$30M CEO: How to Build a Business That Runs Without You

Want me to 1-on-1 audit your business to learn exactly how to hit the next level of scale? 
Click here  👉 https://bit.ly/Cole1on1Jordans

========================================================================

Using calendly/oncehub to book calls? And experiencing low show rates? Check out https://bit.ly/SalesKickJordans

Saleskick is a booking/calendar system designed specifically for sales teams to:

-Decrease cost per booked call (faster load times, better CRO, etc)
-Increase show rate
-Auto-confirm appointments via AI
-AI score every lead so it's delegated correctly...
And more.

========================================================================

Pick up rate for your setters below 20%? Try https://www.dialer.io/

After generating 50M+ solely from outbound appointment setters in our own company…

I’ve packaged all the best setting practices into a software that simply allows your setters to click “Dial” and work the leads in the most efficient and profitable way possible.

This leads to: 

-Higher answer rates 
-100% TCPA compliant dialing 
-Less burned phone numbers / categorized as spam 
-20-30% increase in overall sets per day production

…and more.

========================================================================

00:00 Introduction & Ranking 16 Systems
02:05 Cole's Number 1
08:42 Jordan's Number 1
14:55 Cole's Number 2
20:18 Jordan's Number 2
26:06 Cole's Number 3
32:40 Jordan's Number 3
39:12 Cole's Number 4
45:36 Jordan's Number 4
52:41 Cole's Number 5
59:24 Jordan's Number 5
01:06:18 Cole's Number 6
01:13:42 Jordan's Number 6
01:20:55 Cole's Number 7
01:27:31 Jordan's Number 7
01:34:08 Cole's Number 8
01:40:52 Jordan's Number 8

Transcript

SPEAKER_01 0:00

So I'm here with Jordan Schumacher, CEO of Leader, which does over $30 million a year. And combined with both of our companies, we've done over $225 million in lifetime revenue. And in this podcast, what we're gonna do is break down the eight leadership lessons, systems in our companies that we use in frameworks that have ultimately not just allowed us to scale out of our companies and scale up to a multiple eight-figure level, but do it in a way to where our companies don't entirely depend on us. So if you're somebody who needs help with hiring eight players, hiring superstars, building up executives in your company to where you can remove yourself out of the company and ultimately create systems so your business runs without you, this is gonna be the podcast for you. So, Jordan, how are we doing?

SPEAKER_00 0:39

Doing great, man.

SPEAKER_01 0:40

Okay, so we're gonna cover these eight things, and I'm gonna be selfish on because it's my own podcast and start with the first one. So, my number one thing, and this is a lesson that I've learned hopefully enough times where I don't have to learn it again, but I'm probably gonna learn it again. And I told you a little bit about this last night, is this is the axiom, which is every unit of time you spend recruiting sends 10 saves 10 times the units managing. So every single unit of time you spend recruiting saves you 10 times that amount of time in managing, right? And so I'll give you a little couple stories is so for me, I've I've made this mistake three different times. So the first thing was I always knew that I was a good sales trainer, right? Like I can train sales. And so um in one of my companies, you know, when I went back, when I went from having three companies back to one, I came into actually being the sales manager again. And I kind of just, you know, it's kind of embarrassing because I run a sales recruiting company, but I got lazy with the recruiting because I just figured, you know, okay, this guy's good enough. I'm really good at training sales, I can train them way up. And like some people I did, but one of the biggest breakthroughs that I had is I ran an analysis on all of our different sales reps. And so I want you to guess, I wanted to see basically out of everybody who's worked out over the past couple of years, how long it took them to get into KPI. And so I want you to guess how long it took.

SPEAKER_00 2:06

From everyone. So we're talking all the people who worked.

SPEAKER_01 2:09

Yep. Uh 30 days. So the top 10 percentile of reps, they were in KPI within the first three days. The first three days. And I mean, there was times where like I was so over-indexed on myself as a manager where I'm like, I'm gonna spend, you know, 90 days fucking trading, which is embarrassing because this is like what I do. But it's almost like I'm like, oh, well, I would never tell a client to do that, but I'm like, oh, well, I'm different because I'm so good at sales training. So the top 10 percentile was like, which was like our best reps, three days. Then the let's say other top like 50 percentile, so people who were like they made it and they were above average, they took anywhere from 30 to maybe 70 calls, which is anywhere from two weeks to a month, and they were pretty much in KPI. And they also uh the other common thing we saw in that uh progression was that essentially they all they all consistently got better. Everybody who worked out was a consistent improvement. Anybody who did well and then went into a rut never worked out.

SPEAKER_00 3:16

That makes a lot of sense.

SPEAKER_01 3:18

At least for us, yeah. Yeah, I don't know if you've had experience with that.

SPEAKER_00 3:21

My experience is what we found is an incredible correlation between a rep's past income levels and like where their set point is and where they tend to cap out on any new offer. And so interesting. If like that's one of the things that that we test for, and certainly we don't recruit as many reps as as y'all do, but we spend a lot of time on how much were you making at your previous offers because what we've found is we will we would have a rep come in and maybe they were making 15 grand a month on average at their last offer. They'd come in and absolutely crush it on our offer, maybe make 20, 25 grand, and then immediately tank the next month because their set point was at 15 grand a month.

SPEAKER_01 4:01

Yeah. Well, that makes perfect sense. Yeah. Which is kind of weird because it's like the comp structure almost kind of effed you in some ways. But uh for us was the opposite. So we made a couple changes. So, number one, once I realized that, I was like, okay, what I'm gonna do is is, you know, it's just interviews, even I mean, I'm a I literally do a recruiting business. We do 600 interviews a month, you know, for our clients and stuff. But you know what's like one of my our manager is doing the interviews. A lot of times I would catch them doing just like finding the next person who is good enough. And the key is is to literally force yourself to just two to three, maybe even five times the amount of interviews that you do for a single role. Because like, I don't know if you've had the same experience, but I've found that if you do 20 interviews for a single role, a lot of times the person you end up finding is somewhere between 12 and 20, to where you're like, holy shit, you know, this this is the fucking and you'll know when you find it. It's like you go from like, I think they could where you're like, holy fuck, even if we didn't need this person, we got to make room for this person, you know. Like that's kind of if you make every hire like that, where it's like the you've had that before, you're like, man, we don't have like the room for this person right now before we need to find we need to find the room. Yeah, yeah. Well, what if you just did that for every hire? You know, you'd have a pretty good team. I'm I'm also kind of talking to myself here. So, anyways, that goes back to the axiom I was saying is like every if you if I just spend a little bit more time recruiting, then I have to spend way less time managing. And I'll tell you another story about this, and this is the one I told you yesterday, is for our recruiting team, what we did, and we did the same thing with the setters, all we did was we increased the pay uh team-wide pretty much by 30%. And, you know, that might that only might be three or four grand a month. That might not seem like a lot to us, but to somebody else, I mean, that's a massive difference, a 30, 40% increase in their pay. And so when we did that for our recruiting team, and it happened with our setter team too, literally, it like you access in the recruiting marketplace an entirely different trough of talent. And we were able to basically turn over most of our recruiting team in the past 18 months, and it's just the best team we've ever had. The setters, like I was telling you, we increased the pay by 30, 40%. Now all of our setters, we have on-track earnings for 8 to 12K, whereas most people are like paying their setters like five to seven, five to nine. So eight to twelve K. I when I made that shift, this is at the end of last year, I essentially outlaid 25k extra a month in labor. But the setters we brought in, which were really closers who I downsold into being a setter, so they were like junior closers with an ascension path to being a closer, they outperformed so much that I was telling you yesterday we cut, we were able to cut ad spend by 250 grand a month because we generated so many more appointments. So it just goes to show, and like the moral of the story is number one, it's to increase the volume. But a lot of times, even in just increasing the pay to like the top end range of the pay scale, you can have a team of less people who's more efficient and better. And the other thing is too, is you need way less like processes and systems and whatever. Because that was the other thing, is like it was with the recruiting team, especially. We spent years not thinking we had the right process. We need to make more SOPs, we need to do this, we need to do more training. We just raise the caliber of talent. Turns out we didn't have any of those problems. We just didn't have good enough people.

SPEAKER_00 7:20

It's so true, you know.

SPEAKER_01 7:20

So a lot of people they just get in process system masturbation, and it's like they don't have the good enough people. And if you have a good, I mean, if you have good enough people, they will actually make the fucking processes. Yep. You know, so I don't know if you found the same thing before you move on to year one.

SPEAKER_00 7:33

No, uh a hundred percent. I think in my early days, I had this story that I told myself, which was I'm gonna find like raw, unproven talent, I'm gonna pay below market rates, capture the arbitrage, and because I'm such a great coach, I'm gonna coach them up and they're gonna just, you know, be the uncut diamonds that that become incredible.

SPEAKER_01 7:51

Yeah.

SPEAKER_00 7:51

And number one, there's no higher ROI investment that you can make than like the labor on your team, like the labor efficiency ratio of you pay an extra, like you said, you paid 25 grand extra to save 250 grand announcement. That that doesn't exist anywhere.

SPEAKER_01 8:06

Even with a recruiting team, we actually ended up needing less people, so we paid less than we did two years ago for more production. For more production. And everybody makes more, so they're all happier.

SPEAKER_00 8:16

Yeah, I I I see that, and it I'm speaking to my past self here of not wanting to pay above market rate because of whatever I felt market rate should be or was fair or whatever. And it's just the data is just overwhelming. Pay more, access top 1% talent, and it pays for itself in pay in space.

SPEAKER_01 8:35

And being a good coach and a good leader and a good manager is not about training bad people to be good, right? It's about training good people to be even better, and it's actually really like great leadership is you recruited an amazing person in the first place, and it's not really a ramping thing. Yep, it's a retention thing. And this is what I think if if if every single person on your team was so good to where you were thinking, not how can I train this person to be better, but how can I keep this person? Yep. Because that is still a training management skill set, right? Because you still have to identify with really good hot top performers where they're lacking, how do they essentially get better, how to keep them happy, how to keep painting the vision, how to help them maybe make the improvements in their personal life. But you know, most people they only have maybe two or three people in a department tops where they're thinking that way, or even worse, they're spending the majority of time on all the worst people and not on all the best people, and the worst people are the most likely to churn, anyways.

SPEAKER_00 9:30

Yeah, and then and then your best people feel ignored and that they're with people who suck and then they churn too.

SPEAKER_01 9:35

Yeah. So, anyways, that was my number one. What's your number one?

SPEAKER_00 9:37

Can I ask you a couple questions on that? So, the learnings from the ramp period with your sales team, right? Yeah, my top performers ramped in three days. How did that actually change your ramping behavior with with new hires?

SPEAKER_01 9:48

Well, I mean, number one is we just had way less leeway. So we were like, okay, if they ramp, I mean, the best, not so when I say the bet the top 10 percentile, I'm talking like Hall of Famer level reps. Yep. They basically were in KPI in the first week. Like the people who are, they're not just number one one month, but they're like, they can stay number one or number two for 12 months at a time. They just basically they were good right away. So, number one, how did it change the ramping behavior? Okay, well, the main thing is is if we focus more on recruiting and we just get somebody really fucking good, it's so much easier for us to manage those people, which also, by the way, means we can have a bigger team because my my rep to manager ratio can go up. And I can have a flatter organization opposed to a taller organization, right? A lot of tall organizations are because a lot of people fucking suck. So you have to have a lot of sucky people, and then you have to have sucky managers to manage the sucky people. So then the other thing, what it what changed about the ramping behavior? Um, the other thing, especially okay, with sales, is we don't need to give them as much time. We don't need to give as much call volume. So we'll just test more people and we split their calendars. So you know how our system runs. We have live transfers, so we'll we have enough volume of live transfers where we'll split live transfers, we'll split new calendars, and then we let see how they do it two weeks of that, and then they'll be churned. We might have some churn from that, and then it kind of just filters down and filters down and filters down. But frankly, like it's it's usually obvious who is good right away, and it's just getting out of this muscle of I can fix the person, right? It's like you know, if you're in a bad relationship, you're like, I can fix the person. That's a bad relationship, you know? It's the same thing as you really want to see, and I'll give you a great example. We have a great vintage of new guys coming in right now, and one of the things I have seen from this vintage is when somebody you have to obviously you have to have good training. Like, you know, imagine building a course for your clients. There needs to be a course for your new employees, kind of like actual training and SOPs and all that stuff to go through. If I listen to the first call and my first impression is like, damn, you know, this dude went through the freaking training. Like this is polished, right? If my cause especially too when they're raw like that, usually they follow it to a T. It's actually later on when they start adding in their own shit, which can be bad or good. If I'm like, damn, that person went through the training, damn, that person kind of kind of fucking sounds like me almost because they reviewed so many of my calls, which is what I tell them to do in the training. That's a good sign. They almost always work out. If I watch a if I watch the first call and I'm like, I don't even think this person, I'm like not even gonna give them feedback. I'm gonna tell them to go back through the training. You should just fire that person. They I have never had anybody like that work out. I totally have you ever like had somebody where it could be any position, but you're like, okay, I'm not even gonna give you feedback because like you should have just gone through the training and it's almost like I'm just gonna tell you what was in the training. So if I have that, I just fire them because they're not good. Now, obviously, you need to like lead them the right way and set clear expectations and have good onboarding. I mean, you know, those are all givens, but as long as you're doing that, yeah, if you have that behavior, that's not good.

