Episode 55 Podcast Transcript
Speaker 1 (00:00):
Then once you know that you’ve set them up for success, build the processes around that position and then you just rinse and repeat. And that’s how you go from 1 million to 1.5, to 2, 2.5, to 3 to 4 to 5 and beyond. Hi everyone. Rob kropp and Dan Stones here from Pravar Group and welcome back to another episode of The Trade Den, welcome back Dan.
Speaker 2 (00:26):
Thanks Rob. Hi everyone. Yeah, great to be back. Looking forward to another cracking episode.
Speaker 1 (00:31):
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Speaker 2 (01:03):
Yeah, absolutely. What we’re going to do today is really undo the idea of what is a common approach and the common approach we see in this regard all the time is that people will put people, sorry, and the common approach that we see is business owners putting people first, then probably process and then position. It’s those three Ps people, process and position that we’re going to be working on today. And Rob, I think that common approach, maybe break that down to start with what is it about when you go people process and position that starts to cause some pretty big problems.
Speaker 1 (01:34):
Yeah, I think what happens is most business owners, they hire people first and then they figure out the processes afterwards and then they work out that there’s got this whole complexity within their business and then they try and build structure around it. And what they’re actually doing is building things backwards and it’s creating more problems than it’s actually fixing.
Speaker 2 (01:58):
And I think you hit it there with the problems it’s fixing. And I think this is where the initial hiring phase of most business owners comes from a point of view that they can’t cope by themselves anymore or they’ve reached a point where they’ve got too much going on or there’s a fire that needs to be put out that they can’t do it alone. So the higher happens, I’ve just got to get people in as their primary concern and that might work in the short term, but it doesn’t do anything in a long-term sort of success for the business. There’s a right order to doing this that can prevent the chaos, the misalignment, and trying to find people that can do the superheroes we talk about or unicorns in the case of what we teach.
Speaker 1 (02:36):
Yeah, I think we’ve spoken around in previous episodes, so many business owners understand that they’ve got to create leverage and leverage comes in the form of money people and also systems. And so what we’re talking about today is an element of them, but most business owners have this understanding that they’ve got to be able to leverage their time through people. And so that’s what they do. They’re like, okay, I’ve got to get more time back, let’s go and hire. And so they just go out there and hire someone and they think that putting someone or a person into the business is going to fix their problems, but it doesn’t creates more problems if you don’t get it right.
Speaker 2 (03:15):
And what happens then when you do get it wrong? Before we get into what’s the right way to do this, and I promise if you’re listening, we will get to that today. There’ll be some concrete things there, but let’s talk about what happens when you do get it wrong. I think it’s important for people to be able to recognise if they’re halfway down the path that they need to course correct from.
Speaker 1 (03:34):
Yeah. The first one is that they put square pegs in a round hole and so they might have the right person, but it’s the wrong position for that person.
Speaker 2 (03:47):
So what do you mean by the wrong position for the right person? If it’s the right person, shouldn’t it mean that they should be able to get around that and should they be able to overcome the challenges of that role even though it’s not perfect?
Speaker 1 (03:59):
Not necessarily because different people have different strengths, different weaknesses and different ways of handling certain situations. And if you think about, I’ll use two scenarios, think about, I’m going to use a real estate agent for an example is someone’s either a really great salesperson or they’re a really great property manager. If you ask a property manager to go and do sales, they’re going to fail every time. And if you ask a salesperson to manage tenants and relationships and properties, they’re going to fail every time. So even though we use someone as a real estate agent, as a person, if you put that one person in the wrong environment, they’re going to fail every single time.
Speaker 2 (04:44):
The frustrations are going to just get bigger and bigger. The performance is going to suffer. You’re not going to be happy as a business owner, they’re not going to be happy as an employee. And before you know it, you’ve wasted, I don’t know, six months and they’re out the door and you know better off than where you were to begin with.
Speaker 1 (04:57):
Correct. Let’s use an example. Now let’s dig into, that’s the more obvious one. Now let’s think about a trades business. You’re whining yourself off the tools and you need someone in the office to be able to help you out. You go and hire a generalist, and that generalist in the admin function is probably either going to lean more towards being a bookkeeper or they’re going to lean more towards being an admin person. And if you ask someone who’s more administrative focused and you ask them to be bookkeeping heavy, they’re going to make mistakes. They’re not going to gravitate towards the numbers.
