Business Strategy Metrics

Your influence in the board room and executive team is 90% communication with measurable examples. The words you use can make or break you. Naturally, I've been compiling a list of "instead of saying this, say this" with measurable results. Many are based on my gotcha moments where I've failed miserably at explaining what marketing does. I've said things like: “We’re increasing brand awareness.” “Our demand generation efforts are working.” “We’re improving our SEO strategy.” Every marketing leader has said some version of these. The problem? Nobody in the boardroom or executive team cares about (or understands) marketing buzzwords. They care about revenue, efficiency, and business impact. Let's flip the script. I've compiled a list of marketing-speak and translated these statements into terminology a room full of non-marketers would understand. And bonus, I've included the right metrics to back them up. Example: 🚫 Don’t say: “We’re generating a lot of leads.” ✅ Say this instead: “We’re bringing in people who are actually interested in buying.” 📊 Measure it with: Organic Traffic, Demo Requests, MQL-to-SQL Conversion Rate I put together a full table of these translations and a template so you can ensure your marketing efforts land in the boardroom. I'll share the list and other communication tips this weekend in my newsletter, but if you just want the table. Let me know. Drop a “TABLE” in the comments, and I’ll send it over.

New CMO: We're moving 50% of the marketing budget to brand / top of funnel. VP Growth: Hell no. My ROAS will drop, and my bonus depends on hitting a ROAS target. New CMO: Not anymore. Your bonus is tied to two metrics: 1. Total contribution dollars generated by the business (at 35% contribution margin). 2. Contribution dollar lifetime value (rolling 30, 60, 180, and 365 days) for our owned business. VP Growth: wtf?! How can I own this? New CMO: Metrics aren't about individual ownership—they're team-driven. The real challenge is choosing the right ones. VP Growth: How do we know these are the right metrics? New CMO: The right metrics grow business health and fundamental enterprise value. If we increase these metrics, while keeping fixed costs flat, we become more profitable. Are they perfect? Maybe not. But they're miles better than short-term ROAS or new customers acquired, which have far less of a direct connection to fundamental business health when we increase those numbers. VP Growth: How can you say that? New CMO: For ROAS, you can hit any number by: 1. Spending less. 2. Doubling down on branded keywords, existing customers, or retargeting. 3. Running more discount events. But ROAS lacks incentives to drive incremental revenue—what actually grows the business—and says nothing about the cost to generate it. And for new customers acquired, there is no notion of customer quality. A massive sale drives high ROAS but attracts discount hunters who won't buy at full price unless we run bigger sales. Both of these metrics lack context on quality and long term profit, which is ultimately the fundamental goal of business. VP Growth: Ok, I'll buy that, but how can I be responsible for overall contribution dollars? New CMO: As a singular individual, you can't. That's why half of your budget will now be based on team performance. For you though, it'll drive you to make better decisions with how you spend our marketing dollars VP Growth: What do you mean? New CMO: You're free from short-term ROAS pressure to pad stats and can focus on incremental profitable growth. You can step back and do the things you know are right to drive net new incremental demand (meaning: you would not have gotten that revenue if you didn't spend that ad dollar) even if it's low ROAS. VP Growth: And the mythical purse string holders are bought in? New CMO: Yup - the CFO and board now understand that the real goal for our marketing investments is both short and long term incremental contribution dollar generation at the highest possible contribution margin. That was my one condition for agreeing to accept the offer to join VP Growth: Well butter my biscuits, let's do this. New CMO: Please never say that again

