How Small and Medium Businesses Can Turn Their Size Into Strength and Flourish with Sri Kaza

Why am I here? Why are we here as a business? Why are my teammates here? What are we trying to accomplish? Right? And what do my customers really want? Like, knowing those things and incorporating them into role modeling and behaviors as the leader of the business means your team will intuitively pick them up.

Welcome to the Happiness Squad Podcast. Your weekly dose of practical tips and inspirations to help you operate at your fullest potential by integrating the science of flourishing into how you live, work and lead. In each episode, we will share insights, tips and stories from leading experts, company executives and flourishing solution providers that you can implement right away to make happiness your competitive edge and find more success, joy, health, love and meaning in everything you do.

What if small medium businesses stopped trying to play the big guys game and started winning on their own terms by making flourishing their competitive edge? In this episode of the Happiness Squad, I sit down with my friend and former McKinsey colleague Sri Kaza. Entrepreneur, investor and author of his new book, A Small Business Strategy Guide. Sri has spent decades building and scaling companies from Viking cruises to mission driven financial services, and now he's on a mission to help SMBs thrive. We unpacked his three underdog principles, positioning, proximity and Purpose, and explored how smaller companies can outmaneuver giants by getting closer to their customers, leading with purpose, staying true to their why, and using their size as an advantage, not as a weakness. Sri shared inspiring stories of entrepreneurs who've turned these principles into outsized impact and how AI used the right way can help small businesses close the competitive disadvantage and grow without losing their soul. If you're an SMB owner, leader or dreamer, this episode will give you a playbook to flourish in today's economy. Come, let's dive in. Sree, I am so excited to have you here, my friend, on our Happiness Squad podcast and share and learn from you. Your story over the years and the book that you're coming out with, it just so resonates with the work we've been doing. And so thank you for being here. Thank you for kind of fighting for the little man. The small medium businesses that account for almost 50% of the employment and 50% of the GDP for the country.

Thanks Ashish. Really appreciate you having me. Look forward to talking about what you're up to and how, what I'm doing. Actually, I think they dovetail quite nicely. Yeah.

So look, let's start a little bit of personal journey. You and I know each other from McKinsey, but start a little bit from your own journey from an engineer to consulting to a Mission driven financial company to now to what finally led you to write this book. I mean it's just so many such an interesting journey. Like maybe give a little bit of an overview of what that's been like for you.

Yeah, I definitely have pursued opportunities as they've arise, as they've arisen. You know, coming out of undergrad I'd learned how to be a chemical engineer. And actually I didn't particularly pick it for this, but chemical engineering at the time was one of the top paying engineering jobs coming out of college. And so I had gotten some really nice, attractive offers. But what really caught my interest was a consulting firm that wanted to go and change the world and make businesses operate more efficiently. And maybe with some naivety I thought that, wow, cool, I'm going to go get to advise big businesses on how to do things. It was a very interesting choice because right away, this is right before the year 2000, a few years before the year 2000. And one of the biggest things on the agenda for most big companies was let's get rid of all of our old software and replace it with the latest and greatest stuff. And me graduating from an engineering program, I didn't realize that this was even a thing. I wasn't even worried about Y2K. But I get to the consulting company, they say, okay, we're going to teach you how to code. We're going to teach you how to code in some, a different arcane language. It was a German one called abap. And you're going to know how to do this. We're going to go install software at all these companies. We're going to make millions and you'll get, you know, some pennies for your work. And right away I learned, you know what, you can learn anything. You just take the time to get smart on it. And I can walk into, with no experience at all in life, I can walk into a situation with knowing just a little bit more than the next guy and be helpful. And I think the thing that really got me excited about it was, hey, I can actually be helpful. I can bring something to any of these situations and be helpful. That of course was fun. But after Y2K had like been you know, fixed or proven to not actually be a big deal, I jumped onto the dot com boom. And that was also another fun ride to go and learn things that I had no idea were possible. I sold million dollar software without actually the software existing because that's what people were doing in the dot com.

Yeah, they were selling a dream.

Yeah. And it turned out selling dreams is actually a ton of fun. My career just went on.

I went into McKinsey.

I wanted to learn real business because I knew what I was doing was like, not really right. I learned some kind of real business y stuff at business school. And then I joined McKinsey thinking I'd get to put a lot into practice and learn a ton from big companies. I think I did. I think I learned a lot. It was a lot of fun for me. I really enjoyed my time with you, with everybody else I worked with. But at some point, I got this itch to go chase an opportunity again, and it was fantastic. One to sell the dream. This time it was for someone named Tor Hagen. He is the founder of Viking Cruises. At the time I joined him, it was actually called Viking River Cruises because that's what they did at the time.

