The One Thing Entrepreneurs Miss In Business That I Think They Should All Study

Everybody welcome to Make More Marbles. My name is Brad Hart and I'm really excited to do a very different type of training today, which I think will be really helpful for business owners out there. It's how to think about business as a system. And systems are everywhere, all around us. We live in systems and we work in systems, we drive in systems, but we don't really ever stop to think about how those systems were designed, what the inputs and outputs are, how they work together, and how people get value from them. And a business, when you really break it down to, is just a system that adds value to people in exchange for money. It does other things too. But I think that's a really simplified way to think about it. And the more efficient that system is and the better problem it solves and the more marketability it has, the more demand it has, the more profitable it can be. So just thought again, said simply is like the, the system is designed to add value to people and at scale and more efficiently. It can add more profit to, to the owner and to the constituents, the shareholders, so on, so forth. So if we just think about a business very simply in those terms, it starts to become a really simple thing. And I feel like also most people don't. They're always chasing the next hot thing and they're always reacting to information that they receive and they're not always contextualizing it in history or in things like human beings have been doing human things for a very long time. Right? This isn't our first rodeo. We've been running businesses a long time. We've been adding value for a long time. We've been building empires since the dawn of civilization. And it feels like to me, we don't use the benefit of everything that we've learned and we don't take the time to actually sit down and think about these systems as a whole and what we're designing and how we're designing it, why we're designing it that way and we just of react to whatever shows up and we do our best to patch the leak and maybe move on to the next thing. And the really, really successful people I've met, the people who make tens of millions, hundreds of millions and billions of dollars, they're not just chasing the next cool trend and they're not just doing the next big thing, but they're approaching it with a systematic thinking style. They're approaching it with how can I design a better system that serves more people with less friction and more trust and more value and then they fuel that system with incentive. So the, the fuel of this whole engine is incentive. So I'm going to take some time today and break down some of these ideas. I looked for some of the books that are really great on this and I didn't really see anything that was super accessible. I mean you have like thinking and systems design. There's a woman that wrote it. She's passed away now in 2001. That's a really great book. I apologize, I don't have her name. Top of mind right now. Let me find it. Actually, real quick Thinking and Systems is Donella Meadows if you check her out. It's a really dense book but it's got some amazing principles. I'm going to capture them here and kind of lay them out for you. But all the props in the world to her, she's now passed away. So rest in PE and many, many other thinkers throughout time. But this is a book that's really influenced me and I've had mentors like Sam Ovens and others that have explained this very simply to me and I think you deserve the benefit of that as well. So if you're willing to give me 25 minutes, I can probably break down most of the big concepts and this will have far reaching echoes and implications in what you do for the rest of your business career. So I want you to be as successful as possible. It helps the world. I'm not a zero sum game kind of guy. I'm a positive sum game kind of guy. So I want to make sure you have this too. And while you're in this mode here, I just want take a minute to get you locked in, dialed in and also just ask you if you wouldn't mind helping us out. We are a small channel. We're looking to grow and reach more business owners and help more people. So if you could take a moment to like and subscribe and do all the things hit the bell. Whatever you do on YouTube or whatever platform you're on, I'd really appreciate that. That super helps. All right, so I'll leave a comment too. I'd love to get questions. All right, so let's dive into this and teach some stuff. I think this is going to be really great. I'm going to go over to the whiteboard and we're going to get going here. So if I go over there, that's the wrong one. If I go over here. Here we go. Bada bing, bada boom. Here we are. Great. So you should be able to see my whiteboard. I went to a Simpler version of my setup recently, so hopefully it all came through. The very first thing to understand here is that everything is a system. A very simple way to think about a system is inputs, outputs, the system itself. And this is probably intuitive for most people. I think they mostly get here. But what they miss is this piece, the feedback loop, right? So every time you get an output, you have to consider it in the larger scheme. And what does that do to increase the inputs, right, or to change the inputs, or to qualify the inputs, or to make the inputs better. Because there's tons of chaos happening in the universe at all time. We're trying to create a little bit of order that ultimately adds value to people in exchange for money, which allows us to get our goals. And it's all driven by incentives. So if you want to understand how a system works, you got to look at the incentives and if they're aligned or not. Are they personally aligned? Is there a system issue that's aligned? Like, every time people complain about politics or healthcare or this system or that system, I'm like, well, look at the incentives. Follow the money, right? That's the old saying. And you can work on this at a very