Latest / The Start, Scale & Succeed Podcast / What to do When You’re In Whitewater and HAVE to Move Forward with Scott Ritzheimer (stages 3,4,5) - Ep. 433

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What to do When You’re In Whitewater and HAVE to Move Forward with Scott Ritzheimer (stages 3,4,5) - Ep. 433 · The Start, Scale & Succeed Podcast

• 0:00
  Scott Ritzheimer: Hello, hello, and welcome, welcome once again
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  to the Start, Scale, and Succeed podcast-the only podcast that
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  grows with you through all seven levels of your journey as a
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  founder. I'm your host Scott Ritzheimer, and we are here in
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  part five of our series. You're not in whitewater, dot dot dot
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  yet, and we've covered a lot of ground so far. If this is your
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  first time hearing about us, you might want to go back and check
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  out a couple of the previous episodes because we're going to
• 0:26
  give you a much easier path to success if you're feeling some
• 0:29
  of the problems we're going to talk about in this episode. In
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  episode one, we talked about the life cycle, we talked about the
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  leadership styles, and we talked about really the only good
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  reason for ending up in that this third stage that we call
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  whitewater, and you don't want to end there for any reason
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  other than the reason that you have to, and that reason is
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  because you have you've operated so well that you've created so
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  much success that the complexity from that success has thrust you
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  into the whitewater stage, and if that's the case, you need to
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  add some systems and processes to how you make decisions as an
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  organization, and that's what's going to help you get to
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  predictable success, where you can scale. And this is all based
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  on the predictable success model from Les McEwen. In the three
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  episodes that followed, we talked through the three
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  categorical errors that organizations make in the stage
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  before that, in the fun stage, that causes them to end up in
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  whitewater prematurely, and you don't want to do that because if
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  you do, you end up in this really gnarly stage where you're
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  making a bunch of mistakes, where there's infighting on the
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  team, where you're losing confidence as a leader, where
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  profitability drops, all the bad things, lots of bad things. You
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  end up in that stage twice as long. It's twice as hard to get
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  out, and it's going to cost you twice as much to do it. And so
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  we want to avoid those as much as we possibly can. And the
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  answer, if you end up in any of those categorical errors, is to
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  try and unwind it to get back to the fun stage, to simplify, and
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  then to refine refine the system so that your operators can
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  succeed. That's fundamentally the same pattern in every single
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  one of them, although the root is a little different. But here
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  in this lesson, I want to talk about your other choice because
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  you really do have a choice when you're in the whitewater stage,
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  whether you did it by default or by design, you're left with a
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  choice. The only thing that you can't choose is to stay in
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  whitewater. But the two things that you can choose are to go
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  back to fun, which is what we've talked about in these last three
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  episodes, or you can drive forward into predictable
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  success, and so what I want to talk about in this episode is
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  for those of you who are either a glutton for punishment, really
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  like to do hard things just because they're hard, or are in
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  some type of a situation where you have to move forward to
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  predictable success, and I want to talk about what those are and
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  what you would do about it. All right, so let's look at this.
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  Why would you have to get to predictable success even if you
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  have an imbalanced team? So if you're overvisioned and need to
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  get to predictable success, or overprocessed or over
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  synergized, well, oftentimes it's because of things that are
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  happening outside of the organization, or promises that
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  are made outside of the organization, and so when we
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  look at organizations that are overvisioned, that have to get
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  to predictable success, the most common reason why is because
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  they've made commitments to outside stakeholders and they
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  have to fulfill them. Again, this is the primary challenge in
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  tech industries, especially the venture-backed tech industry, is
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  that we we hyper invest in these early stage organizations
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  expecting huge returns. Which means that if you're going to
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  survive as an organization, it's you have to knock it way out of
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  the park and then maybe even out of the stratosphere, or you
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  disappear.
