Blog Post # 192 – Lead and Lag

I am no economist.

But I have heard the phrases “lead indicators” and “lag indicators” for many years.

Never really understood them.

Turns out a lead indicator is “a measurable economic factor that changes before the economy starts to follow a particular pattern or trend. “

A lag indicator is “a measurable economic factor that changes only after the economy has begun to follow a particular pattern or trend.”

Seems straightforward enough.

These measurements help forecast future revenue in the business context.

A lag indicator would be how much money your company will generate in a particular month. A lead indicator would be how many appointments with potential new clients you meet with.

If you get sophisticated enough, you could be able to accurately estimate your lag numbers by tracking your lead numbers and seeing the ratio.

What does this have to do with us?

We can apply this concept to our personal lives as well.

Specifically, to exercise and weight loss.

Too often, when it comes to weight, we get caught up in the lag indicator. How much do we weigh?

But in reality, we cannot simply “control our weight.”

Weight is ultimately a lag indicator.

Many lead indicators can be tracked and analyzed to get to our lag indicator – weight.

We can track our calorie consumption.

We can track our exercise.

We can chart these lead indicators.

And it is the lead indicators that we can control.

The things that we have power over.

The beauty of this is that if we take care of our lead indicators – the things that we can control – the lag indicator (our weight) will take care of itself.

Hope this framework helps. It has helped me lately as I have been tracking my lead indicators for a few weeks now.