Titanium Birch measures the performance of the organization, taken as a whole, along the following dimensions (individual performance and compensation are separate topics, addressed in their own specific framework):
- Risk adjusted financial returns. We seek to maximise returns on investment, subject to taking an appropriate level of risk, including preventing our maximum drawdown from exceeding a threshold level, as well as hard limits on losses due to tail events. ****This category is the ultimate end-result. The other categories below support it.
- Operational risk levels. We monitor operational risks, record accumulated problems to identify any systemic issues, and apply lessons learned to processes designed to limit them, including the following:
- Internal and external fraud
- Cybersecurity
- Trading execution mistakes
- Wire transfer mistakes
- Vendors
- Systems risk
- Legal risk
- Reputation. We seek to protect and build equity in the Titanium Birch brand name as perceived by relevant outsiders, including but not limited to portfolio companies, other investors, vendors, staff, candidates, and in some cases also the general public.
- Peter’s satisfaction levels with services provided to them, covering**:**
- Personal administration covering health and travel
- Education
- IT
- Security
- Efficiency of operations:
- Staff engagement (as evidenced by surveys, output, direct interaction)
- Costs across layers (insourced, outsourced, transaction fees, expenses) and compliance with budget
- For each person on the team, time spent on activities appropriate to that individual’s opportunity costs and potential to deploy resources better (via automation, delegation, outsourcing etc)
- Output (completed activities at sufficient quality) within a given period of time
- Results within a given period of time (according to appropriate metrics)
We think of these dimensions as “territory in which we might set ourselves goals.”
See also: goal-setting and mindmap for a hierarchy of the areas of ownership.