Podcast Ep 82 | Profit = Intelligence x Discipline

This week on The Growth Whis­per­ers pod­cast, Brad Giles and Kevin Lawrence talk about the two crit­i­cal vari­ables that impact your prof­it. Intel­li­gen­The show helps lis­ten­ers to zoom out and per­haps under­stand why they might not be mak­ing the prof­it that they want. Dis­cov­er ways to look at your dis­ci­pline, your intel­li­gence and your prof­it through a dif­fer­ent per­spec­tive that could have a large impact on your prof­it, and the enjoy­ment you get from your business.ce and Discipline.

If you have the intel­li­gence to cre­ate a prof­itable strat­e­gy but don’t have the busi­ness dis­ci­pline, it will neg­a­tive­ly impact your prof­it. If you have the dis­ci­pline to run an effec­tive and effi­cient busi­ness but don’t have the intel­li­gence to build a strat­e­gy that grows your mar­gin, it will neg­a­tive­ly impact your profit.

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 every­thing that we talk about is build­ing endur­ing great com­pa­nies, com­pa­nies that will last, com­pa­nies that will con­tin­u­al­ly pro­duce and build momen­tum, and real­ly give you the life that you’ve kind of enjoy, love and can be proud of. I’m Brad Giles. And as always, I’m joined today by with my co host, Kevin Lawrence. Good day, Kevin, how you doing today?

Kevin Lawrence 00:40

I’m doing great, Brad. I like that intro that was good.

Brad Giles 00:44

Well, you think after 82 episodes, we’d be get­ting a lit­tle bit bet­ter at this. And so hope­ful­ly, it’s a lit­tle bit bet­ter than the first one. So every­thing good in your world.

Kevin Lawrence 00:56

Things are great. I’m excit­ed. I’m real­ly you know, this. This is a real­ly inter­est­ing show, because we talked about it over a few weeks doing this show. And it’s a real sim­ple piece that we’re talk­ing about. But it real­ly made me think I’m real­ly look­ing for­ward to shar­ing it today. Yeah, good. Yeah.

Brad Giles 01:12

Yeah. It’s been sit­ting around that we’ve been toy­ing with I agree. And it’s good. So we always like to begin with a word or phrase of the day. So Kev, what have you got today? For us any thing from the vault? It

Kevin Lawrence 01:27

is, it’s just the word. One of my favorite words is sim­ple. And I shared in last week’s show, we had our team retreat up in Whistler, and we had 10 of us for two and a half, three days. And as we’re going through every­thing, and we had some new mem­bers of our team, one of the things that kept rein­forc­ing is sim­ple, sim­ple, sim­ple, sim­ple, sim­ple, not inter­est­ed in com­plex things, because they don’t scale very well. And just my love of sim­plic­i­ty. And when I real­ized that I remem­ber hear­ing about, I think, Well, there’s two, there’s two, just two quotes. One is its attribute it to Mark Twain. I don’t know if it actu­al­ly is because when I had some­one on my team do the research, it did­n’t come up as being legit. Although it’s he’s quot­ed as say­ing it many, many times. It’s, I would have writ­ten you a short­er let­ter. But I did­n’t have the time. Yeah. Just it’s hard to be suc­cinct. It’s hard to be right to the point. And the same thing is, is when you watch a mas­ter at any­thing, you watch a mas­ter painter looks like it looks like it’s like the eas­i­est thing in the world. And it takes a cou­ple min­utes for a mas­ter­piece. And in the work that was so sim­ple, sim­ple and sim­plic­i­ty I just how it works. Time and time again. And com­plex­i­ty is nor­mal­ly cre­at­ed by peo­ple who are not yet masters.

