Episode Transcript
[00:00:00] Speaker A: Welcome to the Independence by Design podcast where we discuss what it means to be a business owner and ways to get unstuck from the day to day so we can design a business that gives us a life of independence.
So, David, I'm really excited for this conversation because not only did you guys have that 2016 and then the journey to. Then the 2021 sale. 23. Is it 23. Okay. I met Tom. I met Tom in 2021.
[00:00:31] Speaker B: Yeah, that's right.
[00:00:32] Speaker A: Okay.
You have created something called management mastery that I'm really excited to learn more about. I have been hearing from you in the group different stories about how you've built, you know, like what. Like the results and how you were interacting with people inside of Natech.
And the reason I'm excited for this is because I have struggled trying to grab on to, like, leadership systems and stuff like that. There's so much fuzziness around management leadership. How do you quantify it? Is, you know, Bob or Sally or Joe good or not good without it being subjective?
And so I want. I've got a lot of questions because I went through your deck and I'm really excited to hear the whole story arc of, like, the inception all the way to, like, the results that you were getting and how it works.
Before we jump in to that, I wanted to know what your.
How you differentiate leadership versus management?
[00:01:34] Speaker B: Yeah, you know, that's. That's interesting. I've had multiple people ask me that question, and I've read articles about it, and my answer is, I. I don't differentiate between the two.
I. I don't think you have management without leadership.
I think leadership is super important as a part. As a fundamental part of management, and kind of vice versa, too.
So my background, my initial introduction into management was actually through project management.
So I got my PMP certification from the Project Management Institute. And I learned quite a bit from their approach, which I think is a really nice one. I think it's really beautiful how every project is different, but there is a process still that you can use to go through and increase your chances of success at the end of the day. And there's so much leadership. And there was a lot of talk about the importance of leadership within the project management side of it.
Then the approach that I took is a broader look at management or approach to the general skills of a manager across fields, across industries.
[00:03:10] Speaker A: Why do you think people try to separate management leadership?
[00:03:17] Speaker B: I don't know.
I mean, I think.
I think there's like, certain images of who is this person?
Like they try to pigeonhole.
One of the things I remember reading was, you know, managers sort of follow the way things are, whereas leaders look at, oh, what, what more can we do? How do I build up my people?
I think it's, it's a little bit more just trying to pigeonhole like certain types of people.
[00:03:56] Speaker A: Like stereotyping. It's just like a way of profiling in order to like make sense of things.
[00:04:01] Speaker B: Yeah, probably like, oh, what? There's the difference between a boss and a manager and a leader and trying to define it that way. But yeah, so I think that's really
[00:04:13] Speaker A: helpful because I, I mean, I think it's like when I, when I, up until this conversation, like, what I was coming at it from was probably very much the heuristics and stereotypes of like, okay, manager is essentially the people getting fired because of AI.
And like, I just picture, I, I mean I'm just picturing a bunch of dead weight people.
And then the leader is the one that's like, I've got one of the owners in our community where he's got this picture behind him where there's the leader and he's at the front or the person's at the front and everybody, he's like pulling everything forward.
[00:04:46] Speaker B: Yeah.
[00:04:47] Speaker A: And so I think it's more like just these different weird, you know, interesting ways of like servant leadership versus managerial class that's like this, I don't know, helpful for this conversation because I also think it's easier for us to continue then because like, I think about like if you're a captain of a sports team, you can be, I mean, so you, does someone have a captain? Is someone a captain without deserving it from a leadership perspective? I mean, maybe, but I feel like that's almost kind of what you're saying. It's like, well, it's kind of, they're kind of intertwined together.
[00:05:19] Speaker B: Yeah. And I think part of it is like trying to, I guess make sense of the emotions. Like the idea of a leader being inspiring and a manager, like micromanaging you.
[00:05:32] Speaker A: Right, right.
[00:05:34] Speaker B: So I think a little bit of that is just trying to make sense of things that are actually at face value, kind of messy.
[00:05:44] Speaker A: Right.
[00:05:45] Speaker B: Yeah. Not necessarily. Like, how do you make logic out of something that's very emotional and people, you feel it and you can't necessarily articulate what's going on or why.
[00:05:59] Speaker A: Which is why I think it's going to be fun to unpack management mastery. Because I feel like you have put some edges around the fuzzy people. Part you and I have talked a lot about in ibd, like, the functions and the roles and stuff like that that I've decided to tackle, which is different than the people part of, like, how do we actually train up culture and quantify culture, quantify, you know, competence. And I'm excited to unpack because I feel like you've got something that we can grab onto instead of, like, swimming around on the deep end trying to grab an edge. I think that's, like, what I've gathered from your materials. Like, okay, here's something that we can use to discuss to quantify instead of just having mission, mission, vision, values on the break room wall. Like, we're actually.
And then, you know, there's personality profiles that people are using constantly to use different ways of grabbing onto it. But you've kind of got structure to it. And I'm curious, as you like, let's talk about the inception behind this. So it started in project management. What. What was the problem that you decided or what was the problem that you saw that you were trying to fill?
[00:07:09] Speaker B: Oh, wow, that's.
That's a fantastic question. So, well, we'll go back in. In time a little bit.
[00:07:17] Speaker A: Yeah, I'd love to.
[00:07:19] Speaker B: My background, my. My goal when I was leaving high school was I wanted to be an actor.
No way. Yeah.
I applied to two schools. I applied to.
I loved writing also. So at the time, I was also trying to write a novel.
And I thought, okay, I'm going to apply to an acting school in New York City, and I'm going to apply to USC for writing in Los Angeles.
And I got accepted in both, but I kind of thought, oh, I think the writing would not help the acting, but I think the acting would help the writing.
So I went the acting group, and for years, I was a starving artist in New York City. No way.
[00:08:09] Speaker A: I have not known this since I met you. That is fantastic.
Oh, my gosh.
[00:08:15] Speaker B: I learned a lot about that. That I call my, like, I call it kind of two years of. Of therapy is like, going through acting and just being comfortable with. With emotions and intensity of emotion, being able to, you know, let. Let emotions release, let that energy come out through the body, through the voice, through your language.
So in that sense, it was super helpful for me later in. In business in ways that I never would have. Oh, for sure, dude.
You know, I'm just.
[00:08:52] Speaker A: I'm having a hard time because, like, you and I have talked about, like, monetary policy and the discounted cash flow.
Like, there's no chance I would have Been able to win that bet that you have an acting background.
[00:09:05] Speaker B: Yeah.
[00:09:06] Speaker A: Oh, that's so funny.
[00:09:08] Speaker B: So I, I think I counted, I went on like 400 auditions.
[00:09:14] Speaker A: Oh my gosh.
[00:09:15] Speaker B: Out of the 400, I, I got 100 different things, like everything from. I did a lot of theater, student films, short films. I did some daytime television, like really commercials and stuff. Roles.
No, I didn't go, didn't, did not do commercials.
[00:09:31] Speaker A: No commercials.
I was hoping there was going to be some ridiculous medicine commercial that I could have found from you from like 20 years ago or something.
[00:09:39] Speaker B: No, but there is an independent film on that you would see on IMDb that, that I did, did act in.
But.
Yeah, but to kind of tie that back to your question so that the genesis of me looking at management was me looking at different directors.
So I had different acting teachers, I had different directors and I started to notice just the wild difference in their approaches and their abilities and the results they got interesting.
So, so that was kind of that foundation that I was starting to put together.
[00:10:19] Speaker A: But was it inconsistencies that you were seeing amongst them or like.
[00:10:23] Speaker B: Yeah, yeah, yeah. It's like, like the, just the way they would approach it or the way they would treat people. Like, did they know what they were doing? Did they not know what they were doing?
And did they have a plan? Was it a good plan? Was it not a good plan?
And you know, sometimes they, they would like, I, I would see it and I would think, oh, they, this person doesn't know what they're doing and then they're blaming other people for that. Right, of course. Right, yeah.
So they didn't see. Just because they didn't. You know, directors don't necessarily work with 100 other directors and get to see what all the differences are and start to form their own way necessarily. But actors do get to do that and they get to see the wild differences.
So I had that when I started making the transition over to business.
And at first I thought, oh, this is wildly different. But. But then after a while when I was working with. At first I was a temp and I worked in different places and like,
[00:11:27] Speaker A: were you sick of eating ramen? I gotta go back to.
[00:11:30] Speaker B: Oh yeah.
[00:11:31] Speaker A: What was the leap into like business?
[00:11:35] Speaker B: Well, one of somebody who had been an actress who went to the same acting school I went to had taken like a couple day course as a proofreader.
