Podcast Episode 53 - The Importance of the Job Scorecard
IN THIS EPISODE:
This week on The Growth Whisperers we discuss the Job Scorecard from Brad Smart at Topgrading - and why it's so important for successful hiring.
Over our many years working with companies we've seen great hires and bad hires. One thing we've noticed is that leaders are often not clear enough upfront about what "great" looks like in a role.
The Job Scorecard determines what success will look like in a role. It's a tool to use during hiring and onboarding AND throughout the entire lifecycle of each person's role.
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EPISODE TRANSCRIPT
Please note that this episode was transcribed using an AI application and may not be 100% grammatically correct – but it will still allow you to scan the episode for key content.
Brad Giles 00:13
Hi there, welcome to the growth whispers where every week we talk about how to build an enduring great business, all the things, you can't just do one little thing, if you want to build an enduring business that lasts decades or generations, there are so many important things that you need to do. And that's what we talk about, right here. This week, every week, I'm joined with my co host, Kevin Lawrence. Kevin, how are you doing today?
Kevin Lawrence 00:41
Doing great, Brad, we've spent a few hours tonight getting ready for this and, and working on some of the things we're working on. So I think I'm doing really good. Looking forward to today's show. It's a topic I'm very, very passionate about, because I seen how it prevents painful, unnecessary mistakes in our businesses. So we will dig into that will tell you more about that in just a few minutes.
Brad Giles 01:06
Oh, yes, we will. And I'm excited to talk about it as well. But as always, we like to start with one phrase or one word, what's your one phrase or word for today?
Kevin Lawrence 01:19
My word is full. You know, it's interesting. I just did we just had our quarterly meeting with our team on Thursday. It was awesome were remote. So you know, we had some, some great plantings on a combination of zoom and mural. And we figured out a lot of awesome stuff, great debates, great decisions, and Janice, our team even set us up with all fun activity, where everyone got sent a little box, they weren't allowed to open. And we had a Easter cookie decorating contest. Now I might have to contest the results because I didn't win. But we did have an impartial judge. My point is we had a lot of fun, it was great. And under that came up with some very, some serious things I need to get done in quarter two of this year, which is you know, April through June. I also want to have some time with my kids and my family and friends at the racetrack. And you and I have some goals too. So I'm feeling like I got a lot of priorities. And I think I might have to and before we started, I was just making a note, I might need to pare back on some of my other goals because it's just you know this that, you know, there's that phrase, you're biting off more than you can chew Yeah, so I'm full because I think I've over committed is what it is. And I need to adjust that right away. So that I can have an awesome quarter both for myself and for my work and life too.
Brad Giles 02:56
Oh, very good. Very good. So for that self, myself something slightly different. It's scoreboard. So yeah, so I was reflecting with the football season has started up here in Australia. And this is not soccer. Despite Yeah, some may think this is Australian rules football. And so that started up again, we're a couple of games in and I was just reflecting Wait a game last week where it ended up being a one point difference. And so let's say it was about 70 or 80 points for the whole match. There was only one point difference. And it was an arm wrestle the whole way through. And what it made me think is the power and the trust of the school board. And how much that influences the emotions of the crowd. People are standing up and yelling and people are completely trusting in the scoreboard. And then if you translate that back into our business, Do people really trust our scoreboard? You know, they've got to trust the scoreboard to be emotional about it. They've got to know that what are the rules of the game that we're playing? And how much do I trust the scoreboard that we watch together? So yeah, that's what's on my mind is the scoreboard and you I know you and I have done a podcast episode about dashboards. And this is kind of on the same thing. But yeah, it was just reflecting just how worked up the crowd get because they trust they know the rules, and they trust the scoreboard.
Kevin Lawrence 04:45
That's interesting, because you often see in companies where people don't trust the data that comes from the finance team or the operations team. And they spend so much time in passionate debates about the numbers being right or not, and they're not Be able to focus on the game metaphorically or what needs to be done in a business because they're disputing the score. And the accuracy of That's awesome. So if we kind of mashed together our words of the day, we're going to have a we're driving for a full scoreboard, and a full scoreboard could be a great thing, because that could be equated to winning. And or it could also be acquainted to building an enduring great company. So today's show with a full scoreboard as we talk about scorecards, which is the theme of today, and so today, we're talking with this wonderful thing, called the job scorecard developed and popularized by Brad smart, the author of top grading, his son Jeff did a book called who, as a almost a mid market version of the book that takes that has a slightly different version of it. But really, it's instead of taking, you know, the generic, typical job description, which is a almost a little, little, little, little, little literary piece, a whole bunch of words to describe, try and describe a human, we do more of a mathematical piece, or an engineering piece, and come up with numbers and facts and data to define the person we're looking for. And you know, I recently done a bunch of work with over the past while with Chris Mar saw the this the president of top grading, he runs the business, on behalf of Brad smart. And we were doing a session for a group and we were for CEOs that we work with. And I was describing a metaphor, I came up with a job scorecard. And I know when Chris and I were chuckling about it afterwards, but it's very simple. It's like, no most job descriptions when we try to defined the spectacular human who is going to create tremendous value on our company. Most of those job descriptions are equivalent to a three year old child's drawing of a bridge. And they can be colorful and interesting. They just don't happen to be that precise in helping us choose who should be a part of the job and not. And, you know, this job scorecard that the smarts have popularized, is closer to an engineer's drawing of that same bridge, and nothing wrong with starting with a child's drawing, right. And that's a typical, we know we need a VP of Finance. And we know that they're gonna have five direct reports and a team of 25 people and blah, blah, blah. So that's kind of like the child's drawing. But then this job scorecard is such an amazing tool, we then send it to the engineering department, and have the engineers do a bunch of testing and mathematics and come back with a very precise drawing that we're going to work from, rather than the crayon sketch. So that's kind of what we're talking about today is, is this amazing tool called job scorecard. So Brad, like to ask you like, Why? I know why I love it so much. But why do you love this thing? so much? Like Why is it such an important thing in your mind?
Brad Giles 08:17
I'm gonna answer that by answering, you know, with politicians, you ask them a question, and they answer the question they really want to be asked. Well, that's an interesting thing. But I'm going to answer a different question in any sense. So worse. So the reason that I love the job scorecard is I go back when I had a business many, many, many years ago, like 20 years ago. And we needed to hire a role. And it was a new role to our organization. And, you know, we had the mindset of let's get it done, right, we've got to get things, it's about the result, it's about the completion, more than it is about what took you to get the completion. So in this context, we did what so many other entrepreneurs do, and we said, Hey, what's the role? What is the title that we need, and then we would go to the job board, so the online job board, we would copy the job advert that we felt was most aligned to what we need word for word, and then we edit it to our language, and then we would post it up and that would be about the amount of preparation that we would do at that point. And it was, it was it got the job done? Because that was our mindset, okay, but it was completely ineffective from that point onward. Okay. So if you say the job to be done was to post an advert, well, what Yeah, we got to post an advert and people applied to that advert, but we missed a crucial step. So the reason that I love it coming back to your question, the reason I really love it. Is that a bit, because it's a planning tool, that is a tool that we can use all the way through all of the steps of engagement from Hello, my name is bred right through to you're fired or you're retired.
Kevin Lawrence 10:20
Yeah. And not only is it something that helps you to define and make sure you actually get the right human in the company. Yeah, it's then a tool to help you to manage that person to greatness, not giving examples, and people say, Oh, we need to hire a salesperson, well, go find a job description online for a salesperson copy that put an ad for a salesperson, hey, we'll get a salesperson. And the truth is, you might hire an excellent salesperson. But you might not realize there's probably 25 to 30 different versions of that salesperson. It's like saying, it's like a hunter saying they want to go get themselves a deer. Well, there's lots of different types of deer. And there's, and if you're not aware, you could get one but it's not the right one. I'll give you an example. So even with salespeople, there's inside salespeople, there's outside salespeople. There's outsize relationship managing salespeople, and there's outside hunting salespeople. And there are different types of we're gonna sample just to build off of that, I remember a key executive that we hired, he was amazing. He was an A player in a different organization. So he came from a big company with that has been around for years that had processes and systems. And it had a sales cycle that was 18 to 24 months. And an average sale that was a few million dollars, after many million dollars after that 18 to 24 month sales cycle. He came from that corporate environment, long sales cycle, big ticket item. And he came into a business that had a two hour sales cycle. And he reported a and a $30,000, average ticket size. And he reported directly to an awesome, but somewhat crazy entrepreneur. So even though this guy had the rate, he was the right type of person. If we had had a scorecard, we would see that, okay, he doesn't match on the type of sales. Now he's type 13 as a sales leader, and we need to type 24 because he doesn't match that he doesn't match on the type of person that he's reporting to you. It says like, there's a whole bunch of things there that he would predictably fail. But if we had done a really thorough scorecard and really thought about the candidate and evaluated him against it, he wouldn't have been hired. Now again, we had the guy ended up getting let go, he was a wonderful man, I love the guy. He just he never could have he, he would never would have succeeded in that role. And it's like, you know, yeah, there's lots of lots of metaphors for it. But it's just it was a mis educated hire. And we didn't do enough of the right work upfront to really spec with an engineering drawing of really, who we needed to be successful.
Brad Giles 13:32
And that's an important point, the, if we go back to the example that I gave, whereby we're just copying someone else's job advert, and that's all the preparation that we're really doing until perhaps the candidate arrives for an interview, you know, what we're doing is reducing the chance of a failure by building a job scorecard, a detailed job scorecard that we're going to talk about a bit further on in this podcast. But isn't that what we want? Like, we want to have a much, much better chance of being able to hire the right person, I but then they also we want a tool all the way through that person's journey that we can use to measure their performance and their activities? And are they going according to what we need from this role? Are they performing?
Kevin Lawrence 14:28
Yeah, because we've really clearly defined the rule. That's the point of it. So let's talk about the first piece, what is it? And then that first phase, it's about, you know, the engineers drawing what you want. The second phase is evaluating people against that. Right? And if you need the person in your basketball team, and you need them to be at least six foot six tall, well, that's an important piece of data. And if someone's only six, one, you know, maybe and I'm not saying you know, we're not going to you discriminate basically in business, but in basketball, you know, if it's whether it's height or an ability to, to do a slam dunk, or whatever the heck it is that they require, the point of it is, is then you can compare them to the engineers drawn. So, so let's go to that first piece. And what is on this scorecard is we set up front, it still does have some words, but it's there more words that define specifics that can be measured, versus feelings and beautiful Pro. Plus, that's a praise, but prose. So, so grunt, let's talk about the different the key different aspects of it.
Brad Giles 15:38
Yeah, so I guess we'll start off by saying, we may have slightly different perspectives on it. And that's okay. But we're probably within the ballpark together on most things. So in my experience, what we've got is, first of all, a set of responsibilities. And so that is, you are responsible for i and b, and c, and then we've got the measures of success are the key performance indicators. And that might be you need to increase the sales budget from 100,000 to 130,000. By October 2021, or whatever that might be some very, very specific measures of success that are set in stone that we know exactly what that is going to be about.
Kevin Lawrence 16:33
And those can be operational metrics or KPIs on an ongoing basis, or they can be targets to achieve within a timeframe, like the first year or something like that, but it's very tangible outcomes that that person will be accountable for.
Brad Giles 16:47
Yeah, and then recruiting points. So that means things that really matter within this role that are intangible in terms of the KPIs, or the or the responsibilities. And then the competencies that this person requires. So competencies, meaning, if they're a salesperson, you know, they've got to have an engaging personality, perhaps they've got to have good listening skills, they've got to have good customer focus, or good,
Kevin Lawrence 17:26
or first or first or first impression. Yeah, or maybe they need intelligence. Or maybe they don't. Yeah, and that's, and that's why those competencies are so important, you're defining on these 50 different factors. You can measure human binders, different set, there's different competency models out there, the one that they have, is excellent, but it's defining how good they need to be or don't need to be at it. And it's picking 10 or 12 of them that are non negotiables. If they don't have them, they can't do the job. And those that competency grid, I tell you, Brad has saved me so much. Yeah, because I know about you, I'm a coach, I believe in people, I love people. But even these 50 competencies are color coded. And color coded. If it's easy to change. It can be changed to some hard work, or if it's very difficult to change. And when I look at the ones that are red, and they call very difficult to change in my mind, now it's not changing unless there's some massive intervention. That's the way I think of it. That's not what they say. And so I think of it, which really means to me, Hey, Kevin, don't be optimistic. If they don't have intelligence, it's not going to change. If they don't have drive, or ambition, it's not going to change. If they're not good with conflict. They'll never be good with conflict. Yeah, and, and it's a way to keep the optimists in the room or from over being there or the pessimists who say it can't change. But yet, if it's a green competency, it's been proven it can so that the competencies are massively valuable mass. And if I if I could only keep one piece of the job scorecard, you know, I would fight for that to be it because it helps our clients so much again, that's the spec. That's the data that helps to create the engineer's drawing the rating on a scale of zero or for one to five on those competencies. Sorry, I got excited with that one, Brian, that that one is a game changer. It was a life changer for me once I saw that, and I could see why I'd been involved in some bad hiring decisions.
Brad Giles 19:51
But it really is and what's important is that before you meet any candidates, you're looking at these fifth competencies and you're saying, Well, if it's a sales person in a sales role, and competency number 50, for example is tenacity. Okay? So if they're not tenacious, like it's very difficult to change, and they need to be good at that they need to be tenacious to succeed as a salesperson in our organization. So your mapping layer before you meet them, maybe, maybe, oh, no, no, that was an example. I'm not saying they must be across all exceptions.
Kevin Lawrence 20:34
But I'm saying in some sales organizations they wouldn't have that's the key. Yeah, if it's a retail sales environment, that that tenacity, you know, if you know, the ratings one to five is three is a average college grad, you know, as a baseline, for example, on SEO things, like you know, intelligence or other things, but no, like a three might be okay. In them. Now, if we're running a timeshare company in Mexico, you know, the tenacious tenacity probably needs to be a five, because that's all hard clothes, high pressure sale. And that's and the key and the fascinating part about this, the key is getting the team that's doing the interviews to agree up front. That is critical, whether the hiring manager HR, and whoever else is involved in this to agree because that they can't agree on this that don't hire don't even promote the role yet. Yeah, because it's ma was if we can agree, the where the bridge is going to cross the river. And, and, and what style of bridge that we want. But don't put it out to bid yet to the contractors, we need to be clear on what we're looking for, before we move on. It's, it helps you a lot down the road. But we will find when we start when people want to hire, and we start asking a bunch of questions. And for example, I was talking to an entrepreneur of the day someone referred to me, and, and we got talking about this, and as I gotta hire a new, you know, a new salesperson. Well, as I'm talking to him, he's talking about, oh, both sides of his mouth. He's talking about hiring a salesperson. And he's talking about hiring a sales manager. I'm like, buddy, you know, I love your ambition. But you need a salesperson and a sales manager. It's like a difference between an elephant and the most like, they're, they're very different animals, and you're not going to get an elephant most right? You're not going to get it, you know, you might have a salesperson that could go to a sales manager. Or you might have a sales manager who's willing to do a little bit of sales as part of their job. But they're very different. It's a very different job. It's a very different jobs, scorecard very different competencies for each of those roles. So you got to be clear, otherwise, you're going to likely get yourself in a lot of trouble.
Brad Giles 23:07
Yeah, But so many people shortchange the sales manager role. That's a different podcast, I'll tell you that I could get in deep into that, because the sales manager is its own thing. But let's come back. Oh, my god, yes, competency assessment is a key part of it. So we've got the responsibilities, we've got the measures of success, we've got the company competency assessment, there are these key parts that make it more than job description, as some people may have used that phrase, the old job description is going to maybe have a couple of KPIs maybe have a fluffy sentence. But it's not a job scorecard. Because this digs in so much deeper, and it gives you so much granularity. Once you've built the job scorecard when you begin to interview, and maybe even when you write the job advert, because you know, this is exactly the type of person that we need. I and B then from within the pool of candidates that we get were able to understand what will an AI player actually look like? Which, yeah, that's our goal and a player?
Kevin Lawrence 24:21
Yep, absolutely. So you know, if one of our points here is is is that you know, why you need one? Well, you need one because you need to be crystal clear about what that role is. And the team involved in the hiring needs to be crystal clear on it for sure. Not everyone's just like what is it's really a detailed, take the job description and make it something that's you know, the finance department and the legal department and be happy with because it's so specific, and not for financial legal reasons, but technical minds would be very, very happy with it. So, you know, in simple How would you just if to boil down? In simple terms, the differences? What would you say, Brad?
Brad Giles 25:07
Which differences
Kevin Lawrence 25:09
between this and a normal job ever doing a normal job description? Oh, yeah. So just to boil it down, we've covered a lot of law, how would you boil it down?
Brad Giles 25:16
Alright, job, just normal job description. Purpose of the role. Number one, who you report to, and what your responsibilities are day to day, maybe some KPIs. That's what I would expect to see in a normal job description. It's fluffy. And it's, not as it's not written in a specific manner. And therefore, it can't be used as a tool along the way, in the way in which we want to use the job scorecard. Okay, so it's a bit fluffier, it can really let many candidates through that won't fulfill the a player obligation.
Kevin Lawrence 26:02
Yeah, and it's closer to that child's drawing versus the mathematical we take, even though some of the content might be the same. If you were just to how would you know beef up that normal job description, is when you would shorten down a lot of the words because they don't help in a lot of cases. But you would add in a level those KPIs are those outcomes, those those those deliverables that first person must have? And then the second thing is you would put in the competency, the competencies and the ratings of those competencies. And those little two major sections that are game changers.
Brad Giles 26:37
Yeah, oh, you wouldn't get the job description and chocolate in the bean and then read top grading and then build the example. Friday, right?
Kevin Lawrence 26:45
The best thing to do? Absolutely, Brad, although, you know, I've seen situations where you can take and pull out of that two page, verbal job description, you can pull, you know, two or three sentences out for the description of the role. And then you can pull out a few things for some key responsibilities. And then the rest, you have to sit down and start debating what is it or what Yeah, what isn't it? It's, it's pretty clear. So as we dug into, you know, and with companies that we work with, you know, and I've shared before, like, I demand that our clients use top grading, and that we use job scorecards, it's not an option. You know, we've got two people on our team who are completely focused on top grading and interviewing. So we jet we are We do lots of training on it. And we generally do the interviews for the top two layers of the organization, direct reports to the CEO, and the ones below that consists and some of the roles we get involved in and help with. Because treatment creating a job scorecards work. And after you've done a few it gets easy or, and even then doing the proper interview the top and we're going to the podcast, we've talked about that top grading interview. It's a serious discipline. And it's worth because all and all the top grading interview is once you get there is you take the engineers drawing of the bridge, and you're just doing an engineering spec on the human that you're interviewing, seeing if they can match the one of the bridge with data and facts and who they are and how they work and where they thrive and where they don't. But it's you know, 1020 times the data you pull out of them. Almost per hour, you have the top grading interview. Yeah. Which is that is that second piece, so let's go to so let's just say we're gonna, we've got a company that we're talking to her and everything. Okay, you guys, Brad and Kevin, you're, you're saying this is the right thing to do? How does somebody get started? Like, when one company approached us and said, okay, we want you to we want to hire you, we want you to help us do all of our job scorecards for our whole company. And, and, and we probably said, No, that's a horrible idea. it's kind of like reading. You know, back in the days when we were in school, Brad, and there used to be these things called encyclopedias. You know, these big collections of books, it would be like reading the entire set of encyclopedias or reading every book in the grade that you're in school, and then reading one exam. You're gonna fail.
Brad Giles 29:34
Yeah, it's way too much.
Kevin Lawrence 29:37
So how do we recommend people get going with doing a proper job scorecard?
Brad Giles 29:46
I'm interested in your advice, but your suggestion, your recommendation, my thought is when you have a vacancy. So as a vacancy comes up bid for a new roll or an existing roll, start the process there. And one thing, one very important thing when hiring, we always recommend hiring in pairs. So you would have one candidate, and you would have two interviewers, and part of the job of the interview is, is to discuss this job scorecard before they do the interview around all of the competencies to be able to go in and agree. Yeah, definitely. likability is hard to change, or easy to change, or whatever, in relation to this role. So having a clear understanding, I have the job scorecard for that individual where I'm going to do that, because that's an urgency in terms of hiring the person, rather than a role where we're not might not be hiring for someone for three years. So just focusing on the most important things, having two people who are running that process and building the job scorecard for that, and then measuring the person, the people who they interview along that journey.
Kevin Lawrence 31:13
Yeah, that's, that's, that's, that's one of things we recommend is start with the active roles. Yeah. And so either it's the next role you're gonna hire or promote, because the same process as wire promote required for promotions, promotions have the same failure rate as external hires, contrary to popular belief, same risk, because, you know, with the internal candidates, we already know, and love them. And we forget that there could be big gaps in their capability at that next level that will cause them to fail. So yes, that's it, that's an excellent place to start. For example, we have another company that's approached us, we did a similar project over the holidays, but another company that's approached us and wants to help with succession of some key leaders and the CEO. And, and so that that's a prime example. So we're going to go in and you know, as long as we end up working together, which likely we will, is when we go in, and we will figure out the scorecard for the CEO, it says a substantial, you know, company, so substantial mid market company. So we will do the scorecard for the CEO, that'll be quite a bit of work to get it and get it right now, thankfully, the CEO is still in the role, and where we did one before where the CEO and sadly had passed away. But bill define the scorecard. And then we can start to evaluate existing candidates for that role against what's required. Now, the good news that CEO is not going anywhere, anytime soon. So we've got time to develop. If they're developable, developable competencies, we've got three, five years to develop the successors to see who can step up and fill those gaps. So it's a it's as much as a development process at this stage, as as it is a decision process. Because we're just going to find, here's the, you know, the engineering spec of the bridge, here's this person, oh, they're missing these components. Let's see if we can build those into that person. What projects can we give them? What training can we do? So in that case, yeah, it's a, it's a, it's a for the the the hot hires that you have a hot topic. So the situations that are live hires, or promotions isn't as is the absolute best place to start from there. Once you start to get it and get a handle of the system, then you'll naturally cascade it somewhere else. But if you do too much too fast, it'll fall on its face. It's
Brad Giles 33:37
It's not gonna work. Last week, we spoke about Joey chestnut, right? The major league eating champion, you cannot, you know, you're not Joey chestnut, you can only eat so much or consume produce so much so fast. Same principle here, like you can only get so much done. So what's an another question that someone might ask us? Or maybe thinking is, well, you know, at the moment, we, we use Myers Briggs, or we use a personality assessment, and that seems to produce good results. Why should I consider changing my job description when this current system seems to work? What might be your answer to that? Well, first
Kevin Lawrence 34:23
thing I would ask is, confirm if they're making hiring decisions only by a psychometric assessment, which would be in some many cases, not legal, and to unintelligent, because that's not enough information on a person. I'm one of the biggest fans of psychometrics and we tend to use disc which is like Myers Briggs, and enneagram and strengths that comes out of Gallup. They're awesome. But all they'll do is if we go into the animal world, say That you're kind of elephant Lake, or your most lake or your lion lake or your giraffe Lake, or your hippopotamus like doesn't mean you're a good one, or a capable one, it just, it kind of categorizes you into some styles, which is helpful. And we know from benchmarking and companies, you know, there's a certain roles where elephant like personalities do well. And these other roles rely in types to well, or drive. So it's, it's directionally helpful. But my gosh, it's sure not enough to make a proper decision. So on hiring someone. And the second thing I want to ask is temp, temp, tell me, I'd love to see your stats, of what percentage of your hires turn out to be a player's after six months? Oh, yeah. Yeah, I and that's probably good that you don't. Now I would encourage that you do. So we can validate. Because if you're getting north, which we aim for North of all of our hires, being what we consider an A player, that's someone who fits the culture very well, and consistently delivers on expectations. If 75% of people that you hire are that after six months, well then stick to what you're doing, because that's what we're trying to get to so. So from my perspective, scorecard sets the framework. And our firm we do we use disc and enneagram, to give us a better understanding of the client. But just because if the say the I'm using animal metaphors, just to simplify it, but let's just say that was an elephant type profile that some of the highest performers have had in that role. And this person has that same type of profile, because you can do profile matching Yes, assessments. Um, but that, but that doesn't mean I mean, you know, that elephant might have mental issues, they might have personal issues, they might have, you know, a whole bunch of other things that that psychometric won't tell you so, but the combination of psychometric to help you understand them better. And then an incredibly thorough top grading interview, gives you a lot of what you need to make the right decision. But hey, if what you're doing is working, and you're happy with it, you know, why would you change?
