Insights
The KPIs that matter in a turnaround
In a turnaround, the KPIs that matter are cash runway, weekly cash flow, contribution margin, and the fixed cost base, plus two or three leading indicators tied to the recovery plan. Everything else is noise until the business is stable.
In short
In a turnaround, the KPIs that matter are cash runway, weekly cash flow, contribution margin, and the fixed cost base, plus two or three leading indicators tied to the recovery plan. Everything else is noise until the business is stable.
Cash first, always
The primary KPI is runway: the number of weeks of cash available. Until this is under control, other metrics are irrelevant. Weekly cash flow forecasting replaces monthly reporting because the timeframe demands higher cadence.
Margin and cost base
Next are contribution margin and the fixed cost base. A turnaround typically involves restoring margin and resetting fixed costs to a level supported by current revenue, rather than pursuing topline growth prematurely.
A few leading indicators
Beyond financials, select two or three leading indicators directly linked to the recovery plan. Examples include pipeline velocity, churn rate, or on-time delivery. Track these weekly and disregard other metrics until stability is achieved.
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Frequently asked questions
How often should turnaround KPIs be reviewed?
Weekly at minimum for cash. Often more frequently during the initial stabilization phase.
What is the single most important KPI?
Cash runway. Until cash is under control, every other metric is secondary.
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