Episode 366: Operator to Owner

Hey everyone, I wish I could give the correct attribution to whoever said this because it has made a tremendous impact in my life. You get paid for what you do, you get returns for what you own. And that means quite literally, as the business owner, what you get paid as a W-2 salary on the books But it also means then what you get returns on, return of equity specifically, is for what you own. Let me take you back. I was visiting my mom in Killen, where I grew up, just outside Florence, Alabama, and I needed to run to the store to pick something up. So I run to this convenience store there. There's only two where I grew up, and so I go there to pick up a charger, actually. And so they were in one of those semi-enclosed cases, and so the gentleman behind the counter needed to come unlock it. And so I said, hey, can you come unlock this? I need to try to find one of these. I was actually trying to find a charger for an iPad, but that's irrelevant for the, the point of this. And so as I'm looking through this, I'm looking for the right ones that ones have the brick and ones don't have the brick and making sure it's a USB-C, etc. He, out of the blue— I mean, we, we didn't have really any exchange— he says, he says, gosh, I hate my job. And I said, oh well, I'm sorry to hear that, um, change it. And he says, well, I really can't, uh, My dad, it's my dad's business. And I said, oh, okay. Um, and then he goes on proactively to share, yeah, this is, uh, one of 7 stores that my dad, uh, owns. I said, oh really, that's interesting. And I said, well, the money is in the owning, not in the operating. He says, well, I have, uh, actually 25% equity of all the stores. And so now at this point, now I'm intrigued. He's got me hooked, which was such a random conversation to be able to have at a convenience store attendant who proactively offered up that he hated his job. And come to find out, he apparently owns or has 25% equity in 7 of the stores. And so I said, well, um, the money is always in the owning. It's never in the operating of the business. And he said, uh, we ended up having an exchange, um, for a few more minutes before I ended up leaving. The point for this, for all of you, is I do believe that you begin to kind of see yourself a certain way. And so for those of you that maybe worked for either a corporate entity or worked for a small business owner, I think that you have to begin to— at least for me, I needed to change my mindset as to how I saw my role in the organization. I see this quite often with some of the clients that we work with. If they were in, say they worked for another insurance agency owner as an example, and they take that W-2 mindset into their role as the business owner of the business. And so they see themselves, they, they have a hard time making the shift or the transition from being an employee to being an owner. And I would tell you, the way that that begins to actually manifest itself is you begin to kind of see yourself as the operator of the business as opposed to the owner of the business. Now, I want to be very clear, this is not to say that you are better than any of your employees. Nothing could be further from the truth. It does, though, however, mean that you play an important role in the organization just as your team does. It's just that your role fundamentally is completely different. So to go from running the day-to-day of the business as opposed to owning the business, and what you get paid to do is what you do day-to-day, but what you get returns on is what you own. So I'm going— this is kind of a high-level at this point, but let me give you an example. People— and I'll even use some salary ranges. And so if you get this idea of that you need to learn how to delegate, okay, now I'm not going to turn this podcast into a delegation, but I heard that for a number of years, that you need to delegate. And I think that the— what for me anyway, that I would hear is what are the things that I need to get off of my plate? And I think that that's part of the equation, but the other part of the equation is what do you fill the time back with? In other words, if you remove certain things off of your plate, you empower your team members to own that thing that you once were doing. They take ownership of it. You have complete permanent delegation, which is for another video at another time, but they own it. The question then is, what then are you going to use the remaining time to do? And so if you can get something off of your plate that's a $20 an hour task, which is roughly a $40,000 a year job— let's just say it's a $25 an hour task and that's a $50,000 a year job, you get the point. So if it's a— we'll go off $25, that's, that's a good round number. $25 an hour, you can give that to someone who roughly is making $50,000 a year, but then that allows you to spend time on the $100 an hour task. Then that is a much higher leverage in the things that are actually going to grow the business. So the part that I for a long time did not understand, which was what are the $100 an hour tasks, what are the things that actually move the business forward. So let's back to the gas station example, he was getting paid for whatever it is that he was doing in day-to-day, and whatever that wage is, let's say it's $15 an hour. But if indeed he does have 25% equity of that business, what would be a much more highly leveraged opportunity is for him to be able to go and find someone to do exactly what he was doing checking people out, handing out sodas and opening up cases for people like me to be able to get a phone case, etc. He had somebody else do that. He could then be looking for maybe an 8th gas station that somebody wants to get rid of, and now they add to their portfolio of gas stations or whatever that may be. That is a much more highly leveraged opportunity than doing what it was that he was doing in there. Now, I didn't spend enough