Brutal Leadership Advice on Becoming The Chief Energizing Officer

When you can get every business area lead to remember that their most important team is the company as a whole, and their second most important team is the business area that they're running, that's when the real growth starts to happen. Our role as CEO is to be the chief energizing officer. Even our role as the second in command is, what kind of an energy are we going to bring into the organization today? What kind of an energy are we going to bring to our team today? And are we draining the group or are we raising them up with energy? Years ago, when we were building college pro painters, we were taught what was called the sidewalk rules. And the sidewalk rule was, when you were driving up to the homeowner's house to do the estimate, and you hadn't even met the homeowner yet, how do you prepare yourself to walk in the front door to literally grab them right away? Right? So the first thing we would do, getting out of the car, it was we would make sure we had all of our material right so that we didn't have to run back to the car and look unorganized. So do we have our color fan? Did we have our presentation manual that they could look through with all of our reference letters? And then we would walk up to the front door, and as we were approaching the house, we would look at the home and we would picture it completely painted so we felt really good about what the house looked like. And we'd literally take them outside and go, I want you to picture what this looks like. I was just thinking about your home and what it's going to look like completely done. And we kind of rip them into the future. And that's an energy shift. And I think with us as CEOs and CEOs, it's what can we do on that daily basis to shift the energy in the room? How can we show up for a zoom call and shift the energy? How can we show up to a physical meeting and shift the energy? What can we do with a loom video or with an email message? And being very intentional with that. I'm often very short. You know, Meredith has worked with me for eight years and has been on the receiving end of probably a ton of messages that are very short. But I think she knows me well enough now that she doesn't take any of them personally, or hopefully not. But I'll be like, what the. With this? And it's not like I criticism. I was just like, what the with this. So what I've learned, though, is to drop emojis and smiley faces into my written communication a lot more to try to soften me up a little bit because that's an energy shift. I remember one day at 1-800-got junk. I was running a daily huddle meeting. We've ran daily huddles for years. And I got frustrated because at the end of. So there was a section called good news where we would share kind of updates and projects that got completed, and somebody's birthday or somebody would read a snippet from a customer service email. And at the end of each of the little bits of good news, people would clap. And I'm like, stop with the clapping. Like, it's the good news section. We know it's supposed to be good, but if you clap after six pieces of good news, that's like five seconds times six pieces. That's a total of 30 seconds times 140 people that are standing in this meeting, multiplied by their salary, multiply that by 220 operating days. Clapping is costing us $76,000 this year. And I kind of delivered it in the wrong way, and it sucked the energy out of the room. I was right in trying to show them the. But what I could have done was said, hey, I want to show you guys a cool exercise. I was thinking about. I was thinking about the cost of meetings and how we can actually be more efficient in a company. So let me give you a cool example of what I was noticing. Let's say, for fun, that we're just looking at the cost of clapping in a meeting. I'm not saying we want to stop clapping. Like, you see the difference of me approaching it. I'm. Because I didn't think about the energy shift that was happening. I probably destroyed the energy in the company for a good solid week. Because what 140 people took was the CEO was pissed off at us, and then they took that back to their desk and they took that back to their emails. They took that back to their customer relationships. So for us as leaders, it's how do we think about that energy shift and us as the chief energizing officer. The last part of that is, and I know that mayor is an example, how. How many times a month do you tell your husband that you love him or. No, not even a month. How many times a day? A lot. Every time the phone, when he leaves for work, when he gets home for work, bedtime, and typically when he wakes up middle of the night and I'm still at my computer working, I just look over. I'm like, I miss You. So like, multiple times a day right now, he already knows you love him, right? Mike knows you love him. You've been married forever. You're running a farm, you got kids. Like, he's clearly aware that you love him. You could probably go for three months and not tell them, but that would actually destroy the relationship. Because if you didn't tell him you love him, then that one fight that you have, and you have fights, you've got disagreements, I'm sure, right? Lots of stresses in life. But because you've deposited all the love into that jar, the one fight that you have doesn't take all the love out of the jar. Well, I think with us as leaders, Jake is an example. You run divisions in Cincinnati, you've got teams in Colorado Springs. George, you're running off of multiple locations. When you go into a location and you show people with love, the stuff to fix, the stuff to clean up, how to sell better, how to deliver more marketing, how to upsell, how to price better, all the good, normal, absolutely positive things that we should be showing them. If you don't tell them what they're doing well and show them what they did a great job with and thank them for living a core value and praise them for the three things that were last time that looked great this time, all the stuff that they should already know. If we don't remind them of that and show that praise and love bomb our employees, what they feel like is, we're never going to be able to please you. All we keep showing them is all the stuff they're doing wrong that drains them of that energy. So for us as leaders, it's about showing gratitude, praising our people. It's kind of like the one minute manager, the two strokes for one, poke the shit sandwich. It's always finding ways to praise them twice as often as we give them new projects or criticize. So what I try to do is every time I have like three new projects that we're rolling out is, how can I say thank you six times? Or if I find three things we have to fix, how do I say six things that are doing great? You know, I've got an employee on my team who's been with us for about six years, and I come down pretty hard on him with stuff because he's always working on things around the website. And I'm like, this sucks. This looks like, how come we can't fix this? But then I'm also become very cognizant of, oh, shoot, I know that he's getting a Little bit nervous or a little bit drained. So then I just love bomb the out of him to make sure that he knows that I'm very happy and very pleased and his job is secure. And I really, I'm happy with the work that he's doing and I want to give him more meaningful stuff. And then he feels really good again. It's us kind of thinking that way and being cognizant of that. That's powerful. And I'll tell one last story on this and then we'll open up for Q and A. When Howard Behar was CEO, he would spend two hours every single Friday handwriting thank you notes to people and to stores. Two hours every single Friday. So that's approximately 5% of a 40 hour workweek that you've got the CEO of a. 14,000 unit locations. 14,000 locations handwriting thank you notes. But he didn't know who to write notes to. So what would happen is Friday morning he would get to his desk, there'd be a stack of thank you notes on his desk already pre addressed, and there'd be a spreadsheet. It would be store number 1100, the Frappuccino Record. Dan McGaugh, sales record in the state of Washington, Miami. Frappuccino record to George's five star location, whatever. So he'd sit down and go, george, congrats on the Frappuccino record in Miami. That's amazing. Howard. Dan, congrats on setting the sales record in the state of Washington. Store number 1412. Congratulations on your 17th year in business. And all he did for two hours every day was write those notes. He had stores and employees that when he would go out in the field or when the regional managers were out, they'd say, oh, we saw your thank you note that you wrote to this store. It was, it was up on the bulletin board in the staff room. Think about ourselves for a second as leaders is how often, like Jake, how many people are in your downline that you manage? How many direct reports and how many people report to them?

