There are people that are working hard every day and every week but they’re technically sitting, as Jim Collins says, on the wrong seat on the bus. In this episode, Ken and Kerri look at a couple of things they’ve done in the last ten years that are hurting and slowing down their growth. Kerri also sheds some light on how 20-person, 100-person, and 300-person plus companies can avoid making bad decisions.
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Thoughts From A Master
We’re in the middle of a three-part series of sponging the brain of the Kerri Courtright machine. Kerri is my wife, my life partner of 30 plus years. We met 31 years ago actually in college at that fateful day when she walked into the class I was sitting in and the rest is history. On the last episode, we went into the pretty exciting but daunting news that we’re going back to school. We are going to get our Executive MBAs. We attempted to explain why and we explained why it might be a good idea for somebody in your company to consider doing the same thing based on what we know so far. We are going to continue the interview with Kerri. What I am curious to know is what my wife thinks on a couple few questions, but to set the table for some of the newer audience to this podcast.
We own a company 150 to 200 employees. We’re at about ten employees a month. We’re growing fairly aggressively, to say the least. Kerri and I want to advance ourselves both intellectually, but much more importantly, systematically by learning what companies at the $200 million mark and bigger are doing. We’re going to go back to school and see if we can get some insight there. Here’s a direct question to Kerri. With the concept that we manage other people’s websites, if we do a good job, which we do, 99% of the time we share in the revenue. If sites fail, our company has to dig into our piggy bank and buy that person another website, making them as much money or more as the one before. Out of 800 plus attempts, we’ve had to do this almost 50 times.
We do get about a 1 out of 50 failure rate, 2% or less. Here’s the direct question. What are a couple of things we’ve done in the last ten years or that we are doing that hurt us and slow down our growth? Even though we double every single year. There are things that you and I laugh about all the time. We can’t believe we still allow it to happen and maybe going to get our Executive MBA might shed some light on how to maybe correct some of these things. Are there a one or two things we’re doing that the audience might also be doing in their company that you could shed some light on things we’re attempting to change either quickly or slowly? Did anything jump out at you?
I don’t know if the MBA’s necessarily going to change it. We have people in the wrong seats on the bus.
Give an idea of why do we have people that are working hard every day, every week, but they’re technically sitting, as Jim Collins says, on the wrong seat on the bus. Why are they on the bus to begin with?
We’re growing so fast, so we need the bodies. We need bodies and they are doing well. They’re just not happy in their position or we let some things slide and ultimately through the repercussions, it’s like a ripple. You throw a little pebble in the water and the first ripple is little and they get bigger and bigger and as it grows. We’re still doing that, unfortunately. We are, however, in the process of correcting it, which is great. The coolest thing is we talked to other business owners that are friends of ours have grown with us, our suppliers for example. It’s cool bouncing off ideas. That part is what I’m looking forward to in terms of the EMBA is bouncing off ideas. This is not the first company that’s actually had someone in the wrong position for way too long.
How do they recognize it? It’s not just recognizing it, it’s figuring out a way, a system to stop it. For example, our friends, what they did, they have an office in London, an office in New York. They decided that they would hire one person who is not HR, one person who has a finance degree. They understand the importance of having someone knowing their job and recognizing when someone does. It’s following the task from beginning to end. Her job is literally to write the job descriptions, manage the people, make sure that they are productive, not making sure they have the vacation time off. That’s HR. She’s making sure that the right person is in the right seat, being effective, doing the hours that they need to do effectively and efficiently.
That’s only going to come. I only found that out that was a great idea because we already have an office manager. It’s something above an office manager in terms of production, capabilities and recognizing that what we might need. Our employees come to us and say, “We need two people in this department.” How do I know? I don’t know for a fact that we need two people there because Ken and I are in Illinois. They’re there and we trust our staff. Don’t get me wrong, we love our staff. They’re very efficient, but they only know what they know and most of what they know is from us. They’re looking for people to get the job done. Being around with our association, we found that often people sometimes do the same job differently. They come at the task. Like a tootsie roll, there are two ends of the wrapper. One on each end, some people do the same job from a different angle. It gets done, but it gets done twice. It’s redundant. That’s one of the things we were looking for in terms of going to the MBA.
