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If Your Employees Keep Quitting... WATCH THIS! · Home Service Millionaire with Mike Andes

• 0:00
  After meeting hundreds of home service entrepreneurs, I've realized that there's one thing that keeps most seven-figure entrepreneurs from being an eight-figure entrepreneur.
• 0:10
  So they passed a million, two million, three million dollars in annual revenue, but they just keep hitting this wall and not be able to grow the business, and it's because of one thing, and that is a lack of leadership.
• 0:21
  And conceptually, we all know that leadership is important.
• 0:24
  We should become a better leader.
• 0:26
  We should learn that.
• 0:26
  We should read a book or listen to a podcast.
• 0:29
  But I want to talk today about why it is so important to develop your skill as a leader once you pass seven figures.
• 0:37
  When you're a solo operator, when you have one, two, three employees,
• 0:41
  doing the work out in the field yourself is many times the best form of leadership.
• 0:45
  Leadership by example, meaning I do it this way.
• 0:49
  Now I'll watch you do it this way.
• 0:51
  And now you do it yourself.
• 0:53
  And the technician watching you do the work and then you demonstrating what should be done is an incredible form of leadership.
• 1:04
  That is possible for six, eight, 10, maybe 12, 15 technicians or employees inside the business.
• 1:11
  But it gets to the point where you can't be demonstrating what someone should do in their job every day, every week, every month.
• 1:20
  once you get so many employees.
• 1:22
  And this is where most people cap out because good management is different than good leadership.
• 1:28
  Management is I am gonna give someone an SOP.
• 1:31
  I'm going to track whether or not they are complying.
• 1:33
  I'm going to manage their jobs.
• 1:36
  I am going to do quality control.
• 1:38
  I'm gonna do oversight.
• 1:39
  I'm gonna require a checklist.
• 1:40
  I'm gonna look over the checklist.
• 1:41
  I'm going to ensure that I am managing my technician.
• 1:45
  I am managing my manager.
• 1:47
  And that works good.
• 1:49
  But once you get to the certain size, I need people to be able to take initiative and solve problems on their own.
• 1:55
  I can no longer rely on me fixing the problem and showing them what to do.
• 2:01
  Leadership by example, putting your boots on when there's a problem and jumping out in the field, is a phenomenal form of leadership when you are a smaller business.
• 2:10
  But every big business, a lot of times people call them pencil pushers because they're in the office, and the right thing for that owner or that CEO to do in the case of a fire going on in the business is not to put on their boots, jump into the field, and solve the problem.
• 2:25
  There might be times you do that for morale or to be able to demonstrate a certain cultural aspect to your team.
• 2:31
  But as the leader of the organization, I have to actually diagnose why system failure happened and then empower other people to find the solutions and make sure that it doesn't happen again.
• 2:42
  As an operator in my business, I see a fire.
• 2:46
  I go find the water.
• 2:48
  I rally the troops and we put out the fire.
• 2:50
  As a leader, I ask myself whether or not there needs to be a hydrant built closer in that neighborhood so next time the fire gets put out faster.
• 2:59
  And I'm going to ensure that my team and their managers have the training to be able to use that hydrant and put out the fire next time.
• 3:07
  And so many times great operators, what gets them to a million, two million, $3 million in annual revenue is actually the exact skill that has to be unlearned so they can become a great leader.
• 3:21
  They're not the ones going out and putting out the fire.
• 3:23
  They're not the ones that are enforcing the system.
• 3:25
  They're not the ones enforcing quality control.
• 3:27
  There are other people doing that
• 3:29
  and they've stepped out of the building to be the architect and worked on the business.
• 3:33
  And when you're running a four or five, ten, $15 million business and you have 50, 100 employees, you jumping out and trying to solve a problem actually creates chaos in the business.
• 3:42
  It actually hurts everyone else because you handed something off and all of a sudden in a moment of crisis, once a year, you jump in and try to solve it.
• 3:50
  And it feels to them like, do they trust me?
• 3:54
  Do they think I can't do my job?
• 3:56
  Why am I even doing this if they're just gonna step in and solve the problem every single time there's a fire?
• 4:01
  So many of us have heard very successful entrepreneurs say, the reason that they're where they're at today is because their team, because the great employees, the people that have been with them for 10, 15, 20 years, we have heard that and we know that conceptually to be true.
• 4:17
  And yet, we still go back to constantly trying to think about a new marketing hack.