Brad Giles 37:30
Well, do you know, in the olden days, people used to perform on stage and in the olden days, sometimes some people would take tomatoes to that performance, just in case that performance wasn't that great. So grab your tomatoes, get them at the ready, because what I'm going to say is I psychometric assessment isn't a job scorecard. Okay. It's Gosh, nothing like it. And if it was a spectrum, Now, I'm not saying that it is. But if it was, at one end, you might have a horoscope. And then middle, you might have a psychometric assessment, that's going to give you a bit of a flavor. And then the other end driven by a lot of information and competency measurement and understanding and thinking you've got the job scorecard. So yeah, at one end, you've got the job scorecard and the other you've got the horoscope, because Sure, maybe Scorpios will work better in your sales team. And maybe we can make that correlation. Okay. And I'm being a little bit silly here. So hopefully, you haven't thrown too many tomatoes. But the point is, they should be advisory as psychometric assessment, they shouldn't be the sole decision making Gosh, though,
Kevin Lawrence 38:54
that would be absolutely absurd. And that people and some people, and some people might, but that's, yeah, it just that just tells you personality and communication like with, with it with communication styles. It doesn't tell you anything, or whether how good they are the different things you need people to be good at. And it's and it's fascinating. Now, and then the worst part about interviewing is that, you know, based on research, you know, most people make their decision within about five minutes of where they're going to hire the person or less in many cases. Now, the problem with that you're generally judging the person by one competency in the first five minutes aside from attractiveness, which does have an impact on getting hired. Which is not a competency. But the one competency that you're normally picking up in the first five minutes, maybe to one, it's called first impression. And the second is the one about their verbal communication skills. So you're picking up on those two things, generally within the first five minutes, and you're making a decision now, if they're gonna be a greeter at Walmart, and welcoming people to come into the store, hey, first impressions super important, right? Or it may be if it's the host or hostess in a restaurant, you know, first impression and verbal skills are insanely important. But what percentage of the jobs out there? Do you think that first impression is all that matters? Not many.
Brad Giles 40:35
Yeah, I'd say 15 or 20% anymore. DAX?
Kevin Lawrence 40:39
Yeah. Where I'm saying, where's the only thing that matters? Oh, it will be less than 1%?
Brad Giles 40:44
Yeah, very good. Yeah.
Kevin Lawrence 40:45
Because it's like, you got to back it up with something. So that's a problem that most of our hiring decisions it's based on first impression and verbal communication skills and attractiveness. Well, in most jobs, that's, that's less than 1% of the actual job. But it's a huge port portion of what's causing us to make our decisions. If we're truly making those decisions in five minutes, which months, and that's what most people do.
Brad Giles 41:10
Yeah, so the job isn't to be an interviewee. Right? So I'm not trying to win a job to be an interviewee and we should exactly,
Brad Giles 41:19
we should have the tool which is the job scorecard to be able to deliver on that. So quick question, who builds the job scorecard? I think we've kind of touched on that. But to be specific.
Kevin Lawrence 41:32
When you get the person in the horoscope department who really likes psychometrics and is a fan of elephants. That's where you get to do the the the job scorecard you get those. And they sit there and they cross their knees and they go Yeah, that's, that's, that's, that's how you do it?
Brad Giles 41:50
Or, if that didn't work, after you tried it a few times who might be the second best person?
Kevin Lawrence 41:57
Generally, it should be the hiring manager with the support of HR. Yeah, yeah. So who's the hiring manager? Yeah, yep. And HR should be a part of it. Because they're the HR is meant to master the processes and hold us to the standards and be masters of these tools. And the best HR people are, an HR can't do it, because they know the job well enough. The HR manager knows the job, but doesn't know the process normally. And then it should be reviewed by the managers manager. Right. Right. This does a double check in the process. I just don't that's my approach right now. You know, and in some cases, then after that, if you're if it's a real serious role, if they work, you know, as part of a, you know, a cross functional teams of pieces like that, you might get someone from those other cross functions to take a look at it as well. You know, this is the critical again, the engineering of the bridge before you build it is darn important. Yeah, so getting that right is super important. I will tell you, we debate them. No, we'll get the people that the manager and HR to draft it, the other their managers look at it. And then you know, in some somewhere that we will debate them, especially for the senior rules. I'm always, always normally part of that. And we debate the heck out of those.
Brad Giles 43:20
Yeah, it's, it's so important to not have a piece of paperwork, but to have a tool that you can use all along the way. And if you say, okay, we're three weeks, or three months or three years into this role, we can look at this and go Yes, I'm confident if the person is aligning with the needs that we've got that will be successful in the role so fundamentally important. Yes,
Kevin Lawrence 43:52
yes. So why don't we talk about let's just say, Okay, you've got it, you've got a credit, great job, great job scorecard, using the templates that the people that top grading, and you know, in the book talking, or who they've got some great examples and resources they've done, they've done an awesome, awesome job, make sure that they are getting the credit for this right, we use it, they developed it, and continue to develop it. So you've got this great job scorecard, all the key people agree, let's just say that you've then learned how to do a proper top grading interview excavating boatloads of data. And then at the end, you would now go back with data and decide how well the person fits? Do they meet those key things that they need to have? Does our environment match the environments that they have thrived in? And if we go and rate the candidate on those competencies, where are their scores perfectly in line, and where are the gaps things that can be closed are the gaps things that we can live with and whenever When you get someone who's so passionate about accounting, Oh, we got to hire them. I love them. I love them. I love them. Okay, let's take a look at the competencies and look at the facts. You can reground that person, or if you've got someone that hates them, well, where in the competencies were they out? Where don't they match? And it goes from a feeling to a fax conversation. So let's just say we've got that. Yeah. And, and, and we, and we hired the right candidate. Now, that's easier said than done. That's work. But let's say we got that. Then there's, you know, getting them on boarded, and then managing performance. So you know, and I know, this is a passion of yours, Brad. So what now that we've got the right, clarity and role and the right person, how does this tool set us up to win going forward?
Brad Giles 45:45
Yeah. Currently, I'm writing a book about onboarding. I've done a research project with 1100, CEOs and hiring managers around the world. So yeah, pretty passionate about it, do for at least at some point, hopefully, in the next year, or 18 months, it's coming along. Well. So to your question, how, what does success look like from the managers perspective, that's really a central part, which is why the job scorecard is so pivotal between the hiring process and the onboarding process. This is the vehicle that carries us through so there isn't a supplemental component to this, which is the onboarding plan. But that feeds straight off the job scorecard. Okay, so the job scorecard shouldn't tell us should give us a direction or a compass on within 90 days, this person will have this level of clarity and just like you're building a job scorecard to for the role that will help us to understand the hiring process. And forward, the onboarding plan is very much about the first 90 days, because we want to have confidence to fire the person. Okay, we won't have confidence to fire that person, in 90 days time, legally, because the research that I've done almost all let's say most countries around the world have legislation, which says that you can fire a person, if they're the wrong person, within 90 days. Now, of course, check with your local employment law expert, okay. But that's why this 90 day period is so crucial, because we want to have confidence to exit the person if they're not right, or to even extend that probation period. And so, the job scorecard, it tells us what the person will do, and then the onboarding plan will tell us how good it how the person what the person must achieve within 90 days.
Kevin Lawrence 48:06
So basically, you take that job scorecard and you build the onboarding plan based on that correct of how you're going to get them up to speed. And you know, what's interesting, Brad, and I'm excited to see when your book comes out, because, man, do I see the onboarding get messed up a lot? A lot. Yeah, the best, the best, the best companies I've seen do it, they have a very, very defined process for that three-month period, with regular check ins, scheduled pieces, and putting the person in the right psychological state to win. And you know, I have a chat with every new executive that comes into the companies I work with that I get the chance to, and say, Hey, in the first three months, listen, learn, we already know you're awesome. Don't go and try and prove yourself. Because if you try and prove yourself, you do way too much, way too fast and generally make a mess. The Smart still super experienced people already know that. But a lot of people are so passionate and excited and want to show their value. And, and they just they make enemies and they and they make they create problems in the system very, very early on. And then again, it's that's one tiny piece of a proper onboarding. Tiny, tiny piece that can make or break especially an executive role
Brad Giles 49:25
to pick up on your first point there. The really interesting data from the research that I've done. 86% of companies have a 14 day or less onboarding process, okay, 14 days or less. But the real magic happens, the real change in impact happens after 30 days. Okay, so that 30 6090 days the companies had that had those level of onboarding processes. That's where you really start to see that company. We're saying, this is where the real impact happens. So it's, that's why I love onboarding. Because it's like this, this great opportunity that no one that 86% of people don't really know or pay respect to. And that's where the real massive gains ahead, looking forward. But maybe onboarding is for another podcast, like a nice, thank
Kevin Lawrence 50:24
you. It's my Brad, the key, the key point of this of everything that we're talking about here is, is that you have this amazing engineering drawing the scorecard of a role, then you can use that to define onboarding and how we're going to get them to move ahead. All right, last piece you want to mention, and we'll wrap up here, Brad, is that it's also helpful in performance management. So when someone isn't doing well, in their role, you can go back to the scorecard, which of the competencies, are they not thriving? Are they having a problem with? Where is it they're failing versus Oh, I don't like them over this, you can go back to the competencies or the core values, and then help pinpoint the issue. And that might help you because just being able to break a person down into 50 different pieces essentially, helps you to point pinpoint what might help them to grow.
Brad Giles 51:17
So to give us a practical answer, to give a practical example of that, one of the competencies is organization. Okay, yep. And so it may be with that within the job scorecard, one of the competencies, so it may be an absolute requirement, like a five, to do this role, you need to have a five out of five on organization. So then you're going back in a performance management review a year into the future, and you're saying, I can see why this person is failing, because they really only a two, maybe a three out of five on organization, that that's the issue here. So that's how you can use the job scorecard competency assessment, during performance appraisals in the future. It just came interesting idea.
Kevin Lawrence 52:07
I'm working with my daughter on her business bribe, and she's having a hard time keeping up with some things. And I just thinking she needs herself to get a bit more organized. Right. And that's something you can learn. But she hasn't learned it yet. And I got an idea that I might need to share with her. That's perfect. Okay, so let's go back to the beginning, really, we're talking about in today's show what this thing called a job scorecard developed by Brad smart, the author of top grading, it's an amazing tool and resource that we are both massive fans on it's a game changer. And even when I did the book, scaling up and interviewed 50 CEOs around the world, eight of them cited top grading as being a game changer for their business. That's how I got trained on it. And that's how I became so passionate about it just because it's evidence data, it makes a difference. So within that there's this thing called the job scorecard where you do an engineer's drawing of what the job is and what great looks like versus a you know, a kid's crayon drawing, but most job descriptions unfortunately result in that's the root of it. We've talked about why it's powerful, how it can help you how to use it, the idea that the team that's hiring needs to be aligned around it. After they meet candidates instead of an emotional discussion. You go back and evaluate on it. And it's just a very, very potent and powerful tool that helps you to get better people on your team and avoid the pain for yourself and candidates and putting the wrong people in a spot where they're going to fail.
Brad Giles 53:38
Awesome. Absolutely fantastic tool before you hire anyone. Make sure before you even decide make sure that you build a job scorecard. Alright, so if you need more information on job scorecards, you can visit one of our websites. Geez, that's the closest thing that we've ever come to an advert but
Kevin Lawrence 53:58
that's that is wow.
Brad Giles 54:01
Alright, so you can find Kevin at Lawrence and co.com You can find myself at evolution partners.com dot a year. Thank you for listening as always The growth Whisperer is Kevin and Brad, we look forward to having a chat to you every week about building enduring great companies. do enjoy your week. We look forward to seeing you next week. Take care Have a good one.
Podcast Episode 52 - Build Your Business Like You're Never Going to Sell It
IN THIS EPISODE:
This week on The Growth Whispers we challenge the conventional wisdom about building your business to sell it. When you’re starting your business some people say you need to know your exit strategy and be planning to sell your business.
But there’s another view: when you start your business, you should expect to run it for 50 years, or 100 years, or generations. That’s the alternative we want you to consider, and building your business so you keep enjoying it for many years into the future.
SUBSCRIBE TO THE GROWTH WHISPERERS:
EPISODE TRANSCRIPT
Please note that this episode was transcribed using an AI application and may not be 100% grammatically correct – but it will still allow you to scan the episode for key content.
Kevin Lawrence 00:13
Welcome to the growth whispers podcast where everything we talk about is building enduring great companies. Those are companies that people build and continue to build for decades and decades and decades and resources to help them and their teams to do this thing. enduring great companies. That's what we're about. And I'm here today with my co host, Brad Giles, as I am every week and Brad, welcome to the show today. Today is a very special day like really special day. Do you want to tell us about that, Brad?
Brad Giles 00:46
Well, today's episode 52, it is our one year anniversary with so happy to have made it to one year it's great one year of talking about building enduring great businesses. Every week, for one year, we've been doing this and we started in the heat of the pandemic. This was Yeah, really a tough time and now we're enduring.
Kevin Lawrence 01:18
Yes, we are. And you know, like a lot of things that started out as an experiment. Hey, let's try this and give it a shot. We've been enjoying it. bringing our brains together, you know, It'll come together in a book and lots of other great things. So yeah, it's our 52nd episode. Made it to a year persistence pays. And yeah, so what? So today, before we get into our topics today, Brad, what's your word? Or your phrase of the day where you're at today?
Brad Giles 01:47
Yeah. Joey chestnut, obviously, so you're not Joey chestnut To be more specific. So according to major league eating the World Federation on eating the world champion, the undisputed world champion is Joey chestnut, at World at eating records. So Joey's eaten 75 hotdogs in 10 minutes. And if you do, then, and they have that competition on Coney Island in New York, and I think he's also eaten 32 Big Macs is the other world record that he holds, right. But when Joey hit 75 hot dogs in 10 minutes, okay, to give you an idea of just how much how far ahead he is. The number two person is almost flaking out at about 45. Okay, so Joey is by far and away the world leader in consuming hotdogs within 10 minutes. But my point is that you're not jelly chestnut, we talk about all of these things. We talk about purpose, execution data, we talk about great leadership team and hiring the right players. And so you are not Joey chestnut, right, you can't consume at a rate, the average person cannot even consume at a rate of the people who are losing, let alone Joey chestnut. So you've got to be realistic in the manner in which you will consume in which you will introduce these concepts into your business and execute them and get them to stick. So you're not Joey chestnut, there is only one Joey chestnut, who can eat 75 hotdogs in 10 minutes.
Kevin Lawrence 04:00
What you're saying is you have to pace yourself when you're implementing things in your business. Yes, because most people can't consume that much whether it's information or changes or other things that quickly.
Brad Giles 04:14
Yeah. And you know what people say? Like, I want to get all of this stuff in right away. It's cool. It's also awesome. Yeah, but you can't wait until
Kevin Lawrence 04:24
later we just not right. And if we try to consume stuff like Joey chestnut, only half of its gonna get down and then it's all going to come out and there will be no net in the system. Well, that will Yeah, quickly, the system will eject it very quickly.
Brad Giles 04:39
It just won't work. Yeah. It's not only about doing it, but it's just accepting, like we can only consume this content. We can only implement this content so quick and you may feel that that's, you know, You're not happy with that, because you want to get it all done. But it just doesn't work that way
Kevin Lawrence 05:05
it is and I was talking with another entrepreneur last weekend talking about this about phasing things in slowly in their business. So they get solid and become excellent. Versus layering in a bunch of stuff that turns to garbage real fast. That is awesome. So Joey chestnut, well, that kind of leads to my word of the day, which is masters. Interestingly, and I'm just reflecting on the past week on some amazing people in my world that are absolute masters. And I was thinking about the guy that I trade around on a few cars, a couple cars. And this guy makes it so easy. He just he makes it incredibly easy. His name's Cor. He's so easy to deal with. He makes Yeah, he makes he's fair. And he just makes it like frictionless to make the changes that you want to make. And another contractor that I'm working with on a project and again, just making it so easy absolute Master, most these guys have done it probably hundreds of times. And just how would you work with Masters in many in I think all around my life, I'm surrounded by masters on many different things. So So yeah, dealing with Masters, people that are excellent. It's easy, it makes just makes things really easy, which I'm sure we'll come into our theme for today. So and by the way, those masters in my in your oxygen mask first we call them 14x advisors, people who have been there and done that 14 times before IE they know these things like the back of their hand, they're not making it up, and they're not on the bottom of their learning curve. So today, speaking of Joey chestnut, hot dog eating champion and masters who make things easy and even look easy, like Joey chestnut would also do, what is what are we talking about today?
Brad Giles 07:06
Yeah, well, because it's Episode 52. We're talking about why would you want to build an enduring great company? Why? There are lots of people out there, who think that the only option that you can have is build a company and then sell it. And then we're kind of just saying, there's another alternative, there's an option out there that you may not have considered, which is building a company for the purpose of the long term, building a company and thinking about it over a longer period of time, which, you know, it may seem quite strange to some people. So today being our one year anniversary, we're going to flesh that out. And yeah, see where it takes us.
Kevin Lawrence 08:06
Yeah, and there's so much thinking of there, this kind of get rich quick and build it and sell it, it's the common narrative out there in the business world, and we just want to share it, we have a very different view, under circumstances where someone selling their business could make sense, but we're obsessed with and we work mostly with people who want to keep building their businesses for decades or generations. That's and that's what this podcast is all about. We have some others that don't. But the core of our, our passion, especially in this show is about that. So the title is, you know, why should you should build your business, like you're never going to sell it, right. And even if you sell it, building it, like you never got what are going to sell it also gives you an advantage. And in one of these, we were talking, I was preparing for the show, like Brad and I were having some pretty passionate debates about this, because it really makes us mad, it makes us frustrated when we see people sell their business that we think don't need to and we'll get into some of the details. And, and, you know, when there's the intent is just to open up people's view of what's possible, versus that common narrative of you should build it and sell it. And, and no, and especially, you know, as we get into this piece around, you know, if your business is really connected to a purpose, it's like, Can you really even sell that business, but what we'll get into that today. Anything you want to add in there, Brad, before we get into our points,
Brad Giles 09:30
well, just that you don't need to sell. I saw a comment online, I would say within the last few weeks and this person, let's say a thought leader for one of a better term. They said the reason you know a business, the reason that you have a business is to sell it. And I don't think that's necessarily true. I I think that for some people, that's our view, it's a view. Yeah. So people have
Kevin Lawrence 10:04
it's not a foundational truth of the universe life gravity, which it's an opinion, it's a view, it's an option. But there's other perspectives.
Brad Giles 10:16
And that's the point. When that is the only reason that everyone thinks that a business exists. It doesn't is not representative of all of the views. And we've got to think that some people want to build and some people want to keep and some people want to sell. But yeah, there is a case to be made for the other side. So let's dig into that today. So that really flows into the first, the first, I guess, definition normally will sort of say, Well, what are we talking about here, there's a commonly held belief that people are in business to make money and build a business, to sell it and make a pot of money. Again, that works for some people. There's an industry around that, and it works very well. And what we're saying is, if you take a long term mindset, you may think differently, if it's your understanding your belief that, you know, I enjoy the business, I enjoy what I'm doing on a day to day, and this is the difference that I'm making in the world, it can really make a big difference to you. Mostly. Yeah. Anything to add to that?
Kevin Lawrence 11:39
Yeah, no, it says we kind of started with isn't there's this belief that you build it to sell it. And then a lot of the companies that we work with, won't sell, I've got no company in the Middle East, there were three years, India and all around the world companies like they are selling assistant, even on their radar, right, like, and in some cases, they may have some other shareholders in the business or partners or other things, but they just want to keep on going. They keep on building but they all have one thing in common is that there is a purpose beyond profit in the business for all of them. And it's not just about the money, although they generate great money. Normally, they generate great profits. But there's a love and a passion and a connection they have to this thing that they've built and continue to build. And commonly what you see for people, I see a lot of people that contact me that kind of out of frustration that want to sell, because they're kind of at the end of the rope, like yeah, this ain't fun. And we'll get into some of that other stuff later on. But it's, it's because they're there, they, it's causing them more pain than it is giving them you know, joy, right? It's and there's a frustration and a bunch of other stuff that we'll get into it. So that kind of takes us into our second point. The first point is, you see the other alternative, outside the narrative of you know, when you start a business, you got to know your exit, when you started a business, you got to know your exit point and how much you want to get for it, that's a view. Or when you start a business, your alternative is, you know, you got to know your purpose and the difference you want to make and rally people around that.
Brad Giles 13:15
And, what return you want to make. So rather this. So rather than saying only your purpose, or rather than saying how much you're going to sell for. So I want to make a million dollars a year or whatever number that might be that that meets your requirements or $10 million, whatever. The point is that just knowing that there is an alternative is the first step. This is not the only option that's available. Yep.
