Podcast Ep 75 | Genius of the AND

Many times we get stuck in what’s called the ​“Tyran­ny of the OR”. This means that we are stuck think­ing about a solu­tion to a prob­lem in a bina­ry way. For exam­ple, feel­ing your com­pa­ny has to choose between a focus on prof­it or pur­pose is an exam­ple of ​“Tyran­ny of the OR”. Instead, we might think we can pur­sue a prof­it AND a purpose.

Anoth­er exam­ple might be some­one say­ing we can’t grow both cus­tomers and mar­gins. Under the right cir­cum­stances it’s the genius of the AND that can make a remark­able dif­fer­ence in your team.

This week we’ll dis­cuss the Genius of the AND con­cept, pro­vide sev­er­al exam­ples, and explain how you can use this idea with your team.

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, wel­come to the growth whis­pers where every­thing we talk about is build­ing endur­ing great com­pa­nies. My name is Brad Giles, and as always joined today by my co host, Kevin Lawrence, Kevin. Hel­lo, and how are you doing today?

Kevin Lawrence 00:26

We’re doing great, Brad, it’s get­ting a lit­tle dark here, the nights com­ing to an end, the sum­mer is start­ing to cre­ate short­er days as we move towards fall. But all is always good in this part of the world.

Brad Giles 00:39

The good thing is, as you go into short­er days, our days get a lit­tle bit longer and warmer known. So we’re quite pleased about that. As always, we’d like to kick it off with a word or phrase, would you like me to go first? That looks like a yes. I’m going to start with Are you proud of your fir­m’s prof­it? Now, that could be you as the founder. It could be you as a con­sul­tant, it could be you as an employ­ee. Are you proud of it? Yeah, why was I Why? Because the prof­it is the net result. That’s pret­ty much it. Every­thing that we talk about, it should ulti­mate­ly result in that. What’s yours, Kim? Mine is,

Kevin Lawrence 01:23

if I had a bil­lion dol­lars, we have a band a Cana­di­an band called The Bare­naked Ladies, and they have a famous song know­ing if I had a mil­lion dol­lars, you know, and that’s, you know, I buy me a coach, I, you know, have some Kraft Din­ner, you know, they have all kinds of crazy things. But, um, it was inter­est­ing. And again, I men­tioned in last episode, Greg Smith, the CEO of Thinkif­ic men­tioned a strate­gic ques­tion they use, which is, if I had a bil­lion dol­lars, or if we had a bil­lion dol­lars in the bank, what we do just to expand their think­ing. And what they found, is it gen­er­at­ed some spec­tac­u­lar ideas, none of which cost a bil­lion dol­lars, most of them they could do now. So it’s a mind open­ing, like think real big, and what’s pos­si­ble. And, and often it is so yeah, so are you proud of your bil­lion dol­lars think­ing is kind of what we’re, we’re set­ting the tone with here today, Brad, I like it.

Brad Giles 02:23

That’s a good way to start. That’s a good way to start today. What are we talk­ing about?

Kevin Lawrence 02:29

we’re talk­ing about some­thing from the great thought leader, Jim Collins, and one of his prin­ci­ples, which he calls the genius of the end. And you know, and inter­est­ing­ly, you know, I have a good friend, and, you know, her whole phi­los­o­phy and her work is around the end, right, not hav­ing to choose where you go, and where you can basi­cal­ly, you can feel proud and dis­ap­point­ed at the same time, or you can feel proud and almost self crit­i­cal. At the same time, how you kind of fight­ing emo­tions hap­pen­ing, it’s real­ly inter­est­ing con­cept. In for our firm, we talk about the end, which we’ve used for years, which is about being hav­ing suc­cess at work and liv­ing an amaz­ing life. Right, not hav­ing to give up one for the oth­er. And then the oth­er end, Collins’s work, he found that a lot of peo­ple got stuck with the tyran­ny of the end, try­ing to do two things. And then it was a fight and basi­cal­ly almost mak­ing it an order or need­ing to choose a tyran­ny of the or par­don, yes,