Brad Giles 02:51

Awe­some. Awe­some. Yeah. So mine is courage. You and I’ve spo­ken many times about deci­sion needs to be either Hell yeah. Or hell no. And try­ing to push the think­ing around deci­sions to it’s how do we get it to be a hell year? If it’s not, then it’s a hell no. But there’s still an ele­ment of courage, espe­cial­ly with big deci­sions. It’s just not that easy. And so you and I were talk­ing before the show about, you know, some sort of aspects and some deci­sions that I’m mak­ing. And so it’s about courage. It’s like, yeah, some­times even if it is a hell yeah. You’ve still got to have the courage to do it. Yes, you say sim­ple courage.

Kevin Lawrence 03:36

It is sim­ple courage or courage is sim­ple. Courage is sim­ple. All you have to do is spend some time and take a step. That’s awe­some. Cool. Well, let’s let’s dig into today. So today is a lit­tle bit of a math for­mu­la. They’re not alge­bra, we’re not get­ting that com­pli­cat­ed, but math. And it real­ly prof­it equals intel­li­gence mul­ti­plied by dis­ci­pline. Yeah. Now on their own, if you have intel­li­gence, and no dis­ci­pline, you know, intel­li­gence times zero, you get noth­ing your intel­li­gence is use­less. And, you know, the oth­ers and we have a say­ing, you know, we use a lot is, you know, ideas are a dime a dozen. Yeah, you know, good ideas and good thoughts are nice, but they’re not worth any­thing unless they’re imple­ment­ed. Now, the oth­er side of the equa­tion. So intel­li­gence and no dis­ci­pline equals zero prof­it, and no intel­li­gence but a lot of dis­ci­pline can also lead to zero prof­it. We call that bark­ing up the wrong tree. You know, and it’s, there’s a metaphor there’s a sto­ry comes from a dog chas­ing some­thing I don’t actu­al­ly know what it’s from but, but the point of it is that you can work so hard at some­thing, but if it’s not a great idea, or great point­ed in the right direc­tion, or the cus­tomers don’t think it’s a great idea, or you did­n’t promise Right, or who knows what, you can bust your butt for a big goose egg. So intel­li­gence requires both dis­ci­pline. And sor­ry, prof­it requires both intel­li­gence and dis­ci­pline. So a great

Brad Giles 05:15

way to think about this is begin­ning with a zero, but also a de rat­ing fac­tor. So imag­ine if your dis­ci­pline is 50%, what it could be you around the busi­ness in terms of stick­ing to all the ele­ments. I mean, this is real­ly what you and I do we bring in to orga­ni­za­tions, we bring in intel­li­gence, and we bring in dis­ci­pline. So let’s look at dis­ci­pline. And if you were only oper­at­ing at 50%, of the dis­ci­pline, that you could be, you know, then your intel­li­gence, let’s say was 100%, you’re still not going to make the prof­it at the begin­ning of the equa­tion that you should. But if your intel­li­gence or your busi­ness mod­el, or the way that you’re work­ing is only 50%. Like, you’re only real­ly mak­ing a very small amount of the prof­it that you should­n’t be.

Kevin Lawrence 06:11

Right. So in sim­ple terms, if you’re in, you know, if your prof­it could be $10 mil­lion. But, you know, based on our ful­ly, you know, the most intel­li­gent approach and the most dis­ci­plined approach, you know, but but in the case, if your intel­li­gence is only run­ning at about 70, and your dis­ci­plines run­ning at about 70, now, you’re still I think 70 is still a B stu­dent, not sure. But you know, but sev­en times sev­en is 49. That means you prob­a­bly be hit­ting what 4.9 mil­lion a prof­it, or a, some­one who maxed out the intel­li­gent dis­ci­pline can make 10. Let’s take from there, you could have an eight intel­li­gence and a to dis­ci­pline, you’re going to do 1.6 mil­lion a prof­it on a $10 mil­lion pos­si­bil­i­ty, or flip that. So that’s very intel­li­gent, but hor­ri­ble dis­ci­pline. Or you can even take a mod­er­ate intel­li­gence of five, and a dis­ci­pline of 10. And you would get 5 mil­lion. Yeah, so you know, some­one who’s only a five, or intel­li­gence busi­ness being five out of 10. But incred­i­ble dis­ci­pline mak­ing 5 mil­lion bucks ver­sus you can have eight or 10 intel­li­gent peo­ple that would make dra­mat­i­cal­ly less mon­ey because they don’t have the dis­ci­pline. So it’s not meant to be math class, ladies and gen­tle­men, and friends. You know, it’s, it’s, it’s just about real­ly under­stand­ing that these two vari­ables are real­ly crit­i­cal. And we’re gonna dig into both of them a lit­tle bit more lib­er­al way, in these mod­ern times, is say­ing, ladies and gen­tle­men, still the right thing to say I don’t think it is, is waters is say­ing, ladies and gen­tle­men, I think you need I’m just think­ing about being polit­i­cal­ly cor­rect, Brad.

