Critical success factor, are those aspects that would need attention to achieve the goal or objective of the process. It should be understood that there is a huge difference between KPI and CSF in ITIL, both are not the same. KPIs are the usually easily quantifiable performance indicators that would help us evaluate performance and take appropriate actions to improve performance, while CSFs are the factors that determine the effectiveness of the process.
Critical Success Factors were first introduced by D. Ronald Daniel in a 1961 Harvard Business Review (HBR) article. Daniel highlighted the types of information needed to support top management activities. He stated that an organization's information system should be selective and focused on providing details of three to six success factors that help the organization achieve success.
When we use the term metric, we are referring to a direct numeric measure that represents business data in the relationship of one or more dimensions. A simple metric statement is "number of bad CIs each month". In this case, the measure would be the number of erroneous CIs and the dimension would be time (months).
The metrics are not the KPIs themselves; rather, they are needed to determine whether our KPIs have been met. The KPI that the above metric could use could be “% Reduction of Bad CIs Each Month” - you need the actual bad number in order to determine the% reduction from the number of bad CIs in the previous month.
Developed between 1979 and 1981, the concept related to critical success factors has gone through several layers of refinement advised by renowned researchers. CSFs are generally very essential elements for the success of a strategy or for a goal / objective to be achieved. Often used to refer to an organization's vision, mission statements or business strategy, CSFs must necessarily be in place for a project / goal to be successful. The success of the CSF drives a strategy forward.
Key performance indicators represent a particular value or characteristic that is measured to assess whether an organization's goals are being met. They reflect critical success factors, stakeholder needs and organizational expectations. For KPIs and their measures to be effective, the organization's goals must be specific, measurable, agreed upon, realistic, and time-bound. KPIs can use financial and non-financial metrics.