Brad Giles 03:37

tyran­ny of the old

Kevin Lawrence 03:38

and hav­ing to choose between two options. And you know, when real­ly the genius of the end is that how do you have both? And it takes more think­ing some­times or more strat­e­gy, but that’s real­ly where dig into is the genius of the end? And are there ways that you can take think­ing where you were try­ing to decide verse and actu­al­ly try and say, well, we’re going to do both things? And how do we get a bet­ter impact or a bet­ter result by focus­ing on both

Brad Giles 04:08

and the tyran­ny of the or is real­ly the foun­da­tion of this episode and, and the prob­lem that peo­ple can get into when they think about any sit­u­a­tion real­ly, but what hap­pens if you’re think­ing about only being able to react in an or, or the tyran­ny of the or because what that can mean is you can think we must make prof­it, or we must be a pur­pose led orga­ni­za­tion, they don’t think about the pos­si­bil­i­ty or the genius of we can, we can be a very high­ly prof­itable orga­ni­za­tion and can be a pur­pose led orga­ni­za­tion as a sim­ple exam­ple. And then that, that tyran­ny can per­me­ate so many parts of your deci­sion making.

Kevin Lawrence 04:57

It’s very lim­it­ed think­ing So many ways that scarci­ty based or scarce think­ing, and some would say that being pur­pose led should make you more prof­itable. You know, I see I see, um, inex­pe­ri­enced lead­ers and com­pa­nies say­ing, Well, if we got to grow the vol­ume, you know, we got to decrease the mar­gin. Like why no, you can grow sales vol­ume and increase gross mar­gin as a per­cent­age while you grow, you just got to be smarter about it, you know, and if you’re not, a lot of peo­ple will grow sales vol­ume and drop mar­gin, because then they’re just pick­ing up the low hang­ing com­mod­i­ty type busi­ness. But his point is, you can and there’s lots of exam­ples. And you know, as we’re think­ing about this, for the show, prof­it and pur­pose is a great thing. But also, you can have a very car­ing cul­ture, and a high per­form­ing orga­ni­za­tion. You know, some peo­ple see very car­ing and sup­port­ive cul­tures, clos­er to a gov­ern­ment agency that’s full of love and won­der­ful things that, you know, does­n’t make a prof­it or isn’t high per­form­ing. But I’ve seen very car­ing orga­ni­za­tions, but they are intense. And they work like crazy to get things done and have very, very high expec­ta­tions as well.

Brad Giles 06:18

And Jim Collins talks about this con­cept of lev­el five lead­ers as an exam­ple and lev­el five lead­ers, they have the will, the will to build an endur­ing growth com­pa­ny, it’s an incred­i­bly dif­fi­cult, yes, equal­ly. And they have the humil­i­ty to make that com­pa­ny big­ger than them­selves or not only about them­selves, so they think about they want to build, and they have the will to build a com­pa­ny that is larg­er than them­selves, and is not all about them. And so that’s anoth­er exam­ple of the pow­er of and

Kevin Lawrence 06:54

so we have one more of our clients who wants to more heal­ing for five years, once the least five years, wants to build a $10 bil­lion orga­ni­za­tion, that is his goal. And all the won­der­ful things that come with being a bil­lion­aire are part of his goals and his ambi­tions. And he is an absolute, he is the essence of a lev­el five leader with incred­i­ble humil­i­ty. So insane dri­ve and mas­sive goals. with humil­i­ty, that is me. That’s the kind of per­son we want to work with all day long. Yeah, great, great peo­ple are some­times peo­ple would think, well, if you’ve got that much ambi­tion, you’re going to have the ego to go with it. Yeah. Right. And and and that is not the case. So tyran­ny I Oh, it is a Why do you think peo­ple get caught up in the tyran­ny of the order? And how do you shift to the tyran­ny of the end?

Brad Giles 07:52

So I’m going to get back to a quote a famous author called F. Scott Fitzger­ald. Okay, you might have heard of him. His quote was the test of a first rate intel­li­gence is the abil­i­ty to hold two opposed ideas in the mind at the same time, and still retain the abil­i­ty to func­tion. This is exact­ly what vision­ary com­pa­nies are able to do. He did­n’t say last week, but that’s, that’s his quote. And, and so the, what we’re say­ing is that a goal of a lead­er­ship team with­in this con­text should be that we want to be able to be intel­li­gent enough to know that a pri­ma­ry goal is to have the end is to say, it’s easy to a degree to say, we’re going to be a prof­it, first orga­ni­za­tion, every­thing falls into that, but it’s hard­er to hold that thought, and simul­ta­ne­ous­ly, be able to func­tion think­ing and we need to be a pur­pose led organization.