Brad Giles 08:14

I would tell you a quick sto­ry is a team that I work with. And this indi­vid­ual, you know, was prob­a­bly mak­ing about, I’m gonna say about 200 $250,000 in prof­it for quite a while for I’m talk­ing years and years and years and years. 10 plus years, and it was just, it was just not there. Now, this indi­vid­ual did­n’t have the dis­ci­pline. And that was the derail­ing fac­tor. Okay, so, I harassed and harassed and harass this per­son about this dis­ci­pline, and he just could­n’t have it. So we employed a per­son around a par­tic­u­lar role that he was doing to take over that to set some KPIs. As well, as we were already run­ning a lot of the oth­er dis­ci­plines with­in the busi­ness and prof­its. They were four times high­er as a result, and that’s part of where this thing can come from. Their busi­ness mod­el was okay. I mean, real­ly, if they had a much bet­ter intel­li­gence fac­tor, busi­ness mod­el, they could have been in this right, they could have prob­a­bly been doing close to $4 mil­lion. Yeah, with the with a great busi­ness mod­el. But the dis­ci­pline was ramped up, maybe not as high as it could be. But let’s say it was an eight out of 10, or nine out of 10. Sub­se­quent­ly, so with a mediocre intel­li­gence, or an A medi­um intel­li­gence, and in a very good dis­ci­pline that we’re doing real­ly well.

Kevin Lawrence 09:47

Yeah. And I was think­ing about your exam­ple. And it’s a bit of an extreme exam­ple, but one of my clients that when I start­ed with them, they’re mak­ing a cou­ple mil­lion of prof­it and the intel­li­gence was mediocre. Yep. And the dis­ci­pline was mediocre, and we roll for­ward 10 years, we have an incred­i­bly high per­cent­age of a play­ers, their bot­tom line is gone from a cou­ple mil­lion to knock­ing on the door of 100 mil­lion, like get­ting close. Like, it’s incred­i­ble. And if you look at it, the dis­ci­plines that they have in place are incred­i­ble. And they have the right peo­ple in the right seats doing the right things, and the intel­li­gence that they have, and not I, you know, don’t say IQ intel­li­gence, but the intel­li­gence, the under­stand­ing of their busi­ness, in the mar­ket, in their sys­tems in the cus­tomer gets incred­i­ble. And the amount that they’ve been able to, it’s a machine and it’s almost like it’s so good. And they’ve been able to tap into some oppor­tu­ni­ties dur­ing COVID. That gave it a seri­ous bump as well. But it’s so good, it has them going. Like can we sus­tain this? Yeah, because it’s such an incred­i­ble, incred­i­ble machine. But it’s boat­loads of intel­li­gence, and, and boat­loads of dis­ci­pline by amaz­ing peo­ple. So it’s, it’s real­ly pow­er­ful. As we’re talk­ing about these sto­ries, Bri­an, I’m just remind­ed like, that’s why when we go into com­pa­nies and do the work we do, it’s, it’s, it’s kind of like shoot­ing fish in a bar­rel, ie in terms of the results you’re going to get, because It Ain’t Rock­et Sci­ence, what we do, but because we under­stand the sys­tems real­ly well to the point where the sys­tems are sim­ple to us, we go in and put these dis­ci­pline Well, we actu­al­ly we increase dis­ci­pline, and we increase intel­li­gence. Yeah, we increase the strate­gic think­ing, and the insight and over­sight they have of the busi­ness, both at the lead­er­ship lev­el and for oth­er key lead­ers. And then the dis­ci­pline by hav­ing crys­tal clear KPIs and crys­tal clear goals, and, you know, tal­ent reviews, and all of these oth­er things, is that it becomes just part of their ecosys­tem to have more dis­ci­pline and give peo­ple auton­o­my at the same time. So it does­n’t feel like a big bureau­cra­cy. So it’s, it’s amaz­ing, but it’s just enhanc­ing those two very sim­ple but pow­er­ful variables.

