We understand the theory of leading indicators, but when we look at our weekly scorecard, most of our metrics still feel like historical autopsies. How do we test a metric to ensure it is truly a predictive, leading indicator rather than a lagging result?

Question

Tyler Smith · Accepted Answer

Most leadership teams confuse lagging results with leading activities. If you are tracking revenue, gross margin, or closed sales on your weekly scorecard, you are looking in the rearview mirror. By the time those numbers turn red, the damage was done weeks or months ago.

To test if a metric is truly a leading indicator, ask this question. Does this number measure an activity that we can directly control today that will guarantee a specific result tomorrow? For example, revenue is lagging. Proposals sent is leading. Signed contracts is lagging. Outbound discovery calls is leading.

Another test is the timeline of correction. If a number goes red on your weekly scorecard, do you still have time to take action and change the outcome before the end of the quarter? If the answer is no, it is a lagging metric.

Your scorecard should be heavily weighted toward activity-based metrics. If your operations seat tracks the number of projects completed on time, that is lagging. Instead, track the percentage of project milestones hit by Thursday of each week. That shift gives you a weekly early warning system. When you focus your scorecard on the activities that drive your business, you can identify, discuss, and solve issues during your Level 10 Meeting before those issues hit your profit and loss statement.