---
title: Operating Reviews and Performance Management
summary: Install the cadence that runs your systems weekly, monthly, quarterly, and annually so the business runs itself.
est_minutes: 18
sort: 7
---

Welcome to Module 3.7, the final module of Pillar 3.

You've documented systems, designed an org, built financial visibility, audited tech, and installed meetings. The last piece is the cadence that runs all of it. Without the cadence, everything you built decays.

By the end of this module you'll have a KPI dashboard, a complete 4-cadence Operating Review System, a performance management approach, and a compensation review standard. After this module, the business runs.

**What An Operating Review System Is**

An Operating Review System is the heartbeat of a real business.

It's not "we meet sometimes and look at numbers." It's a documented cadence, 4 layered reviews each producing specific outputs, that catches issues early, makes decisions on time, and keeps every system you built in Pillars 1 to 3 alive.

The 4 layers:

1. **Weekly Review** — short, tactical, KPI-driven
2. **Monthly Operating Review (MOR)** — financial + operational
3. **Quarterly Business Review (QBR)** — strategic + planning
4. **Annual Operating Plan** — full-year roadmap, budget, hiring

Each review has fixed attendees, fixed agenda, fixed outputs. Together they form a system. Skipping a layer breaks the system.

**The KPI Dashboard**

Every operator business needs 8 to 12 numbers it tracks weekly. Not 50. Not 3. Eight to twelve.

The right KPIs for most operator businesses:

**Revenue side (4):**
- MRR (monthly recurring revenue)
- New deal count + value (last week)
- Pipeline value
- Monthly churn rate

**Delivery side (3):**
- Customers in onboarding (count + status)
- NPS / satisfaction score (rolling)
- Renewal rate (last 90 days)

**Finance side (2):**
- Cash balance + 4-week forecast
- Gross margin (last month)

**People side (2):**
- Open roles + days open
- Top-20 customer Health Score (count Green/Yellow/Red)

**Operator side (1):**
- Founder calendar distribution (% Strategic vs Reactive)

That's 12 KPIs. They cover Revenue, Delivery, Finance, People, and Operator. Updated weekly. Reviewed in the Weekly Review.

If you can't pull these numbers in 15 minutes, the data infrastructure is broken (revisit Module 3.5 automation roadmap). The whole point is decision-grade visibility on a weekly cadence.

**The Weekly Review**

30 minutes. Friday EOD. Attendees: founder + leads.

Agenda:
1. KPI dashboard (5 min): green/yellow/red at a glance
2. Last week's top 3 priorities, done? Why/why not? (10 min)
3. This week's top 3 priorities (5 min)
4. Blockers from leads (5 min)
5. Cash forecast walkthrough (5 min)

Output: a 1-paragraph weekly summary sent to the team Friday EOD.

Purpose: catch issues weekly, not at month-end. By the time month-end arrives, weekly reviews should have already surfaced every important issue.

**The Monthly Operating Review**

The MOR from Module 3.4. 90 min on the 5th. Full agenda there.

In the Operating Review System, the MOR is the financial heartbeat. The Weekly reviews are tactical. The MOR is operational. The Quarterly is strategic. The Annual is directional.

Each layer answers a different question:
- Weekly: "Are we on track this week?"
- Monthly: "Are we on track financially this month?"
- Quarterly: "Are we on track for our quarterly goals?"
- Annual: "Are we on track for the year, and where should we be next year?"

Layered reviews make decisions sized to the cadence.

**The Quarterly Business Review**

4 hours, first Friday of the new quarter. Attendees: founder + all leads.

Agenda:

1. Quarterly KPI review, vs plan, last 12 weeks (45 min)
2. OKR setting, 3 OKRs for the next 90 days (45 min)
3. Hiring trigger check, which hires are firing? (30 min)
4. Tech stack quarterly review, kill anything? (30 min)
5. SOP quarterly review, outdated SOPs? new ones needed? (30 min)
6. Customer health portfolio, red customers, action plan (30 min)
7. Decisions + commitments (30 min)

Output: 1-page Quarterly Plan with named OKRs, hires, and key initiatives.

The QBR is where strategy meets reality. Most operators skip it because "we don't have time." That's how businesses drift.

**The Annual Operating Plan**

Once a year. 2 days. Off-site if possible.

The Annual Operating Plan covers:

- **Last year retrospective** — what hit, what missed, what changed
- **Vision update** — where the business is going in 3 years
- **Annual targets** — revenue, customer count, headcount, key initiatives
- **Pillar plan refresh** — Pillars 1 to 4 status, plans for the year
- **Annual budget** — full P&L plan for the year
- **Hiring plan refresh** — quarter-by-quarter
- **Compensation review setup** — who, when, with what data

Output: a 5 to 10 page Annual Operating Plan document.

This is the artifact that drives every decision for 12 months. Without it, decisions drift quarterly.

**Performance Management**

Three components beyond the operating reviews:

**Component 1: Quarterly performance reviews.** Every team member, including yourself. 60-minute structured conversation. Documented in a 1-page summary.

Standard agenda:
- What's gone well last 90 days?
- What's a stretch / what needs to improve?
- What does the person need from the operator / business?
- 3 specific commitments for the next 90 days

Performance reviews are NOT for compensation conversations. Those are separate (next component).

**Component 2: Compensation Review Standard.** Once per year. Based on:
- Performance (from the 4 prior quarterly reviews)
- Market data (research roles)
- Budget (from Annual Operating Plan)

The Standard defines the PROCESS. Specific pay decisions are operator + finance owner. Documented per person, signed.

**Component 3: Documented exit process.** When someone leaves (chosen or otherwise), a documented exit process: knowledge transfer, access removal, customer transitions, post-mortem. Without this, exits are chaos.

**What To Do Right Now**

Five things:

1. **Build your KPI Dashboard.** 8 to 12 numbers. Pull them now. Section A.
2. **Document the Weekly Review.** Day, time, attendees, agenda, owner. Section B.
3. **Tie all 4 cadences into a system document.** Section C.
4. **Adopt the Performance Review template + cadence.** Section D.
5. **Document the Compensation Review Standard.** Section E.

Take the quiz.

Pillar 3 is complete. You've built a documented operating engine. Combined with Pillar 1 (foundations) and Pillar 2 (revenue engine), you have a business that runs whether you're in it or not.

Pillar 4, Scale & Exit, is the final pillar. Where everything you've built either scales beyond you or becomes a sellable asset.

See you there.