SPEAKER_00 12:54

I think it's the it's the permission to like give yourself permission to make the cut quicker because the opportunity cost and just the hard cost of ads if you're running paid traffic of keeping a rep for longer than you need to is just so high. Like super high, super high.

SPEAKER_01 13:08

And it's actually faster to again, if you make your average higher at interview five, waiting until interview 20 is much faster because the goal is to get a ramped rep, right? Or a ramped employee no matter what the position is. Yep. If you rate wait till number 20, you're actually gonna get there faster, even though you had to wait a couple weeks longer in the recruiting process. You know, so that's one thing I would say for sure is just it's it's a big thing. It's like the more time you spend recruiting and the more you also pay at the top of the market, you know, it makes everything so much, it makes your life so much easier.

SPEAKER_00 13:45

I think the heuristic, and then I'll move on. I think the heuristic, I think Bezos has this quote in one of his shareholder letters is someone, but it's basically like does this individual raise the caliber of the team that you're hiring them into? Yeah. Uh for me, the the number one thing that I've seen that will immediately improve the performance of any department or team or company is just super simple, but I don't see it happen nearly enough. It's just implementing a daily 20 or 30 minute huddle with a simple KPI sheet where every single person shows up to that huddle who's up involved in the department, reports on a single KPI with red or green metrics, and what the number one objective is for the day. Yep. Uh I have never seen anything that like you can implement and with certainty see it to cause behavior change on a team or a department and actually move things back in the right direction.

SPEAKER_01 14:34

Yeah, and with whatever essentially you also want to fix within your company. I'm trying to think there's something just recently that uh I cannot remember what it was, but we were having a problem and like something just wasn't going well. And I was like, okay, we're just gonna set up a meeting cadence, and it might not even have been it it wasn't even daily. It was just, I mean, we went from no meeting cadence to we're like, let's meet on this problem two times a week. The problem's fixed. Yeah, it's just we needed to meet on the problem. But you know what's funny is is that when I first started the sales training recruiting company, you know, obviously we give them recruits, but the thing is, is most people, especially in our industry, they have no idea how to run a sales team, let alone a team. And the thing is, is they don't know how to run a team, but if you don't know how to run teams, it really shows up in your sales team, right? Conversely, if you know how to run a sales team, you can probably run almost any team. I mean, you know, obviously a developer team or something that's kind of a different skill set. You know, there's it's not a whole blanket thing. But if you can run a sales team, you can run the fulfillment team. If you can run a sales team, you can run the marketing team. If you can run a sales, because it's just the most highest performing team, and your how good you are as a recruiter, hire, manager, leader, etc., shows up immediately in the metrics, right? So like it's just obvious if you're good or not, which most people aren't good, but then they're like, oh, there's no good salespeople, whatever. So, anyways, we give them the rep, and then you know, what I realized very early on is they're not good at being a leader, training, managing, etc. And I'm trying so what I was trying to do is figure out what are like the little things I can do that make the biggest impact that we can implement with clients ASAP. This is like 2020, and dude, none of these people were running sales meetings. We run one sales meeting a week. You know, I'm like, so we kind of came up with this big concept called the big three, run daily sales meetings. I'm I might forget one of the three. Oh no, I remember. Run daily sales meetings, then it was implement like visible tracking, pretty basic.

SPEAKER_00 16:29

Pretty basic.

SPEAKER_01 16:30

But you know, you'd be surprised. Sometimes I'm like, show me your tracking, and I'm like, can you read this? And they're like, no. And I'm like, well, like the tracking is for you as a CEO. You know, you don't if you can't read it, I know your ops person made this and they think it's great. If you can't read it, it has no purpose because you need to read it and make decisions, they're making it for you. So daily meetings, proper tracking, and then end-of-day reports. And then honestly, the next level of end-of-day reports is our manager just calls every single rep at the end of the day and asks how to do it.

SPEAKER_00 16:56

I love that.

SPEAKER_01 16:57

That it dude, it helps so much and it is annoying probably for most managers because it's the end of the day. But you know, reps they go through their day, they have a bad day, they're like, I hate my life, I forgot how to sell because it didn't close anybody today. So you gotta like dust them off, and it's you're gonna be okay, buddy. Yeah, get a good night of sleep. So those three things, if we could just get clients to do those three things, that's it. Oftentimes, I mean, there was one company we worked with. Um I can probably say it, we worked with one uh subsidiary of Agora Financial, or yeah, Agora Financial. And they have like a bunch of different they're like a conglomerate, but they have one company that does all the phone sales for all their divisions, and we worked with them. And they're they were very bureaucratic, right? So it's hard to get things done and changed, but we did, we did just tell them to run a daily meeting. And this guy ran a daily meeting for like two weeks, and I think he had, I mean, they did a lot of revenue, and I think they had like a 10% lift in revenue just from that. And I mean, we're talking like they're doing like you know, hundreds of millions, so they had like a 10% lift in revenue, their best performance ever, just by meeting daily.

SPEAKER_00 17:58

It doesn't, I mean, that's incredible. It also doesn't surprise me, and it works for marketing, it works for sales, it works for fulfillment. In another company I was involved with, not leader, we were having an issue on the fulfillment side where basically our turnaround time for a deliverable was like 12 hours, and it needed to be six basically per team member. And they were meeting once a week on Mondays to kind of like go through forecasting. The first thing that I did is I said, Okay, moving forwards, we've got a Google Sheet, everyone has their name and the number of deliverables, and we're just gonna meet every morning at 9 a.m. and we're just gonna fix and we're just gonna cover how many deliverables were done the previous day. It's so easy. Literally within three days, it was fixed.

SPEAKER_01 18:38

Yep. So it is so interesting. Like anytime I launch a new initiative, like if you launch a new thing and it doesn't go anywhere, and honestly, there's I'm actually just thought of something where I'm like, I'm actually making this mistake myself, I should have a meeting for this. But if you launch a new initiative and it's not going anywhere, most of the times there's no I call those initiative-based meetings. So you need a cadence for that. And and frankly, the the tighter the cadence is, like if you want to make something happen really fast, meet at the beginning and at the end of the day. It is gonna go fucking super quick, right? But it's just natural that people need deadlines. You know, it's why in sales, when when a prospect wants to push to a follow-up call and they're like, dude, just send me the link, just send me the link. I promise I'll do it. I'm like, no matter what, even if you're a hundred percent positive they're gonna do it, you have to set a follow-up because even just psychologically, it acts as a deadline. Yep. If you ever wanted to get my one-on-one help in terms of scaling your business, then listen up really fast. So we're taking on a few clients to where I can personally one-on-one audit their business across marketing, sales, operations, fulfillment, finance to be able to tell you what your constraint actually is. And ultimately, what are the one to three things you need to do next to be able to scale working entirely one-on-one with me? So if that's interesting, there's a link in the description that'll say call one-on-one that you can go book. But essentially, not only will you get my personal advice, but we'll also be opening up our entire playbooks of my $36 million year company across marketing sales, operation fulfillment, finance. So you can basically model the best practices of what we've done right into your business, and it'll include the opportunity to meet in person up at an event with me. So if that's interesting, click the link in the description and mount back to the video. Okay, you ready for the next one? Let's do it. So you're gonna love this one. Have you heard of the, I got this from Ryan Dice. Have you heard of the culture skill matrix? No. So culture skill matrix. So imagine, and maybe we could even put this like as a as a thing on the screen. So imagine you have like a matrix, right? Yep. And so on like this side, the y-axis, is culture fit, and this side is skill, right? So like you go the further you go up here, the more culture fit. The further you go here, higher skilled. So obviously, in the bottom left of the matrix, you're gonna have not a culture fit, not skilled. You're probably not gonna hire that person, or you're just gonna fire them pretty easily, right? Then over here, right, in the top right, you would have culture fit and skilled, right? Like that's an A player, you know, you're gonna keep that person, you wanna focus on retaining them, etc. Then, so in the bottom right, you have highly skilled, but not quite a culture fit, which is what we called like the lone wolf. So we have that, and then you have a high culture fit, but not as much skilled. Now I'm gonna I'm curious what you think. What do you which one of those two do you think is more of a problem?

SPEAKER_00 21:30

Is more of a problem? The lone wolf.

SPEAKER_01 21:32

I disagree. Really? Yeah. So the lone wolf, sometimes they're too lone wolf, and yes, they gotta go. A lot of times you can rein that person in. So like you've heard um oh, there's some story and Harmosy tells it, but it's like there was some maybe it was like Steve Jobs when he was a maybe so maybe this is not a story Hermosy tells. But I think like Steve Jobs or somebody like that, when they were in their first job, they were so eccentric and so like. Crazy and hard to deal with, but they were so brilliant. The manager was just like, Look, we gotta lock them in a room, and I think they even assigned somebody to just like make sure that nobody like nobody even just had to interact with them. You know, just guard the door. I forget who did that. I think it was maybe, maybe it wasn't Steve Jobs. Maybe I'm mixing up Ken Griffin. But there is times where it can work if you can manage it correctly and it's position dependent. I think the um, so the top left one, culture fit but not skilled, I call that the likable underperformer. How many people have you had because alone wolf, you know it's kind of an issue, and you can kind of gauge it. We need to let this person go, or like fuck, okay, we can manage it or whatever. It's fine. The likable underperformer is what kills people because you're like, okay, well, I really, you know, Susan, she she's just trying so hard. She's great. I mean, she's such a culture fit. And in the middle of you saying that also, you know, she's not been performing for three months. Let's just give her another pip. She's already been on a pip, let's pip her again. You know, let's let's give her more resources, let's give her more training, and then you start catering to this person, and these people just stick around forever, yeah. And then do they ever perform usually? No, right? I mean, I'm you know, I'm not saying you just fire them immediately, put them on a pip, try to give them the resources, whatever, but you gotta move them up or move them out. But people people keep the likable underperformers for way too long. Some people's teams, it's all likable underperformers, just a bunch of culture fitty people who aren't good, who have no edge.

SPEAKER_00 23:38

I don't know if you disagree with me, but I I agree and disagree. So I agree that like the likable underperformers is the biggest trap that you can fall into because it's so easy to give them another month, exactly like you said. I think the risk with the lone wolf, though, is it can like if you have multiple of those individuals that aren't closely managed, it can just destroy the overall culture and trust on the team.

SPEAKER_01 24:00

Well, think about it this way: is every tumor cancerous or are some tumors benign? True. So as your lone wolf, it's like a tumor. Yep. Is it benign or is it propagating? Yeah, I I that's that's that's the thing. Some tumors are benign. And there's some people also with strong enough leadership, they're a lone wolf in every other culture, they'll they'll they'll fit into our frame. Yep. Right? And so as long as and it also depends on the role. If you have a developer who is a lone wolf, but like they don't have to interact with anybody, or maybe they just interact with you and that's it, and like they don't need to interact with anybody else on your team, it's also not that big of an issue. So I think it depends. I have I let go of lone wolves, yes. I told you about one yesterday. I can't say it publicly, but I have done it, and you have to sometimes. Yep. But I do think I think people understand that. My point is is that more people mess up the likable underperformer.

SPEAKER_00 24:55

I completely agree with that. I think it's it's almost like the Dennis Rodman effect, right? Like you can have a Dennis Rodman, but also Dennis Rodman was really fucking good and it worked. And you also had to have a Phil Jackson. Yep, exactly.

SPEAKER_01 25:04

So, like if in a Michael Jordan, so if you don't have the right leaders, like if you put him on a different team where he's the best player, it's it's not gonna work. Right. So, anyways, what's uh why don't you go to the next one for you?