Companies and their CEOs obsess over Profitability KPIs. But measuring Profit doesn’t drive Profit. Here’s the problem: Most leaders don't track the right metrics. They don't understand why they matter. They ignore stakeholder perspectives. If you don’t know and act on what the numbers are telling you - you’re not managing profitability. You’re just collecting data. Let’s fix that. Here are 16 Profitability KPIs every CEO and CFO needs to master—and how to extract the insights that drive smarter decisions: ■ Efficiency and Margins 1// Gross Profit Margin Ratio ↳ Why it matters: high margins signal strong pricing power or cost efficiency. 2// Contribution Margin ↳ Why it matters: critical for setting prices, understanding break-even points, and ensuring your products are profitable. 3// Operating Profit Margin Ratio ↳ Why it matters: reveals how well you’re managing core expenses 4// Net Profit Margin Ratio ↳ Why it matters: measures whether your business model scales profitably. 5// Return on Assets (ROA) ↳ Why it matters: shows how effectively your assets generate profit. 6// Return on Equity (ROE) ↳ Why it matters: measures investor return on their investment. 7// Return on Investment (ROI) ↳ Why it matters: helps prioritize high-ROI projects and avoid initiatives with weak returns. 8// Return on Capital Employed (ROCE) ↳ Why it matters: indicator for how well your business uses all available capital to drive profits. ■ Earnings and Market Performance 9// Earnings per Share (EPS) ↳ Why it matters: tells shareholders how much value each share represents. 10// Price-to-Earnings (P/E) Ratio ↳ Why it matters: gauges whether your stock is fairly priced based on earnings. 11// Dividend Yield Ratio ↳ Why it matters: income-focused investors seeking regular returns. 12// Dividend Payout Ratio ↳ Why it matters: balances reinvesting for growth with rewarding shareholders. ■ Cash Flow and Productivity 13// Operating Cash Flow Margin ↳ Why it matters: shows how well you convert revenue into cash. 14// Profit Per Employee ↳ Why it matters: tracks workforce productivity—a crucial metric for scaling efficiently. ■ Advanced Profitability Metrics 15// Economic Value Added (EVA) ↳ Why it matters: measures value above the company's cost of capital. 16// Break-even Revenue ↳ Why it matters: knowing your break-even helps you set realistic sales targets and avoid losses. The takeaway? Stop chasing KPIs for the sake of it. Start using them to lead smarter and grow faster. Want to join the 1% of CEOs who lead with financial intelligence? ▷▷▷ Join me tomorrow for a free webinar for CEOs, VPs, Managers, and leaders and start making 100% better business decisions: https://bit.ly/ceojan18 ▷▷▷ Transform your financial acumen in 6 weeks - live program, spots are limited, starts January 29: https://bit.ly/3ZCI0kr ♻️ Like, Comment, Repost if this was helpful. And follow Oana Labes, MBA, CPA for more

By now, the "95% failure rate" of GenAI financial returns (ref MIT's Project NANDA) is part of all consulting decks. The report blames the incorrect approach as the primary reason, rather than model maturity, etc. The key is to understand what #ROI metrics are used to determine the financial returns. I asked #Copilot on this, and here's what it told me: --- Here are three examples of ROI frameworks that enterprises are using to evaluate and scale GenAI adoption effectively: 1. Business Outcome-Based ROI Framework (Gartner) Summary: Gartner recommends aligning GenAI initiatives with measurable business outcomes such as cost reduction, revenue growth, or productivity gains. For example, a retail company using GenAI for automated product descriptions tracked a 22% increase in conversion rates and a 15% reduction in content creation costs. The framework emphasizes setting baseline metrics before deployment and tracking improvements post-implementation. 🔗 https://lnkd.in/dER7cTeF 2. Time-to-Value and Efficiency Metrics (BCG) Summary: Boston Consulting Group suggests using time-to-value (TTV) and operational efficiency as key ROI indicators. In one case, a logistics firm used GenAI to optimize routing, reducing delivery times by 18% and fuel costs by 12%. BCG’s framework includes pre/post comparisons, automation impact, and employee productivity metrics to quantify GenAI’s contribution. 🔗 https://lnkd.in/da2zcSfW 3. Model Performance vs. Business KPIs (McKinsey) Summary: McKinsey advocates for linking GenAI model performance directly to business KPIs. For instance, a financial services firm used GenAI for customer support automation and tracked resolution time, customer satisfaction scores, and call deflection rates. The framework includes continuous monitoring of model accuracy, relevance, and business impact. 🔗 https://lnkd.in/dA6zEGuS 🔑 Key Message Summary Effective GenAI ROI frameworks combine technical performance metrics with business impact indicators. Leading approaches include tracking cost savings, productivity gains, time-to-value, and alignment with strategic KPIs. Enterprises that define success upfront and monitor outcomes continuously are more likely to scale GenAI successfully. --- The direction taken seems to be well-intentioned. However, the measure of success is not quite what might lead to real solid business outcomes! Individual productivity improvements are just that! They don't scale across the organization unless "vertically scaled" top-to-down an entire process delivering bottomline improvements, which then need to be further "horizontally scaled" end-to-end across the entire value chain of the firm to deliver topline value! My forthcoming book on Cognitive Chasm provides actionable guidance to practitioners on this.

