We have a key leading indicator on our weekly Scorecard that has been red for six weeks, yet our lagging financial goals are completely on track. This discrepancy makes our leadership team question the validity of the Scorecard. How do we address a metric that seems to have no correlation to our actual bottom-line success?

Question

Tyler Smith · Accepted Answer

It is a frustrating scenario when a key leading indicator on your weekly Scorecard is consistently red, yet your lagging financial goals are completely healthy. When this happens, leadership teams usually assume the Scorecard is broken and stop paying attention to the metrics altogether. This is a mistake.

If a red leading indicator is not impacting your bottom line, it means one of three things:

- The target you set for that metric is artificially high and does not reflect actual operational capacity or market demand.
- You are tracking a vanity metric that has no real correlation to your business performance, meaning you have selected the wrong number to track.
- Your business has a delayed lag time that you are ignoring, and the pain of those red numbers will show up in your financials next quarter.

To resolve this, you must IDS® the discrepancy. Review the metric and trace its path to your revenue. If you find that you can consistently hit your sales goals with half the outbound calls you originally thought, adjust the target down to reflect reality. If you find the activity does not actually drive results, delete it from the Scorecard and find a better leading indicator. Your Scorecard must be a living tool that accurately predicts your operational reality, not a wishlist of unrealistic expectations.