Kevin Lawrence 13:45
So the second we want to talk about is what is your motivation for selling if you're thinking about it? And again, maybe it is the right, right is the right decision for you. We're just having you see the non traditional perspective I'm not selling so you know, are often when we talk to you is it you know, they for whatever reason, they don't like their business anymore. Like there's some it's not joy when they're going to work and work on their business. Sometimes it's the team, sometimes the only the competitive environments gotten real rough. Sometimes they've gone through a real rough patch financially, and you'll have problems with their banks or other things. Maybe they just burnt out. And maybe they're just cooked. 1And sometimes because of what's going on, they can't see how they're gonna win in the future and they lose faith. And there's all kinds of reasons and you know, you dig into them, and they're all common, like, you know, leading a business isn't the easiest thing in the world, right you can get a job working for your local government, it'd be a heck of a lot easier. But this is meant to be a big challenge and ideally a very rewarding challenge both for your spirit and financially as well. So, so the main thing is no matter what you're motivated, really understand why is it I'm wanting to sell, like, what is the generally pain point that's making me want to sell? Then consider alternatives, like consider other things that could help that. So for example, no one person I know that's gonna sell their business, they're just sick of the pressure. They're just sick of the pressure that lands on their shoulders. Well, if you have too much pressure on your shoulders, that means that there's not enough pressure on your team's shoulders and or you don't have a strong enough team. That means you're probably still in the chapter in my book, your oxygen mask first called make yourself useless. Well, unfortunately, you're probably still too useful. And if you're too useful, that gets tiring, you need to have the team members who are in the useful position, and you were in the strategic role, and becoming more useless.
Brad Giles 15:53
And an interesting question around that subject is, well, what if you weren't allowed to sell? What if there was some government mandate that said, You must own this business? And you were forced? You weren't able? What would you do different? Definitely fire Rob, just as that'd be the first thing. But then do it get Tina and that and that and you know, that customer ABC Corp? Or definitely get rid of them? If I was forced to own this business? Well, then why don't you do it. So understanding that the constraint of freedom is not really perhaps your best friend. And if you could introduce the idea of a different constraint, if I was forced to own this business, how would I run it differently? Can actually get you to illuminate the path of what you really want to do?
Kevin Lawrence 16:48
And our point seven tonight takes that into account of how do you make this thing amazing? Again, if it's not, maybe it's not me? And maybe you want to sell it because you got something else you want to do with the money maybe you want to go and do a charitable foundation and channel the energies there. You know, there's lots of reasons but the point is truly understand it. And if it's a point of pain, is there a different approach that you could take there is almost always there is no, and even if it's, you know, if you're mentally cooked, which burnout we deal with a lot, he might you might need a break, you might need a sabbatical.
Brad Giles 17:27
wait maybe debt levels too high? Well, then you need to work down the debt or refinance it, but the point is, understand what is the motivation for you wanting to sell? That's right. That's beyond the cash.
Kevin Lawrence 17:44
Right? Exactly. Cool. So then, then the next thing, and this is the one that really gets us because we have a lot of faith in people's abilities. And we've seen how people can take businesses and scale it and improve it, because we do it every day, we've been doing it for a long time. It's very simple to us. And I know, he said, they say hard to do sometimes. But you really got to see how that lump of cash, you're going to get whether it's three, or five, or seven, or 14 times your profit or your eba, whatever it is, you got to see how that can actually be an a steal of a deal you're given to someone. Because over the next decade, you could easily have all that cash, go into your personal bank account the same way if you sold it, and you still own the asset. And it's probably worth 2, 3 or 4 times as much if you keep building it. So it's basically normally you're selling it at a massive discount of the future value of your business. If you believe in the future value of the business, and often you might not. But what's possible, it's whatever you sell it for is crumbs, compared to what it could be worth if you continue to scale it and improve it and grow it over the next decade or two.
Brad Giles 19:05
And so I part of the concept here could be short term gain I selling today could equal long term pain, or equally an opposite, short term pain could equal long term gain. That's simple. That simple phrase can apply. So often what we say is, if you were to go through the pain of actually not selling, could you actually get a bigger gain in the long term, or how long would it take you to realize that now in some cases, someone's going to come in with such a large check that it makes your eyes water just to see it right and, you know, the human ness of that situation. You know, we would probably potentially say Yeah, you've got to go for that, that that opportunity is never coming out. again and that may be an absolutely legitimate path if someone comes to you with let's say crazy money but you but what are you going to do what are you going to do
Kevin Lawrence 20:14
because you're selling if you're really deeply passionate what you're selling your soul like you're it's like you're selling off a piece of what you're doing and then you got to go find another place to express your soul and your purpose in life which could be awesome well that's that's which may or may not
Brad Giles 20:35
which could be an example
Kevin Lawrence 20:37
one of my one of my clients that i worked with starting actually i just did an interview on his podcast last week actually name his name is nigel bennett he has a company called aquaguard and probably close to 17 or 18 years ago we started together anyways he didn't like his business at all turns out he had a partnership problem and he talked about this in my book but he put his hand on the doorknob and you feel like he was getting electrocuted every time he went into his own damn office hated it wanted to let tried to sell it anyways long story short 18 years later that thing is an excellent business he's got his third person he tried his president turned out which is a long term guy that grew up in the business who became an excellent president awesome company he's still connected to his purpose around protecting water you know he's involved in helping it plus he's got freedom to do other things and he's living a spectacular life spectacular so but in the end you know he's you choose to keep keep it and let it build and it's given a great opportunity to as president cameron who's doing a great job and and it's turned out like it couldn't have turned out better for him and this kind of ties us back in to our next point point four is ideally your business is a platform for your purpose like the difference you want to make if it's just a platform for profit we understand why you probably want to sell it because you probably don't like it that much but if you find a platform for your purpose something you deeply care about and you feel that intrinsic reward that you get connected to through your business and you can bring it to life through your business and whatever it happens to be there's no feeling like that and that's why i know some of these people can't sell these things because they truly enjoy it so it's a ideally it's a platform for your purpose and if it's not you might consider looking this direction
Brad Giles 22:36
and that's why we talk about building enduring great businesses because in an enduring great business you can fully self actualize your purpose you can fully build what you want to do you can really follow your passion and create the vehicle for you to live out what you really want to do the difference that you really want to make in the world and yes the profit is incredibly important having said that it's also important to self actualize you know that's maslow's hierarchy brian at the top
Kevin Lawrence 23:17
so profits important but at a certain point it's not enough right but when your profit and purpose man that leads you to a great experience and obviously helping to build a great company and now you were talking about tony shea upfront from zappos brad you're sharing that example of how he sold to amazon and maybe you continue with that story that you're sharing and how that that that that ties into this
Brad Giles 23:41
so tony hided coming to work as your your friend with the water company did he was at a business where you know i might disrespect the story but i'll do it with a smile on my face he didn't like coming to work and didn't love the team didn't love the product and really just every monday was like oh god i gotta go back to that work again so he ended up he sold that for north of $200 million i think he sold it to microsoft his first business and then reset and then thought i'm going to do it again but i'm going to build the business that i love to work in the one that's going to make the kind of difference and it was around happiness that's his thing that's his theme right zappos obviously being the company spent a few years building that and then actually i think he sold that for over a billion dollars to amazon but part of that deal the only way that he would do that deal was that he got to continue to run it with full autonomy in exactly the way that he wanted to now terribly unfortunately tony recently passed away Last year. But in terms of what we're talking about here, building an enduring, great company, what's important is that the sale still happened, the first sale happens so that he could build his second business. And then he transacted on the second business, but still continued to build an enduring great company and Zappos. And that was him, fulfilling, you know, his purpose. And so, it's important to consider that the transactions can still apply in some circumstances. But what we're saying is the purpose, your purpose, the purpose is so important and not regretting that as you age.
Kevin Lawrence 25:47
So so so Tony basically got, it was very smart and got himself the double dip, he got the cash benefit, and whoever else had stock options, gods, you got the cash. So we got that you got the cash. And he got the purpose piece, because he was he set himself up with the autonomy to continue to run based on purpose. And it was a, it was a very smart deal that he did there, from both perspectives, purpose and profit. So So the whole idea is, is that you know, the best businesses do feed your soul in some way. And it helps to manage some of the pain that you have, as you're building, it's not always easy. And look at your business, how is it feeding your soul? And you know, what could make it better? How do you bring that purpose back to life or make it more powerful, or to your own benefit, and to the people around? And so so the next point number five is is is like it's kind of inspired by Tony and maybe it's, you know, 4.4 and a half. But look at where your personal return comes from your intrinsic reward your satisfaction in the business beyond money. And sometimes it gets lost. Like sometimes we get so caught up in it, that it's just, you know, you forget what really makes a chicken referencing my stuff. I know you've done stuff on this as well. But there's, there's a piece in, in your oxygen mask First we have you identify your sweet spot. That's where you do your best work that energizes you and you love doing it. Yeah, the combinations. And a lot of times, talk to senior leaders and CEOs. They're not doing their sweet spot, they're actually hating their damn job ever mind the business, they actually what they're doing, they are getting personally drained by what they do not personally energized and they often got to reconfigure it. And you got to restructure. So I've got another CEO, the one from seven direct reports to three, game changer, absolute game changer, another CEO that had the responsibility for legal still in their hand. They outsourced it, all of a sudden, they love their business, probably 20% more because they, they felt they had to deal with the legal issues and they hated it, they actually made them worse. But that's a whole other story. But it's really dialing it in so that you can get a great intrinsic reward not necessarily just connected from what the purpose is, but from your daily work. And what makes you feel good at the end of the day.
Brad Giles 28:14
I do a similar exercise and it's energy up energy down. So what drains your energy as a leader, as a CEO, and what gives you energy? It's a pretty simple kind of a thing. But okay, why can't we get you to offload the things that drain your energy and get more of the things that give you energy?
Kevin Lawrence 28:36
You know, actually, it's we have to not why can't you like we have to, otherwise you're gonna bonk is a leader and you need to be able to be inspired and doing your best and, and have permission to build the team around you the way you want so that you can enjoy the game. So it's like if you were playing, you know, soccer we would call it or you know, or footy or football as you guys would call it. You know the little round ball you chase around the field. If you like to be a forward but your goal a goalkeeper, that's not going to be fun. And if you're a goalkeeper, or vice versa, like you got to play the position you want and play the sport you want because maybe you want to play badminton or croquet or you want to surf. So yeah, so in our roles, we often get lost and we personally don't get
Brad Giles 29:24
to feel good about our work. We'd call it soccer. But Clayton Christiansen said that in an organization, people look to the corner office to the CEOs role, and they think the great intrinsic value comes from having the power from being able to make the decisions from having the big salary. But then, once you get there, after a while you recognize that the great reward isn't the power or isn't the decisions. It's growing the people around you. It's having a team and getting The team to become better versions of themselves. That's the great, intrinsic, personal return on investment that you get.
Kevin Lawrence 30:08
Yes. So point five is making sure that the job that you're doing is the job you want to do, how do you tweak your role to really work for you point six is about investing yourself and learning. You know, a lot of the leaders that continue to enjoy and thrive in their roles continue to learn and learn a lot of stuff, and it helps them to one navigate and make better decisions, and to grow themselves. And I eat the perspective we just shared Brad about, about almost basically becoming the coach versus the best player. Right, that's, that's a shift that a lot of leaders need to make. But you need to learn about that and study and read about other great leaders that did it and how they did it, and what helped them to do it. But it's, it's, you know, a lot of leaders again, that want to sell that when that especially when they're they balk, and they're tired, or they lose faith, they often haven't spent enough time learning, and they need to open up the horizon and see more and talk to them. And sometimes, you know, they need a coach, they need some new mentors, they need to go take a three day executive education program with a bunch of other entrepreneurs are doing you know, lots of different things and do one of those columns sessions that we do when there's not COVID. But you know, it's whether it's additional help, or a guide, or to build their belief or their inspiration, or the strategic thinking or to see new doors they didn't even know existed, sometimes you're really got to really sharpen your own saw and make yourself you know, sharper and more capable.
Brad Giles 31:40
And so if you're going to build an enduring, great business, rather than Sell a Business, you're going to have to invest in yourself, you're going to have to continually stay ahead of the growth curve, you're going to have to be in front of it. And as advisors, as advisors, and coaches, you and I and Kevin, we need to stay ahead of the CEO.
Kevin Lawrence 32:07
Yeah, 100%. And, and, and that's when we have to spend so much time learning and growing ourselves. And we encourage the best part is, you know, we just had a call last week with all our CEOs, or invite them all, and people are all sharing their best learnings and best resources in the past year. Now, the great thing is, when you work with a bunch of amazing people, they have as many good suggestions as we do, and the tribe or the community support each other. It's just awesome. We got some awesome ideas that came out of that last session. And, and but we need to do that regularly, not only for energy and sharpness, but to help with our own growth.
Brad Giles 32:41
So let's move on to number seven. So why should you build an enduring, great company? Rather than maybe sell? Well? Why do you want to sell? Maybe you're just burnt out? Maybe you've just had enough? Maybe you think anything is better than this? And so perhaps you just need a reset? Perhaps you need to start with the blank page. And I spoke about this earlier. What if you were forced to keep your business? By legislation by the government? Or someone else said, No, you absolutely must hate this business. You are not allowed to sell it, then how would you run it differently? You know, there was a famous actor, comedian director called Mel Brooks. And in one of Mel Brooks, movies, he had this famous line where he said it's good to be king. Because the king gets to do whatever he wants. And there was Yes, lots of food and ladies around him at that time in the traditional Mel Brooks humor style. But it's good to be king in the context of your own business, because you can actually start with a blank slide. In preparation for our chat today. We were saying one of the reasons that you would sell is because you want to clean out the garbage. Well, why can't you clean out the garbage? Well, you still own it. So you don't like this software, you don't like this team, you don't like that person you don't like your debt?
Kevin Lawrence 34:16
Well, why can't you don't like your location, you don't like your business model, you don't like a lot of stuff and you know that that clean slate blank page exercise is very freeing and powerful. It's just hard for some people, one they don't make the time to they might not be comfortable doing it. So even if you go look at this, a lot of times when we get lost down a path, sometimes you just need to start way over there. So another CEO we work with his business model is getting commoditized and commoditized and commoditized. And he's been going through some strategic exercises to help them think different perspectives, longer term, big picture, and he's gonna take a little slice of the business and go and build it into potential. what would overtake the existing business kind of exam i've got a few others that have done that but sometimes you need to do it without constraints and give yourself permission and then go make those changes and it's almost like if you if you've got a a beautiful old classic car and then you keep repairing it and repairing it and repairing it now you don't need to throw it in the garbage but you might send it back to the factory or you might like some of the high end brands lijke Ferrari you can send a car back to them and they'll restore it or you might send it to a restoration shop and go and spend an amount of money that might not make sense but they will make everything brand new again it's still that original heritage it's still got the the soul and everything of that original you know 1960s whatever it happens to be car but then they rebuild it brand new fresh so everything is brand new and fresh and revitalized and they might even do something to even they could take it back to its root or modernize it there's a thing and in hot rods in the us called resto mod where they restore a car and highly modify it and modernize it at the same time so it looks with all the heritage and everything but underneath it's like a brand new car
Brad Giles 36:16
one of my sorry one of my favorite companies that do that as a company out of los angeles i think called singa yes beautifully me they made yeah re imagineering i think they call it yeah and they take a porsche 911 from like 1988 to 1996.
Kevin Lawrence 36:42
and 1990 to 1994 it's called a porsche 964 that they use as their base
Brad Giles 36:48
yes and it's everything is modern it's the classic look but it just they are just absolutely beautiful so the metaphor the analogy here is well can you do that to your business can if you become sick and tired of the business what can you do that to your business over a three to five year period
Kevin Lawrence 37:18
one of the teams yeah one of the teams i work with you know they said okay great let's just walk out the door and let's walk in as the new buyers of this business and what will we do to it yeah right fresh because a lot of times we're caught up in old legacy stuff and we don't want to deal with it but we need to and normally the exercise we go is let's go three to five years in the future what does winning look like and then come back and with no emotional attachment to anything what would the decisions we'd make be we make those decisions then you go and look at how do you do it in a respectful way because it involves people but and in many ways you become you think like your own turnaround expert for your own company and sometimes they need it and sometimes it's so refreshing like a snake shedding its skin just so refreshing and it allows you to grow again
Brad Giles 38:10
but it comes back to your core purpose it comes back to you know what do you want your legacy to be what is the difference that you want to make in the world and you know when you retired or as you when you were aged how would you look back and think you know i'm so proud of the difference that I made with the people i helped with the business that we built together yeah would i reset would cleaning out the garbage would that help me to achieve that
Kevin Lawrence 38:46
yeah and if we kind of you know review this and sum this up look if you love your business if it's if it's a platform for your purpose and it should be beyond profit profit screen default and making money is awesome it's a platform for your purpose now there's lots of things that you need to do sometimes to make it work adjusting your role adjusting the business model rebuilding things you should at least be able to have that passion and tension to keep building it like you're never going to sell it and that you're going to keep it for decades or generations and if you did that may be a separate choice but thinking about building something spectacular for the long term will get you to make different decisions sometimes than if you're just going to flip it over in a couple of years right because you're building foundations for greatness for the long term so let's go back and review brad so the main point we're making today is you want people to be aware of this different view where you could build it and never sell it build it and keep it forever because i think it's a travesty some people sell they don't need to and there's the emotional thing where they sell it get a lump of money and then they're bored they want to go back and do it again some might be relieved and then there's the well then then they still need a platform for the purpose so they have to do something else to be useful and feel fulfilled in this world. So number one, you know, when we'll take turns on his brow keeps, you know, seeing this enduring alternative, which we're putting on the map, there is an enduring alternative, build it, to keep building it for the long term like many of our clients do.
Brad Giles 40:15
And then number two, of course, is understand your motivation beyond the cash as to why you are enamored with selling, why you think I would like to sell? What is that? Because, yes, the cash is one thing, what are the other reasons? And then, can you look beyond those reasons? Can you say, Well, I don't like the team or I, I can't see a way that we can win in this business in the future? If that's the case, then you know, maybe you should consider getting some help coach and advisor, to help to rectify those things, because the cash is good. But there is also a case to be made for building an enduring great business.
Kevin Lawrence 41:00
Yeah, and you can fix anything. Secondly is see how whatever cash you're going to get, whether it's three or 10, times your earnings, how if you, if you continue to run it for a year, you're going to get all of that and more and that can all go into your pocket if you do things right. And, or ensure charities pocket, whatever you want. And you still own the asset, which is probably worth at least twice as much, by that minimum, if you do it right. And seeing how that it's just, it's financially, it can look like a lot of cash, but it's nothing compared to if you keep building this business and making it better and better.
Brad Giles 41:32
And then number four is your business is a platform for your purpose, right? When you are leading a purpose motivated or a purpose driven business, it's, it's probably or more often than not the thing that you're deeply passionate about. So if the, if the appeal of selling around profit is, is the main motivation, perhaps your business isn't connected to your own purpose. Mm hmm.
Kevin Lawrence 42:05
For five, look at where your personal return comes from, where's the intrinsic satisfaction you're getting from your work? You know, are you in your sweet spot? Are you actually doing work that you love, and you get to spend your day, doing the things you love and make you feel great and create value or need to find a way to restructure your own role, or maybe the role of your teams, so your team members, so you can delegate stuff that you don't love doing and spend more time being inspired in your job.
Brad Giles 42:33
Number six, invest in yourself, and you, maybe you've slipped behind the growth of the business, maybe it hasn't become as much fun. Maybe you don't have any advisors or mentors or education. And so perhaps you could learn and learn and learn that will help you to keep the business and evolve to build the business that you do love.
Kevin Lawrence 43:07
And then finally, sometimes you just got to do a clean slate, you got to get a blank page, and you got to rebuild this whole thing. And sometimes you can renovate and improve and fix. And sometimes you just got to take the whole thing and start from zero like sending a classic car to get restored, or completely cleaning the house and gutting the whole house and starting fresh or knock the damn thing down and rebuild a bigger, better version of it on that amazing foundation that you have. So at the root of it, I hope you get from today's as many alternatives than building your business to sell it. And there's a lot of people which will interview in the future. So a lot of people who have built businesses for decades and generations and they would never consider selling it. Because they're getting something different from their businesses that those that sell might not be getting. And again, it's not right or wrong. But we want you to see this view we have of what's possible because there's so much noise about selling what you build. And I think you miss out on lots of things if you build something great, and then give it to someone else to continue growing. So that's been the show for today, Brad. Thanks for listening. This has been the growth whispers podcast. I'm Kevin Lawrence here with my co host, Brad Giles, for Brad go to evolution partners.com.au. And for Kevin, go to Lawrence and co.com or go to YouTube if you just want to watch the podcast. hope you have an awesome week. And continue to think about how do you build your company so that you keep on building it, getting lots of intrinsic rewards. cash rewards as well are wonderful so that you can continue to grow and do lots of awesome things for other people in the world.
Podcast Episode 51 - How to Prevent Mondayitis
IN THIS EPISODE:
This week on the The Growth Whispers Kevin and Brad are discussing "Mondayitis" and how it prevents people from building great enduring companies.
The most challenging part is sometimes it affects us as the senior leaders in a company because we just get sick and tired of things within the business and unfortunately, we tolerate them for so long they become normal.
Kevin and Brad share the 7 different causes of Mondayitis and what you can do to prevent or eliminate it.
SUBSCRIBE TO THE GROWTH WHISPERERS:
EPISODE TRANSCRIPT
Please note that this episode was transcribed using an AI application and may not be 100% grammatically correct – but it will still allow you to scan the episode for key content.
Brad Giles 00:13
Welcome to the growth whispers where everything we talk about is building enduring great companies everything that you need to do everything that you need to think about to build an enduring great company. I'm Brad Giles, and as always joined today by my co host, Kevin Lawrence, how are you doing today?
Kevin Lawrence 00:32
I'm doing great, Brad. Except for the fact that it's the end of the day in as dark you know, as the Yeah, I know it's daytime there but I'm actually doing really well just had that a spring break with my kids are actually in the middle of it, but had some time off with my kids last week, which was fun. And looking forward to the show today as always.
Brad Giles 00:52
Yes, I mentioned to you just before we've we're at the end of our summer so and spent some time at the beach, which has been great. Went to a football match yesterday with 38,000 people at our stadium here in Perth, a large football stadium and yeah, it was great to be back in a large crowd, you know, in an exciting match. Really good. One word open up. Yeah, one word open out or one phrase. So what's mine for today?
Kevin Lawrence 01:31
I was thinking about it. my word today is persistence. And I'm going to read you something in a minute, which is my favorite quote on persistence. But I'll give you the context first, so on. Late last week, my son Brayden, and I were up doing one of the activities we like to do called snow biking, which is a motorcycle with a snowmobile track on the front and a ski. Those are just a track on the back and ski on the front, and you go in the mountains, and you can kind of go anywhere you want. And it's a lot of fun. So it took my son for the first time. He had tried one before but just riding it around, not like we're doing so took him for the first time. We went on had a heck of a great day. It was awesome. He did great. My buddy was there with his son who also did well on his snowmobile, a traditional snow machine. And we had a great day, and you know, had the hot tub after had dinner hung out and it was all real good. And then the next day my son was sore, like sore like, his butt was sore because the seat keeps hitting your butt when you go over bumps. Uh-huh. And he didn't want to go. He was just too tired to go in. And basically he couldn't sit on the seat. So what he ended up doing is he mustered it up and he went and did it. And he actually had to ride sidesaddle meaning he couldn't have his butt on the seat at have like his side on the seat is hurt too much. But so he's riding this way, and then he's riding this way. Anyway, so it's persistence. And you know what I know one of the one of my greatest strengths as a human is persistence. It served me well. And sometimes I think I have more persistence than I do intelligence, although persisting has made me smarter because I've learned so much so I'll share a quote. This was in my friend, a good friend of mine. I grew up with Steve Dale-Johnson. His father Rod, had this hanging up in his office. And this is from Calvin Coolidge. Those of you watching the video I've got it on screen. And Calvin Coolidge the quote is nothing in the world can take the place of persistence. Talent will not. Nothing is more common than unsuccessful men or women with talent. Genius will not unrewarded genius is almost a proverb. Education will not, the world is full of educated derelicts. persistence and determination alone are omnipotent. The slogan press on has solved and always will solve the problems of the human race.
