Understanding Critical Success Factors, KPIs, and Performance Targets (Full Transcript)

Speaker 1: critical success factors, and the key performance indicators and the performance targets. We've had a discussion on this already, but just want to quickly go through that so you are clear. So here we're talking about having the high level areas that you need to assess. So high level aligned to strategic goals, and then they're derived from the industry standards and the overall perspective, and then you look at the priority. So improved customer retention rate could be one of the critical success factor. So how can you improve? How can you actually measure that improvement is basically the next level of detailing, which is the key performance indicator. So based on this one, you can actually kind of define your own key performance indicators. So they check how well the CF, the CSF, the critical success factors are achieved. So that's the key performance indicators, right? So you need to identify, for example, the percentage of existing customers who do repeat purchases. That's a good way to understand your improved customer retention rate, right? And how do you do this? Percentage of existing customers is basically by looking at the performance targets. How well you have actually retained them. So they're the targets for specific areas. So you've got the current way of doing something, and then the projected or the estimated or the planned way of the figure. So basically the figures, they're the measures and the metrics, they're actually things that you can measure, the rates, the ratios, the effort variance, the schedule variance, the productivity figures, for example. All of these are the measures and metrics, and the defect density. All of these are something that could be measured. So they're the performance targets. So here you can actually set yourself, how would you like to move from the current state? So you say 60% of sales revenues from the existing customers by this end of this year. So that's a performance target for you. And then you can actually get to see whether you're getting it or not, right? Because that's the only measure by which you can actually assess whether your revenues had been in the line with the overall goals, which is basically the retention rate and then the improved customer retention rate. So this can only be achieved by following this, measuring this. And then if you've got this, then you can say that you've achieved it. So this is how you're actually getting into the details. You're not really talking high level, you're not talking in the air, you're actually talking sense, you're actually making sure that this is achieved or not achieved. This is the way that you can measure it. So very, very important for you to understand whether you're in the right direction in terms of a vision, just having that fantastic vision, great idea is not great. It's about implementation of that, taking that step to go ahead, do the stuff, do the actual work, and then make sure that you deliver something. And then assess whether whatever you've delivered is in line with your plan, with your original idea or not. So that's where these tools would really help.