[00:11:46] Speaker A: Okay.
[00:11:47] Speaker B: And she was working in law firms doing proofreading. And I thought, hey, I know grammar and I can read and I'll. I'LL do that. So I, I, I needed money, so I went to ask her, hey, what was that two day course you took?
And I went and took it. And I started getting temp jobs and I was working nights, but I was working in law firms and, and ad agencies and investment bankers were making pitch books.
So that was my actual initial segue. So I went from, if you want to get my story.
[00:12:27] Speaker A: This is so awesome.
[00:12:28] Speaker B: In addition to answering your question.
[00:12:30] Speaker A: So cool.
[00:12:31] Speaker B: So I was proofreading and then after a while I was like, well, I see these other people who are actually making the pitch books and they're making more money than I am reading them, so I want to do that. So I learned how to Type and use PowerPoint and I was making the pitchbooks at Morgan Stanley.
[00:12:49] Speaker A: And then were you acting at the same time doing this?
[00:12:52] Speaker B: Like, while I was doing that, what
[00:12:54] Speaker A: was it like seeing those two different worlds of like investment bankers versus your starving artists? I mean, like, oh my goodness.
[00:13:03] Speaker B: I guess it wasn't as dramatic as you.
[00:13:05] Speaker A: Oh, really?
[00:13:06] Speaker B: Yeah, only because I never waited tables. But I know like there's like all kinds of stuff going on in a restaurant and the drama there, the pressure. So it was just like another thing and something.
I, I don't know, it didn't feel,
[00:13:27] Speaker A: it didn't feel like two different worlds. It just felt.
[00:13:30] Speaker B: Yeah, it did not feel like two different worlds also because there were other people who were actors doing that same thing.
[00:13:36] Speaker A: Got it.
[00:13:37] Speaker B: Right. So I guess maybe that's why it didn't feel like, because I could do this. But I could also talk about, oh, auditions and stuff with the people that I'm doing it with.
Got it. Yeah.
So, yeah, so that turned into, eventually I was programming and then I, I got a job at nonprofit microfinance organization.
And that's where I started to, that's, that was my first actual full time job.
And I started meeting all these people who were MBAs. A lot of them were Harvard MBAs and people from around the world and they were working really hard and working late into the night and yeah, that, that was a bit of an eye opener for me. And I said, well, I would like to, Oh, I noticed even though these people had like Harvard MBAs and were managers for a long time, like they were still like unable to get things done.
And I, that's when I discovered project management. I said, well, there's got to be, somebody has to have figured this out. Like, how do you just get things done?
And so I jumped into that and then I Got a job that led to me getting a job at Smith Barney as a project manager.
[00:14:55] Speaker A: So let me double click on that for a second. So you're watching people. Where are there conversations going on where, like, they're talking about what they want to do and then you're seeing the gap of like, oh, yeah, this is what they want to do. But for some reason they're just not. Like, how were you able to get the visibility of the lack of getting things done?
[00:15:17] Speaker B: If I think because I heard people kind of say, hey, we know we're doing this big, like they would have big meetings, right?
We know we have this big meeting coming up. We can get prepared for it. We have things we need to put together.
We don't have to be rushing at the last minute and then make those last minute mistakes. But yet it would happen again and again and again.
Right?
And yeah, so I, and that's where I started thinking, well, it doesn't have to be that way. And people are saying it doesn't have to be that way, but it's easy to say it doesn't have to be that way. Right. So what do you actually do? And that's where it actually, I realized, hey, that's a, it's a whole different skill set. Like, you would have to actually devote, you know, real estate in your brain toward learning this other skill set. And yeah, so that, that was that. That sort of started to open my eye to that. And then I, I dove into it and I, I got a job at Smith Barney as a project manager.
And then that's when I, I applied to, I wanted to get my MBA at that point. So while I was there, I got my mba. The project management job then turned into product management because I wanted to kind of own a P and L, right?
[00:16:42] Speaker A: Yep, yep, yep.
[00:16:44] Speaker B: And somebody there, I, I'd met a woman and she, she had told me, hey, the way to advance your career is to get that level of responsibility where you own the P and L and you actually understand the dollars and cents behind what you're doing. And not just am I saving money, but hey, where is the money coming from?
So that was great advice that she had given me.
And then while I was at Columbia, I, I met Tom, and by the end of it, he had invited me to come and, and join the company that his father, Gerd had had founded.
[00:17:23] Speaker A: Were you guys sitting next to each other in class? Like, I'm just curious, like, who was in the class? And how did you guys start rubbing shoulders and getting to be friends we,
[00:17:32] Speaker B: we had a, A, an exercise before the, the, before school, before we. We started the semester. So there was the, like, team building exercises that we did.
And we had this challenge as a team that we had to see how. How could we make sure everybody touches the, the tennis ball and how quickly can we do that?
So we kept trying different things. And I remember Tom had. He was holding it and it got a little chaotic. And I said, hey, let's let like, Tom's holding this. And I kind of gave him the authority to then give us, like, be the leader in this situation.
[00:18:16] Speaker A: I love it.
[00:18:17] Speaker B: Yeah.
So, yeah, we kind of bonded over that and then. But then the bonding, like, happened more. We were away for the first week and a group of us said, hey, we'll wake up really early and we'll go for a run. Oh, no, we'll play.
I think it was paddle ball or handball, something like that.
And he and I were the only ones who showed up. So we kind of realized, oh, we're gonna do something at 5am we can trust.
[00:18:45] Speaker A: There's not a lot of people willing to do that. Be there.
[00:18:47] Speaker B: Yeah. And then over the course of the next two years, when we were on learning teams together, when we were working on something and it was getting late into the night, like some people would drop off at 9, 10, midnight, but Tom and I would go, like, we'd be there till 3am trying to make it that much better.
So just this level of trust started increasing and we, we both were like, really, we're both dreamers and we get excited about things and we, we enjoyed like, talking and bouncing things off each other like that.
But then we. So it's like that. That balance of, of dreaming plus being willing to roll up the sleeves and do stuff. Yeah, do stuff. Whether it's stay up late or wake up really early, we know that. That we're both willing to work really hard to make those dreams come true.
[00:19:37] Speaker A: Oh, that's so cool, man.
[00:19:39] Speaker B: Yeah.
[00:19:40] Speaker A: When you're.
So you're. You're going through the project, you go through the project management mba.
I'm really fascinated about seeing how your.
What I'm gonna call for my own words here, your emotional intelligence from body language communication, your acting background, like the liberal arts versus the NBA world. Because, like, it's.
This is good. This is giving me the full picture of you as I've gotten to know you over the last six months. Right, Got it. This is making way more sense.
[00:20:15] Speaker B: This weird guy makes sense.
[00:20:16] Speaker A: No, I mean, I think it's why Also we get along because I, I've, I resonate. I mean, when I get, when I met Thomas, like, oh my God, like, I really enjoy dynamic personalities where we can talk about, I mean, consciousness all the way to like a spreadsheet, right? Like, it's just like there are not a lot of people that like can bounce around like that. But what I find fascinating, I'm curious if you can stitch these together for me is I think some of the issues that so many that the schooling system in general has, this is my projection onto it is so like project management. I could see a lot of people coming out of a system like that being like, look at this project management spreadsheet. You have Gantt charts, you got KPIs, you got all these things.
MBA. I was sitting in with one of my clients.
They have a completely new executive team.
The first time I was at the board meeting, there was three MBAs. I'm like, they couldn't talked their way out of a box because of how poor their emotional intelligence was.
And so like they're really good at whatever tests that were in the MBA program. They obviously nailed all those. So whether it's the test, the academics, or like the spreadsheet with Gantt charts, the people are the people that get done. So like you've somehow figure out like there's two sides. I mean, we have a left and a right hemisphere of our brains. There's a lot, you know, you've, you've, you know, from my observation, stitch those two together.
Any comments about how you're, how you were able to see the interaction of like getting things done? What's the combination and the balance between the people and the systems?
[00:21:58] Speaker B: Oh yeah, Yeah. That, that kind of ties back to a little bit to your earlier question too.
So what I observed when I like even going back to like my life in the performing arts, right.
I would see things fall apart and why does it fall apart?
Like, I would see good things not be done well.
And it ended up being.
I wouldn't say.
I wouldn't.
It is people, but I wouldn't say people. I would say more group dynamics.
[00:22:44] Speaker A: Right, okay.
[00:22:46] Speaker B: And then I saw that same thing happen in the business world too.
