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CULTURE | Building Success in Life and Business w/ Lee Benson.
What if you could unlock the secrets to extraordinary value creation in your business and personal life? In our latest episode, we welcome Lee Benson, former CEO of Able Aerospace and the insightful author behind "Your Most Important Number." Journey with us as Lee shares his groundbreaking mind methodology, which has empowered him to transform Able Aerospace from a small team of three into a thriving enterprise of 500 employees, culminating in an impressive nine-figure exit. Lee opens up about the pivotal lessons learned on his entrepreneurial path, emphasizing the importance of strategic alignment and a deep understanding of your total addressable market.
We delve into the art of identifying the "most important number" for each team, a concept that has the power to align individuals around key objectives and drive meaningful performance improvements. Lee's strategies extend beyond the boardroom to the family dinner table, offering innovative approaches to value creation at home. Learn about the transformative "Dinner Table Method" and his vision for instilling these principles in a million families through the Gravy Stack initiative. From enhancing organizational success to nurturing the next generation's value creation superpowers, this episode is packed with actionable insights for leaders and parents alike.
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Business Owners Radio is a podcast that brings you insights, inspiration, and actionable advice from successful entrepreneurs and business experts. Hosted by Shye Gilad and Craig Moen, our show aims to help you grow your business and achieve your goals. Join us every week for new episodes packed with valuable tips and resources.
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And now Taking Care of Business, your hosts Craig Moen and Shai Gilad.
Speaker 2:Welcome to Business Owners Radio, episode 249. Our guest today is Lee Benson, former owner and CEO of Able Aerospace and author of the new book. Our Most Important Number Increase Collaboration, achieve your, your strategy and execute to win. Lee grew his company from three employees to 500 within 15 consecutive years of 20% compound average annual growth. Lee is also the CEO of Execute to Win, a firm that helps organizations of all sizes to accelerate the value they create.
Speaker 3:Good morning Lee. Welcome to Business Owners Radio.
Speaker 4:Good morning, cheyenne. Craig, it's so good to be here with you.
Speaker 3:Yeah, and we are very excited to have you here today. I know we were talking before the show and the three of us have so much in common, but I want to start with talking a little bit about your book, your Most Important Number. Tell us what inspired you to write this book.
Speaker 4:Yeah, thank you. The book, your Most Important Number. It outlines something I call the mind methodology, which is the most important number in drivers, and I've actually just started my eighth company from scratch last month. In total, over the years and my goal has always been how do we create value faster and get people more aligned and, you know, really go in that direction and what works. And I tried all kinds of forms of traditional goal setting and nothing I found really stood the test of time. So you know, fast forward a couple of decades.
Speaker 4:I developed this mind methodology and it's kind of cool how it fully aligns every single individual in the organization, every team member.
Speaker 4:It helps make way better decisions when you're aligned to this methodology and it drives a culture of accountability that I've really never seen anywhere else other than the clients that I work with to install this.
Speaker 4:So, in creating value over time, what really works, what's easy, what's intuitive, how do we get every team member to act like the CEO of their own role? And so great, this is working for me. And now I'm explaining it to other folks. And and now I'm explaining it to other folks and, like, probably both of you know, whatever we explain, maybe 10 or 20 percent gets retained and very little bit applied with the intent that it was meant to, and so that inspired me to write the book. I mean, let's get this down. And as soon as I wrote the book and got it out there, every company that does this, either on their own as a sort of a DIY, or uses us to help them with the implementation of the mind methodology they all read the book and everything goes faster. So it was really a necessary tool to explain this in depth and really you know, any leader top of the organization anywhere in the organization and even non-supervisory team members understand the concepts and go to the categories where they had questions and get some really good answers.
Speaker 3:You know I love hearing about this and I can't help thinking about you. Know, I feel like you're a pretty humble guy, and especially after founding now your eighth company. Let's not forget that this last company you founded, able Aerospace. You grew it from two employees to 502,000 customers in 60 countries before you exited in what was I think it's okay for me to say a nine-figure exit. So these weren't just like lemonade stands that you ran. I mean, you've built significant, significant businesses and of course we congratulate you on that, and I can only imagine all of the incredible things that you've learned, that you've been able to apply to this book and now your next venture.
