Data Doesn’t Lie. Execs Do.
Data is your most reliable ally. Data don’t lie. They are open to interpretation but they inherently can’t twist narratives or sugarcoat reality. Executives, on the other hand, are human. They are compelled to explain numbers. This isn’t deceitful in the least – it’s a natural human response to seek understanding and validation. In general, though, it’ll skew the decision you have to make. As a rule people will explain the data in the best light. What you want to do is remove that light and directly engage with the data, alongside your executive team, to foster transparency and accountability.
The Executive Spin: A Natural Phenomenon
When faced with underperformance, which will happen, executives, rightly, want to explain what has occurred. They want to provide context – generally that mitigates the gravity of the situation. “We know why we missed this quarter”, “we’re spinning up new reps”, “we don’t have the right product market fit in that segment.” This is not, generally, malicious. It’s a basic human instinct. You’re wired to protect how you think about yourself. You’re wired to assure stakeholders that the ship is still on course. Problem is most of the times those narratives are distortive and keep you from grappling with the core reality of a situation. As a CEO your job is to cut through these narratives and ensure action is based on unvarnished truth.
The Only Fix: Direct Inspection
The only proven solution I’ve found here is directly inspecting data against a pre-agreed benchmark of success. This approach transforms discussions from subjective narratives to objective analyses. By establishing these benchmarks, you foster a culture of accountability. You can skip lots of pre-loaded explanations and, sometimes, make progress on real fixes.
Reasonable and Peer Benchmarks
A direct inspection model is scored or judged against reasonable and peer benchmarks: Benchmarks provide a clear scorecard to measure performance. They should be based on reasonable, peer data. Peer means companies of similar size and operational maturity. You are. not to a late-stage, publicly traded SaaS giant. Peers are those in a similar stage of growth and operational maturity. Reasonable means throughout the outliers and focus on median performance. Yes, I know you think you’re exceptional. So do the other 30,000 SaaS CEOs out there. They’re all smart. They’re all hungry. If you can objectively perform at a median level consistently as you grow you’ll be a billionaire.
A Clear, Basic Scorecard
Ultimately, the goal is to have a straightforward scorecard to regularly inspect results directly from your systems of record. This clarity empowers you to make informed decisions that drive predictable and scalable growth. What you inspect is ultimately based on how you want to grow. If our strategy is directly acquiring new customers we should have a bunch of benchmark data for that we inspect against. If it’s a channel strategy, channel KPIs it is. The key thing is reasonable and peer based objectives..
If you do that repeatedly you’ll create a data-driven culture where transparency and accountability naturally result. People will get the message that you want data, not narratives first. Once you’ve got the data then we can interpret it together. By doing so, you not only prevent the distortion of narratives but also pave the way for your company to achieve its growth ambitions.