Kevin Lawrence 04:11
that's my word today, persistence, because it's almost a mantra in my life. And last thing just on that, I watched the I rewatch the movie recently of Catch me if you can. And, you know, there's a quote in there where the con man, it's his father who kind of teaches them. And he tells a story about two frogs in a bucket of milk. And, you know, one frog drowns. And then the bucket of cream, sorry, and then the other frog kicks and kicks and kicks so much that he turns the cream into butter, and then hops out, which is again another story about persistence. So that's a long word. long winded one word but persistence is the theme of the day in the week. How about you, Brad?
Brad Giles 04:59
Nothing, at all that is as compelling as that. Yeah. Last week, my word was spiral. Okay. And that was we are spiraling up every time we work with a leadership team, okay? A month, a quarter a year goes around, we want to be at a higher level as we spiral upwards. And then this week, as I've reflected, it's really about confidence. And that's the confidence that we get when we work with people in the long term. And it's, you know, I just, I just really despise words like growth hacking, or phrases like growth hacking, because there's, there's something to be said for it being enduring. And the way to build that is focus on a long term things focus over a long term on the long term things. So yeah, my word is confidence.
Kevin Lawrence 05:59
Confidence. Yes. Love it. You know, Brad, what you were just saying, there's something really interesting in that we're in a world of quick fixes, take a pill for anything, take a shortcut hack this hack that. I mean, it's great to learn those things. But enduring success is from layering in layers of discipline, and learning and progress. And, you know, and persistence and building confidence, and competence. But yeah, there's so many people get caught up in it, you know, growth hacking sometimes reminds me of the get rich quick schemes, you know, those pyramid schemes that come along or anything else, and you know, and you
Brad Giles 06:38
know, who's, you know, who the person who is, you know, who the person that gets rich? In a get rich, quick scheme. It's the person that sold you the scheme. Exactly.
Kevin Lawrence 06:50
I know. It's awesome. Anyway, so let's get into our show today. So we're talking about persistence and confidence. Interestingly, those things go very well together. Brad, you got an idea? I can see it on your face. Please. Tell me this is going to be awesome. Hold on, ladies and gentlemen, He is so excited about what he's about to tell us. It's gonna be awesome.
Brad Giles 07:12
Yeah, so persistence and confidence. Great way to start. But one other point, as we begin is that it's now a year since the pandemic began. Yeah, so it was a year ago, pretty much today or this week, when all of the major things like countries closing their borders. Everyone was absolutely in panic mode, trying to figure out what is going to happen. The cases were escalating, there wasn't a new normal. So yeah, the pandemic, it's an interesting subject that we've got today, because the pandemic a year ago was kicking off. And as we were talking about this subject, which you know, is Monday is Mondayitis is actually a pandemic in itself, if you let it run free, if you don't use the appropriate quarantine mechanisms, if you don't use the appropriate safety mechanisms in your organization. Monday, itis can become a real real problem.
Kevin Lawrence 08:21
Yeah, and it creeps up on you. And that's the challenge with it is that it starts to weigh you down, kind of like a cloud hanging over your head, and then the hang head of your team. And then your whole division, sometimes the whole company, it kind of creeps up on you. So yeah, that's what we're talking about today. Mondayitis and we're not talking about, you know, the Monday is that our good friends that might have a problem with alcohol or some other substance have, or it tends to be Sunday night, they hit it too hard and don't make it to work on Monday. Although it is a similar thing when there's some sort of psychological tension or distress that makes you not want to come to the office. So we Brad did some very important research. We went on to the internet and we looked at this thing called the urban dictionary. It's a very it's um yes, it's kind of like the Harvard of urban dictionaries. I'm sure it's a very credible source. I should probably yes, but this is people's opinions on it's it's not a word. It's
Brad Giles 09:21
just there's a lot of very funny definitions on there. There is Yeah,
Kevin Lawrence 09:27
yeah, we picked one suitor for us. I really wish someone had written here is Mondayitis from you know from urban dictionary. It's a feeling of weariness, sadness, apathy, and general distress that many individuals feel when starting the Monday morning workweek. This feeling is usually enhanced after a large weekend Now, also to hold true to our friends in the Middle East and other places that run a different calendar. In a place where you work Sunday to Friday, it would be Sunday itis right? Not Monday. I For people that work on a different calendar than we do in the West, but the point of it is it's just it's basically dreading going to work for whatever reason, and people either showing up unenthusiastic, like not happy to be there, not fully energized, ready to go and hit it first thing in the morning, or actually calling in sick, which we call it in the West. And what do you call this, calling in sick over in your part of the strange world there
Brad Giles 10:26
we would call if, if you're due to come to work if it's an assigned workday, and you decide not to because you don't probably have the motivation. Let's say if you're really sick, then you're sick, right. But we'll call it throwing a sickie.
Kevin Lawrence 10:44
Throwing a sickie, I like it. So no matter what, and look, and here's the thing, we want to say, you know, Brad and I are both big proponents of mental health and taking care of yourself. Sometimes you need to, sometimes you need what we call it, we call a mental health day, or just taking it sometimes you just need an extra day off for yourself to recoup, or to deal with some personal affairs 100%. okay to do that. We're not saying not, we're saying when it's a chronic problem, where people either don't come to work or don't want to come to work, which is the bigger thing, it's they're actively showing up, but they're disengaged. That's what we're talking about today. And as we're saying, it can be, you know, pandemic like that it can spread throughout the company, and have almost a malaise and lack of enthusiasm, or, or lack of desire for many people.
Brad Giles 11:34
Well, what we're really interested in is when the Mondayitis occurs, because of the company. So yes, out, we should alcohol or party too much, or you need a mental health day. That's not because of the company. But what about when people don't want to come to work because of the company because of things that are happening, that's what's really interesting. And that's what can become a real problem, certainly, in terms of attracting and retaining a players.
Kevin Lawrence 12:08
Because it's a symptom, that you're you've got things happening in your company that are unhealthy, or not consistent with it being a place where people really want to show up, and they're excited to get to work and do their best work, ie the intrinsic reward is outweighed by the pain and punishment they get from being there. So it's a symptom. So yes, people have their own personal reasons. But we're trying to get to the fundamental business reasons. So a couple things here, as we kind of dig into this is that this does tend to impact some people more than others. And what we know is, you know, people that are a players generally, are more likely to push through challenging situations that actually clean them up. So what we've seen a players are less likely to suffer from this, although there's a certain point where a players will be less tolerant and move on, ie, if the company isn't going to become a great company to work with. They actually may choose to work somewhere else. Yeah. And that's at a certain point, they've had enough. I'm out.
Brad Giles 13:18
Yeah. And we obviously don't want to get there. And that's one of the reason that we're talking about it today. How can you identify is Monday is a problem with in your organization? And what can you do about it? You know, there's a saying that A players won't work for B players. And the B employees C players, okay. So it's a slippery slope, that suddenly you think things are going well. And then a year or two later, you're going down the track, and you think things have changed so much around here. And all you got to do is take your eye off the ball of trying to attract and retain the top 10% of people in your industry trying to get the best people, suddenly you've got a handful of bees. And suddenly those people if they're hiring or hiring sees, and then you're like, this is a completely different company. And then people start saying things like, gee, I can't wait till the weekend. That's going to be really good at the weekend.
Kevin Lawrence 14:21
And that's a really big problem when you're the CEO and owner of the damn company.
Brad Giles 14:26
Yeah.
Kevin Lawrence 14:27
was recently having a conversation with a CEO who has Mondayitis is Tuesdayitis, Wednesdayitis, Thursdayitis, and Fridayitis is he hates his freaking company. And we start digging into it. And I was talking with him about this as we're going through it. It's like he's got a whole bunch of the wrong people. He doesn't like most of the people that work for him. That's a problem. He actually put somebody else in charge of a lot of it. And this person I, I'm suspecting was not on culture probably doesn't even care about culture and based on the people decisions. So yeah, it's almost like the new CEO hired a bunch of people. And, and most of them are mediocre, but a bunch of them are mediocre. But, you know, the CEO is talking is I don't like these people. I don't like what it's like, in my company. I don't these are not people I've had to spend time with. That's I explained to him, Hey, by the way, that's not how it's supposed to be. No, you're actually supposed to like the people you work with and want to work with them and believe in them and feel energized from the work you do. So yeah, this guy doesn't just have Mondayitis, this he's got like everydayitis. He's the owner of the company. And you will make the change he will. But it's sort of goes both ways. It can be from the owner to their team or a leader to their team, or a team to their leader, it can go either way. But the most important thing about this is it's damn contagious, like this new variant of this, you know, bubonic plague that we're dealing with our world right now called COVID. And, yes, thank you for the technical term. Yes. You know, but and truly, it's like, for example, this CEO, I'm sure he's not having the greatest influence on his team. He's not showing up with a lot of love and joy and engagement, it's going to spread through the whole company, the company probably would get dirty. There's a saying that, you know, the CEO, sneezes, and the whole company gets a cold.
Brad Giles 16:47
Yeah, right.
Kevin Lawrence 16:48
So that's good to see. But, but the thing I really want to say is, also, on the weekend, I was talking to another entrepreneur, Everywhere I go, I know, I'm always talking to different entrepreneurs, and not in the weekend. Last week, I was talking to this entrepreneur, in between our fun times. And, you know, we got the chat going about labor unions, and I don't know what it's like in every part of the world. But, you know, labor unions were started, you know, probably 100 years ago, when people died at work regularly, because things were not safe. And people were not treated well or taken care of. Yeah. And today, most companies are quite good. But it's almost like that this Monday, itis that can spread like crazy between people can almost, you know, is a reason why I guess in some parts of the world where labor unions are there, because when workplaces become toxic, people don't feel respected, or valued, or whatever it happens to be, it creates this, people start getting frustrated. And if nothing changes, they look for an external source, maybe to drive some change, ie a labor unit. We had one company that we worked with that and most entrepreneurial people don't want labor unions, like most, you know, four don't want unions in their businesses, because it's, it's, it adds additional cost from an ownership perspective. And, and I there's sure there's
Brad Giles 18:12
but it adds an adversarial partner.
Kevin Lawrence 18:15
Exactly. And that takes a lot of energy to manage well, and is not always for the benefit of the people or the company. So anyway, you know, and we're not even here to say whether, you know, some people believe in I'm like, the best thing, you know, on the side of the fence that they tend to add an expensive adversarial partner. But in this company that they almost brought a union in, and we had to work like heck, well, there was an a-hole of a plant manager. The manufacturing facility was getting toxic. People were not being treated, right. And in many ways in our debrief. It's, you know, we and I include myself because I'm an advisor. So we earned that labor union coming in to tell us to smarten up. We had, we had screwed up, we had had some of the wrong people treating people the wrong way. And the union's there to say, hey, that's not okay. Which, at the end of the day, they were able to turn it around. But it was basically the whole plant was starting to have Mondayitis because the plant manager was such a jerk.
Brad Giles 19:20
You know, Jeff Bezos has got this saying, which is your margin is my opportunity. Okay, so he looks out and he looks at the industries where there are healthy margins. And he says, your margin is my opportunity. And what I'm hearing through what you're saying there is that if you have a weak culture, if you have a toxic culture, if you have a culture where Mondayitis is present, perhaps that is the labor unions opportunity. Like they see that as being this is our opportunity to go in there. And to fix this from their own perspective. We could win pay rises, We could get in there. So yes, yeah. It's almost like chaos theory where if you run a toxic workplace, eventually, there will be a third party or something else will come in to try to rectify that.
Kevin Lawrence 20:22
They will. And you know, some of your best people will leave. So look at the end of the day, you know, these are problems that come into our world. And we got to be careful because we don't want this to become a contagious thing that spreads. And it does, and it comes in bit by bit. And then we get a wake up call, and we do something about it. And our job should be to be proactive and stay ahead of this. So yeah, let's dig into some causes we got, we got seven main points, which we have here, which is we look at what are the causes, and then we've got some solutions.
Brad Giles 21:02
So number one, they could actually just be sick, they could actually be cooling in Monday. And this is not only about people who are having the day off, let's be very clear about that. This is about people who are almost actively disengaging on on a Monday right there. Now, if you've got high vacancy rates on a Monday, or people who are away on a Monday, then that could be an extreme cause, but this is just people are disengaging on a Monday. So number one, they could actually just be sick, or they could be tired from just partying too much on the weekend, or having too much fun. Or, you know, maybe they went on a trip away. I remember when I was younger, I used to race cars, and we'd be racing cars at night. And you know, we'd be getting home at two in the morning or something like that, after having a full day's work and a full day's racing at night. Either that for a day or two in a row. And plus, we'd have to drive off into the country to do it. So you know, you can be pretty exhausted. So it could just be that they've got a really active social life outside of work. And, yeah, that's interesting to know, as a leader.
Kevin Lawrence 22:17
Interesting. I had a flashback there, Brad. I remember being out all night partying with my friends one night, and then rolling into work the next morning and going I don't think I'm in the condition to be at work. And, and just do. And, you know, we're still showing up, I was not the type of person that would call in sick, but showing up. But yeah, not with all my faculties as for sure. So yeah, that could be caught, they could have just learned that there are people that are so committed in their personal life, their person life is so busy, there's no there's not a lot of energy left for work. So that's you know, so the solution to that is, you know, just have a conversation with the person, right? You can if you notice the pattern, Hey, what's going on? I'm noticing, you know, what can we do to have you ready to go bring in your best foot forward Monday morning, for some people, you know, there's a Sunday night routine that people do like I often do to get ready for a great week. Or there's things to set you up to win. And that's where coaching and, and offering guidance can really come in with your people.
Brad Giles 23:25
And that's a really important point that I picked up that you said through that you approach the situation as a coach and not a manager. Okay, so we're trying to encourage managers to act like coaches or to be coaches not in what we do not external advisors or coaches. But if a manager was to deal in a management type thinking manner with an employee, they'd be saying, if you come back to work like this, again, you're fired. But what we're saying is, what can we do to help you? This is a question because coaches ask questions, what can we do to help you arrive at work, so that you're in the state to be productive and to deliver the results that we need as a team and that you've committed to? So very different approach to approach it as a manager instead of a coach? And we're advocating for the coach style approach where you're asking the person questions. Yes. And
Kevin Lawrence 24:27
so people wouldn't have had role models or experience of sometimes. And if they're early in their career, they might need some guidance, let's just say, cool. So the second one, is they're sick of dealing with their aihole boss,
Brad Giles 24:39
period. Yeah.
Kevin Lawrence 24:43
I don't know if you ever had one of them. Yeah, you know, I had I've had a couple clients that were like that. I actually I had a boss I couldn't stand when I was I will not name names. But I remember she I had a previous Boss, that was amazing. And then they brought this new person in, and I could not stand her. And I think it was mutual. She couldn't stand me either. But we gradually warmed up more over time. But having a boss that you don't like, is about as dreadful as it can get.
Brad Giles 25:20
I know, a client that I work with a CEO, he told me a phrase maybe a month ago, which was, which was pretty, which has really stuck with me. And that was that hurt people, hurt people. Okay, and it seems so simple. But I thought back when you asked that question just then and I thought, yeah, I had a boss and, and this boss many years ago, he just was an angry person. He just, he just felt like, the only way was to shout, not at me at everybody. The only way was to be angry. And, and he took delight in, in causing people embarrassment, or, you know, on happiness he just took and I just thought instantly, I thought you know what, he's just a hurt person in some way. And he's that's how he's playing that out. And so the people yeah, they used to, fortunately, it was a situation where you didn't have to interact with him all day. It'd be once or twice a day. But yeah, we would want to do anything at all to avoid that person. Everybody would. So yeah, I think that I think that this is number two, but it's probably one of the biggest issues is, is a boss has a job to do. Let's be fair, right? They need Yes, hold people accountable. They need to get productivity out of people at an acceptable level. That's their job. But what I found, what I observed through my career is that there's no, that is only on the job training. It's very, very hard to find a cause or some way. Yeah. So this is how you transition from being a worker to being a supervisor, to being a manager, and how you handle people, it's all on the job. And many people have this vision of Well, I've just got to yell because like my dad, you do whatever it is, whatever they roll more, or a
Kevin Lawrence 27:34
manager early in my career yell that was a role model. I've worked with a lot of bosses that were jerks that we've had to stray note and coach them I had, I was talking with another entrepreneur, but this last week, he's very successful, but his team is having a hard time with them. And he's stuck in this growth, because he doesn't know how to manage high performing leaders. Managing frontline technicians is a different skill than hiring or leading sort of high performing leaders. It's very differently and there's a my favorite quotes is that, you know, it's leadership is getting people to want to do what must be done. Yes, management meant management is getting people to want to do what must be done. And that's a skill. And if you aren't highly skilled on this, people, you know, people are gonna have a hard time working with you. And that's why, you know, as we were prepping for the show, one things we talked about is, you know, this is wonderful book called multipliers by Liz Wiseman, that has you be able to self assess whether you're a multiplier, which is you multiply talent, or a diminisher, or you make people stupider and smaller. And at the end of the day, it's not rocket science to figure out who people would rather work for. Not only do multipliers attract talent, and grow talent, because people want to work with them, because they're there. They're coming from a place of belief and respect. And, but we all can have, you know, diminishing tendencies, we can all be a bit of that aihole boss sometimes and not even know it.
Brad Giles 29:09
And that's and that's, that's such a fantastic concept from Liz again, there was Liz Wiseman's book multipliers, where, where some leaders multiply the smarts of some people to give it a slightly different phrase or perspective, and others shut down the smarts of other people. And then and so if you have a diminisher boss, which is shutting down the smarter people, rather than multiplying the smart if you have that type of boss, it can be a real drain as a person under the diminisher boss. And we actually spoke about a very similar concept a couple of episodes, which is the concept of a genius with 1000 helpers. I think that was Episode 49. For us, where, you know, if you are the helper or one of 1000 helpers, to use the phrase, under a genius, it can be really, really demotivating and could ultimately contribute to you not really wanting to go to work every day.
Kevin Lawrence 30:18
Yeah, I guess it can be melted, mentally exhausting. So, point number two's sick of dealing with their aihole boss. And that could be you in ways that you don't even know. And if you have those kinds of people on your team, which sometimes we do, your job as a leader is to is to not allow those people to keep that behavior going. Because it can become contagious and mess up the whole culture. And it starts it can become almost acceptable to treat people that way, or just drive a lot of people crazy. So let's go on to the third one. So the first one is they're actually sick or tired, just oh, they're over, you know, they're exhausted from their weekend. Second is their a-hole boss. Third is sick of the work being so damn hard. And there being so much friction in the systems and or just a nightmare to get things done. And whether it's because your business has grown, and there's complexity, whether it's because your software systems are clunky and messy, whether it's because there's so many mistakes, they have to keep doing things over and over again, or whether it's cuz they don't really have the resources to do the job. Somehow. The work is a hell. That's the that's another reason why people wouldn't show up. They're not gonna they don't want to show up to hell, first day on Monday morning.
Brad Giles 31:37
What we're specifically not saying here is that they we're not saying that they don't want to work hard. That's not what we're saying. What we're saying is that no, we make it hard for them to do their job. Because I make it harder for them to work hard. We make them yeah, yeah. It's like, if you talk to them, and you and you, you know, and they talk about systems that don't make sense, like, why do we do that particular process? This doesn't make any sense. Why are we doing it that way? We complete these forms. And they don't end up going anywhere. There's, there's no point to it. And often we always have
Kevin Lawrence 32:20
Brad, but that's the way we've always done it. That's why we do what we've always done it that way.
Brad Giles 32:26
And if that's what you're saying, like there's a whole episode that we can talk about that right? Number one, be humble and always try to find a better way. This is very common. And I don't want to single out a employer. But this is, but I will. But this is very common in government bureaucracy, which is people find it very hard to do a good job because the size of the you know, the bureaucracy protects itself. And there's a lot of work that gets done for no real purpose or reason or outcome.
Kevin Lawrence 33:10
Yes, and, you know, bureaucracies, build systems to protect themselves from really incompetent people. That's why bureaucracies exist you have. So instead of dealing with the incompetent people, you build cumbersome systems and duplications and 14 sign offs, and three approvals and all kinds of stuff. Instead of dealing with the core people issues, that's a whole other episode on bureaucracy, but we don't even want to talk about it that much. But yes, you end up with the systems. And that's why many companies that we work with, I know with you, they will have many of their there's their execution plans are about streamlining and improving systems. And it's not just Hey, we're gonna buy a new software package. Because that's just a way to spend more money. It doesn't necessarily, you know, if you've got a crappy system, and then you automate it, you've automated crap. Like it doesn't heal, you need to improve the systems, streamline them remove friction, from the perspective of the user, not the perspective of head office, getting the reports, but the people in the field doing the job. And it's, it's a forever project, just to continue it at that at the frontline team level through the whole company to keep streamline to make it easier for people to do great work.
Brad Giles 34:31
Yeah, there's one team that I work with. And they thought that they were going pretty good. They were pretty confident. But I got a bit of a sense that what was being said at the leadership team level may not be exactly the same at the level below them when we got to what was really happening. And so we ran a workshop and I asked them the question as a group, the say there was about 20 people in the room. And I said, So tell me, what's the, what's the one thing that prevents you doing your job better? And so we went around the room and everyone got to have a say, and they'd be one thing, one thing. Okay, what else? What else? And we went as far as we could, we had this massive list of things. And then I said, Okay, so we got to vote on one. What's, what's the one, we drilled it down to one thing. And then, so we got this one point. And it was that in the business, they had all of these processes and flows, that would work. But it was incredibly frustrating, because other people could disrupt that process in the workflow, if you know what I mean. So sales, people could come in and say, I've got this urgent job, I want that to jump in, like at the front of the queue. And so that meant that they couldn't trust the deadlines that they talk to customers about to get things out. And the whole workflow was being completely disrupted. And it just kind of evolved over decades into that system. And everyone, all of these 20 mid level managers say like, this is just driving us crazy, because we can't trust the system that we've got, we don't know where our customers job is. Because someone comes in with like a three day or five day project and plugs it right in front of at any point. Like we it's, it's, it's completely terrible. Now, now, all the leadership team, they didn't really even know that this was such a big issue, or the number one issue. And that was incredibly demotivating. For these mid level people who had to fight these barrels on a constant day with the people who were the customers who just wanted to know when is my, when is my product going to be ready.