Yeah.

His dream was to I want to have an ocean cruise. And he didn't have one. And part of his dream was, okay, for me to have an ocean cruise. I need to sell out that ocean cruise before I build the ship. And of an interesting challenge. You know, you see an interesting challenge like that for me, I was inspired by his ambition. I said, hey, that sounds awesome. I want to come on board and help sell out your ocean cruise ship so that you have enough deposits to go and build it. So working with these kind of ideas, from 0 to 60 miles an hour or whatever speed a business can come up to speed, has been really a lot of fun for me. I went on then later to do a couple of other more entrepreneurial ventures of my own. One of which was Forward Line that you mentioned, where we were lending to small businesses. I got to hear not every one of the small businesses stories, but as a. As a process, as a practice. Every small business contact, as we worked through, understood their business. We understood the business plans, the business model, and I got to engage with a lot of them just to hear the story. How'd you get here? What do you want to do next? Those two conversations, very different and distinct conversations, were inspiration for me to really be excited about the work I was doing at the time and translate into the work I'm doing with this book is listening to people with vision, big or small. You don't have to go build a cruise ship, right? To have an exciting vision. What you have to do is have a vision that you're personally excited about. And to me, that's where the fun is. Yeah.

No, I love it. Right? And there's so many parallels. Sree it's so funny. Like, you and I know each other for a long while. I also came to the U.S. you know, in 97, you know, chemical engineer retrained by IBM in Cobol, have cobalt business brought over, brought to Chicago to do Y2K solve. Right. Like, literally that was my first job. I mean, my second job, my second job after I left the IBM was working for a company called Keen, where I was one of the three project managers, one of three leading the Y2K effort at ComEd, the largest utility in Illinois and all of that region. Right. I was one of the three project leads. Talking about if you can learn something and know a little bit more than everybody else. I had people on my team, I was 24 years old. I had people on my team who were like, whose kids were older than 24 years old, right. And I was the project lead and I was like, like really kind of, you know. And by the way, six months of cobol, right? Like, it's not like. Yeah, no, I mean, they had 30 years.

That's right.

They have 30 years. But it turns out you taking the.

Time for those six months helps everybody around you. Which is why going in and being helpful and just saying, hey, look, I bring something unique and different, you can still do the job that you do, but, you know, we'll work together, we'll do something bigger and better. Like to put. Yeah, like I even, I kind of chuckle because I see it even today. You put somebody young or inexperienced or whatever into the mix and I have all this responsibility. But if people can actually step up and deliver, actually they can make a big difference. It can change a lot at that age.

At our age, by the way, it's.

Still 20, 20 something at least up here. And you know, approaching the world in that way gives you so much more enjoyment out of what you can create and what you can do.

Absolutely. Especially because now the gap between knowledge and practice, right? Like knowledge with AI, like you don't need to have 10 years to learn digital marketing. A lot is there. You need to be willing to take it, try it, learn from it. Your own learning too significantly. Right. And I think that is such an important. The skill of adaptability, resilience. Learning is becoming so, so, so powerful. But we go off, you know, we, we diverge a bit. But I do think, I think, I love. I'm really, really like you, passionate about the small medium business space. I think they have it, they have it really hard. Oh yeah, it's really hard. You know, you are much less productive because you have hard time attracting talent. You don't have the brand, you don't have the scale. And all the advice out there. SRI is about trying to do better than the big guy. And that's the worst play you can. You can't defeat a sumo if you are kind of small by trying to act like a sumo.

Right, right, right. You can eat all the nabe and all of the fish that you want. You're never going to get as big as those guys.

Right.

You're just going to get thought.

Never. So you, in your book outline a very different approach. You call it the underdog principles. Right. So don't fight the big dog by trying to pretend to be a bigger dog. Right. But do it differently. Walk us through, you know, those three principles, positioning, proximity and purpose. And maybe bring it to life through a business story.

Sure.

Right. That really captures that.

Yeah, I think the principles, the reason I picked these principles and kind of the reason the data and the insights kind of floated these to the top, is every one of these small businesses, successful or not successful, that I had interacted with, have these principles at their access and big companies don't. So when I talk about positioning, positioning is really how different you are and how unique you are to the rest of the world. And in many cases, just a simple examples, your location is enough. That's why I picked the word positioning. Your physical location is enough to differentiate you. You are the closest place for someone to get whatever for your neighborhood. Positioning can also be about how unique you are relative to other competitors or who you choose to serve.

