Measure What Matters

Most business owners think they’re managing performance. They’re not—they’re reacting to results. Revenue, profit, and cash flow are outcomes. They tell you what already happened—not what will happen next. That’s the problem.

Profit Is a Result

Profit is not a goal—it’s a result. It is created by a set of repeatable activities performed consistently over time. Yet most businesses don’t manage those activities. They manage the numbers that show up after the fact.

Your income statement tells you what happened. It does not tell you what to do next.

This Isn’t a New Idea

The idea that performance must be measured to be managed isn’t new. From Drucker’s Management by Objectives to Kaplan and Norton’s Balanced Scorecard, and more recently Doerr’s OKR framework, leading thinkers have reinforced the same principle:

Without measurable activities, execution breaks down. Nowhere is this more obvious than in sports.

What Sports Teach Us About Performance

In every sport, the scoreboard is a lagging indicator.

Sport	Lagging Result (Outcome)	Leading Indicator (KPI)	What It Really Measures	Why It Wins
🏒 Hockey	Win the game	Shots on Goal	Offensive pressure & puck control	More pressure = more scoring opportunities
⛳ Golf	Lower Score	Greens in Regulation (GIR)	Approach shot consistency	More greens = fewer strokes
🏈 Football	Win the game	Turnover Differential	Ball security & defensive disruption	Extra possessions drive wins
⚾ Baseball	Win the game	On-Base Percentage (OBP)	Ability to create base runners	You can’t score without runners
🏀 Basketball	Win the game	Effective FG% (eFG%)	Shot quality & efficiency	Better shots outperform volume

The best teams don’t manage the score—they manage the few activities that make the score inevitable.

The Gap in Business

Canadian data tells a consistent story. BDC research shows many small businesses lack formal performance measurement systems. Statistics Canada has found that firms using structured management practices consistently outperform those that do not. At the same time, RBC data suggests most owners remain focused on revenue, costs, and cash flow—important metrics but ultimately lagging indicators.

The issue isn’t effort. It’s measurement.

Why Business Owners Don’t Measure

In my experience, most business owners don’t avoid measurement because they disagree with it—they avoid it because it feels unclear or complex.

Common challenges include:

• They don’t know what to measure
• They don’t have clear outcomes
• They can’t link activities to results
• They overcomplicate the problem
• They lack a simple system to track it

So, they default to what’s easy: reviewing financials and reacting.

A Simple Example

Let’s say you’re introducing a new product or service. Let’s call it Product X. You’ve done the work—market research, pricing, materials. Now you need traction.

One way to generate it is by calling your existing customers. Instead of tracking revenue first, track the activity:

• Set a weekly target (e.g., 10 conversations about Product X.)
• Record how many Product X calls made
• Review the number weekly
• Adjust as needed

At the same time, track the results separately in your financials. Your income statement shows the outcome. Your activity scorecard shows the behaviour driving it.

The Scorecard

If you want to manage performance, you need a simple system. A basic scorecard will do:

• Track weekly activity (not monthly results)
• Focus on a small number of key actions
• Set clear targets
• Review consistently

Over time, patterns emerge. You’ll see what moves the business—and what doesn’t. Here is how I set up the metric for introducing Product X.

What To Do Next

If you want to apply this through a project-based engagement:

• Identify one or two key issues in your business
• Define the outcome you want
• Determine the activity that would drive that outcome
• Set a weekly target
• Track it consistently

That’s it.

Final Thought

If you can’t clearly define your “shots on goal,” you’re not managing your business—you’re reacting to it. And over time, reaction is what kills performance.