Drops, Depth, and the Danger of Misreading Numbers

Conceptually, it’s easy to think of a body of water as drops of water.

One drop feels insignificant. Manageable. Almost theoretical. But no one argues with an ocean.

In business, we often treat numbers the same way. As individual drops.

• Revenue.

• Profit.

• EBITDA.

• Data.

• OKRs.

• TAM, SAM, SOM.

• KPIs.

Each metric, on its own, feels contained. A line on a spreadsheet. A slide in a deck. A green or red indicator that tells us whether things are “working.”

But operations does not live in drops.

It lives in accumulation, pressure, and flow.

A single number rarely tells the truth.

A point-in-time snapshot can be deeply misleading.

And a business can look healthy on the surface while slowly eroding underneath.

That erosion is almost always hidden below the waterline.

When the Surface Looks Calm

Earlier in my career, I worked in a market where charge volume was growing steadily. From the outside, the story was clean and comforting. More spend. More usage. A growing business.

But over time, something didn’t sit right.

Despite the growing volume, margins were slowly declining. Not dramatically. Not enough to set off alarms. Just enough to be explained away by noise, timing, or temporary investment.

Simple P&L pulls did not give an answer.

High-level reports showed movement, but not cause.

On the surface, the ocean looked calm.

Going Underwater

So I started from a blank Excel sheet.

No templates. No inherited views. Just raw numbers.

Instead of looking at the market as a whole, I built mini P&Ls for individual spend categories. One by one. Slowly. Methodically.

That’s when the truth appeared.

There was a category where the cost per dollar earned exceeded the dollar itself. By 23 basis points.

The issue was not volume. Volume was doing exactly what it was supposed to do. The issue was structure.

We were offering outsized rewards value on a spend category that carried a lower discount rate. In plain terms, we were giving away too much for transactions that did not generate enough revenue to support it.

None of this was obvious from the surface metrics.

All of it lived beneath the waterline.

I had to put on scuba gear to see it.

Changing the Current

Once the issue was clear, the solution was straightforward, though not always comfortable.

The market reduced the rewards benefit tied to that spend category. The cost was cut roughly in half. What had been a negative 23 basis point drag became a positive 22 basis points.

More importantly, margin erosion stopped.

The business did not need more volume.

It needed better alignment between incentives and economics.

That distinction matters.

The Operator’s Job

This experience reinforced something I have seen over and over again.

Most poor business decisions are not the result of bad intent or lack of intelligence. They come from misread numbers.

Point-in-time views mistaken for trends.

Surface metrics mistaken for depth.

Activity mistaken for health.

Operators have a different responsibility.

Not to worship numbers.

Not to react to every wave.

But to understand the water.

Where is it shallow but wide?

Where is it narrow but deep?

Where is it quietly pulling the foundation away?

Operations is the discipline of knowing whether you are standing in a puddle, a river, or an ocean.

And whether the next step forward is safe.