Five: revenue booked against your target, what you earn per hour of work delivered, how much live opportunity you're carrying, where new clients came from, and how much of your time was yours. The first three are financial. The last two tell you whether the business is worth running.
Track five numbers monthly, and make sure at least two of them are about the work and your time.
Revenue alone reports a third of the picture, so a business can look healthy while two thirds of it decline.
Work out what you earned per hour on your last engagement, including the unbilled hours.
We can't talk about profitability without talking about money, but we can't just talk about money.
Leah Neaderthal, Smart Gets Paid
Three financial numbers are worth tracking: revenue booked against target, effective hourly rate, and live opportunity. Together they tell you where the year is heading, whether the work is priced right, and whether next quarter exists.
| Number | How to get it | What it tells you |
|---|---|---|
| Booked against target | Signed revenue for the year, against the figure you set | Where the year lands, months before invoices say so |
| Effective hourly rate | Engagement fee divided by every hour it took, including unbilled | Whether the price matches the work |
| Live opportunity | Total value of real conversations in motion | Whether the year after this one exists |
Booked is the one to watch rather than invoiced, because an invoice reports a decision made months ago and booked revenue reports the decision being made now.
Effective hourly rate is the number almost nobody calculates and almost everybody should. Divide the fee by every hour that engagement consumed: scoping calls, revisions, the email thread that ran three weeks, the report nobody asked for. Consultants routinely find that the engagement they were proudest of paid worst, and that finding is usually a pricing signal.
Carry about three times your revenue target in live opportunity, measured in money rather than in names. That multiplier exists because most opportunities never sign and because the ones that do arrive on the client's timetable rather than yours.
What makes this a tracking number rather than a one-off calculation:
Counting it straight is the hard part, since a comfortable-looking list is usually padded with opportunities that have been almost-ready for a year. How to work out your own number and what counts as live covers the method, including the perpetual ones that should be moved off the list.
Two non-financial numbers matter: where your clients came from, and how much of your time was yours. Both are easy to capture and both answer questions the revenue line can't.
Write down the origin of every signed client: a referral from a past client, a post someone read for months, a warm outreach email, a podcast episode, a speaking event. Two or three years of that turns into the only honest answer to which activity is worth your time. Without it you'll keep funding whichever channel feels busiest, and busy is not the same as productive.
Count the hours in a month that weren't client work and weren't business development. This is the number that catches the direction everything else hides, because revenue and delivery both look fine right up until there's nothing left over. A year of that trending down is the clearest early signal there is, and what it turns into if nothing changes is worth reading while the trend is still early.
Monthly for all five, quarterly for what they mean. Fifteen minutes a month keeps the numbers real, and any cadence tighter than that produces anxiety rather than information.
Then, once a quarter, ask what the five are saying together. One month is noise, and three months is a direction. The most common quarterly finding is that booked revenue looks fine and live opportunity has been falling for two months, which is the same problem arriving early enough to fix, and why that gap opens months before it hurts explains the delay.
I want to be clear about why the list is five and not fifteen.
Every consultant I know who built a proper dashboard stopped updating it by March. Not because they're disorganized, but because a business this size doesn't generate enough signal to fill a dashboard, and updating something that tells you nothing is a chore with no reward attached. Five numbers you'll look at will do more for you than twenty you won't.
The one I'd fight for is effective hourly rate, because it's the number that changes behavior. A consultant who works out that her favorite client, the interesting one, the one she talks about at dinner, is paying her a third of what her least interesting client pays per hour, makes different decisions the following quarter. Nothing else on the list does that in one sitting.
And I'd hold the line on the two non-financial ones. We can't talk about profitability without talking about money, and we can't only talk about money. A year where revenue rose, the work got less interesting and your evenings disappeared is a year that scored one out of three, and if the only thing you tracked was revenue, you'd file it as a good year. Then wonder, two years later, why you feel the way you do.
A spreadsheet handles all five, and most consultants at this size never need more. Software helps once the number of live conversations passes what you can hold in your head, which is usually somewhere around fifteen. The failure mode worth avoiding is buying a tool to solve a habit problem, because an unmaintained CRM tells you less than a spreadsheet you keep updated.
Comparing your effective rate against your own past is more useful than comparing it against anyone else's, since the right figure depends on your market, your engagement type and the life you're funding. What the number is for is spotting the spread: when your best engagement pays three times what your worst one does per hour, that gap is the finding, whatever the absolute figures are.
Track both once your costs are meaningful, and revenue alone is usually enough for a solo consultant whose main expense is her own time. The moment contractors, tools or travel start adding up, revenue stops describing what you keep. The practical trigger is the first month you can't answer what a given engagement cost you to deliver.
Finding out early is the whole reason to measure, and the alternative is finding out late with fewer options. A falling opportunity total in month two can be worked on. The same fact discovered when the calendar clears is a quiet quarter you're already inside. The discomfort of an honest number is almost always cheaper than the discomfort of the situation it's warning about.