The use of metrics often begins with someone’s assumptions. Whether it is a CEO, a board, a manager, or a lead pastor, the assumptions that provide the basis for chosen metrics are vital to whether or not a start-up is successful.
Assumptions are inevitable. An assumption is a statement that is treated as true for the sake of argument, regardless of whether or not it is actually true. (Hubbard, 2014) Leaders make assumptions all the time and often they use those assumptions for the basis of decision-making, which can prove to be unwise. Leaders have strong feelings they are not always aware of, but many times those strong feelings are based on intuition and are implicit and unexamined. (Pfeffer &Sutton, 1999) When leaders have deeply held assumptions based on strong, but unexamined, beliefs, decisions can be made without the underlying assumptions ever coming to the surface, and create a cycle of unwise decision-making grounded in unproven assumptions. (Pfeffer & Sutton, 1999)
Assumptions are a safe place to start, but it is important to understand that assumptions are usually off-base from where they need to be for organizational success. (Hubbard, 2014) Every qualitative analysis is based on an assumption, (Davenport et al., 2010) however it must move beyond assumption to proper metrics that will inform decisions. Assumptions should first consider the precedent that has been set in the past because precedent embodies unstated, untested assumptions that are carried over to new situations. (Pfeffer & Sutton, 1999) Allowing outside individuals to speak into the assumptions also provides insight that may reveal misguidance in the assumption itself, as it provides the opportunity for interventions allowing decisions to be more mindful based on what people know. (Pfeffer & Sutton, 1999)
Davenport, T. H., Harris, J. G., & Morison, R. (2010). Analytics at work: smarter decisions, better results. Boston, Mass: Harvard Business Press.
Hubbard, D. W. (2014). How to measure anything: finding the value of intangibles in business (Third edition). Hoboken, New Jersey: John Wiley & Sons, Inc.
Pfeffer, J., & Sutton, R. I. (2000). The knowing-doing gap: how smart companies turn knowledge into action. Boston, Mass: Harvard Business School Press.