So I saw some, some pretty serious dysfunction happen.
And it was a breakdown.
It's usually a breakdown of communication. Like when there's a breakdown in relationships, it's a breakdown in communication. And there's all these acting exercises that are designed for this specifically. So it's, I see it as a skill. It's not like, oh, you're either born with it or you're not.
It's something that, that you can train and can learn. And it was funny because the first week of, of when I was getting my mba, they had improv actors come in and we were doing exercises together. Yeah.
And. And I don't know if you ever heard of the, the yes and exercise where somebody says something like, and you, you sit face to face with a person just looking in their eye, and they'll say something, and then you say yes and. And you say something else that builds on it, and yes, and yes. And so I've also taken classes at Upright Citizens Brigade.
And yeah, that's really important in improv because then you, you increase the trust that you have with the other person, and it just gives you this sense that you're moving together in the same direction.
Right.
And so what I typically say is, like, the quickest breakdown of a team will happen because of those group dynamics.
And there are things you can do to help those group dynamics. And that being a tool which I think, like getting to see project management, improvisation. Like these different fields, like these different fields have figured out things that in other fields, people think, oh, you know, if you don't have that, you're. You're a bad person or something.
Right. These other fields have figured it out. And I've just. I guess I've just seen that over and over again where I start to realize so many more aspects of our lives are skills that we don't even think about.
So if there's, if, if we talk about, oh, systems and processes versus the people side of things. Well, there's people in the systems and processes. There's systems and processes in the people side of things also.
And, and yeah, so there's, there's separation between those concepts, but there's also a synthesis between them as well.
And yeah, and I guess even, even tying back to your earlier question, like, I, I saw these weaknesses and, and problems cropping up, and I, I kind of, when I was at, with Tom at our company, and I, I realized a lot of people think, oh, you know, our company, there's something wrong with our company.
We're not good enough as a company. Other companies are so much better. They don't have these problems. And I was like, no, companies have these problems.
And it's not unique to us. We, we, like management is a weakness for us, but it's a weakness across companies, across industries, you name it. And I, I read so many books. I'm reading a book Right now on Saturday Night Live.
And all the problems I hear about that they have, there's like problems with communication and feedback and then people are assuming somebody's not a good person because of this, that or the other, and then it turns into a clash with them.
All that happens in, in every single company. Right. It's not unique to that. So, so I started thinking, oh, if we could figure this out, which I'm pretty sure that different aspects of these different problems in management have been figured out somewhere. If we can like bring them together and create a, you know, a, a system, a management system that covers the people, covers the process and the product, then wow, we'll be a different company. We're, we'll, we will be able to have something that differentiates us from the rest of the world, so.
[00:27:35] Speaker A: And have it be more enjoyable while you're playing the game.
[00:27:38] Speaker B: Oh ye, Completely. Completely. And it was, I don't know if you ever heard of W. Edwards deming, but in 2013 I wanted to learn more about quality and continual improvement. And somehow I read an article and it mentioned him and I thought, oh, I want to know more about him. So I found out he wrote books and I read the books. I met people who had studied under him.
I met his grandson at the, the Deming Institute. I went to take their training and it really opened my eyes. I, I, and I think it was around that time I read Ed Catmull's book.
He was one of the founders of Pixar and he was describing how he went through he, when he was, became a manager, which I think was like the late 70s, early 80s, he was reading all these books and they were all like, he was finding them to be like bad or to horrible right at that time or just not useful, not, not actually working for him until he discovered W. Edwards Deming.
And the, one of the big takeaways I, I got from Deming was that hey, people come in, they want to do a good job.
And he, he said that like 93 of the problems you can trace back to management, like management owns the responsibility of the system. A good, a bad system will break a good person every time.
And I thought, oh, okay, well I wanna, I wanna learn this.
[00:29:27] Speaker A: So super fascinating.
[00:29:29] Speaker B: That kind of led me on that, that's what sparked it for me to, to go on this journey of hey, I want to get really good at management. I want our company to get really good at management. So if I'm going to do that, I got to define what is management.
And once I Define it. I got to have a really good way to train it.
So goes into how do we as humans, how do we learn?
What's the optimal way for us to absorb new skills?
[00:30:04] Speaker A: Oh, so good. So many things there because we're going to get into actually the structure of like the nine quadrants and then like the skills ladder and stuff like that. Because I want to, I want to give people a taste for like how you've actually put structure on this.
There were some questions that I had there about yeah, let's, let's just do that because that was, that was. I love the background David, because I, I mean that, that, that quote of systems will break a good person every single time. And like I think about like what I am infatuated with was which is like understanding systems. Like I really like it because like systems have an inherent first principle that will continue the system going forward. And it's about incentives and about like that's why I've like wanted to learn the game because I think now, I've now remembered my launching off point because this is why give some context for the listeners and for our, your nice community. The, the people that you and I have been, you know, you've been on the calls with the group and stuff like that. These owner operators, like I believe they're inherently good people. They're the builders of the economy.
They found a problem, they were really good at something and they built something valuable with a lot of really good people.
A lot of times they struggle because they're the servant leader to the point where like they have to take care of themselves. They have to put their oxygen mask on first otherwise the business and everything will eat them alive. And then they're going to make a drastic decision to get out of something and it's, it won't be for the benefit of everybody. And so I feel like a lot of these people that you've gotten to know and Tom it like have inherent skills of doing similar things. Like their emotional intelligence and EQ is really high. Like that's how they've had. I mean they have to get people bought into like whatever they're doing. And like whether it's 30, 50, 100, couple hundred people are following them and then they're like, okay, I don't know that. Then it's like I, and that was my experience watching my father, watching myself, didn't understood the system. So then I went, you know, and overcompensated. Like how does the game of business really truly work? Because the inherent system and the inherent motivations will organize everything else and it will chew people up and spit them out. If you don't understand the system, then there's the. So let's take kind of the approach of we believe that people listening in for the moment understand the game of business because they've been following us, because there's a lot of people in the IBD community that are going to be listening to this because a lot of people are interested in the management mastery. So we hit the I believe button for a second. Like, okay, we understand the game of business and ibd.
Now there's this big issue of being the perpetual cheerleader, where people that are at that are the founder, owner, operators, have a skill set similar to what you're saying is what I've noticed. And I remember this in my family business, like yesterday, I was the cheerleader running around and, like, getting people bought into the vision, trying to, like, I would have a gut reaction of like, okay, this person's cancer, this person's not right. Like, this. This. This department dysfunction is because of that human being who, like, there's this phrase that I love. You can put a drop of milk in a gallon of gasoline. Nothing happens, but you put a drop of gasoline in a gallon of milk, it's. Well, this whole gallon.
And that was like, why my. I watched that time and time again because I was the soccer captain. Whether it's building teams in school and or at the company, it was like very. So I saw a lot of the stuff, like you got visibility into with the different directors and stuff. And I feel like a lot of the people in the community are similar. Like, you just have a sheer volume of experience of, like, visibility, but then trying to extract that out of your freaking head. Because I watch when I hear people, David, say, I'm really exhausted.
If they've even built the system. So let's assume they've got their forecast, they got their systems, they got their leadership team. Like, they've done all the mechanical stuff we're constantly teaching.
And then they're just like, I'm just still tired because if I go on vacation, team dynamics fall apart.
And there's this one phrase that you've said multiple times that I watch people's face go, uhhuh. Where if they go on vacation, what you want to fill in?
[00:34:29] Speaker B: Like, what that phrase, if you go on vacation and your team is making things better when you're not even there, right. You come back. That is the best feeling in the world.
[00:34:42] Speaker A: Amen, brother. And yeah, I think your System helps with that. We're like, we're taking the raw talent and emotional intelligence and experience from these owner operators. And you're doing on the people side like I've been trying to do on the business game side.
[00:35:00] Speaker B: Yes.
[00:35:00] Speaker A: And so how did you start taking the systems and the people to say, okay, like, if you believe what I heard you to say is, like, people inherently good. This is a skill that can be trained. How did you start identifying, like, how to go about doing this? Instead of, you know, gravitating towards, like the project management checklist or the, you know, the personality profiles that people are using, you decided to, like, like, what was the inception in your head of, like, what this looks like? And how do you actually create that experience of there's a system in here that makes people better?
[00:35:34] Speaker B: Yeah, well, was about looking at it as a set of skills as opposed to a set of inherent qualities.
[00:35:46] Speaker A: So that's how you started with, like, okay, you believe that there are skills here that can be taught. So that's why you, when you said the last thing, you said, like, how do we learn? So then you, yeah, you started identifying or starting down the quest of, like, how do people learn? And then how do, like, what are the inherent skills?