small scale on your own business. And it might make a much bigger effect in the world if you can really figure something out that, you know, there's some rules here. Like, if you can create a higher trust system, that's a better system. If you could create a lower friction system, that's a better system. If you can create a system that serves more people, that's a better system. If you can start to combine some of these principles together, it's like, higher trust in the system, less friction in the system, more value added by the system to more people for less money, for less time, attention and energy. Wow, you've really got something there. So I want you to always keep those things in mind, like, how can we add more value? It's not just how can we save people time or make people money. It's like, what is the very specific, tangible, objective things that nobody can really get off the wheels on? Because what ends up happening a lot of times is people get into this mode where they forget that everything perceptually is subjective, right? So the value that I get from whatever product or service might be different from the value that somebody else gets from a product or service. I might care about different things about this product or service than others, right? I might value something differently than somebody else. I might not value it at all. I might not be qualified for that. Product or service, I might not be interested in that product or service, service based on my values and my goals. So when you think about perception, it's really equal to reality in aggregate. And when you think about subjective perception, it's true for that person. So if somebody tells me they had a bad time or a bad experience, I'm not going to discount that. Right? It's true for that person. I'm willing to listen to that. But if it doesn't show up again, I'm not going to redesign the entire system just to that one person's perception. They just weren't a good fit. It wasn't for them. Cool. But If I get 50 people that are like, yo, this is not right, or five, like, it's really high quality service or product, I'm going to maybe take that and make that as a feedback loop and put it into the inputs again and redesign the system to get a better output in the future. So hopefully you're tracking so far. So just very basic things. So we have inputs into the system, the system does something to improve or change or alter whatever was inputted and then the outputs come out and then you establish a feedback loop based on these ideas. Right. We know incentive is driving this thing. We know that customers want to get more value for their money, or at least fair value for their money of what they've invested as far as time, energy, attention and money. All those are important. We want to make sure that the owner is incentivized to make this as profitable as possible so that they can not only pay the bills, but ultimately generate wealth. That's the reason I got into business. We want to make sure that employees and contractors are all, you know, incentivized to make this engine run and to add as much value as possible. Right? So just putting that out there to start. We have our inputs, we have our system. This is what we control. Right? Right here. We can influence this. We can have hope and vision and all that great stuff. We can influence this and we can control this. Right? We can control how we perceive this data that the inputs are giving us into our new strategy, for lack of a better word. Right. There's more to it that allows us to create a different thing. So this is our locus of control, our locus of focus, if you will. These inputs drive the system to make outputs and all of that drives the upgrading of the system. So I think that's a good place to stop there. But let's go deeper into what this actually means. So let's dig into the first thing here, interconnectedness. And you can skip around if you're like, oh, I've heard this already, there'll be some titles and subtitles below and you can skip around on the transcript as well. So if you just need one piece, that's fine. I'm not going to be upset or butthurt. I just want you to get the value you need. But really, if you've never encountered these ideas before, I think this is worthwhile use of your time. So please keep going and just listen and absorb and start thinking about this stuff and maybe start to notice, like, oh, this is something I've never even thought about before, or this is something I hadn't really thought deeply about, or maybe I learned this a long time ago and I haven't utilized it in a while, where I should really take a minute to think about how I'm not allowing this to affect my business in a positive way, or I've forgotten about it or haven't prioritized it so that I can get the value. All right, cool. So interconnectedness would be the first thing. Interconnectedness. So we have our system. Let's just draw it small over here. Right? We have our outputs. We have our inputs and we have our feedback loop. Right. And that goes like that. And that goes like that. Okay, cool. All right, so we zoom out on just the system part. Let's think about it very simply as a line. And there's a line with a bunch of events that happen. And we're going to do it from the customer's perspective, because who are we here to serve? Who do we add value to in exchange for money? The customer, the client, the person who's actually paying for the whole shindig. Right. You're not going to have a business that serves nobody because it wouldn't make sense and it wouldn't be profitable and it'd be a complete waste of time. That's more of a hobby than a business. And there's nothing wrong with a hobby. But we're here to build a business. So let's say we can split this into different phases. So we'll call this attention time and money. We'll call this top of the funnel, middle of the funnel, and bottom of the funnel. These are just some ways that I think about this. These are frameworks. Again, the map's not the