Yeah.

A big company who's got shareholders to go satisfy, investors who have growth targets, et cetera, profit margins, expectations, you've got to go pursue every customer. You've got to try to make as many people happy as you can. But the small business, they were to do that, they spread themselves too thin. They don't have the resources, and then they don't gain the loyalty and the and the commitment they could from their core customers. When you see companies pursue their core customers and create deeper relationships and deeper loyalty out of serving the ones who already appreciate them or serving people who have the potential to really appreciate them. When you see them do this, when things go south, like during COVID or during many of the other challenges small businesses face, their customers then will rally behind them. You think about small businesses that you rallied behind during COVID like there's gotta be a restaurant that you used to eat out at.

Absolutely.

You would have probably never ordered takeout. But then you find yourself ordering takeout two times, three times a week just because you know that custom. That restaurant needs your support because you want them in your life. So positioning is a piece of saying, hey, I'm important enough in the lives of enough small customers, small business customers, to be unique and wanted and missed. If I'm not there, it doesn't mean you have to be perfectly unique. And there's no business like you, but there should be no business that, that's like you to these customers. And then the proximity piece is an extension of that too bit and is also kind of unique in of itself in that these small businesses have closeness to their customers. They all do. They maybe don't interact with every customer every day. Maybe they have their team interact with their customers. But they're so much closer to what their customers want than large companies. Large companies need data and do analytics and do exactly what you and I were trained to do at McKinsey is go by the numbers, go look at all this data, et cetera. But it turns out, as you also know, that the numbers don't tell you everything. You know, you have to ask the right questions, you have to set the thing up. You get, you get all this interesting information and it tells you, okay, well, what's the most profitable move for me as a, as a business? But what it doesn't do, it doesn't understand the people, right? Data doesn't understand your customers. It doesn't anticipate what your customers are going to want to do or how they're going to go change. But you know what? Small business owners can do that in a heartbeat. And if they really know who they focus on, who their customers are, leveraging that proximity, leveraging that knowledge of who their customers are, makes them much more adaptable than the big business. As trends change, as the environment around them changes.

By the way, the other proximity I think also that is really relevant is they're actually very close to their employees. Like many businesses, you know, the lives of the people you're leading, you know, the person who's delivering or in the front, and the ability to be close to them and build that human relationship and help them achieve their dreams and support them in a way just for me, creates this unbelievable advantage. Most employees in big companies feel like a cog in the wheel. They just feel like a cog in the wheel. They don't feel seen, they don't find meaning at work. It is just a way to earn a paycheck. But by being in the lives of these employees, by being close to them, I think there is a force, right. I always talk about you can take your people and turn them into Davids that take down the Goliaths. Because all the Goliath has is this, you know, big sized, massive, slow moving thing.

Yeah, yeah. You think about today, there's so many challenges with recruiting and talent. Not just for big businesses or small businesses, just across the board. Labor market's shrinking, right. Using, losing a whole number of people who are participating. Boomers, retiring, immigrants kind of leaving. And small businesses are really struggling because the big guys are out there and they play all kinds of games, right. If anybody out in your audience is listening and they've tried to apply for a job through digital means, it's like 10,000 applications to get one read via human. Now because of the AI these bigger businesses are using. But the small businesses, they don't stand a shot at competing here, right? You're going to get more ghosts in your hiring file than you'll get actual candidates. You have to use your connections to the community. You have to use your connections to people. You have to have people that you care about to be able to hold onto them. And it's an opportunity today to start playing the game that you're federat than the big guys. Right. It comes around to, you know, like, like we talk about positioning, we talk about proximity. Comes around to purpose too. You know, as a, as a small business owner, your purpose isn't purely just profit and growth like your shareholders want. You may have some stakeholders that, that are expecting earnings for sure, but your stakeholders are also your, your employees in your community and yourself, personally yourself. So you know, when I, when I talk about purpose is one of the principles, one of the three underdog principles. It's not so much that I'm saying hey, go make up a purpose to pursue. It's be in tune with the purpose that you have. Why did you join this business? Why did you start this business? Why are you still doing it? How have you evolved as an individual over the years? How should your business or your business decisions contemplate satisfying your purpose? Sometimes over your profit? Again, simply being conscious of it and incorporate into your thinking, it makes a night and day difference in your enjoyment and your success as a business leader.