Speaker 3:But before we quite go there, I have to ask you, looking back over your shoulder, when you think through these different businesses that you've built and the lessons learned along the way. I'm sure some exits went better than others, right, and there were some businesses that created more value than others. What do you notice about that? Are there things that jump out to you? Were there types of businesses that you're like, wow, if I only knew then what I know now, I would have wound that down sooner, or I would have shifted gears sooner, because there was sort of limitations to either the market or the customers that you were playing in.
Speaker 4:Yeah, that is such a big question that you just asked and I kind of chuckled because we're looking today at my 40 plus year overnight success story, right. So all of this is an evolution to get here and there's all kinds of things that I've figured out over the years and that's what led of things that I figured out over the years and that's what led to developing what I'm calling this mind methodology. But when I go back, if I look at the company that I assume for its debt in 93, for $600,000 in total debt, the market that we had, so I look at a dressful market. We were the biggest job shop doing this specialized kind of electroplating in the country and our best year ever was a million dollars in sales and it was mostly through one customer and when we lost that customer overnight, you know they were 90% of our business. We went down to two employees and I was able to buy that company for its debt and then grow it into what you talked about. But it wasn't even that company. It was a springboard into a number of other things that led to it and the total addressable market was so small for the specialized electroplating that a couple of years later, in 95, I started Able Engineering, which that was the one that grew, probably the biggest.
Speaker 4:There was another company called Able Aerospace. I started in 99. And when I packaged the two of those and sold it to Textron in 2016, they just adopted the name as they both rolled up into one, able Aerospace, and the addressable market was so much bigger, getting into the aviation aftermarket. So, looking at where we started with that one business, which was Able Metallic Services, by the way, sold that in 2002. And the address of market, so small, just didn't make sense. But when we got into the aviation aftermarket, you look at all of the maintenance done on large fixed wing aircraft. You know the people, movers, package movers of the world and all of the larger commercial helicopter operators, emergency medical transportation out to oil rigs, etc. Now we're into a stressful market that's tens of billions of dollars.
Speaker 4:So I think that's really one of the big things when you start out. What's the idea? You know where you're going. How are you going to solve it in a way that's better than the incumbents that are out there solving for it today? And what's the addressable market? And, really important, what's the business model? How does the math actually make sense as you go through it. So really thinking through all of that up front and really at any point in time to polish and continually improve, regardless of the stage that the business is at, because as you grow you have more and more products and or services really, really important. I think a lot of folks miss that. Does that make sense?
Speaker 3:Oh yeah, I mean, it makes perfect sense. It's interesting just thinking about the beginnings of that electroplating business, right? So the first warning sign is 90% of the business is with one customer. So, man, what a huge ball of risk you're carrying. And then the limitations of the marketplace.
Speaker 3:Course we're talking to business owners like ourselves and other experts all of the time, and some of the most difficult conversations that we've had with business owners is trying to get them to articulate and think about where it is they want to go, what is the number that they're trying to get to? And really taking a look at the business they're in and the available market and the competitive landscape and what was your best year? And then let's talk about profit margin what would it have to look like for you to get to that place? And often the answer is this vehicle might not be the vehicle to get you to where you really want to be, to really get to the kind of numbers you really want to earn. This vehicle that you have right now might be keeping you from that, and sometimes the best solution is to exit and, if that's really what you want, move towards something that can bring you that thing.
Speaker 4:Yeah, 100%. And what we want to have happen may not match with what the market is seeing or how they're receiving the value that you're creating. And then does the math even add up Like, will this even work? And I see a lot that just seem to run at a strategy of well, if we just work harder and harder, this will eventually work out. Let's really pay attention to what the market's saying and let's make sure that the business model really works in terms of what makes sense.