Brad Giles 12:32

I was­n’t an intel­lec­tu­al I, you know, I some peo­ple might be lis­ten­ing, think­ing, I bare­ly made it through school, you know, school was only there to fill some of

Kevin Lawrence 12:42

some of our top clients did­n’t did­n’t make it through school. Yeah, well, they still they did, they found cre­ative ways to make it through school, but it was­n’t based on their abil­i­ty to sit in the class­room and write tests.

Brad Giles 12:54

That’s not what we’re talk­ing about when we’re talk­ing about intel­li­gence, not at all. It is the intel­li­gence of your busi­ness mod­el, the intel­li­gence of the way of your strat­e­gy, the intel­li­gence of the way that you present, and under­stand the mar­ket and the way they meet the cus­tomer needs all of the things around that is what we’re talk­ing about.

Kevin Lawrence 13:18

Yes, so let’s dig into intel­li­gence itself, not one vari­able, we know prof­its and out­come. But the first thing is about busi­ness mod­els. And it’s just that not all busi­ness mod­els are cre­at­ed equal­ly, even in the same indus­try. And with the same vari­ables around them. I’ve seen things in the same indus­try, where some­one will be oper­at­ing at 5%. Net income. Yeah, oth­ers will be mak­ing 25 or 35. Now, the ones that are mak­ing the 35, they’re not talk­ing about it. And I’ve seen many busi­ness­es that make you know, I’ve seen some busi­ness that mak­ing 35 5060 and even 80% net income, or net prof­it, what­ev­er you want to call it on notable num­bers. Yeah. Like seri­ous num­bers, like not not not lit­tle star­tups on sub­stan­tial busi­ness­es that again, they’re very qui­et about it. But it’s because of intel­li­gence is that some­one has seen an oppor­tu­ni­ty, on a way to price some­thing in a way that is quite smart, or they know how to buy some­thing or get a resource at an incred­i­ble price. What­ev­er it hap­pens to be, is and not all busi­ness mod­els are focused on prof­it, some are build­ing val­u­a­tion, that’s a dif­fer­ent game. But it’s intel­li­gence in know­ing how to max­i­mize a mod­el or see oppor­tu­ni­ties that oth­ers can’t.

Brad Giles 14:43

Yeah, it’s so inter­est­ing. You men­tioned that I one of the things I do is work with groups. So imag­ine if you will for lead­er­ship teams in a large room, and we’re work­ing through doing strate­gic plan­ning togeth­er myself and these four groups. Now we learn from each oth­er through that mod­el. Now there’s three, let’s say, nor­mal busi­ness­es. And I’ll say nor­mal­ly in the con­text of focus, and then there’s one a tech start­up. And, and so we’re talk­ing about rev­enues, and we’re talk­ing about prof­its as a group. And then I said to them, Look, you do real­ize why they’re focused on their run rate. And that’s the main thing, because all of the oth­er busi­ness­es in the room are going to per­haps attract a two and a half to a five times mul­ti­ple of EBIT­DA of prof­it effec­tive­ly. So if you make $100,000 prof­it, you’re going to be val­ued at 250 to $500,000. Plus, plus, where­as for the tech start­up, they’re going to be val­ued at 10 times their rev­enue, the top line. Yeah. And that was in the end, of course, all the lead­er­ship, the oth­er three lead­er­ship teams, their jaws dropped. And, you know, they were like, I see what you mean, when you say now that all busi­ness mod­els are not cre­at­ed equal?