Kevin Lawrence 36:59
So and it's a massive project to go and streamline that, like, yeah, don't dig into it, because it becomes a beast. Right. And they become so I we have one in a company we're working with, just like what you described, we're and we've gotten good people that want to be accountable for stuff. Interestingly, the person that has taken the most accountability and run with it is the wrong part of the business to run with it. So not only do we have to streamline the process, we have to shift where accountability sits for different things in different decisions. And there's a whole bunch of change management required Never mind figuring out a better way, and being open to changing the old, but then dealing with it the resistance that you're going to get and the and the people's pride that will be bruised. But those things are critical. So that, you know, the the the advice that we would leave you with on this is, you know, systems critical systems that allow people to do a good job, because people take pride in their work. They need constant improvement constant for the until the end of time. And you know, you just got to make it.
Brad Giles 38:08
Yes, feedback, people who are using it,
Kevin Lawrence 38:11
yes, from the user. So the final thing I'll say is, if you're it wants to go and streamline the process, or someone from the corporate office wants to go and do it. That's real sweet intent. But they're not the one who has to use those systems every day, you have to have the voice of the users in every conversation. Because those other people have good intentions. They're just disconnected from reality, or they have different priorities. So let's move on, shall we? They know the next one, number four. And this is also very common, and I have experienced this, but they're sick of working with a toxic person on the team, or the whole damn team is toxic. Usually it's one, one or two that start to contaminate the team. And it'd be there's dread and I don't leave a few Have you ever been in a meeting or a situation where you dread having to go into a certain meeting, or working with a certain person because it's just gonna be a headache?
Brad Giles 39:11
You know, 1% of the population is psychopaths. 15 to 20% of the jail population is psychopaths. In companies, about 3% of people are psychopaths. And the further that you go up the ladder, the higher that percentage increases. So that means if you've got a company of 100 people, statistically, you're likely to have three psychopaths in the business. Now, that doesn't mean that you do maybe they're not attracted to your industry or maybe you have an effective hiring and onboarding process. It's going to filter those people out. Yes, but we all have to work alongside tough people and you Yeah, when when we've got a toxic person on the team, like, it's just like a virus it spreads. You know, misery loves company. We've heard that saying before. And yeah, we've got to understand through things like the net promoter score, the employee Net Promoter Score component of that, or other employee satisfaction surveys is a good way to begin to understand what is actually happening. And when you see those things dip, that could be a real problem. But you know what, I don't want to work alongside a psychopath, I don't want to work alongside a toxic a player or a C player, like, it just drains my energy, and it makes me feel like I don't really want to go to work today. And that's what most people would feel in this environment, in this on this item
Kevin Lawrence 40:53
100%. And so as a leader, we have to keep an eye out for it. And watch out for those toxic people and don't promote the toxic people. Right, that's one of the things that we do is, you know, ideally, quarterly talent reviews where we review the whole portfolio of the most important leaders, all the leaders are the most important ones. And just make sure that they fit the culture, and they perform well. But it's the ones who don't fit the culture, and we know who they are, because there's always problems and drama with them. But our job is to not allow them to keep their role. And definitely not to promote them with that bad behavior and deal with it. Because at the end of the day, creating a great work environment is a setup for creating great work. And if you don't have an enduring, great company, you have to have an environment where people can feel good now. And sometimes people go toxic, we just, we just got to be on it, and not allow it or you know, encourage it by promoting it. So toxic people to toxic teams, you know, we got to be there to help them, make sure we manage it and don't allow it.
Brad Giles 41:55
And most of the time when you let someone go for performance related cultural issues. In other words, they're not performing according to a culture if they've toxic, everybody around them is going to go thank God for that. Like I know, they're like, why didn't you do that religion ago, it's a massive relief for everyone around them. And there's no one thing that
Kevin Lawrence 42:18
we you both you and I are fierce with the companies who work with people that are toxic, ie they don't work, play well with others, according to your culture. Give them a given feedback, let them step up. If not, thank you for your time. Like, you know, and and and sometimes it takes a bit of time to create a an appropriate exit a respectful exit, if that's appropriate, which it usually is. So yes, don't allow toxic people's people sustained leadership or management roles, don't promote them.
Brad Giles 42:47
So on to the next one, this sick to their stomach of dealing with a conflict or an embarrassing issue. Now, this could be with another team member slightly related to the last one, but perhaps not, maybe there's a conflict. This could be with a project, it could be with a customer, it could be with a supplier, but it could be with something else. But this could be something in the workplace some issue. That is that is just draining their energy way too much. Now, maybe it's just Well, you know what, that's your job you need to deal with it. Or maybe it could be that this is such a big problem that I don't know, you, you as the leader need to step in, I think about one of the entrepreneurs that I work with head they had a very large project. And on this project, they had a fixed price component to do their job. But their client had do and charged component. Right? So the client object sole objective was to make this thing last as long as possible and to draw out any issues so they could get as many hours as they can sold. Whereas my client, they had a they were we want to get in there and we want to execute it. It was just I didn't necessarily know that at the outset. But it was just such a draining exhausting.
Kevin Lawrence 44:26
Yeah, they were set up to calculate conflicting priorities or what a wind looked like to each of them actually would create it would crater engineered a conflict.
Brad Giles 44:35
Yeah,
Kevin Lawrence 44:36
yeah. So these stressful situations exist all of the time, and they're always there. And our job is to try and help one minimize them, or the way things are set up and look for, you know, conflict that is there. And then secondly, once we do see it conflict or an embarrassing issue, how do we get it on the table quickly? resolve it quickly. And for example, with conflicts, the number one solution is to get both of the parties with the cliff conflict into the room with us a more senior person and talk it out. Period. Yeah, like talking to them individually. That's only good if you're gonna then have a joint conversation. And a lot of people make conflicts worse by Oh, what did you think, oh, what did you think and trying to broker a deal? versus get them in the room? And, and get them to work it out? That is it and fast? Like Don't let it faster? Don't let it fester.
Brad Giles 45:46
And so number five, they are sick. No, no, no, no, we're on to number six, excuse me. They are sick mentally, and they can't handle the thought or muster the energy. So about the amount of work that they need to do the first item was around, they're physically exhausted or sick from the weekend. But here, you know, they're just having mental health issues. I think we've spoken a few times before on this podcast about everyone experiences mental health issues to some degree. And it's often not a case of well, you just need to toughen up, you know, just hard enough. Get a bag of concrete, Kevin and eat that bag of concrete, toughen up, and you'll be fine.
Kevin Lawrence 46:30
And then is that an Aussie thing? concrete and you'll be fine. I've never heard that one.
Brad Giles 46:36
Yeah, I don't know if it's an Aussie thing. I have certainly heard it before. Really? Yeah.
Kevin Lawrence 46:43
But as a taste, how does concrete? Have you tried it?
Brad Giles 46:49
I haven't. But I know that it can be quite acidic when you get it on your hands. So I imagine it would be quite painful to eat. Not that I'm going to try that.
Kevin Lawrence 47:01
Okay, but the poor thing. And we're not advising you. I'm just quite curious about Brad's story. But yes,
Brad Giles 47:06
yeah, so what we're really saying is it everyone, this is an everyone, everyone has a body and a mind. And sometimes the bodies can be unwell. And sometimes the mind can be unwell. And, you know, like, it's a perfectly normal part of being a human, we need to work through these things. So if, if that's the case, like we need, we need to just identify that sometimes you've got really fantastic team players who are going along, and then suddenly something dips, maybe they're having problems at home, maybe this, who knows what it could be. During the COVID crisis, we often saw a few times we spoke about giving them a free pass, you know what, like, this is such a terrible situation, maybe we just need to give them a free pass for their performance or coaching issues, coach them around, and then you know, support them and move forward knowing that that's inherently who they are. They're just dealing with a tough situation. Thoughts on this, Kevin?
Kevin Lawrence 48:14
Yeah, well, in my book, your oxygen mask first one of the chapters while there's a chapter on mental health and helping you to recognize when you're mentally cooked and exhausted and burnt out, and you're gonna have a version of Monday, itis when you're like, that happens to all of us at times. And if that's the case, he has two things. One, if it's really bad, like, you know the orange or red zone on the mental health continuum, you know, seeing a psychologist is usually the best advice as a way to help unpack those things that are that have cooked your brain. Secondly, is what I call resilience ritual. And sorry, the other one is your doctor, you know, I go to a naturopathic doctor, when I get burnt out, he helps to reset my system and get me back on track psychologist helps you to unpack the stuff. So those are two things. But then there's another chapter. In this chapter three, it's called resilience rituals. What are you doing? and Brad, you mentioned the body in the mind, what are you doing to rebuild your resilience? Sometimes you actually have to have a recovery period to rebuild your strength because you've just worn yourself out depleted yourself. So there's no for body mind and spirit. What do you do and it's interesting, as I've been talking to lots of people that have had a tough time in the last year and been very worn out and falling into this where they didn't want to go to work or their you know, deal with whatever is the amount of people that got burned out because what they used to do for their own resilience changed. Some places gyms were closed, you know, you couldn't have dinner parties with your friends, you couldn't do a lot of things. And so figuring out what you need to do for your own resilience is critical. It's why I bought a motorcycle last year I needed to get out and move because I could see the with the way the rules were wouldn't be able to do a lot of the other stuff I would do. And I knew I needed to do some different things to stay strong. Point being, is that when you are mentally burnt out or cooked, you typically have to find a reset yourself. And you know, because you might not be having the best impact on your team and such as well. But reset yourself. So, you know, take care of your mind, body and spirit, potentially psychologists potentially a doctor or naturopath or whatever it is that you use.
Brad Giles 50:30
Yeah, and so I guess the advice around that one is one thing that you mentioned, which is the mental health continuum. So as a leader, we're a big fan of this tool. You can google the phrase mental health continuum, and it's a spectrum from healthy to unwell. And it says, It asks to look for the behaviors, the observable behaviors in an individual in our in this context, who may be a part of your team. And it asks you what number of these behaviors are they experiencing where on the spectrum, and then it kind of advisors what to do. So you know, there comes a point where if they are unwell, as you said, we want to send them to a psychologist to help them to work through that. And then it could be a bit of time off or whatever it is. But the mental health continuum is the tool that we recommend, if this is what you suspect in this area,
Kevin Lawrence 51:34
for sure. And you know, and then if you need professional help, just always get it, there's experts for that when you have a medical emergency, you go to the hospital, and when you have a mental emergency, you should go to a psychologist. Yeah. Awesome. So then number seven. And this is another case, and it's no slightly different from the others. This is just an when, when people are tired of feeling like sick and tired of feeling of failure. And they know they can't win. And you know, they want to crawl into a hole, or they're out looking for another job now. And if these are people that were mis hires, and you as a leader or company made a bad choice, you know, it's probably great that they're out looking for another job, and then maybe calling in sick to go to a job interview or do the resume or who knows. But it's also a sign that if you have people that are failing and floundering and you're not dealing with it, you're not doing the best for your people it's like, and that's not that you put them under misery you're supposed to, you know, when people are failing, are you having the conversations and helping them to get back on track. And if you come to the realization that this isn't likely going to work, you know, they're there, they're not going to love this job or thrive in this job, you'll have a conversation with them about making a change, we're adults, you can talk with them about going and finding a job somewhere else, or maybe transferring to a role that would be more appropriate for them if one exists in your company. So just people failing, and that doesn't feel good. Everybody wants to be proud. Everyone wants to do good work, right? Most people want to do good work and feel proud. And that sometimes it can be us letting them down as a leader because we're not helping them to succeed or to move
Brad Giles 53:20
well as later on a scale of one to 10. If you're thinking about an individual, how would you rate them in terms of their understanding of how to succeed in the role? So if you're giving them yeah, they understand like we've given them everything training and training and coaching and training. And we've, we've, we've documented the systems like we could not do a lot more, well, then that's interesting, okay, maybe they're just not the right person for the job. But if you're giving them a four, or five or a six, that's a different conversation. And that really comes back to you as the person's leader or manager. Because as the person's manager, you need to get them to understand how to succeed in a role if they don't understand how to succeed in their role. And that's kind of on you. They are, you know, they are there to do their best work. If you're not telling them, this is how to succeed. It's a real, real problem. So it couldn't actually be on you. And then there in terms of opportunities to resolve this. That could be a case of, you know, maybe it's early days there, you could reignite your onboarding program. Or maybe you could just begin with an overall training program or something. There's some way to get them to understand their role more or even some one on one coaching between the two of you.
Kevin Lawrence 54:52
Yeah, you need to remove the variable of them having the right leader because if there are a couple of layers down from you, you don't know Know how much they were trained to the coach, take a salesperson, you know, if a salesperson hasn't spent a lot of time doing role plays with their manager, especially a new salesperson. And they haven't done a whole bunch of shadowing with salespeople and haven't had, whatever the proper training and development program is in your company, they could be an amazing salesperson, but without the right training and resources. And that's why we like to always do a double check before we assume that the person is no good. Have we done right by them. And then we can sort of say, hey, maybe this isn't going to work, which is, you know, that's what a performance improvement plan is, or a pip as they call it. It's to map out, okay, here's the things you need to do to win. Let's figure out how we can help you with these things. What are you going to do? What can we do? And then let's get back to winning? Yeah,
Brad Giles 55:49
yeah. Awesome.
Kevin Lawrence 55:51
the theme of this today is if we go back to the initial is, you know, is there a pandemic of Monday this in your org? And if so, what can you do about it, and we've gone through and, and looked at this, you know, this thing where people just don't want to come to work, or if they do, they're coming partially engaged and not fully excited to do their best work. And we've talked about how it's, it can be very contagious, and what it could, especially if you're the CEO, but it can be very contagious, if it starts, you know, spreading all over the place. And it becomes the default of the culture, which is a not a happy place to be. And we had some points, Brad, you want to kind of walk through one of your things.
Brad Giles 56:36
Number one, what causes it, it could be that they actually secretory they've had a big weekend. Number two, they're sick of dealing with a whole boss, their boss is not making their job easier or better, it's actually making it a lot worse. Number three, they're sick of the actual work being so hard to we're making it through our systems and processes, we're making it hard for them to do a good job. And for the sick of the toxic team members, or the toxic people that are on their team, and that they're like, you know what, I'd rather be anywhere else. And five there, they've had enough they seek because they dreaded, they've got a conflict, or an embarrassing issue. It could be a project could be a client, it could be something that they've committed to doing. And it's embarrassing, or it's tough. And it's you know, it's a terrible state that they just have had enough of number six is that they're actually there, they've got mental health challenges. There's this sick mentally, and they're, you know, they're not operating at their best. And then number seven, of course, they're sick of feeling like a failure when not helping them to understand how to succeed or giving them the support that they need to succeed. So yeah, if Monday itis is a challenge for you in your organization, a couple of good ideas there and what to do with it. But you know, the thing that you definitely can't do is just let it continue to fester. We want people to come to work, excited to come to work that you know, they're not going to dread the Monday they're going to go cool. I'm looking forward to a good week not be like, gee, it's Monday lunchtime. I've only got four and a half days to go. That's the worst scenario
Kevin Lawrence 58:31
that is not building an enduring great company for yourselves or for the people you work with. Awesome. Well, thanks for listening. This has been the growth whispers podcast with the awesome Brad and Kevin sharing our ideas of how we can make things better. And always trying to make things better for us and the people that we work with. So for the video version, go to youtube.com and for Brad evolution partners.com.au and for Kevin - Lawrence and co.com. Have an awesome week.
Podcast Episode 50 - Jim Collins Flywheel Concept
IN THIS EPISODE:
The Jim Collins Flywheel concept was developed in the book Good to Great. No matter how dramatic the end result, good-to-great transformations never happen in one fell swoop. In building a great company or social sector enterprise, there is no single defining action, no grand program, no one killer innovation, no solitary lucky break, no miracle moment. Rather, the process resembles relentlessly pushing a giant, heavy flywheel, turn upon turn, building momentum until a point of breakthrough, and beyond.
Kevin & Brad discuss The Jim Collins Flywheel concept in detail - and review how to create, validate, and speed up your flywheel.
In addition, they highlight how to leverage, measure, and optimize your flywheel.
SUBSCRIBE TO THE GROWTH WHISPERERS:
EPISODE TRANSCRIPT
Please note that this episode was transcribed using an AI application and may not be 100% grammatically correct – but it will still allow you to scan the episode for key content.
Kevin Lawrence 00:13
Hey there, welcome to the growth whispers podcast where everything we talk about is about helping leaders and their teams build enduring great companies, awesome companies, the kinds of companies that we want to read about for decades, kinds of companies, we'd like to work at kinds of companies that we actually like to do business with kinds of companies that really make a positive impression on the planet, and create opportunities for those around them, and great returns for their shareholders. So I'm Kevin Lawrence. And I'm joined today by my co host, Brad Giles, Brad, how you doing today?
Brad Giles 00:47
Very, very good. Thank you. Good and very interested to talk about our subject today. As always, we've got a word or phrase of the day, Kevin, yes. What is your word or phrase?
Kevin Lawrence 01:01
I'll let you go first today, Brad, I haven't had a chance to think about it. But I'd like you to go first.
Brad Giles 01:10
My word today is spiral. So I do a newsletter each week. And I, we were talking about this before the show, it's something that's been on my mind. So when we think about the work that we do, which is regular rhythmic meetings with leadership teams, it may look to other people that were just going around in circles wherever we made every quarter we made every year. And it's like, yeah, you know, like, they just come in, and they do the same things. And if you look at it only from one angle, yeah, it looks like you're going around in circles. But if you look at it from another angle, and if you think about a spiral that's going around in circles, but each time it's going up higher and higher and higher, it's actually a different perspective, because that's what we really see is organizations going higher and higher. Yeah, up in a spiral Up, up, up, up higher. So yeah, my word that's what's on my mind, I wrote about it this week. And I'm really been thinking, I have really been thinking about spiral.
Kevin Lawrence 02:23
And I mentioned to you and I was considered writing a book around that same concept, because I believe in it, because it's not only you have more perspective, in terms of being at a higher level, you have more insight, because you have greater understanding and intelligence about whatever it is that you're doing. It's a super-powerful concept. And that way, it's not Groundhog Day, where it looks the same. And by the way, if you're dealing with the same problems all the time, that means you're probably not building momentum, which something we'll be talking about today. So my word today, I'm going to riff off what you're saying is spy. And I was watching this interesting documentary series just for a little bit on the weekend, about spies, and how they get information on governments in particular. But we also know some of this stuff happens in companies. So not advocating, you know, illegal information gathering. But there, what's amazing out there is, is the amount that people will gladly share with you. And I remember an executive from a soft drink company that will remain unnamed, that I met in an airport lounge after he'd had a good half dozen cocktails. And until I joined them, you know, he was probably going on to seven, I was on one. And I'm curious, and holy, did he tell me stuff. And this massive global beverage company, he told me what it was like in the boardroom, because he was in one of those positions to put them in a boardroom. Wow. And let's just say, imagine two massive polar bears fighting polar bears, fighting, trying to kill each other. That's what it was, like in the boardroom of this company, and the stories that he was telling me, just, anyway, so the point is, is it's spy and that is, where can you legally gather intelligence about the companies that you competed most against or the markets that you're in? And most people underutilize it? And it's as simple sometimes as calling up a CEO of a competitor? And talking to them and having a willingness to, you know, get to know them get to know you and a lot of competitors do collaborate on some ways, right? Sometimes they have no backup supply for you today. So let's spy. How can you get additional information or have relationships that are transparent but beneficial. And by nature, you just learned a lot more. And so yeah. So you're sort of spiraling up. And I'm up there trying to zoom in almost like with a satellite image and get more information from that a greater height.
Brad Giles 05:13
Awesome.
Kevin Lawrence 05:15
So, today with our theme of spiral and spies, you know, what is it that we're going to dig in today that we are excited about? By the way, you know, for those of you listening, we, we've been talking about doing this episode for about four or five, six months, you know, and for a number of reasons, today is the day it's actually Episode 50. So I think our 50th episode, is that right? Today's is our 50th. Yeah, yeah, it's our 50th episode. And hey, for something that we had talked about trying for six or 12 episodes, right back in back in COVID. There, it's kind of cool that we're 15 do two more episodes, that's going to be the it'll be the one year of doing it. So, you know, for Episode 50, we're talking about something that we're quite excited about and is incredibly impactful for the firms that we have the great honor to work with. So Brad, on further a little drumroll.
Brad Giles 06:10
Today, we are talking about the flywheel. But let's be fair, you already know that if you're listening because you saw it on the subject of today. So we're talking about the flywheels are so important. Once you've built one, once you've built one, and you've watched it really embedded in an organization, a flywheel can be really, really important to clearly and simply and succinctly explain how do we get momentum within this business? So let's maybe begin with explaining what is it and I'm going to refer to some text with Jim Collins explains it, obviously it comes. Jim goes, Yeah,
Kevin Lawrence 06:55
this comes from him. This is Jim's. And let's be very clear, we are giving full credit to Jim Collins, who created this concept, did the research that discovered it and shared it with us, we're going to, we're going to share our insights of how to apply it and leverage it with companies. But this is Jim's invention.
Brad Giles 07:13
Okay, so let's dip in the flywheel effect is a concept developed in the book good, great, no matter how dramatic The end result, Good to Great transformations never happened in one fell swoop. in building a great company or social sector enterprise, there is no single defining action, no grant program, no killer innovation, no solitary, lucky break, no miracle moment. Rather, the process resembles relentlessly pushing a giant, heavy flywheel turn upon turn, building momentum until a point of breakthrough and beyond. So that's Jim's definition of the flywheel effect. And then so the flywheel is a series of actions that a business takes to create momentum.
Kevin Lawrence 08:15
Yeah, and what I would say and it's in this book for those who see the video is from he wrote a separate monograph on this called turning the flywheel just on this piece. I've got a wonderful signed copy here, which he was nice enough to sign. But in simple terms, I'd put it as it's, it's how do you build unstoppable momentum in your company. That's the idea. And a lot of companies don't, a lot of companies are constant grind forever, and there's always stuff to do. But then there are others that spiral up and scale and they build more power and more momentum as they grow. And that's what this is about. So it's about making sure that choices that you make, continue to build your momentum, but you got to know what builds momentum, first of all, and I'll share an example like in our own firm, Brad didn't talk about this specifically. But we worked on the flywheel a couple years ago, and then really nailed it. Probably just over a year ago with some stuff we did with our team. And then we started paying more attention to it. And, and things have spilled dramatically since that. We just refocused a few things that we were doing is, you know, we had caught up in being so passionate about what we're doing, and excited about it. But sometimes we forget and we get obsessed with doing great work for our clients, but that alone isn't enough. There's other things that it kind of brings and so's the strategy together. And that's really the idea of is it guides I've written it No, here's a guide strategic focus on the highest value activities and ensures you build self sustaining momentum. Time, that's the idea. So if you've got a business and it's going well, but you can't feel the engine of it getting better and self sustaining over time, you probably want to take a look at it.
