In the past I have tended to get enamored with dashboards, graphs, gauges and charts, that quickly provide a visual snapshot or status update.  In business it can be a revenue report, sales figures, or a monthly production log. Dashboards are useful tools, but I’ve learned they have a limited value. Most dashboards and reports measure lagging rather than leading indicators. They measure results. You can’t change them. Lagging indicators measure what has already occurred.

It’s important for a business to know and track this type of information so changes can be considered.  However, I think of greater importance in business and in life, is to track leading indicators – What’s happening now. Measuring sales figures that’s a lagging indicator. However, monitoring and tracking daily sales calls, training and equipping your team, improving product knowledge, gaining a better understanding of your customer’s needs, those are leading indicators.

In economics a leading indicator is a measurable set of data that may help to forecast future economic activity. Leading economic indicators can be used to predict changes in the economy before the economy begins to shift in a particular direction. A lagging indicator is a measurable figure or set of data that changes at some point after an economic or business trend occurs. Lagging indicators confirm trends and changes in trends.

Here’s how I view leading versus lagging indicators in life.  Let’s say you’re working on your wellness goals and want to lose some weight.  You step on the scale and see the number – which you are not happy with, that’s a lagging indicator. The number is what it is. A leading indicator though would be tracking trends, how often are you getting exercise? Are you getting enough sleep? Are you choosing a healthy lifestyle, foods, and eating habits? Are you working too many hours? Taking time to rest? You can’t do anything at the time you step on the scale about the number staring up at you. A scale won’t help you lose weight or get healthy.  But you can control the leading indicators. Implementing new habits and practices, and making needed life adjustments, at some point will have a positive impact on the lagging indicator. The scale will move, and your overall wellbeing will improve.

Here is another example, you want to get out of debt. You look at your credit card bill – the dollar amount of debt you have is a lagging indicator. It simply reveals a history of poor financial and spending habits. Wringing your hands, and saying I need to get out of debt won’t help. The leading indicators and trends you need to monitor are, What’s your attitude towards money? Do you have an unhealthy inward desire for wealth? Are you spending more than you earn? Are you following a budget? Are you stingy rather than generous? Are you cultivating an attitude and life of contentment vs consumerism. By monitoring and controlling the leading indicators, over time the lagging indicator will improve, and you’ll become debt free and even better, you’ll achieve financial freedom and contentment.

What about other indicators in life? Are you tracking and focusing on lagging indicators such as power, prestige, position, possessions, and promotions. Are you more concerned about your retirement account statement, the number of likes and followers you have on social media, instead of focusing on and tracking leading indicators? Leading indicators such as prayer, time in the Word, giving, fellowship and exercising your spiritual gifts. What about your relationship with the Lord? Are you spending quality and quantity time with your spouse, children, grandchildren, building friendships? May I encourage you to focus on leading indicators in the here and now? Living purposefully, investing in the lives of others, making memories, and leaving a godly legacy.

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