Lagging Indicators
Lagging indicators are metrics that measure something that already happened. By the time you see a lagging indicator—whether it's revenue in a dashboard, cash in the bank, or a cancellation notice from a churned customer—it's too late to take corrective action. The choices that led to this moment have already been made.
Why do product teams struggle with lagging indicators?
Business outcomes like revenue, profit, market share, and churn are all lagging indicators. Product teams struggle when tasked with these metrics because:
- They're too late to be actionable — You can't course-correct after revenue is already lost or gained
- They're influenced by many factors — Lagging indicators are often affected by things outside the product team's control
- They don't guide daily decisions — Teams need more immediate feedback to know if they're on the right track
How do lagging indicators relate to leading indicators?
The solution is to identify leading indicators—specific customer behaviors that predict lagging business outcomes. For example, engagement is often a leading indicator of retention, which is itself a lagging indicator.
All business is a bet on future human behavior. To impact lagging business indicators, teams must identify whose behavior will change, how, and why that will drive the desired business result. These anticipated behavior changes become the leading indicators that guide discovery work.
Product teams responsible for business outcomes need to do the work to translate a lagging indicator into a leading indicator that is within their span of control.
Learn more:
- Empower Product Teams with Product Outcomes, Not Business Outcomes
- Shifting from Outputs to Outcomes: Why It Matters and How to Get Started
Related terms:
- Leading Indicators
- Business Outcomes
- Product Outcomes
- Outcomes
Last Updated: October 25, 2025