Brad Giles 10:12
And self sustaining is really a key thing to think about when you think about the momentum. So the business is growing, I'm going to say on its own, but you're making the those key activities work. But that creates self sustaining growth, it continues to spin faster and faster. So the great leaders take it from one turn to 10 turns to 1000 turns to a million turns, and it continues to spin faster and faster. Now, the only way that you can do that is with focus and discipline and understanding these components, and not trying to build many different businesses.
Kevin Lawrence 11:00
Yes. And making it simple. And it's fascinating. You know, if I, if I look at, you know, clients that we've implemented this, and you know, they're sure we've had many, many CEOs go and spend two days with Jim in his lab in Boulder, and this is one thing he talked about, you know, with intensity and passion, a lot. And every single client came up with this as a homework piece. And we've since implemented it probably over five years and lots of companies. And you know, what's interesting, one of them that we did it in, we remember, we were sitting in a meeting down in Los Angeles, beautiful day, we're up on a rooftop deck, and it was a spectacular, as good as a day in LA can get close to the beach was all it was awesome. But we're going through and identifying the flow because the company got in trouble. And they brought me in when a company got in trouble. And so we're sitting there and we're going through the flywheel. We figured out their flywheel. And then we went and rated, how strong each of the areas were. And the look that the CEO had, was almost horrified. And I could feel the feeling in their body. And it was gut wrenching. Because the second or third thing on the flywheel was they rated it at a three out of 10. Yeah, then they went through and looked at where they had spent money in the last two or three years. And it was like a one out of 10. They looked at where they had hired people on the flywheel proportionally, it was like zero to 10. Because they, they actually, in the excitement of their success forgot a key aspect of their success. And they knew that they could rattle it off. But they had forgotten and when we went through and did the flywheel It was like, we need to invest more, we need to change more. We need to bring this back to life. We need to get the right person running this who is going to fight for the peace of the fight. What's the point of it is I've had many clients that when we go through and do the exercise, first of all, they're like, there's something that they make it a notable recalibration on. And that piece that is notably weak on the flywheel, they can see how it the direct correlation, how it's holding them back. So it's a health check in a reality check on your spooling of your strategy to make your business you know, spiral up, it's insanely powerful. And it's not the easiest thing to figure out. So what we're going to do today is give you some guidelines to help you to figure it out, so that you can get the benefit of having it and then making it part of your reality check that you do every quarter and every year.
Brad Giles 13:48
Yeah, um, and so I guess before we jump in further, we've explained what a hedgehog concept is. But I'd like to also just explain what sorry what a flywheel is, I'd like to also explain what a hedgehog is and what a smack recipe is, because we're going to talk about those things a little bit later on. So let's begin with a hedgehog concept is a simple crystallin concept that flows from the deep understanding about the intersection, think about three circles, intersecting in the center of Venn diagram, the intersection of purpose or core purpose. What accompany can be best that accompanies company's profit per x or single economic denominator. Then that so that's the hedgehog concept. Okay, we've spoken about that before on this podcast. Now a snack recipe.
Kevin Lawrence 14:47
the hedgehog is just a simple way to articulate what your business is about. And you know, what's the best in the world passionate about and what makes money those three things, the center of which It's your B hag, your big, hairy, audacious goal that you want to achieve over the next 10 to 30 years. So that is a core central basic piece and understanding. It's kind of like, you know who we are, and what are we about, in simple terms.
Brad Giles 15:14
So that's the hedgehog and then we move on to what we call the smack recipe. So that's short, for specific, methodical and consistent. So this is, again, about discipline. So a smack recipe is the code for translating a high level hedgehog concept into specific action, and for keeping an organization focused in the same direction, thereby building flywheel momentum. So again, it's about keeping the organization focused in the same direction. So the more that we can not get distracted, the more that we can maintain focus in the right direction. Understanding the components that make up the flywheel, the more that we can build that flywheel momentum.
Kevin Lawrence 16:01
Yeah, and that's at the root of most strategies is to stay focused on the most highly impactful activities. And as companies grow, they get diluted by interesting creative ideas, and basically dilute their force. And it's no different than if you have a bullet, you want to shoot at a target or an arrow, you want to shoot at a target. When you shoot it, if it splits off into 100 pieces, it's not going to have the same impact, versus one single projectile hitting a target is going to have more impact versus a kind of spray. And it's we want to keep the impact behind our actions. That is the idea. And again, these are things to help us so with a hedgehog in mind, and I even when we do it with clients, we even put the hedgehog in the middle and the flywheel around it. Right. And it was we're talking about the smack. There's probably a visual way to integrate the smack as part of it to help stay focus. So yeah.
Brad Giles 17:06
is the crazy, crazy thing, right? You already, if you're listening to this, you already have a flywheel. Yeah, it's already suck. It just might be a bad one.
Kevin Lawrence 17:23
It's like you already have a great idea, but maybe buried in the back of your brain mixed in with the bad ideas. there is there is brilliant ideas and all of our brains, but sometimes they get lost.
Brad Giles 17:36
Yeah. And the thing is, is that we are not making a flywheel. Okay, we are discovering a flywheel. And it's such a different way to think about it.
Kevin Lawrence 17:48
startup and you're trying, you don't even know which way is up yet and what your business model is. But with this, you know, most of them aren't pure startups. But if you've been around and already had some good success, there is a version of a flywheel. Now, it might be a weak flywheel, or it might have weakened or it might be awesome. But it's discovery to get clarity so that you can use decisions that constantly enhance it. So yeah, you already got one, it just it might be a positive one, it might be neutral. And it might be a negative flywheel, which Collins calls the doom loop in his work.
Brad Giles 18:24
Yeah, so let's go back to the spiral, you can have spirals which are going upwards, which is not the best analogy, but spirals that are going upwards and creating more momentum, or you can have ones that are going down and then the doom loop. So you can have positive or negative flywheels. The thing with it is that it's already there. Every business already has a flywheel, but most of the time, they're not focused on it. And they're not, they're distracted. And the absence of discipline around the flaw wheel means that they're not seeing anywhere near the kind of effort that they could
Kevin Lawrence 19:10
So in one of the companies that we worked with, the CEO came out a Jim session, he figures when he sold the company, it added 20% to the value of the organization because we could articulate the flywheel, and he sold it for a big number. So that was a big value But the interesting thing is, is that everything that we did if it didn't line up to the flywheel, we didn't do it. All of our acquisition targets had to enhance the flywheel. And if and even if they didn't fit within the flywheel, we wouldn't do them. There was one that slipped through that was bad choice but acquisition targets. Everything went back flywheel. Interestingly, when that CEO would address the company, as he did on a fairly regular basis, and the leaders, what he talked about was, aside from the culture, you know, the purpose and the values was a flywheel and hedgehog again and again, it was, for him, it was the most important thing. Because if we improve this thing, the whole machine improves.
Brad Giles 20:24
And you know, what I recommend, everybody in that organization would have understood the flywheel and they would have understood. Everyone tries to make strategy more complex than it should be.
Kevin Lawrence 20:44
Because they don't know what they're doing. If your strategy is complicated, it means you don't understand it, it should be able to make sense to a 10 year old kid, the best strategies or so basic, except for the ones that are complicated, but those usually aren't the best ones.
Brad Giles 21:00
Yeah, now,
Kevin Lawrence 21:01
and it's not that a mad brilliant, crazy, spectacular scientist, couldn't come up with potentially a better strategy. But if it's super complicated and intricate, even though it could be better, it's almost impossible toexecute. So a simplified version. and simplifying, you know, simply as you know, gentlemen, Mastery, my is, you know, my one of my favourite quotes is attributed to Mark Twain may or may not have actually been him, but we'll go with Mark Twain today. And that's, you know, I would have written you a shorter letter. But I didn't have the time. Right. It's hard to be simple and succinct, and simply, his simplicity is mastery. you can't scale something that isn't an insanely simple and easy to understand. It doesn't scale.
Brad Giles 21:53
Yeah. And so for that leader in that example, many times, I'm gonna say every time many times when he's communicating to the staff, what he's doing is reinforcing what's most important because people respect what you inspect, right? So the most important thing is, right, this is our hedgehog. And this is our flywheel. And this is how they work together. It's everyone gets it, everyone knows what the most important things are.
Kevin Lawrence 22:24
As long as you keep reminding them.
Brad Giles 22:27
Yeah, of course, the, that's the job of or part of one of the key jobs of the leader is to keep reminding them. So I want to give a quick example of a flywheel, which is Amazon. Okay, Amazon has a really simple flywheel that most people will get, because most people know Amazon. So it's got five components. Number one is lower prices on more offerings. Number two, if we do that have lower prices or more offerings, we can't help but have increase customer visits, more people will come because we've got low offerings. If we increase customer visits, we can't help but attract third party sellers. So there's more people on our platform, more third parties are going to want to come and sell. So already in these first three steps, you can see the momentum that this builds, then when we move to number four, we expand the store and extend the distribution. Now, if we attract those third party sellers, the previous point, we can't help but expand the store and extend distribution. If we do that we can't help but grow our revenues per fixed costs. So we've got more revenues per fixed costs. And if we do that, we can't help but lower prices on more offerings. So you can see as we go around that circle, how it builds momentum in the business, and how Amazon's grown to be, if not the largest, depending on when you listen to this one of the largest companies in the world, just by focusing on that really, really simple model.
Kevin Lawrence 24:06
It is and you know, and Jim had done some work with I think it was with Bezos. I mean he talked about this.
Brad Giles 24:13
He did back in 2000. I think it was
Kevin Lawrence 24:15
yes, there was when they talked here and here is I put the image on the screen out of Jim's book turning the flywheel for those can I find it there's a there's an image on page two of his book, but the idea is one thing feeds the next thing and before you know it, because it because they have lower the costs and then they can have a go back to the flywheel here. It becomes an uncontrollable for so because they can lower their prices they can get more customers, which gets more people wants to sell to them, which gets a better store, which grows revenue per fixed costs lower the price. lower price brings more customers brings more sellers who more stuff on the site, more revenue per fixed cost, lower the prices, and then it just keeps going and going and going. And to the point where, you know, there's this thing called monopoly, which mill people don't like where they almost companies pretty well control the market. So the idea with a flywheel in reality, what you're going to do is to push the limits to be such a powerful force, that it almost in other people's eyes is unfair, the truth is, you've just got such momentum, because you've been so darn good. So lots of that's a great, that's a great example, we have another client that has one, and I'll keep it generic. But it's basically as their flywheel goals, they keep getting to hire more amazing people who innovate, which the customers are thrilled, the customers refer stay, obviously, but refer other people. And because they have a larger customer base, they get way better buying power. So for them is leveraging suppliers and buying power getting discounts, because the buying power, they can invest more in people, which make the products and services better which thrill the customers which gets more referrals, which gets them a bigger client base, which gets more buying power. And then it just to the point in this company, they were number one in their space in the state they were in in the US. And it was a very state based business was a substantial company. They bought number two, and number two was almost relieved. Like, like, we talked, I would talk to some of the people in the aquarium cuz they're like, thank God, like we were done. Because they were such a powerful force. Yeah, now we bought that company. And we know we could have crushed them. But we bought it because we wanted to take the customers and we didn't want to fully destroy the company was good value to buy them and take over those customers. But it was a machine. And interestingly, their flywheel was so strong, but their product differentiation actually wasn't that strong. So when you would line their product up, and we did some work on that's another conversation, but their flywheel was so strong it, it almost didn't matter. They were just a beast. And interestingly, they got to 91% a players in their company. And there was hundreds of people. It was just a beast, like a beast of a machine. It was an army. It was unbelievable. Lots of lots of great things. And we can also talk about when it doesn't work. Go ahead, right.
Brad Giles 27:38
Yeah, so the product differentiation may not have been different all possible. But they were differentiating through their flywheel in terms of they were getting the simple things, right. consistently, all the time service.
Kevin Lawrence 27:56
Excellence. Yeah, their differentiation was better service. But product wise, there wasn't but their flywheel always around service excellence. Yeah, like just the best service you could possibly get in industry. It's just awesome examples and unders been the ones that go the other way. You know, and we tend not to work with companies like that. But companies who work with might go through phases, where anyone in the in when you don't have this or you have a negative flywheel. You're on Colin's map. So but the essence of it is you do something, it fails.
Brad Giles 28:33
Yeah.
Kevin Lawrence 28:34
Your people get disengaged or disappointed, then you just try anything. And usually it's hype and you're throwing spaghetti at the wall. It fails, your people are disappointed and you just flail and do something else. And the typical is you come up with some big slogan or, you know, a fancy outside CEO, and you're not strategic and you're not disciplined, you're just chucking stuff at the wall and hoping stuff works and you have good intentions versus getting back and grinding out as Colin says one of us favorite quotes from a session I did with him was you know, success is relentless execution of the boring basics that are within your hedgehog. The basics, like went to a restaurant last on the weekend and I ordered a couple things and the people that are really nice, but you know asked for water and they forgot to bring water for probably 20 minutes it's a basic you know, it's not rocket science. And I asked for my meal to be cooked a certain way and it wasn't and it was not a crazy request. It was a normal request. So you know where I go back Yeah, cuz I like the place and it's close to the people are nice. But you know the basics of bring water when a customer wants water and maybe it was a bad night. about who Oh, bad hour, who knows, and cooking something as it's expected. But if they do that two or three times, you know, they're not going to have a lineup for reservations, right? It's
Brad Giles 30:11
not going to build momentum. They're not going to build momentum. That's the thing. Would you recommend that to other people? Would you be a raving fan and an advocate? Would you go back? No. Because no,
Kevin Lawrence 30:23
I would give them another try. But the other tried the previous experience was awesome. But another try. I don't want to say their name. Super nice people there. But but but but I'll go over the tribe. And then after that, I'll probably start going, I go somewhere different.
Brad Giles 30:37
Yeah, because I went to a restaurant on the weekend as well. It was on the beach, like, so where I live, we have a sunset over the water. So you go to a restaurant on the beach, you look at the sun go down for dinner. It's lovely. So that was fantastic. Like, the fit out was lovely. The staff were pretty friendly, but the food was just okay. Like, it wasn't even like it was just a home. Right? So it's the What is it? How do you build momentum in that type of environment? Yeah, you have the sunset? Yeah, you have good staff, and you have food doesn't need to be like the best food in the world. It just needs to be yo is pretty good. Like, that's it. And that's the relentless focus on the boring.
Kevin Lawrence 31:22
Instantly good are pretty good. Yeah. And again, it's not rocket science. So basically, take a restaurant that's underperforming people would you know, change a menu, right? Or change a name or repaint a wall or got a bunch of staff out? Maybe it works, but at the end of the day, what does the customer want? They want what they've asked for, they want good, pleasant service, which this place has the service piece covered. It's not rocket science, but that people get lost in all of this other stuff. And it's from the eyes of the customer. What are the basics that matter the most. And that's and the fly will should point you in that direction. Something that that helps you to be thinking that way? Go ahead. So there's
Brad Giles 32:06
there's two, there's two problems that create this issue that creates the need for a hedgehog smack and a flywheel. Okay. And those are number one is the human brain doesn't like discipline, the human brain gets bored, and it wants to be creative. It really wants to do new and exciting things. to focus on the boring basics, the human brain is like, that is not what I want to do at all. But the second thing is that leaders are seduced by an endless search for the next big thing. And many leaders want to pursue growth for growth's sake.
Kevin Lawrence 32:52
Yeah, and that's okay, as long as somebody else is focusing on those boring basics to make sure they're right. And your strategy is pointed at speeding up your flywheel. It new can be good. But often, it's more dangerous than it is good for a lot of people.
Brad Giles 33:11
Well, it's no growth for growth sake, I often say
Kevin Lawrence 33:14
to people growth to become a better organization and better take care of your customers or your employees. Yeah, quality growth, not just growth. In other words, you fall on your face.
Brad Giles 33:25
Yeah. So you go, Yeah,
Kevin Lawrence 33:30
I was just gonna say, look, so how do you do it? You know, and then we talked about starting with a hedgehog and smack list. But you just go through and try and unpack and sometimes you have to go back five years in the business? What is it that drives this thing? What is it and the own? It's as simple as a brainstorm of trying to map out pieces. We like to get people sit on their own and think about it, then let's work on it as a group, what is it that drives this business? And the question is, you know, what is the language that Jim uses, because I can't help but can't help. But so for example, this other company we talked about, because we provide outstanding service experience to our customer, we can't help but retain them and get referrals because we retain them and and and, and get referrals, we can't help but grow the total number of users in our system. Because we have a massive increase on our total number of users, we can't help but leverage that for better buying power with our suppliers. Because we have better buying power and save that money. We can't help but be able to invest in more amazing people. Because it's we can't help but and really one thing really specifically driving Next now, we can't give you a paint by number, it's an it's a discussion. Sometimes you do one, you throw it away, you try, again, you try from three or four different perspectives. You know, sometimes there's one that's a customer oriented flywheel. Sometimes it's a product or r&d flywheel like, like Intel's example. Sometimes it's an employee oriented flywheel, and I'm sure there's many different types. But it's to start mapping it out. And because anybody can end up with four or five, six things that really drive into a continuous loop, like a flywheel that spent spools up,
Brad Giles 35:35
but it's already there. It's already inside your business. And the insights come from the hedgehog and the snack recipe. And those things are built using very specific methods that will give you a great and deep insight. You can't just, you can't just rock up and go, hey, let's get some stuff onto a page and the metal main will become Amazon, it just doesn't work that way you've got to do the thinking it has
Kevin Lawrence 36:02
a store trickly now, and again, those things may not be working at the time, sometimes they fall they fail. Yeah. But historically, this has led to this. So for example, one of the companies had made an expansion into the US. And it was going horribly, well, for a number of reasons. And but Canada was a wild success story. So we just went back into Canada, we went, we didn't even bother looking at the US. We went five years back in Canada. Okay, what were you doing when the growth engine took off?
Brad Giles 36:36
And what was it?
Kevin Lawrence 36:37
What were the specific things and we went through? And we made the fly when then we overlaid it to the US? And we're like, Ah, no wonder.
Brad Giles 36:45
that's why it's completely logical.
Kevin Lawrence 36:49
It is so obvious. But you're right, ready, he got to go back in time to map it out. So you go and map it out. But let's move on. So that's point two, how do you create it starting with the hedgehog? And the smack list is content go through and map it out? And then number Go ahead, Bing or something?
Brad Giles 37:07
And so how many flies? This is a great mistake that I've seen how many fly wheels? Should an organization have? Six?
Kevin Lawrence 37:14
814? How many would you like to have? I mean, you know, it doesn't really, you know, you know, it doesn't, you don't need to have one, you could you know, you don't need to be disciplined, you could just have a whole bunch because they're kind of fun to play with. You, you can also have 27 goals per person, per quarter. I mean, why wouldn't you have more, the better, more the merrier? That's a better party having 27 instead of seven, isn't it?
Brad Giles 37:37
Yeah. And that's cool, because then we'll get more stuff done. If we have 27 goals.
Kevin Lawrence 37:41
27 times the thing done, if we have 27 goals and 14 fly wheels, and we feel we should have like at least a dozen core values. And while we're at it, we should probably have seven different names for the company.
Brad Giles 38:00
So for those of you who may not have picked up there's a an a blanket of sarcasm that's just fallen over us. Let's remove that and come back and shake that blanket off. No, what we're saying is, you should have one flywheel for each CEO. One flywheel for each CEO. And why is that because you might have multiple profit and loss and balance sheets in an organization. Okay, but you're probably only going to have one CEO. And so I think about one organization that I work with now I've got two distinct divisions that work with different types of customers. Okay, one's more of a, let's say, a smaller customer, the other ones a much larger customer. But we've got a central flywheel that works across the entire CEOs oversight, then there's another business and they Yeah, they have got three different areas in which they operate. They're all in the same industry, but three completely different areas. One CEO and all of those, they have this same flywheel. So because sometimes the energy of the CEO you want it all to be going in the same way, as you mentioned earlier with your friend who, your friend, your colleague, your associate, who comes out talks about the flywheel and the hedgehog, relentlessly. One central point of focus per CEO,
Kevin Lawrence 39:47
I think so and that can be hard. Anybody can come up with seven or three, but to get down to the one flywheel that drives the whole machine. All of the assets that you have in organizations cripple now, teams might go and develop a flywheel a little sub flywheel, let's call it. But that's not the part that we're obsessed with. We're obsessed with the main one for the organization that drives the organizational strategy. You could have your logistics team that might think about it down and logistics, you know, in some organizations, you know, in a divisional level, they will allow them to create a divisional purpose, or a divisional B hag or a divisional, whatever. That's, we're not saying you can't, you might let people do it. But this is about the overall organization and the one that we all talk about regularly, just like the one company name, and the one B hag, and the one set of core values. I think it's super important. And companies sometimes that aren't good at simplicity will create multiples. So I think it's super important. I got so so. So one person, and then how do you know that it's correct? Right. And, you know, it's not rocket science. But you know, Brad, you and I are big on pressure testing ideas. And because theory doesn't produce value, it's reality that produces value. So the one that the simple pressure test is going through and saying, does this directly drive this? Or because of this? Is it true that we can't help but get the next one. The second is to go through and look at some of your biggest periods of success, or divisions or parts of your business that have had massive success or massive failure, and go and then pressure test. So was there something in here that was actually critical to our success? When we did well? And was there something in this that broke? That was, uh, that was critical to our failure? That's another way of pressure testing to make sure that you absolutely got it.
Brad Giles 41:58
Yeah. Does it explain your failures and successes or your successes and disappointments? That's the simplest test. When you look through those three to six items. Can you say? Yeah, well, when we launched in this market, or when we did that, or when we did that, like that absolutely succeeded because of that, or that absolutely. file because of that. Yeah. So. So that's the simplest way to validate it. It's correct. There's no, there's no enormous diagnostic that you need to take. Just ask. Can successes and disappointments?
Kevin Lawrence 42:37
Yep, exactly.
Brad Giles 42:39
Now,
Kevin Lawrence 42:40
now that we've so we've gone through, and we know what it is? We're pushing towards positive we've drafted it. We've validated it's correct. We know we've only got one. How do you speed this thing up? And this seems basic, right? But it's one of the things that actually speed it up. And you know, hold on to your hat. This is rocket science here. But it's, you literally make sure that your major goals relate to an area of the flywheel. Right now, if you've evaluated yourself, and you have one area that's really lowly, if that client to talk to you about when we had the meeting in California, you better make darn sure you fix that. Because that will every time the flywheel spins that one area it's gonna slow down because it's a weak spot. So you got to make sure you patch up your weaknesses and you know, shore them up with the right resources and get them back to success. But ideally, is that your most important your you know, your yourr goals you have for three years, we call them key thrusts or priorities wherever you want to call them. They should directly be linking to the flywheel. That's not that everything on your flywheel needs to be your three year goals. Your three year goals need to drive what matters and your one year goals and your quarterly goals. That's a simple, simple thing to look at. And, you know, if you can go and look at your plans often, Brad, you know, for you and I both when we go to a company and evaluate their strategy and execution plans, often they're all over the road. Yeah, it all seems like important stuff. But if you put it through the filter of the flywheel it might not make a difference. And even though they have beautiful intentions and awesome plans, because leaders
Brad Giles 44:21
are often seduced by an endless search for the next big thing, and they pursue growth for the sake of growth. And that means that sometimes priorities land on these 90 day or one year or three year lists that may not necessarily make sense.