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  Those are organizations that have so much investment that
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  they can't actually stay in fund because they would never be able
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  to pay the investment back. So they have to get to predictable
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  success, and they usually have to do it pretty quick. An
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  overprocessed organization that has to get to predictable
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  success is usually one that the process isn't just the the
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  nature of the founder or leadership team, but it's a
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  necessary underpinning for the industry. Some examples of this
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  are like financial services, especially these days. There are
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  so many rules and regulations that you almost have to have
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  processors in the mix pretty early, and and so some of you,
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  if you're trying to scale a firm in a space like that, attorneys,
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  similar thing for attorneys. Sometimes you have to have a lot
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  more process than would be ideal for the fund stage, and we have
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  to figure out how to scale anyway. How about synergists?
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  Well, if you're in the nonprofit space. It kind of comes with the
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  territory. Most of the people are going to be attracted to
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  working in a nonprofit. Generally, want to do it because
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  they want to help other people, and so you might find that in a
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  nonprofit or in a super customer service heavy industry like a
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  concierge service, for example, you have to have a lot of
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  synergists just to do whatever it is that you do to be a
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  concierge. You need a lot of that people orientation, and so
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  there will be circumstances when you don't have the ideal mix,
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  but you still have to get to predictable success anyway. And
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  what I want to talk about is how you can do that, or at least
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  give yourself the best shot of doing it because there's no
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  guarantees. You're in for an uphill battle, one that can be
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  won, but you have to recognize that it's going to be a
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  challenge. Fundamentally, what you need to do is you need to
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  fight on a couple fronts at the same time. The first thing that
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  you have to do is you have to really fight for your operators.
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  So again, if you're in, we'll go back to the concierge service,
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  and and you've got a bunch of synergists around, and they're
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  driving your operators crazy, and maybe even driving them out
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  of the organization. You cannot sustain predictable success
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  without enough operator. It it won't happen. You have to have
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  all four styles in predictable success, which means you need to
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  have operators. So it's you have to start by fighting for the
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  operators that you have, and trying to make sure as best you
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  can that you have that operator voice as part of your decision
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  making process. Now the obvious way to do that is to add an
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  operator to the team, but that's not always a possibility.
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  Sometimes you don't have them. Sometimes you don't trust them.
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  There are many reasons why you might not be ready for that or
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  able to do that. And so, what we want to do is we want to use
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  something called the designated driver strategy, and that is
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  where we designate somebody in the meeting as our operator for
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  the meeting, right? It's not the same person every time because
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  we don't want someone to be pigeonholed into that role,
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  especially if it's not their strong suit. But if we share
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  that burden as a team and we kind of rotate it through and we
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  say, you know, Jimmy, you're our operator for today's meeting.
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  You good with that? Jimmy says yes, and Jimmy just sits there
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  and thinks, hey, what would an operator say in this situation,
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  now Jimmy may be skilled, Natty may not, but that is a skill
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  that you can develop as a team: is to try and see the challenge
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  that you're discussing through the lens of an operator, through
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  the eyes of an operator, and so that's a really helpful way. If
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  you can't get someone on the team, then try and get someone
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  who's already on the team to to carry more of that weight for
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  you, and the best way to do that is to alternate it and cycle
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  through the different members. One of the things that you'll
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  find, and a quick plug for our team leadership styles
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  report-it's a great way of figuring this out.
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  But one of the things that you'll find is that you might
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  have folks on your team who aren't operators. It's not like
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  they're strong suit, but that they do have that operator trait
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  in them. It's blended in with something else. Those folks make
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  great designated drivers in the the VOPS format of that. The
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  visionary operator processor synergist, not trying to get
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  home after a fun night. The next thing that you need to do, and
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  and these are really simultaneous. They're
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  overlapping, which is what makes it so hard. Is that you also
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  have to recognize what the systems and structures you are
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  you need to overcome the complexity that you face, which
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  is going to be a lot. And what we have to do is recognize that
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  the systems and processes that the industry demands are
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  generally not the same systems and processes that scale
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  demands, and this is why in very processor-heavy industries you
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  don't see a whole lot of big organizations. Actually, a
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  better way of saying it is you don't see a whole lot of
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  mid-sized organizations because you're either really small or
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  you get really big, and the reason for that is because
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  navigating the space of getting the right systems and processes
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  that don't chase your operators away, that meet the industry
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  need, and then adding the system and process that's necessary for
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  scale is pretty tricky. There are five key areas that this
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  happens, and they are in your organizational structure being
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  really clear, the way that you make decisions being really
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  clear, the way that you integrate sales and the other
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  functions of the business that are necessary to deliver value
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  for your client, we call that cross functionality. You have to
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  have not just have a mission, vision, values, but you have to
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  be able to align every action in the organization with your
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  mission, vision, values, and you do that through clear tactics
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  and clear strategies, and then finally you have to have a
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  mechanism for empowering decision making throughout the
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  organization, not just from the central team. Les goes over all
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  five of those in his book, Predictable Success. We've got
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  something called an acceleration program for those of you who
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  want to implement. All of our scale architects are highly
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  trained in those five areas and can help you to to figure out
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  which of them is most relevant for you and your organization.
