The health of the business should always be important to an employee, but it is exponentially more important when you yourself are the business. It is critical for consultants to track metrics that measure the health of their business. In a video at Consulting Success, Michael Zipursky explains four of these metrics.
Zipursky discusses four metrics that compose your client pipeline: leads, conversations, proposals, and wins/losses. Leads, both outbound (reaching out to prospects) and inbound (prospects reaching out to you), are a measure of the health of your marketing. You should record the number of leads you have both for its own sake and also to compare it to the number of conversations you have. If you are not having conversations with prospects, then you are squandering opportunities.
Following up with prospects and having conversations to build relationships is an important step that must not be rushed through. Trying to leap through this step in order to make a proposal can actually sabotage your proposal, because prospects may not feel invested enough in you yet. That being said, your total leads, conversations, and proposals should all be at similar levels if you are guiding prospects properly through the pipeline.
It is still possible regardless that your proposals will “lose,” and if losses are too high versus wins, you can observe the proposals that have failed and look for trends. You can also look for trends in your “wins.” These are all useful data points to observe.
For further tips, you can view the video and an accompanying transcript here: https://www.consultingsuccess.com/important-metrics-to-track-for-a-consulting-business-video