Yeah. And I also feel, you know, on this point of purpose, as you say Sri, no person like maybe only the super young, right? Because they're just ignorant, they just ignore it. Right? There's this beautiful how hard entrepreneurship is or starting something from scratches. I think most young people are just Ignorant, right? My son, who's 15 and 16, like I'm literally getting him to watch some of these things because he's like, I want to be an entrepreneur. And I'm like, that's great. Do you know how hard it is? Like, you should do it, but I just want you to walk into it that you're basically committing yourself to eating cup of ramen for a long time.

No, no, your son, you're going to make sure he gets well fed. See, that's, that's the other problem. I've got same, I got the same challenges at home. I think you're getting to a really important point, which is to be a successful entrepreneur, you're going to have to persevere. I don't know any entrepreneurial story aside from a few kind of lightning cotton a bottle stories where the entrepreneur didn't face like existential challenges. And most of the small businesses I talked to during my research and doing the work that I was involved with for the past 10 years, they've all suffered through really tough times. Every one of them, personal, professional, market oriented, financial, whatever, or just overall economic conditions and purpose, was a huge portion of or huge part of what kept them alive. Either because they gutted it out, because their purpose mattered so much to them, or that their purpose was actually recognized by the community or by the other stakeholders, the partners or businesses. Even the business that I ran, you know, we were lending to small businesses. You have to understand, right? There's a lot of money outstanding to these small businesses and Covid hits and they all closed their doors at the same time. My business was toast. But every kind of, every spreadsheet I ran, everything we did internally was like, hey, this isn't going to work out. So we got to let people go. We're going to start to wind things down. We'll do what we can for everybody who we owe money to and we'll survive. But when we flipped it around and talked to the people that we were working with, talked to the businesses who were supplying us capital or supplying us the data that we needed, or the businesses that we were working with, every one of them recognized that actually, you know, what if we give these guys a pass here or we make some adjustments or extend the terms or do a little bit here, do a little bit there, we can all still work together coming out of this. And I don't know, it's probably 20 different either vendors, creditors, investors, like all pitched in and gave up or traded away a little bit of what their rights were, right? And they all collaborated because in the long run, you know, they. They saw value in what we did. They saw value in us having. Being a partner.

Yeah.

And so when you get down to these couple points, your purpose matters.

Like, if people believe in your purpose, your purpose matters.

Yeah.

Yeah. I love that story, Sri. I love that story. You know, there's a beautiful saying, right, by Nietzsche. Those who have a why can survive anyhow. Those who have a why can survive anyhow. And it's so true, right? No person starts a business without a very burning why. It might be I want to be independent. I don't want to work for the man. It might be I want to make an impact. Oftentimes there is an itch. There is a problem you're trying to solve, which is your problem, but also shared by others. And one of the biggest things that happens is people lose sight of that why. And that why has the power, as you talk about, the product can change, the service can change. You can pivot seven times around. But if the why is clear, it'll keep guiding you forward. Right. It'll see you through the struggles which are part and parcel of an entrepreneur, small medium business life, just like they're a part of any life, even with big companies that is given. So I want to delve a little bit into it because purpose is central to flourishing. It's central to all of the work we do at Happiness Squad. Right. Helping people define a why at the company level, but most importantly, connect it to an individual why every person who shows up. Right. In fact, we don't hire people unless there is a complete mission alignment. That's first. Skills can be learned. I don't care about skills. Yes, they will matter, but we have to be completely aligned on what we are trying to solve here. So tell me a little bit about purpose and share with me some inspiring ways in which you've seen small medium business founders use the power of purpose and values and use that to create a very different engagement with customers and employees.