SPEAKER_00 25:13

Yeah, next one for me is probably the thing that has impacted like my day-to-day decision making more than anything else, and it's the theory of constraints. And so it comes from a phenomenal book called The Goal by Ellie Goldratt, written in the 1980s. I would recommend anyone reads it. But basically, the TLDR of the book is that business is just a system, and in any system, there can only be a single constraint or bottleneck, and any effort or investment into any area of the business that's not the constraint is literally a waste of time. I've made this mistake so many times where I am naturally very good at marketing. And so in my head, everything is a marketing problem, and I try and solve everything through the lens of marketing, but oftentimes marketing is not the constraint, and it's just a waste of effort to attack.

SPEAKER_01 25:58

When everything looks like or when all you have is hammers, everything looks like a nail.

SPEAKER_00 26:01

Exactly.

SPEAKER_01 26:01

Well, most of my clients do the same thing, and I always say, you're trying to solve a sales problem with marketing, or you're trying to solve a sales ops problem with marketing. Uh, sometimes I'm like, you're trying to solve a fulfillment problem with marketing, you know? And so it's very, very common, and it's just and and I have this issue too, is like I try to solve a lot of problems. Like if I look at when I think of new businesses I could do or start, I always think call funnel, sales team. Like I just like think through the lens, can I run ads? Call funnel, sales team. Okay, I'm not interested. You know, and so and I think of that too. I think of can we just I think a lot of things through sales, you know? Yep. I'm like, oh well, is there a fulfillment problem or can I just train the sales team how to set better expectations? You know?

SPEAKER_00 26:43

I think the other piece where this really comes into play as well is like as you grow as a leader of your team and the average caliber of your team increases, the ideas that your team has are genuinely going to be good. And there's always an infinite number of like really good ideas that your team will bring to the table. I think teaching your team this framework allows you to actually prioritize in a cohesive way. Yeah. Where it's okay, that's a great idea. Does it actually solve the constraint that we're facing this month? If not, let's park it and come back to it at a later time.

SPEAKER_01 27:12

Yeah. Do you do this at your off-sites? Because what I do is I identify what is the number one constraint for the company and the prep for everybody's off-site in my memo. I write before the off-site. I write a memo so they can kind of know where things are at and what I'm seeing before they write their preps. And then so we operate off a single company constraint. And then each department, I kind of guide them to identify their own constraint in their department, which in order to do that, they also have to know what's the actual goal in their department. So each department has a departmental constraint or a departmental goal and a constraint of that goal. And so all their prep is just designed around that. Does that make sense? Now, now the reason we shifted to this is because I don't know if you had offsites that were like this. We'd have offsites and it just becomes this like brain dump of everything we could do that doesn't fucking matter. And then everybody's assigned a bunch of tasks at the end.

SPEAKER_00 28:13

And then nothing gets done.

SPEAKER_01 28:14

Once we shifted to this, or or or stuff gets done and just done in that port, we're like, why do we do this? Yep. When we shifted to this, there's there was way fewer tasks assigned. And then essentially what happened is we only focused on the things that actually mattered. It really helped us. And it was way less overwhelming, and we got done way faster.

SPEAKER_00 28:33

I love that approach. We we started with that approach, and then we moved, like as the company grew, it became less clear that there was like, oh, a single constraint in the organization that all departments could contribute to. And so we sort of drifted away from that uh and and moved into like, okay, well, what's the number one priority per department and sort of took a bottoms-up approach, and it just wasn't nearly as effective. And so we've since moved back to like, nope, everyone is focused on the number one constraint in the business, and departments should have some priority that unlocks that constraint. Yeah. And when we did that, it's just everyone is focused, everyone knows how to prioritize. That's essentially what we're understanding. Exactly. Yeah, same process.

SPEAKER_01 29:10

All right, you ready to move on to the next one? Okay, I have another matrix. We need to cue the image. So I call this the healthy standards matrix. I had to come up with a name for it yesterday. And the premise is also that there's kind of a combined lesson to this, which is you don't want to react to a situation in the micro, you want to react to the pattern of this potentially happening a hundred times in the future. So first I have to explain the matrix. New matrix, okay? Okay, y-axis and x-axis. So you as a leader, the y-axis is your emotional regulation. So at the bottom, you have like you're super triggered, and at the top, you have like you're very grounded, okay? Then on the x-axis, you have essentially your degree of like radical transparency. So like your inner Steve Jobs, we'll just call it. Okay. So if you're basically at the bottom where you're very un un you're not direct and you're also very triggered, what is that? I'm curious if you can guess.

SPEAKER_00 30:09

Passive aggressiveness?

SPEAKER_01 30:10

Exactly. So you're triggered and indirect, right? Let's move one over. So let's say you're super direct and you're triggered. Which is anger. Your dick. Well, yeah, I call it the tyrant, right? Which is kind of like the Steve Jobsy type of thing. Yep. Right? Then, top left, you have basically the relational pushover to where you're super like you're grounded, but you can never put your foot down. And then in the top right, you have like grounded candor, which is like, you know, if you've read the book Radical Candor, I've kind of adjusted this from that. But it's basically like you can be a strong leader, you can be warm, but you can be direct. Yep. Right? And the key is you have to be very direct about everything. And what people struggle with that is they they they oscillate between either usually most people, to be honest, they oscillate between passive, aggressive, or tyrant, or they it's like they have like two they're caught in, but they never really end up here. The key is you have to be very direct, but there's a difference between being very direct and being triggered and not triggered. So if somebody's late to a meeting, if you're like, why are you late? Like if you're like, why are you late? That's very triggered. Yep. But if it's very calm and it's like, Sam, why are you late? It's it's there's like a diffusion of the energy, right? And so it's like that combination of being a strong leader who's very direct, but you're not being triggered. Will Gadera, you know, the guy, uh Unreasonable Hospitality, that's who I got this from. Is he's like I there's some video where he explains it, but he's like when he's ordering people in his servers around the restaurant and giving them feedback and criticism, like he's not in the because you know there's like different camps where there's like a camp where you should just praise everybody all the time. I think that's also like kind of BS. Like I think praise is also very important because that's reinforcement, but you have to give feedback. And the key with feedback is you can't do it from a triggered place of energy where you're projecting yourself into the situation and you're essentially being like, I would have never done that, I would have never been that stupid, therefore, I'm really mad that you are stupid. Does that make sense? Yes, it does. I'm curious if you have any thoughts on that.

SPEAKER_00 32:15

I completely, completely agree. And in my experience, it's what what was the the upper right quadrant, like someone who's in that state, the relational pushover. Upper left. Upper left, there you go. The relational pushover will often flip-flop between that and tyrants because what happens is this is what I was gonna say next, is it's the jack on the hide.

SPEAKER_01 32:33

So this is what happened with clients. I was coaching this lady the other day, and she was basically like, My team thinks I'm a I'm such a bitch. And I'm like, okay, what happened? So I start asking questions, I start diagnosing. What I figured out was she was bringing on these sales reps and they were being late to a meeting and they were doing this and they weren't filling out their admin and they weren't filling out the report. And she was giving them the benefit, oh well, I'm kind of upset about this, but I'm gonna give them the benefit of the doubt. I'm gonna, okay, whatever, you know, it's fine. I'm not gonna say anything. But then she got three weeks in, and then it like there was a trigger, right? And then all of a sudden she's like, Why the fuck aren't you filling out your reports? So it goes from the passive aggressive to boom, like now I'm triggered one way, I'm triggered the other way. Whereas it wasn't addressed immediately in a non-triggered way, which sets the standard for how everything happens, which was what I was gonna say is my next next concept. I got this from some lady who did PR for uh Palmer Lucky and Anderol and like Elon Musk and all these people, just got it from a podcast. But she was saying, like, these great leaders, they re they they almost sometimes seem like they're overreacting to certain situations, but what they're doing is they're react they're reacting to not the situation, but the pattern of if that situation happened a hundred times in the future. So let's say somebody shows up late to a meeting, and let's say it's five minutes late. I have a process in my company where if you show, I mean, there's certain departments where you should really never show up late, but like if you're in sales, okay, your call might run over, you can show up late, but you have to let the group chat know you are running late and you're on a meeting, and also how long you think it's gonna take. I mean, that's a quick message takes two seconds. Yep. So there's a clear process for that. If somebody does not follow that process, I immediately stop the meeting when they come on the meeting and I'm like, John, you didn't put anything in the chat. Why are you late? In front of everybody, right? And then I'm like, okay, great. You understand that's not the process. So you can't do that. Cool. And then usually what I'll do that's kind of like a little uncomfortable, but it's direct and it's not triggered, usually just to kind of break the tension. If I can, I'll just like find something, I'll poke fun at somebody else, I'll make a joke, kind of breaks the tension, then we're we're back to the meeting.

SPEAKER_02 34:36

Yep.

SPEAKER_01 34:36

If it happens again, I'm gonna call it out again and be like, look, you know, this is how we do it because we have a core value of this, that behavior doesn't align with this. You have to find a way to show up and follow this process, or we have to find a way to part ways gracefully in front of everybody. Done. But it's like calm, you know, and it's important that everybody else sees it so they know where you stand with all these things. Because the weird thing is, is people think it's like I'm being a dick, but actually it makes everybody else feel safe because the more people understand where they stand with you, the more even if it is like okay, there's clear boundaries, this, but one when people understand what your boundaries are and they're very clear, they actually feel safer around you. I know that's a paradox.

SPEAKER_00 35:23

It makes total sense though. Like, there's nothing less safe than someone who's a Jekyll and Hyde, right? I think the other piece too that I know you do a great job of is like the consistency of feedback, right? And and I think, at least for me in the past, anytime I've held back on giving feedback, it's like, ah, I don't want to, you know, throw this person into a mental loop or what whatever the thing is. The more frequently you give feedback in a non-triggered level way, the more it normalizes the feedback so that the other person doesn't have an emotional response to it either. Which again, and they'll actually like the feedback, exactly, right?

SPEAKER_01 35:56

Because you're giving it to them in a non-triggered way, you're just trying to help them and you're trying to serve them. So, again, to put a bow on what I was saying, it's um again, is them being late to a meeting one time that big of a deal? No. But imagine what you always have to do is what if this happened for the next 100 days? What would my reaction then be? Well, you'd probably be pretty pissed. Well, don't be pissed, but you need to correct the pattern.

SPEAKER_02 36:20

Yep.

SPEAKER_01 36:21

Not and and so people who seem like they have those meticulous high standards, it's like, wow, he's so crazy about them showing up on time. Well, I am crazy about having a company where nobody shows up on time. So I have to nip it in the butt right then and there. So I don't know if you have anything else on that.

SPEAKER_00 36:38

I completely agree. And like, particularly in a remote company where Zoom calls or calls are the mechanism of communication. If you start to develop a habit where it's normal for everyone to be two minutes late, I mean, like if you actually amortize that out across the team, that's hours. Hours a lot of time on the city.

SPEAKER_01 36:54

And it's just lack of a standard, right? Like you have to let people know exactly where things stand at all times. There's it's got to be clear.

SPEAKER_00 37:03

I totally agree. Cool. What do you got next? Next, uh, running on an operating system. So this goes back to running a team, right? Like for a remote company, which I think most people listen listening to this are in a remote environment, you don't have the benefit of a daily commute and an in-person office to create structure and allow organic conversations as a team. And so the way that you overcome that is through structure in the calendar and structure in the communication cadence. And so the process that we use is uh very similar to to EOS. I don't know if you're on something uh similar. Um we we love it, but it's basically having a set criteria where every Monday the leadership team meets and we go over the company level metrics, and every Monday, department level teams meet and they go over department level metrics. Right. And having that consistency of communication cadence throughout the weeks gives your team a place to bring issues to so that it's not just chaos in Slack. I think that a mistake that I see made is when there's no formal communication structure, week to week, day to day, month to month. There's nowhere for ideas or things to go. And so it's just it's just chaos everywhere. Go ahead.

