Performance Intelligence

The KPIs that change decisions

Twelve measures that show how a practice is really performing, what each one reveals, and what it quietly hides.

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Profitability metrics

Profitability

Whether the work being won is actually worth doing, once the cost of delivering it is accounted for.

Salary Multiple

Revenue compared with the salary cost of the people doing the work. It is a simple, long-standing test of whether a people-based business is pricing and staffing its work to make a sustainable profit.

Effective Hourly Rate

The fee actually earned for each hour spent, once overruns, revisions and unbilled time are counted. It is often well below the rate on the price list, and shows exactly which work is worth doing.

Realisation Rate

The share of recorded billable time that turns into fees. A team can be fully utilised and still underpaid, if much of that time is written off, discounted or absorbed into fixed fees that were set too low.

Client Profitability

The profit each client produces once the full cost of serving them is counted. It regularly shows that a small number of clients generate most of the profit, while others cost more to serve than they pay.

Contribution Margin

What each service, client or product leaves behind once the costs that rise and fall with it are taken out. It shows which parts of the business are carrying the overheads, and which are quietly being carried.

Gross Service Margin

What remains once the cost of delivering the work is taken out. If this margin is thin, no amount of overhead control will fix it, because the problem sits in how work is priced and resourced.

Revenue Per Employee

A plain test of whether added headcount is producing added value. If revenue rises while this figure falls, the business is getting bigger without getting stronger.

Average Fee Per Project

Not all revenue carries the same value. A higher fee project may still produce weak returns if it demands too much time or senior attention. Looking only at revenue can hide this.

Project Profit Margin

A practice can be busy, win awards and still be earning far less than it should. If project margins are not clear, leaders may continue taking on work that looks attractive on the surface but quietly weakens the practice financially.

CAPACITY & DELIVERY metrics

Capacity & Delivery

Whether the team can carry the work it has taken on, and what it costs when the plan and the reality drift apart.

Capacity Planning

Knowing what the team can realistically deliver before committing to it. Without a forward view, work is either turned away that could have been won, or accepted at a cost to everything already in progress.

Studio Utilisation Rate

Utilisation affects profitability more than many studio leaders realise. If utilisation is too low, salary cost erodes profit. If it is too high for too long, quality, morale and delivery begin to suffer.

Growth and risk metrics

Growth & Risk

What the months ahead are likely to hold, and how exposed the practice is if one part of the picture changes.

Recurring Revenue Percentage

The share of revenue that comes from contracts, retainers or subscriptions rather than one-off work. The higher it is, the more predictable the business, and the more it is worth.

Net Revenue Retention

The revenue this year from last year's customers, including upgrades, price rises, downgrades and cancellations. Above 100% means the existing customer base grows on its own.

LTV to CAC Ratio

The value a customer generates over the whole relationship, compared with the cost of winning them. It is one of the clearest tests of whether a business's growth is building value or burning it.

Customer Acquisition Cost

The full cost of winning one new customer, and the number of months of margin it takes to recover it. Growth only creates value when customers repay the cost of winning them, and do so quickly.

Win Rate

The share of proposals and qualified opportunities that turn into signed work. It shows how effective the sales process is, and makes the pipeline far more useful for planning.

Pipeline Value

The weighted value of work still to be won, set against what the business needs to win. Pipeline judged on volume alone tends to flatter, because it rarely accounts for how likely, or how soon, the work will convert.

Forecast Accuracy

How closely earlier forecasts matched what actually happened. A forecast that is consistently wrong in the same direction is more useful than it first appears, because the bias can be corrected for.

Find out what your numbers are actually telling you

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