We got seven direct reports and underneath them there's about 65 people.

So with 65 total employees, how many people did you say thank you to or praise in the last seven days?

Two.

Specifically two out of 65. The reality is we need to be hitting these people on like an every week or every two week kind of basis or cadence. We need to find a way to somehow praise people. You need to have the front line trickle up to you to let you know who's living a core value, who's delivering a result, who's knocking a project off, who's doing a great job with something. And then when you're out in the field, like when you go to Cincinnati next time, do you know who your five emerging leaders are or three emerging leaders are in Cincinnati? Actually? Yes. Then you know those are the people that you want to, before you get there, have lunch already set up so that you're taking those three people for lunch at the same time. Or take five people, you know those three. And they each get to invite somebody. So maybe there's seven of you. Those kinds of things pay off massively. Like, wow, Jake's coming in from Colorado Springs and he invited us for lunch and we get to bring somebody to. That's pretty amazing. You're going to eat lunch anyway. And half the time all you need to do is just sit down and say like, what's going on? Tell me about your job. What do you think we can do better? Where do we suck at the head office? What are you noticing with customers? How's it going? How's your family? What's on your bucket list? What we don't realize is we wake up in the morning thinking we're just some guy who had a shower and took and put our clothes on and went to work. But for them we're this role model or our title carries a lot of weight. Any thoughts around that or questions around that stuff?

I actually love that you just brought it up. Cause I'm going out to Cincinnati at the end of next week. I really want to do this because specifically just talked about a couple emerging leaders as we grow and develop that team that I want to highlight next week. While I'm out there now, this is like hitting the nail on the head right now.

I used to have two things in my calendar two days a week and it was on Tuesday and Thursday. I had a 30 minute time block in my calendar and it was called MBWA, which stood for Management by walking around. And we had 60,000 square feet at 1-800-got junk spread over three floors. 248 people at the head office. And I would just take a different path and go and chat with people. I'd go down a set of floor and I'd sit down beside them. As I said, I wouldn't come walking in as this big tall guy. I would come in and kind of crouch down on the floor or pull up a chair or sit on the side of their desk. I'd be like, how's it going? Tell me what you're working on where do we suck? I'm interested to see how this is doing or show me those metrics. But that different path through the office connected me with the whole team. The second thing that I did was every Wednesday, my EA set up a lunch for me and five people at a Greek restaurant a half a block away from the front door. And we would literally walk around the corner, and it was me with a person on each side of me and three across from me. And one day it would be all women. One day it would be all guys. One day it would be all marketing people. One day it would be all it people. One day it would be a mix. One day it would be all new people. But it was five people every Wednesday for about 18 months. And it was just me doing a skip level to be able to ask questions and listen and talk about stuff that we were working on. Just get to know people and connect with them, and it worked out pretty well. What other questions have we got?