SPEAKER_01 38:14

But we we basically do the same thing. I don't I don't call it EOS, but we meet our leadership team meets on Monday and Thursday. I found that cadence is fine. We could do more if we needed to, but I found this fine. I meet with all the departmental leaders on Monday, then also all the teams meet on Monday. So I mean that's kind of the same thing. Same thing. And then I mean a lot of the times too, we have I mean, a lot of the departments obviously meet every day. Yep. Right? Oh, this is what I was gonna tell you is I have an axiom as well, where anything that is if you if if you're like, like you've heard the term crucial conversation, I'll just use that term. Anything that is a potential crucial conversation, whether that's giving feedback, potentially having a disagreement, whatever it is, if you even think it's in that realm, it should be never be delivered over Slack. It should always be in a phone call. Because what I always tell people is you have to assume that written communication will be interpreted in the absolute worst way possible. And so I think having really good cadence in meetings as well shifts a lot of that communication on to Zoom, anyways, where people can get all levels of communication, not just the words. Because some people, I mean, some people too type the like I'm like, dude, you see how the way you type this message, like I know you didn't mean it this way, but it's totally interpreted this way. They're like, well, yeah, like, yeah. It's like when you have a disorder you gotta pick up the phone and just call. I don't know if you're not gonna do it.

SPEAKER_00 39:39

I I completely agree. Or at least a voice note because tonality is everything. Like you can come across as a total dick in a written message, and there's just so much that can be lost in communication. I I completely agree.

SPEAKER_01 39:49

Yeah. You want me to move on to the next one? Move on. So I call this gap coaching, and I also want to I combined it with talking about pips. I I I feel like you're a big pip guy. I like pips. Are you a big pip guy? Pips are great. So um the way I think about it, and most people I again, I kind of I I I I sort of like alluded to this earlier. Is number one, there's an issue with what, especially sales, but any performance level department, people's attention all goes to the worst people, the bottom 20% of the team, which by the way is the most likely to churn, and they're the worst performers. But the mindset is, oh man, if I could only get these people to perform like this, then my XYZ revenue would be this. My department would be doing this. Well, the issue is number one, those people are the most likely to churn. So you're having a huge sunk cost with all the time you're spending into them. And it's probably good, the more you spend time with them, the more likely you are to keep them too long. The people in the middle, those are the most likely people to actually go to the top, but you're not focusing as much time on them. And then a lot of them don't, they're like, oh my gosh, well, I'm so glad Susie is doing so well. I don't have to mess with Susie's just the greatest. I don't even have to coach her, she just does her job. But then Susie leaves, and then and when you ask her why she's leaving, she says, Well, you know, I'm not growing. Well, no shit, because she didn't give her any coaching, right? So, what I always tell the managers is with everybody on your team, you need to be able to identify it's just like sales, where they're at now and where they want to be, and then what's the key one to three things that's keeping them from getting to where they want to be? And so, like with sales reps, for instance, I'll I even know my managers know, but I even know with all my sales reps, what is the key thing with each of these people? Like, one, like one person, the main thing he needs to work on is when he talks to people who aren't the most qualified prospects, he gets really frustrated, then it bleeds into his next call. The other person, he needs to take more calls, all his metrics are good, he needs more live call volume. The other person, he has a low follow-up show rate. So, like something's happening, you know. So the main thing you need to work on is this. The other person, dude, your discovery really sucks. The other person, your business acumen, when you talk to higher level business owners, 100 grand a month to 500 grand a month, your closing ratio on that segment's really low. So I always have them, even the people who are really good, I'm like, hey, dude, you're really, really good. I think you'd agree, you're not as good as you potentially could be. So like you might even be the best on the team. But to get to the level in which I know you could be, where you could be doing this metric, that metric, this metric, and making ultimately this amount of money, there's a gap for you where you need to focus on this. And more you focus on this, and the more you really nail that down, the more you're gonna see like your income is gonna be up here and you're gonna look back at where you were and be like, dang, I can't even believe I was selling that way before. So, and and put more time on the best people. And the way I do it too is if you're doing team meetings like a sales meeting or let's say a fulfillment meeting where you're reviewing an upsell call or something like that, publicly you should focus on the top 25% of the team to give public feedback. Because if the best person was messing it up, everybody could, everybody else probably messes it up. So they can learn from any any mistake the best person makes, everybody can learn from that. But guess what? If the person does something really good, everybody can learn from that too. And what do top performers need? They need a little reinforcement and public recognition. So it's like, dude, you did so well. This is that can you explain why you did that? So then they're kind of coaching the team. They have like more of a status, they feel recognized, they feel better. And also instead of like taking the whole team meeting and ripping on the worst person where you're like, you did this wrong, you did that wrong, then the whole meeting's negative, your best person's like, I'm just gonna get on Slack because this is fucking boring. Like, this person's making mistakes that I was making three years ago. That's not engaging. So publicly focus on the best 10 to 20 percent, and then privately you just spread your time evenly. Does that I'm it makes a ton of sense?

SPEAKER_00 43:36

And I'm curious, like, what is your you know? Obviously, you can focus on areas for improvement, you can focus on things that are going well. Do you try and keep an even balance between that, or how do you balance out, like, hey, this sucked, or hey, this was great. Do more of that.

SPEAKER_01 43:48

Um, I'm just on again, it's a non triggered way. I'm just honest, but I just try to be honest about every single part of the call. This is good. This is not good. This is I mean, and sometimes I'll go through it, I'll be like, dude, this is. I don't have much feedback here. This is phenomenal. The real question is, why aren't you doing this every time? You know, like this is really good. So it just depends. But I will say this like, I I do try to if I have a feeling that okay, if I review this call, it's gonna be embarrassing. Like I'm gonna I'm gonna destroy this person, then that needs to be done privately. Yeah. Because nobody else is gonna benefit from that, anyways. It's not necessarily about I'm not afraid to destroy them publicly. I'm just like nobody else is gonna benefit from this. So I it's it's not a good use of everybody else's time. Okay, if the way you sell your product or service is through phone sales, you need to stop using booking systems like OneSub County, iClose, and other booking systems that aren't designed specifically for a phone sales approach or a phone sales team. So we at Salescake just launched a new calendar and booking system that'll decrease your cost per book call because it's conversion rate optimized specifically for call funnels, whereas most other calendar systems are meant for corporate all-purpose booking and it'll increase your show rate. So we've got clients that see 30 to 100% increases in their show rate because our calendar system is specifically designed for call funnels and other funnels that are high volume sales call booking funnels. And the software does so much more. It's really the only product designed specifically for sales teams with inbound booking systems. So if you're interested, go to saleskick.com, check it out, and now back to the video.

SPEAKER_00 45:15

I love that. And what what's your approach? Like, obviously, that's that's very like sales performance driven. Do you have a similar approach for non-performance roles, right? Maybe it's marketing, ops, fulfillment.

SPEAKER_01 45:24

Um, I think it's, I mean, a lot of it is the same. It just does it just the level of aggression and intensity in those type of departments aren't as much. But like, you know, it could be it could be as far as I mean, I'm always coaching people on how quickly can they get stuff done, what's their timelines, you know, what's their level of team communication, right? Are they being clear with their communication? Are they over-communicating? Are they following the core values? Hey, our core values are this. That means you have behaviors like this. When you did this and didn't uh move it through to the pipeline to let somebody else know you were done, and then it delayed the whole project by a week. Do you see how that doesn't align with our core value of getting stay in sync? So that you you asked me this. Thinking about getting stay in sync, what is the main thing you think you should have done in this instance? So I mean, I I do all that stuff too. I mean, obviously, in a marketing meeting, we're not gonna be reviewing a call from a top performer. I mean, we could be reviewing copy if it's a copy chief meeting, so like that would apply. But same thing with ops, a lot of that stuff is like more the behavioral standards, timelines, deadlines. A lot of that is also overcommunication, right? If that if that deadline was unrealistic, were you proactive at explaining, hey, we can't do this and here's why, right? Yep. So that's how I think about that. Last thing I'll say about pips. Uh I just don't think pips or pips or performance improvement plans, I just don't think they're used enough. I found with our team, and I give a lot of my managers a credit to this, because they have been more aggressive with pips than I naturally was when I was managing. And I find that the more people go on pips, number one, if it's truly somebody who is never gonna work out, they'll just quit. Then also, a lot of times, especially with people on our teams, because they do really want to make it work, nine times out of ten, it just gives them like an oh shit moment, and then they just they come right back up and sustain. You know?

SPEAKER_00 47:08

I love that.

SPEAKER_01 47:09

And so that's just what we found. I think it's because people like really want to stay here and they're good people, they just might kind of fall in into a little bit of a rut. Um, but I'm curious how you do pips and if you found the same thing.

SPEAKER_00 47:20

I definitely have. We don't do it enough. We should do it more uh and use it more as just a uh a standard coaching tool.

SPEAKER_01 47:25

Uh yeah, I mean, dude, we'll have like performers that have been good for like three years straight, and they'll three some of my managers will pip them. And it's they're like, oh shit, I'm on a pip. Like they just it it it and it's not like hey, I mean, there's different levels of pips. It's kind of like I call it like a pre-pip and a pip. So it's like you can even say you can even pip somebody that they're about to go on a pip. You know, and even that will help. And a lot of those people who have been with you for two, three years, you hit them with that and they're like, dang, like I I'm not the type of person who's on a pip. What the fuck am I doing? And you know, they just fell into a rut with the job, you know, because it becomes a job instead of like something where they're performing.

SPEAKER_00 48:05

Yeah, it's a and it's a huge pattern interrupt, right? I think a lot of people use pips. It breaks their pattern. Totally. Yeah. I think a lot of people use pips as like this is just the formality to go through before you fire someone, but if you actually use it as a coaching tool, it serves the purpose that it's intended to, which is improving performance.

SPEAKER_01 48:20

And it also instead of you having to fire people to just quit.

SPEAKER_00 48:23

Right.

SPEAKER_01 48:24

I know, I know you definitely probably have a bad experience.

SPEAKER_00 48:26

Oh, yeah, for sure. Yeah. For sure. Yeah. If if you put someone on a pip who is just not cut out or lack of engagement, has something going on personal life, whatever, you put them on a pip and they they opt out, which is the best case scenario.

SPEAKER_01 48:36

I thought you'd be a big pip guy. It sounds like you need to do more pips. Sounds like I need to do more pipes. Are you thinking about some people you need to pip right now?

SPEAKER_00 48:41

I'm literally taking notes over here.

SPEAKER_01 48:43

Or you think about somebody we're rolling out some pips. Well, um, I'm telling you, they work so well, and it's just good because if somebody's heart's not in it, they'll quit. Right. And if their heart's not in it, they're not gonna perform in a performance level position, they're not gonna perform anyways. Nope. And then other people, I mean, we've had people where you put on a pip, double performance. That's huge. And then they're fine, you know? And so I think, and and you can use the for the ex for your really tenured people, you do the pre-pip. You know, and I always end it off with and while that's not too exciting, what is exciting is like we wouldn't even be having this conversation if I didn't think that you really shouldn't be here. Like, I think there's no reason somebody like you shouldn't be here. And if I didn't think you could achieve X, Y, and Z, we wouldn't even be having this conversation. I'd be letting you go.

SPEAKER_02 49:27

Yeah.

SPEAKER_01 49:28

Right. So while it might not be that exciting that look like your metric needs to be here, otherwise we're gonna have to find a way to part way agree gracefully. What is exciting is like I'm a hundred percent confident that you should be there, and also I'm gonna give you the extra support by doing X, Y, and Z to get you there. I just need you to have the commitment that you're gonna work with me on that. You know, so it's like the what's not I got this from Josiah. It's what's not exciting, what is exciting.

SPEAKER_00 49:54

I love that. It's a little good framework. It builds so much trust too, because your team sees, oh, they're in it with me, they're investing in me. We're on the same side. I love that. Cool. What you got next? Next one is super tactical, but uh going back to the premise of this, which is if you're a founder trying to get yourself out of the business. I don't know if you had this experience early on uh at closers, but as you grow your team, you get to a point where all of the questions come to you as the leader. You're the knowledge holder, everyone's asking you for your opinion, your feedback, and it's just impossible to keep everything straight.

SPEAKER_01 50:24

Yeah.

SPEAKER_00 50:25

And the phrase that I implemented, I got this from a book called Turn the Ship Around by someone in the Navy, an admiral. The premise I have that book on my shelf. I've never read it. Dude, it's a I mean I can give you the TLDR. It's a great book, but the TLDR is a single phrase in the book. And so the premise of the book is Admiral uh or gen whatever in the Navy takes over the worst performing, I believe it was a submarine in the Navy, worst performing, bottom metrics at all levels. And so when he got in uh and and started taking over from the previous admiral, he realized that the entire crew did not make any decisions for themselves. They all routed everything through the Admiral, and so it was like the genius with a thousand helpers, right? It wasn't a real team. Yeah, and so the the there was a lot that he did, but the core phrase that he implemented throughout the entire team was moving forwards, no one on the team could ask him a question without ending that question with here's what I intend to do. I knew you were gonna say that. And I learned that from you actually. And it's so I wrote that down. It was one of mine too.

