The operator lexicon
Field Guide
The numbers that actually run a business, defined properly: what each one is, how to calculate it, what good looks like, and the mistake almost everyone makes. For the longer answers, see Ideas.
Labor and Capacity
What the team costs, what it produces, and the gap between the two.
Atomic Unit
An Atomic Unit is a standardized block of work, two hours long, used as a fixed denominator for measuring output independently of who does the work or what tools they use.
Direct Labor
Direct labor is the salary cost of the employees who directly produce the work a business sells. It excludes contractors, administrative staff, payroll taxes, and benefits.
Labor Effectiveness Ratio (LER)
The Labor Effectiveness Ratio is gross profit divided by direct labor cost. It answers one question: is your team producing more value than it costs?
Salary Cap
The Salary Cap is the maximum total labor spend a business can carry while still producing acceptable profit, including a market-rate salary for the owner.
Velocity
Velocity is estimated Atomic Units divided by actual Atomic Units consumed. It measures how effectively a person, team, or firm converts standard work into finished output.
Cash
How much time the business actually has, measured in days.
Practice
How the numbers actually get run, and what it looks like when the running is theater.
Financial Theater
Financial theater is the production of reports, dashboards, and financial activity that creates the appearance of visibility without producing a decision.
SPOT Dashboard™
The SPOT Dashboard™ is the one page a business runs on: 5 to 10 numbers, chosen so an operator can decide without opening anything else. SPOT stands for Single Pane Of Truth.
Every term here belongs to a discipline of the MEASURE × HACK™ Method.
The Field Guide is the operator half: the business numbers and what to do about them. The Method they come from, which covers a good deal more than the business, lives on measurexhack.co.