I did have a question going back to even, like, the manage by walking around, you know, I naturally.

Going back to your point in regards.

To, like, size and making not being intimidating, right? Like, naturally, I'm covered in tattoos, so I can be naturally intimidating through that. But one thing that I always am trying to focus on and you talk about this management walking around, right? Is how do we make ourselves one more approachable so people feel comfortable being able to tell us bad news, which, like, at the end of the day, the CEO always hears everything last. But even in that situation, like, when you're walking around and talking to different team members, how do we consistently make it so that they feel comfortable confiding in us or being able to tell us bad news? Like, are there things that you have seen that have. Have helped do that?

Right?

Because, like, I'm a pretty overall nice dude. Like, I'm very patient. Like, I'm not the type of. Well, I'm covered in tattoos. It may look intimidating.

I'm a big teddy bear.

But at the same time, it's really hard to tell your. Your CEO that you're maybe two levels away from, hey, this on fire over here, right? Like, how do you maybe always encourage that?

Okay, so there's a couple parts here. One is how do we seem more approachable? And then the second, how do we kind of keep that kind of open doors that people come to us? A third part is how do we do it when we're remote, right? How do we do it when we have remote teams, when we're. How do we build this kind of open door culture and this approachable culture and love bombing people when we're over zoom and we never see them? One thing on the tattoos part is I would cognizantly, fairly often, either in groups or one on ones go, hey, I notice I'm all tatted up right now. I just want you guys all to know I'm pretty lovable. I'm a big teddy bear with tattoos. Just kind of do the pink elephant in the room, right, like you just did with us. It's amazing when you just humanize everything and just kind of laugh about ourselves in it and because that's not going to diminish you as a CEO, it'll humanize you as a person. One thing that I think has been pretty amazing for us over the last 15 years is the advent of social media. You know, before social media, none of the employees knew anything about anybody that they worked with. Now with Facebook and with Instagram, they can actually see a little bit of our lives, right? They can actually get a little bit of our humanity and they can kind of see who we are and what we are. So I think being very open on social media is for sure a good one. Right? That's something that can be very powerful. I'll share something with you that I share publicly is I've written a vivid vision for my company, but I've also written a vivid vision for me as a person. And then my wife and I have written a vivid vision for our marriage and we share those with everybody. So imagine if you wrote a vivid vision for you, or if you have one for you and your spouse and you actually rolled out who you are and what you're working on, that makes us very approachable. Another one that makes us very approachable is just when we say, you know, we tell people what we're working on doesn't have to be what you suck at, but you talk about. Because if it's just like, I suck at this, that's great. They already knew that. But if it's like, you know, here's something that I'm working at getting better at, they're like, oh, so you suck at that and you're getting better at something. That makes it okay for them to suck at something and for them to work on something that humanizes dress code. But I mean, we've kind of gotten away from the whole jackets and suits and that kind of stuff. One of my biggest pet peeves around doctors, you know, physicians, anybody, dentists, is when they have their staff call them. Dr. So and so I still really. And I've talked, I've coached a number of people that are in the physician space and the medical space. I'm like, you know what, drop it. You're Fred or you're Kelly. We're not going to call you Dr. Fred or Dr. Jones. Like you're just going to be Fred like everybody else is. It's something that's hard for them to get over, but when they just become like everybody else, they become very approachable. So that's one emeritus has dropped me a note that we actually had a speaker who was the head of culture at Zappos. And he would go around and ask employees and he'd say, what's one thing you need to tell me that you think I don't want to hear? Richard was one of our past CEO alliance speakers, again, the head of culture at Zappos. But that's a really interesting thing. Is what's one thing you want to tell me that you don't think I want to hear? It's just asking those tough questions. There's an old saying that God gave us two ears and one mouth and we need to use them in the ratio that we were given them. I think there's something very powerful there. Right. We need to remember that our job is to listen, not to talk. And when we just say thank you, it allows our employees to share more when we. Yeah, but them if. When we take their idea and we argue with it, and I'm guilty of this often where I just want to share my thoughts, it's not relevant what my thought is. What's relevant is that I hear that person's idea and I just sit with it. It's kind of like the old joke about, you know, husbands and wives and, you know, we're not supposed to solve women's problems, we're just supposed to listen. Have you ever seen the video of the nail? The girl with a nail in her head here's ever seen this? It's not about the nail. It's this girl who actually has like a 4 inch nail in her forehead and she's complaining about the pain and the aching and her husband's like, well, maybe take the nail. And she's like, you're not listening to me. And so he's like, oh, that must be really hard. And you know, her sweaters are all snagged. And he's like, just nail it to your head. Our job, when our employees come to us and talk to us, is just to say, oh, that's interesting. Thank you. Or I appreciate that feedback. Thank you. It was not relevant what we think of their idea. What's relevant is that they had the comfort to come and say that to us and then we were able to give it back. Another thing that works really well, and this works well in person and also over zoom is the leaders should speak last. That means that when we ask a question of the group, our job is to shut up and let them answer. When we're brainstorming as a group, our job is to shut up and let them answer. Remember, our job is to grow our employees skills and to grow their confidence. But we can't grow their skills or their confidence if we're giving them all the solutions or if we're giving them all the answers first. And normally if you let your employees share the ideas, they come up with really amazing stuff that they can say and all of those amazing ideas that they can say and becomes points that we can actually put in place. And at the end of the meeting if like six people have shared and none of the ideas are as good as you want, then you can share your idea at that point. But quite often you'll hear the ideas of the team. You'll be like, that's amazing. Let's go with that. Now all of a sudden, Bob feels validated, Bob feels heard. Bob feels happy that this, that Dan really likes his idea. So that's a good way to be able to do it. Then lastly is kind of the art of the skip level meeting. The skip level meeting is when you're going to go and skip over one of your direct reports and meet with their team. So let's say you've got a head of marketing that reports to you. You're going to go meet with everybody in marketing without the head of marketing present. Your job is to ask questions and listen. And when they give you the responses and the answers, your job is to say thank you. That's interesting, but not oh my God, we have to fix it or holy, that's terrible. Or I'm going to talk to your boss. Because there's always two sides to the story. If you jump on it too quickly, you might actually be wrong. So as an example, what color is this book?

