Metrics That Drive Execution: What Founders Need to Get Right

Two people can agree to the same number and walk away with completely different expectations.

One sees a commitment the company must meet. The other sees an ambitious target worth pursuing. That difference shapes their decisions about priorities, resources and what happens if they fall short.

Over 25 years, I’ve worked with hundreds of leadership teams, from early-stage companies to growth organizations with hundreds or thousands of employees. Across those stages, the same principle holds: teams need a shared understanding of what a goal means, why it matters and how their work contributes to it.

Understand KPIs and other important metrics

Metrics are the numbers a company uses to understand its business and set goals. Key performance indicators, or KPIs, are the measures chosen to indicate performance against its most important objectives.

All KPIs are metrics, but not every important metric needs to be a KPI.

Runway, for example, estimates how long a company can operate before exhausting its cash at its expected rate of cash use. That context matters alongside performance indicators such as revenue growth or customer retention.

The numbers worth tracking help the team understand progress, recognize a constraint or make a decision.

Build metric-based goals together

A common mistake is for a leader to set a number and expect everyone else to figure out how to reach it.

That skips the conversation about the assumptions, capabilities and resources behind the target. People may agree in the meeting while holding different views about what is possible.

Leaders bring direction and expectations. Team members bring knowledge of customers, capacity, constraints and opportunities. Building goals together brings those perspectives into the same conversation.

Teams also need a shared definition of each metric so everyone understands what is being measured.

That shared understanding creates a stronger commitment to the goal.

Give every target context

Is the target a must-hit commitment? A threshold that signals the need to change spending, priorities or capacity? Or a shoot-for-the-moon goal intended to stretch the team?

Teams need to understand those expectations before work begins.

Without that context, people may treat an essential commitment as optional or interpret falling short of an ambitious target as failure. Both can damage trust and distort decisions.

Context includes the purpose, time frame, assumptions and implications of the goal. It gives people a shared basis for judging progress and deciding when something needs to change.

Connect company goals and team goals

Metrics should connect to the larger direction, often within the three-year vision and one-year plan objectives. Quarterly, monthly and sometimes weekly targets make progress toward the one-year plan visible at useful intervals.

Those targets should reflect how the business works. Progress will not always divide evenly across the year.

As the organization grows, the leadership team owns company-level metrics, while other teams develop goals that connect their contributions to company success.

As with aligned objectives and key results (OKRs), this team of teams model connects goals across functions. Teams need to understand how their goals support one another and where their decisions create tradeoffs. Increasing sales, for example, has implications for the teams responsible for delivery and customer experience.

That connection helps people see both their responsibility and their contribution to the bigger picture.

Start before you have perfect answers

Early-stage teams sometimes avoid setting goals because they don’t know what the numbers should be. They worry about discouraging the team or looking bad to investors if they miss.

But without a starting point, it is harder to evaluate progress or learn what the business can achieve.

Start now. Start somewhere. Be clear about the assumptions and uncertainty behind the goals.

An initial target gives the team something to measure against, question and learn from. A miss can reveal an unrealistic assumption, a capability gap or a change in the market. Understanding why helps the team improve.

Metrics belong in an ongoing operating cycle: learn, adapt, plan and act. Teams learn from results, adapt their approach, plan the next steps and act together. New results inform the next cycle.

What teams measure—and how—will evolve as they learn to master the business. When goals change, keep the original expectation visible and explain the adjustment.

Metrics, including KPIs, make goals measurable and show whether the organization is moving toward them. OKRs focus teams on building the capabilities needed to reach those goals and support growth.

Together, they help teams recognize execution drift: the difference between where they intended to be and where they actually ended up. Understanding that gap helps teams question assumptions, strengthen capabilities and decide what should change.

That is where the numbers become useful for execution: they help teams learn together and make better decisions about how to move forward.

About the author

Jeff James Martin is the founder and CEO of Collective Genius, an organizational execution company that helps founders and leadership teams execute better together. He is the creator of Peak OS, the company’s system for connecting direction, alignment, execution and learning across the organization, and author of Peak Teams.