Kevin Lawrence 16:06

Yep. Because they’re also play­ing a, they’re play­ing the val­u­a­tion and get bought game ver­sus the gen­er­ate cash flow and prof­it for share­hold­ers, right? They’re gen­er­at­ing val­ue for share­hold­ers based on appre­ci­a­tion of the val­ue of a stock ver­sus the cash flow.

Brad Giles 16:22

Well, it’s fun­ny you say that, because that par­tic­u­lar team, lis­ten to the growth whis­pers, and now they’ve switched to build­ing an endur­ing great com­pa­ny. Hey, and so they’re about build­ing an endur­ing busi­ness. Love it? Yeah.

Kevin Lawrence 16:40

All right. So until the first thing, so busi­ness mod­els aren’t crit­i­cal. The sec­ond thing is, is that, you know, with the, you know, the intel­li­gence, it’s impor­tant, but it’s tak­ing those ideas and bring­ing them to life. Because the secret recipe of suc­cess is, is good ideas that iter­ate towards great ideas, no idea starts over. So good. Iter­at­ing, towards great, and then exe­cute, exe­cut­ed with dis­ci­pline over a very long time. And it’s the dis­ci­pline of exe­cu­tion, that gives you the feed­back and insights to help to iter­ate the ideas and make them bet­ter, and they’re kind of sym­bi­ot­ic they go hand in hand, if you do it real­ly, real­ly, real­ly well.

Brad Giles 17:19

Yeah. Gone,

Kevin Lawrence 17:23

was say­ing, and then, you know, and oth­ers, you know, when it gets into this kind of this space on the, on the ideas, they’ll play the me to com­mod­i­ty game and chase easy or acces­si­ble rev­enues and oper­ate at 3%. Net, or lose mon­ey on unprof­itable clients or ser­vices. They’re just, they’re not spend­ing the time to ana­lyze. And I’m not say­ing that peo­ple aren’t capa­ble. In a lot of busi­ness, they actu­al­ly don’t have the data. Yeah, they actu­al­ly don’t know that the finance or account­ing team is so busy just try­ing to get invoic­es out, get the books done and col­lect the receiv­ables. They don’t have time to zoom out and use their intel­li­gence to pro­vide the oper­a­tors of the busi­ness insights on how to run the busi­ness bet­ter. And that’s what’s a gap we see in a lot of grow­ing com­pa­nies. They just, they’re doing the best they can they don’t have the time to think.

Brad Giles 18:14

Yeah. And often I think that they’re they think about them­selves as being a part of an indus­try. So if they were a home builder, they think we’re in the home build­ing indus­try. There’s no like we do what the indus­try does, we build homes, they don’t think to they don’t use that intel­li­gence to think how can we evolve our busi­ness mod­el to be sig­nif­i­cant­ly more profitable.