[00:36:02] Speaker B: Yeah.
Yes.
Which sounds so much easier than it actually is.
The, the first place we really started with were, were the values, right. So that, that we, we got in a room together.
This is, and this is one of the exercises now within Management Mastery, right. When we're talking about integrated people, we got together and we, we identify what are the values. Because there's some people who are coming through here, they're doing well, some people are not doing well. Let, let's define that. Let's, let's get explicit about it.
And so we, we did.
And, and that was using those examples and saying, okay, what do we, what do we think is important?
And doing it as a group activity, coming up with three, because we want it to be something that people can remember. Three is a really good number.
It's a powerful number.
And then defining those values from, like, if you're unskilled all the way up to. If you're a master at the value and the different levels in between.
[00:37:21] Speaker A: So the skill ladder has to do with specifically the values you've identified.
[00:37:25] Speaker B: Yeah, we did a ladder for each value. So all three values have a ladder that defines. And then when we get new examples, when we got new examples of somebody doing something.
Oh, is that on the ladder? No. Well, then let's add it to the Ladder. So we were continually improving it with real world application that became super powerful and fundamental. And then the other place where we went after the values or I guess where I was devoting my personal energies was toward how do we create a learning plan.
And that learning plan has the learning goals.
Then we define what the skills are that make up the goals and then what are the learning activities. And that's where it really like defining the skills sounds so easy. And it's very, very difficult because you have skills and then underneath those skills you have other skills and then there's sub skills and micro skills and, and I have multiple examples of, of those. But coming up with the learning activities, most people when they want to train somebody to do something, oh, I'll just tell you to do it, right. And if you didn't do it well, what's wrong with you? Like you, you don't care, you're not smart enough or you don't work hard enough. Right.
And some people spend a lot of time with training, but they're just doing lecture or demo as the learning activity.
Meanwhile there's a whole, I mean there's no one right learning activity that works.
By the way, there's a tremendous amount of research that went into this on my part. I was reading like 36 books each year to develop this, this, this overall framework.
But I learned a lot about how we learn and, and the process that people go through. But if you get a combination of learning activities for each skill, which takes a lot of time, it takes time to just put it together, but it only takes time to put it together the first time because then you start to have a system that you can repeat with the next person and you come up with really good learning activities for well defined skills that lead to a good learning goal.
That was the very first place that
[00:40:13] Speaker A: and that learning goal management training. And the learning goal is to go up the ladder of skills to that value.
It's like when you say like so the learning goal, what would that. Like the goal would be what?
[00:40:26] Speaker B: It could be that value or it could be anything else. I mean the, the, because the learning
[00:40:30] Speaker A: how people learn is, is you, you, you built that system so that way you could go up the value ladder. Is that what.
[00:40:37] Speaker B: So you go off the value ladder. But, but it also applies to any other skill right. Within the organization. Right. Values being one example of that. What, what I, I wanted to do was for managers to start to see their role. If you're a manager, your job is to be a teacher, to be a Coach. And if you're not teaching people, then you are not doing your job as a manager. Right. Which most managers did not see them. Their. Their responsibility as, oh, I got to be a really good teacher.
Right. To. To. In order to develop people.
But if they have that skill, then their success and their team success skyrockets.
Right.
[00:41:25] Speaker A: Yep. I. Okay, so I want to unpack different parts of this, because then I think we can put some even more meat on the bone for.
I'll go back to. The result that we're trying to build is getting things done through people. And I think that was from. From your mastery part of the. Of the. The ladder. But I want to. I want to go back to the values. So maybe I'm gonna get a little bit nuanced on each of these aspects, because I think it's really important because so much gets lost in the platitudes of mission vision. Values, as everybody, you know, put. You know, you've heard me about it in the. In the group calls, and it's because most people don't have the substance to back it up. They did it in some eos planning meeting or some, you know, some consultant told them to do it, but they don't embody it. And it's really. It's really interesting and the small, slight digression, but in the spirit of just you and I like riffing on things that we've learned. We were talking about Jordan Peterson. So he wrote this book, Maps of Meaning, which is.
Oh, my God, it's so dense. It's insane. But, like, to summarize what one of the big takeaways that I had.
Human beings map meaning and the values that they have after they've been doing it is what he has come to the conclusion of. So, like, to determine. I'm curious what your thoughts are on this, but what he realized is, like, after people act things out.
[00:42:53] Speaker B: Yes.
[00:42:53] Speaker A: They can determine what their values are.
[00:42:56] Speaker B: Yes.
[00:42:56] Speaker A: Versus, like, I think what happens is. And it sounds like you're.
[00:42:59] Speaker B: You're.
[00:43:00] Speaker A: You're already in on the same pages. People sit in a conference room, and then they just throw against a wall and say, these are our values, but they're not already embodying or acting them out. So values should be surfaced from what people are already choosing to prioritize.
[00:43:17] Speaker B: Potentially. Yes. Yeah.
[00:43:19] Speaker A: Walk me through how you think about values and how you go about that exercise.
[00:43:25] Speaker B: Yeah. So. So the values I had read that.
I think Jim Collins said, value should reflect what you already do, not what you want to do. And I I like that. I didn't 100% agree with that because.
Mainly because I, I saw what, what we did with our values, and I, I'll get into how we formed it. Right.
[00:43:48] Speaker A: Yep.
[00:43:49] Speaker B: I, I want to say, like, how do you use them? So I'm going to start backwards.
[00:43:54] Speaker A: Oh, I like that. Yep.
[00:43:55] Speaker B: Your values. If, if you actually take your values seriously, they will guide your behavior.
Right.
And that will guide your culture. That, that creates your culture.
Your, your customers experience your culture.
Right. So eventually they experience your culture. So the way the people behave internally is reflected and, and customers through interactions
[00:44:33] Speaker A: with the cult, with the, with the customers and what you're doing. Yeah.
[00:44:36] Speaker B: Eventually your customers kind of figure out what your culture is, and that becomes the customer experience.
And is that what you want? So as, as a manager, as a business owner, as a leader in the organization, you want to have consistency between your values and your customer experience.
And when you're selecting the values, like there, you have to be very specific with the questions, very specific and direct with the questions that you ask in order to figure out what you want your values to be.
And, and the way I see it is that the.
What, what's important there is you want to make sure your values define how, how do we treat each other?
How do we want to treat each other?
Right. What do we want to. What, what standards do we want to hold ourselves to even when nobody's looking?
Right.
And what are we, what are we going to stand for even if it becomes a disadvantage to us in some way?
And I think that's where it's, it's difficult. And, and like you're saying, they could just be words on a wall, and people figure out really quickly if that's the case.
[00:46:00] Speaker A: Let me interject there for a second, because one of the things that I personally despise more than almost anything is hypocrisy.
I try every single day to bridge the gap between my, what I believe to be my values and how I act. And every time that I'm upset with myself, it's because there's a too big of a gap of what I want, what I want to be in versus what I'm doing. And that's a constant battle.
And it's. Because what happens to me specifically, David, is I, the, the, the emotion of resentment is so gross to me. It's every single time that emotion has overtaken me in a dysfunctional way. It's not good for Ryan. Like it. And it could show up in personal relationships, in business, whatever it is, and I believe in my personal world, resentment comes from hypocrisy for me, like, like, and like. And that's why I hate tyranny, because tyranny is hypocrisy at the highest level of authority. Do this while they're doing something else. And like. So that's why I have, like, complete allergic reaction to authority. That's tyranny, because it breeds resentment inside of me, which brings the absolute worst out of me. And that's my own personal experience. And I. I believe that there. Maybe not everybody's got the. The same visceral situation as I do, but I just personally know how dysfunctional resentment can be and how that manifests and just boils inside of people where it's like the conversation with their spouse at home, or it's like, how they just refuse to call the customer back or how they start, like, digging at their team members. And. And so, like, all of these different ways. And I think it's because people put these values up onto the break room, and it could be almost worse than putting nothing up.
[00:48:05] Speaker B: Oh, yeah, yeah, for sure. I don't know. That's.
[00:48:09] Speaker A: I don't know what. What my point inside of that is, other than, like, what I. What I'm really appreciating is how you've broken down the values, because this is so important, because it's what people want to be. And, like, if we don't adhere to them, it can be so dysfunctional, I think.
[00:48:27] Speaker B: Yeah. And I think part of, like, the hypocrisy or. Or, you know, the honesty or just being genuine about it kind of comes out when you. When you create the ladder for each of the values.
