Managers often find themselves staring at dashboards full of lagging indicators – revenue, closed deals, win rates – trying to figure out what went wrong last month.
While these numbers are critical for measuring past performance, they offer little insight into the future. They are the scoreboard at the end of the game, not the real-time feedback that helps you win.
Leading indicators, in contrast, act like vital signs for your sales process. When tracked correctly, they reveal not just where you’ve been – but where you’re headed.
Lagging vs. Leading Indicators: Beyond Just Numbers
Lagging indicators are a look in the rearview mirror. They show you the results of your team’s past efforts (e.g., total sales, customer acquisition cost, deal size). While essential for reporting, they are not actionable in the present moment.
Leading indicators, on the other hand, are proactive. They measure the activities and behaviors, such as meetings booked, qualified opportunities, or prospecting touchpoints, that directly influence your lagging indicators. Think of them as the vital signs of your sales process. These are the metrics that, when tracked, tell you if you are on track to hit your goals long before the quarter ends.
Why it matters: Only 24.3% of salespeople exceed their yearly quota, and just 72% of top performers say they always put the buyer first – highlighting how misalignment between activity and outcome limits results.
For example, if your goal is to close $100,000 in new business next quarter (a lagging indicator), your leading indicators might include:
- Number of new meetings booked
- Number of qualified opportunities created.
- Average time spent on proactive prospecting.
- Total calls or emails sent per day.
How to Set Powerful, Measurable KPIs
A great KPI is more than just a metric; it’s a measurable activity that is both within a salesperson’s control and directly linked to a business outcome.
To set powerful KPIs, you must first have a clear, structured sales process. Paul O’Donohue, Founder and CEO of SalesStar, emphasizes this point: “Many CEOs and managers don’t know how effective their sales teams are. There are a lot of cogs and wheels, which makes them complex and quite difficult to understand.”
- Define Your Process: Map out every step of your sales journey, from lead generation to post-sale follow-up. Each stage should have clear, measurable milestones.
- Identify Key Activities: For each stage of your process, identify the key activities that lead to a milestone being achieved. For example, to get a deal to “Discovery,” your team needs to have a certain number of calls, emails, and social touches.
- Link Activities to Goals: Establish a clear connection between your sales activities and your revenue goals. If you know that 10 meetings lead to one closed deal, and your goal is 10 deals, you know your team needs to book 100 meetings.
- Define Your Process: Map out every step of your sales journey, from lead generation to post-sale follow-up. Each stage should have clear, measurable milestones.
This approach transforms abstract goals into concrete, daily actions that your team can focus on.
Using KPIs to Drive Predictable Results
The real value of KPIs isn’t just in tracking them; it’s in using them to coach and manage your team. When you have a clear set of leading indicators, you can:
- Diagnose Problems: If your team is falling short of its revenue goals, you can look at the leading indicators to diagnose the problem. Are they not booking enough meetings? Are too many deals getting stuck in the pipeline? The data tells you where to focus your coaching efforts. As Paul O’Donohue explains: “Fixing one cog in isolation won’t guarantee instant sales success.”
- Coach Proactively: You don’t have to wait until the end of the month to see if you’ll hit your target. You can monitor leading indicators in real-time and provide targeted coaching to keep your team on track.
- Build Accountability: A shared understanding of KPIs creates a culture of accountability. When everyone knows what activities are required to succeed, the focus shifts from results to execution.
Teams using activity KPIs see 19% productivity gains, and sales managers who coach weekly see 35% higher quota attainment.
Mindset: The Invisible KPI
Numbers don’t tell the whole story. A sales mindset built on resilience, positivity, and growth orientation becomes the multiplier that makes KPIs work.
- Sales professionals with a positive mindset outsell peers by 56%, and 70% of buying decisions are influenced by reps’ attitudes.
- Those actively working to overcome limiting beliefs see performance improvements 85% of the time.
- Goal orientation matters: individuals with mastery (vs. performance-focused) orientation consistently outperform peers in sales metrics.
Conclusion
Ultimately, by focusing on leading indicators, you move from managing by outcomes to managing by activities. This not only gives you a clearer picture of your sales engine but also provides the data and insights needed to consistently drive predictable, sustainable growth.
The question isn’t whether your KPIs are telling you a story – it’s whether you’re listening.
By building a system that turns your data into a clear narrative, you empower your team, enable proactive coaching, and ensure your sales success is no longer left to chance.
O’Donohue puts it this way: “I always say those that plan the fight don’t fight the plan. Sales managers need to take a collaborative approach, get their team really clear on the plan, and reverse-engineer the KPIs so it’s clear how they’re going to achieve it.”
Building a system that turns your data into a story is a key outcome of our Strategic Foundation Workshop. Learn how we help leaders define their sales process and set the right KPIs to drive predictable results.
