Choose Metrics that TRULY Matter: Discover the secret to strategic alignment!

Miles Everson • August 12, 2025

From the desk of Miles Everson:

come to “Return Driven Strategy (RDS)!”

I hope you’re having a great day so far.

For those of you who don’t know yet, RDS is a pyramid-shaped framework with 11 tenets and 3 foundations. When applied properly, these principles help businesses achieve their organizational objectives.

Are you ready for today’s topic?

Continue reading below to know more about various strategic performance measures for success.




Choose Metrics that TRULY Matter: Discover the secret to strategic alignment!

Imagine walking into a maze with no map, no signs, and no clear destination.

Frustrating, isn’t it?

That’s what it feels like to be part of an organization where the strategy is unclear or poorly communicated. After all, success doesn’t happen by accident—it’s the result of deliberate, well-communicated, and well-executed plans.

The thing is, many organizations struggle to effectively communicate their strategy to their employees, leaving them wandering aimlessly without a clear sense of purpose.

The Problem with Vague Strategy Statements

According to Professor Joel Litman and Dr. Mark L. Frigo in the book, “Driven,” organizations often rely on ambiguous statements like, “we seek profitable growth” to define their strategy.

While these phrases sound impressive, they fail to provide employees with actionable insights into the company’s goals.

As a result, this disconnect creates confusion and disengagement, as employees are left to guess how their roles contribute to the larger organizational objectives.

That’s why in reality, effective communication of strategy goes beyond buzzwords and generic aspirations. It requires organizations to tailor their approach to different business models and customer needs.

After all, strategies are not static; they evolve with market dynamics, customer expectations, and competitive pressures. With that, the measures used to track progress must also adapt to these changes.

High-performing organizations understand the importance of aligning their competencies with performance measures that drive strategic success. These firms excel at detecting unmet needs in large and growing customer groups, tailoring their activities to address these opportunities.

Michael Porter, a renowned strategist, emphasizes this point:

“Measure how various parts of your value chain actually fit together to lead to an overarching advantage, rather than using process-by-process metrics.”

This holistic approach ensures every aspect of the organization contributes to a cohesive strategy, rather than operating in silos.

The Myth of One-Size-Fits-All Metrics

Professor Litman and Dr. Frigo say there is no universal metric that can address every organizational need. While branded performance measures like net promoter scores (NPS) or balanced scorecards are valuable, their effectiveness still depends on the specific context in which they are applied.

A single metric may work well for resource allocation but fail to provide meaningful insights for executive compensation or business valuation.

So, what is the key?

FLEXIBILITY.

At the end of the day, organizations must design performance metrics that align with their strategy and adapt to the unique demands of different analyses. This ensures decision-making processes are informed by relevant and accurate data.

Picture this: Low-performing organizations often fall into the trap of focusing on metrics before defining their strategy. They ask questions like:

“What should we measure?”

“How should we measure performance here?”

Meanwhile, strategic performance measurement systems, such as the Balanced Scorecard, are fundamentally about implementing strategy.

Such systems teach management that before establishing performance metrics, organizations must ask themselves:

“Have we explicitly defined our strategy and goals?”

“Do we understand the customer objectives, offering creation, and production objectives necessary to achieve our wealth-creation goals?”

This is because without clear answers to these questions, performance measurement systems are likely to become convoluted and ineffective.

The Necessity of Evolving Metrics

According to Professor Litman and Dr. Frigo, one of the most common pitfalls for organizations is clinging to outdated metrics. As strategies change, so too must the measures used to track progress.

The late 1990s serve as a cautionary tale, as industries grappled with disruptive technologies that reshaped business operations and consumer expectations.

Take for example the case of Dell

In its early days, Dell’s strategy prioritized operational efficiency, focusing on metrics such as the cash conversion cycle. This allowed the company to manage inventory effectively and maintain a competitive edge.

However, as customer demands shifted toward innovation and enhanced post-sales service, Dell had to adapt its strategy—and its performance measures—to remain relevant.

See?

Clearly, the path to strategic excellence in today’s dynamic business environment is to prioritize the clear communication of strategy and the alignment of performance measures with strategic goals .

This approach not only empowers employees to contribute meaningfully to organizational success, but also ensures the organization remains agile in the face of change.

The bottom line?

By defining strategy first and tailoring metrics to support it, companies can navigate the complexities of their industries with confidence.

In doing so, they transform vague aspirations into actionable plans, paving the way for sustainable growth and competitive advantage.

We hope you learned a lot from today’s topic!

If you’re looking to gain a better understanding of Return Driven Strategy and Career Driven Strategy, we highly recommend checking out “Driven” by Professor Litman and Dr. Frigo.

Click here to get your copy and learn how this framework can help you in your business strategies and ultimately, in ethically maximizing wealth for your firm

Hope you found this week’s insights interesting and helpful.

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Stay tuned for next Tuesday’s Return Driven Strategy!

Peloton Interactive became synonymous with home fitness during the COVID-19 pandemic.

Learn more about this business case study in next week’s article!

Miles Everson

CEO of MBO Partners and former Global Advisory and Consulting CEO at PwC, Everson has worked with many of the world's largest and most prominent organizations, specializing in executive management. He helps companies balance growth, reduce risk, maximize return, and excel in strategic business priorities.


He is a sought-after public speaker and contributor and has been a case study for success from Harvard Business School.


Everson is a Certified Public Accountant, a member of the American Institute of Certified Public Accountants and Minnesota Society of Certified Public Accountants. He graduated from St. Cloud State University with a B.S. in Accounting.

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