(05:33):
They’re going to get the transactions wrong. They might get the coding incorrect. They’re not going to follow up on data management and everything because it’s not what they’re good at. And the other side of the equation, if you try and put a bookkeeper in a admin function, they’re always going to gravitate towards the numbers and they’re not going to be on the guy’s backs around job cards, time sheets. They’re not going to be ringing suppliers because they’re more of a back office numbers person. And so there’s a great example in a trades business where it’s like, okay, I need someone in the office to be able to help me out. You just go and hire Mary down the road, but she’s a good person, but you hire a great person but not the right person for that position.
Speaker 2 (06:15):
Yeah, that makes sense. I think the other part of this that I see in coaching all the time with guys is that they haven’t defined the role well enough anyway. It’s the right person, but the role isn’t even clear. They could be good at it, but no one really knows what the measure of success is, what the requirements are, what are the responsibilities. It just makes it really hard. So it’s not so much a round hole, it’s just that you dunno where the hole starts and finishes.
Speaker 1 (06:40):
Yeah, correct. And what happens is this is where frustration happens from their behalf and your behalf. They’re frustrated because they’re not doing things that they don don’t like. They don’t prioritise things like you expect them to. You get frustrated because there’s mistakes or issues or whatever it is, and there can be all this frustration going on and is that their fault? Well, maybe, but this is where as leaders, we’ve got to face the facts and really it’s our fault because we’ve hired first and put a person in the position before we’ve got clear on the position and then hired a person for it.
Speaker 2 (07:20):
And what happens is this next thing when you get it wrong, which is creating chaos and complexity, you have what you’re talking about overlap, confusion, the lack of accountability. You can’t hold someone to account because they never really knew that was part of their role. All of these things that we see all the time. But what you end up with is a situation where the fire you thought you were going to put out is effectively growing by the minute.
Speaker 1 (07:40):
Yeah, it actually adds, like you said, it adds complexity and there’s this chaos going on the business, things don’t get easier. Things actually get harder. And now this, like I said at the start is now you’ve got a bigger payroll, more expenses. Now you’ve got to try and manage someone and the problem’s not going away because you are having to feeling like you’re working in a kindergarten. We hear so many business owners say that if you’ve got a kindergarten and you’re trying to manage all these kids running around, it’s probably because you’ve hired people without being well considered around what position they’re actually going to fulfil before you even put that person on.
Speaker 2 (08:16):
And this leads on to the next knock on. So if I’m running a kindergarten, you know what I need? I just need better people. I need better people who can fix this system that’s busted and I’ll get the best people I can find. Now we’ve got a special way of talking about this and we’re going to talk about this in terms of a unicorn hunt. So do you want to enlighten everyone to what we mean by unicorns and unicorn hunting?
Speaker 1 (08:36):
Yeah, A unicorn is that mystical person where you might’ve hit jackpot when you hired your first admin person, for example, and she was just amazing. She came in and she had all these skills and experience and maturity like we teach in coaching, high for skill, high for experience, high for maturity. This lady came in and she just solved all your problems and she did everything from the administrative side of things, and then all of a sudden she decides to move onto to another job. Or maybe she’s moving in state and then it’s like, oh shit, Mary’s, Mary’s leaving. Mary’s a bit of a unicorn. Oh no, we’ve now built a role around Mary. Oh, how do we now go to the marketplace and hire another Mary? Oh shit, there’s no more Mary’s out there. What do I do? And this is where the problem comes because you’ve built a role around a unicorn and it’s very, very hard to find another unicorn out there in the marketplace.
Speaker 2 (09:35):
Absolutely. They’re rare, they’re expensive, they’re so hard to find and you waste so much time. So yeah, it is a real thing. We deal with this a lot. I think this is where we’ve got to then in terms of what that process, as I said, the common approach is this, right? There’d be a lot of people listening nodding their head going, yeah, I’ve done this before. I think we all have in our experience when we first started, where we go people process position, that’s really where we’ve been so far. And that’s the common thing. Do you want to talk us through the fix? We’re going to use the same thing. We’re going to talk in terms of the same three Ps, but what’s if you like, the right way, the recommended way, the way we coach it, however you want to say it.
Speaker 1 (10:12):
The right way, is position first person second, processes third in that order. So you always get really clear on what is the position that we want to be able to fulfil. We define the role to purpose and what success looks like, and then we go to the person second and we look at getting the right person that fulfils that position successfully. And then when that person is in there, then we build processes around that function and around that person to be able to ensure that we’ve got contingencies and sustainability in that person being in that position.
