It’s the trip of a lifetime. You’ve pulled together your friends or organized your family. The plan is to take a grand tour out West. You’ve laid it out perfectly. The destinations have been selected, the hotels booked and the local eateries checked out. You’ve cast a vision to all involved about how amazing the trip is going to be. Finally, the day of the big trip arrives. Everyone piles in the car, eager with anticipation, only to sit in slack-jawed amazement to see that you have blacked out the windshield and inform them that you are going to take them to the destination only by looking in the rearview mirror.
Not much of a way to take a trip is it? It’s not much of a way to run a fitness center either. But, far too many executives and directors, maybe including you, are leading their organization with this exact methodology. They take the initiative to make meaningful change at their centers, but because they are failing to measure the results properly, the initiative fizzles and dies. Ever had that happen to you? Let’s take a look at how this happens and how you can turn this trend around to lead with clarity and insight as you drive your team toward reaching your goals.
Inevitable failure by improper measurements
In order to understand the problem let’s take a look at a sample case. Let’s say you’re the Membership Director of a local fitness facility and your branch is struggling to retain its members. You do a lot of research and decide that a better onboarding program is the way to address the problem. So, just as with the trip out West, you gather your team, sell them on the benefits of onboarding, walk through the process of how you are going to do it, and tell them the results you hope to achieve: a 5% increase in overall member retention. Everyone, with great enthusiasm, goes out to enact the program.
Six months after the initiative was begun, you finally feel as though you can get meaningful metrics on its success from a 6-month retention rollover. Much to your dismay, you see that retention has only ticked up .2%. Discouraged, your staff lacks motivation to give the initiative their full effort and it dies a slow, painful death.
The initiative clearly failed. But why did it fail? The fundamental problem of this situation is that you, as the director, can’t answer that question. Was it because your Membership staff weren’t pitching the program well? Was it because members weren’t interested in the program? What if they were only coming to the first meetings with a coach, but not the second, third, or fourth? You have no way of knowing because you were using the wrong metric for measuring for success. Like the nutty driver in the failed trip out West, you weren’t looking out your windshield, but focused solely on your rearview mirror.
Lagging vs. Leading Indicators
The problem is that a 6-month retention rollover, in fact a retention rollover of any length, is what is known as a lagging indicator. A lagging indictor is a way of looking backward and determining the big picture of how you have done. It is an overall measure of past performance.
Lagging indicators are a necessary metric at your facility, they give you the overall picture of how you have done over any given period of time. But, as we’ve seen, they’re like looking out a rear-view mirror and are of very little help when you are trying to lead in bringing about change in your organization.
What you needed to use in this situation was leading indicators. A leading indicator predicts future success. Like looking out of the windshield, it tells you how you are doing in moving toward a goal that lies ahead.
If you’re trying to lose weight, standing on a scale gives you a lagging indicator. The number of pounds you lost (or gained!) tells you how well you have done over the past period of time. Contrast this with the number of calories you are eating and burning each day. These are leading indicators. If at the end of each day, you log the calories you took in versus the calories you burnt off, you will know how you are doing in achieving your goal.
The beauty here is that you get daily feedback on how you are progressing. If you are burning more calories that you are consuming (leading indicator) you know when you stand on the scale (lagging indicator) the results will be positive. And not only that, you will know exactly why they were positive! If you are consuming more calories than you are burning, you will know you are not progressing toward your goal and can make changes (working out more, eating less) on the fly to keep you moving in the right direction.
To look at it one final way, when you’re in school, the number of hours you study each day is a great leading indicator. It will tell you how you are doing, so you can largely predict your grade. The grade is the lagging indicator giving you a big picture view of how you have done.
Measuring for Success
Now let’s put our understanding of leading and lagging indicators back into the example of the Membership Director. Instead of measuring by retention rollover alone (lagging indicator), she should have also developed a number of leading indicators to allow her to track their progress in real time and predict the ultimate success of the program.
In this case, she could have tracked the number (or maybe better yet, the percentage) of new members who register for the onboarding program, the number of those people that show up for their appointment, and the number who graduate the entire program.
The beauty of this is she will now be able to know if the new initiative is going well (lots of members registering, showing up, and graduating) or not and thus will be able to predict whether the retention rate should increase or decrease.
Even more, if there is a problem, she will be able to see exactly where in the process it lies. She can now tell if members are signing up and not completing the program, or if they are simply not signing up at all. This gives her the information she needs to target a solution to specifically address the source of the problem.
If you are trying to lead change at your facility, it is critical that you measure your progress in such a way that it leads to success. You need lagging indicators, they give you a good look at the big picture of your performance in the past. But, you cannot reach your goal by just looking in the rear-view mirror! You have to look ahead by setting up leading indicators that give you real-time insight into how you are doing in progressing toward your objective. This allows you to make adjustments to your plan that are laser-focused on the exact area that is problematic. We will discuss exactly how to do that in our next blog…
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