North Star Metric (NSM) is the most important metric that best represents the value your company provides to your customers. Often times, it is correlated to your other metrics or is built upon several other metrics. We strongly recommend defining your North Star Metric for its ability to focus your team and align efforts towards a growing the value your customers receive from your product.
For example, a SaaS company may decide that “Monthly Active Subscriptions” is a good metric that describes the customer value. The “Active” part is notable since users with subscriptions that do not use the product are not getting value despite paying for the product.
Generally, your team's Objectives should improve the NSM or improve a metric that is directly related to your NSM.