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  So, check out one of our scale architects in the directory and
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  ask them about an acceleration program. They'll be able to help
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  you out. And what that acceleration program will do,
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  what again, the Predictable Success book will do is help you
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  to recognize the difference between the industry procedures
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  that are necessary and the systems and processes that you
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  need for scale. And again, you have to walk the tightrope of
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  freeing your operators as much as possible while staying within
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  the industry procedures and adding system and process
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  outside of it is not an easy thing to do, but because it's
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  not an easy thing to do, generally the rewards of doing
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  it are astronomical. If you can get through adding all of that
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  system and structure we talked about and still have quality
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  operators in key roles, those are organizations that achieve,
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  you know, to some extent, like hyper predictable success. This
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  is where you've got the blend of processor and visionary, and the
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  operator holding that all together and driving it forward.
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  You can see some extraordinary results from teams that figure
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  this out. Extraordinary results. It's really really cool, so it's
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  worth it if you can get all the way through, and that's just the
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  cost that you have to count before you you really go at it.
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  The next one is the the over synergized organization. So if
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  you're an over synergized organization and you need to get
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  to predictable success, what would a good example of this be
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  so? I've seen this happen for for a nonprofit that gets a
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  gigantic grant. Right, they've been plugging along at about a
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  million dollars a year, and then they get a $10 million grant
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  given over you know two years or three years, and it's just like
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  we've got to we've got to deliver on this because there's
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  $100 million grant behind it if we can deliver, and like you
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  have to go from zero to 1000 like overnight.
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  You gotta go, and you've got a bunch of people who aren't used
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  to that. They're not used to that pace. They're not used to
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  that speed. They're not used to the corporateness. They're not
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  used to the accountability. They're not used to the
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  pressure, and it's a real challenge. Well, again,
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  similarly, what you have to do is make sure that you optimize
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  for the operators that you have, like we talked about earlier,
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  and especially so because being super synergistic is very likely
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  to alienate your operators. So one of the things that I would
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  encourage you is usually what happens in this circumstance is
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  that you're adding a bunch of people, and the first thing that
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  you want to do is use that org chart stuff that we talked about
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  earlier, the organizational design, and design it with
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  operators in mind, not just the synergists that you would
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  normally know and like and hire. And instead of creating a hiring
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  process to bring in a bunch more visionary synergists like you,
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  try to create a hiring process that attracts operators as well.
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  Really, really important. Create roles in which operators can
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  thrive, so that when you scale up, you bring in operators. You
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  get a bunch of folks who get stuff done. You can actually
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  deliver on the promises you made that led to the reason you need
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  to scale up in the first place. And then it's the same areas
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  that we talked about earlier. It's the organization design.