• 4:22
  We ask, okay, how can I get my Facebook ads?
• 4:25
  How can I get my website refined?
• 4:26
  If you're at one, two, three million, it is finding the right people that will solve those problems, that's the unlock.
• 4:33
  Finding the right marketing manager to be able to find the solution to your ads problem.
• 4:38
  finding the right operations manager to ensure efficiency with the crew, finding the right mechanic to ensure that the trucks are going out correctly every morning, instead of doing things yourself.
• 4:48
  Inside the 4L framework, we talk about liquidity being the bottleneck.
• 4:53
  This is many times when you're first getting started, you need some sort of working capital.
• 4:56
  And with home services, the thing I love about it is you don't need a lot of liquidity.
• 5:00
  You don't need a lot of cash to get started.
• 5:03
  So, so many people get started.
• 5:05
  They have enough capital, even if it's a couple thousand dollars, to get the business off the ground.
• 5:10
  And in order to be able to continue growing in the 4L framework, we gotta now get leads.
• 5:15
  This is going to come in the form of advertising, marketing, going on knocking on doors, doing some sort of promotion to get leads.
• 5:22
  Now, if you get enough leads, you gotta get employees, you gotta get technicians, you gotta get labor.
• 5:28
  And so, we have liquidity, then we have leads, then we have labor.
• 5:32
  And now you get all these leads, you gotta hire people, and now you get five, six, seven, eight, nine, 10, 12, 15 technicians, laborers, and this is where most people start hitting this wall.
• 5:44
  One to two, three million.
• 5:45
  It's not the revenue amount, it's the fact that the next unlock in the 4.0 framework is leadership.
• 5:52
  most operators are really good at managing their labors.
• 5:57
  They're really good, they're incredible actually.
• 5:59
  They're so good at it, they never migrate to becoming a leader and the unlock going 10 to 20 employees to 20 plus employees is almost always figuring out the skill of leadership.
• 6:11
  Because as a leader, I am able to find managers to manage my labors and most people never make that migration.
• 6:19
  Very few people can have the money, get the leads, get the labors, and then become the leader and change the entire way that they operate inside the business to no longer be the manager, the operator that's working with the labors, but rather be the leader that attracts great talent, retains that talent, and effectively communicates with that talent that is managing the labors.
• 6:43
  And if you figure out that not the trifecta of everyone thinks about the trifecta of business is like, OK, I got leads and I got liquidity and now I got labors.
• 6:51
  Great.
• 6:52
  Yes, you will build a one to two million dollar business.
• 6:54
  But the thing that keeps you from going past that is this the fourth component of the four framework, and that is leadership.
• 7:01
  I've traveled the country for the past few years, fixing struggling businesses, over 100 of them.
• 7:06
  And a lot of them are between $900,000 in annual revenue and $2 million in annual revenue.
• 7:13
  And almost always this constraint that they're hitting up against is leadership.
• 7:19
  If you have a whole bunch of churn at mid-level management, very, very difficult to continue scaling.
• 7:25
  And so you ask, wait, I identified this as either a problem I'm going to face because I'm coming up to a million.
• 7:30
  I'm going to need an operations manager.
• 7:32
  I'm going to need a sales manager.
• 7:34
  I'm going to need to go hire someone in the office and be my office manager.
• 7:37
  I'm going to have to build up this mid-level team if I want to continue growing.
• 7:40
  Okay, great.
• 7:41
  What should I be doing?
• 7:43
  First off, the biggest challenge.
• 7:46
  First, the biggest thing is identifying that leadership is the problem, not the things that have served you well in the past.
• 7:52
  In the past, what served you well is grinding and hustling and solving problems around client acquisition.
• 7:58
  And now the problem will be talent acquisition, finding great managers, becoming the leader that they want to work for,
• 8:07
  creating a vivid vision for the business as to why it exists so that that manager wants to keep working for you.
• 8:12
  Because a grade A top savage manager could go start their own business.
• 8:18
  They could go start a business that has six to eight to 10 technicians.
• 8:22
  because they're really good at operations.
• 8:24
  And they'd be a phenomenal operations manager to build a million dollar business.
• 8:28
  They could go do it themselves.
• 8:29
  So you've got to become the leader that they actually say, hey, you know what?
• 8:32
  I'm not going to do that because this vision that this leader has is so clear and so vivid.
• 8:38
  And it is so big that I can fit my dreams and my goals inside of it.
