Our leadership team cannot agree on whether Scorecard targets should represent minimum acceptable performance floors or aspirational stretch goals. What standard should we use to establish the weekly target?

Question

Tyler Smith · Accepted Answer

Scorecard targets must always represent minimum acceptable performance floors, never aspirational stretch goals. Confusing a weekly Scorecard with an aspirational bonus scorecard or an annual vision board destroys the core function of the Data Component in EOS.

The Scorecard is an operational pulse. Its sole purpose is to tell the leadership team whether the business is healthy and on track to hit its annual plan and quarterly Rocks. If you set targets as aggressive stretch goals, your Scorecard will be covered in red every week. When everything is red, two destructive things happen:

- Your team develops red fatigue. Leaders become numb to missed targets, stop investigating root causes, and accept substandard output as normal.
- You lose your early warning system. You cannot distinguish between a catastrophic operational failure and a near-miss on an unrealistic stretch target during the Level 10 Meeting.

A Scorecard target should represent the exact weekly operational run rate required to achieve your business plan. If your company needs forty new customer appointments a month to hit its revenue goal, the weekly target is ten. Ten is the floor. If you hit nine, that is an operational issue that demands immediate IDS.

Save stretch goals and aspirational visions for your V/TO. In your weekly Level 10 Meeting, you need cold, unyielding reality. When a box turns red, it must signal that the company is falling behind the baseline required to survive and grow.