Speaker 2 (10:55):
Nice. I like it. So position, people, process. Let’s break that down because there’s plenty to discuss here. I can’t wait to get into this position. First, we’re going to define the role, its purpose, what success looks like and why is that so important?
Speaker 1 (11:10):
Let’s talk about this in two instances. Let’s talk about ground crew and then we’ll talk about operationally.
Speaker 2 (11:17):
Let’s do it
Speaker 1 (11:18):
In launch. We have a framework which we call our crew designer, and that’s your ability to be able to unpack your crew. What are the positions between leading hand tradesmen, apprentices, we understand who’s who in the zoo at the moment, where are we now? Where are we trying to go? What are the gaps that are missing? And instead of just going to the marketplace to be able to go, let’s just hire any tradesman, what we’re actually doing is getting really strategic in who to hire when based on what the business needs now and where we’re going rather than just taking anyone off the street.
(11:56):
I got a great example for this is Matty who runs a plumbing business based out of Gold Coast, and he went through this process actually very, very recently and he, as everyone knows it’s very, very hard to find good tradesmen on at the moment, and he put a seat out, up chasing a plumber and he had some good applicants. Then he went through this crew designer phase and he’s like, actually, I don’t need just a tradesman. I need a tradesman who can quote and sell. And then once I get that right, I actually really need a good apprentice. And so when he went through this process, he actually found two good tradesmen, but he actually had to say no to them and that hurt him. He is like, I’m actually turning away two really good tradesmen because they’re not the right tradesmen for what we need right now.
(12:55):
And then he was able to change tact, go back to the market, find a selling plumber. He then went and found someone. Then he went and realised that he needed an apprentice to balance out his ground crew, went to the market, found a good apprentice that got what the business needed right now, now he’s in the position that he can go and find a general installation plumber, but his story is so opposite compared to most where most just go to the marketplace and grab what they can find and generally pay overs. But in Matty’s example, he strategically worked out what he needed, what were the positions, then he went to the marketplace to find the right plumber to fulfil that position in his ground crew.
Speaker 2 (13:39):
Have those guys started with him yet?
Speaker 1 (13:41):
They have.
Speaker 2 (13:42):
And what’s been the result of those guys coming in and how’s Matty been as a result of unloading two more people as opposed to even one?
Speaker 1 (13:49):
Well, because he’s in that nature of the business in the B2C space, he’s now got a plumber who is actually quoting and selling work. If he had have gone with the tradesman, he would’ve, Matty would’ve expected this guy to sell and he wouldn’t have. And so he would’ve blamed him for not working, not performing. And he then realised that he actually needed apprentice to be able to balance his ground crew and also bring his average labour cost in correct order. So by getting the selling tradesmen and then secondly getting the apprentice that fixed the root cause of the problem, now he’s able to go to the marketplace and regrab one of those tradesmen who can then instal the work that the selling tradesmen can actually win and get across the line.
Speaker 2 (14:39):
Yeah, absolutely. And that came from the clarity of the role that he needed. He wouldn’t have had that if he didn’t spend the time to get clear on the position first, he would’ve gone down that path and what would’ve happened, he would’ve had a position, like you said, there’d be a bottleneck in there somewhere. There was no sales happening. We’ve now got a bottleneck because we’re not seeing the amount of work we need to, even though we’ve got the people in.
Speaker 1 (14:59):
Correct, and he would’ve brought on a tradesman, six months would’ve gone down the line. That guy would’ve been unperforming. He would’ve got the shits because he was expected to do a role that he didn’t want to do. Matty would’ve had the shits because he would’ve had to performance management because he wasn’t doing it. The problem wouldn’t have gone away, it just would’ve been kicked down the can six months later he would’ve had to punt him and start the whole recruitment process again.
Speaker 2 (15:22):
Yep, absolutely. So that’s a really good example. I love that that’s position first. That’s why we go position first for that sort of clarity and replacing the chaos that you choose when you do it the other way or you bring in the unicorns we just talked about.