Speaker 4:And as you figure out more and more things, I do agree that it's virtually never a steady rise in terms of profitability and success of a business. It really is a series of plateaus. You figure something out, you take a big jump and then it's wild how the expenses will almost always catch up to that new level of business, no doubt, yeah right. And then you take another jump and so you keep doing it. So the goal is is how do we take more frequent jumps and really keep an eye on doing more with less so the expenses don't keep jumping up to? You know, match the the new revenue and profits to take it away?
Speaker 2:lee focusing on this element of the most important number and it's part of your mind strategy and we'll dive into that more. I was curious in aligning what's the most important number from your perspective, how do entrepreneurs and business leaders identify theirs?
Speaker 4:the top of any organization and I actually work with a lot of in my team, a lot of for-profit and a lot of nonprofit organizations. But in the for-profit world, what's the one number that's reflective of the valuation of your business or the value of your business, and a lot of times it's EBITDA. You know it could be cash flow, you know it could be revenue in some cases where you get a multiple of that when you exit. But there is one number that's used to calculate that primarily, and so a most important number will do two things One is reflective of the value that the team is designed to create and if it's a senior team it's the overall organization and two, it will drive the majority of the right behaviors. So there could be one number let's just call it profit and you might measure 5, 10, 15, maybe 50 other things. But all those other measures, you're only measuring them to help you make better decisions, to improve the value that your team's creating, or your most important number. And if you can't answer the question of how these additional measures are helping with that, then probably should stop measuring it, because it's just checking a box or an activity. So imagine this most important number at the top of the organization and then every function sales, marketing, operations, hr, finance depending on the size of your business, there are going to be lots of different functions and, obviously, type of business. They also will have a most important number that does those two things.
Speaker 4:How was the team designed to create value? What a most important number that does those two things. How was the team designed to create value? What's the one number that's reflective of that? What are the additional numbers that you're looking at to make better decisions, to improve that number? When it is improved, it'll improve the next one up and all of these teams that come up.
Speaker 4:The most important number it's also your plan. It's where did you start? Where are you going At any point in time? Are you on track or not? And think about this You've got the top number, you've got the primary functions and then, as the organization gets larger and larger, every single team has a most important number that, when improved, will improve the next one up. It all creeps to the top. It's such a simple, elegant way to align everyone in the organization to create the value that it was designed to create.
Speaker 4:Obviously, very important for the senior team to articulate that and make sure the business model is right and everybody aligns to that. Because we're not aligned at the top, what are we cascading out to the front lines? So once I know that number for every team and where they're at, what's the next thing I want to know? I want to know what's the best work they're doing to improve that number. So I look into their meetings, I look at the drivers or these categories of work. They should be good at leveraging to improve their most important number and I'm curious about their culture of accountability.
Speaker 4:But it's really that simple. How do I know you're winning or losing? I've got this number to look at and now show me the best work that you're doing to improve that number as a team. And that encompasses the mind methodology. It's super comprehensive, it's incredibly holistic, but it's simple and straightforward and includes all the things that you could possibly think of from you know succession planning, backup planning, compensation, team member development. You know everything is in here, but the simplicity of how you look at it and know where to focus in the organization I haven't seen anything better out there. That's why I developed it over the years.
Speaker 2:It is a nice operating system and to be able to simply put together a process of understanding the organization, understanding their goals and vision and then implementation. Can you walk us through maybe an example of a client in the past Don't use names, of course but how this may be implemented and what's kind of initial results and some stories there, if you could?
Speaker 4:Yeah, there are a lot of stories. When we start with a client, let's say when we're actively involved in helping them implement this, we meet with the senior team. I like to get philosophical agreement on why they're there, which I would say the CEO's job is to continually increase the value of the organization over time, responsibly, Right, Best net result over time. And then, by proxy, the senior leadership team. Their job is to do that as well, to continually increase the value of the organization. And maybe you're surprised, maybe you're not, but I've yet to be in a room where they all say yes, immediately, of course it's okay. Well, yeah, yeah, yeah, we should do that so great. So now we have that. Um, now how are we designed to create value? And so we'll start there. We get full alignment at the top and then we start creating.