Kevin Lawrence 44:39
Yeah, and sometimes leaders are seduced by the good old things right there's some are caught up in the shiny new there's all others that are caught up in the reliable old and that can be just as bad you know, we go into companies and and and our three year strategy in our company hasn't changed a lot in a decade now. That can be a good thing for some. Sometimes they've just they got stuck tunnel vision and thinking about their business and it needs a shake. So, again, there's no right answer here. The key is that you got to invest into those things that speed it up. And yeah, that's speeded up. And, you know, and the kind of the point number five, and it's a bit of almost maybe not needed, but how do you make sure you don't slow it down? Well, don't invest in things that don't speed it up.
Brad Giles 45:31
Right. Yeah, that's, that's obvious. And I would add to that, regularly look at it quarterly and annual planning sessions. So what color and this kind of will lead to our next point, but What color is this component of the flow wheel currently? Is it red or green? And then what do we need to do to get it to become green? Yeah, so
Kevin Lawrence 45:54
for example, last week, I spent all week virtually with my one of my clients in India, right. I think I talked to him about a little bit last week. They're like, they're like family. You know, when I saw his six nights, six evenings and my time, and one of our things that we did with the three directors that run through brothers as we go through and evaluate the flywheel. Where are we at? How are we doing on the different pieces? Now? How do we take that into mind when we set the three year strategy? You know, every quarter, or every time I meet with them, I know that we do twice a year meaning we go back and we get a report color coding the flywheel not only overall, but by division, which we'll talk about a little bit later. So yeah, which so which really leads
Brad Giles 46:36
us which really leads us into number six, the next one, which is how do you measure and we both touched on that, I've got one client that comes to mind. And we've taken the flow will really, really deep into the layers of the org chart. And so we've divided each of the components of the flywheel into what are the four things that we do that makes this component of the flywheel work, okay, so we've got to have salespeople having that KPI and we've got to have the operations, people having that KPI or whatever it might be. So across the floor, where we can look at it in its simplicity. But then we can look behind it to the things that make eight the KPIs that we need in each of the areas of the business to have that flywheel color green, let's say. And then beyond that, like you just mentioned, we're setting priorities at a 90 day or one year or three year level to get those, those KPIs to green. Yeah,
Kevin Lawrence 47:41
so Exactly. So what I've heard you say, Brad, is that you know that you have KPIs for each part of the flywheel. And even looking at that way, you can delegate it down to make sure different departments are doing their part to enhance that piece. So yeah, I've got one client, where they have one KPI for each part of the flywheel, I've got another that's got four, I don't really care how many you got. But you know, even when it has for the combination of those four measures indicated, and because of that, we can provide a score and coloring and you and I both love red, yellow and green coloring, just, you know, traffic lights basically did a previous episode on that on the podcast, but it's a simple way to evaluate performance. And, and, you know, and you know, which it's basic, but what's the reporting, and like he's abroad every quarter looking at it. And we'll talk about it in our in number eight about how do you tweak it? So So six is, you know, how do you measure it, KPIs and your red, yellow, green? And then number seven, which I started is how do you leverage it across multiple divisions or locations. So here, this simple, we've got one flywheel for the overall business, we take the identical flywheel without touching it. And we use it as an analysis tool on divisions or departments. So the client India, for example, they have, you know, just under 10 different locations that they work in throughout the country. So when we get the flywheel reports, we actually don't get summary data on the overall, we get the report on each different location, red, yellow, green, and where there's a yellow or a red a comment of why and what can be done to fix it by the person who runs that location. So the people that run the locations, which are like, you know, general managers of divisions, they know themselves to evaluate themselves on the fly wheel and they're being trained to come up with an action plan. So it's very simple. You just apply it as a filter to look at a piece of and the correlation in this company is in sane, it feels like a direct correlation between the flywheel and performance. Now, unlike anything, there's no not many things in the world are 100% Indirect, but there's an insanely strong correlation between because they've got it right between the colors on the flywheel. So the highest performing locations are generally green all around.
Brad Giles 50:12
So I would go as far as to say, not withstanding your last comment, I would go as far as to say, when the flywheel is all green, you're outperforming the market. In terms of growth? Yeah, um, yes,
Kevin Lawrence 50:30
you should be outperforming the market, or at least you're performing at your best. Right, like you are the dude, you are just you, you are excellent. Like, in most cases, you're probably outperforming the market. You should be Yes, I'm filtering my nose. We're talking about it. Yes,
Brad Giles 50:46
yeah. Yeah. out of thin air.
Kevin Lawrence 50:49
You know, I know that you don't, you don't. So but it's but it's basically, it's an evaluation tool. But the key to remember, this is not our corporate head office, let me evaluate you. You're training people to think about their business to be better, smarter operators in everything we do. Again, without spiraling up with everything we do, every person that we're we're almost subconsciously wanting to train them to be the CEO, or to move in that direction to be a better, more capable version of themselves. So the number eight, you know, how do you optimize it over time? And we've already said this, but it's, you know, quarterly planning meetings, looking at it, evaluate it, take that into account, when you reset your goals, annual planning to go really look at and say, What do we change something like I'm a big believer in once you lock down any strategic principle, you shouldn't debate it throughout the year, unless something's really gone wrong, should drop into execution mode, execute like crazy. And then when you decide it's time, then there's a period where you evaluate, and whether it's at a six month mark in the year where the executive goes off and works on strategy, or some clients do, or it's at the annual planning meeting, it doesn't matter what it is. But on those quarterly, you know, staying in execution mode, and then evaluate strategically whenever you do it.
Brad Giles 52:12
And ask, have we had any failures in the last year, or quarter but year? And does is that explained by our flywheel because sometimes you're adhering to the flywheel means that you will experience a failure. But you know, like, I go back to the spiral at the beginning of this episode, we're getting a deeper understanding over the years of our flywheel deeper understanding, deeper understanding. And so that regular rhythm and checking in makes a huge, huge difference.
Kevin Lawrence 52:45
Yep. I agree. And the thing I'd really want people to understand, Brad is, look, our role is to help facilitate companies that want to build enduring great companies and continue that growth path and get bigger and better continually. That's their that's their, their goals. And that's what we do. And we look at those lots of different tools out there. And I look at what sticks and continues to add value 235 years in the future. And the flywheel absolutely does. Yes, five years in the future, it's still insanely valuable, and we will never stop looking at it. It's, it's, it's incredible. And in companies that keep focusing on it, they generally keep getting better and better, because they're obsessed with the stuff that matters most. So should we do a quick recap here, Brad, and maybe I'll do one you can do the next I'll start with number one, I'm gonna go back and forth. So it's like a point number one point to remember is, you know, you've already got a flywheel, and either it's a positive flywheel it's spiraling you up. Or you could have a Doom loop that's keeps knocking you down. And yeah, that's, that's the first thing. It's already there. And our job is to discover it.
Brad Giles 54:04
Number two is, is you begin by understanding your hedgehog concept and smack list. So you look at those two things. If you haven't got it, then you build those before you build the flywheel you get a deep understanding of what works and what doesn't in those areas. That's the you know, that's the qualifier, the pre conceived,
Kevin Lawrence 54:25
right and those both are also principles, you'll still look at five years down the road. Number three is you got to validate it's correct. First of all, make sure you only have one per CEO Thank you very much. But each piece should drive the next piece and you should be able to say, because of this, we can't help but as it drives to the next piece
Brad Giles 54:48
number four, how to speed it up well, a relentless execution of the boring basics within your hedgehog. So ask the question, What color is it which we'll get to in a moment, ask the question But then relentless, boring, execute execution of the boring basic.
Kevin Lawrence 55:05
Yes. And find people that like doing that stuff that we might consider boring. Five, and it was kind of obvious. How do you not slow it down? Well, don't do things that don't relate to the flywheel and distract energy away from it, and evaluate on a quarterly basis how you're doing so you can keep tweaking it.
Brad Giles 55:25
Yeah. So and then number six, how do you measure and know that it's getting stronger, red, yellow, green, each of the components within the flywheel and then ask yourself, what are the key performance indicators that will tell us that we're consistently going to be green measured those and then build priorities that will help to give the business the ability to achieve those KPIs?
Kevin Lawrence 55:51
Number seven, how do you leverage across multiple divisions and locations? Well, you take the one flywheel, you don't make new ones, and use it as an analysis tool to evaluate and ideally, train the people that run that part of the business, to use it to guide their thinking and their actions.
Brad Giles 56:09
And then finally, number eight, how do you optimize it over time? Well, at annual planning sessions, rethink it. Ask yourself, have we had any failures in the past year? And is that explained by our flywheel have we had any successes is that explained so help the leadership team to get a deeper understanding of what the flywheel is doing and not doing and kind of continually stress tester? What a good episode this has been. So
Kevin Lawrence 56:42
let's make sure turning the flywheel the monograph by Jim Collins, go and read it go back to good degrade. And by the way, if you happen to be in one of those Doom loops, go back to what used to be my favorite of all Jim's books, how the mighty fall, this is a boat, the doom loop, a boat companies that make bad choices and stay in a negative downward spiral. Often until they either straighten themselves out with relentless execution of the boring basics, or they get bought.
Brad Giles 57:18
And quickly that turning the flywheel book is about a one hour read. Like it's Yes, yeah, yeah. It's a monograph. It's like 38 pages. I think.
Kevin Lawrence 57:30
You're such a precise brain. It's actually 37. And then notes.
Brad Giles 57:35
Yeah, so yeah, so it's a very easy read and see, it's very thin,
Kevin Lawrence 57:40
you can, you can probably read it before your plane takes off. If you're one of those people, that's back to traveling. So I were really gonna say Good thing, a shout out to Jim Collins, and thank him for this great research. You know, we rely on that research a lot in this and you know, and we're experts at implementing it in companies and bringing value to life. And we're grateful to have people that have created these concepts that are proven based on research, not just hypothetical ideas.
Brad Giles 58:12
Awesome. So thank you for listening. I hope you've enjoyed today's episode about the flywheel. This has been the growth whispers where we always talk about building enduring great companies. My name is Brad Giles, and you can find me at evolution partners.com.au and of course, my co host, Kevin, the Canadian with the extra cheese, who joins me every week, if you can find him at Lawrence and co.com. Thanks very much for listening. We look forward to chatting again next week.
Podcast Episode 49 - How Do You Become a Level 5 Leader?
IN THIS EPISODE:
Are you a genius with 1,000 helpers? If so, how do you become a level 5 leader?
Do you find yourself or a colleague surrounded by people who are helping, but not taking ownership? Do you notice that if you want to get a project done, then it's up to you to ensure that it gets done?
If this is the case, then perhaps you're an effective leader or a level 4 leader, but not a level 5 executive. In order to build a truly great, enduring company a level 5 leader is required. This occurs through a paradoxical combination of personal humility and professional will.
The problem is that for most leaders the capabilities necessary to get to level 4 will actually prevent them from getting to level 5.
In this episode of The Growth Whisperers, Kevin and Brad discuss the key symptom of a level 4 leader, what Jim Collins calls 'the genius with 1,000 helpers'. They discuss:
- The problems with being a genius with 1,000 helpers
- How it prevents the best people from joining your team and those who do from achieving their best
- The potential damages this causes to your business
- How you can become a Level 5 Leader
SUBSCRIBE TO THE GROWTH WHISPERERS:
Episode Transcript
Please note that this episode was transcribed using an AI application and may not be 100% grammatically correct - but it will still allow you to scan the episode for key content.
Brad Giles 00:12
Hi there, and welcome to the growth whispers, where everything that we talk about is building enduring great companies. My name is Brad Giles. And I'm joined as always, with my co host, Kevin Lawrence how are you today?
Kevin Lawrence 00:26
I'm doing great today, Brad, it's a good day, this is we're gonna jump right into my word of the day. And it's FOMO fear of missing out. And normally I'd be in India this week. So all week, I'm doing the night shift going from 6pm till you know, 12pm or 1am with my amazing clients in India. And then like my three Indian brothers, and you know, normally go to India once a year, and then go and we'd meet in another country, somewhere else in here. And so, we've been doing these virtual sessions, which is insanely efficient, we're getting all the stuff done. Like it's awesome. We just don't get to hang out and have half the time together. So today, last night, they had the evening before with their whole executive because they're meeting in person and they can do that in India. And then they got the two full days of strategy, which I'm dropping in to, you know, do a few things but I don't get to be there and hang out with with the with my three Indian brothers and my extended Indian family and which we always have a riot together. So yeah, I'm feeling like I'm missing out like I don't, you know, get the joys of the travel and, you know, the airplane time to think and such. But more than not the quality time with my family over there. And so yeah, it's a little sad and a little mad, like I'm missing. I am I am missing out. I'd like to think that they're missing out too. But for sure I'm missing out. So that's awesome. That's my word. FOMO is the word of the day. Okay, well, you.
Brad Giles 02:01
Yeah, so my phrase is surrender as a strategy, surrender as a strategy. Now, that's not what you might think. But we've got a case of it where I live. So we've got a state election coming up this weekend. Yeah, now, we don't normally talk about politics. And I've got no interest in politics. But I do have an interest in strategy. Okay. And so what's happening in our, in our parliament, we have like everywhere in the world, pretty much we've got a left and a right side of politics. The left side of politics are currently in power. And the premier of our state has about 90% approval rating. Right, absolutely crazy. We're 59 seats in the parliament. And he's likely to get like 56 seats or something like that. So the right, the opposition in the right. They've conceded the election two weeks before the election to say, yeah, I've never heard of it before. So surrender is a strategy. Really. They've said, we're not going to
Kevin Lawrence 03:09
know what the guy in the US did. He surrendered as a strategy is not how he approached it. Maybe it's becoming a new thing.
Brad Giles 03:15
Maybe it is the new black? Who knows? Yeah, it's, yeah. So about two or three weeks before the election, he came out. And he said, I concede, there's no way we're gonna win. This is a massive risk to democracy, if like, they're looking at only winning two seats of the 59 seat parliament, they said, this is going to be a really bad thing. So when you really think about it, like it's crazy, but at the same time, it's surrender as a strategy. He's given up and said, you're going to give all of this power to one person, this is going to be a really bad idea.
Kevin Lawrence 03:53
We could do a whole podcast on that one. Because it's, you know, it's it. There's another way, it's like, there's another saying your first loss is your best loss. Like, you made a bad choice, it ain't work and cut your losses now versus persisting to the end, and putting the additional energy and money into it. That's a it's not in our nature to surrender. That's why there's such a reaction to that one. I like that.
Brad Giles 04:17
Yeah, it's different. And that's why I made it my phrase of the day or word of the day, because it's just, it's something that you don't see. But you think, yeah, you know, it's the best chance that they've got to get the highest number of seats.
Kevin Lawrence 04:31
So what are you going to surrender to?
Brad Giles 04:36
What am I going to watch? What am I going to surrender to
Kevin Lawrence 04:41
need to surrender? Where do you need to surrender? Brad?
Brad Giles 04:47
I don't know if you're asking me or asking me rhetorically because I'm asking you. I'm asking, like, seriously, like,
Kevin Lawrence 04:54
what I'm thinking about myself.
Brad Giles 04:56
What am I gonna? Well, well, maybe the question is Where do you need to surrender to have to support your strategy?
Kevin Lawrence 05:08
And say yes, and where is and this will tie into today's show? Where is your ego in the way? Yeah, and not allowing you to surrender when it's probably a very logical thing to do.
Brad Giles 05:25
Because for that leader of Parliament, it would have, it would have been a very humble move to concede it, you know, like, you're not known for that kind of thing. It would have been a very tough decision. You know, one of my favorite books as I try to avoid your question is ego. Ego is the enemy by Ryan Holiday. I just love it. Yeah, I encourage all of my clients to, to read that book. Probably one of my top books in the last few years, actually, that is, ego is the enemy by Ryan Holiday. Yeah, because your ego does get in the way. It does preventing you from, you know, achieving what you really want. It's like there's a, there's a little somebody inside of you that's working actively against you.
Kevin Lawrence 06:16
Yeah, and your ego, there's a healthy part of ego that drives you to make amazing things happen. But then there's a toxic piece inside of there's another, you know, another probably one of my most impactful books in the last couple years is a book called, oh, positive intelligence. And the way that the author shoreside teaches that is you've got, you've got a sub A tour on one side, who's kind of a negative force. And then you have a sage, which is the wise one on the other side, like the devil in the angel, and they're fighting all the time. And whichever voice dominates or is loudest inside your head is the direction you tend to go. And this can be tied into ego, there's a part of your ego that's wise and wants to make a difference. There's your part of ego that is frail, and wants to protect itself and get you into trouble. So yeah, and in order to make a move like that, it would be the stage or the healthy part of your drive, that would get you to surrender. And so what did you say you were going to surrender to?
Brad Giles 07:22
Look, I don't know, I need to think about it more. That's the honest answer by Why don't you lead the way?
Kevin Lawrence 07:32
You know, it's interesting, I'm working on a project right now. And it's probably gonna cost more than I want. No, I already got the number, it's gonna cost more than I want. I was meeting with the contract of the day. And I'm like, Yeah, like that number. And so, you know, it's, there's a price in this world for the things that I want and the quality of things that I want. And so I think I'm gonna have to surrender that. I don't like to compromise on some things. And truly, that it's okay to, you know, that I'm going to probably spend the extra money to get what I want. I gotta surrender to, you know, Value Engineering, the project on stuff that I don't care about, take that cost out. But on the other stuff, that it's just okay. And if it really matters, then I should just pay it and surrender does what it's gonna cost. And don't worry about it too much.
Brad Giles 08:23
I probably got an answer to your question briefly, because I don't suspect you're going to leave us alone. And our poor listeners want to get on and hurt hear about the
Kevin Lawrence 08:30
listeners. Don't you want to know, what is our wonderful friend Brad going to surrender to? And yeah, little drumroll Come on. Here it is. Here it is. He's had a few minutes to think. And now it's coming. Here it is. Wait for it. Over to you, Brad. Appreciate that.
Brad Giles 08:46
Yeah, it's so it's not what I'm going to it's what I've already surrendered to. So I'm writing a book about onboarding new hires. And I've done a very large research study that for any author, the challenge is not to write a bigger book, it's to write a shorter book. Yes. So I've surrendered to omit things that are interesting, but not relevant, because effectively the objective of the book is that any leader should be able to give it to any manager who hires and say, just read this book. And it's got to be short enough. That's the overall objective. So I've had to surrender my intellectual curiosity and validating all these points through 25 different angles, to be able to make the overall objective.
Kevin Lawrence 09:35
Perfect. Awesome. Well, I was very interesting. So surrendering and FOMO, when I'm sure they're tied together in some way, but we'll leave that for another time. So let's drop into today's show. What what are we doing today? We kind of gave a hint to it when we talked about humility. So what are we digging into today, Brad?
Brad Giles 09:54
Yeah, a subject that one of us came across in the last week. That as soon as we communicated with each other about this, we both said Yep, absolutely. Right. So this is the concept of the genius with 1000 helpers. So it's kind of like the antithesis to true leadership, but is in itself a form of leadership, but it's like going to stop you getting to where you really want. So what we're saying is, Are you the genius with 1000 helpers? And if so, how do you get past this to become what we call a true level five leader?
Kevin Lawrence 10:36
Yeah, and in many ways, it's almost like, are you a genius period, without the caveat, because it's being a genius. Sounds good. You know, and being smart is good. Also, sometimes it's a pretty serious liability. So we'll kind of do and today we're gonna cover off, you know, Jim Collins, small around level five leader, we're going to cover that off. And then we're really going to dig into what are the common almost symptoms? Or what things that we see that cause people kind of to be stuck at a level four and not getting to the level five kind of where the best and even some of the costs, and then probably at the end, we'll get into some strategies to do it. So should we dig into Collins's model here that he doesn't stuff on this broad? That sounds good?
Brad Giles 11:22
Yeah. So Jim Collins, in his work, identified that they're empirically identified that there are five levels to leadership. And ultimately, that truly great enduring companies are built by only level five executives. So level one at imagine a pyramid at the bottom of the level of the bottom of the pyramid, pardon me, we've got level one, which is a highly capable individual, they make productive contributions through talent, knowledge skills, so they're good, they're a worker, okay. But they're individual, they're not necessarily they don't necessarily work great in a team, you know, maybe we slide pizzas under the door to them. Level two leader is a contributing team member, okay. So they contribute to the objectives of the whole group in a group setting so that they work well in a group, as opposed to the level one which really works well by themselves. Level Three is a comprehensive
Kevin Lawrence 12:25
before you move on, you want to allow me to share and for those that are watching the video, I'll flash the graphic of this on the screen, if you wanted to set me up to share. Forget some times that some people are watching on YouTube and then get the visual. So and if you are listening on, on a podcast channel, you can just search up level five leader if you want to see it, or go to the YouTube recording. And here is the example. So continue on Brad, we'll just leave that model up while you're describing it.
Brad Giles 12:54
Okay, so we've level three is a competent manager, they organize people and resources towards effective and efficient pursuit of predetermine objectives. So that means that someone's telling them, we need to produce 100 widgets, someone's telling them that we need, our team needs to sell $10 million. And they do it and they do it well. And they, they can organize the people in the team to be able to achieve that, then we get to level four, which is where so many people get stuck. Okay, that is an effective leader. And that's really, you know, the basis of today, which is they catalyze commitment to end vigorous pursuit of a clear and compelling vision, they stimulate the group to high performance standards. So effective leaders can build really, really good companies. Okay. But the problem is for effective leaders, it's so much about them. And there isn't an enduring element to it, the when they leave, there's like a large vacuum that is left behind. And then of course, we've got the level five executive, they build enduring greatness through a paradoxical combination of personal humility plus, professional will.
Kevin Lawrence 14:09
So hear us clearly the level four executive is a highly valuable team member, they create an incredible impact in their organization, they rally a team drive a team great, they can get great results. So we're not saying it's not good. It's just not the most effective version, or the or the best version of a leader in organization that level five is so they do make great things happen. They can be excellent people, all kinds of stuff. But in many ways, it's almost like the distinction between being, you know, a VP in a company and truly being an executive. ie, right, if you looked at that, to get to an executive level or a CEO low, it's a different skill set and a different perspective. So and they all are great contributors they're still there. Basically, a low level four leader is still a critical cog in the wheel, a cog in the machine. Things still revolve around it. And it's an important cog. It's a well built cog. It's a strong cog, it's a smart cog. But without that critical cog, things don't work.
Brad Giles 15:21
And it's important to note that the whole mark, of a level four leader is the genius of 1000 help with 1000. helpers. Okay, so, so that's a great signature that when you and I, Kevin, look at leadership teams, and we can see, we've got a genius with 1000 helpers, it's a hallmark of level four. And the work that we're doing, and that we're thinking about is, how can we get this person to transition? to level five? How can we get this person to move to the next level?