Speaker 1 (15:34):
The next example is at the operational level is the same thing when you’re making those moves around, really starting to leverage your time from your office crew for example. You’ve got to really make that decision whether if you’re going to go down the line of getting a bookkeeper or an administration person, and generally they’re two separate positions generally. Sometimes your admin person can do some of the bookkeeping function, but the clearer you get on the role, the responsibility, what they’re going to be actually doing and who you want to hire and what they’re going to be responsible for performing in their role, what it helps you do is to have so much clarity. Then it gives you that ability to go to market and recruit the right person. Then when you see that seek ad, it’s like that’s the person, that’s the person that I know that we need for this business.
Speaker 2 (16:27):
And you see this all the time when you’re doing the interviews, you’ll never have, I’ve never experienced it. And in coaching guys when this happens, it comes up a lot. They come up with, I’ve got a story, there’s a decision to make. I’ve got a decision, I’ve got these two people. I’ve got the one administrator who’s great, they’ve got the experience in running jobs, they’ve been in the industry before. Then I’ve got this other administrator who maybe not as much experience, but they could also do a bit of bookkeeping for me. And it’s always the way you’ve got to pull that apart and go, well, what role do I need? But you’ve got to be able to understand that no matter what side of the fence the administrator falls on, they’re always going to sort of big up their skills to an extent because they think that people are going to value unicorns and a lot of people will. So that’s how they get jobs. So the administrative person will say, yeah, and I can do a bit of bookkeeping, will have no interest in it, do a terrible job and lead to frustration and chaos. The administrator who’s the bookkeeper will do the same thing and go, no, I can absolutely do a bit of administration won’t really water, her heart won’t be in it and you won’t get what you need. So you’ve got to figure out what you need first in this instance.
Speaker 1 (17:28):
Correct. And it’s really important to remember that if you put enough emphasis into defining the position to begin with, the position dictates the recruitment process and it dictates the person when you’re going through the recruitment process. And we’ve seen it before. I remember speaking to a client at the end of last year, he rang me like you were talking about before. He is like, Rob, I found this amazing person. I think she’s going to be the best fit and she’s got all this experience. She can do this, this, this, this and this and this. I’m like, well mate, let’s go back to the position. What are you looking for? And he had to have that face the facts moment where it’s like I’ve actually got to say no to her even though she’s amazing. She’s ultimately going to be the wrong person for that position and that just would’ve created a problem six months down the line, you just would’ve been kicking the can down the line and wouldn’t have fixed the root cause of the issues.
Speaker 2 (18:21):
And I think the message you’re giving here is that it sounds like it, it’s counterintuitive to an extent, but it becomes easier to recruit and retain employees. It becomes easier to do that when you’ve got this clarity when you’re hiring based on position and not just talent alone.
Speaker 1 (18:36):
Yeah, correct. And so when we talk about person second, the recruitment of the person always comes after the clarity of the position to begin with. Because then you can write the seek ad in a certain way. So let’s administrative wise, if you know that this is the role and responsibilities of the person, you craft your seek ad that talks to that position and you call out that person with these strengths and this experience and what they’ve done before and have they worked this many years in admin and have they worked in a trades business and maybe they’ve done experience in job management systems and all that kind of stuff. If you know that that’s what they’re going to be doing on a day-to-day basis, you can craft your whole recruitment campaign around that position and you call that person out and then it’s like, oh, amazing, this person showed up in my recruitment campaign and here they are kind of thing. So that’s why we always go person second after position first.
Speaker 2 (19:34):
Yeah, it’s about having everyone fit their role by design, not by luck. That’s really’s really what we’re aiming for. It’s not luck, it’s not just hey, well of course they can do that job because they’re paid way over and I’d expect that they should be able to do what we need them to.
Speaker 1 (19:46):
Correct.
Speaker 2 (19:47):
Alright, let’s go to the third one, which is process. So we’re doing the correct phase here, so we’re on position first, people second process third, talk me through process third and how that fits in and why process comes at the end of this train now.
Speaker 1 (20:02):
We always do things a little bit different here at Pravar. We are different and I would like to say unique, special, thank you. There’s plenty of other, the school of thought on other sides of the fence is let’s get in there and do systems and processes upfront and you’ve got to implement these checklists and this flow chart and get this job management system in and everything. When we are dealing with a business that’s doing between $1 and $2 million for example, going straight to processes and systems is the worst thing you can do.
Speaker 2 (20:40):
Why is that?
Speaker 1 (20:42):
Number one is you don’t have time to be able to implement the processes to begin with. And number two, the owner is generally the worst person to develop systems and processes. True. Why are you laughing when you’re looking at me?
