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Once Again On Metrics, KPIs and Fitness for Purpose

Folks, once again, about metrics and KPIs… Partly personal, partly business, focusing on business.

The book Fit-for-Purpose derives several business lessons from the world of sports. It shows examples of how athletes and teams track many statistics about their performance condition. How fans and coaches attach emotionally to metrics like hitting streaks and pass completion. And yet how they never lose sight of the few key numbers that truly indicate their performance, such as finish times and games’ final scores.

Continuing this theme today thanks to a recent experience, translating what’s obvious in sports into less obvious lessons for business.

Here are some metrics: distance, average speed, average pace, stroke rate, distance per stroke, Swolf (that’s seconds plus strokes per 25 metres). These metrics are all relevant to the sport of swimming. None of them is a Key Performance Indicator. What’s a Key Performance Indicator, then?

Making the cut at the swim stage.

It makes the big difference between continuing the race, finishing it, having an actual finish time you can call your personal best, all that – and the dreaded DNF (Did Not Finish).

Less of this

This is a big problem for competitors like me, who are runners first, ride their bikes for cross-training, and swim during beach vacations. I’ve been working on my swimming for months, but this was still going to be tough. Fortunately, the organizers of this small-town race, perhaps for simplicity, opted for a single cutoff point midway through the bike course.

More of this

The time on the clock when I would reach this midway point was my Key Performance Indicator. With a very clear threshold. How I measured up against this KPI depended not so much on the bike, but on the slow swim and the first-timer’s first transition. Therefore, my training strategy in the months before the race was to allocate more of my training volume towards swimming, necessarily limiting my bike and running distances.

I also had a tactical move available to me on the race day. I had to drop the usual approaches like maximizing the average speed over the bike course or riding with the optimal speed saving legs for the run. As I took less than straight path between buoys against the current, I realized what I had to do once I got out of the water.

I had to go all out on the first bike lap.

After I met my KPI (with less than two minutes to spare), the rest of the way was fun because I knew I was going to finish the race. It didn’t subtract from my happiness that I faded slightly on the second bike lap or that my legs felt slightly off at the start of the run. (I rehearsed this exact situation many times in training, hence my basis for comparison.) My bike tactic cost me about two minutes of the finish time. That was a small price to pay for finishing.

Now let’s reiterate, with the help of this example, the same lessons for business.

· Key Performance Indicators (KPIs) are key and, therefore, few

· The key indicators aren’t always obvious. You have to know your market, your customers, understand their criteria, by which they find your products or services fit, instead of your competitors’ or something else entirely, and the thresholds for those criteria

· If you identify your KPIs as fitness criteria, here’s what happens when you game them: you only assure the important outcomes you wanted all along

· Such KPIs may not be among the multitude of metrics you know in your familiar business domain and are tracking already

· Fitness criteria lead to simple decision filters. At each decision point, big or small, strategic, tactical, planning, or operational, ask: does this option make us fitter by this criterion?

· The many metrics you’re already tracking in your business domain may be very good health indicators. It’s important to know their healthy ranges. Going outside the range may be an early warning indicator that you may be off course to meet your fitness criteria and, consequently, attain your outcomes

· As useful as health indicators may be, it’s important not to use them for motivation or rewards. (Sports analogy: it’s the finish time that matters. There’s no prize for Swolf, wattage or VO2Max.)

· Health indicators that are currently outside their healthy range point to potential improvements. (Sports analogy: most of my swimming metrics.) We can set temporary improvement targets, with the understanding how they impact our performance with respect to our fitness criteria (KPIs) and thresholds. We can see if what we’re trying to do is getting us closer to attaining the given performance level.

And maybe one more. Triathlon isn’t about just covering distances. The point is the joy of movement in three different environments, exploring them and discovering yourself in the process. Serious amateur triathletes can spend huge sums of money on their equipment, gear, and travel. I entered this sport with my running kit and a Canadian Tire commuter bike (I do have a nice sports watch that costs more than this bike). The more advanced equipment wasn’t going to make me fitter by the known criterion -- indicator of performance. What was going to help and what helped was simply getting into the water multiple times a week and gradually increasing the effort.

The carbon bike on the right makes another competitor faster -- and fitter. It could make me a bit faster, but not fitter. To be fitter, I needed my old horse -- and something else, entirely outside the sport of cycling!

In sports as in business, you find your rewards not by doing what others are doing, but by seeking your own path, doing your own thing – and putting it up, every now and then, against a fitness test.

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