territory. But if you have enough maps, you start to understand the territory. So the first thing somebody sees for your business might be an ad. Right? That could be the very first thing. And then they might jump into a lead magnet and then they might, you know, maybe give you an email first. Lead magnet. Maybe they do your nine dollar products, maybe they upsell into 197. You know, they're coming in the middle of the funnel. It's really about, okay, what got their attention enough for them to stop and take an action, give you their email, jump in. They like what they got for their attention. They're giving you a little bit of money. Now they're going to spend some, some time maybe. I think this is the most important. Like these could all happen out of order. Totally. There's different types of buyers, but it generally works like this. If I like what I get for my attention at the top of the funnel, I'll give you more of my time. If I like what I get for my time, I will give you more of my money. People, by and large are more likely to spend time than they are money, even though time is a more valuable resource. That's just how people are. You can't argue with human nature. So time is like where I'm spending time, digging in your webinars, your content, you're, you're, you're going down the rabbit hole on my YouTube, you're watching all my videos, which I hope you are. Thank you for liking and subscribing. You're getting involved because you liked what you got for your attention. Now you're going to spend time. And if you get value for both of these things now you consider spending money. You'll go to buildwithoptimus.com, you'll check out our offers, you'll check out Build a Mastermind, you'll check out my books in the description below, you'll look at all of that, right? And I have no shame about pitching people because at the end of the day, some people write for me, some people are not. But if I don't tell people what the hell I have, how can I ever help anybody, right? Nobody knows until I tell them. So back to this. So every one of these things has a conversion rate, right? So Maybe it's like 30% here and it's like 15 here and it's 50% there and it's 70% here and whatever, right? And on and on and on we go. So every time we make a change, everything is interconnected. So what does this mean? This means that at the beginning of the funnel, if we make a change here, let's say this goes to 35% and it improves all of this gets better. If it Goes down, all of this gets worked worse. It's all interconnected. And if you can improve something even tiny, like 5% here, right in the beginning of this, well, that multiplies. It compounds every single one of these conversion rates gets slightly better. And by the end of all that compounding times, all these steps, it might be two to three times better. Right? That's pretty cool. I love that about business. It's these little compound effects that, you know, little hinges that swing big door. So when thinking about your business and how you're going to optimize the system that it is, I want to make sure that you're focusing on the right things. So some of the rules would be, all right, focus on the front first. I'm going to focus on the front of the funnel, which is going to affect the most number of people. And then I'm going to worry about this stuff, not less, but it's just in order, right? In priority, right. I'm going to make sure my offer is great and all those great things. But, like, once all that's done, this is where people stop. They're like, I got a great offer and I'm getting referrals and I'm getting great case studies and testimonials, millennials. But then they stop thinking about the front of the funnel. Like, how is everybody else in the world that hasn't become your customer yet perceiving what they're seeing? How are you sorting them? How are you meaning their questions? How are you entering the conversation going on in their head? And you need to take this data, these outputs, and you need to move them to the front of the funnel to create better inputs. I have to take this market research. I have to take these case studies, these testimonials, these stories, these objections, all these bits. I have to bring them forward so that the people coming in have a better understanding of what the heck it is I'm doing, right? So the best companies in the world that you see, they create advertising that has testimonials and case studies and all this great stuff, because that's what people want to know. They want to skip to the end and understand, is this right for me or not? Should I give you more than 10 seconds of my attention or any at all? Like, it's. It's hyperspeed now. Like, the second I see an ad, I can tell if it's for me or not. And that's what I want, right? And I think that's a great ad. If I can't tell in five, ten, seconds, I'm out. And if it's not for me in five, ten seconds, I'm out. And that actually is rewarded by a lot of these platforms. So like a YouTube ad, I don't know if it's still like this, but for, for the beginning of YouTube they said, well, TV commercials, 30 seconds, let's give you the first 30 seconds free, meaning they don't even count it as a view against your ad spend until they watch. 