Because I didn't come out of the gate and say, hey, I'm an expert in every one of these, and I embody it every single way, every single time.
And Tom didn't either. Like, we were honest and I think had a level of humility to say, hey, we're all on a journey here together. And in fact, like, my. One of my highlights. So accountability was one of our.
Our values. Right?
And we had the ladder of accountability.
And I was so happy when. When one day when I said something and then somebody else, like, one of somebody on our team said, oh, where does that put you on the ladder of accountability, David? I was like, oh, come on. Okay, let me try that again.
[00:49:37] Speaker A: That's awesome.
[00:49:38] Speaker B: Which sends many signals like, hey, you know, keep me accountable. Like, hold me to these standards also and point out when I'm.
When I'm swaying from it. And hey, I want to, I'm not going to, you know, punish anybody for that. In fact, I'm going to thank them and, and publicly congratulate them for doing that and say, hey, I do it again. And let me, let me get up on this, this ladder too, in a more complete way, which is, which is good. And I think that's important.
[00:50:20] Speaker A: So anyway, how did you to move from then the values to the ladder? Just one final thing on the values. Do you, do you see that there's like a set of like 20, 30 values that people can choose from and then it's just more about like what they resonate with or is there an actual process you go through to identify these three?
[00:50:40] Speaker B: It's, it's a process to identify them.
[00:50:42] Speaker A: Okay.
[00:50:42] Speaker B: And it kind of starts with, hey, what, what are the values that are important to you personally?
[00:50:47] Speaker A: Yep.
[00:50:47] Speaker B: And that like people. And it's not a multiple choice thing either.
[00:50:53] Speaker A: Okay.
[00:50:54] Speaker B: It's, it's what comes up. And there are some things that come up that are kind of common. Sometimes people will use different words for the same thing and there's, there's not really a right or wrong so long as they do that. The values that are chosen do cover how are we going to treat each other, what standards are we going to hold ourselves to when nobody's looking and what are we going to stand for even when it's a disadvantage?
[00:51:18] Speaker A: I love that because it's just back to my total passion behind tradeoffs. We're like, the value comes up when there's a trade off. And I like that last. I mean, like when it's challenged. Yeah, I have this or that and I have to. The value is what drives the choice. I think.
[00:51:36] Speaker B: Yes.
Like, I'm willing to suffer for this value.
[00:51:41] Speaker A: Right, right, right, right.
[00:51:43] Speaker B: As opposed to I'm going to do something and then try to reverse engineer my justification for it after the fact.
[00:51:50] Speaker A: I'm willing to suffer.
I love it.
[00:51:57] Speaker B: So that means you believe in it. That means.
[00:51:59] Speaker A: Yeah, exactly. Right, yeah.
[00:52:00] Speaker B: And, and, and when you're that explicit with, you know, what's important, like, okay, if you are going to be a part of this group that we have and we're giving you, you know, we're laying it out for you.
Here's what we believe and here's what we adhere to and here's what we, what guides us, then people can almost decide for themselves, oh, I, I want to be here. I don't want to be here. Right.
[00:52:32] Speaker A: You want people to select out because like yeah, because that's back to the consistency between the values and then the customer experience and the culture.
Yes. Because then people are inherently intrinsically making those trade offs and it's about selecting the people that are going to do that themselves so you don't have to micromanage them like you've said.
[00:52:51] Speaker B: Right. And if you're, like, if you, if you go against one of these values like accountability, like I've had people, I've seen people who were very low in accountability and they thought, oh, I'm going to be able to fly under the radar or something, but sending that signal. No, that's.
People have tried, but it's kind of obvious. It even became obvious for us when our customers, our suppliers, like the people within those companies were low in our values. And I'd hear somebody get off the phone with a customer and say, wow, really low accountability over there. And it just gives you clues to what happens. But we implemented these, we use it for hiring. Like we'd have different people meet with a new candidate and each rate them on the value scorecard and compare notes.
We use it for reviews of people internally.
Values were central to that.
And it's a very important part of the management training process too, where people self assess themselves against the values. They'll ask somebody to give them feedback and they'll give somebody else feedback.
[00:54:08] Speaker A: I was gonna say, what are the, is it three or four questions that you always are constant repeating?
[00:54:13] Speaker B: Oh, yeah, what works? What do you do that works well?
What do you do that does not work well? And what could you do that would work better?
It's those three questions.
[00:54:22] Speaker A: Were you, would you, did you ever fire any customers or suppliers because of this?
[00:54:29] Speaker B: Yes.
That's, that's where it's really difficult.
[00:54:35] Speaker A: The disadvantage in the money for, for the time being.
[00:54:39] Speaker B: Yeah.
And I think the, that, that also comes to another, like, list of priorities, which I love. And I, I don't know whether Southwest Airlines was the first one to do this, but I heard Herb Kelleher talk about it where custom, I mean, employees come first and if, and you know, we take care of our employees. And, and he had examples where he, like somebody said, oh, I'm not going to use you again. And he said, well, we'll miss you. But he's not firing his employee. Right. He's, he's keeping the employee as long as the employee embodies the values.
[00:55:14] Speaker A: Right, right.
[00:55:14] Speaker B: I love that.
[00:55:15] Speaker A: Yep, yep, yep.
[00:55:17] Speaker B: And yeah, like sticking to the employee, sticking up for the employee is, is super important.
And then Then customers come after the employee and then the shareholders. Because if you take care of your, your employees, your employees are going to take care of your customers and your customers will take care of the shareholders.
[00:55:37] Speaker A: So, so much.
[00:55:39] Speaker B: This is nice.
[00:55:40] Speaker A: It's so interesting because, like in the strategic planning session that you and you were a part of, I think there's a lot of similarities, like how this is part of the strategic planning too, because you're choosing who you want to be for the person that you know, the customer that you want to do it for. I don't want to digress.
The skills ladder, you said it was very difficult to understand what the. Or to come up with the skills ladder. So you want to walk us through, like, how did you, where did you land on and what was kind of the journey to come up with the skills ladder and how it's structured?
[00:56:12] Speaker B: Oh yeah. It really modeled after the, the different levels of, of learning and it starts with unskilled. So anytime I'm defining something, I'm also defining what it's not.
[00:56:23] Speaker A: Yep.
[00:56:24] Speaker B: So. So the bottom, you're talking about the different levels of the skills ladder from
[00:56:28] Speaker A: unskilled, because you're doing the ladder in relationship to accountability, right?
[00:56:32] Speaker B: Yes.
[00:56:33] Speaker A: Okay.
[00:56:33] Speaker B: That's right. Yeah. So what does it mean to be unskilled? So if somebody is, you know, they don't make commitments or they don't meet their commitments or they'll blame others, other people, they point the finger, that sort of thing would be kind of low, like unskilled on the ladder of accountability. And then we have the novice level. So we define. What does that mean?
Oh, I, I make commitments.
If I'm not going to meet my commitment, I give updates regularly. Right.
Then the next next level up would be like apprentice. Right. So we were defining it very specifically, like what you're doing at each level all the way. So it's, it starts out at unskilled, then we have novice, then apprentice, practitioner all the way up to master. So the practitioner generally.
And these, those levels show up across skills.
And generally if you.
[00:57:35] Speaker A: What do you mean those, those.
So the skills ladders show up across skills.
[00:57:41] Speaker B: I'm.
[00:57:41] Speaker A: I guess I'm confused by that.
[00:57:43] Speaker B: So you get the, we use that same skill ladder. So this, we apply it to accountability.
[00:57:47] Speaker A: The skill ladder is applied to skills. And what the skill as we're defining right now would be the value accountability. But it could maybe me be machinery.
[00:57:58] Speaker B: Yeah, exactly.
[00:57:59] Speaker A: Okay, okay, okay.
[00:58:00] Speaker B: Exactly. So, and usually practitioner level means you've got it. You, you are the shiny example you're consistent, you're independent and.
But it's, it's still kind of you to be master level for any of these. You have to be able to develop other people to come up to practitioner level.
[00:58:23] Speaker A: Oh, I love it.
[00:58:25] Speaker B: So the, the master is the one who's saying, I'm not just doing it myself, I'm getting other people to do it. So I'm. And in, in terms of accountability, it's like, oh, I'm, I'm creating a culture of accountability.
That's what you have to do to be. Become a master.
[00:58:42] Speaker A: That is how you go on vacation.
[00:58:45] Speaker B: Yeah.
[00:58:45] Speaker A: Come back and things are better when. Even though you were gone.
[00:58:50] Speaker B: Yes, exactly.