time with him to get an idea of his mindset and his background and, you know, what influence he has and all of those kind of things. But I think for us, day to day in the business, this begins to come out in a lot of different ways. We were really good at doing the thing, and it was working See, it wasn't because it wasn't working. It's actually because it is working. We're doing the thing until no longer can we do that anymore, or we simply run out of time. So the business may have started off early on and everything is running through you. You are truly the rainmaker of the business, and it's working. You see success. Maybe you worked for a business owner, an insurance agency owner, a small business owner, etc., and so you were really good at that skill. You jumped in to the seat of being the business owner. You kept doing what it is that you were good at, and it started to work until it doesn't work anymore. The big business begins to slightly plateau. You don't see the growth anymore. So what do we do? We work harder. We push the gas pedal down even more, up until the point to now it's 7 days a week. It's not 9 to 5, it's 5 to 9 all the time. People say, you know, morning, morning, noon, and night. I mean, it's It's all day. It's all-consuming because we only know one way, which is continue to do what it is we're doing because it was working. But there comes a point to where that has to fundamentally shift. You have to begin to really see your role very differently. How do we drive results through other people? How do we delegate these things off of us so we can buy back our time, as Dan Martell says, buy back our time so we can work on the higher leverage task and the things that actually grow the business and grow the enterprise value of the company. And a lot of times, actually, as business owners, we enjoy working on those higher leverage things to begin with. So I think it becomes— you hear me talk about making the shift from being the rainmaker of your business to becoming the architect, and that is a journey that we're all on, even myself. You're on the journey of becoming the architect of your business. And so you see things differently, and even seeing your role in the organization different. And so I think this was certainly the case, uh, for me, is that I knew one thing, and that was how to be able to talk to people and how to be able to make sales. And so guess what I did in the early years? That's exactly what I did, and it worked up until the point it doesn't. And so if something's not working after a period of time, everybody's going to make a change. The question is, is whenever it is working and then you run out of time Specifically, what are you going to be able to do? And so a lot of times I try to look at and see and pass along what are the mental models or the mental shifts that I should have. And so I think it's taking the operator hat off or taking the employee hat off and putting the owner hat on. And so again, I want to be very clear, your team plays an incredibly vital role. I believe this is one of our maxims: business is a team sport. Business is a team sport, and you have to be— I just don't believe in solopreneurship. I don't believe in that. I know there are some people that, that, that love that, and that's fine. That's just not what I signed up for. I, um, even in golf, which is a very lonely sport in and of itself, the things I love the most was actually playing on a team. Uh, whenever we were in college and you played on team in high school, but especially in college and even after college, whenever we get to play in team events, whether it's 4 balls with, uh, you know, you play with another, another partner, etc. I mean, some of those are the most fun team events. If you think about the guys on PGA Tour, they, uh, they love the Ryder Cup, they love the Presidents Cup because they're actually playing on a team. As a matter of fact, Liv Golf has even kind of taken that idea. So You're— everybody on the team plays an incredibly important role in your organization to be able to drive results forward. It's just the role that you play is very different. And so if you've struggled with that idea or that label of going from being kind of the operator, the day-to-day of the business, um, to making the owner shift I think that there's a, there's a few things to consider, and I already mentioned one, so let me recap. I think number one is fundamentally is what are the things that you need to get off of your plate so you can buy back your more, more of your time? But then what are you going to fill that time back with? Okay, so if you're able to begin to document certain things about what it is that you do so that you can buy your time back, what is the $100 to $250 to $500 an hour task? and there's not many of them. There's not many of them. Now, um, that could be looking for and recruiting, training, and developing your team, your A-players. It is looking at another business to be able to acquire. It is thinking about the strategy, what you're going to do, what you're not going to do for the direction of the company. It is setting the business blueprint— 3-year, 1-year, 90-day, um, 3-year vision, 1-year objectives and key results, and then your quarterly targets. Those 3 things absolutely are $100 to $500 an hour tasks. The execution of those can absolutely be handled by your team. And so those are just some examples. So I think you begin to kind of see your role in the organization slightly differently. I hope that episode served you well. Love to invite you to begin to make that switch from being the operator to the owner. We're going to be running our quarterly planning session for all of our members, and you are invited totally free. Go to above the business.co to be able to register above the business.co. You'll see the button at the very top to be able to register for the quarterly. I look forward to seeing you there. Till next time, lead well.