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Sustaining Business Success Without Burning Out: Solocast · Learnings and Missteps by Depth Builder

• 0:00
  Speaker 1: So now you got the bigger, sexier projects, you're getting more stuff, and then somebody gets really excited about that next big, giant sexy project.
• 0:10
  Speaker 1: Oh man, we've been wanting to work with that client.
• 0:12
  Speaker 1: If we work with that owner, we're going to get in the paper.
• 0:16
  Speaker 1: We're going to get all kinds of run out of this.
• 0:18
  Speaker 1: We need to take it.
• 0:19
  Speaker 1: That client is so influential in the local community we can't pass this up.
• 0:24
  Speaker 1: Sound familiar.
• 0:27
  Speaker 1: What ends up happening there?
• 0:28
  Speaker 1: You oversell the capabilities of the organization.
• 0:33
  Speaker 1: In simple terms, you just outsold your workforce.
• 0:36
  Speaker 1: I've seen it happen.
• 0:38
  Speaker 1: I'm not talking about you.
• 0:39
  Speaker 1: I pinky promise what's going on.
• 0:46
  Speaker 1: L&m family.
• 0:47
  Speaker 1: I got a solo cast for you today and I'm going to be diving into.
• 0:52
  Speaker 1: I don't even know what to call it.
• 0:53
  Speaker 1: It's like the indigestion trap, and when I say indigestion, there's a saying out there that most businesses don't die from starvation.
• 1:03
  Speaker 1: Most businesses don't die from starvation, they die from indigestion, and I've been able to see this like play out over and over again.
• 1:10
  Speaker 1: So I want to talk about like what that looks like and I promise I am not talking about your business or your company.
• 1:17
  Speaker 1: It is a dynamic that I've seen play out over and over and over again and also want to give some ideas at the end of it about what I think or what I've seen work in mitigating that, the failure or the collapse of the business like what's really more important.
• 1:35
  Speaker 1: Sure, the failure and the collapse of the business is not good, but it's the quality of life that people lose when they're in this cycle and in this trap.
• 1:43
  Speaker 1: Right, the frustration, the defeat, the failure, the low sense of self all of those things ain't good.
• 1:51
  Speaker 1: And so, if you're new here, I'm Jesse and usually I interview amazing people so that we can learn their tips and tricks and how they carve their unconventional path to success.
• 2:05
  Speaker 1: And every now and then I do a solo cast.
• 2:07
  Speaker 1: And so here we go, here's the deal New team, new business, new organization in a new market.
• 2:17
  Speaker 1: They just came into town, they got a new boss, new department head, new VP came in to take over.
• 2:24
  Speaker 1: You know, you know the deal.
• 2:25
  Speaker 1: Something big has happened and all of a sudden they've got a plan.
• 2:30
  Speaker 1: They've got a different way they want to approach things.
• 2:32
  Speaker 1: It sounds like it's going to work.
• 2:33
  Speaker 1: They start doing it.
• 2:34
  Speaker 1: Then they get some traction right.
• 2:36
  Speaker 1: All of a sudden the market starts responding and say man, like they, like us Okay, start building some credibility.
• 2:42
  Speaker 1: They get some projects to get some work.
• 2:44
  Speaker 1: They deliver on the things that they promised.
• 2:46
  Speaker 1: And then they start getting bigger and sexier projects, because now they've got a name for themselves and people are reaching out and saying, hey, we heard about you or we worked with you on the last project.
• 2:56
  Speaker 1: We want to do another project with you.
• 2:58
  Speaker 1: Things are good, things are humming.
• 3:01
  Speaker 1: Now what's happening here is the business is starting to grow.
• 3:04
  Speaker 1: What I mean by that is the number of people required to deliver the work is growing at this time.
• 3:11
  Speaker 1: So what's also happening, while this credibility, more business, getting recognition, developing a brand is happening, the need for more people is beginning to grow.
• 3:22
  Speaker 1: That doesn't mean that you're out hiring people, right.
• 3:26
  Speaker 1: That is very different than actually growing the team, and we'll come back to that later.
