The framework’s core value lies in its explicit escalation criteria. These criteria force organizations to make conscious, documented decisions about threat levels rather than drifting into crisis (or denial) by default. When the checklist is clear, there’s no room for denial.
Yellow to Orange – Core Question: Has the threat demonstrated that it’s real and growing, not just potential?
Escalate when: Competitor achieves meaningful sustained traction (not just launch buzz). Your metrics show measurable impact beyond normal variation. Internal technical assessment confirms the approach has genuine merit. Power users show sustained interest, not just curiosity. The threat demonstrates staying power across weeks, not days.
Do NOT escalate when: Competitor product remains unproven at scale. Your metrics remain within normal variation. The approach has fundamental, recognized limitations. Early buzz is fading rather than building.
Framework Analysis
Orange to Red – Core Question: Could this threat fundamentally change our industry or destroy our business model if we don’t respond with maximum intensity?
Escalate when: Core business model faces direct existential threat. Competitor achieving viral, category-defining growth. Capability gap would take more than six months to close. User behavior is fundamentally shifting, not just experimenting. Internal consensus reaches “this could end us” levels.
The checklists prevent both failure modes. They prevent underreaction by forcing explicit assessment – if Red criteria are met, normal operations stop, period. They prevent overreaction by providing permission to stay at Yellow or Orange when conditions don’t warrant escalation.
Define your escalation criteria before you face a serious threat. Be specific enough that different leaders would reach the same conclusion from the same evidence. What competitor actions trigger monitoring? What metric declines exceed normal variation? What capability gaps exceed six-month closure timelines?
The Deeper Pattern
Explicit criteria remove the burden of judgment from crisis moments. When leaders don’t have to decide “is this bad enough?” in the heat of competitive pressure, they can focus on execution. The decision is already made by the checklist.
Key Takeaway
Explicit escalation checklists – defined before you need them – remove judgment burden from crisis moments. The criteria force conscious decisions rather than drift into denial or panic.
Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
