The 5-Metric Scorecard for Small Business Stability
You do not need a complex dashboard to know if the business is stable. Five well-chosen metrics can tell you whether growth is healthy or fragile. The scorecard is meant to be reviewed weekly in under 10 minutes so it stays alive.
1) Cash runway: How many months of cash you have at current burn. This is your survival meter. If runway drops below two months, every other decision becomes urgent. Pair this with your 13-week cash forecast for early warning.
2) Gross margin: Revenue minus direct delivery costs, expressed as a percentage. Margin is the fuel for reinvestment. If gross margin shrinks, you are working harder for less. Track it monthly and watch for downward drift.
3) On-time delivery rate: The percentage of projects or tasks delivered by the promised date. This is the simplest indicator of operational health. If on-time delivery falls, customer satisfaction and referrals will follow.
4) Net revenue retention: The percentage of revenue retained after churn and expansion. This tells you whether the customer base is growing or leaking. High NRR creates compounding growth without constant acquisition.
5) Pipeline coverage: The value of qualified pipeline relative to next month's revenue target. A simple rule: 3x coverage for short sales cycles, 5x for longer ones. If coverage is low, revenue will become volatile.
Make the scorecard visible. Put it in a shared doc or a dashboard that leadership can see weekly. Assign an owner for each metric so updates are reliable and there is no debate about numbers.
Use the scorecard to drive action. If runway is low, run a collections sprint. If margin drops, review pricing and scope. If on-time delivery slips, adjust capacity. The scorecard is not a report; it is a trigger for decisions.
Finally, keep the scorecard consistent for at least a quarter. Metrics need time to show trends. Once the rhythm is established, you can add one or two supporting metrics, but keep the core five stable so the team can compare month to month.
Stability is not luck. It is the result of monitoring the right signals and acting early. A five-metric scorecard gives you that early warning without drowning you in data.