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That’s perfect. For clarification, for the newer entrepreneur, both Kerri and I just quoted Jim Collins’ book, Good to Great. The concept is in 2001, Jim Collins looked at the greatest companies of all time and wrote what is now one of the top ten bestselling business books of all time, Good to Great. Right in there in chapter two, he talks about the single most important aspect to a growing company is when you see a great talent out there, you put them on the bus, even if you don’t have the perfect seat for them, you never let talent go. You have to put someone that is solely in charge of finding the right seat for that person on the bus.
That’s where Kerri and I were so busy growing. We often forget. We put quality people on the bus, but they’re still sitting in the front of on the right side, in the second seat when they need to be in the back of the seventh seat in the left side. It’s just one of those things. For those of you out there that are love reading, great business books, one of the best of all time is Good to Great. It’s a good little recommendation there. I’m going to flip the question on Kerri. What’s one or two things that we’re doing or done that hurt our growth? What are one or two things we do well that allows us to grow as we do?
Our company’s excellent at pivoting when we recognize something is not working. We do a lot of beta testing. We have websites, we beta test for our own company. We figure out what works and what’s not working. If it’s not working, we stop it. We move into another direction. We also have outside people that come in to help us. If we recognize, for example, like hypothetically let’s just say your graphic design department isn’t doing exactly what they need to do, they’re 90 points, they’re on 100 points. We’ll hire someone to come in, check it out, see what’s going on, then show our people where the latest and greatest ideas are coming from, what they should be looking at, what’s more effective? Those people are gone, so then our graphic design department again is up to 100% and 110% but we do that with every department. I have to say something I’m excited about our company. Most companies can’t do that, they don’t recognize it or they’re fearful. That is something we take pride in.
I always look at companies in three different sizes though. The one to the twenty-person company, the twenty to 200 and then the 200 plus. For the sake of this conversation, small, medium and large. That’s not technically the SBA’s business definition, but it’s Ken’s. One to twenty, twenty to 200 and 200 plus, starting with the small one, because those are totally different animals. We used to be one to twenty. We’re right at the 200 mark and pretty soon for the rest of our lives, we’re at the 200 plus. What is a piece of advice you can give the entrepreneur owner decision maker in the one to 21st that could help them avoid making bad decisions?
First of all, find someone that will work with you to be your right-hand person. If it is your spouse, utilize your spouse. There’s nothing like having your spouse work with you because your spouse has a vested interest like you do in making sure the bills are paid. Your spouse can be your biggest ally. Even if you’re a guy and your wife is a stay at home mom, don’t underestimate her. Use her because she’s probably waiting to be used. She’d probably be as excited about having an adult conversation and we’ll give you everything she can. First of all, it’s finding someone to be with you along the way along the journey. The second thing is once you have that person with you, delegate, make sure that each person knows their roles, responsibilities. The worst is when, “I thought you were going to do this. I thought you were going to do that,” then something gets dropped. That could be something extremely important like paying your company car and the car gets repossessed. Something so simple as that can happen. It probably has happened numerous times.
Then the other thing is finding out what you do best. When you’re doing your roles, responsibilities, as soon as you have a couple of bucks or even before you have a lot of extra bucks, start finding people who can do things that you don’t have to do anymore. An accountant is an amazing person. Most people have accountants for their personal. Find an accountant who is looking for a business just like you are. If you’re a sign company, you can do signs for them and they can do your accounting. A lot of companies give you a reward when you lead people to them. When you’re out and about selling your product or your service, you can drop that name, it builds up and you don’t have to pay for that service at the accountant’s office. Find ways to make sure you utilize your time most efficiently to let you grow. If you’re stuck in the day to day, like stirring the pot, if you’re part of that mixture and just going round and round in a circle like hands on a wheel, it’s not going to serve anyone, let alone your employees, let alone your customers.
