic machinations of the market place. Two significant developments changed all of this. The first occurred in the first half of the twentieth century as professional managers replaced owners in running big companies. Professional mangers played more of a trustee role; they were responsible to the board of directors and interest of suppliers, customers, employees, and other claimants. The second development was the change in public attitude towards big businesses. The Needs Theory of human behavior states that once basic economic necessities are satisfied, people become more concerned with psychological needs relating to status, esteem, social justice and quality of life. In a land of scarcity economics is king, in a land of plenty economics is just another member of the royal court. Goals, values and attitudes of various groups in society have changed significantly over the years – reflecting a greater concern for improvements in quality of life. A firm after all is a social institution. It does not flourish in a vacuum. In all its operations it is vitally influenced by its environment.
Excerpts from VSP and Hari Krishna
The decisions made by corporate managers not only affect the community lives but may affect significantly both the national and international economic activity.