MARKETING TECHNOLOGY
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How do you know your firm is successful? Most of us
answer this question by examining our revenue history. If
the firm did beer last year than the year before (and the
year before that), we project an upward trend into the future
and celebrate. But we don't actually know the trajectory of
next year's growth curve until the numbers are in. That's
the problem when we use lagging indicators to predict the
future.
Lagging indicators are historical signifiers of events
that have already occurred. Our financial reports are full of
lagging indicators, such as revenue received, billing rates,
billable hours, write-offs, realization, overhead costs and
profit margin. These data points give us a sense of where
we've been and how we've done, but they don't necessarily
tell us where we're going. For that, you would need to look at
leading indicators. Leading indicators are predictive signals
that demonstrate trends before they have fully emerged.
If you want a picture of how your revenue will look
next year, try examining:
New Relationships: Are the number leads in your CRM
increasing over time? Keep in mind that according
to CRM experts, up to 30% of your database becomes
defunct each year, either because your contacts move,
change jobs, retire, or pass this mortal coil. So, make
sure that your lead-generation efforts are identifying
more prospects than you are losing through arition.
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by David Ackert of Ackert Inc.
How to Predict Your Future Success
How to Predict Your Future Success