Speaker 3 (20:59):
I’m trying not to. I’m trying so hard not to, but I’m just carry on. It’s all good. We’re not talking about our business specifically, we’re talking about clients, so carry on. Cool.
Speaker 1 (21:08):
Thank you Dan. Most tradies for example, they’re very good at their hands and building stuff, but when it comes to job management system implementation, do you think they have the propensity to want to sit there and roll out a job management system and get their head around the technical implementation of a bit of software?
Speaker 2 (21:29):
They don’t, and you see this so often the pains and we see it play out. If you’re sitting on a job management system that you purchased 12 months ago and you’ve been paying your subscription fees and someday I’ll get around to it and then when I’ve got that in place, I’ll then go out and hire the people I need to operate it or we’ll get this one thing set up. It never happens and that’s because of all this stuff that you are mentioning, the time investments more than what they can afford, the skillset’s not there that they need and the inclination to do a good job of it, just there’s no interest to pull them into the task to see it all the way through to completion.
Speaker 1 (22:01):
Correct. And the team’s not big enough to worry about all the flow charts and the systems and all that kind of stuff. Our systems and processes important. Absolutely, but they’re important at the right time in your journey in business and I think that’s the punchline that we’ve got to hit home today.
Speaker 2 (22:16):
It is, it’s important. And people, I think also the other punchline is people use this as an excuse when I’ve got the processes, then I’ll go down the path of hiring or then I’ll have the heartache of trying to bring people into my business and I’d challenge everyone that’s listening to have a real face the facts moment and say, are you using processes that aren’t there as an excuse to going down the path of defining a role and then recruiting and retaining good people? Because if you are, then you’ve got to call that out. You’ll never get past that. The process won’t happen, the people won’t come and you are really dooming yourself to stay on what we call the hamster wheel.
Speaker 1 (22:49):
Correct. And I think when you’re in that zone, especially when you’re in the early parts, you said hamster wheel there, the hamster wheel zone is around that $750k, $1.5m to two-ish million dollar market. It’s that one and a half million dollar bracket we call the hamster hamster wheel zone. And the reason why you go, I believe you go position first person second is you get off the tools, then you’ve got time to develop systems around how you want to run jobs on site, so get off site and then you develop systems to make it more efficient. Then you get in the office and then you get clarity on the position, hire a bookkeeper and work with your bookkeeper to develop invoicing and data management systems for example. So you leverage off that expert’s skillset to be able to get them to help you develop the system around how they do things. And so instead of you busting your ass at nighttime, you’re just trying to keep up with the invoicing, let an own developing system so you’re better off leveraging back your time by getting the person in there, the right person, and then you work with them and get them to develop systems alongside you and that’s how you get to improve your business along the way rather than you feeling like you’ve got to develop all the systems at the start.
Speaker 2 (24:12):
Yeah, absolutely. We talk about systems champions in this regard. A system champion is someone that’s going to come in and they’re the quarterback of that part of the business. They’re the quarterback for having that system implemented. You’ll have input for sure, but they’re the ones that are the systems champion or the process champion in that regard.
Speaker 1 (24:29):
Correct. And let’s think about the administration function. Get a really good admin person who’s come from the industry, got that industry experience, they’ve got skills, experience and maturity in this space. Hire someone who’s worked in another trades business, who’s worked with job management systems and all those types of things and get them to come into your business because then what they can do is bring that experience into your world and they can help you roll out systems and processes around the way that you track hours and implement your job management system and roll out your systems around dealing with suppliers and customers really work with them. And this is how then business evolves and changes and improves rapidly is all of a sudden now you are working on improvements, your bookkeeper’s working on improvements, your admin’s working on improvements together, we’re all working on stuff rather than you trying to do this at 11 o’clock at night where you’re just trying to do doing.
Speaker 2 (25:29):
When you’re busted, everyone’s yelling at you to get back to the house, all this sort of stuff. Absolutely, and I think is why this is such a big topic because this is, if you look back on it and if you’ve listened along the episodes, nearly every story you tell starts with someone offloading LVTs or low value tasks to their administrator. Now what we don’t hear is how long that business owner wrestled with this stuff before they got that person in and they actually got this process the right way. But I’d be interested to hear from you the level of importance to getting this journey that people go on with us. How much of the 80 20 rule applies to just getting this process and this order the right way around with getting people in first and process second.