SPEAKER_01 51:26

You you fucking stole me.

SPEAKER_00 51:28

I'll take it. It's so trite, but just forcing your team to do this resolves like 75% of issues.

SPEAKER_01 51:35

All right. So I'll have to I'll have to give mine. That was my number seven. So I call it a three options rule, but I intend to either option one, option two, or option three. I think option X is the best one. But yeah, so people listening understand how powerful this is. The main thing, like when people are like, dude, I always you'll hear it like this. He'll say, I always get pulled back in. I always have to make decisions for people. I always have to clear the bottlenecks. I'm always getting pulled back in. That's kind of how they're like, I can't open my Slack. It's like it's just draining, you know? And the big thing is, is what's happening is you hired somebody's body and you didn't hire their brain, right? And you gotta sometimes like, yo, I hired your brain, not just your body, right? I need I need you to do the thinking. And the thing is, is what happens is is when you can implement that rule, what they start to do is they have to think through the solutions themselves. And the thinking is the most taxing part. So when they give when they do and preload all the thinking and then bring that to you, number one, you might be like, option one, done, right? Like how little of energy of that is you know, opposed to processing it, thinking of pros and cons, thinking of the different solutions, it saves you so much energy. The other thing it does is it helps you see their thinking because if you're really going to develop a team member, it's not about just coaching them on what they've done or their behaviors, it's about coaching them on their way of thinking because everything is downstream of that. If you have very high cognitive IQ people on your team, you know, you're like, this person's thinking is really good. So it helps them reveal their thinking, if that makes sense. And I think that is so, so key to actually be able to coach them. And it takes a lot of the, like I mentioned earlier, takes all the cognitive load off you. And a good analogy is uh do you have anybody on your team write your copy?

SPEAKER_00 53:24

Yeah.

SPEAKER_01 53:25

Okay, great. So if you have to sit down and write an ad and it's a blank page, right? How much more energy is that for you than let's say somebody brings you an ad and then you revise the ad, you chief it, and you might end up writing a whole new ad for them, but you're starting from something on the page.

SPEAKER_00 53:43

Yeah, it's 10x.

SPEAKER_01 53:44

It's 10 times, right? So, like, you know, a lot of times when I used to write copy for clients a long time ago, I used to say they may be like, Why do you want us to write it? Because like you're so much better at this, and like I suck. And I'm like, it's true, you're not good at this. However, they could write like the worst thing on the page, and I swear to God, I would just read it, and I just know I just know exactly what to do. Whereas I have to start with a blank page for them, I'd be like, I gotta do some research, I gotta do this. But a lot of times I'd read their ad, and this is what happens every time. You read somebody's ad, something that's three-fourths of the way down the page, you're like, Okay, that's a thing. I gotta move this all the way up, and now I gotta write the whole thing about this. But you you get it, you know what I'm saying? And so it also is like the non-blank page effect, and it reduces your cognitive load as a leader, you know?

SPEAKER_00 54:38

Absolutely. Yeah.

SPEAKER_01 54:39

So I was prepared for that one. Dude, you stole it from me. Sorry to sorry. Anything you want to say on that or you want me to move on to the next one? Move on. So um, this is how to rate gradually raise the standards and set the KPIs in your industry. So to raise the standards on your team, I think you'll like this one. So um, there's three steps. I got this from Andy S. Grove. Have you read that book, High Output Management?

SPEAKER_00 55:00

It's fucking great.

SPEAKER_01 55:00

You would like that book. I need to reread it because I read it when I was so like I didn't have a boy I think I read it when I was a sales rep, but um I need to reread it because I'd probably get like an entirely different version of it. But I got this from him. Um, number one, so here's how essentially like people are like, How do you have such high standards at your company? Yada, yada, yada. It's also the this is how I answer how do I get my sales reps to follow up? You don't you don't do it through building follow-up systems, you do it through this. So, first, you have to establish a culture where not hitting projections in your KPIs is not acceptable. Okay, that's step one. Now, in conjunction with step one, is you first have to establish that culture by setting projections that are very realistic. They can hit 100% of the time. And a lot of times that means you kind of have to teach them there's a projection, which is your bare minimum standard you're gonna hit if the shit hits the fan. And then you have your goal. You can have your goal, but like if you say you're gonna hit three this week and that's your projection, you're staying up till midnight on a Saturday, fucking going for three, right? So, like, what are you for sure gonna do? And so that process needs to happen for at least probably two or three months to where they get in a, they get in a habit. Like one of our core values is high safety ratio. When you say something, you do it. When you say something, you do it. You hit, you hit, you hit, you hit, you hit. And that builds a level of confidence that lends a certainty, certainty sells, especially for your sales team, but you could do this in all departments. So then what happens is is as they start getting in a rhythm where they always hit 100% of the time. They're always hitting. Because again, what the worst thing you want is, and I and I don't have an issue with like 10x, but I just it's a different concept, I think, that doesn't apply to this, is you don't want the sales rep every week to say, I'm gonna hit 10 and they hit two. Yeah. Like what does that fucking do? It just ever your words become meaningless. So the words have to start the words and the commitments have to start meaning something, and you have to do that by starting small. But then once the culture is established and you start to see people really like they're gonna hit their projection no matter what, you slowly raise it up. And you do that, and what what you want to do is you want to get it to the margin. The margin is where they could do everything in their power, but only 75% of the time they're gonna hit it. That's what I got from Andy S Grove. Because when they're operating at the margin of really what's like their comfort zone, their level of capability, their level of performance, number one, that's actually where how they get in the flow state. Flow state is the intersection between doing something that's challenging, that they're interested and passionate about, um, that's like challenging them. It's it's like not too challenging, but it's not too boring. Right. It's a it's another matrix. Yep, yeah. I like the matrix. So um you slowly cook it up. And what happens is, is as you have those people operating at the margin, what happens is like on a sales team, in order for them to start hitting their projection, they just have to do follow-up. Like there's no way they can do it without follow-up, because literally, if you're just relying on one call closes, two call closes, it's not possible. So, in order, like people ask me, how do I get my sales reps to follow up? This is how. Should you give them best practices and blah blah blah? Yes. But people are like, what's the cadence? What's the system? And it's like, okay, I can give you some best practices. There's no like automated fucking cadence. The best system is this system to have the right culture because if the standards are essentially high enough, they will just do it automatically. And I learned this from my own personal experience. When I sold for traffic and funnels, dude, we had some freaking high. This is what happened. This is what happened that I didn't know it. So when I read that book, I actually was like, oh, that's what was happening there. And I don't know if he read the book either, but like I just was like, okay, that's exactly what happened in my old sales job. Nobody ever taught me how to follow up. But I was probably one of the best fought long-term pipeline follow-up closers in the industry, if not the best. That was like, I was so fucking. If you talk to me, I was gonna follow up until you bother died. And I was very good at it. Nobody ever taught me how to do it, but I was forced to do it because I could have never hit my projections with just one call or two call closes alone. I had to do that. And I also thought it was unacceptable in that culture to show up on Monday and not hit your projections. I mean, you were you had some fucking explaining to do. It was scary. So I'm not saying you got to be scary or whatever, but you have to have that culture. And when you have it that way, a lot of these other things will happen as a byproduct of that.

SPEAKER_00 59:19

I love that. What do you do when you have a rep coming in, right? Who who does take the shoot for the moon, and even if you miss, you land in the stars approach to their goal setting. So they just set wildly unrealistic goals.

SPEAKER_01 59:29

I'm like, you can set whatever goal, you're not gonna talk about that on this meeting. You're gonna set a projection. Yeah. And then you can DM me what your goal is. You can do whatever your goal is. I care that you hit this.

SPEAKER_00 59:37

So you coach them down to like.

SPEAKER_01 59:39

Yeah, I mean, I'm just like, well, what we need, I need a metric that's realistic. You're gonna hit no matter what. You can write on your wall whatever the fuck you want to.

SPEAKER_00 59:45

I like that.

SPEAKER_01 59:46

I like that. So that's just how I do it. I love it. There you go. Anything else on that or you want to move on?

SPEAKER_00 59:51

Let's move on.

SPEAKER_01 59:52

Okay, what do you got?

SPEAKER_00 59:53

My next one is how to roll out a playbook system that you actually use in your company. So I think everyone knows like what a playbook is, why it's beneficial.

SPEAKER_01 1:00:00

And most people write when it never gets used.

SPEAKER_00 1:00:02

Exactly. And so what we implemented when we uh were rolling out playbooks, this was many years ago, uh, that actually worked really well is implementing a temporary role that we called the playbook czar. And the playbook's czar's only role was to just troll Slack once a day. And anytime anyone had a question, check to see, okay, does that playbook exist? If it does, comment in the thread, go check the playbook. And if it doesn't, assign a task to create that playbook.

SPEAKER_01 1:00:29

Oh, wow.

SPEAKER_00 1:00:30

And so we paired that with a team uh challenge for the quarter, which I think we just picked some arbitrary number of number of playbooks. It was like we're gonna create 150 playbooks this quarter, and if we do it, everyone gets a 250 massage. And so we paired those two things, and within 45 days, playbooks were being used on a daily basis throughout the team.

SPEAKER_01 1:00:49

That's pretty good. And what what what did you experience after that happened? What was the benefit of everybody using the playbooks?

SPEAKER_00 1:00:55

The benefit was the number of questions that were pulling people into conversations. Conversations, yeah. Yeah, that didn't need to be involved in.

SPEAKER_01 1:01:03

The conversational Slack traffic went down.

SPEAKER_00 1:01:05

Oh, yeah, it went down and people felt more empowered. The speed of execution increased because people knew now, number one, how to do things themselves. But most importantly, like the reason that most playbook systems fail is because they're never up to date. And so people know even if they look there, it's not gonna work. Right. Most importantly, people learned to trust the system, which allowed them to then actually solve problems themselves. Interesting.

SPEAKER_01 1:01:27

Yeah, we should probably do that. You know, I err so much on the side of what I said earlier, which is just try to hire really good people. You know, it's like when you hire somebody who's really good, they figure it out, they just figure it out. Yeah, you know, they're like, I'll make the playbook. I want those people. Yeah, I I think everybody wants those people, but they should do it. I I should honestly do what you do. I'm like, uh, it's like one of those things I'm like, oh, I probably need to do that, and I don't really want to, you know?

SPEAKER_00 1:01:53

It's it's it's short-term pain.

SPEAKER_01 1:01:55

You should I should. Yeah, that would make a lot of sense because things fall out of date too, and then you get on an off-site and somebody's like, hey man, the XYZ thing's out of date, and then you look at it, you're like, Jesus Christ. I'm like, how are you training people who are like shadowing? Like, okay, well, thank God we hire really good people because we have no like, I mean, I'm I I'm over exaggerating a little bit. I would probably say we're more advanced than most people when it comes to this, but we would we're probably we would be much better if we did that for sure.

SPEAKER_00 1:02:23

I highly recommend it.