30 seconds, that's the craziest deal I've ever heard of. Right? So you get a full TV commercial before they even have to pay. And if you can't decide as the customer in that first 30 seconds and if you can't communicate as the advertiser in that first 30 seconds, who it's for, who it's not, for, why it's going to help them or not, that that should be your ultimate focus, right? Is that first little bit of time. Just get to the point, dammit. So how did I start this video? I said, hey, business owners, that's who I serve. How do you think about your business? Here's a new way to think about it. Is that valuable? Cool. Let's watch a little further. Let's go a little bit down. So here's another cool distinction. I teach all my clients everything that you can eliminate from this and nobody gets this right, so I'm just going to go right to it. But I think it's a really cool distinction. Every time you can eliminate a step, what happen sense to the conversion rate? Well, it's not 10% anymore, it's not 5%, it's not whatever it was before, it actually becomes 100% because essentially you've removed a step. So instead of 10 steps, maybe you delete two. Now you have eight steps, right? So 10 goes to eight. Now you got eight steps and every one of these, no matter what the conversion rate was, is now a higher converting funnel overall, a better business overall. So the simpler you can make a business, the less steps you can get the result, the less steps it takes to get the output, the better, right? So before you change anything, consider eliminating something, right? So here's a great example. I learned this from Tim Ferriss and yes, I've spent time with him and it's been many years, but I learned a lot of great stuff from him and he basically gave me this framework. He calls it deal, I call it lead. Because leaders eat last. It's eliminate first, automate second, it's delegate third. And that's liberating, right? So the lead framework, slightly out of order, is eliminate, automate, delegate, liberate, eliminate simply means get rid of it. If it doesn't scale, if it doesn't help, if it's not adding value, if it's, if it just doesn't need to be there. You don't want to scale an inefficient process. You want to delete anything inefficient. So you know, this might not happen first, but like once you have sort of a very rough system, you're going to first say what, what can we get rid of? Secondly, what needs to happen? What can't we eliminate? But we need it to happen and can be done by software, Automation, robotics. This is where AI and automation come in, right? Then, okay, it still needs to be here. We check this box. Software can't do it. It still needs to happen. Software can't do it. I need to delegate it to a human, right? This is where the humans come in. And ideally you have automation and AI to support them. And then finally you liberate yourself in the system. The system keeps going. It's keep driven incentive, that's fuel, it's worth it for the people who need to manage it and make sure it happens to make it happen. The software all works. There's no breaking. You only step back into the system if there's an issue, if you have to reinstall something or if you have to rethink something. So this is the basic framework by which I do all of this. And thank you, Tim, for that. So that's the one thing we talked about, feedback loops, we talked about interconnectedness. I want to make sure you have really practical tactical strategies to go and do that. So I'll give you an example. Example, in my business I used to do onboarding really haphazardly, right? And I had a client where it just fell off the rails. And I worked so hard to get this client. They just, they hated the onboarding process and they refunded. And this is super early in my career. It really devastated me and I was like, I'm never gonna let that happen again. So instead I made us a better system. I said, hey, listen, every time somebody gets onboarded, we're gonna take the money, we're gonna contract, and second, that contract is signed, we're gonna make sure they get everything they could possibly need. They're gonna get the full kit and caboodle, we're gonna go through a checklist, we're gonna send them stuff in the mail, we're gonna send Them a nice thank you going to happen. And later I had Andrew Cruzy join as a client. He literally got to my onboarding and he was so blown away by that. He started building systems in his entire business and exploded, right? And he, he started digging into the Sam ovens and more of the stuff that I've looked at and like really changed his whole life. So, like, this literally transforms. He ended up selling that business for over a million dollars and doing really well with it, making millions and millions and millions, having great clients. So like, this really transforms businesses and there's no limit, there's no cap to how big you can go if you have the right system in place, right? ChatGPT went from 0 to 100 million users in like three months. I think it might have been two months. It was like some absurd amount of time, right? Because what did they do? They created something that was very applicable, highly applicable to many people. It solved a lot of different types of problems. Everybody wanted it demand, it was easy to multiply, right? It scaled, it was, you know, they were the sole provider at first. I mean, like, you think about trust, had high trust, low friction. Like all of these things came together to become a confluence of like, holy shit, Chat GPT is awesome. Everybody wants it. And now it's like reinvigorated my love of entrepreneurship. Like, I love this stuff. I love building stuff for entrepreneurs. I love helping small businesses to thrive because small businesses become big businesses and they change the world. It's a really important thing. So for me, this is an unlock of epic proportions for a lot of different ways. And they deserve every bit of success they got. I don't need their pro account for most of the stuff I do. I still pay them more money because I feel like it's worth it. Even If I pay 200amonth, 500amonth, 1,000amonth. They've added so much value to my life. I'm able to get stuff done in 10% of the time. It used to take. It just, it's mind blowing because everybody gets habituated to what was so quickly and they forget how it used to be, right? Especially with these newer generations. Like, they didn't grow up in a world without the Internet. Like I did. Like I can remember when I had to do everything by paper and pen. Calculators were not allowed. I had to allow, you know, go to the library to look stuff up. I had to drive places, I had to think about stuff. I had to go and be in solitude in nature and work through problems. I had to worry about crazy assholes in my neighborhood. I