I used to reduce until the sauce coated a spoon. A chef friend pointed out that leaves no room for the food's own juices on the plate. Now I stop a bit earlier and let it finish with whatever it's served over.
Man, I definitely learned that the hard way (with a few dried-out chicken breasts as my teachers). I used to reduce until the pan was basically glued shut, but now I aim for just thick enough to barely hold together. It really does make everything else on the plate taste better, not just the sauce.