Standard criteria for evaluating a country’s level of development are income per capita or per capita gross domestic product, the level of industrialization, the general standard of living, and the amount of technological infrastructure.

Environmental degradation is a significant externality that the measure of GDP has failed to reflect. GDP also fails to capture the distribution of income across society – something that is becoming more pertinent in today’s world with rising inequality levels in the developed and developing world alike.

There are five leading indicators that are the most useful to follow. They are the yield curve, durable goods orders, the stock market, manufacturing orders, and building permits.

3 Steps to Find Lead Indicators

1. Lead indicators aren’t the same as forecasting or extrapolating.
2. Step 1: Check the research for known explanatory factors.
3. Step 2: Check your business processes for new potential explanatory factors.
4. Step 3: Choose the strongest of your potential lead indicators.
5. DISCUSSION:

Popular leading indicators include:

• The relative strength index (RSI)
• The stochastic oscillator.
• Williams %R.
• On-balance volume (OBV)

Some general examples of lagging indicators include the unemployment rate, corporate profits, and labor cost per unit of output. Interest rates can also be good lagging indicators, since rates change as a reaction to severe movements in the market.

While a lag measure tells you if you’ve achieved the goal, a lead measure tells you if you are likely to achieve the goal. Lag measures track the success of your wildly important goal. Lags are measures you spend time losing sleep over. They are things like revenue, profit, quality, and customer satisfaction.

If a leading indicator informs business leaders of how to produce desired results, a lagging indicator measures current production and performance. While a leading indicator is dynamic but difficult to measure, a lagging indicator is easy to measure but hard to change.

Leading indicators look forwards, through the windshield, at the road ahead. Lagging indicators look backwards, through the rear window, at the road you’ve already travelled. A financial indicator like revenue, for example, is a lagging indicator, in that it tells you about what has already happened.

What are Leading Indicator KPIs? Leading Indicators can help predict what will happen in the future. They let you know if you are on track to achieve the results you want. Leading Indicators are measurable, and you have the ability to influence or move them.

“Safety leading indicators are proactive measures that measure prevention efforts and can be observed and recorded prior to an injury. As opposed, safety lagging indicators are reactive measures that track only negative outcomes, such as an injury, once it has already occurred.”

Health and Safety KPIs are measurable values used by Health and Safety Teams to track and determine their progress on specific business objectives. These KPIs essentially act as a health and safety performance review.

Positive performance indicators (PPIs) measure those actions that provide good occupational health and safety (OHS) outcomes. PPIs are a measurement of the success of good OHS practice. They are a way of measuring the OHS performance in your business.

Five Key Safety Metrics to Improve Performance

1. Incidents. Any seasoned EHS professional knows the importance of tracking your organization’s Total Case Incident Rate (TCIR).
2. Inspections.
3. Observations.
4. Training.
5. Safety Suggestions and Hazards.