Leading and lagging metrics

Leading metrics and lagging metrics: illustrated by diet and exercise as a leading metric with weight loss as the lagging metric

Prints

Lagging metrics are usually the ones we care about most. In business, they're things like revenue, sales, or profit. The trouble is, we can't act always act on those directly. By the time we assess our revenue everything we did to get there has already happened, so if we don't like it, it's too late.

Leading metrics are what we need to focus on to drive the lagging metrics. If we want to lose weight we might be better off focusing on eating less and eating healthier, working out more, and sticking to our workout schedule. To increase our revenue we may want to look at deal size, ease of sign-up, or our referral rate.

Paying attention to and improving the leading metrics gives us leverage over the lagging metrics we may really care about.

Also see: Analytics maturity

Published 12 Dec 2021

A weekly sketch by email

Learn something new in a sketch each Sunday

Sketchplanations in a book! I think you'll love Big Ideas Little Pictures

Prefer to listen?
Try the podcast

Like Sketchplanations?
Support me on Patreon

Keep exploring

The Wheel of Death

The Bullwhip Effect

What is Naismith's Rule for calculating walking time in the mountains example explained with a mountain ridge with hikers and lines for the horizontal distance and time and ascent and time

Naismith's Rule for mountain hiking time

Isometric projection

The XY Problem

Buoyancy

The Wheel of Death is a handy and simple tool to help prioritise issues and where to spend time fixing things. I learned it from the domain of customer service. It's used something like this: Keep track of customer issues that you encounter each week by tagging them. At the end of the week, tally up the responses and produce the Wheel of Death to see the highest volume of questions or issues taking up the team's time. Use the Wheel as part of a conversation about where the company should focus to improve the experience and save time for the team and customers. The proportion of issues is only part of the story, and other factors like how critical the issue is, how much time it takes to resolve it, and how much work it is to make it go away will all be part of the decision. I learned it from working with a talented head of customer experience as we worked on fixing support issues, though don't confine its use to that. I find "the Wheel of Death" a name that sticks with me, but it could also be called the Wheel of Fortune. If you focus on the Wheel for a spell, it's hard for things not to improve. Worth bearing in mind that in its form as a pie chart, you'll need to combine it with volume or time metrics, or it can look like you're not making progress. I revised this sketch slightly from the original…The Wheel of Death is a handy and simple tool to help prioritise issues and where to spend time fixing things. I learned it from the domain of customer service. It's used something like this: Keep track of customer issues that you encounter each week by tagging them. At the end of the week, tally up the responses and produce the Wheel of Death to see the highest volume of questions or issues taking up the team's time. Use the Wheel as part of a conversation about where the company should focus to improve the experience and save time for the team and customers. The proportion of issues is only part of the story, and other factors like how critical the issue is, how much time it takes to resolve it, and how much work it is to make it go away will all be part of the decision. I learned it from working with a talented head of customer experience as we worked on fixing support issues, though don't confine its use to that. I find "the Wheel of Death" a name that sticks with me, but it could also be called the Wheel of Fortune. If you focus on the Wheel for a spell, it's hard for things not to improve. Worth bearing in mind that in its form as a pie chart, you'll need to combine it with volume or time metrics, or it can look like you're not making progress. I revised this sketch slightly from the original

Newer

RRandom

Older