Let’s shift it to a hundred-person company. The person at the top or the couple at the top, they have admins, accountants and a legal team. You’re at a hundred person and growing. What advice do you give them to avoid making bad decisions?
Find someone to be your consultant for you as a company. We have someone that we work with that we bounce ideas off of who has helped other companies. We hire people to come in to do whatever it happens to be. The graphic design department is something I utilize, whether that or SEO. We have a company out in Romania and our gentleman who does SEO, who is one of our consultants, went to the Romanian office and the results are amazing. If you get an extra few bucks, find someone to help do that. I love using LeapFrog. You’re not going from one step to the next step like you’re a little Apple watch telling you how many steps he did that day. You’re looking to be the jolly green giant and taking 5,000 steps at a time, leaps and bounds. How you are going to do that is by having someone guide you who’s already done it.
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You’re now what I’m going to say a 300 person company. There’s a board of directors. The CEOs got as many little consulting groups as we have. What could we tell that company that could help them not only the people at the top but that top level of management? What could maybe they do that would help them avoid bad decisions?
I want to go back to Pepperdine. That’s one of the books you’re reading, which is something I think we’re pretty good at. That is listening to the people at all levels. Either the people in your front line are the ones actually know what’s going on, they’re the ones that feel it. They’re the ones that see if the equipment is not working. You’re making glass, if there’s chipping at a corner, you used to have maybe one glass per thousand be chipped and all of a sudden you’ve got 100 out of a thousand being chipped. They are the ones that see why. You don’t want to wait for a week or two weeks later to figure out why you’re losing so much product and losing revenue. Those are the people you need to actually listen to us. You need to figure out the form of communication.
In our company, we have this thing called the five by fifteen, which is cool. It’s the people at every level. It goes from the bottom up to the top, all on Friday. You’d no more than fifteen minutes at that Friday are you allowed to spend. One level does what happens with what’s been working, what’s not working, what’s a concern, what’s a future need? That’s all it is. It goes up to their supervisors. There are about ten people to the one person. In that level, they do the same thing. They read everybody. It takes about fifteen minutes. Then they put their five minutes together and compile it.
They bring it up and then to the next level, until Ken and I get full reports every single week of what’s happening in the company, what her needs be consolidated needs. We are very well aware of what every level needs. You can’t change something that you don’t know is going on. No matter how big you are, you have to have a way of getting communication. I can’t stress it enough. People talk about your house. If your bills are too high, you’re not going to have a house. The United States of America as a whole is still going to keep on churning. It’s what happens at the very base level that is extremely important. That’s your foundation. You need to know what’s going on.
Something Kerri said was so profound that I have to repeat it. There’s no misunderstanding. We’re, we’re a 200-person company and every Friday, everybody, the people that do the meaningful work stop their day for fifteen minutes. They write out what went well this week, what challenges do they have this week, what obstacles are currently in their way for improvement? Is there any need request, question, concern? Whatever they can write down in fifteen minutes or less and they email that to their superior. That level of management reads them all. They then consolidate the thoughts of their team and they write a five by fifteen of what’s going great, what’s not so great? What are the current needs demands and obstacles?
That goes up. By the time it gets to Kerri and me, every single week, we have in real time polls of current obstacles, current challenges, current victories. Think about this for a minute. Kerri knows every Friday a couple of different people on the team that deserves some praise. Some people on the team may deserve a kick in the fanny, but also, what systems are working. You know the squeaky wheel gets greased. When those five by fifteens come up and week after week, there’s a machine that’s grinding. Meaning there’s a division of people that are turning at the teeth. That’s profound what Kerri said for the 200-person company. You go to the base level and you listened to what your people are telling you. That was the tip. I hope this helps. Take care.