didn't have anybody to call. I didn't have anything to figure out. Right. So the end of the day, I had to figure it out. You have to figure it out with the new tool set, and it's shifted, but, like, the lessons are still valuable. Thinking deeply about how you build something is just as important as building it. And you have to be able to balance those two out. I guess that's what I'm trying to say. So next thing to understand here is stocks and flows, right? Stocks and flips. What's the stocks and flow? Right. So people think about stocks and flows in a couple different ways. This is a little bit nuanced. Some people might tune out, But I think it's really valuable because I find myself slipping all the time. I'm great at giving advice. I'm always great at taking my own advice. So don't hold it against me, hopefully. But I actually started thinking about this recently, and I was like, okay, if I were to think about stocks and flows in a new way, how would I do that? So stocks and flows, to me are really a function of Second here. I had this. I had my notes. System. Here we go. All right. Thank you for the patience. I do appreciate it. So the first example of a stock would be like your lead pipeline. So how many leads you have in your pipeline that you haven't yet turned into customers. Second one would be client fulfillment. Third one would be cash in the bank. So let's just do a couple of these right now. So let's do leads, clients, cash. We could say talents could be one of these or like capacity for your team. Right. And these are like different bathtubs or different silos that things accumulate in. Right. So we've all seen businesses have different levels of glut and different levels of dearth, if you will, to use really fancy language or areas of plenty or areas of lack of. And that changes over time. So, like, leads. Sometimes you have a lot of leads, and sometimes you don't have too many. Sometimes you have a lot of clients, and sometimes you don't have too many. Sometimes you have a lot of cash, and sometimes you don't have too many. Maybe more people would like that problem. And then sometimes your team is fully booked and it's crazy, and you're at capacity, and sometimes it just isn't. But every single one of these is like a bathtub with a little faucet on it. Right? Just say that's a faucet, and they flow into the bigger engine, which is this system, which we described before. I won't redraw here, but it's essentially inputs, outputs, system and feedback loops, right? So as we're adding these things and taking these things away and thinking about these things, we really want to understand, like, where is the actual problem? So first we got to map it. So if we map it first, we understand our different systems. You can kind of give yourself a very rough score based on, like, where's my business at? And you can do this multiple times. You can say, okay, well, right now, at this moment, at this snapshot, I have a bunch of leads I haven't followed up with. My clients are in good place, My cash reserve is a little low, and I have more capacity with my team. Right? And let's just say that's the scenario. Well, just based on that scenario, I'm going to focus on closing more deals, right? Because clients are happy. I don't have enough cash. This is low. I can't be sitting around on my ass. I need to go and convert more of these leads. So I'm going to make that happen. Or maybe you have to take a step back and say, all right, I don't have enough leads right now. So none of these other things are full. So I got to focus there. So it's like most business owners I meet, more than half are like, I don't have enough leads. I don't have enough leads. I don't have enough leads. But they're not taking the time to really diagnose the problem. They're not looking through every single part of their business and saying, well, I could probably get more leads more easily if I had a better offer. If we did some more R and D, if we did a little more market research, if we did a little more customer fulfillment and customer work, where we, like, really go into their business and tinker and figure out what's what. I've been doing a ton of that this year. We've identified 31 different tools. We've built 19 of them for small businesses. All AI first principles. Right. I've been taking my eye off the ball on lead gen. Even though I'm still doing it, I'm trying to keep it moving, but I'm not, like, really focused there. I haven't done a big launch. I've done that stuff. And I'm just trying to, like, hit a lot of base hits and keep the cash coming so that I can build something. That's going to be insane, right? I want to build A ton of talent and capacity, better products that could be another bucket, right? R and D products, you know, all that stuff. So that when I finally go hard again on lead, I got something that nobody else has. I'm running my own race at this moment because I'm thinking about this in terms of stocks and flows, right? So I've had to pay attention to the cash flow, make sure that stays stable. All right? Sometimes I got a little wonky, right, Because I was changing my focus. I had to make sure that the leads that I had were being followed up with because I didn't really have a lot of margin for error there because I wasn't willing to invest a ton of money and time into that. I had to make sure that my clients are really well taken care of. So I was making sure to bring them client success people and make sure to, like, consistently check in with people. And I'm only one guy, so I had my team doing this too, and really managing all these different stocks and flows close. So, you know what, if you're in a situation where you have a ton of cash, right? This doesn't mean you take your eye off the ball or you just go on a beach. You're now thinking about, okay, you know, if all things are equal, I want to reinvest this into more leads, which leads to more cash. Like, you got to keep this going at a certain level. If I have too many clients