SPEAKER_01 1:02:24

Okay. You ready for the next one? Let's do it. So, have you heard of Jeff Bezos's over-indexing on proxy metrics? No. This is from his Lex Friedman interview. And so basically, it comes from the story that he was in a meeting with executives, and he was arguing that he had heard, like from kind of qualitative level data, that their customer service line wait time was too long. And then the executives were showing him, no, look at the metrics, like it's 30 seconds or whatever. And so he was like, Okay, well, it says it's 30 seconds, but I'm like seeing all these reviews online or whatever it was, that it's not 30 seconds, like people are waiting 10 minutes or 15 minutes. So he just picks up the phone, calls customer support, and proceeds to wait 15 minutes. And so the lesson of this is that, you know, a proxy metric is essentially a metric that explains it's a proxy to try to explain what's happening in reality. You know, and always say the quality of your company is what happens on the quality of the front lines, right? So really how good or not good your company is, is only a measure of every single customer-facing interaction of your company. Does that make sense? So, like, as you go up to level, like different levels of tier management or things happening on the back end, they they can improve your uh the company or your quality if they empower the people on the front lines to do better. But realistically, it's like in our business, it's the ad they see if they got a setter call, or what SMS or email automations they got before that, what the funnel look like, what was the messaging on the funnel, the branding on the funnel, how are the setter and the sales conversations, how was the onboarding call? How was the contract and all the handoff process? What is after onboarding call like, what is time to value? How to, you know, all of those things, right? Like that's what the customer, that that's the whole thing, right? It's the customer-facing interaction parts of the business are essentially the quality of the business, which really all of these metrics, they're called proxy metrics, is our attempt to evaluate what's actually happening on the front lines. And sometimes they can be off. And you have to kind of go like founder mode and just really actually qualitatively look at what's happening on the front lines because there's two types of ways you can measure your business. There's qualitative metrics and quantitative metrics. Quantitative is the proxy metrics. Qualitative is like I look, I watched your sales call. I watched 10 of your sales calls, you know? And sometimes what's happening doesn't always doesn't always line up. So I'll give you a great example. You know what an MQL is. For people who don't know, it's a marketing qualified lead. So maybe somebody comes in, they apply, they answer some questions. We deem that as a, you know, we grade it one through four. Ones are like spam, they get canceled. Twos, we're not sure if we can help. We send those to a setter. Threes and fours are MQLs. And then from MQL, we have like an MQL, uh, like app to MQL ratio. We have MQ cost per MQL, et cetera. So there's been times across the company where we're getting a lot of complaints about leak quality. Then we look at MQL. MQL ratio, MQL cost is the same. So based on the Proche metrics, we're like, hey, there's nothing in the data that's validating what you're saying. Now, nine times out of 10, when the sales team complains about quality, it's like, dude, you just had a weird calendar in a bad couple of days. You're gonna be fine. Dust yourself off. Next week you'll probably have great quality. Yep. You know, you ever had your sales team, they're like, duh, quality sucks this week. Is there anything you guys did with marketing? And you're like, nope. And then the next week they're like, dude, whatever you're doing with marketing, keep doing it. The quality is amazing. You're like, I got you, buddy. You didn't change anything. Not a thing. Yeah, it's like always what happens. Uh, it's just, you know, but you gotta from their I'm not trying to shit on salespeople because I'm a salesperson. I love salespeople. It's just their day to day so micro that it feels so big to them. Whereas, like, we're thinking, As like a CEO or a marketing director at week to week swings. But there has been times where let's say the MQL hasn't changed. It's still around 350 bucks. And I'm hearing all this quality thing. And now I'm hearing it for like the third week in a row. And I'm like, okay, let me batch 50 calls and just let's just see who's on the phone. Right. And there has been, I'd say nine times out of 10, it's usually just like a weird thing that's happening. It's not really the sales team. I mean, it's not really the quality. It's just kind of a, you know, sales team kind of thing that's going on. But there's been a couple of times, maybe 10, 20% of the time, where I'm like, no, this is this is like drastically off. Like there was a time with RCA, this is probably in 2022, where I'm not sure what happened, but man, we were getting people with like face tattoos, out of prison, you know, consistently over 300 pounds, like disability. I'm like, okay, yeah, this is a quality issue. And then you look in and you're like, well, MQL says it's the same. And then I figure out they change the definition of what an MQL was. And so what happens sometimes is, and you can see this in companies, people over time, they'll play with the proxy metric and they'll optimize the proxy metric subconsciously by changing how the metric is actually qualified and how it's measured and how it's done. So, like another one is like we track refunds in in in several different stages. And we found that um we had this metric called non-onboarded refund, which means they refunded before they hit the onboarding call. I come to figure out what qualifies as a non-onboarding refund now is also they didn't sign the contract, which which is fine. I understand that's something you might want to track, but they might have onboarded. Okay, that's a little bit different, right? Or it's like they were sold a love it or leave it trial. Okay, that's a little bit different. And so, like what happened was is just all of this, everything just kept getting lumped into it's a non-onboarding refund. And it's an over-index on optimizing a proxy metric and not really just looking at what's happening on the front lines. And that's why I think there's such a trend to this, like founder mode, Elon, um, you know, Brian Chesky's about this now. There's also Jensen Huang runs his organization like this, where it's a flat organization because I think the more you can be in tune on what's happening on the front lines, the more you have like a better feel and a better optimization of what's going on in your business.

SPEAKER_00 1:08:21

I totally agree. Going back to your boy Andy Grove and high output management, like he describes this, and like basically you can view a department or your business as a black box. And the KPIs that you look at are like little slits, little windows in that black box. So you can kind of see a snapshot of things passing behind it, but you don't really know what's going on until you actually go there. Uh, to to your point on Elon, uh, great book, The Book of Elon by by Eric Jorgensen. One of his quotes is like, if there's a problem, you as the founder need to physically locate yourself where the problem is, which in the case of a remote company is like do the fucking call reviews. Go on the fucking Zoom calls and learn for yourself what to do.

SPEAKER_01 1:09:01

It goes right to the front line. Like if you think about your business as a conveyor belt or like a factory, like he literally does he goes and talks to the person at the problem where the factory is actually at.

SPEAKER_00 1:09:10

Yeah. And when you do that, an hour of that gives you more data than 10 hours staring at a spreadsheet.

SPEAKER_01 1:09:16

And you know what we used to do, and I'm like, fuck, we should do this again. It's one of these things, it's kind of like the thing you just mentioned, where I'm like, fuck, we should do that. And we we do do it, and then we stop doing it, and then we do it again. Is like when you're having certain issues with client success, it could be a lot of different things, is doing audits. It's uh what we call it, I think we call it client journey audits, to where you have somebody put together the sales call, the interactions in between the sales call and the onboarding call, the onboarding call, all the CS calls, all the Slack communication. And then, I mean, honestly, you could probably put that all together and like put it into an LLM and get a lot of good data from that. But it's like you when you actually physically go in and see the client journey, and you know, it's never that complicated. Right. It's usually like, oh, well, this is pretty obvious. Like nobody ever does that and comes away with like what should we do? It's like, oh, well, duh. You know, and this is why I say to our coaches, most people aren't stuck because they know what the problem is and they don't know how to fix it. They're stuck because they don't know what the problem is, or they're trying to fix the wrong problem. And so the more clear we can get an accurate diagnosis, the more clear on the solution that we could become. And the best way to get an accurate diagnosis is like what you were saying, going right to the front line.

SPEAKER_00 1:10:31

Yep.

SPEAKER_01 1:10:32

Cool. Anything else on that or you want to move on to the next one?

SPEAKER_00 1:10:34

Now let's move on to the next one. Uh, my next one is comes from Elon Musk. Uh, have you heard of Elon Musk's algorithm? Comes the algorithm.

SPEAKER_01 1:10:41

Delete.

SPEAKER_00 1:10:42

Yeah, yeah, yeah. I only I only need one, delete. That's my favorite. That's delete. Absolutely my favorite too. I think with you know, AI and vibe coding, it can be so tempting to create an automated solution around something that should never exist in the first place. And so Elon Musk's algorithm, his whole process for systemizing, uh, it's it's five steps. And so his first step is make your requirements less dumb. And so he's got a whole spiel around so many things exist, reports exist, so many processes exist in a company, just because that's the way it's always been done. And something might be done a certain way because some intern four years ago randomly said we should do things this way, and it just the system never got updated. And so, step one, before automating anything, is looking at maybe there's a report that you want to audit, looking at it and asking, does this report actually need to exist? And if so, can we make it simpler? And if not, why not? And who is responsible for telling me that we can't make it simpler? So that's step one. Step two is to your point, delete. Try very, very hard to just remove the process altogether. Is there anything that we can do to just delete the process altogether? It's my favorite. Also mine. Step three is simplify and optimize. So if we can't get rid of it, can we make it easier? Step four is accelerate. Can we make it faster? And only after you go through all of those steps in order, do you find a way to actually automate the process? And oftentimes when you do that, you find that the process doesn't need to exist whatsoever.

SPEAKER_01 1:12:09

Yeah. So you know how Elon was a double major in economics and physics? So um I, you know, that's a very like physics level of thinking about a business. And partly where I think he got that from, in a sense, is are you familiar with the equation of force equals mass times acceleration? Yes. So if you rearrange that equation, it also means that acceleration equals your force divided by your mass, right? So let's define these terms in business language. Acceleration is not just velocity, but it's the rate of change in velocity. So it's growth rate and how fast you're actually growing faster. Okay. So in order to grow faster, we all want to grow faster. I think we do. Okay. You either could do two things. You could have more force, right? So this would be like a good way to think about this is like the leverage equation from Naval Naval Robin Kant. You could add more people, you could add more capital, you could add more uh code, you could amplify it with media, traffic, but it's like, how do we add more? People, capital, labor, traffic, doing more. Okay. The other thing, though, to go faster is we could change the mass and we could actually make the mass go down. How do we actually define what mass is when it comes to a company? I haven't, I'm gonna think a little bit more about this because I haven't come up with a great definition yet. But I think it's the number of people in your company multiplied by the number of commitments that are actively made in terms of their roles, responsibilities, things they have to do, the level bureaucracy they have to go through, and the amount of initiatives and different things you're doing at the company times the people you have. Does that make sense? I think it's a really good one. And you know, too, like with people, if you take an organization from let's say, you know, five people to 25 people, that's a 5x increase in head count. But in terms of communication like pathways, I don't remember. It's like 125x increase. So most people, do you think they try to make their company grow faster by increasing the top end of the equation, force, or by decreasing mass?

SPEAKER_00 1:14:11

Of course, by increasing force.

SPEAKER_01 1:14:12

Ever I mean, dude, that's exactly what I do. Yeah. I'm like, let's do more, let's spend more, let's add more people, let's do this. But how can we just decrease the mass to go faster? And step one of that is delete, you know? And that's where, like, when I learned that equation and and thought about thought about it that way in business, I thought about Elon's algorithm and how deleting stuff is the fastest way to actually go faster.

SPEAKER_00 1:14:38

So that that equation, I had never thought of it that way, but I think it's 100% right. And I think also part of the reason that we have a tendency to want to just increase force is that's the thing, you get an immediate feedback loop when you add something and it creates a result. You don't get a dopamine hit when you delete something that doesn't need to exist.

SPEAKER_01 1:14:56

I do. Well, I'm just kidding. Uh I do. I get a big one. But anything else on that or you want to go to the next one? Yeah, let's move on. So it's my turn, right? It's your turn. So do you know the difference between competency-based interview questions and situational-based questions? Tell me. Okay. So Charlie Munger says if you want to predict somebody's behavior, do you look at their projections or do you look at their track record? You look at the track record, right? Because previous performance is the best indicator of future performance. So I'm not saying in an interview, right? A situational question is, hey, if we brought you into our marketing team, how would you go about building X, Y, and Z or integrating yourself into the marketing team in the next 90 days, right? It's a future-based question, and it that's called a situational question, right? I I do think there's value to those, you should ask them, but they're inferior. So I'm not saying they're bad. I'm just saying they're inferior to what's called competency-based interview questions, which is called C BBI. There's a book about this. And essentially, these questions start with tell me a story in which, tell me about a time in which, give me an example in which. So I'll give you a few examples you can use for sales. So tell me about the last time that you want a deal due to extreme, proactive, over-the-top, crazy level sales effort.

SPEAKER_00 1:16:14

I love that question.

SPEAKER_01 1:16:15

What happened? Right? See how you can't fake the answer to that question. Now, if I also, if a situation if I use a situational-based question and I said, hey, if you're in a situation where you have somebody who, you know, it's a come the Jesus level sale and you really got to push them over their fear to move forward, what would you do? Right. The issue with that question is it assumes that they can do what they say they can do, right? It's not referencing what they have done. And in that question, exactly, every great salesperson has some good war stories, you know? So another one is like, what was your best month at X, Y, and Z company? Okay, my best month was 20 units. What was your worst month? 10 units. Okay, well, that's like 50% of what you were actually capable of, right? So obviously there could have been changes in lead flow and this and that and whatever, but obviously that was 50% of what you were capable of. What was for you personally the biggest learning lessons from that experience? They say, blah, blah, blah, blah, blah. Great. And how did you take that to implement it? How did you implement those lessons to bounce back in the coming months and what happened in your performance then? So you see how like I teed them up into that question to where they can't escape the answer. It's like a reality-based question. You know, another one you could say is like, hey, so when I call your manager, what do you think they maybe say is gonna be like your biggest strengths? Okay, great, you know, blah blah blah. Awesome. And then what do you think? You know, maybe they tell me are your one or two biggest opportunities to improve. Okay, cool. And how long ago were you working there? Okay, that was nine months ago. In the past nine months, what have you specifically done to work on those two things?

unknown 1:17:50

Right?

