What Is a Lagging Indicator? | Vantage
Lagging Indicator A lagging indicator is a metric that reflects what has already happened. Revenue, churn rate, customer count, and NPS score are lagging indicators: by the time they change, the underlying causes have already occurred. Lagging indicators are useful for measuring outcomes but not for predicting or preventing them.
Why lagging indicator matters
Lagging indicators are important for measuring business health, but they arrive too late for intervention. If churn increased this quarter, the causes happened last quarter. PMs must pair lagging indicators with leading indicators to have both accountability (did we succeed?) and foresight (will we succeed?).
How it works
Track lagging indicators monthly or quarterly for business health assessment. Use them to evaluate whether product changes achieved their intended outcomes. But do not wait for lagging indicators to take action. Instead, monitor leading indicators daily or weekly and act on early signals.
Common mistakes
Using lagging indicators as the primary input for product decisions
Not pairing lagging indicators with leading indicators
Setting OKRs based solely on lagging indicators (you cannot influence them directly)
Confusing lagging with leading (DAU can be either, depending on context)