and my team is overwhelmed, maybe I got to slow down a little bit on sales and leads, and I gotta, like, focus there. So this is just another thing that we have to consider as we break the system further apart from. So if the stock is your leads and your inflow and outflows, or, you know, ads, referrals, SEO, traffic, if your outflow is sales conversion churn, like, you want to make sure that you actually spot the problem. Is your inflow consistent or spiky? Is your outflow faster than your inflow? Because you don't want to have a leaky bucket where people are coming in and going right back out again. They're not happy. Is the stock too low or too high for your goals? Is there demand for what I'm selling? Is it even. The thing I should be selling is the thing that people actually want, right? All these things need to be considered when designing a great system. And another thing to consider is like, what's the delay? What's the delay? And so I make a change, right? I go and I get more leads. That's not going to necessarily just become Clients. You know, we got 200 more leads this month for a specific book launch that we did. And, you know, we like the price of the leads. We like this. But now we know, like, we're going to have to wait a little while before this becomes a client and cash and all this other stuff. So basically, when you make a change, allow the change to take effect and plan ahead, because it could take a quarter, it could take a year before you really start to see the effects. Hopefully it's, you know, you have really tight cycles in your business, but that's not always the case. So just be patient, all right? Don't freak out. So let's say I need more leads. I could use Omnisocial. I could use ads. You know, you can check out omnisocial.com watch. There's a lot of stuff going on there there. We help you with SEO. We help you with getting your message in front of more people. We can put you on every single platform every single day and every single method, every single format. Like, that's what we do there. And really, if you see your business as a series of these bathtubs with faucets and drains, you can finally control it instead of just reacting to the water level. Does that make sense? So, like, you're not always freaking out every time the leads are low. You're not always freaking out every time the cache is low. You're just saying, oh, well, where in the system do we not have enough stock? Or we're not tapping into that stock that we already have. You would be shocked how many times I talk to somebody and they're like, you know, are you reselling your clients? No. Okay, we'll start doing that. Start draining that. Right. Are you actually following up with the leads you have? Do you realize how many leads you actually have? No. Are you creating enough content to generate these leads? Are you running enough traffic to generate these leads? Are you paying enough money to generate these leads? Right. Is your team overworked? Do you have the right team? Are they. Do they have consistent quality? Like, where are these levels? So instead of just reacting to these fires that are showing up every single time. Time. What are you actually doing to make it better? What are you actually doing to make sure the problem doesn't show up in the first place? All right, so let's go to the next little thing here. Next thing I want to talk about is the idea of leverage points, right? Finding the right gear to fix in the machine. This is the hardest part for sure, right? If you don't know what piece is broken and what piece is a high priority to fix. You're going to have a real problem. So we go back to our original analogy here. Here we ran our lead framework and we realized, okay, so there's stuff that doesn't have to be here. We eliminated some stuff, we automated some stuff. Now this stuff is delegated. There's high touch here, delegate here. Now all this thing is pretty well working. Then we put a lot more throughput through the system, right? We maximize the throughput, which is another way to say, like we increase inputs to create more outputs, right? Now something breaks. How do we know what breaks? Well, maybe we don't measure what how much we should measure. Maybe we're not reporting at the rate we should report. So this is a very important thing to remember. I'm going to give you a quote. I want you to write it down. What gets measured gets managed. What gets reported improves. And what gets measured and managed and reported reported improves exponentially, right? What gets measured and reported improves exponentially. Because if everybody in your team is on the same page with actually what is, and everybody's incentivized properly based on what they need, right? It's all subjective. At the end of the day, you're gonna have a much better time at figuring out the problems in your business because people are going to stand up and tell you. And as a business owner, you need to get really good at figuring out all the parts of your business so that you know when something seems right and something seems off and when the data lines up and when it doesn't, when you're in KPI and when you're not, that's just a really simple way to understand your very specific numbers for your business. Maybe there's five or less that you actually really need to pay attention to. And the second something's off, you see that, you look at your three to five numbers, you see that KPI is off, you can dig in and find out what's wrong. And that becomes a leverage point. You get to fix that. You have to create it. And on the other side, it's not just about managing downside and risk. When you find something that's really working, holy shit. Do you need to go a bit bigger? Right? Every time I tell people, like, when you get a dollar coming in and like more than $5 is coming out, holy moly. You need to go times a thousand. You need to get as much money through that system as possible, as much throughput through that system as possible. In the quickest amount of