Kevin Lawrence 16:00
Correct? And it's like, I know, when I'm talking to a level five leader different than I'm talking to a low or even how they talk about their people. Yeah, like level five leaders are bragging about people and how they're insanely good, and make stuff happen and how they don't really have to be very involved in how they're almost humbled that this person works with them. It's amazing. We're level four leader talks about people more tactically, like they talk about, like, they're really good. And they're good at this, and I help them with this. And I have to guide them with this, you know, and I have to run the meetings. And as long as I take it, so there's a, there's a, there's a higher degree of involvement. And they talk about the people, almost like they're smaller, where the level five leader talks about people like they're bigger. And, in many ways, yeah, there's a shift that we'll talk about later. But this is the way they see things, and we want to kind of touch on it, you know, is it's an opportunity for these people to grow. And what generally happens and why people get stuck at level four is is is that they get caught and don't have the ability to think about the business kind of beyond where they're at. And beyond themselves, they see that they're critical cog in the system. And they're focused on being a better cog, which is a noble intent, they want to be a better cog, versus seeing that they actually should not be a cog at all, their goal should be almost to remove themselves from the system, which is counterintuitive, unless you've had an amazing level five leader that you reported to, you might not even think this, you know, I wrote in your oxygen mask, first, I have a chapter called make yourself useless. it's counterintuitive. The best leaders don't do a lot. They don't do much at all. they facilitate enable support and resources. But the systems aren't dependent on them. And it's just it's not in people's nature to engineer themselves out of the system. They're more likely to and that's you know, and they're not bad people. Because you know, as a level four leader, you're making a lot of decisions, you're in the middle of the action. Yeah. But you have to make the decisions. And if you don't, the people around you either aren't used to it, or are uncomfortable with it. And by the way, I know what you my ego kind of likes making decisions makes me feel good. Makes me feel important. Makes me feel like my experiences valued all kinds of emotional stuff from being the cog in the middle. And, and it provides you meaning and it gives you some sort of purpose. And it holds you and your team back.
Brad Giles 18:44
Yeah. All right. So let's dig in. We've got a few talking points here today. Let's dig into the so I think we've kind of clarified what is level four, it's certainly something that's very, very common that we come across. And we know that the difference between a level four and a level five leader is predominantly around humility, it's around wanting their team members to endure past themselves. So they can that they are humble and they want the business to endure past their own time in the organization to build an enduring, great company. So what have we got here, Kevin? First of all, we've got highly capable individual. Yep.
Kevin Lawrence 19:38
Sometimes you got a highly capable inner individual, who sometimes with massive they have a lot of drive and they are trying to do the right things. They just haven't figured out and maybe we'll start with the inversion, which you know is later on our list will start about it. Basically the mindset, the inversion everything it takes to become a successful level five leader, and let's just say to be a vice president in a company, everything it takes is about your ability to deliver and have a team around you supporting you. But it's like you were accomplishing and these people support you. And it needs to invert. So that your team is the one accomplishing, and you're the one supporting them. So all of the winds and the pressure sit on your direct reports, shoulders, versus all the pressures sitting on your So basically, it's a flipping of the accountability and the flipping of the model. And, and, but again, that's not something that people can see, and are even conscious of that they need to do that, because they're just so used to carrying the accountability and cross, you know, taking the ball across the line, metaphorically,
Brad Giles 20:51
most of the time, the only way that you can get to be a successful leader, his force of will is just Yes, being like a train that is going 100 miles an hour as fast as you can, and pushing projects through, pushing us pushing your will pushing the decisions making things happen is what gets you from sort of, let's say the bottom of the org chart to the top of the org chart. But the problem is, you're not actually at the top of the org chart, you've got one next level to go and what got you to level four won't get you to level five, in fact, it's the opposite. You need to opposite that. Yeah,
Kevin Lawrence 21:32
so I've got an executive, I was doing some work today, he's being developed for a CEO role. And I was doing some work with him on this today. And, you know, when things got messy at the end of last year, it's almost like he took the company, he strapped it on his back. And he's trying to carry it across the finish line to get to their EBITDA target. And he literally is going we had this much gap and I can see him carrying the company on his back. Now. He pissed off some people around him, he drove some people nuts, but his intent was Noble. But that's level four, it if it must be done, you know, I'll find a way and these toys. Whereas, you know, a level five leader wouldn't do that. level five leader would rally the team and have the team figure out what the team's gonna do. And have the team and then their teams figure out the action plans. And the executives and their people would figure out the plans. And together we would versus if it's meant to be it's up to me.
Brad Giles 22:34
And it's so counter intuitive. It's you need to unlearn all of the things that you've learned through your career, which is so tough to do, right? It's so so tough to do. So many times, I start working with a leadership team, and everything rests on the entrepreneurs shoulders, just like he said so many times, and they're like, I don't know how to get the people around me take responsibility. Like I give them KPIs, and they hear me and they look at them. And they sometimes they do a good job, and they're good people, but I can't get them to step up. And that's because everything that has got you to this point in time is there. And then the amazing thing after a year or two people begin to say it feels like a different leadership team. And then the entrepreneurs are saying, Well, you know, everything, all of the decisions had to be made by me. And now what I'm finding is that I'm only coaching I'm as in dire only coaching, all the decisions are being made by other people in a, I guess, in an authentic setting.
Kevin Lawrence 23:45
And that's an indicator is Yeah, what percentage of the decisions are being made by Uverse? Your team? And by the way, it's not true, that all the decisions had to be made by me. The truth is, I made all the decisions. Right? That's it's a different habit. So so the ideal so what percentage, you know, and again, and back an oxygen mask, oxygen mask, first oxygen mask, first, the oxygen mask first. You know, the idea is, is one of the principles is stop being chief problem solver, which is something I see, you know, leaders do all the time, and it keeps them at a lower level. And it keeps your team from growing and taking responsibility. And it's, you know, the threshold says your team should solve 90% of their own challenges and answer 90% of their own questions. Now, that's a principle the number might change, but that you really, you should be letting them do most stuff. And that's what the best level five execs do both because they probably know more to make it and their job is to make a decision that they own so that they will make sure to make sure it works.
Brad Giles 24:50
And it's not only entrepreneurs or CEOs that can suffer this fight true. I'm thinking in people particularly about one organization that I've worked with. And there was a senior executive that was accountable for one function in the business. And this person was, by definition level, level four or more importantly, by definition, a genius with 1000 helpers. They didn't what they wanted, they didn't want to employ competent people, this person wanted to employ assistance, low level young people, and that person could tell those people what to do that this person could say, you go and achieve that task and get that done. And then I'll give you the next task.
Kevin Lawrence 25:38
Yeah, great point. So so let's kind of go through a couple of the main high points here. So one is, you know, say or off one indicator where people get stuck, they say or operate, like, if it's meant to be, it's up to me, right? Like it's on their shoulders, they're the one accountable. Second, and we see this in companies. And it's pretty obvious, but there's a massive, a big capability gap between that person and their leaders or managers underneath them. And I think, you know, it's a great point you call though this is not just about CEO at any level in your organization, you could be a level five leader, but they, but the competence, the capability gap, and whether it's, they haven't thought about building stronger people, or they have strong people, but because they're making decisions for them and not challenging them enough. It keeps them small.
Brad Giles 26:27
And that's such a great point, what's if you look at any business that you can think of, or any team, with a leader, what's the difference in capability and competence between the leader and the person who reports to the leader? Because if it's two or three levels, okay, that's a really important sign that you've got a genius with 1000 helpers problem, yes, if they're about on the same level, and they can argue and debate at an equal level of competence, then that that may be maybe a sign that they're not suffering from this problem, but it's kind of everywhere to a degree as well,
Kevin Lawrence 27:05
it is, and it's hard for some people to have really incredibly good people on our teams, right, it takes a lot of humility and confidence to have outstanding people around you because they should be smarter than you in their particular area, they should. And if you're doing the right thing for an organization, they should be able to take your job. And but that's not something that everyone is up to. So that's, that's another one the capability gap, massive assign, and tied with that how they speak about those people, even the way they look at them is a sign that's similar. You already touched on this. But you know, you know, if you left the business, there'd be a really big hole. And and and that your division or your team could fall on their face, ie your leadership is critical for their success. ie, you know, without you things don't work. And that's, that's an indicator that you're closer to that genius with 1000.
Brad Giles 28:05
What went on looking to engage with a leader, one of the things that I'm asking myself is, it has this person got the capability to get to level five. Okay, so I want to work with companies that become enduring great businesses. That's, that's kind of the preface that I use. So the person who's running the business or owns a business has to have that capability that I can tap into and get them there. Like, that's, it's kind of like, one of my, my rules. So I go back to the previous point that you made. I remember, I met with a unnamed leader. And, and we met a few times, and this person was telling me time and time again, how all of the people he was surrounded by were absolutely incompetent, how they, you know, he, he went to great extremes to say how bad they were. And yeah, it's just, it was just one of the many signs that made me think this person isn't doing it because he's necessarily surrounded by incompetent people. Okay, he thinks that he's the smartest person in the room, which is a problem. There's no humility there. by us. I couldn't, there was nothing that I could tap that could transitioning out of level five, sorry, out of level four into level five. And, that really goes back to what you said. That, you know, if, if that person left the business, would there be a dangerous hole? In that role? Yeah, because he was keeping them down. He just thought that they were no good.
Kevin Lawrence 29:48
Yeah, and if you find yourself thinking you're the smartest person in the room. That's a dangerous thought. Right. And you technically may have the highest EQ or most experience in the room. You might, but or you might not, oh, and it might not matter. But if you're thinking that you're way smarter, your brain starts to close. And you're not able to leverage the brains of those people around you, or in many ways, respect the brains of those people around you. And that's a real dangerous, slippery slope. And even, you know, the most effective level five leaders have had the honor of working with, they're going to listen to perspectives from anyone.
Brad Giles 30:26
Yeah, right.
Kevin Lawrence 30:27
Now, they might not agree with them, but they are going to truly listen and take them in. And if it fits, they take it on board. If not, they they they don't. Yeah, that's, and that would tie into the next one, Brad, is that you know, that, you know, you as a leader, or someone on your team, if you're thinking of this, finds it hard to get or keep good people. Right, like level five leaders, people want to work for them. They want they attract talent. And people don't want to leave, because it's an environment where people thrive. And so if you're finding it hard to get them, you might have a bad reputation. Or keep them maybe people don't love working with you. And it's not that level five leaders don't challenge people as much they do. But the genius with 1000 helpers, there's almost a built in undervaluing or disrespect of the person, because you're treating them like they're not that intelligent, or capable.
Brad Giles 31:25
You don't understand Kevin, it's really hard to get people who were who would great in the way you're describing to work in our area, or industry, or in our geography or whatever it is, you don't understand, right? This is what we hear all the time, you don't understand. And when someone says to you, you don't understand, it's really hard to get people to work effectively in this industry, you know? Is it the industry? Or is it the geography? Or is it you because to pick up on that point, and your previous point, like the job of a level five leader is to tap the native genius inside the people who report to them to, to actually to find that, that spark of genius, and to amplify and amplify and amplify it, because that's where the respect comes from. And you can only do that if you're coming from a base of humility,
Kevin Lawrence 32:28
yes, and a base of believing in other people and their ability to grow and improve. And the idea that you are indeed very replaceable in your organization. Right, but that comes from humility. And that humility is knowing that you have great strengths. It's not you know, about being a wet man, what you know, noodle is you have great strengths. And there are other great people that, that you can work well with and learn from and teach to them as well. And that someone else could do your job better than you. You know, and maybe that might take some time or learning or development, the humility is, is critical. And the thing about the humility is, is you don't need it to be about you. You don't need the limelight, you don't need to be the one seen as making the decision that you're happy. And I see this in meetings when I work with level fives is that when there's something to be done, they'll step back and say, Hey, team members, you know, please want you guys present it or team, what is your recommendation? And they will step back and step out of the way and let those people do great work versus having to look like they're versus having to look like their work.
Brad Giles 33:36
Yeah, now audio engineer just had a heart attack, because you stopped back to demonstrate it to me, but the audio and when I stepped back
Kevin Lawrence 33:44
to did to get quieter Brad, the farther I stepped back.
Brad Giles 33:46
Yeah, for all Brandon's having heart failure right now. So but I want to pick up on what you said, right? Because what's happening, or you know, another way to put it is, who's the, when you're in a meeting with your team, as a CEO, or as a leader of a team? Who's the last person to speak? Okay, it's a really small and simple thing to do. But if you're the first person to speak, okay, everyone else is going to fall into line with what you're saying. Okay, and that and that. And it's a simple, simple tool, but in every workshop that I do, every single one, I ask the, the one of the least hierarchical persons on the org chart in the room, if that makes any sense at all, to speak first. So the last person
Kevin Lawrence 34:48
people with the lowest power or authority. Correct. Thank you for that. Yes,
Brad Giles 34:52
that's exactly Thank you. The very last person will be the CEO. Okay, be and then if there's another person like the COO there'll be the second last. So I want all authority to speak last. Because that a gets the people without authority to think for themselves. And it forces humility and it forces difference of opinion. And it begins to tap the genius of others. And ultimately, what I'm trying to mechanically do is get a transition that leader to think about always speaking, last, and then that is one of the level five traits,
Kevin Lawrence 35:31
same, Brad, and sometimes, you know, leaders are so again, most of our core contacts through CEOs, but they're so keen to help and be of service and be a value. They jump in and offer their opinions. And many times I'll have to pull them aside and say, Hey, love it for you to be last. And when I go through and do a wrap up, I always similarly go to the CEO last now, there's a few partners in the business, I might mix it up a little bit. But the lead partner or a managing partner or CEO, always, always the last to comment ideally, on everything, because they skew the conversation on how would you remember, I think we chatted about this before, you know, one organization, the CEO started using an iPad in a meeting before another organization, they all had this hits the CEO had the certain type of shoes, lo and behold, people are wearing those guys shoes. The best one is, and this is a company that the people don't travel that much. The CEO has one of those briefcases on wheels or briefcases, on wheels, like lawyers have. Everyone's got a briefcase on wheels, it was hilarious. Because it's, you know, the power and influence that a leader has and at any level, it gets role modeled and followed in on some of the stuff we don't necessarily want following one open thing. So
Brad Giles 36:58
and all of that, that you've just said, small byproduct of the force of will that's got that lead to that position. Yeah, all of those things, okay. But the great leaders, now, the level five leaders step back, and they tap the genius of others, they get the other people to think for themselves, and they find every opportunity to not interfere with their individual thinking, and, and getting those people to be great in their own right.
Kevin Lawrence 37:33
Yep, absolutely. Next thing is, is, you know, that, you know, the thing that shows up for genius with 1000 helpers, it's, it's hard or hard work, to get people to deliver to their expectations. Right, because in many ways, and you know, they're closer in the direction to like a taskmaster and, and getting people to do work on their behalf. And it's just harder to get people to deliver because you're setting people up in a more tactical role. Sometimes they're not as involved in the big picture, or they're not involved in decisions as much, they're more just executing. And it's an indicator of, of ours, one of things that level four leaders are geniuses with 1000 helpers have because they're always trying to get better helpers and get better stuff out of their helpers.
Brad Giles 38:19
And maybe you think it's because they don't have the ambition, or they're not as hungry. Or maybe you think it's because they're not as determined. But the problem is, is that ultimately you are paying their mortgage, you are paying their salary. And if you have such a high force of will, and you are driving everything to get executed all the time. They're gonna sit back and they're gonna say, Okay, what would you like me to do? Hands off here? Tell me what you want me to do. If you want me to do 30? I'll do 30 if you want me to do 77, I'll do 77. That's what I'll do. Because we're there simply complying to what you want them to do, because that's your opera. Oh, yeah, that's your operating mechanism. I'm going to force it through.
Kevin Lawrence 39:10
Tony, which takes us into the next point is that you find yourself to be the driver of and accountable for many projects. You are the Oh, you're the genius with 50 projects, or 20 projects or 10 projects. But where it's You're the one leading the meetings, you're the ones whose names beside the accountability. You're the one driving it, you're the one troubleshooting it. So, you know, that's and man, we appreciate it in the companies were thank you for owning and driving those projects. It's great because it gets us results as a company, but it inhibits your growth. It inhibits your team's growth and you're probably going to burn yourself out if you haven't already because you're carrying too much on your shoulders.
Brad Giles 39:55
So yesterday, I'm working with a leadership team and they're looking at putting in an asset map. Management System, okay, so that every machine or whatever it is has a barcode on it, and it's got its own code, and it's all in software. And the CEO says, I'm the only one that can do it. Okay, hang on. Wait, wait, wait, wait, what do you mean, you're the only one that can? Okay, you've already got seven priorities this quarter of which my best guess is you'll probably do two, maybe three. Okay. And so you're saying that you will only? What about all of these? Are the people that are I in this room and be in the company? Is there any way that you can get other people to do it? Well, they just won't, they just won't do it the same way as me. Okay? What's gonna happen if they don't, they'll stuff it up. Like, you've got to be able to pass things off, you've got to, you've got to, you've got to tap that genius of others.
Kevin Lawrence 40:49
Yeah. And, and the way that you start that is by making people accountable, and it sits on their shoulders, and it's their job to figure out, it's their job to come to you if they need help. And that's how you build leaders. It's also how you free yourself up as a leader and take your helpers and make them their own leaders, because that's really we're talking about is going from a genius of 1000 helpers to germaneness, level five leader and the only way you can do it is to turn your helpers into leaders. Yeah, because when your helpers become leaders, well, then great things happen. And they're thrilled to the whole system benefits. But as long as your helpers are helpers, man, I hope you really take care of your resilience rituals, you're gonna need it.
Brad Giles 41:30
Yeah, yeah. And that's exactly what we did in that meeting yesterday, is I forced the issue as I demonstrate it, and I said, Look, so why don't we give it off to this person, or that person or that person, we identified a person, I said, Look, let's make them accountable, we'll just set a meeting in about two and a half months time between the two of you put it in your calendar now that that person will come back with this result. And you don't have to touch it. In the meantime, you can check in if you like it a weekly meeting, but you don't have to touch it. But let's just get someone else to do that.
Kevin Lawrence 42:09
Yep, perfect. Perfect. So now, and this is tied into the comment that we made about, you know, your helpers becoming leaders is, is not having too many, too many level two or three leaders, you got to have enough level fours, if you want to be a level five, right, that's just a measure of the type of leader pretty is pretty, pretty straightforward. So the root of all of this is that level four leaders.
Brad Giles 42:36
Just to clarify that point. Sorry. Are you surrounded by level twos? Who were contributing team members? Are you surrounded by level threes? Who are competent managers? Or are you surrounded by level fours, which are effective leaders is the point that we want to make? They're correct. Because we want you to be surrounded by level fours, not level threes, or level twos.
Kevin Lawrence 43:01
Yeah, in many ways, it's almost like a math equation. If you want to be a level five yourself, you need some level fours around you, if you've got a whole bunch of level ones, and you're trying to be a level five, the system won't work, especially at scale, the system won't work, you're gonna get sucked down to driving projects and leading projects level one is a highly capable individual. Right? Yeah. And that's, you know, you're not able to be at your best. So, all we're really getting here, this genius with 1000 helpers is a normal place for people to get to in their world, whether it's a as you know, no matter where it is an organization, it's a normal place to be where you're a critical cog and leader on the team. And you helped orchestrate a lot of stuff and make a lot of stuff happen, but you're in the middle of it. Versus stepping aside, I'll stay close to my microphone, this time, staying, stepping aside and getting the people to be the ones that are fully having ownership of the systems and the programs and the goals. And you're there was a support piece, right? And it's like you might lubricate the gears a little bit, but you're not running the gears you're not in the middle of the system. And that creates trust and growth and accountability for people. And for you. The whole idea is when you can shift to a level five, you can handle more responsibility without as much burden. you're developing amazing people. And then you can focus outside of operational stuff and get more strategic where there can be much greater value add because you're not caught in the daily firefighting near as much.
Brad Giles 44:35
Yeah. So it's, it's understanding that what got you here to level four won't get you there. If you have said, Gee, this is terrible. I've got it. I am a genius with 1000 helpers out. And the worst part is I created this myself. It's okay. It's normal. But now you've got to understand you've got to unlearn the force of will that got you here? Embrace humility and begin to identify and tap the genius of those around you and get them accountable for things so that you can escalate and get them accountable for those things themselves rather than you.
Kevin Lawrence 45:16
And one quick shift, and you know, I think I can move between level four and level five, I'm, you know, there's some things where I can get sucked down to level four. And as our firm is growing, you know, a great catalyst is brought someone on the team who is definitely a level five leader, and outs and, and a player outstanding at what he does. And I think some of the other team members would also be like that, but this one in particular, he's outstanding. And I also know that if I am going to work well with him, I have to be a level five, I cannot be a level four and manage a level five. So my level five tendencies come out much more so. And it's easier and I see different things. And again, yeah, I have awesome, awesome team, but my behavior has to change, the stronger my team gets, the more my behavior has to change. And the more it needs to be in that level five zone most of the time, not striving for perfection, that's my own experience. So if you really want to make a move, hire someone or get someone or a team who is a player level five leader, and use that as a great catalyst for your own growth if needed.
Brad Giles 46:28
Yeah, so because let's remember this concept come from originally Good to Great, and analysis of, you know, very, very successful companies. And the great leaders will level five, the good companies, it had level four leaders, so they were still incredibly successful. But the difference was, they weren't in during when the leader left, there was a vacuum. And that success kind of imploded in on itself. Because it was all about the leader.
Kevin Lawrence 47:02
Now, let's be honest, would you want to work for a level four leader if you had a choice? Or would you want to work for level five?
Brad Giles 47:10
Well, everyone knows the answer to that everyone wants to work for level five, everyone because you're more valued.
Kevin Lawrence 47:17
Yes. And if we pick up where we started, and we talked about surrender, level five does surrender a lot more. They have incredible will and humility, but they leave things to other people, which makes them feel good and accountable and valued. So surrender, and they have less of the FOMO because they don't need to be in the action. Do you like how he tied those two together? they surrender more using Brad's keyword. And they're more relaxed around FOMO. They don't feel like they're missing out by not being in the middle of the action. They're more comfortable being a leader on the side, or away.
Brad Giles 47:55
I wouldn't say it's as good as Canadian, some of the Canadian cheese that we've experienced in the past, but it's pretty good. All right. So with that, let's move to close. Thank you. I hope you enjoyed this discussion about the genius and 1000 helpers, a problem that we come across all the time. This has been the growth whispers podcast, my name is Brad Giles. And you can find me if you so desire at evolution partners.com.au and my co-host, Kevin Lawrence at Lawrenceandco.com. So thanks for watching. We hope you can aspire and achieve your level five leadership and we look again to seeing you next week. Well hearing from you next week. Enjoy
Kevin Lawrence 48:39
have an awesome week.
Podcast Episode 48 - Pitfalls of Scaling Your Business
IN THIS EPISODE:
This week Brad and Kevin discuss the top 9 ways that people fail when scaling their business - and what you should do to avoid the pitfalls of scaling your business.
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