Kevin Lawrence 08:59

Yep. So there’s lots of sit­u­a­tions where you have debates, you know, and peo­ple get caught up into these or ways of think­ing and it is eas­i­er to choose left or right, ver­sus how do we do both. Anoth­er exam­ple I see is, you know, when peo­ple have goals, it’s, you know, we real­ly want to reduce the cost. But we actu­al­ly want to improve qual­i­ty. Right now, some­times you can be over com­mit­ting when you pick these things, but it’s, well, how can we do both, and then you end up with a whole if you take the time to think and brain­storm about the ways to make it hap­pen. Some­times there are solu­tions that decrease cost and increase qual­i­ty even though it seems like the repur­pos­ing, like there can be ways to sim­pli­fy process­es, or use a dif­fer­ent ven­dor or do some­thing dra­mat­i­cal­ly dif­fer­ent it the dif­fer­ences it cre­ates, it takes a high­er lev­el of cog­ni­tion to fig­ure them out. Some­times not always, but to fig­ure them out and when you put your­self into those You know, those more cre­ative box­es? Yeah.

Brad Giles 10:04

Yeah. So anoth­er good exam­ple is around health­care. We know that with for many med­ical prac­ti­tion­ers, they may take the Hip­po­crat­ic oath. And as they should, you know, do no harm. Yes. The but I health prac­ti­tion­er equal­ly must be prof­itable. Oth­er­wise, if they are not prof­itable, then that mon­ey to pay the loss needs to come from some­where. And so, under­stand­ing that the pur­pose of an orga­ni­za­tion is is not to make a prof­it. But beyond that the orga­ni­za­tion can­not exist with­out prof­it. So, we’ve got to be able to hold those things for the patient

Kevin Lawrence 10:54

and the prof­it of the orga­ni­za­tion. And there are ways to do that. Yes, some peo­ple default to just what’s right for the patient. Some peo­ple default to jus­tice, right for the prof­it of the org or the org, and to try and think about are there ways and that’s the ulti­mate Win Win, right? And I remem­ber a nego­ti­at­ing sto­ry about two kids fight­ing over an orange. Yeah. And the mom was smart enough to say to John­ny, John­ny, why do you want the orange? He goes, Well, I need the peel for my sci­ence exper­i­ment. And then Sal­ly was Sal­ly, what do you need for? Well, I’m hun­gry. So she’s like, Okay, great. John­ny takes the peel. Sal­ly takes the inside of the orange, both kids are hap­py, right? That’s an end, right? Is there a way that they can do both. So it’s just, it’s, it’s it just requires more think­ing. And that’s why peo­ple kind of have a hard time with it. So you’ll often in orga­ni­za­tions we work with, we will say we need a high­er qual­i­ty of tal­ent, we by default 90% a play­er’s as a goal, many orga­ni­za­tions we have for their key key key seats or key roles. Yeah. And we want to speed up the hir­ing process. Or it’s 90% eight play­ers and spend less total com­pen­sa­tion as a per­cent of our gross mar­gin. So our peo­ple cost less. And we have more of them being high per­form­ers. And it’s doable. We’ve done it lots of times, you know, anoth­er one is to relent­less­ly exe­cute our sys­tems, and inno­vate. So for exam­ple, one com­pa­ny that we work with, they have a sep­a­rate and like many do sep­a­rate inno­va­tion team with an inno­va­tion bud­get. And they’re always test­ing new things. So what they’ve done is, some of the inno­va­tion is pulled off and sep­a­rat­ed. Some­times it gets to be too much. The core peo­ple that are dri­ving every day of exe­cu­tion, stay focused on that. And then a few peo­ple focus on the inno­va­tion and how it can improve. And then you bring those in and incor­po­rate them. So it’s both some­times you just have to carve up respon­si­bil­i­ties to allow some of these things to hap­pen. But the orga­ni­za­tion can relent­less­ly exe­cute the as is, while some oth­er new orga­ni­za­tion are inno­vat­ing at the same time.