time, because that's a leverageable event. Those happen five times, maybe in your entire career. That is the time to go all in, right? And the only time you slow down is when you get diminishing returns. The only time you slow down is when something shifts. As long as that stays true, you keep going. Because at every point in that puzzle, you have an opportunity to make everybody who's playing this game fabulously wealthy in terms of value to customers. They get wealthier in terms of your employees, in terms of yourself. And that gives you more resources, ideally profit, to then reinvest into whatever your next venture is. So I'd rather have you not just limp along to the finish line and get through the race, but dominate, Crush whenever you possibly can and take everything that you have, put it all on the field and take everything home with you, all the accolades and really recreate the game. Not everybody's going to get 100 million new subscribers in three months. But whatever the version of that is for you, you don't need that much success. You just need to go all in on the opportunity set in front of you. And if it's the wrong opportunity set, if you're a level 10 entrepreneur and a level 2 boat, you're trying to a level 2 system or engine, maybe consider upgrading the system, upgrade the opportunity, upgrade the mission, right? Because you can get to China in a rowboat, but there are private jets. I'm just saying. All right, so let's clear this out. So that's really the importance of leverage points. We talked about delays, boundaries. Now boundaries really relate to why systems break. Where you don't define where they start and stop. So when things get too big, we try to be everything to everybody. That gets really messy. You are not responsible for every second of every person's life. You're not responsible for everything that ever happens in somebody's life. You're not trying to solve all their problems because most of their problems are self inflicted anyway. They're problems of perception. They are problems of, you know, non, non objectivity. They're not even problems, they're stories. A lot of them, I'm not saying all, but a lot of them like you got one leg, that's a problem, you can still solve it, but it's a problem. It's how you feel about, it's how you work with it. But if you are a perfectly healthy human being in 21st century America and you're making some sort of income and you have a place to live and food and, and shelters Utilities like you're already doing better than most of human civilization for most of time. Time period, full stop. So most of your problems are. Sorry, they just are. They just are. Right? It's like everything is relative to our current situation. And the worst thing that's ever happened to you is the worst thing that's ever happened to you. So it's not your responsibility as a business owner to solve every problem that everybody ever has. You have to create boundaries. So if you think about this as the timeline and the possibility of every problem that everybody's going to ever have, like you are really trying to solve this one. That's it. And the reason you get jacked up is because you start to bleed. You start to bleed into other areas. You start to make it there when it should just be there. The tighter and narrower we can get where it still adds value. Go all in there. Go as narrow as possible. That's what people talk about when they say niching down. That's what people talk about. And they say serve a very specific audience with a very specific problem, ideally a very qualified audience that will pay for that solution. That's what they're talking about is if you let your boundaries bleed too much, you lose track. Track. So what does this mean? This means you have to get okay. And this is hard for me. I can give this advice, but I have a hard time taking it. You have to allow people to get upset. You have to allow people to have their own experience. And sometimes you become the bad guy in that experience. And that's not because you're not trying your best. And it's not because you don't have the best wishes and you want to have the most value. It's just because you have to come to terms with the fact that you can't help everybody do everything. And sometimes it's better for them to solve it on their own. And everybody's got God in their corner if they want it. I have great relationship with God. I let God sort out the details. Just keep me on mission, keep me on focus and make sure that I have what I need to focus. Right? So that becomes a boundary conversation. I think every great relationship is three things. And this is relationships on a small scale, transactional scale all the way up to like really high value. Relationships with investors and clients is like agreements, boundaries, which we just talked about, and clear communication. Every time you're having a people problem, it usually falls under one of these three categories. There is no clear agreement. So this is versus expectations versus stories, versus perception, versus Any of that. Now what do we agree to? That's what we're going to stick to. Boundaries is when people step over that line, you or them, this is when they start to ask of you things that are not in the agreement or expect things from you that are not in the agreement or snipe you for that you never talked about or because they have some issue that they're taking out on you because it's a failure in responsibility. They haven't taken 100 responsibility for themselves. So every conversation that I have with a client that begins a relationship, it's like I try to remind them as consistently as possible, as lovingly as possible. It's like, hey, I'm going to clearly communicate this to you. We have an agreement. We have boundaries, we have clear communication. And I have a way I operate. I will always communicate. I'm not going to leave you hanging. And all I ask is for the benefit of the doubt. Like, just don't make up a story about me that's not true or not kind. You