Q1 Leading Indicators: Know Early If the Plan Is Working | SBI

Short answer: By the time Q1 bookings come in short, it’s too late to save Q1 and hard to save the year. The conditions behind the plan, such as pipeline created, ramp progress, stage conversion and renewal risk, move months before bookings do. Track them monthly from January, set trigger points now for when to act, and the plan becomes something you manage during the year rather than something you check at year end.

The first post in this series, Which Number Is the Real Number?, argued for turning the board’s target into a Conditions Register: every condition the number depends on, with today’s value, the required value and an owner.

That register doesn’t stop being useful when the plan is approved. It becomes the dashboard for the year.

Why are bookings the wrong early signal?

Bookings are a lagging indicator. They tell you what happened to pipeline that was created months earlier. With a 120-day sales cycle, Q1 bookings mostly reflect pipeline from Q3 and Q4 of the prior year. If January pipeline creation is weak, it won’t show up in bookings until Q2 or Q3.

Leading indicators show the problem while there’s still time to act.

Which leading indicators should you track?

Take each condition from the plan and pair it with the earliest signal that it’s on or off track. Using the running example:

SBI’s general guideline for pipeline coverage is 3:1 to 4:1, but the target in this table should come from your own win rate, as explained in Which Number Is the Real Number?.

What are trigger points, and why set them now?

A trigger point is a pre-agreed threshold that forces a decision. For example: if new qualified opportunities fall below 120 in any month, the CMO and CRO meet within a week to decide on corrective action.

Set them now, before the year starts, for two reasons. First, it’s easier to agree on thresholds when nobody is defending a miss. Second, it removes the most common delay in mid-year course correction: debating whether the problem is real.

Every trigger should name three things: the threshold, who meets, and how fast they must decide.

What should happen when a trigger fires?

There are three possible decisions, and the leadership team should be explicit about which one it’s making:

• Adjust the method. The bet is right but the execution isn’t working. Change the approach and keep the target.
• Reallocate. Move budget or people from a bet that’s ahead to one that’s behind.
• Reset. If a condition can’t be met, change the number and tell the board early, with a clear explanation.

The third option is the hardest. It’s also the one that protects credibility most, because a board that hears about a gap in March can act on it. A board that hears about it in October can’t.

How does this change annual planning?

When the Conditions Register becomes the operating dashboard, annual planning stops being a once-a-year event. The fact base for next year builds itself from this year’s monthly reviews. The bets get tested in real time. The next planning cycle starts from evidence instead of memory.

That’s the shift SBI’s planning approach recommends: treating revenue planning as a continuous practice, with the executive team reviewing and adjusting throughout the year rather than starting from scratch each fall.

Where should you start?

Take the conditions from your approved plan. For each one, name the leading indicator, the monthly target and the trigger point. Put the list in front of the leadership team before January 1, and review it at the first monthly business review of the year.

The board gave you a number. This is how you show them, every month, whether you’re going to make it.

For ongoing support through the year, visit the SBI Annual Planning Hub.