Brad Giles 13:08

That’s a great exam­ple of what Jim Collins describes in if you can imag­ine the yin yang sym­bol, where on one side, he says stim­u­late progress. And then on the oth­er, pro­tect the core, so on pro­tect the core that’s about core val­ues and pur­pose. And the ide­olo­gies of the firm that should be endur­ing. They should be here for gen­er­a­tions, with an Aster­ix, but then on the oth­er side, we’ve got to have an engine that stim­u­lates progress. And it is pos­si­ble to do those both of those things, you do not need to rein­vent the firm all the time when it comes to the ideologies.

Kevin Lawrence 13:50

Yep, absolute­ly. A great exam­ple that Jim has a shirt. Anoth­er one is, we’ve seen where we would reduce the size of teams, and expect more out­put of those teams. Yeah. Because what’s inter­est­ing, even in our world, when you cre­ate a team of 25 peo­ple try­ing to work on some­thing, it actu­al­ly gets bogged down and slow down. And there’s a raid size. You know, they often say over teams as to piz­za teams, you know, what­ev­er two piz­zas can feed is prob­a­bly the right size team mem­ber, which is, you know, five, six peo­ple. Yeah. And depend­ing on their appetite, but it’s just that you can often speed things up and be more pro­duc­tive by hav­ing few­er peo­ple involved. That’s a real sim­ple one. One of my favorites, and I wrote a blog on this years ago was called joy and pain. That’s like how the best lead­ers know how to cel­e­brate and instill and cre­ate joy with it with their teams, and cre­ate a lot of pain or a lot of ten­sion when things aren’t right. It’s in both. It’s like the par­ent that can be lov­ing and sup­port­ive. And the par­ent that can real­ly give you crap when you screw up. Yeah, and great, great lead­ers are able to do both the great lead­ers aren’t just nice guys are nice women, right? They have both sides of the coin, and they know how to use both. So it’s an and they can be tough. And they can be car­ing and sup­port­ive. And I’ve looked at some of the best CEOs and execs I’ve worked with, they have that that have hard­est, and that and their heart.

Brad Giles 15:23

That’s the premise of great lead­er­ship, it’s lots of love, and lots of dis­ci­pline, if you only had lots of lots of dis­ci­pline, you’ve got a tyrant. And if you’ve only got lots of love, you’ve got some­one who’s a walkover. So it’s the mar­riage of those two, with­in one leader that makes for greatness.

Kevin Lawrence 15:44

Yeah, and we could go on for­ev­er and ever and ever, but it’s, you know, increase prof­itabil­i­ty, and increase cus­tomer sat­is­fac­tion, right? Increase out­put, and increase employ­ee engage­ment. Right, increase employ­ee engage­ment, and increase the per­cent­age of a play­er’s, yeah, right, or, you know, you can pick any two vari­ables, but the main thing is, is that you often end up with bet­ter ideas, because you’re putting more chal­lenge into the sys­tem, you have to be more cre­ative when you bring those two vari­ables togeth­er. So that the rec­om­men­da­tion we’d make is that look, when you’re, when you’re work­ing on some­thing real­ly impor­tant in your busi­ness, you know, and if you’re real­ly see that it should become an and, you know, the real chal­lenge to bring those two vari­ables togeth­er, because they’re both real­ly crit­i­cal, do a sep­a­rate brain­storm­ing on how we could do both, right and break the break up into three teams of, you know, five or six peo­ple get a list of a whole bunch of things that we could do ways that we could do both? print, bring those ideas togeth­er, have peo­ple present them, dis­cuss them, pri­or­i­tize them, get peo­ple to go back again, and say, Okay, let’s take the top four, were top three, because you have three groups, and brain­storm even fur­ther on those on how we could do that how I mean, real­ly open­ing up peo­ple’s brains to pos­si­bil­i­ties, and then you can start to see ways that these things can hap­pen. Ver­sus that you know, the first look, you might just walk by and say, yeah, that’s gonna be too hard.