Speaker 4:You know the same conditions in this mind methodology for the functions in the organization. You know HR, for example, and I talk about this in the book usually when I ask them out of the gate what do you think your most important number should be? That will reflect the value you're creating and drive the majority of the right behaviors. All of these most important numbers, by the way have to be collaboratively developed. It can't be here, it is, we're giving it to you. They need to own it Right. So we all need to work on this together. But HR typically says, well, retention should be it. I said, okay, well, let's test it. You hire me to run HR. We're three years down the road. I've kept 95% of our people, so I've knocked it out of the park. On retention, Nobody's ever done better than this, Nevermind that 80% of our folks can't deliver on the outcomes that their roles require them to. I kept everybody, so that did not really drive the majority of the right behaviors at all right behaviors at all.
Speaker 4:So a most important number for HR that I like is percentage of seats filled with capable people. And what's a capable person? Well, we've got a role that they filled. There are three max outcome-based responsibilities maybe four occasionally, but usually it's around two that they're held accountable to and we're measuring that they're doing it or they're not. There's a list of capabilities that they need to have to have a good shot at achieving the outcomes and maybe a list of duties that are just administrative things they have to do. So those that are hitting or overdriving over delivering on their outcomes for the role they're capable in that seat. And then as you move up the organization, somebody that isn't capable in a role, as they become more of a senior leader, can have a much bigger impact on the organization. You know up or down right. And so now we're driving all the right behaviors. We're recruiting better, we're onboarding better, we're training better, we're giving leaders better tools to develop their people. Now I've got something there and so it's the right number and it's driving the majority of the right behaviors.
Speaker 4:I can go through the same examples around finance that function in the organization. You know sales, marketing, you know operations, all of it and the stories typically. You know there are two buckets here that I look at that come in. There's folks around the world that read the book and they just change the language a little bit to, hey, what's your most important number, what's the best work you're doing to improve it? And I'm getting a common story back that says gosh, within the first six months we've doubled our desired results around profitability or revenue. It's such a simple thing. And then the other bucket are the clients that are intentionally doing this with our help. And same thing, Gosh, I've got one in the virtual assistant space.
Speaker 4:When I got involved with them, I think they had 67 virtual assistants placed, primarily in the Philippines, into virtual roles in the United States. Fast forward, gosh, it would be 30 months and they had 1,600 placed. They went from evaluation of probably $100,000 to evaluation of $48.6 million. That's pretty incredible. That's a huge success story. But I've got a number like that. Once you get fully aligned to the value you're designed to create, you're looking at the important things the business model, the culture, the structure designed to create. You're looking at the important things the business model, the culture, the structure and you're a lot more intentional about those things.
Speaker 3:It's no surprise that the results just jump. It sounds so simple when you put it like that, Lee, and of course that's an incredible success story. We know you've had so many stories like this. What is the problem? Why is this so hard for most people to sort of unlock and figure out on your own?
Speaker 4:One of my mantras is do less better, and I feel like a lot of leaders, for whatever reason and we could talk about that probably for a while it's like let's do more mediocre with, and it's from startup to the largest that I've directly worked with. In the $60 billion market cap range, there's rarely more than four things that drive 80% or more of the value for the entire organization, and I like to sort of tease out what are those three, four things, sometimes five, and how well are we doing those things today? And if it's not an eight or nine out of 10 in how well we're doing it, let's double down there and really make sure we're doing that well before we decide to do something else. And I know it's interesting and it's intellectually stimulating maybe to talk about a bunch of stuff. It's kind of the reason I think people love having strategy sessions and talking about things, but 97% of it's going to be executing and they don't seem to enjoy that nearly as much. So let's figure out the four things-ish that are driving 80% of the value and when we're doing those as well as we possibly can we add something else, and I think that's the main reason.
