Frontier of Understanding (NCTs)

The Frontier of Understanding (NCTs)

"If you don't understand how to move a particular metric, then the right goal is to set a goal to increase your understanding not to move that metric." — Ravi Mehta

What It Is

Instead of blindly focusing on outcomes, teams should identify their "Frontier of Understanding." If the levers are unknown, the goal should be "Understanding Risk" (learning); if known, the goal can be "Execution Risk" (doing) or "Strategic Risk" (outcomes).

When To Use

• Quarterly planning when leadership demands metric increase
• Team has no clear hypothesis on how to achieve
• Avoiding "throwing spaghetti at the wall"
• Setting realistic, achievable goals

The Risk Levels

┌─────────────────────────────────────────────────────────┐
│  UNDERSTANDING RISK                                     │
│  "We don't know the levers"                             │
│  → Goal = Insight / Learning                            │
├─────────────────────────────────────────────────────────┤
│  DEPENDENCY RISK                                        │
│  "We know levers but lack tools/resources"              │
│  → Goal = Unblock dependencies                          │
├─────────────────────────────────────────────────────────┤
│  EXECUTION RISK                                         │
│  "We have the tools"                                    │
│  → Goal = High velocity / Quality experiments           │
├─────────────────────────────────────────────────────────┤
│  STRATEGIC RISK                                         │
│  "We are executing well"                                │
│  → Goal = Verify hypothesis moves the metric            │
└─────────────────────────────────────────────────────────┘

How To Apply

STEP 1: Identify Your Frontier
└── Do we know what moves this metric?
└── Have we proven the levers work?

STEP 2: Match Goal to Frontier
└── Unknown levers → Learning goal
└── Known levers → Execution goal
└── Proven levers → Outcome goal

STEP 3: Don't Overcommit
└── If in Understanding phase, don't promise revenue
└── Promise insights instead

STEP 4: Move Along the Frontier
└── Each quarter, advance your understanding
└── Eventually you earn the right to set outcome goals

Common Mistakes

❌ Setting an outcome goal (Revenue) when in "Understanding Risk" phase

❌ "Throwing spaghetti at the wall" to hit arbitrary targets

❌ Treating all goals as equally achievable

Real-World Example

At Tinder, data showed high spending from a small group. Instead of blindly trying to grow revenue, they set a goal to understand WHY. They found these weren't rich people, but frequent travelers/salespeople. This insight led to "Tinder Platinum."

Source: Ravi Mehta, Former CPO of Tinder, Lenny's Podcast