Sometimes our choices are obvious, most times they’re not.

Fred Gunter introduced me to mountain climbing in 1977, before it blossomed into the sport it is today.  At the time there was limited gear and no fashionable outfits.  We were just a gnarly group of guys and a few intrepid women gathering in the woods to exorcise our fears and discover exhilaration in the process.

Fred was there to test equipment and develop his skills as a guide and instructor having just opened a trekking store in Greensburg, PA called Exkursion.  Over the years he would lead many of us on adventures into exotic locations and primitive conditions to be one with the rock.

What I didn’t realize then was the fundamental truth about business strategy embedded in the practice of climbing.  I never asked Fred if the lessons he learned in those early days informed his decision-making later as big-box retailers threatened his small family business.  I cannot imagine that they didn’t.

In business, as is true at the base of a mountain, we have before us a set of facts, call it the current situation.  We read the current situation as best we can and form our plans based on what we see as well as our overall objective.  If you’re responsible for setting up base camp, you might be assessing the slope of the land (water runoff) or the rock-free spaces (sleeping comfort) or proximity to privacy (latrines), but you are taking stock of the facts as you see them and processing what you have to work with, the current situation.

If you’re preparing to lead the ascent, you too are taking stock with your team of possible routes to choose from.  Depending on your objective, you might take one with a high degree of difficulty to be challenged or conversely, you want to simply select a safe route to claim the summit.  Whichever route you choose, along the way your assumptions will be tested and you’ll be faced with the choice of pushing on in spite of what you’ve learned or reassessing because of it.

The hypotheses we develop around the businesses we run are no different.  Our markets are dynamic.  The need to test assumptions is ever-present. The opportunity to learn and succeed, or ignore and fail, is a capacity we all have.  As leaders we must cultivate the former if we are to position our companies for a successful exit or to be one day led by the next generation.

So, how do we do that?  We like to use the Balance Scorecard developed by Drs. Kaplan and Norton from Harvard. It is a highly effective tool, simultaneously simple and sophisticated. One important component of the scorecard are the measures we establish to mark progress towards specific objectives.  The measures can be predictive of success (leading indicators) and confirming (lagging indicators) or they can be completely wrong.  They are, after all, our best guesses as to whether they measure the cause and effect relationships between the outcomes we want (objectives) and the things we assume will lead to those outcomes (tactics).

Data is critical, whether you’re climbing a rock face or building the next Google.  Pay attention to it and improve the probability of making it safely to the top!