• 3:33
  Speaker 1: So now you got the bigger, sexier projects, you're getting more stuff, and then somebody gets really excited about that next big, giant, sexy project.
• 3:44
  Speaker 1: Oh man, we've been wanting to work with that client.
• 3:46
  Speaker 1: If we work with that owner, we're going to get in the paper.
• 3:49
  Speaker 1: We're going to get all kinds of run out of this.
• 3:51
  Speaker 1: We need to take it.
• 3:52
  Speaker 1: That client is so influential in the local community.
• 3:56
  Speaker 1: We can't pass this up.
• 3:57
  Speaker 1: Sound familiar.
• 3:59
  Speaker 1: What ends up happening there?
• 4:02
  Speaker 1: You oversell the capabilities of the organization.
• 4:05
  Speaker 1: In simple terms, you just outsold your workforce.
• 4:10
  Speaker 1: I've seen it happen.
• 4:12
  Speaker 1: I'm not talking about you, I pinky promise.
• 4:14
  Speaker 1: So now you got all these other little jobs that you had and that you've been building and you've been hustling and delivering on, and you got the big sexy one.
• 4:21
  Speaker 1: And of course, you're going to go get more business.
• 4:24
  Speaker 1: And then, uh-oh, we need more people.
• 4:28
  Speaker 1: So you start hiring more people, bringing new people, and you don't have the time to train and develop them because this work is on your back door.
• 4:38
  Speaker 1: You got to go do the damn thing.
• 4:39
  Speaker 1: So what do you do?
• 4:40
  Speaker 1: You hire experienced hires people that have been in the industry doing the roles that you need, but they've been doing them for someone else, and what that means is they've been doing it differently.
• 4:50
  Speaker 1: Again, none of those points we're going to come back to.
• 4:53
  Speaker 1: The next thing that happens is your customers the customers that everybody was working so hard to build relationships with and build trust with start having an inconsistent experience.
• 5:07
  Speaker 1: They start wondering like wait a minute, this ain't, this isn't what it was like on the last project.
• 5:12
  Speaker 1: Wait a minute, this isn't what so-and-so taught told me about.
• 5:15
  Speaker 1: Like these guys, these people are just like everybody else.
• 5:18
  Speaker 1: That ain't no good.
• 5:20
  Speaker 1: And so what happens?
• 5:21
  Speaker 1: You lose credibility in the market, not because you were trying to.
• 5:25
  Speaker 1: We'll talk a little bit more about why.
• 5:28
  Speaker 1: I think like the why behind losing the credibility.
• 5:31
  Speaker 1: You start losing credibility.
• 5:34
  Speaker 1: Your warranty quality experience starts getting more and more diluted.
• 5:39
  Speaker 1: So you got callbacks, you got cancellations.
• 5:42
  Speaker 1: You start losing business.
• 5:44
  Speaker 1: So you got callbacks, you got cancellations.
• 5:47
  Speaker 1: You start losing business.
• 5:48
  Speaker 1: That's no win-o.
• 5:49
  Speaker 1: And now, because you went in a frenzy to hire people, you got all these people that you've got to carry and that creates this whole other thing that is like less than awesome.
• 5:57
  Speaker 1: Then, oh, somebody in the organization says we just need to get back to basics.
• 6:04
  Speaker 1: Somebody in the organization says we just need to get back to basics because of all the dang demolition that they just did, the good credibility, the good name that was built, and then the cycle starts again.
• 6:15
  Speaker 1: Now I touched on a couple of things, right, one of the things I touched on that I think and have seen be huge in like avoiding this problem, and that's discipline.
• 6:28
  Speaker 1: Discipline to what?
• 6:29
  Speaker 1: The discipline to stay on plan, and so what I mean by that is one of the decision makers up there in the ivory tower.
• 6:36
  Speaker 1: They have an annual goal.
• 6:38
  Speaker 1: Everybody has an annual goal X amount of revenue per year, x amount of backlog per year because that's going to keep the business growing, thriving and healthy.
• 6:47
  Speaker 1: That's the point.
• 6:48
  Speaker 1: And so let's just use $200 million as an example.