CMOs want pipeline. CFOs want unit economics. Marketers tend to segment with metrics like customer count, ACV, or win rate. These are good at first. But they’re incomplete. The next level is to segment like a CFO Customer Lifetime Value (CLV) is a great bridge. CLV doesn’t just measure deal size or ease of closing. It captures *the full value* of a customer or segment over time: initial purchase, gross margin, retention, and expansion. It’s a great metric to tie marketing strategy to business outcomes. Here's an example... Which customer would you rather acquire? Customer A - $120K ACV. - Closed in 60 days - Costs $60K/yr to serve. - Churns in year 2. Customer B - $60K ACV. - Closed in 90 days - Costs $20K/yr to serve. - Expands in year 2 to $80K. - Expands in year 3 to $100K. Clearly B is more valuable in the long-term. The 5-year value (CLV) is ~6x higher. But a lot of times this dynamic gets missed when thinking about ICPs and segments because we stop with pipeline metrics. CLV helps divide your market by long-term value. This is especially key in an ABM motion where you are making big investments into relatively small segments of accounts. You want to spend resources on the accounts that your CFO will love. Want help measuring CLV by segment? DM me. I'm thinking I'd make a template for this during the holidays. #B2B #marketing #sales

I met a sales team that tracks 27 different metrics. But none of them matter. They measure: - Calls made - Emails sent - Meetings booked - Demos delivered - Talk-to-listen ratio - Response time - Pipeline coverage But they all miss the most important number: How often prospects share your content with others. This hit me yesterday. We analyzed our last 200 deals: Won deals: Champion shared content with 5+ stakeholders Lost deals: Champion shared with fewer than 2 people It wasn't about our: - Product demos - Discovery questions - Pricing strategy - Negotiation skills It was about whether our champion could effectively sell for us. Think about your current pipeline: Do you know how many people have seen your proposal? Do you know which slides your champion shared internally? Do you know who viewed your pricing? Most sales leaders have no idea. They're optimizing metrics that don't drive decisions. Look at your CRM right now. I bet it tracks: ✅ When YOU last emailed a prospect ❌ When THEY last shared your content ✅ How many calls YOU made ❌ How many stakeholders viewed your materials ✅ When YOU sent a proposal ❌ How much time they spent reviewing it We've built dashboards to measure everything except what actually matters. The real sales metric that predicts closed deals: Internal Sharing Velocity (ISV) How quickly and widely your champion distributes your content to other stakeholders. High ISV = Deals close Low ISV = Deals stall We completely rebuilt our sales process around this insight: - Redesigned all content to be shareable, not just readable - Created spaces where champions could easily distribute information - Built analytics to measure exactly who engaged with what - Trained reps to optimize for sharing, not for responses Result? Win rates up 35%. Sales cycles shortened by 42%. Forecasting accuracy improved by 60%. Stop obsessing over your activity metrics. Start measuring how effectively your champions sell for you. If your CRM can't tell you how often your content is shared internally, you're operating in the dark. And that's why your forecasts are always wrong. Your move.