Oh, you know, fantastic example. I don't. I don't think it's the one that every small business has to look to to say, hey, how do I do it that way? I think it's very unique to this individual in the business. But, you know, there's bookstore owner I met doing my research. His name is Jonah. He runs a bookstore called Words in Maplewood, New Jersey. Jonah, you know, he was a. He was a lawyer. He was a quite successful lawyer and he loved books and enjoyed bookstores. But he was getting Paid pretty well as a lawyer. But his son was diagnosed with a severe form of autism. And he and his wife decided one of them would stay home, the other would keep working. He would take care of the son. But at, at a point when they got to, they learned how to manage and work with his disability, he decided, hey, I want to go back to doing something that I'm passionate about, which are, you know, having a bookstore was one of those ideas. So he said, hey, look, why don't we do this? He, he, he passed a, a bookstore that was for sale in, in this, the city of those. You know, we need a, a better place that's more community oriented for a bookstore. This one's for sale. He decided, no, no, but I don't want to buy this one and keep it here. I want to move it to a place that's got more of a community center. Not only that, I want to do something with this bookstore that's going to invest in not just my son, but anybody who's got severe autism. We do workshops, a number of things. And to go another step or two further, we're going to hire people with these conditions and we're going to craft. He used the term job crafting. So we're going to craft jobs to fit their skills. So what you find when you go into a store is, you know, great people, good service. You find a community that's caring, that's understanding. And then you find that he's actually achieving his mission in a way that you can touch and feel when you're in the store or just participating in any of their events. And then they do a lot more that give back to the community. They also host other social groups at the community. Use it, use it at the community center, in the bookstore. So he's got this purpose. And look, even in the toughest times, like, Covid was really tough for them too. I had to let people go. I had to shrink things down. But the community rallied around him, right? The community said, hey, look, we want this, we want to have this. He got national support because he was doing something for people who have this challenge, these challenges nationally. And it wasn't easy. It was the same kind of challenge that you have to really, really care about that purpose to be able to persevere through the challenges during COVID But he's managed to do that and gotten back to kind of sales growth and impact, right? And to him, impact is more important, but he can't run the business without sales growth.

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Yeah, well, and I think it's, you know, for, for those who are listening or like, you know, if they say like, yeah, it's purpose, profit. But man, I'm small. How do I do it? Look, I think the research from Alex Edmonds and London School of Economics is so clear. He says this the most beautifully. We've had him twice on our podcast. He has this beautiful line. If you want to reach the land of profit, follow the road of purpose. Beautiful because the results are so clear. Those companies that really are focused on a mission, connect that to the employees, right? Really invest in their employees. They outperform everybody else. In fact, the incremental value that they're able to create by growing the pie is two to three and a half percent higher alpha versus others year over year. Right. So you don't have to choose between profit and purpose.

That's right.

Purpose can unlock massive profits because. Exactly. Sree. It gives you. People buy into it, Right. People who find purpose at work and are energized are willing to take lower comp because they believe in it. By the way, you reward them by giving them stock ownership as well. You make them a part of this.

As an owner, you don't have to take it away in comp. You keep paying them, you're still going to get less turnover and more longevity, more customer satisfaction. Just better quality employees in general because they believe in your purpose and your mission.

Yeah, no, it was so beautiful. I loved your story also, by the way of like, because you were aligned around making a difference to small, medium businesses, right? They shut down. I loved how even though, you know, so many of your customers shut down, your investors because of your. Why stepped in to give you, you know, give you that. Give you that longer, longer length, right?

Yep, yep.

The whole micro loan business in India is a big part of that. Somebody believing that it's capital that is keeping people in poverty. They have the skills but if I can help them, they will pay back. They don't have credit the way, you know, other big companies do, but I'm going to invest in them, right? And Grameen bank is an example of a multibillion dollar enterprise that's doing just that. Let's talk a little bit about proximity and talk a little bit about a story of proximity. You know, that connection with customers and connection with employees that make a big difference.

I found something counterintuitive in doing my research that kind of, kind of exemplifies proximity or being in tune with your customers. The research I was looking into was, hey, what were the government intervention effects on small businesses? Especially where they differed in different states, but the interventions were applied to the same kinds of businesses. My first thought was that, okay, look, the hair salons and nail salons in LA would have gotten hammered, while the hair salons and nail salons in like Orlando, Florida would have been thriving. And I quickly found that actually, no, there's meaningful differences. And you saw speckled performance in some of the states where there's a lot more flexibility for the businesses. And you saw generally consistent, not like great, but generally consistent performance, performance in the more restrictive cities. And in the interviews I learned, look, in the, in the restrictive cities, everybody is on the same playing playing field. They made their adjustments, they let staff go, they reduced their cost base to fit the revenue that was coming in and then moved on, right? And most people followed roughly the same playbook. They didn't have a lot of freedom to do different things, so they just didn't. But in other places, like the example I saw in Orlando of Florida, the owner of a nail salon, she decided that she was going to implement her own social distancing that was a little bit more constrained than what the guidance was. And she was like, in a mall, there's even another nail salon in that mall. And what she told me was, you know, a number of her customers called to say, hey, look, what's the deal? Like, how are you guys going to take care of this? And what she picked up, what she kind of knew was in the community that she was serving, they were worried about some social distancing. They didn't need the LA level of social distancing, but they didn't want zero, right? They wanted to know that the folks were wearing masks, right? They wanted to know that there was a little fewer people in the salon. And so she set up standards and rules, right? Communicated them and, you know, reduced the staff a little bit to make sure that you Know, everything would balance out with the revenue and her costs. And what she told me was, yeah, the other folks waited by empty chairs for days because their customers probably had the same concerns, but they weren't being addressed. And so if you don't address your customers concerns and you've got the freedom to do so, you know, you're going to have an issue. So what I learned from this is when you look at some of the national chains or national businesses that tried to adjust, they had these national policies, right. We're going to do this cross country. And every community is different, every customer base is different. And the owners that are in tune with their customer base and make the adjustments to their customers want, they're going to make a difference in their community and their community is going to respond. But again, I'm not going to pound against regulation or pro regulation, but we take a lot of that away when you say, hey, this is how it's going to be. Businesses don't have a choice, you don't see a lot of differences and all businesses going to operate the same way. But when a business, when the businesses have that creativity or have that freedom to go do what they want to do, they can outperform when they adapt to their customers the best.

