Let’s put modesty aside for two seconds. When it comes to our own business, there’s very little we don’t actually know. Our knowledge of what is necessary to succeed runs deep, we’ve shaped our team so they drive that success, empowering them to do so with market leading technology that’s jam-packed with our customer’s data. Growth and profit are always in our crosshairs and with all our pins neatly aligned a spike in revenue is always a few closed deals away.
We know this because we’re following some pretty solid KPIs. In business, tracking Key Performance Indicators (KPIs) is of vital strategic importance; it’s only through analysis that we can be sure of progress or determine the direction we want our businesses to take. Yes, we know exactly where we’re heading. But, do you know exactly how to get there?
Here’s where knowing your ‘Lagging’ from your ‘Leading’ KPIs makes a huge difference.
Traditional businesses are led by Lagging KPIs – these are the indicators that tell us what has happened, the final output of our efforts. They’re easy to measure but very difficult to directly improve.
On the other hand, many forward-thinking business leaders are directing their teams through Leading KPIs – these indicators are forward facing and give us a true insight into the true health of our business. Rather than tracking final results, they measure the steps necessary to reach our KPIs and so, have the biggest impact on our end results. Contrary to their Lagging counterparts, these are complicated (yet not impossible) to measure.
To really influence the direction of your business, you need to carefully track both. See them as part of an equation where action (leading) equals results (lagging).
2 Unexpected Benefits of ‘Leading’ Indicators
- They’re more immediate than ‘Lagging’ indicators: For example, say your target for the next six months is £100K. By keeping an eye on Leading KPIs such as the growth of your pipeline, you will have a better idea of whether you’re on track to meet your target or not.
- They serve as great coaching prompts: Asking a sales rep to sell more or telling a service agent to service better is like asking a football player to score more. They know that’s the aim of the game but they don’t always get there. Instead, teach them the steps necessary to reach their goal. Leading indicators will allow you to showcase the exact activities necessary to accomplish your Lagging targets.
Driving your Team to Better Results:
Here are 3 things you should be tracking if you’re looking to keep your team in check:
- Leading as well as Lagging KPIs. (see above)
- Time: Track not just the actions behind your outcomes but how often these occur. To work out exactly what sort of timeframe you should be expecting to see, analyse the behaviours of your top reps. What cadence of work do they have? Once you work out what magic number they swear by, promote this level of activity across the rest of your team.
- Negative behaviours: If what you’re looking for is absolute clarity, don’t stop at behaviours leading to positive outcomes. Track the habits that constantly trip up your progress. Only by identifying what’s damaging for our businesses can we protect ourselves from it.
Where Do I Start?
The sheer volume of behaviours, indicators and data can be daunting at best. To put your mind at ease, we have put together a checklist of Leading KPIs you should be tracking to ensure your business is on the right path to closing on a win this quarter.
Download your free checklist now.