Brad Giles 17:20

That’s the point, right? Because if you were to say, here’s what we want to do, we want to grow our cus­tomer num­bers by 10% per year, and we want to grow our cus­tomer prof­itabil­i­ty by 10% per year, it might the tyran­ny of the or might instant­ly kick in with the peo­ple that you’re talk­ing about it to wor­ry about. And they may say, Look, that’s too hard. We Why don’t we just focus on one? And then we can do that? Well, we can do both? Well, that is the point. It’s the genius of the end, what if we could do both, what will be the top three things that we need­ed to do to be able to do both because the com­pound­ing effect of that is remarkable.

Kevin Lawrence 18:02

Now, let’s be care­ful, I’ve got a client I nick­named com­ma, because we say we’re going to have three to five objec­tives for a quar­ter. And he will put three to five in each of the three to five objec­tives. And we’ll put com­mas between them. So I got an A teacher with a big calm on it and gave him a hard time about it. This is the CEO. So now he does­n’t use com­mas any­more, he stacks them, he calls it a stack, because it sounds like a more sophis­ti­cat­ed thing. The point is, you got to be care­ful not to use this to jus­ti­fy doing too many things. Now, we’re get­ting down to some­thing that has mas­sive val­ue strate­gi­cal­ly or tac­ti­cal­ly, that it’s one thing that you’re try­ing to say, we kind of got to work both sides of the coin at the same time, ver­sus using this tech­nique as an excuse to clump togeth­er a whole bunch of ideas that are of low val­ue or low impact to orga­ni­za­tion that just should­n’t just be deferred, or left alone.

Brad Giles 19:03

Yeah, but yes, you’re right, full stop. What we’re say­ing is, there is a genius with­in the end. So try to look at it from both angles, and try to appre­ci­ate if you only say or, and you don’t say and in some cir­cum­stances, you could be miss­ing out on quite a lot. Like it’s a kind of a closed mind­set, perhaps

Kevin Lawrence 19:28

it absolute­ly is and just don’t use 10 ends all at once. We’re talk­ing about one and between two vari­ables. Miss Kirk, you know who you are. We’re not using this as an excuse to have 10 vari­ables in one objec­tive. Okay, awe­some. So let’s kind of sum­ma­rize that. So real­ly, we’re talk­ing about the genius of the end which is inspired by Jim Collins. His work he does some great restau­rants and the tyran­ny of the or peo­ple get stuck and hav­ing to choose between two By the way, my favorite tech­nique for the genius and we did it at the break­fast this morn­ing went for brunch this morn­ing. And there’s three amaz­ing types of eggs bene­dict. So I got one, my part­ner got anoth­er and we shared shar­ing meals is a beau­ti­ful way. It’s a beau­ti­ful genius of the end, you don’t have to choose, you get to share. There’s noth­ing so Brian,

Brad Giles 20:22

that’s great. Why did we say that one in the begin­ning of the app? I know we should.

Kevin Lawrence 20:27

So it’s the solu­tion to a Eggs Bene­dict, when you can’t decide or what­ev­er it is shar­ing the genius of the end ver­sus tyran­ny of the or as per Collins and they only talked about exact­ly the exam­ples of prof­its and pur­pose and car­ing and high per­for­mance, increase sales and increase mar­gin, you know, get high­er por­tion, every team that’s high per­form­ers, and you hire them faster or high­er per­cent­age of your team is high per­form­ers and over­all less total com­pen­sa­tion dol­lars as relat­ed to mar­gin. rest­less­ly, relent­less­ly exe­cute and inno­vate, reduce your team size and increase out­put, few­er cus­tomers and more sales, right? Real­ly, real­ly cel­e­brate like crazy and cre­ate lots of ten­sion when things don’t go right.

Brad Giles 21:18

And falling. Yeah, and we can you know, we can be and this was the first one you said. But we can be a pur­pose led orga­ni­za­tion or pur­pose focused orga­ni­za­tion. And we can be high­ly prof­itable. It just takes a deep­er lev­el of think­ing like we don’t need to be only one of those two. What a good episode what episode so let’s move to close. This has been the growth whis­pers. My name is Brad Giles. And you can find me at evo­lu­tion part​ners​.com​.au. And of course, Kevin, you can find at Lawrence and co​.com. Of course there’s an end in there, the amper­sand. And so also you can find us on YouTube. We’ve got some videos up there you may be inter­est­ed in. So thank you for enjoy­ing our episode. I hope today on the growth whis­pers and we look for­ward to chat­ting to you again next week. Enjoy your week.