• 6:51
  Speaker 1: If $200 million is the annual revenue target and you've hit that target in Q3, you're ahead of plan.
• 7:04
  Speaker 1: What most people do that contribute to this indigestion trap is they continue selling.
• 7:12
  Speaker 1: Now.
• 7:13
  Speaker 1: They may be strategic sales that are pushing out into Q4 or Q1 of next year, whatever.
• 7:19
  Speaker 1: In that case they're not going to be selling.
• 7:21
  Speaker 1: They're not Good, keep doing that.
• 7:22
  Speaker 1: But often that's not the case.
• 7:24
  Speaker 1: Often it's a favor or a little extra for this one client, because we want to build rapport with the client.
• 7:31
  Speaker 1: So they give us that next project that they want to partner on.
• 7:34
  Speaker 1: And there's all these like weird politic things that we start doing Hit target $200 million, oh, $210 million, $215 million, and then we take the big one.
• 7:44
  Speaker 1: And so what's also happening is that $200 million revenue mark was growth right.
• 7:51
  Speaker 1: Hopefully there was some growth built into that, meaning you would be having to, the business would have to deliver more in the new year or by the end of the new year.
• 8:00
  Speaker 1: So there was already a stretch, an expectation of growth built into the goal, and then you exceed the goal or decisions are made that exceed that goal.
• 8:11
  Speaker 1: However, what isn't happening, or rarely happens, is the systems and mechanisms to recruit, train, integrate people into the organization have not been adjusted appropriately, if they even exist, because in a lot of cases they don't.
• 8:30
  Speaker 1: It's just hire people, hire people that's what I am saying is the number one contributor to the problem.
• 8:36
  Speaker 1: Not necessarily the people, but the lack of discipline in pursuing or exceeding that revenue goal.
• 8:43
  Speaker 1: Exceeding that revenue goal because it's easy to say, yes, let's sign that letter of intent, let's, here's the deal, let's start moving forward.
• 8:53
  Speaker 1: That's way easier than it is to say wait a minute, how many people do we have?
• 8:58
  Speaker 1: How many people need to do that?
• 9:00
  Speaker 1: How many more people do we need?
• 9:02
  Speaker 1: And here's the thing how long is it going to take us to acquire, find, recruit a new, experienced, hire, integrate them into our system, meaning, teach them how to do the things the way we do them, so that they can deliver a consistent experience to our client and to the people that have been recommending us that's the trick.
• 9:30
  Speaker 1: Yes, you can hire new people and when you grow what I've seen is when they grow faster or beyond their britches right, they see that big, fat, happy bonus at the end of the year let's go get that bad boy.
• 9:41
  Speaker 1: They're not considering that.
• 9:44
  Speaker 1: Yes, you got to hire people.
• 9:45
  Speaker 1: You don't have time to hire like fresh people out of university, out of high school or out of trade school.
• 9:51
  Speaker 1: You're going to hire experienced people because you don't have time to help them develop the core skills to do the job.
• 9:56
  Speaker 1: But the problem with that is those people know how to do that from a different context, a different definition, a different way of doing that, and so when they come into your organization, you're probably throwing them straight into the damn project and they're going to do it the best way they know how, which may not necessarily be and rather is almost not anywhere near what you want it to be, or what the current standard is.
• 10:25
  Speaker 1: You want it to be, or what the the current standard is.
• 10:29
  Speaker 1: That creates dissension, that creates distrust, the disconnect like it.
• 10:31
  Speaker 1: There's a lot of disses that happen when this, this sort of thing, occurs.
• 10:34
  Speaker 1: So I'm gonna go back to the discipline thing.
• 10:36
  Speaker 1: I got the fortune of working with an amazing forward thinking leader who asked me like what do you think?
• 10:43
  Speaker 1: What are the problems?
• 10:44
  Speaker 1: Man, this is the thing I've seen all the time we get a, a new business unit manager comes in.
• 10:49
  Speaker 1: They got great.
• 10:49
  Speaker 1: Another fan this is like my sixth business unit manager, by the way comes in, has a great idea and they're going to change everything.
• 10:58
  Speaker 1: They're going to make everything better.
