Metric Tree Design - Deconstructing Your North Star Metric into its Key Components

One approach that we often take, and it's not the only approach, is to build backwards. So if we're thinking about a metric tree, the first thing we want to do, and I'll just use a sticky note here on the canvas, is just decide what that North Star metric is. What is that number that we care about? It has to be a number that you want to understand, and that you want to be able to improve. This could be at an organizational level. So for our example, we're going to be looking at revenue. We think it's fairly universal across a lot of organizations, but it doesn't need to be across the organization. This could be, at a department level. It could be at a project level. Whilst Ollie mentioned before about the the clutter of dashboards, we rarely it's it's not that you just need one metric tree per organization. We can think strategically, like, about having a small suite of them that covers your organizational metrics, your departmental ones. And then what comes next? It's just breaking this down. Like, we need to decompose this metric. So we can start to do that by just think about, like, what does our revenue, What's it made up of? It's new it's made up of new business. It's made up of expansion, and it's made up of churn. And we can keep going like this. So we start to suddenly see the next level of our metric tree, and then we just go again. Like, what makes churn? What how can we break that down? How can we break down new business? And the idea is that the lower you get in your tree, the the more likely it's more likely that you're gonna be able to influence that metric. And that's where you wanna be. You want to be able to have a suite of metrics that you can influence that then the effect of which will ripple up and affect the North Star metric that you care about. That's right. You wanna go from sort of leading metrics, things you can influence, and then as you got the tree, they start becoming the outcome.