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by raywu 821 days ago
Can someone explain the leading and lagging indicator in this paragraph?

> OKRs, given they typically focus on change are usually leading indicators focused on shorter time windows and KPIs, which represent the health of what the organisation seeks to sustain, are usually lagging indicators focused on longer timeframes.
2 comments
andreareina 821 days ago
A leading indicator predicts something about the future, e.g. an OKR of cutting spend predicts that you will indeed cut spend. When you set a new OKR it will take a while before it shows results—it leafs ahead of them.

A lagging indicator is the result of something that took place in the past; 99.99% uptime over the last year indicates you probably had some good practices in place (redundancy etc). If those practices were to change, it would take some time for the kpi to actually change—it lags behind.

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bdg 821 days ago
Leading is an imperfect predictor for the change we actually care about. Lagging is a late confirmer.

Hours worked is an imperfect predictor of output in a factory. Widgets delivered is a late confirmer. Leading and lagging indicators for productivity.

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