Speaker 4:Last year, one of my teammates and I worked with the largest so far $60 billion market cap client and we went from over 100 strategic initiatives down to hey, maybe there's about 15 that fit into these four buckets of the four things that create over 80% of the value for the organization. And the nice thing about scale when you have something so big like that, is a very small incremental improvement can generate a lot, and then the downside is you make a mistake. It can also lose you a lot. But I would say in the first year it was kind of hard to calculate, but the consensus is we think we created $200 million in additional positive cash flow because of focusing on the four and taking all those initiatives down to a much smaller set that fit into the four.
Speaker 2:You know I'm going to go off track here a little bit because it caught my eye and I thought you know this has value. You're continuously adding value to the community and you have two bestsellers on Wall Street Journal bestseller list and this being one, the other one can we touch on for just a second. It's called Value Creation Kit and for all of us parents out there, this one really has potential also. So simultaneously you've got two different fields that have some similarities. Can you draw some correlations to the MIND program and how this applies into the value creation kit?
Speaker 4:Yeah, the first book is really about operationalizing value creation within an organization of any type or size doesn't matter and I spoke last summer to 800 leaders from the state of Vermont about this and they love all the concepts there and they're applying them and I'm regularly checking in. So any applies to any organization again, any type or size. And now I'm looking at the education system and how the results overall on average in the United States are going down for our kids and down for adults, really around financial competency et cetera. So I wanted to figure out a way to operationalize value creation within families and I love this concept of holistic value creation. For me it's the complete answer. It's sort of how I formulated value creation into three buckets Nothing new, but I think the framework and the way I'm describing it is new and how it's packaged.
Speaker 4:But there's material value creation, emotional energy value creation and spiritual value creation. Material we all know money, things that we accumulate, and I think it's important to cultivate our ability to do that at a minimum to maintain the lifestyle that we want. The emotional energy value creation bucket in organizations it's the X factor for leaders, in my opinion. I also think it's the scarcest commodity on the planet. I'd rather live a life half as long on nine or ten, with emotional energy out of ten, than one or two, so much more fulfilled. And then the spiritual value creation bucket. It's all about connectedness and that means something different to everyone, like how well are you connected to yourself, to your family, your friends, your community, the universe, a higher power, whatever that is for you? But I think that's one of the biggest issues we have right now in the world is we're lacking connection and places to go for wisdom and all that.
Speaker 4:So in Value Creation Kid, the book the Healthy Struggles your Children Need to Succeed, I outline a methodology. We call it in the book. Today it's called the gravy stack method, but we're changing the name to the dinner table method, because a dinner table really is the place where value creation conversations happen and there's four pieces to it. It's wildly simple. How do you talk about value creation? You got these three buckets. How do you help kids find their value creation superpower so they can cultivate that and just have these amazing lives that they build for themselves well into adulthood, to house rules. So what are the expectations? How do you earn extra money? What are the expenses you pick up over time as you get older. Three financial competency. And four healthy struggle Getting parents and kids to really value struggle.
Speaker 4:We only develop when we stress ourselves a little bit. There's healthy struggles. Sometimes, unfortunately, there's unhealthy struggles. However, all of them can be leveraged to create more value in the world and I find it fascinating that there seems to be this push to remove all struggle from everybody kids, adults and all of it.
Speaker 4:Well, no wonder that we're losing our collective capability to really deliver results or create value in the world. I can't think of anything where you don't have to put some effort in to build a capability and that's you know. It could be a micro struggle, it could be something significant. But if what the world is trying to do today made sense and it really worked, that would mean the less I go to the gym, the stronger and more flexible I would be, admitted like. Literally, it makes no sense.
Speaker 4:So the reason I wrote the book with my co author is to operationalize value creation within families, and I've actually just taken over as interim CEO of this company called Gravy Stack, which we're changing the name to Dinner Table here at the end of this month, and we're out in 4,000, 5,000 families today with this methodology and my goal over the next three years is to get it into a million families and we're spreading this through licensees that are coming on board to facilitate communities of parents to help them go on this value creation journey with their kids, to stack on that wisdom and keep building on it over time. And right now there's very few places that parents can go to benefit from this collective wisdom to help them go even faster on raising their value creation kids, and I think it really helps the parents too a lot.