Speaker 1 (26:10):
The most important thing because when you’re trying to grow a business, who to hire when is the most important strategic plan and path that you can follow when growing a trades business? And there’s a real recipe for it. If you’ve listened to all the case studies that we’ve shared on this podcast, there’s a formula to be able to follow around how you start with your ground crew and get that right move into your office crew between admin and bookkeeping. Then when you’re at a certain size, you move into project manager, then you move into your estimator. So there’s a real formula to follow on who to hire when you hit a certain point in business and so you don’t have to chance it or go by luck. You’ve just got to follow the recipe, get the position right person then, and then you do all the grunt work of all the processes and systems along the way.
Speaker 2 (27:04):
And that’s when people become that, that’s where they go. And then everything took off from there. But it’s how quick can you get to this realisation and follow through on this that’s going to determine how quick you move, not sort of the person you bring in or even ultimately what processes you build. It’s about the structure and the way you approach strategically hiring and building your structure. That’s the real, the secret source to all of this.
Speaker 1 (27:28):
Correct. And when you see, we talk a lot about this in coaching around businesses that grow broke and the reason why a lot of businesses grow and implode is because they outgrow the owner’s ability to lead that team, number one. The second one is they outgrow operationally their ability to deliver that work effectively, and then third, they outgrow, they grow too fast and the team can’t keep up with that trajectory of growth and compare that to clients who sound slow in some degree, where we always say slower growth is good growth. Where we would rather a client go from one to $2 million and they take 12 to 24 months to do that and they spend two years getting off the tools, systemizing the delivery of jobs, getting in the office, getting an admin and bookkeeper, systemizing the pricing, the job management, the scheduling, the job management system. Then they move into operationally get a really good PM and don’t rush that and spend time setting that PM up for success because how many times have we seen it where they put a PM on and they move onto the next thing and then that PM fails?
Speaker 2 (28:52):
Yeah, we talk about putting just names in a box. Anyone can put a name in a box, anyone can go off and hire anyone really. You could say, yeah, I’ve hired that. Look at my structure. It looks great on paper, but when it doesn’t work, it creates absolute turmoil for the business.
Speaker 1 (29:05):
Correct. And so if we can get this formula right of position first person second processes third, and take your time at getting someone in, implementing it, creating the structure around it, then moving on to the next piece, this is what builds a good long-term sustainable business that’s going to endure the good times and the hard times.
Speaker 2 (29:23):
Yeah, a long-term sustainable business when we define it, more profit, more time, more freedom, all the things you look after, that’s how foundational this process is.
Speaker 1 (29:35):
Where’s an example where you have seen it where a business has grown and it grew too fast, and what was the outcome when that happened?
Speaker 2 (29:50):
I’m seeing it at the moment with a couple of businesses actually, and I think as we deliver on our promise to guys, it’s something that’s a reminder for us as well, but guys that take the opportunities and the learnings they’re having personally, their mindset grows the expansion that, Hey, I can build a business. You can, and we’ve seen it at the moment where people start saying yes to opportunities. So as people start to grow and they go on their journey and they start to, their mindset improves, their capability to manage improves and lead improves, all these opportunities start to open. And where people start to grow then is they take on more responsibility now capable of handling it, but without the structure in place with the wrong people in place or the roles aren’t well defined, they can throw all of that over the fence into the operational part of the business or into the ground crew or the office crew. And what ends up happening, like you said, they can’t cope. There’s no mechanism for that to get through, wash through the business as a completed job, as a profitable job, and therefore all these other things that flow as a result of doing business well, of operating your teams well, all of that’s still falling by the wayside because you haven’t got the scaffolding underneath you to deliver on what you’re now capable of as one individual.
(31:04):
And when we see that happen, it in a way it’s good because the owner has to understand that sort of process, but in a way it’s sort of heartbreaking like, well, I’ve done all this work, I can do it, and now I’m still getting punished for it. And I think the hard thing for people to wrap their heads around is the lesson that it brings in. And the fact is that just because you can doesn’t mean you should. And I think that’s a real, if you can get that lesson beforehand and keep it as a rule in your mind, it’s way better than, Hey, this is the hard lesson that I had to learn. It can add up really quick growth at this level, especially in B2B trades businesses, the growth is it’s exponential. It can go up really, really fast. It can get away from you really, really quick, and you can think you’re doing all the right things and what you’re really doing is digging yourself a hole.
