A leading indicator is a metric that predicts future performance by measuring activities that drive results. These are forward-looking metrics like number of leads generated, sales calls booked, proposals sent, content published, or emails sent. Leading indicators tell you whether you’re on track to hit your goals before results show up in lagging indicators like revenue. If your leading indicators are strong, you can confidently expect good results. If they’re weak, you know you need to increase activity now before revenue suffers.
Why Leading Indicators Matter More
Leading indicators are more actionable than lagging indicators because you can influence them directly through your daily activities. You can’t directly control revenue but you can control how many leads you generate, how many calls your team makes, how much content you publish, or how many proposals you send. By managing leading indicators, you’re managing the inputs that create the outputs you want. When leading indicators are trending in the right direction, lagging indicators will follow. When leading indicators drop, you can catch the problem early and fix it before it tanks your results.
Identifying Your Leading Indicators
Your leading indicators are the activities that directly drive your lagging indicators. If revenue is your lagging indicator, your leading indicators might be qualified leads, discovery calls booked, proposals sent, and close rate. For content marketing, leading indicators might be content published, organic traffic, and email subscribers. The key is identifying the 3 to 5 metrics that most reliably predict future success for your specific business model. Once identified, you track these religiously and hold yourself and your team accountable to hitting targets on leading indicators, trusting that lagging indicators will follow.