GCC Leaders: Are You Measuring What Truly Matters? To measure the real impact of your Global Capability Center (GCC), you must go beyond traditional operational KPIs like cost savings or headcount. Those are hygiene. What truly matters is how your GCC moves the needle for the business. Here are 5 strategic metrics every GCC leader should track: 1. Value Delivered per Dollar Spent Why it matters: Shows how effectively the GCC converts investment into business outcomes. How to measure: • Business value (e.g., product revenue, productivity gains, IP created) / Total GCC cost • Can be benchmarked against alternative models (outsourcing, onshore) 2. Time to Market Acceleration Why it matters: Reflects the GCC’s ability to improve speed of execution for product development, support, or operations. How to measure: • % improvement in release velocity or cycle times after GCC involvement • Lead time from idea to launch before vs. after GCC enablement 3. Innovation Output Why it matters: Indicates contribution toward competitive advantage and future growth. How to measure: • Patents filed, features launched, automation use cases deployed • Number of AI/GenAI initiatives incubated and scaled • New product ideas or MVPs driven from GCC 4. Business Function Ownership & Accountability Why it matters: Measures the maturity and strategic importance of the GCC. How to measure: • % of global business function fully owned or co-owned by GCC (e.g., platforms, support functions, analytics COEs) • Strategic roles (Directors, VPs) based in the GCC • Participation in global decision-making forums 5. Customer or Stakeholder NPS / Satisfaction Score Why it matters: This metric reflects how well the GCC is delivering value—both through the products it helps build and the support it provides to global stakeholders. How to measure: • NPS from external customers using products or services developed by GCC teams • NPS from internal stakeholders on the GCC’s responsiveness, collaboration, and strategic alignment • Qualitative feedback on product quality, innovation, speed of execution, and business understanding If your GCC isn’t driving the business forward, it’s just another offshore team. And in 2025, that’s not enough. Rethink how you measure. Reframe how you lead. Redefine what your GCC stands for. Zinnov Amita Goyal Karthik Padmanabhan Amaresh N. Mohammed Faraz Khan Namita Adavi Dipanwita Ghosh Sagar Kulkarni Hani Mukhey ieswariya Rohit Nair Komal Shah Saurabh Mehta

The Two Types of Metrics Every Business Needs 📊 Every founder I work with eventually hits the same wall. They're drowning in data but starving for insights. Spreadsheets full of numbers that don't connect to any clear action plan. The problem isn't tracking the wrong things, it's mixing up two completely different purposes for metrics. While many of these metrics overlap (because good business metrics are good business metrics), I've organized them by their PRIMARY focus during fundraising vs daily operations. Think of it as two different lenses for viewing the same business. ➡️ VENTURE CAPITAL METRICS These tell a story of scale, momentum, and market opportunity. ARR and MRR show recurring revenue strength that investors love because it means predictable income streams. Growth rate demonstrates month over month momentum and shows investors you're accelerating, not just maintaining. Burn rate and runway answer the critical investor question: "How long will my money last?" CAC and LTV prove your unit economics work at scale and show whether more marketing spend will generate returns. Revenue multiples help investors benchmark your valuation against comparable companies. Churn rate reveals retention risk and tells investors whether you have a leaky bucket problem. Market size using TAM, SAM, and SOM shows this is a billion dollar opportunity, not just a nice business. Logo count provides social proof that other smart people believe in your solution enough to pay for it. ➡️ OPERATING METRICS These power decisions, accountability, and optimization. Active users, DAUs, and MAUs reveal real product usage patterns and tell you if people find value in what you've built. Conversion rates expose exactly where prospects drop off so you know where to focus optimization efforts. Sales pipeline health compares forecasted deals against closed deals, helping you predict revenue and spot problems early. Gross margin shows profitability of your core product after direct costs. Headcount and hiring plans manage your biggest expense category since most companies spend 60-70% on people. Support tickets and NPS scores measure customer satisfaction and predict churn before it happens. Product engagement reveals which features customers actually use, helping you prioritize development resources. Unit economics breaks down real cost vs return per customer segment for optimized marketing spend. === The best founders track both sets religiously. Use your operating metrics to build compelling investor stories, and let investor feedback guide your operational focus. What metrics are you tracking that I missed?