[00:58:53] Speaker A: What I think is so cool about what you've got here is that, I mean I just, I think about the community that we've got here. Like, that's what I.
We'll have to do this for ibd, by the way.
[00:59:06] Speaker B: Oh yeah.
[00:59:07] Speaker A: Like, because like I've had some experiences recently where it's like not a fit and I don't, and I'm doing that out of gut.
Like, I don't have a, I don't have a ladder.
[00:59:19] Speaker B: Yeah.
[00:59:19] Speaker A: I don't have any specific values. And like I, like I've said to the, the community, like, I believe that my job is to be the steward of making sure that like at the summit, David, whoever someone's sitting next to, they feel like they're a long lost sibling, you know, I mean, or something like what you and Tom had is at your mba. But I think I go back to like what I think everybody else feels. I mean, this is tied into the noble aim concept where like, if the noble aim, you know how IBD starts off and the ownership goals is to have the highest impact to the most amount of people over the longest time. Spanish that's, this is how we can actually quantify. How do we raise people up.
[01:00:01] Speaker B: Yeah, right.
[01:00:02] Speaker A: Because like if, if we can go from, if we become the, the mastery of our leadership of our company, then we're bringing everybody else on the C suite into practitioners and like, and I like, because I'm, I've got this vision and this, I can. This visual because as you and I explore how do we integrate management mastery into module seven, like if the owner and CEO, owner operator is both of those roles already.
[01:00:28] Speaker B: Yeah.
[01:00:28] Speaker A: 90% of the people in IBD have the couple people have the CEO, but like they're mainly the owner operator. The next like the highest point of leverage for them for their time is to get that C Suite built out with the three functional leaders. So they. They're not managing all of these different KPIs. Right.
But if we do that with the right people, then that owner operator only has like, not only can focus on three and like, let's say it's a CRO, coo, cfo, maybe it might be the HR and cio. There could be a couple other people at the top. I understand that. But like the, the main leverage, they're. You know that Dunbar's number where I talk about the 150 people and it's that, that fractal.
[01:01:16] Speaker B: Yeah.
[01:01:16] Speaker A: Being aware that we can only manage so many relationships if we as the owner operator apply management mastery to that C suite to get them taught how to do this, then they can then per. It's a fractal and it's exponential because it goes from that owner operator to then three to four people. Those three to four people each have probably 10 people. And then it becomes this exponential nature which where the.
I used to run around with my chicken with like a head cut off trying to talk to 100 and some people every week, you know what I mean? To see, to see my judgment of my gut feeling about how the team dynamics are doing and how everybody's doing. Is everybody embodying the values. It's like, ah, exhausted. And that's how everybody I know feels where this becomes a cascading effect.
[01:02:08] Speaker B: Teaching them how to do that very same thing. And then you, you drive it down and the further down you drive it within the organization, the more successful it becomes. And I've found that, I mean, well, two. Two of my Shiny Star students were people who came to us as interns originally.
[01:02:34] Speaker A: How cool.
[01:02:35] Speaker B: Yeah, so they were still in college that we ended up hiring them out of college. And then they just really ran with it. I mean one of them was Sarah. She was an engineer at natech and she just really embraced it and put forth the effort. You can tell when people are doing this. You got to allocate some real estate and like in your brain for these new skills when you bring them on. But I saw her go through this and the impact that it had on her career and her ability to then manage a team of people and do it well so quickly after having graduated college was just beautiful to watch.
[01:03:23] Speaker A: And what I think is really interesting is I. I've been talking to a couple of the members recently and there's this theme that keeps popping up where as people start building the business using the owner's playbook, they're getting.
They're more excited to keep running the business instead because like, they're like, yeah, I want out of whatever the chaos is that I'm dealing with. I don't think people necessarily know what they want out of, which is why we had the whole boardroom blueprint. But once people go then through this like visibility of the clarity of, you know, like, okay, I understand where I'm at. And they start putting these building blocks together like, hey, this is actually fun again. I do believe that running a business can be one of the highest forms of purpose and impact.
And it's because of what you were just saying of like getting the Sarahs. It's not. I mean, yeah, we want to make money. Like I love making money, but like it's the, the impact outside of ourselves. That noble aim of getting more and more Sarahs to have. I mean, can't imagine like I'm assuming that had an impact on Sarah's personal life.
Personal relationships.
[01:04:31] Speaker B: Yes.
[01:04:31] Speaker A: Her success. Yeah. I mean it. And that becomes something that I think is really purposeful for people and like why?
[01:04:39] Speaker B: Oh yeah, yeah.
[01:04:40] Speaker A: I just, I love it.
[01:04:41] Speaker B: Yeah. I've had so many people mention that. Like people who go through it and kind of embrace it and they say, you know, I actually end up using this my personal life. And it does help out in that way too.
I often say like we like it can be dangerous to try these things at home.
But at the same time, why is that?
Well, if like with your spouse, if you take a manage managerial role with your spouse, it doesn't always end well.
[01:05:15] Speaker A: But what if I'm always the vp? I just always want to be the vp.
Yeah, I'm already aware of that.
[01:05:23] Speaker B: But like the communication and hearing people actually answering questions, you know, I think all of that applies in, in personal relationships also and, and sticking to your.
Your values.
Taking a kind of a principles first approach to situations that you find yourself in.
But even like you, you know, a vacation is a project. Like you got to plan it and you can plan it well or not.
[01:05:54] Speaker A: I'm aware my wife treats you like that. I am not in the same camp of the checklist for the vacation.
[01:06:02] Speaker B: Yeah. Did we forget something? Do we.
[01:06:04] Speaker A: We just buy it on Amazon will be fine.
[01:06:09] Speaker B: Do we get to the airport on time or do we miss the plane? It's like those things happen.
[01:06:17] Speaker A: Implementation and ongoing maintenance of this program. Like I think let's maybe there's a couple more. Let me think a lot here. So I'm curious about implementation and then timeline. Maybe this, let's take like a 75 person company or 100 person company of like timeline to go from the CEO owner maybe to the frontline customer service person.
[01:06:46] Speaker B: Yeah.
[01:06:47] Speaker A: And there's probably a spectrum of what is it, you know, to, to the point where then it's maintenance mode and then how does it show up? Is it in reviews, is it in the, you know, the operating system meetings? I mean, so there's a lot, a lot behind that. But what are your thoughts?
[01:07:01] Speaker B: Oh yeah.
In terms of maintenance, it's, I think what you said earlier is one key part of it, which is you, you know, as you bring in new people, you want to train the new people. Right. On, on this. And I, I advocate for training people even before their managers on this because that's like Sarah is an example, started training her on this and then by the time she was manager, she was kind of ready for that and she didn't have this preconceived notion of who she has to be as a manager or.
But she had a, an awareness of what her responsibility is and that she could be herself.
Right.
I find a lot of people, yeah. Like just sort of dispelling some notions or stereotypes people might have about what it means. Who do I have to be if I'm going to be a manager? I got to get tough on people.
[01:08:06] Speaker A: They're just going to make up whatever their, their, their narratives are in their head of what that authority person should look like.
[01:08:12] Speaker B: Yeah. So we can get that out of the way and, and get, get them to have a good understanding of, oh, what does it mean to be a manager. Right. And on a simple level, design, implement and integrate the people, the product and the process. Right. So those, those intersections, those nine intersections give us the nine knowledge areas of management.
So it takes something that's kind of messy and, and complicated and at least starts to give some clarity to it for people, which kind of puts them at ease is what I find. And then on an ongoing basis, well, you create as you go through the process.
You're creating learning plans.
Right. You're creating your values and you're creating your, your strategy.
What are we actually delivering to our customers? You're creating your processes.
Right. You're improving your processes and you're making sure the different flows within the organization actually work well together.
So those that can be in the form of a KPI dashboard. Right. That looks into those, those different flows within the organization.
So like the, another answer to that question is like the, the maintenance side is you're, you're maintaining those things that I just mentioned. Right.
And you're continually improving your learning plans, your values, your strategy, your processes within the organization.
[01:09:49] Speaker A: Are you doing that in like.
So I don't know if you're, you know, with EOS traction, like weekly meetings and huddles with teams and then like monthly or quarterly meetings. Is it ingrained in kind of the.
This becomes. It sounds. It's. I could imagine that this would become a cultural thing. Like it just becomes part of what you're doing while you're playing the game of business.
[01:10:11] Speaker B: Yeah. And what is the right cadence? There's no one right answer to that.
Right.