Yeah. And adapt to it fast. Right. Because again, you're close, you get information way before everybody else if you're in tune with it. Right. And empower your people to make the corrections, you know, pretty quickly. Right. I think there is a, there is an element of speed if you're able to activate the human magic that is often lying untapped in large organizations. That small unit, if you unleash that human magic, unbelievable things become possible. But only if you do it right. If as a small business, you play the old big company playbook. Good luck. Good luck competing.

Yeah, no, exactly, exactly.

So, you know, look, in all of our research, what we find is those businesses that flourish, you know, they prioritize connection, they prioritize meaning, and they just prioritize this human energy. Right. How people feel, how people feel, how aligned they feel with that business. How do you see the parallels between Sree, all of your research, of course we talked a lot about purpose, but like, you know, around positioning and proximity and just talking to so many businesses that you have, how do you see these play out? Where do they reinforce each other? Where might there be some tensions that you see that many businesses face?

Yeah, so what I see is it's such an easy compare for someone like you and I who go and Work for a big company. We pull together data, we do analysis, we take the time to interview, we can assemble a lot of insights and data and then make a very, very informed decision. Almost every one of the small business owners I talk to does not have that luxury to go and inform every decision. But what happens when you ground yourself in your principles? Who am I? Who do I serve? Who do I not serve? Why am I here? Why are we here as a business? Why are my teammates here? What are we trying to accomplish? Right. And what do my customers really want? Like knowing those things and incorporating them into, you'll know this as well. Role modeling and behaviors as the leader of the business means your team will intuitively pick them up. I would say to every business owner, you should write it all down, you should structure it, you should take once a quarter, reevaluate and make sure you've got this down and communicate really well to your team. Maybe you have all hands and you have like Q&As and all this stuff, but you know, there's no small business owner if you've got the time or energy to do that. So it starts with the principles.

Right?

It starts with knowing these three things really well and acting on them. And then decisions, not just by you, but by others in the company will pivot off of those principles because they're shared and people understand them as opposed to saying, hey, look, let me think about this, let me go do some analysis and get stuck in paralysis. You don't have time, they don't have time. So they're always making these decisions off the cuff. But you bake it in into responsiveness, like right away they can act fast because that's really important. But, but they also are on the same page because of that role modeling, because everyone prioritizes a certain set of things over other things and it's visible to everybody.

Yeah. So the move that you're saying is rather than focus on lot of data and then some policies that then get rolled out, lead with principles and live them, role model them, live them. That becomes the playbook for people so they can intuitively move faster than, but they understand those guard rails implicitly because they're principles driven.

That's right. Like I, I, I like the term playbook because someone had asked me that, what's the playbook for small businesses?

Right.

I'm like, you know what, if you can't put it on one piece of paper, it's not going to get used. And then of course, here I am writing a 300 page book. So, not that I listen to everybody's advice, but what, what I thought was valuable was you have to recognize they don't have time, they just don't have the time to do all of these things. So how do you embrace what you're great at or what's really great about you and still get it done without the luxury of a complicated playbook to go and hand out to people? You do have principles. You role model those principles.