Black.

Are you sure?

Blue.

Could be fuchsia. Are you really sure? You just told me it was blue. Why are you laughing? What color is the book now? It's white, right? It's the same book. That exercise is so powerful to do with your employees is to show them there's two Sides to the story. When you do a skip level meeting and your marketing team is telling you everything they see, I guarantee you the director of marketing has a very different perspective. Neither of the perspectives is right. The book is actually white and blue. But if we as a leader say, oh my God, the book is white, we have to change it. And then we go and talk to the director. The team's already heard that. We believe them. The director goes, no, there's another side of the story. Now we're like, why doesn't that know that? Well, your job in the skip level meeting is to ask questions and listen. Your other job in a skip level meeting is to tell the team things that you're thinking about and to ask for their feedback. It's like, hey, I'm thinking about this as a direction for the company. What do you guys think? Again, that's ask questions and listen. But you can solicit feedback and listen. Those are some ways so that you can definitely build the trust and build the open door. One of the biggest things that we have to do as leaders when we have the open door is to not create a permission culture. And what I mean by that is to not create a culture where people are telling us stuff so that we have to give them permission to be able to go do something. So it's like, if they come and say, like, I want to do this, this and this with our marketing, our job is not to say yes to that. It's to say, well, are you prepared to live with that decision? Oh, I don't know. I want your opinion. Well, go away and think about it and come back and tell me. Or if they come to us and say, what do you think I should do here? Our job isn't to give them the answer. Our job is to be able to say, what do you think we should do? They'll often say, I don't know, I haven't thought about it. Well, then go away and think about it and come back and tell me what you think we should do. When they come back and tell you what they think we should do, then just say, then go do it. Right. Our job is to grow their confidence in their skills, which means we have to help them make their own decisions. We have to help them go think about stuff and make the decisions. We also have to help them to make decisions based on their core values, based on their roles and responsibilities, based on the budget approval that they've got. People have to be able to make their own decisions. So years ago, I had somebody that I really wanted to hire. I had a VP and a director that were kind of intimidated by this guy in the meeting, and they said they really didn't want to want me to hire this person. And I realized that the person's culture was so strong that these other two were kind of intimidated by him. So I went and talked to the CEO about it and he said, well, you're willing to stake your job on it. Would you really hire this person? When they said no, and I'm like, I'm willing to stake my career on it, he goes and hire him. Like, if you feel that strongly, then make the call. Instead of him telling me what to do, he basically just asked me the question. I think that's something that we have to do as leaders with our team is grow their ability to make decisions and grow their confidence to make decisions and not make the decisions for them. Let me tell you the Starbucks story and then we'll open up for some more questions. So years ago, this mentor of mine was being groomed as the COO at Starbucks and the CEO called him. The same CEO, Howard Behar, called my mentor Greg and said, greg, why is the letter B on the sign at 50th and Wallingford in Seattle not working? Greg said, I don't give a why the letter B on the sign at 50th and Wallingford and Fremont's not working. Howard said, well, you should. Greg said, no, the leadership question that you should be asking is not why that letter is not working. Howard said, well, what's the leadership question? Greg said, the leadership question you should ask is what system do we have in place to ensure that every letter on all of our signs at all of our locations is always working? You know, George, you think about with five Star, it's like, why didn't we upsell that customer? Well, what system do we have in place so that we upsell all of the customers at all of our locations? Or why didn't we xyz? Well, what system do we have in place to ensure that at every store? We took that idea from Greg and we put a system in place that we used to call Bob proofing something. Now we had a franchisee who was the first franchisee ever at 1-800-JUNK. His name is Bob Hartle. Great guy. Probably wouldn't have been awarded a franchise after we'd sold the first 50, but he was certainly good enough to be number one. He was a guy who wanted to buy a franchise. He was going to work hard, go for it. So he had kind of average skills. He was in a shitty market. He was in Buffalo. And the weather in Buffalo from basically November until March is like six feet of snow. So he had horrible weather in a pretty bad market with an average franchisee. So what we wanted to make sure was that we had the systems in place that Bob's worst employee in February in Buffalo could execute the way that our best person could in our best market. That was like a system that we put in place. So those are things that you want to think about inside of your company is the systems questions.