SPEAKER_01 1:17:51

That's a great thing. So you see how you can't escape the question, right? I'm not saying you should just only answer, only ask those questions. People would be like, Jesus Christ, this person's like turning me into fucking roadkill on this interview. But it helps you understand like what have they actually done, not what do they say they're gonna do, right? Because there's an information, a symmetry in favor of the prospect on interviews, which means they have more information really about how they're gonna perform than you are. The same way a buyer has less information about how good your product is than the seller. And so what you these questions help you collapse the inf information and symmetry to have more signal, if that makes sense. Like another one is like, what are your main professional goals? Tell me all about that. Oh, I want to do this, I want to do that, great. What are your personal goals? Like, what are the one or two main personal goals that you really want to do? I asked this guy this and he was like, I really want to lose weight. Okay, great. And how long has that been your goal for? What have you specifically done in the past nine months to pursue that goal of weight loss? And this guy in particular said, I've lost 70 pounds. And I'm like, good for you, you know, good for you. And he does what he says he's gonna do.

SPEAKER_02 1:18:57

Yep.

SPEAKER_01 1:18:58

Right? You can't can you fake that? Oh, I want to lose weight, I'm working on losing weight. That doesn't mean anything. But he's actually committed to doing what he said he was gonna do. If you're a business owner who has appointment setters or an outbound sales team, you're gonna want to hear what I have to say for a second. So a multiple eight-figure business owner texted me the other day, and when he started using $.io for the first time, his pickup rates went from 9% to 20%. So imagine doubling your pickup rates and ultimately the throughput of what your outbound salespeople and centers are gonna get, how does that impact your business? The answer is a lot. So if you want to check out $.io for a phone sales outbound system, just click the link in the description or just go to $.io. Now back to the podcast.

SPEAKER_00 1:19:38

I totally agree. And I think like that particularly, obviously for sales roles, but for any role, particularly marketing, it's so easy for people who have never done marketing to sound like marketing geniuses because like theory is very obvious, but it's much more difficult to actually execute on the side.

SPEAKER_01 1:19:54

Same thing with sales, by the way.

unknown 1:19:55

True.

SPEAKER_01 1:19:56

Some people can spit out the NEPQ, the whatever I'm teaching, the all the stuff, right? And then you're like, dude, you sound like shit. And then you have another guy who likes Zen and vapes and has to smoke a cig at the end of the day, and he just rips, you know. So like it just it's just a difference, there's a difference there, you know. But anyways, continues.

SPEAKER_00 1:20:14

Yeah, and so asking asking the specific questions of what have you actually done, also listening for like specific objective KPIs and data tends to indicate that someone has actually done the thing or not.

SPEAKER_01 1:20:25

Yes.

SPEAKER_00 1:20:26

Like I have increased, you know, uh ROAS by X percent or my close rate. Anytime someone gives specifics, it's a sign that they've done the thing.

SPEAKER_01 1:20:34

Absolutely. Anything else on that, or you want to go to your next?

SPEAKER_00 1:20:37

Let's go to the next one. Uh, so this is coming from Bezos, going back to Bezos, a decision-making framework, and uh, I think it comes from one of his shareholder letters, uh, talking about the difference between one door and and two doors. Are you familiar? Yeah, yeah, yeah. One door and two way doors.

SPEAKER_01 1:20:51

One way and two-way doors.

SPEAKER_00 1:20:52

Yeah, and so for me, this has been super helpful. Uh, like in a business, so his whole premise is that a decision is like a door, and doors can be a one-way door or a two-day two-way door. A two-way door is a decision that you make that's relatively easy to back up and you can walk back, right? Like a marketing test. Most marketing tests are two-way doors. You test it, it flops, you turn it off, it's fine. Some decisions are one-way doors, meaning if you make that decision, you're either past the point of no return or it's prohibitively expensive to unwind the decision. And so his whole framework in terms of how to make decisions, how to assert the what he wants done in the business versus giving his team autonomy, is segmenting the decision into is this a one-way door or a two-day, two-way door? 98% of decisions are two-way doors. Right. And if so, then he is much more willing to take the risk and disagree and commit to something that someone else wants to be done to let them learn the lesson, even if he knows he's right, as opposed to on the two percent of decisions that are one-way doors, he's much more autocratic.

SPEAKER_01 1:21:53

How do you reconcile the fact that there's clear one-way doors? Let's change our offer. Yep. Right. But there's also two-way doors that are technically two-way, but there's differences in risk. So I'll give you an example. Like, if I want to test a new ad, if it doesn't work, we shut it off. I mean, there is actually risk in that because I got to put the money behind it, but you know, let's just say it's whatever. But let's say I'm like, we need to pay cut somebody. I mean, that's a two-way door. We could increase their payback up, but there's a risk that I decrease it and they churn. You know? So how do you reconcile? Because I don't think that's a a binary thing. I think it's like there's clearly one-way doors, and then it's how it's it's not, is it reversible or is it not reversible? It's how reversible is it?

SPEAKER_02 1:22:44

Yep.

SPEAKER_01 1:22:45

You know, like we rolled out an initiative in our company and we're rolling it back now. And you know, it's a two-way door. At the same time, I'm like, fucking ass. Like, I wish I just didn't roll this thing out in the first place. Like there's a cost to it, you know. So I'm curious how you reconcile that.

SPEAKER_00 1:22:59

I think, I mean, I've made this mistake multiple times too. I'm thinking of an initiative right now that that we're rolling back that's expensive. And I think it's on the front end understanding, okay, what what is the likely cost and like actually giving some thought to what is the cost of rolling this back? And then if there is a significant cost, making sure you've got either daily or weekly indicators into how it's going so that ideally you can course correct sooner as opposed to waiting a month or a fucking quarter and then it's super expensive to wind it back.

SPEAKER_01 1:23:27

The the work I I almost think the more risky it is, the more close it's closer to a one-way door, the longer the lead time between how do I say it, the leading and the lagging indicators, the longer that relationship is, the more risky it is.

SPEAKER_00 1:23:40

I agree.

SPEAKER_01 1:23:41

Because like you could do something in the first three months, it looks good, and then you didn't realize there was second, third, fourth order effects that are coming back in to bite you.

SPEAKER_00 1:23:46

Yep.

SPEAKER_01 1:23:47

You know, so anything else on that you want to move on. Move on. So uh, do you have a framework for like certain things you look for in every hire?

SPEAKER_02 1:23:56

I want to hear yours.

SPEAKER_01 1:23:58

Okay. Well, I want to know what how this compares to what you do. So I look for five things in every hire. This works, this is a more applicable thing towards performance level positions. You know, it's probably not as applicable, let's say, to an ops person, but like sales, fulfillment, marketing, this is really good. So I look for five things. It used to be three things, I expanded it. So you're getting the this is the first time I think I've uh said it. So I expanded from my uh three things to five. So the first one is specialized knowledge, which kind of goes back to what we talked about earlier. Like, have they actually done what you're trying to do? But have they done it specifically? And like I think about it like lanes, you know, there's different sales management, okay? You know, you could be managing a big team at Salesforce Enterprise, you could be managing a car sales floor, you could be managing a home service company with a bunch of selling techs, you could be managing a huge brokerage of real estate agents, or you could be managing a high ticket closers doing Amazon FBA. You aren't gonna tell me that those all those things are similar. The same way is there's different types of sales. There's like relational sales, like a mortgage mortgage broker or a real estate agent, et cetera. There's transactional sales, which I define as like anything that could be sold in a sales cycle of uh 30 seconds or less, or 30 seconds or less. That'd be quite transactional. 30 uh days or less, which doesn't mean you're treating, I hate the term because it's like it doesn't mean you're treating your prospect like a transaction. It just means like a fitness sale, it's all one call close. Like that's on the spectrum of transaction. I mean, that's like as much transactional as you can get. There's also enterprise sales. There's also like I would even say table side selling, like home service sales is a little bit different as well. And like almost all that service industry sales is a little bit different, like auto repair, HVAC, garage door, that's its own thing, right? If you take somebody from one, put them into the other, I'm not saying they couldn't do it, but you know, what I hear a lot from my clients, especially sales management, is they'll be like, you know, dude has an Amazon FBA coaching offer with six six reps, and he's like, dude, I just got the best sales manager. I'm like, yeah, what's going on? He's like, Well, they managed 400 real estate agents at XYZ brokerage. And I'm like, he's like, if they can manage 400, my my team's gonna be doing, you know, my team's gonna be 20, 30 reps in no time. And I'm like, dude, number one, the sales process is different. Number two, like, managing 400 people is I mean, it's an entirely different business for one. But number two, it's almost like an administrative position to a degree. I mean, it's not, but it's like a very executive numbers systems position. It's not like if you have six high-ticket closures, you might hire somebody and give them the title of sales director, but I always have this framework. I say there's the title and then there's the real title. And you need to know what your real title is. I'm calling you sales director, you're a sales coach. Or sometimes I'm like, you're a sales coach and therapist, because you need to dust these guys off, regulate their emotions, and coach them on how to be better. You're not, I mean, yes, director, whatever, you're really a coach. Because at our in our industry, especially, you know, if you have a team of less than 15, 20 people, which is most teams, you're not, you don't really need a director to redo your whole sales process and to play a bunch with the CRM and do this and that and then tell you to change your marketing, right? You need somebody who just coaches these guys, creates a relationship with them, retains them, trains them. It's like coach, QC stamped on the forehead, right? But a lot of people don't do that. So the first one is specialized knowledge because they have to have done the thing, but it's specifically the thing. You know, like if I build a company in high ticket or whatever you call this, uh online service. If I build an online service company, if I go build another online service company, you would probably take a good bet I would do it successfully. If I go build a B2C uh consumer application that requires a network effect, you're probably gonna be like, I'm happy for you, man. You know, cool okay. You're like, holy shit. Like, you know, maybe I succeed, but I'm basically just starting all over with some requisite business knowledge. So, and I'm not saying, you know, you're not allowed, nobody's allowed to go build something different, but you know, you wanna you wanna think about the one step away rule at Max. It's like they need to be one step away. Like maybe they had a 20 or 30 person Amazon FBA team or a high-ticket team, they're going back, right? So it's like they're they're still one step away. Or maybe it was they had a fitness coaching offer that they got to $2 million a month, the sales manager. And yeah, Amazon FBA is a little bit different, but like, I mean, that's barely a half step away, you know? Okay. So the next one's industry acumen, which means, and this is again marketing, sales, fulfillment, ops, finance, probably not as important, even though finance to a degree, it can be important, is how well do they understand the specifics of the industry? Right? So, like, can they speak the language? Like every industry is kind of a tribe. Like, if you go to an event, can this, if this person showed up at an industry event, would they follow all the lingo? When they're talking to other people in the industry, would those people be like, oh, they're one of us, or oh, this is an outsider? Does that make sense? You know, I'll give you an example. I've been studying a lot the home service industry. There's different lingo. You know, so when they say turnover, do you know what that means? Uh no. You would probably think employee turnover. Yep. No, it means the amount of uh tech, basically the amount of service calls that turn from the techs that turns into replacement leads.

SPEAKER_00 1:29:25

Interesting.