Kevin Lawrence 18:36

And that’s why I dri­ves me bonkers when peo­ple start talk­ing about indus­try aver­ages and best prac­tices. Well, indus­try aver­age is mediocre and best prac­tices is dri­ves your right into that mediocre mid­dle and I hate it. Now you can look at if you look at indus­try data, you want to look at the best. The high­est per­form­ing one or two is what you should bench­mark not don’t bench­mark the mid­dle unless you want to be mediocre. And I get crazy pas­sion­ate about that exists. You know, we look at the best prac­tices real­ly are com­mon prac­tices. I agree. I don’t want to be com­mon. I total­ly agree. Yeah. So So back on the intel­li­gence piece, you know, it’s real­ly the idea to seize the great oppor­tu­ni­ties that have an impact on the client, throw the client and you can gen­er­ate great prof­its to that’s, that’s the idea. It’s an abil­i­ty to see it and see the things that would make you 20 or 30%. Net as an exam­ple or dra­mat­i­cal­ly enhance your growth rate or or, or, or even lock up a cus­tomer and get incred­i­ble loy­al­ty of our cus­tomer or a big group of cus­tomers, what­ev­er it hap­pens to be. There’s many forms of win­ning but intel­li­gence can see things I mean, we both work so incred­i­bly, incred­i­bly Intel­li­gent CEOs and exec­u­tives. And you know, I could tell you about 20 of them that just blew me away. And that’s where I’ve learned so much over the years is these amaz­ing peo­ple, you know, one of my clients, I’m gonna keep this gener­ic, but he found a way to lock up the top five cus­tomers in an indus­try in a way, where they spent every dol­lar through him, and con­trac­tu­al­ly could not spend any mon­ey on his com­peti­tors. With a five year retroac­tive clause, if they spent $1. Up until the last five years, all of the dis­counts were owed back and he gave them mas­sive dis­counts. So it would have been the 10s of mil­lions of dol­lars, they would retro active­ly own him. So big teeth in that con­tract. But because he had those five, who had to give a sub­stan­tial dis­count, he got the rest of the indus­try. And, and actu­al­ly, I think it was, it was five top clients, I think when I’m sor­ry, it was a cou­ple of dif­fer­ent indus­tries. But he got the top cou­ple of lead­ers in an indus­try. And then the rest of the busi­ness was there, because this top cus­tomers was there. It was incred­i­ble. So that is intel­li­gent, basi­cal­ly con­trol­ling the mar­ket by doing a lucra­tive con­tract with a few. And then you get the mon­ey. Again, that’s, we call those x fac­tors. They’re bril­liant, it’s in on same with the, the hus­band and wife team in Cal­i­for­nia. They, he, she oper­ates the palm brand of its pome­gran­ate juice, and he has the brand Won­der­ful Pis­ta­chios, both pre­mi­um brands in their space, they were one of the biggest landown­ers in the state of Cal­i­for­nia. And if you know any­thing about Cal­i­for­nia, con­tro­ver­sial issue that has been in Cal­i­for­nia, is the water con­sumes no farm­ing con­sumes more than 80% of the water in the state of Cal­i­for­nia. And pro­duces notably less than 10% of the GDP. And water is scarce. Well, this cou­ple, a lit­tle bit on a smart side, and going back about 10 years, they had secured and own more than a third of the water in the state of Cal­i­for­nia, they own it, yes, they sell water rights in the Unit­ed States of Amer­i­ca, own­ing water in a farm­ing area, that also hap­pens to be an area that requires irri­ga­tion because it does­n’t rain enough, is a big com­po­nent that’s damn intel­li­gent, not only to see the oppor­tu­ni­ty, but to find a way to buy that and con­tin­ue to con­trol it through the law­suit. So there’s there’s end­less, end­less exam­ples. But you know, it’s about think­ing about how you have a notable impact on an indus­try in a way that’s good for you. And or your customers.

Brad Giles 22:48

Yeah, cus­tomer work, we’d bet 200 mil­lion, they would have been GE an eight or nine on dis­ci­pline, but a one or a two on intel­li­gence. So let’s move on to discipline.