What I find that works well is. Is at least a growing organization. You keep getting new people who are coming in and you're getting new eyes on your values, your strategies and your processes.
So from that sense, you're not necessarily waiting for kind of a set cadence so much as people are contributing. If it's, if it's continual, I think that's what's key.
[01:10:51] Speaker A: Is there like a tipping point? And there's this study recently.
I'm very fascinated with it because my kids are turning 10 this year and, you know, the onslaught of everybody needs a device is very real for parents.
And there's this study out I got. I can't remember where it came from.
And just it made common sense to me of like, if a third of the students in a class don't have devices, those students don't feel left out.
[01:11:25] Speaker B: Oh, okay.
[01:11:26] Speaker A: Isn't that fascinating? Because like.
[01:11:27] Speaker B: Yeah.
[01:11:28] Speaker A: Versus if it's smaller than that, they feel ostracized.
And I think about like, you know, the Malcolm Gladwell tipping point kind of concept or like, if we're trying to really change a culture, I can only imagine there's probably at least a somewhat loose correlation to what you're doing to say, hey, if a third. Ish or more people are embodying this, then you've got this critical massive growth of the system where it's going to start to prune. All of the people that are not adhering to the core,
[01:12:09] Speaker B: I think they're the tipping point happens with, with some people, but there's definitely some people who are not. This, by the way, this was always voluntary thing. We. We never made it mandatory.
[01:12:24] Speaker A: Oh, interesting. Okay.
[01:12:26] Speaker B: Yeah. And there were people who I. After enough people, I saw the full.
The bell curve. Right. So there's a distribution of people who don't do it at all to people who, you know, the Sarahs of the world who really embrace it and really go for it.
And most of the people would fall somewhere in the middle where they're, they're doing it. But maybe not as necessarily as quickly or consistently interesting.
[01:12:58] Speaker A: Voluntary versus mandatory. So like how did you, how do you hold someone accountable on a ladder of accountability for a value that the company has identified? If you haven't made, and I don't know if I like the word mandatory, but if you haven't like totally ingrained it, like how did you manage that spectrum then?
[01:13:17] Speaker B: Yeah, it was a little organic. I would, I guess I would say where the people who did embrace it and did well with, with the training started doing well as managers and people
[01:13:35] Speaker A: popped to the top then.
[01:13:37] Speaker B: Yeah, yeah, yeah. And, and it's not a quick thing either. It's like you can't rush through it and get it done, get it all done in three months and, and suddenly you're superstar manager.
Right.
That's kind of where this came from. Was like I, as I was putting it together, I, I realized hey, I went to business school, I didn't go to management school. And, and management is not something you can go in a classroom or you know, a laboratory and come out being
[01:14:11] Speaker A: a better into acting school manager. It's as close as it could possibly be.
[01:14:18] Speaker B: Yeah, well you, you gotta do it right. You gotta get, it's, it's one of those things. You gotta do it. And that's why it's designed to be an on the job training program.
I think I was telling, I found that more meetings with people, like more short meetings with people was better than hey, you're going to do this all in one week.
That, that did not, that kind of thing didn't work as well. Right. Like condensing it, but like getting, getting the concept go off, use it, let it, let it sort of work itself out with you mentally and as in terms of what you're seeing and then come back and you want it. It also helped me because I could really get to know people who were going through this process and how, how well they were doing and, and what was, what was clicking for them.
[01:15:18] Speaker A: You had a tight feedback.
[01:15:19] Speaker B: Kept me connected.
[01:15:20] Speaker A: Yeah, yeah, yeah.
[01:15:21] Speaker B: Get me connected in kind of a structured way where I could make it helped me make decisions too. On, hey, is it worthwhile to give this person more people to manage? Right. Or are they having difficulty because you know they, they are not, they don't have the skills. Right.
[01:15:42] Speaker A: How did, did you go through a process of as you implemented this or maybe you've got thoughts about other, other Observations of people implementing it where I can imagine. I just think about my old company or the clients that we're working with, like, there's gonna be a recalibration because people have made, they've, as you identify the values, then they become more like, hey, now we have to adhere to these.
[01:16:10] Speaker B: Yeah.
[01:16:10] Speaker A: And so then it's like, okay, then that brings relativity and okay.
It's kind of obvious that there's already a pe. A chunk of people or individuals who are not probably going to be rehired if we were to start over.
[01:16:25] Speaker B: Yeah.
[01:16:25] Speaker A: How do you any, any words of wisdom on, like, how to deal with that transition period?
[01:16:35] Speaker B: The transition period of. Wait, what?
[01:16:38] Speaker A: What, like, all right, now that I've identified my values and the, the latter so, and so is definitely. I would never rehire them.
[01:16:49] Speaker B: Oh, okay.
[01:16:50] Speaker A: And they're already clashing. Just the fact that we, I labeled these values immediately puts them at odds with who we want to be as a company.
[01:16:59] Speaker B: Oh, yeah. Well, that's, that's where when you create the ladder, it becomes a scorecard. Yeah, Right. And all you have to do to make it a scorecard is add the, the three boxes underneath each value. What are they doing that works well? What are they doing that's not working well? And what could they do that would work better?
And yeah, give the feedback.
You're being very explicit and direct and clear.
What we do is we would bold within the definitions at the different levels what the person's doing.
And then we'd add qualitative feedback in those three buckets also.
And then it's, you know, then it becomes clear, oh, if I give somebody this feedback and three months later I have exactly the same feedback, then improvement's not happening.
And to be fair, maybe improvement's not happening because I'm not good at training people to this value, which is possible. But yeah, you know, at least I know, hey, this person's not working out with this value. They're not figuring it out on themselves. I'm not able to guide them to learn it. So I have a decision to make. Is this really my value or not?
[01:18:23] Speaker A: Okay, well, this is, this opened up a whole nother set of questions. But we, I, I know we're probably running short on time here.
Maybe we can pick this up later. But is it possible to have a value and not be able to teach that value?
[01:18:44] Speaker B: Yes and no.
[01:18:45] Speaker A: I, I, that's a great non. Answer.
[01:18:48] Speaker B: Well, any value can be defined as a skill, and people can get better at that skill. So it can be Every value can be learned.
Whether or not I can teach somebody, I can't force somebody to learn. I can be there to help facilitate their learning.
[01:19:07] Speaker A: Interesting.
[01:19:07] Speaker B: But I cannot force has to be a decision that that person makes as to whether or not they're going to do it.
And that's, that's where having this explicitly defined where, hey, I know I've communicated to you what my expectation is.
I can be really good at teaching it.
And you still don't learn it.
Right.
[01:19:36] Speaker A: Can you, can you not? Like, like I said, I'm tracking that.
Can you have the value and not be good at teaching it?
Or, or is the, or is that worried then the whole point is the skill ladder and the KPIs. So that way they're taking the responsibility over doing it themselves.
[01:19:52] Speaker B: It's, it's. Well, where it would work best is if both happen.
I'm, I as a leader within the organization want to be good at teaching it.
So step one of teaching it is I'm going to be explicit about it. Right. I'm going to lay it out for you so it's very clear, easy to understand.
Then it's up to me to come up with what are the activities learning activities to do.
[01:20:19] Speaker A: Yep.
[01:20:20] Speaker B: And, and so through the process of
[01:20:23] Speaker A: implementing management mastery that is essentially the form of the teaching. Creating the skills ladder, creating the values, making the explicit, coming up with the activities. So someone might not be an inherent teacher from their default, but by following this process you kind of end up becoming the teacher anyways. And then the person has to then lean in to actually take self responsibility over it.
[01:20:46] Speaker B: At the end of the day the person has to, has to be willing and ready to learn. And that takes effort. And that's, that's where like developing the management mastery framework kind of came from. We were doing it as group activities originally, which turned into people weren't really putting forth the effort to acquire the skills. And to acquire skills requires effort. Right.
[01:21:17] Speaker A: Mental capacity, leaving mental real estate for this, as you've said a couple times.
[01:21:23] Speaker B: And if you're acquiring a skill, you can't just be a passive recipient of knowledge. Oh, I'm just going to listen and then I'll do it or not do it when it comes up kind of thing.
It goes beyond that. It's like you got to get good at it, which requires practice, which requires struggle. Right. That's when the learning happens.
And we want to take people out of the comfort zone, into the learning zone, but not all the way to the panic zone.
So.
[01:21:52] Speaker A: Well, Said man, I love that.
[01:21:55] Speaker B: So that's why we, we took it from. Oh, it's a group thing where people would just kind of sit, come in and hang out and listen to it being a one on one training thing where hey, you have a learning activity. When we meet next time you're going to do the learning activity.