SPEAKER_01 1:29:25

At least in HVAC. That's what turnover means. So, you know, I'm studying this industry, I'm like, turnover. Like, they're like, oh, we want really high turnover. I'm like, what the fuck? You know, no, that it's a totally different thing, right? So can they speak the language of the industry? Well, in sales, fulfillment, marketing, I mean, marketing's obvious, right? This is really important because if you can't speak the language of the market, how are you going to market to, sell, or coach the market? Do they want to be coached by somebody who's like them or somebody else? Right? The best way to be a good coach or a good salesperson or even a good marketer is in a lot of ways to fall in love with the market. Like you, if if you really are obsessed with the market, you can really speak to a specific chunked-down version of that in your marketing and so on and so forth. So that's very important, right? The third thing is assertiveness and disagreeableness, which I would say is not necessarily that important for marketing, but I would say it's important for sales and fulfillment, especially if your coaches need to be strong leaders. And so this is really for performance-based uh only. But you've heard what's the personality test that there's a Myers Briggs. It's not Myers Briggs that does um assertiveness disagreeableness. Yeah. It's I forget what it is, but there's one you can test this on. But it's like their level of presence, groundedness, confidence. And a lot of times you know if you have this, because these people generally they either in the interview process need to be sold a little bit, which people think is a red flag. The best people you're ever gonna recruit need sold. Of course. Yeah, it's like, come on, dude. Um, either that or they're like relentless with their follow-up, you know, like they're just like persistent and assertive and aggressive. And you also see it in the interview process to where like they'll be very specific about certain questions they want answered. They might even cut you off, but in like a in like a respectful way, and they have a presence about them that leads a conversation, they're very articulate. So you need kind of that like like the way you want to think about it is okay, if I'm hiring a coach or a salesperson, is this the type of person who can hold somebody accountable at the end, right? Or if they get out of line, they can realign. Are they somebody who can be direct, right? And it's kind of like that matrix we talked about earlier. We want the directness with warmness. And and by the way, when I'm hiring people, you know, I know the the bottom right was tyrant. Obviously, that's a that sounds like an aggressive word, but it's easier to actually take a tyrant and turn them into an emotionally regulated leader than it is to do the opposite. Because in anything that you're ever training, it's much easier to train people when they've crossed the line, and then you're like, all right, dude, you cre you you you're up here, the line was over here. You you kind of see how you crossed it. Like this was the line. You you're way up here, dude. So I need you to come back. It's easier because now they see the line. Where if they're if this is the line and somebody is essentially like they're not even up to the line in terms of let's say assertiveness, it's hard for them to even see what that looks like. Does that make sense?

SPEAKER_00 1:32:17

Yeah, it's easier to subtract than it is.

SPEAKER_01 1:32:19

Yeah, it's why we always tell salespeople err on the side of being too aggressive because when you cross a line, we'll help you see where the line actually was. So assertiveness, disagreeableness, that's number three. Number four is work ethic. So a lot of ways you ought to be able to identify this is people with extensive morning routines, people who have extensive learning and training, like reading and courses and whatever regiments. Um, do they do extra work on weekends? Like you asked in the interview process, how do you typically spend your weekend? That's not like a oh my god, they don't work weekends because they have four kids. I mean, look, like, you know, it's fine. But I'm just saying, like, somebody who's like, oh, I work every weekend. Okay, they have the work ethic. So, and also if you test for this in the personality test, I think it shows up as conscientiousness, which doesn't really sound like work ethic. I don't know why that term is related to that, but that's what I've heard. And so, you know, a lot of guys, like, I have a guy right now who's starting, and this guy is like so like I mean, it's like religious about honing in his craft, and he just studies, like, I'll give you an example is I mean, he's the type of person who when he takes that first call, you're like, dude, this guy's gone through the training. And also, like, we'll review a little bit of a call in a meeting. He'll just on his own go review the rest of the call by himself afterwards, stuff like that, right? And then the fifth thing is buy-in, of course. So buy-in to the mission, vision, and values. I don't know how you think about mission, vision, and values, but I feel like is the vision is where we're going, the mission is why we're going where we're going, and the values is how we're gonna interact on the journey of going where we're going.

SPEAKER_00 1:33:48

I totally agree.

SPEAKER_01 1:33:48

You know, so like I think about it like we're we're getting in a boat, we're going across the ocean, and it's like the exciting destination is the vision, the mission is why. The values is how we're gonna interact on the journey of going where we're going.

SPEAKER_00 1:34:02

I'm curious, with with mission, do you ever break or have you ever broken that out into like here's the external mission, right? Here's why we exist for our clients, which is obviously the most important thing.

SPEAKER_01 1:34:10

Well, I have a different framework, it's called the four purposes of our company. So, number one is to um get our clients results. Number two is to develop the team internally. Number three is to donate to charitable causes, and number four is profit, and profit enables all the other three. Yep. So, and what we do a really good job of because you know, like when you're in a sales and marketing type of business, I mean, we look, if we take somebody, we take in people from 5k a month to 800,000 a month, I mean, and multiple, you know, and obviously that's not a regular result, but still, I mean, that's like insane. And does that massively change their life and their family and their clients' lives because they're impacting more? Yeah, yeah, yeah, yeah. For whatever reason, though, it just doesn't translate as viscerally to like when I had that medical company, when somebody's like, oh my God, I can like not use walkers for the first time, even me saying that, you see how it feels different, which is weird. I mean, zero to eight hundred grand a month, I mean, that's a big difference. But you know, I say this person didn't have to use the walker. I I don't know why. Why does that there's something about that that emotionally feels different, and I think it's because it's more tangible.

SPEAKER_00 1:35:18

Yeah, I mean, zero to eight hundred grand, like that's a very vague, abstract concept, whereas that's concrete.

SPEAKER_01 1:35:23

Right. So that's the challenge. But one of the things I've done really well is, you know, there's a clear mission where I tell everybody I want them to look at this experience with our company as the most whether they go on and stay here for 20 years, they stay here for a year and go do something else. What do they do? They look back on their time here, and it was the most transformative time in their career.

SPEAKER_00 1:35:45

I love that.

SPEAKER_01 1:35:45

Like that's because that's how you know working at TF was for me. And I want to pass that along. And so that's very powerful as well.

SPEAKER_00 1:35:53

Yeah, I think mine is very similar. Like, my selfish, you know, uh, we we try and do a good job of communicating our vision as well. But like my selfish goal is that we grow at such a rate that no one on the team feels like they need to leave to get growth elsewhere, like they can, and that's totally fine. Wish them the best, but that we're growing at such a rate that no one feels like they need to move up.

SPEAKER_01 1:36:11

Yeah. And I think that's a for a lot of revenue stuff, it's easy because you know, we have like a vision and a mission and stuff. And I'm even thinking as I'm saying this, I'm like, ah, like, should I redo it? Does it need to be better? But do I want to change it again and seem decisive? But it just doesn't hit like when I had when we did the medical company, uh, I helped with uh, I mean, I largely really helped ideate the mission, vision, and values. And man, I came up with it so quick, and I was like, dude, this is the greatest thing I've ever heard because you know, it's healthcare and it's people's lives, and it's extending the time they get to have not just uh longevity but health span and all these things, and you feel it, you know, and with revenue, market, you know, you don't feel it as much because, like you're saying, it is uh abstract.

SPEAKER_00 1:36:58

It's an abstract concept. I think what we did, and I'm sure it's certainly not perfect, but which I think was a better approach that we've done a better job of is so we do uh have a philanthropic initiative as well, and we build homes in Mexico. And so this year we'll we'll be behind, I think, close to 100 homes built in Mexico.

SPEAKER_02 1:37:14

Oh, that's pretty cool.

SPEAKER_00 1:37:15

And so driving the focus to that and like the pictures of people who for the first time in their lives get the key to their house and have never lived in a house before in their lives, like that brings tangibility to all of the abstract numbers and KPIs.

SPEAKER_01 1:37:27

Yeah, I donate um personally to charity and I never even talked about it, which is probably not good. You should. It's like I might as well talk about it. You really should. But I have this thing where I'm like, I don't want to be the type of guy who talks about it, you know, because you know some people you're like, you know, there's some people, man, they donate so much to charity, and then they're like, they can't shut the fuck up. Yeah. And you're like, dude, like, like, look, I don't as long as you gave the money to charity, like, whatever. If it's about raising your own status, like, whatever, the money's still with people who need it and blah blah blah. But I'm like, Jesus Christ, like it's just like disgusting. And I I just the way I was raised, you know, even self-promotion for me, which I mean I've I've learned to do probably pretty effectively, but it it's not a natural thing for me. Like I came from the Midwest. Yeah. You know, it was shut the fuck up, put your head down, work hard. And also don't talk about money because no one has any. And don't talk about money, yeah. And so that's kind of how I grew up and stuff. And I've just never, I mean, I've donated like well under seven figures in the charity. I've just never even talked about it.

SPEAKER_00 1:38:24

It's the paradox of charity, right? It's it's like if like because to your point, if you give money to charity, you don't want to talk about it for those reasons. But if you don't talk about it, then there is a risk of an external perception being you're a selfish motherfucker who never donates to charity.

SPEAKER_01 1:38:37

And so that's a it's here I am laundering my reputation as we speak. I love it. There you go. Yeah. All right. Is there anything else we want to talk about there? That was good. Or you want to move on to your next thing.

SPEAKER_00 1:38:46

That was fantastic. Let's move on.

SPEAKER_01 1:38:48

What you got?

SPEAKER_00 1:38:48

Okay, so this is I'm I'm actually really curious to hear your take on this because this is a little bit of a counterintuitive approach that's worked really well for us when it comes to recruiting, and where we have had a significant amount of success hiring for more like operations, marketing, even some finance roles, is actually starting with someone who is a freelancer or like a solo agency owner, yeah, and then bringing them in-house that way. And so, like for a typical marketing person who's very talented at what they do, most people in those roles realize okay, I could make more money having three to five clients doing my thing than than working in-house, right? Yeah, I got a lot to say on this. Which is which is very true. And as someone who used to run that business model, your life sucks when you do that, right? And then you know this as well. And so what we've have probably close to like an 80% success rate doing with someone that we're really trying to recruit is if we know that we're hiring for a role and we found someone who's perfect for the role, but they're doing the agency freelancer thing, we'll bring them on board as part of a project, like a scoped project that allows us to do two things. Number one, it allows us to actually work with them and make sure that they're a culture fit and that they're as good as we think they are. But number two, it exposes them to our team. And we've got a pretty great culture, pretty dialed systems, like we've got things happening. Generally, the interaction of someone who comes in is oh wow, this this is this is different than typical clients that I work with. Right. And so at that point, and I make it well known to them, I'm just like, hey, my goal, because I used to be in your shoes, is to be your favorite client.

SPEAKER_02 1:40:22

Right.

SPEAKER_00 1:40:23

And like I think a mistake that a lot of people who hire outside consultants is is they just they just cook them, like they just abuse them. Yeah. And it's so short-sighted. And so, anyways, like, try and develop that that relationship, and I just start asking them on one-on-ones, like, hey, how's the business going? Anything I can do to support? How are the clients? Yeah, inevitably, they start complaining, pitching, yeah, bitching about clients. I'm like, dude, I I totally get it. I was there. And uh after a couple months, I just lay all cards on the table and I'm like, look, man, this is going really well. You're a great culture fit. It seems like we're having fun working together. Is there a world where we just have you come in full time? Yeah. And 80% of the time, there always is.

SPEAKER_01 1:41:01

Yeah, I call that the we're your biggest client strategy. So, you know, the thing is though, is, and I'll just be honest, you have to run a very good operation for this to work. And you guys do. I mean, that's why I wanted to talk with you about operations, is because you know, you guys genuinely run a good company. And I know that because I've known you for so long, and I just know how you guys operate and your thesis and all and all these things about how you run a company. And so it this doesn't work if you are not a breath of fresh air for that person. Right. You have to be the breath of fresh air. I I I pretty much do the same thing. I mean, I do it probably a little bit more directly than you, but I'm like, okay, maybe bring them on for a project. Then I'm like, hey, you know, how's these clients going? Oh, you know, it's blah, blah, blah, blah, blah. Let's be your biggest client. Right. And then a lot of times too, you know, it's like, I'm fine with them key, because with most people, like let's say it's a marketer, let's say it's email marketer, right? And you might want to bring them on for more stuff than just email. I think we outsource email and have a great experience, but um let's say they're doing a bunch of emails. You know, a lot of times what'll happen is 20% of those clients are like, they're like, dude, it takes me three hours a week, but then they're like, I fucking hate these other people. So I'm like, look, dude, just because the only thing is with some people like that, the pay expectation could be very high. Yep. And so you can build that into the comp plan long term, but I'm like, hey, why don't you keep your best two people? But can we get 80% of your time? And I used not to think that I'm like, you know, oh, it's 100% or nothing, but dude, with people who are really good, 80% of their time is better than 100% of somebody who sucks. So I'm just like, well, it's fine. And you know, and I'm willing to help them with their other thing too, or maybe send them referrals or whatever they need, you know. But that's kind of generally generally how I think as well.

SPEAKER_00 1:42:42

I I totally agree. And I think there's a real like some people just like there's a real like identity benefit to being able for them to say, like, I'm doing my own thing, and like the net effect of them having one or two other clients that don't take any time is that they actually give more to the business than if they felt quote unquote trapped being full time on your business. I totally agree. I agree.

SPEAKER_01 1:43:02

If you enjoyed this podcast, you're also probably gonna like this podcast I also did recently that you can check out by clicking the screen right here.