I believe it was Dan or maybe Jake that mentioned how do we make ourselves more personable with. With our team? And it's easier said than done. And it's difficult, right, because we started this conversation with the whole 6 foot 5 and being intimidating. And I realized that with my kids as well. When you approach them, you know, if I get up in your face, it's gonna. But it's funny because you could use it to your advantage if you surprise them with kindness and a smile. I realize that, you know, as maybe my size might be intimidating. I walk into an elevator and I smile and I'm the one that says, good morning. Then everybody's surprised. Everybody thought I was going to kill them. And then all of a sudden I'm the nice, educated one that said, good morning everybody. And then it's like, hey, this guy is. And you do that with your team and it works. You know, they realize that, okay, he's the boss, he's the owner, whatever. There's that Persona that, that I wish wasn't there, but it's going to be there whether we like it or not. It just comes with the rule. But if you're aware of it, then you can use it in your favor. And not that it's easy for me or that I mastery. But I'll tell you any time I've got to address my team, whether it's a group of five or I'm talking to the company. When we did the Vivid Vision presentation last year, I prime myself and I get myself in a state of gratitude. And all of a sudden I'll go in there and that's what I will transmit to them. And I think I shared with you, Kamri, when we did the presentation last year of the Vivid Vision we did. You remember we did that survey that you taught me to ask one question. Then we scored, did the presentation and then I ran the survey again and we scored higher. And I used that like reassurance to myself that that we had delivered it in a proper way. So anyhow, I guess what I'm trying to say is, doesn't matter what's in our mind, what stresses we have, taxes, a lawsuit, bills, whatever. When we go address our team, we need to prep ourselves. And just yesterday I was having a meeting with some upper management. It's easy for me to nitpick and find areas where our stores could and should be doing better. But then as we had been doing that for a little bit, I said, all right, now let's bring it back and give me. Let's think of three things that we're grateful that our team does have. And then we ended up naming off like, I don't know, seven, ten of them, I don't know how many. And that's something that I want to adopt for every Monday before we talk to our management team. Maybe the upper management team should, in our pre meeting, one of some things that we're grateful, some, some talents that they have. So that when we pop up under zoom, I think our body language, our facial expressions, our energy will be different. And I believe we'll get a good return on investment on that. So again, not that I mastery, but it's just challenges that I've recognized that, that I need to constantly manage myself on.