• 10:59
  Speaker 1: The BU hasn't been performing the way it was supposed to, and so that's why I'm here.
• 11:04
  Speaker 1: I'm going to fix it, I'm going to make everybody perform, and then they come in and, you know, mess things up and two or three years later they're gone.
• 11:11
  Speaker 1: This one said he spent like, like, for real.
• 11:15
  Speaker 1: He spent about 90 days, at least 90 days, investigating and understanding how we were doing business, how we were doing the stuff we were supposed to be doing or, more clearly, how we were delivering value to our internal customers and our external customers.
• 11:33
  Speaker 1: And then he started saying, okay, what do we need to shore up and step on the gas on, and what are the gaps and how do we close those gaps?
• 11:42
  Speaker 1: So he and I had a conversation and he asked me he's like, why do you think this thing keeps happening?
• 11:47
  Speaker 1: I said, well, here's why.
• 11:48
  Speaker 1: We get a new person in, we start doing pretty good, we oversell ourselves and then we start doing bad and then we start over again.
• 11:54
  Speaker 1: It's pretty simple, like that's what happens, and he's okay.
• 11:58
  Speaker 1: Well, what do you recommend?
• 11:59
  Speaker 1: I said, well, if the annual goal is this, let's just hit that goal.
• 12:03
  Speaker 1: Like, let's hit the goal, because we have to build our internal resources, our personnel, so that we can hit that goal again.
• 12:12
  Speaker 1: Right, like, revenue is great.
• 12:14
  Speaker 1: Earnings is a different question.
• 12:16
  Speaker 1: If you're hitting $200 million in revenue and you got 1% earnings, you got problems, and so let's hit the goal and let's figure out how to take 1% earnings to 4% to 7% or whatever that is.
• 12:27
  Speaker 1: That's a different ballgame.
• 12:29
  Speaker 1: That's a thriving business.
• 12:31
  Speaker 1: So I, in my head, I was like yeah, yeah, you're being nice and you're talking smack, but I'm going to give him the benefit of the doubt.
• 12:38
  Speaker 1: Maybe he will be the one that, like, makes the disciplined decision and doesn't oversell us.
• 12:45
  Speaker 1: Guess what he was.
• 12:47
  Speaker 1: He didn't oversell us, he stretched us.
• 12:51
  Speaker 1: But there were some projects that we said no to because we weren't equipped to deliver on them.
• 12:59
  Speaker 1: What we also did is we had some training that could have been better, or actually needed to be better to bring people in and integrate them into our system, and so that was a much different experience.
• 13:12
  Speaker 1: After year one, it's like, okay, we got some stabilization, we're doing the thing.
• 13:16
  Speaker 1: We had another conversation and I said, well, I mean, it could be a fluke, how about we do it again Before we elevate the target?
• 13:24
  Speaker 1: Yeah, yeah, sounds cute, but we're going to elevate the target, okay, whatever.
• 13:27
  Speaker 1: Now the whole point of that story is the discipline, right, the decision makers.
• 13:32
  Speaker 1: Yes, that big sexy project with the crane that's going to have your name visible for hundreds of miles or hundreds of eyeballs.
• 13:42
  Speaker 1: There's value in that of eyeballs.
• 13:49
  Speaker 1: There's value in that.
• 13:50
  Speaker 1: But if your whole organization or situation is not equipped to absorb that growth because here's the other thing that happens you get a contract.
• 13:54
  Speaker 1: Every contract you have, there's a set price for it, but there's scope gaps and there's change orders and there's expansions, so that's going to grow.
• 14:01
  Speaker 1: Most likely, that is going to grow also.
• 14:04
  Speaker 1: So now you've overshot your target by 20% and the current work that you have is expanding by, let's say, 10%.
• 14:12
  Speaker 1: So now there's a 30% unplanned growth or bubble that you have to deal with, and all the while you're not growing your people, your departments, your capacity within the different departments and all the role players to execute at that level.
• 14:29
  Speaker 1: And so one part of the answer in Jesse land anyways, is to have that discipline to stay on plan and not oversell your work.