Speaker 1 (31:55):
Yeah, I love growing businesses, I love growth, but sustainable growth is key. And it’s got to come off the back of the right structure to handle that growth. And that’s what we’re talking today is if you think around what position first person, second process, third is it’s structure. You’ve got to get your structure. If you don’t, like you said with the scaffolding is you grow your business and the whole business becomes shaky and that’s why a business grows and the business owner either and feels like they’ve got less freedom than ever, or it grows and implodes and they go back to a waterline of what is sustainable, and that’s because the business grew, outgrew its structure that it could handle and that’s why it started getting wobbly.
Speaker 2 (32:47):
Yeah, absolutely. The other one we see a lot is just thinking through clients. I think you and I had this conversation earlier today, clients that then think, because I can run a business to this level, I could have two of them, I think I could do two, and then they open up the second business and all of a sudden they still haven’t got anything but names in boxes in terms of their structure in the first business thinking that they’ve grown, thinking of, look at the numbers on our sheets, our p and l looks great, and then all of a sudden it’s like, holy shit, we’re really struggling now. And that’s devastating to see. It’s like you can’t shortcut this. You’ve got to get this order right in order to take that next step. If you don’t, you’re going to have a bottleneck, but you’re also going to put a ceiling above you that you’re going to break and crash,
Speaker 1 (33:30):
And they just keep throwing people to solve the problem, and this is where I sat at the start. Now you’ve got more staffs, more problems, and those problems show up in bigger payroll, more ears, more mouths and more opinions, and all of a sudden you’ve got this huge, big payroll of all these people around you, and the problems don’t go away, and it actually becomes, when you don’t have your business structured correctly, it actually becomes more stressful as a business owner then, and that’s why then they have the mindset, oh, it was easier when it was me and four blokes and I could just do this and that. It’s actually not easier. You just didn’t have your structure and they blame. They’ve convinced themselves it was easier when they were smaller. That’s not true. It’s just that you grew without the right structure, and then you’re going back to what’s safe and easy for you.
Speaker 2 (34:23):
Where you’re comfortable, where you know what the risks are, and you’re happy to have that rather than the other side. So no, I agree a hundred percent. This last part, we’ve probably gone off script a bit and we’re probably ranting a little bit, but these lessons that we’re seeing are real, and if you’ve recognised anything in terms of what we’re talking about these impacts, and if you see any of that your way out of it is to get this process. So go back over these steps and say, well, what order have I done this in? And I can guarantee, if you’ve got the growth problem, you’ve got the chaos problem, whatever it is, we would be able to trace that back and if we really looked at it, it’s as simple as getting those three Ps in the right order. Really what’s caused the problem in the first place.
Speaker 1 (35:01):
Correct. So every time you want to grow, you’ve always got to restructure to unlock the next phase of growth. That’s the big punchline of today’s episode. And when you’ve got to restructure, the first thing you’ve got to do is go, right, what’s the position that I’m looking at filling? Is it a combination? Is it combining this role with that one or is it a new position that I’m creating or something that I want to fully delegate? But you get really clear on the position. Once you get really clear on the position, which is the roles, responsibilities, activities, and what the tasks are going to be doing, then you go to market and get that person. Once you get that right person, you get them in, you onboard them, you train the shit out of ’em, you actually relinquish control of the things that they’re going to be getting paid to do, get them set up. Then once you know that you’ve set them up for success, build the processes around that position, and then you just rinse and repeat as you just keep restructuring growing, restructure growing, and that’s how you go from 1 million to 1.5 to two, 2.5 to 3 to 4 to 5 and beyond, because every time you just keep restructuring to unlock more growth and the business becomes more sustainable and scalable, not to the point that it just swallows you in visits got out of control.
Speaker 2 (36:20):
Yeah, absolutely. 100% agree. I think that’s a good place to leave it, Rob. I think there’s so many lessons in there, and if you’re struggling to find them, listen again, I guarantee they’re there for you.
Speaker 1 (36:30):
Hopefully you’ve enjoyed today’s episode. If you’re in that position where you are wanting to get your business structure right and you want to unlock the next phase of growth in your world, then book in a strategy call @strategysession.com.au, and let’s talk about how we can structure your business in a way that unlocks growth and profits, and more importantly, more family time. Looking forward to talking to you then. Until then, see you next week’s episodes at The Trade Den. See you soon.