Kevin Lawrence 23:04

Yes, and the main thing about dis­ci­pline is it’s, it’s learn, it’s not human. Right, humans are cre­ative and free think­ing. And, you know, by nature, I mean, some peo­ple are more dis­ci­pline than oth­ers. Actu­al­ly, I will say that some there are some very dis­ci­plined peo­ple in the world. And, you know, the truth of it is with­out dis­ci­pline, those ideas are a dime a dozen. They’re not brought to life in a con­sis­tent way that, you know, that pro­vides insights and you know, can help iter­ate the ideas and make them bet­ter, you know, he need dis­ci­pline to imple­ment things. And this Collins would say, you know, suc­cess is real, relent­less exe­cu­tion of the bor­ing base basics that fit in your hedge­hog, hedge­hog being your sim­pli­fi­ca­tion of your busi­ness mod­el, relent­less exe­cu­tion of the bor­ing basics. That’s dis­ci­pline. And as we’ve talked about in the com­pa­nies that we work with, we bring in a lot of dis­ci­plines. And why do com­pa­nies want to gen­er­al­ly keep work­ing with us long term, is because we keep that dis­ci­pline engine going on the parts that are hard to have dis­ci­pline around. It’s hard to con­tin­u­al­ly have deep finan­cial reviews, and KPI reviews and goal reviews, and to hold ten­sion in the room to tru­ly look at the account­abil­i­ty and how to be bet­ter next time. Yeah, there’s 14 Oth­er things to focus on. So dis­ci­pline is is crit­i­cal. And it’s some­thing we all includ­ing myself can always get bet­ter at. And that’s

Brad Giles 24:33

why the great teams, they under­stand that an exter­nal advi­sor that what you and I do, the way that we apply things, it’s not just about oh, we need I want to learn some­thing new all the time. It’s about let’s come back and keep us on track. Like get some­one who isn’t an employ­ee to keep us on track. Under­stand best prac­tice and we spoke about that ear­li­er, but you under­stand what is the best prac­tice to keep us on track and Have that exter­nal dis­ci­pline that exter­nal focus on what we’re doing?

Kevin Lawrence 25:05

Yeah. And it’s some­body to run the damn meet­ing, because run­ning a meet­ing is one hell of a dis­ci­pline. And it’s not easy. Yeah, you’re run­ning a two or three days strate­gic meet­ing with 10 1214 peo­ple. That is very, very chal­leng­ing, not for the faint of heart. And to do it, well, you need to do it a lot. Right? Because it’s, it’s a dis­ci­pline. That’s why you go to a mas­ter on that stuff.

Brad Giles 25:28

Yeah. So it’s the dis­ci­pline of not tak­ing on new things, under­stand­ing the strat­e­gy. The we’ve spo­ken about all of this stuff, like it’s the week­ly meet­ing, the dai­ly meet­ing, the quar­ter­ly, the annu­al meet­ing, all of those com­po­nents about hav­ing the right data and the right met­rics, and equal­ly hav­ing the right pri­or­i­ties that are struc­tured in a way that you’ve got three to five pri­or­i­ties and not more for each busi­ness depart­ment indi­vid­ual, and that you’re focused on those things and not get­ting dis­tract­ed importantly.

Kevin Lawrence 26:06

So like the com­pa­ny I shared with you that no, they’re get­ting anoth­er ad 100 mil­lion of Napa get­ting pret­ty damn close. Every quar­ter for more than 10 years, I get face to face with them, except dur­ing COVID. Yeah, and we spend a morn­ing doing a full finan­cial review, full rock review, full KPI review, cus­tomer feed­back, employ­ee feed­back, we do a full tal­ent review of our top per­form­ers like and we do every­thing by divi­sion by region, by line, like we split it all up, like we split up and, and dis­sect the entire thing. And then we do an after action review. Great. What do we do? Well, how do we do bet­ter next time, every­body makes no, so how we’re going to have a bet­ter quar­ter next time, then we have strate­gic debates on the impor­tant stuff that the dis­ci­pline to grind through the impor­tant things and make those deci­sions. And then we go and set our goals for the next 90 days at the com­pa­ny lev­el dis­ci­pline to break down into detailed action plans that we’re going to fol­low, get­ting feed­back from the col­leagues in the room, fur­ther enhanc­ing the action plans for the quar­ter. And then every­one sets their indi­vid­ual goals for them­selves on their team. Like, and we’ve done it 4050 times. Yeah. And it’s you know, and we’re always it’s enhanc­ing, it’s get­ting bet­ter and bet­ter. But we’re just, we’re grind­ing it out. It’s, it’s, it’s, it’s like run­ning laps in soc­cer or foot­ball prac­tice, you know, just grind­ing it out get­ting bet­ter and bet­ter and bet­ter. Awe­some. And shock­ing­ly, it works. Not shockingly.