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  It's how we make decisions. In fact, usually for synergists,
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  it's getting beyond consensus and this kind of over focus on
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  buy-in and actually moving it to where the smallest number of the
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  right people can make decisions as quickly as possible, as
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  opposed to the greatest number of everybody as possible. And
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  so, in all of these, what has to happen is you have to focus on
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  those big five areas, right? And you have to increase the
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  operator style. And generally, what that means is decreasing
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  whatever other style came in at the same time, and the problem
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  with that-the real problem with that-is not actually tactical in
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  nature at all. It's cultural in nature. The hardest part about
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  having to do both of these things at the same time is that
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  you have to-you have to, to some extent, rewire your culture to
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  fully embrace operators, while also going through the process
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  of rewiring your culture to embrace processors as well,
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  while also implementing all these systems and processes,
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  while also continuing to try and grow, it's just a lot all at the
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  same time. And for those of you who are in that position, and
• 14:39
  really anybody, we'd love to help anybody, but for those of
• 14:42
  you who the stakes are that high, I would highly recommend
• 14:45
  that you don't try to do it alone because you can get
• 14:49
  through, but it usually takes about three times as long when
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  you're trying to figure it out on your own as it would if you
• 14:56
  had a guide that would help you through it. And so, I don't want
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  to make this a sales pitch that's. What it's about all the
• 15:00
  time, but for those of you in the highly unenviable position
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  of having to plow through and get to predictable success
• 15:07
  quickly, even though you don't have the ideal combination to
• 15:11
  get there, I would strongly encourage you to find some help.
• 15:15
  Get a guide. Get a skill architect to come in and help
• 15:17
  you out, and it's going to make a huge, huge difference because
• 15:21
  you won't have to guess how to grow. You can bring someone in
• 15:25
  who's got the skill, who understands how these are, who's
• 15:27
  done it, you know, hundreds or 1000s of times, who's seen the
• 15:31
  patterns, who knows how they play out, and can help you to
• 15:33
  avoid some of the biggest pitfalls. So check out our
• 15:36
  directory. We've got lots of great scale architects all
• 15:38
  across the country. In fact, we've even got some around the
• 15:41
  world that you can check out, and they'd love to help you out.
• 15:45
  They'd love to help you out. And with that, I hope you learned a
• 15:50
  lot about Whitewater. I hope you. I hope many of you realized
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  you didn't actually have to be in Whitewater, and that you've
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  got plenty of time left in fun. That that really is my deepest
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  hope.
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  And for those of you who realize, hey, we really are in
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  whitewater. We've got enough people around here. We've got
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  enough on the line that we have to do it now, and I really mean
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  have to do it now. I hope you've got some insight into what that
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  road's going to look like, how to start addressing it both
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  culturally and tactically, and and I hope you get the help to
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  do it as well. So with that, I want to thank you for going on
• 16:24
  this journey with me as fun little project. This is
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  something that I'm seeing a lot of. The reason why I wanted to
• 16:30
  take some time on this and really make a series of it is
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  because I'm finding most of the people who think they're in
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  whitewater are actually not there by necessity. Most of the
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  people that I'm finding in Whitewater actually don't have
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  to be there, and that might be the case for you as well. And
• 16:48
  so, with that, I hope this was helpful for you. I hope you
• 16:51
  enjoyed this little series. I hope it was interesting. I hope
• 16:55
  you learned something, and more than anything, I hope you have
• 16:58
  confidence in the next step that you need to take for your
• 17:02
  organization to achieve your vision. With that, you know your
• 17:07
  time and attention mean the world to us. I thank you so much
• 17:10
  for sharing that with us, and I hope you enjoyed this series. I
• 17:13
  can't wait to see you next time. Take care. Hey everyone, Scott
• 17:20
  Ritzheimer here. Thank you so much for listening to the Start
• 17:23
  Scale and Succeed podcast. I hope this episode gave you
• 17:25
  exactly what you need for the level you're in right now. If
• 17:30
  you want to discover what level you're in, take our 10 question
• 17:33
  Founders Evolution Quiz for free at foundersquiz.com. That's
• 17:38
  foundersquiz.com. It'll pinpoint exactly where you are and give
• 17:42
  you tailored tips to move forward and reach that next
• 17:46
  level in your journey as a founder. If you got something
• 17:49
  out of today's episode, don't forget to subscribe, rate, or
• 17:52
  review. It helps us reach more founders like you, and let's be
• 17:56
  honest, it means a ton to me, my team, and all our incredible
• 17:59
  guests. So keep starting, scaling, and succeeding, and
• 18:03
  I'll see you in the next episode.