• 14:41
  Speaker 1: If you're a decision maker, you don't get to say, rather, if you're a real leader, like OG leader, you don't get to say, rather, if you're a real leader, like OG leader, you don't get to say that's not my problem, that's not my part of the business, because absolutely it is your problem.
• 14:57
  Speaker 1: You just don't feel the worst part of that pain.
• 15:01
  Speaker 1: The other part is this A lot of folks like to think that there's a talent problem in the industry.
• 15:07
  Speaker 1: There's people at Generational and all this other rigmarole, and I know this to be a fact.
• 15:14
  Speaker 1: If I were to give you all the talent that is available in your town, you could not predict whether they would be extremely successful, moderately successful or poor once they hit the project.
• 15:31
  Speaker 1: It's a matter of who they end up getting set with.
• 15:35
  Speaker 1: If they get on a team or a leader that regularly invests in their people, support them and develop them.
• 15:42
  Speaker 1: They're going to be successful regardless of their talent level.
• 15:46
  Speaker 1: If they get on a team that's just living by the hair of their chin, that person is going to have the same experience.
• 15:53
  Speaker 1: If they get on the low performing team, that's just.
• 15:56
  Speaker 1: You know.
• 15:57
  Speaker 1: You know the ones guess what?
• 15:59
  Speaker 1: That new hire is also going to suck.
• 16:01
  Speaker 1: And so it's not a talent problem, it's a system problem.
• 16:06
  Speaker 1: Very few departments I'm not even going to say companies very few departments or leaders of a department or a specific segment of the business know precisely, or even roughly, how long it takes to bring in an experienced hire, integrate them to the processes, systems, controls, measures that that organization uses or that team abides by, so that they can be successful within the new company.
• 16:34
  Speaker 1: Very few people know what that is.
• 16:36
  Speaker 1: Most people are going to refer to that as onboarding and they think it's an HR responsibility, which I don't agree with that at all.
• 16:43
  Speaker 1: Onboarding to the company is one thing.
• 16:47
  Speaker 1: Onboarding or integration into the department or the specific team to the specific role is an entirely different thing.
• 16:55
  Speaker 1: And so that's my thought.
• 16:57
  Speaker 1: If you want to break the indigestion trap, if you want to see or maybe kick this idea around with the people you work with.
• 17:06
  Speaker 1: If you've seen this cycle happen right, maybe not you, you never experienced it, but you know somebody that has I would examine, like ask them how many times do we exceed our annual goal or growth goal or our revenue target by how much?
• 17:22
  Speaker 1: And then the follow up question to that is okay what is our system or method to integrate people into the specific roles so that we can deliver a consistent experience to our clients or to the people that are buying from us?
• 17:40
  Speaker 1: What's it going to take to build that system?
• 17:43
  Speaker 1: I tell you right now it is way easier to build the system of integrating people and helping them understand the core functions, the core responsibilities, the core tech stack, all of those things.
• 17:55
  Speaker 1: It is much easier to do that and that ain't easy, but it's way easier to do that than it is for the decision makers in the business development sales department to exercise discipline and not oversell themselves.
• 18:10
  Speaker 1: So if you want a place to start, my recommendation is start on the system, the method, the way that you bring experienced hires in, run some like do it, do it a bunch and figure out like you can.
• 18:26
  Speaker 1: I bet money and I've seen it done and I've been a part of doing it.
• 18:29
  Speaker 1: You can get that timeline down to about six weeks.
• 18:33
  Speaker 1: New hire has experience done the role for other people.
• 18:36
  Speaker 1: Some people call it brainwashing, whatever you want to call it.
• 18:41
  Speaker 1: Get them through that training, through that integration period and then on the other side of that six weeks they can go execute.
• 18:48
  Speaker 1: They can go do it precisely the way you expect them to do it, but you got to start.
• 18:54
  Speaker 1: So if you think I'm nuts, let me know.
• 18:57
  Speaker 1: I appreciate you taking the time to listen to my little rant here and again.
• 19:03
  Speaker 1: I promise I am not talking about your company.
• 19:07
  Speaker 1: Be kind to yourself, be cool and we'll talk at you next time.
• 19:11
  Speaker 1: Peace.