So look, I want to talk a little bit about AI. AI is everywhere. Everybody's thinking about it. The big companies are adopting it a lot faster than small, medium businesses who are like, maybe it's still at the level of, okay, I'm looking at ChatGPT, I'm going to do something right? And I think as a technology I've never seen something so significantly, it can actually be a massive tool if used the right way to close the competitive distance between small medium businesses and large companies. And so my question for you is, what role do you see AI playing in helping underdog businesses scale without losing their soul?

I think that's a, it's a fantastic tool for these small businesses. I don't know how everybody is using it today, but we started off saying, hey, don't act big, right? Go be who you are. This amplifies your reach and your abilities in a ways that, that like wouldn't help a big business, right? You get 10 times more capacity with AI, while some big business, all they do is get a bunch of cost cut with their AI. So you think about it differently now saying, and again, these are terrible examples because I'm not the innovator sitting in any small business. But imagine you had a call center behind you in your business. Like how many small businesses, they can afford a call center, right? But now, shoot, let me set up a total call center, right? And it's not the core of your business, right? Your core business might be something else, but it is another thing that you can do that makes you, gives you more capacity to go work on things you care about. Well, I want to dive in on one of the things that I highlighted for my book's purpose. Bottlenecks in the business. Back when, when we were at the big firm, we would go into factories, I would go into like semiconductor factories and you'd go through and figure out like all these tools, all the expensive equipment, where's the bottleneck? How do we get more capacity at the bottleneck? How do we get non value added things away from the bottleneck and over to other Resources. Well, in the small business world, the owner is the bottleneck. Maybe the few other executives or maybe there's some physical asset that's also a bottleneck. But like these are the bottlenecks. AI will open up that bottleneck. There's so many things now that you couldn't do or you didn't even think about doing that. Now you could say, hey, look, you know what? I hate social media. It's not my thing. But now I can use AI to generate tweets, et cetera, get something going so I have more of a presence online. Or you know what, I didn't know how to respond to all these kind of inquiries, that there's just too many of them. I didn't. So I just shut down my inbounds. But now you can set something up where you can weed out the stuff that's actually junk. You can go focus on the customers that matter. You give your customers opportunities to connect with you in many ways, gives you more capacity to do the things that you want to do.

Yeah. You know, I love this provocation. I had not thought about it this way, SRI and in every one of these conversations I learn most big businesses are really today predominantly thinking about AI as a way to cut costs. It's true. Right. Increase productivity and I'm going to capitalize on it by cutting costs. In the hands of small medium businesses, they don't have resources to cut, but what they can do, they don't have that, but what they can do. If you're a small medium business, take this as an opportunity to to 10x your productivity to be able to go after more markets, bigger value that earlier you were bottlenecked on. I love that provocation.

Yeah, absolutely.

It's a growth enabler for small medium businesses. It's a cosplay for the large guys. It should not be a cosplay for the big guys. It should be a growth play too. But that's where they're operating. So now again, underdog principles. Use AI for growth, don't use AI for cost. Yeah, right, Absolutely. And fulfilling your purpose. And I'm going to share there's more things. Fulfill your purpose.

Yeah.

I'm going to read this story about what's actually possible today, which is unbelievable. So there was this company, this is a book called the Experimentation Machine. It's about how you find product market fit in the age of AI. But I want to share, read the story because from an SMB point of view, it really brings this story to life. Right. So there's a Story about a company called Talktastic, which is a startup. The guy who's actually running it is a non technical. He's a pseudo technical founder. Right. He's not really a technical guy. They're launching this voice first interface and he realizes that they actually haven't figured out a voice first support system that is actually available 24 7. He can't hire a bunch of support reps. Right, right, right. Like most businesses, they don't have a call center, they don't have people. So here's what he did. So here's what he's created. He basically created something where customers are prompted to leave a voice message on this thing that he created. Once the message is created, it's fed into ChatGPT, which is transcribed. It's added to Intercom which they use as their support system of record. It's then fed into Claude, which writes out a personalized response. It feeds it back to Intercom. In about five minutes the customer receives a message back, all without human intervention. Chat also analyzes it and logs it if it needs to be a bug fix. Now here's what's interesting and this is why I wanted to read it. Mirales built this video first AI powered support workflow in four hours.

Yeah.

Using without writing a single line of code.

Yeah.

This would have been a multi month, hundred, two hundred thousand plus investment. That's what's possible. Right. If we use AI the right way for small medium businesses and use it, train your people up, invest in training your people, give them this unbelievable productivity tool and let them go transform your business.