• 8:42
  And so if you've hit up against this wall, you can't grow anymore, or you feel like there's this friction, like there's no middle level manager stick with you for a long time, you have to realize that this is the morphing of operator into leader.
• 8:55
  And it is hard.
• 8:57
  But once you do this, it is like this,
• 9:01
  momentum and this wave behind you that you are able to ride.
• 9:05
  And whether it be at Homeworks, or whether it be at Augusta Lawn Care, or whether it be in the media side, I have been extremely blessed to have phenomenal mid-level management that has stuck with me for a very, very long time.
• 9:17
  and it is the unlock.
• 9:18
  Like it's the thing that doesn't show up on a P&L.
• 9:20
  It's not the thing that I'm gonna talk about in a podcast interview, because it's really exciting to say the same thing that we all have heard a thousand times, which is people are amazing.
• 9:28
  Do whatever you can to retain great people, find a talent, and then make sure you build the business around them.
• 9:33
  Make sure that you're communicating effectively with them.
• 9:35
  Make sure you have a clear vision.
• 9:36
  We've heard all this stuff a hundred times.
• 9:38
  And the reason we have is because it's true and it's basic and it's simple and it's not as flashy as the next whiz bang Facebook ad or do this on AI or do this software program.
• 9:47
  Those are the flashy things that are constantly changing.
• 9:50
  Get this type of truck, this type of equipment.
• 9:52
  Add this service.
• 9:53
  Do this on your Google My Business.
• 9:55
  These are all tactics, but really those tactics a lot of times get you to a million.
• 10:00
  You can have one really good Facebook ad with a really good offer that gets you to a million dollars in any revenue.
• 10:05
  But you can only manage so many technicians and home services before you need mid-level management.
• 10:09
  And the only skill that is required to keep good managers is leadership.
• 10:14
  And so if you don't have a clear vision, you don't know how to do a one-on-one with your managers, you don't have the ability to know what their goals are and then aligning the goals of the business with their goals, ensuring that your communication style is not preventing people from staying with you.
• 10:29
  The best talent, the best operations manager, the best mid-level team that can manage other technicians, that can manage other team members, they have options.
• 10:38
  They can work just about anywhere.
• 10:40
  So why would they work for you?
• 10:42
  Why is the vision?
• 10:43
  Why is there compensation?
• 10:44
  What is different about you as a leader compared to every other one of their bosses?
• 10:48
  That's the only reason they'll stick with you.
• 10:50
  Having the humility to realize that you are the problem when there is mid-level management turn and you constantly are beating your head up against the skill of leadership is the first step.
• 11:01
  having the humility and not allowing your ego to flare up and say, it's everyone else's problem.
• 11:06
  No one else is, will work hard as me.
• 11:08
  Everyone else is flaking out versus just being like, this is a me problem.
• 11:12
  I must become the leader that incredible managers are like, I've got to work for this guy.
• 11:17
  And,
• 11:19
  They're going to respect me.
• 11:20
  They're going to allow me to grow.
• 11:22
  They're gonna make sure that I'm gaining my skills.
• 11:24
  They're gonna show that my compensation is aligned with the business, that as I take on more tasks and more opportunities inside the business, I make more money.
• 11:33
  They're gonna have open conversations about my goals and the goals of the business.
• 11:36
  And I'm never gonna wonder why I go to work every day because there's gonna be a very clear vision for why this business exists, that I can pass along to the people that I manage so I feel like I can help them get to where I'm at.
• 11:47
  And my leader,
• 11:49
  is helping me get to where they're at.
• 11:51
  I'm moving up inside of my career.
• 11:53
  If there's not that kind of culture inside the business, you will constantly turn out mid-level managers.
• 11:58
  Cause they don't, every day they're asking themselves like, why would I not go work at somewhere else that's willing to pay me more?
• 12:03
  Why would I not just go start my own business?
• 12:05
  And if there's not a common vision that is so clear for them, that keeps them around, if there's not clear compensation plans and a motive for them to stay with you every single day,
• 12:15
  eventually they will leave.
• 12:17
  And there is nothing harder than building an organization where you have constant churn at the mid-level management position.
• 12:23
  And then what happens as a leader is we start not trusting anybody.
• 12:26
  It gets very difficult once you had a whole bunch of churn at that level to trust anyone that's coming in new.
• 12:31
  So it takes us so long to trust someone that every good mid-level manager leaves before we trust them.