know, I'm trying to be your friend, I'm trying to help. And at the end of the day, I got my life, my business, and all the things that you're dealing with on top of all the things that I'm dealing with and they're similar to the ones in your life. And I'm sure that if you were just to come into my life and look at my problems and we put them all in a circle and everybody else who we deal with is like, we'd all want our own problems back. We're all here to do a specific thing, so try not to lose sight of that, that we're all humans doing our best and it's empathetic. And the more we can really hash this out ahead of time and really notice when people are like, hey, I need this. But that's not what you agree to. We call it out right then and there so there's no like friction on either side. It just becomes a lot easier. So agreements, what do we agree to? Let's get it in writing so it's not hallucinated later. Boundaries, what does that actually mean? How do we separate professional and personal? And I work with a lot of my friends. It's kind of a running joke. It's like, if you're my friend, I'm going to pitch you at some point because that's another level of friendship to me. It's like, yeah, we're exchanging value. It's not just a fly by night thing. If I truly want to help you. You need to pay, to pay attention and to get the value. That's it. That's how I work. I can't give you a ton of value for free forever and expect that you're going to get what you need out of of it. Because I can't pay attention enough to things that aren't paying me to really give you everything I've got all the time. It just, it's not sustainable. Right. I need to have boundaries in my own life. And same on you. Right. It's like, and this typically becomes a mismatch when people don't value their time as much as they should. And I'm going to clearly communicate in a transparent and ethical way as much as I possibly can. Does that mean I'm not going to influence and persuade you to drag you kicking and screaming into your greatness? No, it doesn't mean that I'm still going to do that because I think that helps you. And it's also, it's a collaboration. Right. It's like you need to show up 100, I need to show up 100. You need to take responsibility 100 for you, I need to take 100 responsibility for me. What I can control, what versus what you can control versus what can't we control is the third thing that now we can turn our energy on that instead of fighting with each other. Right. And let's influence that together. Okay, So I think that's a good diatribe. Thank you for coming to my TED Talk. We got two more quick ones. Really? One, I'm just going to stick to this and we'll wrap it here. Systems goals versus park goals. So we had KPIs whole business. Now let's kind of break this down into a little bit more project based. So just systems goals versus park goals. What's your goal for the whole system? I want to make a million dollars a year. That's what everybody tells me. So I'm just going to go with that. Okay, great. And what's your part goals? Okay, well, on my leads front, I need to do xyz. I need to do something xyz. On my sales side, my upside, I need to upgrade my offers. Right. So these become parts goals. And the more clear you are about the system as a whole and how all the parts work together and all the goals for the parts and all the goals for the system, the better time you're going to have. How you think the system works changes what you fix. So make sure that you're Always paying attention to what's actually working and you're tightening what works. Your flexibility. You have resilience and adaptability. You're really paying attention to all these pieces and you're not missing anything really important. Important. So remember, inputs versus outputs, stocks versus flows, feedback loops, leverage points, delays, sub optimization. You know, let's say in a business we added automation too early. We broke fulfillment. It turned leads. Right? Those are things that come up. Or, you know, maybe we had the simple SOP and feedback loop. We freed up 12 hours a week and we invested that time into content. Right? We made the engine bigger. We. We increased the input. That's a positive outcome. You know, finding the right leverage point. Sometimes that could just simple as changing the pricing model and we could double mrr. We didn't change the offer, we didn't change how anything else happened or even how we communicated it. We just changed the price point. You would be shocked how many times I just come into somebody's business and I help them raise the price and they give themselves a 30% raise and they don't have to change anything else. They just made it more valuable and got better clients. Blows my mind every time. I just literally, I want to create a consulting offer where people pay me $10,000. I tell them to raise their prices and get the hell out of my life and they'll make it back immediately. It's a huge roi. All right, so thank you. Thank you for being here. Thank you for being an entrepreneur. Thank you for fighting the good fight and trying to make the world better for more people again. Start to think about systems in terms of leverage. Start to think about systems in terms of incentive, and I think you'll do way better. You may have to revisit some of these points if you check out thinking and Systems. I think it's a really worthwhile read if you can get through it. It's not for everybody. It's a little bit dense, but it's still a great book and you can take a lot of these lessons forward and make yourself a better business. The stocks and flows one is one I have to come back to again, again and again. What am I actually working towards versus what am I just maintaining versus what are my systems goals versus my part goals and making sure that I'm actually doing the things in the right order. So I hope you've enjoyed this video. Like and subscribe. Check us out at the links below and I will see you next week. Happy Monday. All right, take care now.