So that's where a lot of the, it became even more obvious. The people who were willing to put the struggle in this area which is not bad. Like not everybody has to be a manager. Right.
You can be really good individual contributor and you don't have to be become a manager. It doesn't, you know, I pass no judgment, zero judgment on, on that.
But if person does want to be a manager it's super important that they're willing to put forth that struggle to do it. And, and that was the approach that, that we took in the organization.
[01:22:48] Speaker A: Tom, this. I'm Tom. I can't believe I just did that. I've been talking about Tom. To me David, this was such an awesome conversation man. I, I'm so excited to keep these conversations going. I know that the, I can already picture like the half a dozen people from the community that are probably listening to this.
You're going to be at the owner summit coming up.
We're doing a group training with you and I know that you and I'm really excited to keep exploring how we can integrate you into the module 7 and I've even got a couple other ideas.
You've got a program you've been working on now that you're free from your other responsibilities from the previous business. So you've got people that you're going to be engaging with and you want to just talk a little bit about like you said that one on one engagement. So like you're working with people to help implement this.
[01:23:46] Speaker B: Oh yeah, yeah yeah. So which is definitely something that I, I love doing. I have a big passion for I business in general. Who would have thought right.
And I love it so much. Small businesses especially I, I love seeing small grow and improve and yeah. So I set up these sort of one on one sessions with usually the business owner to start with is, is a nice place and then over time it can kind of drive down. I feel like the IBD is, is really nice because what you're building is a model that creates freedom so that I as a business owner know how to manage my, my board. Right.
And, and this kind of goes dives down into the, the frontline managers if you will who are out there Making the improvements and how people get, it's
[01:24:54] Speaker A: how they can get more freedom of their time while continuing the momentum. And, and I literally just picture that dumb bars number of like okay like you can only manage an inner circle of so many people and if you can help them with management mastery, say okay like because we've got the playbook now of like okay there are three functions and like so IBD is sitting as that, that bridge between the executive team and the you know, CEO, CRO, co cfo. And then what is the ownership shareholders want which is a lot often the same and a lot of them have the same hats. We want to push the people thing, the people systems all the way down through the organization but just by the physical constraint of time they can't be the ones to do it right. They have to actually create a system if they actually want to get what they want. And so when I think about what you and I have been working on and learn how to dance together over the last six the so months is like I think a lot of the people in the community like it's, I've been really excited to watch them grab on to like what does an actual Chief Revenue Officer do? Like what's the job description? What should. Because like, like what happens is when they, when they've come up from the ranks, these owner operators, there was never an actual job description where they like had the confidence of holding someone else accountable to the technical stuff because they were never like I mean I was talking to Darren, he's like I was never heard salesperson. I was a boiler tech. So like right. I thought that they were just gonna do the job and next thing I know I'm like should I expect that or should I not expect that? And no one helps him really crystallize that. And so that, that was one of one of my passions to say hey, these are objective truths about what these player positions should do no matter what. And like the size of the company will matter whether it's a fractional leader or it's a full time leader. But like we need revenue, we need margins, we need cash flow. It is, it just is fairly straightforward to that but outside of the technique and I watch them grab onto the technical side, then it be it's really apparent that what you've built is how they then also push down their values through the organization. So it's not them being a cheerleader in the hallway to 100 people all the time, which is no totally exhausting. And I so I'm just so excited to like, you know, mesh these two things together.
[01:27:22] Speaker B: Yeah, and, and yeah, so this, the, the management mastery model ties these things together on that level, which is what are we actually doing?
And okay, we have job description. Right.
How does my job description relate back to my processes? Right. So if I have work instructions, my work instructions. Each work instruction is a skill in and of itself.
And ideally, when they roll up to some level, it's going to show up on my job description as my responsibility.
And what I'm doing on my job description, I want to have a learning plan for it too. So I want to keep getting better at that. And if you're training people on how to do these things, then you're, you're, what you're describing gets pushed out within the organization and then the people are making the, the job description better because it's not going to be perfect right out of the gate. The process as you define it, is not going to be perfect out of the gate.
All of this is in the interest of creating the learning organization, which is, you know, that's, that's all about how do you achieve mastery and how do you translate your individual knowledge that each person has into organizational knowledge?
[01:28:48] Speaker A: I like that.
[01:28:48] Speaker B: Right, Yep.
And, and you do that with your job descriptions, with your values being explicitly defined, with your learning plans, with your strategy that ties into the products that you have that you're delivering to your customers, which also ties to the processes that you have. So all of these fit together toward that. And if you have a whole organization of people who get that picture and how they fit together and what, what they're doing with each piece and they can make those pieces better, that's, that's the dream, right, that, that gets you as a leader.
Freedom.
[01:29:30] Speaker A: Totally, man. And like, you and I are going to have to absolutely geek out at the summit and ongoing where I believe the reason so many organizations have absolutely no idea what to do with AI is because they don't have the IBD core, which is what is the actual goal of time, cash and wealth. What are the financials? What are the actual specifics?
Because if you don't know, you don't know. And then all the, all the stuff that you're talking about, I mean, I'll plant the seed here because I, I really think that this is gonna be super fun. David.
I believe that a company should have a data lake of like all of their data. And then you should take an organizational chart with seriously clear roles and job descriptions and those seriously draw like the org chart tied to Then the job descriptions effectively is like active directory is. Sits on top of the pool of data.
And then everybody should have a digital AI twin for their job. So that way the continuous AI improvement, the continual learning improvement, like, we can't do this if we don't have a job description. So, like, what I've been doing with Claude with AI, same thing I've been helping with our, with our community, is like, we have a CFO job description that's from module seven and a CRO and a COO. It's 15 pages and it's like all of this technical skill sets and intangibles all like, here's what it is. And the CFO oversees the fourth module of the three statement model in the financial. So now we have taken all of the ambiguity around what does a CFO do? What are the technical parts of that? And then so when I log up into cloud, I'm like, all right, Claude, you're the cfo. And it's like literally immediately knows.
And so now we have this perfect digital twin of AI with that job description and that role that is just unbelievable. And then we need to layer that access to the knowledge of the company,
[01:31:25] Speaker B: knowledge on how to do the role,
[01:31:27] Speaker A: on how to do the role, how to get better at the role. And like. So, like, there's like. And, and I say all this, David, because I absolutely believe at the bottom of my soul, the IBD operating system and what you're doing has to be done first before people go hog wild with AI. Because you get down, you sit down in front of AI and it's just like, if you don't know what you want, what your job description is, what the goal is, what the skill ladder is, you're just making up all day long. And then you're wondering why everybody's confused and resenting and crabby and dysfunction. And it's like, so to go slow, to go fast is one of my favorite phrases, because this work that you and I are talking about is why I'm able to go so fast. And I'm watching some of the people in the community go so fast is because they're not sitting in front of AI or in front of their team wondering what they should be doing. Everybody's very clear. And then you can leverage technology instead of assuming technology is some silver bullet, which I think it just exacerbates the dysfunction that's already there.
[01:32:34] Speaker B: Yeah, you got, you have to have a.
You have to be the focus, you have to direct it, where to go, what to do.
And then keep refining it too.
Right.
And I think some people, I guess get frustrated that the output, the initial output from that they get is not good.
But I, I would say whether you're using AI or you're doing it yourself, a person, he was doing it.
It's 0. 0% or 0 level of surprise that
[01:33:12] Speaker A: you weren't clear on what you want and you're wondering whether your employee is confused.
Right?
[01:33:17] Speaker B: Yeah. But it's hard and it's hard to know that the first time, like you, you. It's a, it's an iterative process like you keep going, keep refining And I think 100 expectation that that's, that's what's going to happen, which I think throws some people off. Right. Because they think, oh, I'm going to do this and check it off and then I'm going to move on to the next thing.
It's a way of life.
[01:33:37] Speaker A: It's a way of life.
[01:33:38] Speaker B: Yeah.
[01:33:38] Speaker A: It's a habit.
[01:33:39] Speaker B: It's not the way it works.
[01:33:41] Speaker A: My friend, this is so awesome. I appreciate your time, appreciate your involvement in the community. Super excited for the summit.
I don't know if you've got a website up yet. I know we're going to put you on the IBD website, so if we're going to do just link you to there, but we'll make sure when this goes out, we got links that you want out there.
It's been a lot of fun, my friend.
[01:34:01] Speaker B: Yeah, I've enjoyed it. Thank you.
We'll have to do this again.
[01:34:05] Speaker A: Oh, we're going to.