$7M CEO: “we’re not hitting revenue targets.” me: “are your GTM teams aligned?” $7M CEO: “i think so…everyone’s working hard.” me: “sure, but are they solving the same problem?” $7M CEO: “honestly? i’m not sure.” me: “here’s where I’d start:” 1. ask the 8 questions (as a team) not in silos. not in strategy docs, no one reads. - who is your most relevant customer right now? - what GTM motions are working and why? - where can you grow the most? - what’s the ROI in the customer’s mind? if your team answers differently, that’s your problem. 2. align your leadership before your plan misalignment at the top multiplies everywhere else. - get the CEO, CMO, CS, product in the same room - map the current GTM on one slide - highlight where you’re out of sync (messaging, metrics, motions) GTM isn’t a playbook. it’s a leadership rhythm. 3. focus on fixing the system, not the function most teams try to fix GTM by fixing people. - fire the CRO - hire a new head of marketing - shift messaging mid-quarter but the system is what breaks, not the individuals. fix the structure, the sequencing, and the clarity. 4. run GTM like a system, not a reaction once you’re aligned, build the rhythm. - weekly GTM reviews with the full exec team - scorecards tied to motions and outcomes - iterate based on what the system tells you clarity > certainty alignment > being right systems > goals start with clarity. fix the system. then scale. p.s. follow Sangram Vajre for more insights on fixing your GTM and building something that actually scales.

I wish someone taught me this in my first year as a PM. It would’ve saved years of chasing the wrong goals and wasting my team's time: "Choosing the right metric is more important than choosing the right feature." Here are 4 metrics mistakes even billion-dollar companies have made and what to do instead with Ron Kohavi: 1. Vanity Metrics They look good. Until they don’t. A social platform he worked with kept showing rising page views… While revenue quietly declined. The dashboard looked great. The business? Not so much. Always track active usage tied to user value, not surface-level vanity. 2. Insensitive Metrics They move too slowly to be useful. At Microsoft, Ronny Kohavi’s team tried using LTV in experiments. but saw zero significant movement for over 9 months. The problem is you can’t build momentum on data that’s stuck in the future. So, use proxy metrics that respond faster but still reflect long-term value. 3. Lagging Indicators They confirm success after it’s too late to act. At a subscription company, churn finally spiked… but by then, 30% of impacted users were already gone. Great for storytelling but let's be honest, it's useless for decision-making. You can solve it by pairing lagging indicators with predictive signals. (Things you can act on now.) 4. Misaligned Incentives They push teams in the wrong direction. One media outlet optimized for clicks and everything was looking good until it wasn't. They watched their trust drop as clickbait headlines took over. The metric had worked. They might had "more MRR". But the product suffered in the long run. It's cliche but use metrics that align user value with business success. Because Here's The Real Cost of Bad Metrics - 80% of team energy wasted optimizing what doesn’t matter - Companies with mature metrics see 3–4× stronger alignment between experiments and outcomes - High-performing teams run more tests but measure fewer, better things Before you trust any metric, ask: - Can it detect meaningful change in faster? - Does it map to real user or business value? - Is it sensitive enough for experimentation? - Can my team interpret and act on it? - Does it balance short-term momentum and long-term goals? If the answer is no, it’s not a metric worth using. — If you liked this, you’ll love the deep dive: https://lnkd.in/ea8sWSsS