A north star metric captures the core value a product delivers — such as weekly active teams or orders delivered. A metric tree breaks it into drivers.
Choosing a North Star
It should:
- Reflect customer value, not just revenue.
- Predict long-term success.
- Be understandable and measurable.
Building a Metric Tree
Decompose the north star into components:
- Revenue = customers × orders per customer × average order value.
- Each component breaks down further, down to metrics individual teams influence.
Benefits
- Shows how each team's work connects to company goals.
- Helps diagnose changes: which branch moved?
- Guides prioritisation.
Guardrail Metrics
Pair growth metrics with guardrails — quality, satisfaction, costs — to avoid gaming.
Pitfalls
- Metrics that are easy to game.
- Trees that assume independence when drivers interact.
- Too many metrics without clear ownership.
Review
Revisit the tree as the business changes.