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Critical Success Factors and Organizational Performance. Prepared by: Niemann, Lahlou, Zertani & Pflug. Lecturer: Ihsan Yüksel. Introduction. In this project, critical success factors approach will be used in measurement of organizational performance.
Prepared by: Niemann, Lahlou,
Zertani & Pflug
Lecturer: Ihsan Yüksel
Critical success factors refer: posses to be successful in the industry they work in.
multi-criteria analysis techniques
In this step, first the factors necessary for the organization to be successful in its sector have been determined.
The factors considered for the example organization in the project are as follows:
SF2: brand image
SF3: effective advertising
SF5: customer satisfaction
SF6: distribution skills
SF7: managerial ability
SF8: consumer loyalty
SF9: low product cost
In this step, firstly, the factors that attribute a success factor as “critical” have been determined.
Criteria (main factors) which are considered to determine the
“critical” of a success factor are as follows:
In this step secondly, weights of factors had been calculated by the AHP technique. In other words, relative importance has been calculated.
Table 1: Scale of relative importance used in the pair-wise comparisons of AHP
After forming the pair-wise comparison matrix, weights of factors have been calculated. In this project, weights vectors had been determined as follows:
Table 3: Weight of Main Factors
) of the elements in the
consistency vector is:
The consistency index (CI) have been calculated using the following formula:
Random index obtained from the Table 4. For this example RI is 0,58.
Table 4: Average random consistency (RI)
Each success factor has been evaluated a number between 1-10. And, each column (SC, CV, PF) have been summed (Table 5).
Table 5: Factor Evaluation
Table 6: Normalized Matrix
Normalized matrix and the vector of main factor weights have been multiplied.
According ranking of success factors is as follows : First factor is SF09, second is SFO6 and third is SF03 etc.
Step 3: Determining threshold value for determining critical success factors
At this step, a threshold value had been determined so that critical success factors have been selected from above in Table 7.
In this project threshold value was accepted 0.10
According to this value, these factors are:
Step 4: Making pair-wise comparisons of critical success factors and calculation of the weights of critical success factors.
Table 8: Pair-wise Comparison Matrix of the Critical Success Factors
Table 9: Weights of Critical Success Factors
Step 5: Determining organizational performanceAt this step, performance of the organization has been calculated using critical success factors weights (Table 9) and evaluation scale (Table 10) that provide in the literature.
Table 10: Level of Factors
If the general performance level value is close to 0, this means that organizational performance is very bad,
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