• 12:38
  And it's a self-fulfilling prophecy that I don't trust someone when they get hired.
• 12:42
  Therefore, they don't feel like they have full autonomy inside the business.
• 12:45
  They don't feel like I trust them, which I don't because I've been burned so many times.
• 12:49
  And then guess what?
• 12:50
  They turn after three, six, eight months because they don't feel like this is a place that they can grow their career.
• 12:55
  They don't feel like you communicate as a leader.
• 12:58
  And the communication mechanism of a frontline general versus a general that steps to the back and starts
• 13:04
  focusing on strategy has to be very different.
• 13:07
  The person in the front of the battle, and I hate using military examples where like in business, but it all makes sense to us.
• 13:15
  Someone on the front lines is going to lead by example.
• 13:18
  They're gonna be the type of person that in the hardest times jumps out in the front and starts fighting.
• 13:24
  As the business grows, as the organization grows though, that general has to realize that that same type of leadership has to change, that mechanism.
• 13:33
  Where now you're in the back of the ranks, you're at the back of everyone else that's out on the front lines,
• 13:40
  the way that you communicate with your technicians to the the managers that are on the front lines has to change and usually this comes from a place of we have to reduce our ego to realize that there has to be strong leadership inside the organization that is not us there has to be other people mid level managers being able to make decisions for the people that they are reporting to them without our direct involvement and that can be difficult
• 14:04
  This is why we started the school community home service boardroom is because I have seen time and time and time again in my own career and my own personal leadership journey, as well as the journeys of many other entrepreneurs that pass seven figures, the thing that keeps them at that size and is very frustrating and no one feels bad for someone who's built a $1.5 million business, $2 million business and is crying about how they can't keep me level of managers.
• 14:30
  There's all this churn, people are flaking out on me.
• 14:33
  I constantly get dragged back to the day operations.
• 14:35
  No one is crying for them because they're already in the top four or 5% of all entrepreneurs building a one or $2 million business.
• 14:41
  No one's crying for them.
• 14:42
  But inside they're like, this is golden handcuffs.
• 14:45
  Like why keep growing this?
• 14:46
  If I just constantly get pulled back into every single fire, I can never keep a manager for more than a year or two.
• 14:51
  And they're just constant churn.
• 14:52
  And I'm eventually just, it's gonna fall back on my plate.
• 14:54
  So if I scale this thing up, eventually I'm just gonna have more problems, more liability, more mistakes that I have to go solve.
• 15:01
  And if that's you, I would just encourage you to realize that it is a leadership problem and it is you.
• 15:09
  And I made all these mistakes and I had to realize that the only way to improve was focused on becoming a better leader, changing the way that I communicated with my mid-level managers, changing the way that I communicated with my technicians and realizing that the business was gonna grow beyond me, I had to change.
• 15:27
  As hard as that was, it's also very freeing because it means I have control.
• 15:31
  I'm no longer at the whim of the economy or the labor market or my competition or any other factor besides my talent, my skill, my ability to have a direct conversation, my ability to shut my mouth
• 15:44
  when I could solve a problem, but I need to let the manager make the mistake.
• 15:48
  Or I need to let the manager solve the problem so that they feel confident in their next decision-making process, instead of being the problem solver, the one that jumps in and solves the problem right away.
• 15:58
  And that identity change is what's keeping seven-figure businesses from becoming eight-figure businesses.
• 16:03
  And for everyone that's like, well, cry me a river, they've built a $2 million business.
• 16:07
  It is extremely difficult psychologically to constantly pull back into the fire when no longer is it just one or two employees and one fire a week.
• 16:16
  Now you have 20 employees and there's fires every single hour.
• 16:20
  That is extremely emotionally taxing.
• 16:23
  And eventually that's usually what causes a break and that's what causes businesses to go out of business.
• 16:28
  And so I implore you, if you're in that state,
• 16:30
  have the humility, put your ego aside for just a moment and realize that learning the skill of leadership is a long, long journey.
• 16:38
  There are some phenomenal books from Jocko Willink about leadership.
• 16:41
  We have the Home Service Boardroom.
• 16:42
  You can come to conferences like Blue Collar Summit to get around other great leaders, but do whatever it takes to change and morph.
• 16:49
  And it can take a while.
• 16:50
  It took me almost two years to recreate myself as a leader to make sure that the type of person that I needed for the organization would wanna work for me.