You are driving down the road when a cop pulls behind you, no lights flashing, just turning onto the highway and you happen to be in front. You aren’t speeding, intoxicated, on your phone, or anything else of concern. Just going from A to B, but you still glance down at the speedometer, just in case. At this moment, you don’t care about your engine temperature, how much gas you have, or if your oil pressure is low. You are just checking the main indicator relevant to your situation at the time to ensure you don’t give the officer an excuse to meet his quota this month.
This logic applies to businesses as well.
Too often I see executives and managers attempt to cram every metric they know about into a single dashboard in an attempt to ensure they are "in the know" of their business. I appreciate the intention, but this will inevitably steer your business off course. Let’s hop back in the front seat and assume we are now taking the same stance as our eager executive. You notice the cop but at the same time you begin checking to see how many miles you have left on this tank of gas, is the tire pressure looking good, what are the kids saying in the backseat, oh those sure are bright flashing lights behind me…
Congratulations, you manage to eek over the speed limit for just a moment at the worst possible time and are presented with the court-mandated opportunity to contribute $125 to your local township. Or in the business world, you have now missed your quarterly targets because your attention was split on the little things and you weren’t paying enough attention to what really mattered.
Set notification thresholds
Attempting to focus on everything all the time means you cannot focus the attention needed on what is important. That is not to say monitoring shouldn’t occur, it’s simply that you shouldn’t be constantly looking at it. Since I don’t know what business you are in then humor me as we focus on engine temperature for this example. If your car begins to overheat then you will be notified and of course, you will pull over and remedy the situation. No one will argue that your engine melting is not the most ideal situation, but you don’t need to glue your eyes to the temperature gauge every trip. Once the normal threshold is breached, then you can focus your attention on it. Until then, there is nothing to worry about, you are clearly still moving forward.
Keep in mind that the notification doesn’t come after the engine is melted, you get notified once something is no longer within the normal range. After leaving this threshold your attention is called to the issue before it becomes an actual problem. This is exactly how you should approach your business metrics as well. It doesn’t matter if your metric has a lot of volatility or is steady week-on-week; there is some version of "normal" it experiences so set the triggers accordingly. Identifying an appropriate threshold can often be an art as much as science, so here are some questions you can ask to help you set an appropriate level:
- What value would the metric need to reach in order to cause alarm?
- Is there some upper or lower bound that simply is not acceptable?
- Would the metric begin to influence other metrics or processes once it exceeds a certain level?
- Is simply breaching the current goal a good enough notification?
- Is the trend more important than the actual value?
If you don’t have an answer for at least one of the above then you should really ask why you are even looking at said metric. However, if you are in the scenario where you don’t have a choice then I would at least recommend going with some sort of control limit. You can drop to 2.5, or 2 standard deviations if you want more of a heads-up, but this all depends on the volatility of the metric. Also keep in mind a trend or slope may be just as, if not more important than the actual performance. So the notification could be set based on repeated down or up-trends rather than hitting a certain level… or both.
Reviewing a green scorecard week after week provides no value as wastes time in meetings.
We inevitably scan for anything red or missing goal anyway, so why waste the time when things are under control? That’s not to say you should change the goals. The worst thing you could do is change the targets just because things seem to be under control. You absolutely can explore opportunities to operate at the next level, but that starts by reviewing your process capability not by asking for an arbitrary % improvement. For example, expecting the engine to operate at a colder than normal temperature is nonsensical – It’s supposed to get warm. Don’t lose sight that some metrics operate best in a range and shouldn’t be constantly driven further.
Automate the notifications
You are already reviewing a scorecard, so there is some ability to acquire this data on a regular basis. It’s likely there is already some red/green formatting for goals baked in. It’s a trivial exercise from that point to check if metric A is higher or lower than the set threshold. There is no excuse to not automate the display of alerts in your dashboard. The point is to shift the effort from manually scanning the scorecard in a meeting to having a computer scan it for you.
The time savings of no longer reviewing the less-important metrics may seem trivial but think of all the rabbit-hole discussions and spin-off meetings that occurred due to misinterpreting an inconsequential metric. It may be hard for some leaders to leave an OPS review without giving some direction, so it’s easy to ask for "double-clicks" into that one metric that "looks off". Heck, there is a high likelihood the leader forgot how it was even calculated. You already put enough faith in your car’s temperature gauge to safely get you from place to place. Trusting these new thresholds will be a much easier, and less risky task.
Executives and managers may not review the same metrics

It is uncommon that strategic measures are the same as operational metrics, this isn’t anything new but people tend to forget. You may not care about the detailed diagnostic output from your car, but your mechanic does. Much the same way that managers likely have no need to focus on company operating margins, but executives do. That said, managers still get asked questions on why certain trends are occurring, so there does need to be some translation between strategic metrics and operational metrics.
For example, if the executive needs to maintain a specific service level then managers can look to employee productivity. It’s not hard to see that a drop in productivity in the same week is likely the cause of the decrease in service level. This simple separation allows managers to work with measures that they have direct control over and relate specifically to them. Whereas forcing managers to explain a metric they can’t control or understand leads to spurious answers during reviews likely unrelated to the problem or based on anecdotal information.
Allow for autonomy
Let’s hop back in the car, this time with a passenger. A text comes in and you have a choice A) pick up the phone and read it B) ask the passenger to read it. In the world of responsible adults, everyone chooses option B. Choosing option A knowingly puts you at a temporary risk, regardless of how well you think you can keep your eyes on the road. The passenger is more than capable to read the text and let you know if it requires your attention or not. Was it a spam text about your car’s extended warranty, or did a friend’s parent just die? Either way, the passenger will inform you, and if action is needed it will still occur regardless of who originally read it.
This does require a bit of trust in others to do what they are supposed to but if you can’t trust them to do this then you likely have bigger problems than managing metrics.
There is no harm in bringing in a project manager or SME for anything that cannot be automated or is complex enough that it needs manual review. Giving autonomy to the project managers or SMEs to monitor the operational metrics relevant to their domain will allow the leader’s focus to remain on key business initiatives. These SMEs will have proper context about the trends and be better suited to know when something truly is a problem and bubble it up as needed. Keeping discussions during business reviews free of needless guesswork about inconsequential KPI trends.
Change or reevaluate metrics as your focus shifts
Every business changes direction over time, so dashboards should change accordingly. For example, when driving down a dirt road the speedometer is no longer of any importance, and instead, your focus is on avoiding rocks or potholes in the road. Don’t hold on to legacy metrics just because they have always had a slot on a scorecard. If they are not directly supporting the direction you are heading in, then pop it back on Automation, hand it off to a SME to monitor, or get rid of it completely. Stop wasting your time!
The metrics you review should directly relate to the course of action or end goal you are trying to achieve, any that don’t are just a distraction. Ones that pull focus away from the goal will eventually spur unnecessary work that can cascade into an avalanche of fruitless actions. We already innately understand this process within our personal life, and nothing I have mentioned is a novel concept. So applying the same discipline in the business world should come naturally, yielding significant efficiencies and results.