Leading With Leading Measurements

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Leading With Leading Measurements

Written by Jerry

Most leaders of most organizations have a tendency to rely on lagging measurements to determine organizational progress or success (Sales results, EBT, Stock price, etc.). As important as these measurement might be, they are very much like reading Monday's sports page and focusing on the scores from the weekend's games. The problem with focusing on these results is that they are lagging measures and good for reporting the news but not very good for making certain there is good news to report.

Since its introduction in 1992, the Balanced Scorecard has trained many leaders to turn their attention away from lagging measures to focusing on leading measures for all levels of planning and forecasting, beginning with strategic planning right on down to measures for each organization and the workers within them.

Using sales as an example, it is far better to be using leading measurements to set goals for the selling process than just the sales level itself. In an example, early in my sales management career I was fortunate enough to lead a sales team of just 10 people from near last place among 800 Xerox sales teams to the very top in less than a year. I believe that setting goals and tracking the results of the copier selling process steps was instrumental in our success.

I ask each salesperson to commit to a number, any number but 'their number' of the specific process steps:
- Cold calls
- Presentations
- Demonstrations
- Proposals
- Closing calls

Each salesperson committed to more than I thought they could ever do. I was wrong. The organizational culture of that sales team encouraged every salesperson to not only meet their commitments but almost universally exceed them by a wide margin. Each week we would tally up our leading measurement results and the sales results as well (Lagging measure).

At first it was pretty scary. It looked like a bunch of fish flopping on a deck. Not many sales but lots of 'focused activity'. After a month or so we began to see a trickle of orders. In the ensuing months that trickle became a torrent of sales. By the end of the year, the team was so far over plan that it was number one in our branch of 10 teams and number one in the region with over 70 teams and in the month of January of the next year, the team was number one in the country out of 800 teams.

Sales process measures are easy to set, track and report. I realize that in some organizations, setting leading measures will be more challenging. However, the results can be just as good in any organization if the team will just take the time necessary to find the key leading measures and gain the commitment of every team member to his or her part of these leading measures. Every organization can experience their own form of what our sales team experienced during those early years at Xerox.

The point of this story of course is how easy it is to focus on the wrong results. Great organizational leaders build their high performance workplace cultures by focusing on the leading measurements that will lead to great Monday mornings, basking in the glory of the lagging measures due to their organization's focus of the leading measures.

More Information

Great organizational cultures don’t just happen. They are created by leaders who understand the critical elements of high performance organizations. These leaders constantly monitor these critical elements within their organization to ensure that they are steadily applying leadership direction to constantly move their workplace cultures toward their true performance potential by building organizations that consistently:

Produce outstanding bottom-line results
Attract, motivate and retain top talent
Readily adapt to changing conditions

Making Culture Pay

An essential tool in maximizing the potential of your organization, Jerry's book "Making Culture Pay: Solving The Puzzle Of Organizational Effectiveness" will provide you with a new understanding of culture... and reveal a proven process for cultural renewal!