Brad Giles 27:42

Yeah. So I think we’ve, I think we’ve cov­ered off our main points. Is that right?

Kevin Lawrence 27:46

We have Yes, let’s just sum­ma­rize. prof­it, or sus­tain­able endur­ing busi­ness that is high­ly prof­itable is intel­li­gence mul­ti­plied by dis­ci­pline, right? That that you got to have the good think­ing, and then you got to bring it to life relent­less­ly. And real­ly, under intel­li­gence, we talked about not all busi­ness mod­els are cre­at­ed equal­ly, some peo­ple will make five points. So the bot­tom line when oth­ers make 35 in the same busi­ness, and it’s not just about prof­it, but it’s no more prof­it, you have more options. And we know these ideas are abun­dant. And it’s the dis­ci­pline to grind things out, that brings that intel­li­gence to life. And real­ly, if you’re not care­ful, and you don’t do enough think­ing, you can push your­self into a com­mod­i­ty zone, and accept low­er returns. And even­tu­al­ly, you know, a busi­ness that makes three points in an indus­try that nor­mal­ly makes 10 or 12. And needs 10 or 12 puts a lot of con­straints. And it real­ly can con­strict you as you grow the busi­ness or even try to grow the busi­ness. Right. You want to take over on the intel­li­gence side, Archie, no, that was­n’t a one more intel­li­gence is it’s real­ly what seems to be oppor­tu­ni­ties and focus­ing resources on oppor­tu­ni­ties that pay for the cus­tomers and you and things like X fac­tors and lock­ing up top cus­tomers or own­ing the water in the state. Those are all tiny exam­ples of things that took a tak­en a lot of think­ing and intel­li­gence to bring to life. Any­one did the dis­ci­pline piece broad.

Brad Giles 29:13

Yeah. So suc­cess is relent­less exe­cu­tion of the bor­ing basics over a long peri­od of time. And that goes against the human nature, human brains need for cre­ativ­i­ty. And it’s tough. But prof­it comes from the mul­ti­pli­ca­tion of intel­li­gence and dis­ci­pline, you’ve got to have that intel­li­gence aspect. If you’ve only got the intel­li­gence and you don’t have the dis­ci­pline. You know, you won’t have the prof­it that is so impor­tant. And then we spoke about the tools, KPIs goals, finan­cial report­ing, cus­tomer feed­back, all of those tools, but in the broad sec­tion of exe­cu­tion, which is mak­ing sure that we’ve got the right pri­or­i­ties, mak­ing sure that we’ve got the right Rhythm and mak­ing sure that we’ve got the data and the KPIs. And so when we main­tain that dis­ci­pline, and then we mul­ti­ply that by the intel­li­gence, that’s when we get the profit.

Kevin Lawrence 30:14

Yeah, con­sis­tent­ly. Awe­some. Well, hey, you know, and the ques­tion we can leave you with is, you know, on your com­pa­ny, what do you need to shore up more dis­ci­pline for intel­li­gence think­ing, or get­ting the crit­i­cal stuff done? So thanks for lis­ten­ing. This has been the growth whis­pers pod­cast with Brad Giles and Kevin Lawrence. For more infor­ma­tion on the show, you can go in and check it out or watch the YouTube ver­sions of the show actually@​youtube.​com Search the growth whis­pers for Brad evo­lu­tion. part​ners​.com​.au. And for myself, Kevin and myself, Kevin, Lawrence and co​.com I was gonna say my email there, Kevin. But by the way, if you have ideas for ques­tions you would like to have Brad and I answer on the show. You can con­tact Kevin at kevin@​lawrenceandco.​com or Brad@​evolutionpartners.​com.​au. Email us if you’ve got spe­cif­ic ques­tions you’d like us to answer and we will do that on a future show.