Speaker 2:I'm sure our audience by now realizes that on an energy level, lee operates at about 11 or 12 throughout his life. He's fun to listen to, fun to be around and there's so much volume there on things that he's working on. So we really appreciate your feeding us so much information, so much insight and, as we do, we highly recommend these two books because there's so much depth and content. And then you follow on with your information. We highly recommend these two books because there's so much depth and content. And then you follow on with your information of organizations you're setting up and actual dialogues and speeches. How does one interact with your organization, a business owner? How do they become more involved?
Speaker 4:Yeah, thank you. If you want to learn about, you know, increasing your capabilities to create value in a business or an organization of any type or size, please go to etwcom and you can see all the resources that we have there. We help organizations DIY the mind methodology. You can get pointed to the book there, but you can also find the book and you know 40,000 channels wherever you can find books. There's an audio book as well.
Speaker 4:If you consume that way and in that website you'll see something called Execute Masterminds and it's a CEO mastermind group that is different than all the others that have been part of masterminds with overlap for over 40 years out there and they lose their evergreen value over time because they're really focused on process and the groups can be, you know, quite large, so it's hard to get to everyone. In our format it's designed to have evergreen value. Where you know so much about each other's business, you're getting over 80% of their brainpower and wisdom in every single meeting. We limit the size to eight. A full group is six to eight and every two months you're getting a deep dive on your business and the thinking in the room in these meetings is that, metaphorically, we've all invested half of our retirement money in this conglomerate and we want to make sure that we get a really good return in our retirement so we can lead the lifestyle we want.
Speaker 4:So what do we want to know? What do we want to see? What risks are being uncovered that we need to find, and what I'm seeing there. Like last year with the groups that I run, I've got three full groups I'll probably start another one this year just for me and we have a number of chairs that have their groups as well that have been certified in this process. The lowest performer was 38% growth in the value of their business, and the highest was 1,100% last year. Super proud of all of them. But it's this what I'm calling full contact value creation, experience in the room that causes this to happen. So you can learn about that on the website as well, and if you're interested in any of this, just reach out. It's pretty easy there.
Speaker 2:Well, shai, I think this is a fantastic episode. I wanted to make sure, lee, also, that we covered every content piece that you wanted in. I think it's been amazing, and is there anything else we might have missed?
Speaker 4:Yeah, thank you. For any of the listeners that are interested in what we're doing with Value Creation, kid the book and how we're helping families create more value as a family and raise kids, that will be amazing value creating adults in the world. Go to dinnertablecom to learn more about that and we can connect you with resources there as well.
Speaker 3:Well, Lee, it's been incredible getting to talk with you today. We want to thank you again for joining us.
Speaker 4:It's been so great to be here. Thanks so much for having me.
Speaker 3:Is there anything else you'd like to leave with our listeners?
Speaker 4:Yeah, for the listeners. If you go to the etwcom website, we have lots of free resources that we just give to the world around the mind methodology. My mission here is to drive holistic value creation out into the world through organizations, and we want everybody to do it, whether you're a DIY or you have us help you with it. Lots of free resources there, and if you go to dinnertablecom, you can learn more about what we're doing to operationalize value creation within families and you may want to join one of our communities. We have a free community. We have lots of amazing content, conversations, paid communities or you may want to be a licensee where you can guide these conversations with communities of families on your own. So you can learn a lot there at dinnertablecom.
Speaker 2:Our guest today has been Lee Benson, former owner and CEO of Able Airspace and author of the new book your Most Important Number Increase Collaboration, achieve your Strategy and Execute to Win. You can learn more about Lee, as well as find links to his resources and book, on our website at businessownersradiocom.
Speaker 1:Thank you for joining us on Business Owners Radio. We hope you enjoyed today's show. As always, you can read more about each episode, along with links and offers, in the show notes on our website, businessownersradiocom. We want to hear your feedback. Please leave comments on this show or suggestions for upcoming episodes. Tell your fellow business owners about the show and, of course, you would love the stars and comments on itunes. Till next time, keep taking care of business. You.