So how many businesses out there don't have the resources to do some of these big things that these big guys do? And right now these big guys are fire in tons of people who do it. Shrinking all their assets because they're going to leverage AI. There's technology now. You know, I was talking to a colleague who is implementing a voice to voice model for his call center. Because it turns out if you actually take the actual audio in your model, you can reflect and understand somebody's feelings a lot better, the sentiment and then respond as well with proper adjusted sentiment. So this technology is getting proven out by the big guys. But at some point, you know, my favorite idea I'm kicking around is why don't I just build a personal assistant? Like so I'm sure we're going. You'll find ones like, okay, I need a personal assistant. Maybe I'm a lawyer and I need a receptionist. Right. I'm an independent lawyer. I want to Sound like I'm at a big firm. So here's a number. Like I get a number and it can, it can be my personal assistant, checks my calendars, that's appointments, you know, does all this stuff and amplify your business with these tools. They're out there. You have to go look for them, but they're out there.

Yeah. Well, look, in your new role, you are a small business. You're. You've launched a book. The book is launching. You're out, you know, getting everything, getting ready. I know what it is like to launch a book. This demands a lot of heart and energy. And I'm just curious, Sri, what are some daily or weekly practices that help you, you stay grounded, renew yourself and really, you know, grounded in this purpose about really helping SMBs win?

Yeah, it's. I don't like to think about it like a business, but it absolutely is from a technical perspective and from some of the lessons I've learned and share in the book. For me, the big one that I talk about is purpose. And without the purpose, without me knowing I'm having impact on small businesses. This is a complete waste of time. I mean, I can make so much more money doing 10 other things than worrying about writing a book and talking about it. So I'm not making money on it. From a. From a perspective of I'm doing this for something better and to stay grounded is an. Every time I get something that comes up of, oh, hey, by the way, we want to go do this. Can you pay for the shipping or can you take, you know, this many days out of your week to go fly to the city for this, this thing? And if the first thing I do is ask myself, all right, this isn't a, we're not going to sell more books. If I do this right, that. Because that question comes up, I'm never going to sell more books for just flying somewhere or doing one of these things. But am I going to reach more small businesses? Right. The whole purpose was to go educate people on what I learned and share some inspiring stories and get people excited and hopefully help people reground themselves and what they were trying to accomplish with their businesses that they started already. If I can do that, then I'll get over the hump on all the other stuff, like the investment, the time, the energy. But I have that McKinsey brain pop in every once in a while. And, you know, because you can't stop it, sometimes it does the math. And gosh, you know, the math never works out if you're trying to, you probably know this as well. If you're just trying to sell a book, math doesn't work out. If you're trying to help people and you're trying to make a difference, then yeah, pour in a little bit more energy. So for me that's one of the biggest lessons is eating my own cake here. The other thing which you know I'll admit to is I'm not a big fan of social media and self promotion and so it just doesn't feel right to me. I don't enjoy it. But I'll tell you, if I just embrace what I like. Go having a conversation with a friend like this one, it's actually fun. I can actually enjoy this. So I'm going to embrace what I like. I'm going to outsource or offshore or AI some things that I have to do and make sure I'm having fun and hitting my purpose.

Well my friend, listen, this has been such an amazing conversation. I can't wait to host you in Boulder when you comes out. We'd love to bring a community together here of entrepreneurs, startups, small medium businesses and share the powerful three part underdog principles that you talk about in your book positioning, proximity and purpose and really use that right to and help them make, you know, flourishing their competitive edge. Really help them integrate them to grow their businesses, invest in their people. The future is small. I don't believe the future is big. I think we're gonna see this massive, right? Yes. The biggest of the biggest ones are gonna keep but you don't wanna be in the middle and it's really my bet is on the small medium businesses who are really going to outcompete the Everybody who is XL&L is gonna get crushed. The XXLs you can't do anything about. But the small and medium is where the magic is. Yeah, for sure is where the soul is right. And where the proximity is. So thank you for the work you're doing and I'm really excited to see you in person in a couple of months.

Yeah, looking forward to it. Thanks Ashish.

See ya.

That wraps up another episode of the Happiness Squad podcast. We hope you found the insights actionable to enhance your journey towards happiness and fill your life with more joy, health, love and meaning. Please consider leaving us review and share the podcast with anyone in your professional or personal life who you feel will benefit from some of these very insights. It's a really simple way to extend support, support and spread positivity. Take care and remember happiness is a choice that's available to you moment to moment in the here and now. Take care and see you next week.