Are You Using The Windshield of Your Business?

This is a different ball game compared to the routine review of your profit and loss statement or tracking sales goals. Think of it this way—when you're driving, do you rely on your rearview mirror or your windshield to navigate?

Leading Metrics: The Windshield of Your Business

Leading metrics, my friend, are the windshield of your business. These are the forward-looking indicators that give you a glimpse of the road ahead. They empower you to anticipate and respond proactively, rather than react to what's already happened.

Let me illustrate with a few examples:

  1. Sales Pipeline Velocity: Imagine having real-time visibility into the pace at which potential customers move through your sales pipeline. If you notice a slowdown, you can take action before it impacts your revenue.
  2. Website Traffic Trends: Monitoring your website traffic regularly allows you to spot trends. A sudden drop in visitors might indicate a technical issue, and you can address it promptly.
  3. Customer Satisfaction Scores: Tracking customer satisfaction scores on an ongoing basis helps you identify issues early, so you can make improvements before they affect your reputation.
  4. Inventory Turnover Rate: By keeping an eye on how quickly your inventory is moving, you can adjust your ordering and stocking strategies in real time, avoiding overstock or shortages.
  5. Lead Conversion Rates: Tracking how effectively you're converting leads into customers helps you tweak your sales and marketing strategies promptly.

These leading metrics act as your early warning system, allowing you to make course corrections while you still have time. They're your business's crystal ball, helping you steer toward success.

Lagging Metrics: The Rearview Mirror of Your Business

Now, let's talk about lagging metrics—these are like using your rearview mirror when driving. They tell you about the past. It's a historical snapshot, not necessarily a crystal ball showing the future. Reviewing your Profit and Loss report at the end of a quarter to check if you hit your sales goal doesn't leave you much room to make course corrections.

But don't get me wrong; lagging metrics are crucial too. They offer insights into the results of your past actions.

Here are some examples:

  1. Revenue: Your total revenue for a quarter or a year is a lagging metric. It tells you what's already happened.
  2. Expenses: Similarly, your expenses are lagging metrics, reflecting your past spending.
  3. Net Profit: Your net profit, while essential, is a result of your past financial decisions and actions.
  4. Customer Churn Rate: Knowing how many customers you lost last quarter helps you understand the impact of your service or product quality.
  5. Employee Turnover Rate: Tracking how many employees left last year informs you about your workplace culture and management practices.

Lagging metrics are your historical records. They're essential for evaluating the results of your past strategies and decisions. However, they're not the best indicators to steer your business in real time.

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Inside the course, you will learn:

- How to identify the BIG problems in your business

- How to determine which problem to fix FIRST

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- Agent O's method for gaining buy-in from your team 

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I’m Olivia aka Agent O!

I help your business go from struggling with frequent cash flow crunches to having enough cash in the bank to survive the ups and downs of a typical business.

I found that 1 in 2 businesses fail within the first 5 years NOT because they are “bad at business” but because they do not have a profit strategy in place.

‌I created Agent O’s Clarity to Profit Method to teach small business owners how to finally be and stay profitable.

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