George, I think that's great. I love that you've got the team, a leadership team, doing it in a way that it'll kind of then trickle down through the organization like a waterfall or the butterfly effect. Years ago, I was coach company that underrank the number one company I work for in Florida. It's called bluegrace Logistics out of Tampa. When I was coaching Bobby at the leadership team level, they'd started to break into silos. They started fighting and kind of pointing fingers at each other. And they just weren't, they weren't gelling as a, as a team. So the second thing that we did was get at every meeting that the leadership team was present at, each of the members of the leadership team had to say thank you to someone else on the team that they were grateful for or someone else in the, in their business area. So it might be like, hey, George, I know you run marketing. I wanted to say thank you to Kelly who works for you in marketing because she crushed it on xyz. Then George might say, that's amazing. Thank you. I wanted to point out to finance because somebody in finance did something for whatever it was that one gratefulness that they had to find. And it wasn't like sometimes one business area didn't get any. But it was saying thank you and being grateful for another business area at the start of every meeting. They did that every week for 52 weeks. Massive changes in the company. The first thing that we did was I gave them a kind of an analogy. Who watches football? Dan, favorite football team?

Steelers.

Steelers. All right, so we got Pittsburgh Steelers. Let's say you've got the left tackle, right? He's on the defensive line. Left tackle. What's his most important team? I guess for the Steelers you've got the offensive team, the defensive team and the special teams. What's the most important team for the left tackle?

The Steelers.

The Steelers. The problem with most companies is the head of marketing thinks his most important team is marketing. It's not. It's five star jewelers. The head of finance thinks their most important team is Binance. It's not. It's five star jewelers. The head of operations thinks the most important team is operations. It's not, it's five star jewelers. And when you can get every business area lead to remember that their most important team is the company as a whole and their second most important team is the business area that they're running, that's when the real growth starts to happen.

I did want to throw out Georgia had said one of the things in regards to like being grateful and stuff like that, you know, naturally I would say that I try to be very grateful in like all the things. However, I did notice for a period of time that I wanted to make sure that my team knew that I was grateful for them. And a big thing that I worked on. I don't meditate as much as I used to right now, which I need to get back to. But after all of my meditations, I had three things that I needed to be grateful for. And there was a period of time where two of those things needed to.

Be a team member in the company.

And that really helped me. One, it was grateful for something that day either way. But there was two people in the company. I had to think of something. I was grateful for them for doing something. And then I would also try to make it purpose of mine to go tell that person whenever I could. And I started to identify that I was not capable of meeting with those individuals because there's too many of them. So what I've resorted to is sending them videos from my phone so like different people will get a video from me on my phone. Be like, hey, I would love to be able to tell you this face to face, but it's going to be six weeks before like we have alignment. So I wanted to send you this and you know that thing you did here I was very grateful for. So that's just something random that worked for me for a long time. I want to get back into that routine. I think I'm failing at that right now. But I think this is a great conversation to get back into those habits.

Great. You know, a good system can also be just to put it in your calendar as a five minute reminder every day to do one, you do one a day or to have your assistant line up. But I worked with Marcelo Clare who is the CEO of Sprint. I was coaching Marcelo and I was also coaching Jamie Jones, the CEO for 18 months. And one of the things I said to Marcelo because he was really a hard driving CEO at Sprint trying to do this massive turnaround. He was not a Sprint guy. He built a billion dollar company that he sold to Softbank. Masa appointed him as the CEO of Sprint to go in and turn it around to do the merger with T Mobile. But Marcelo was like this hard driving, hard nosed, 6 foot 7 big leader. I'm like dude, you also own the Bolivian soccer team. You also own the Miami professional team now with Beckham. Like you know that in sports you can't be the hard driving coach. You need to also cheer, cheer people on and slap em on the ass or coming off the field and high five people and kind of get them all riled up. Send your team some videos once in a while. Like instead of doing your text messages which can come off the wrong way or even audio messages, just do some video messages. And this was 2014 or 15, probably 2015. Those things are huge. And to be able to build back into your systems and I think we often think that it's harder than it really is. But saying thank you and showing gratitude and putting a little bit of humanity on and then showing the smile like that stuff's easy. Brian at Got junk would routinely used to drive you crazy because I was like this straight laced, like pretty focused all the time that back in the day Brian would show up in like Halloween costume on like July 7th, you know, he'd show up on November 15th dressed as a pimp. I'm like dude, what are you doing? Like he just was like wanting to make people laugh. And there's nothing wrong with just having some effing fun because at the end of the day none of this matters. It's just what we do to make money. I just got off a call with A CEO that I was coaching in El Salvador. We had a great call and he said he was really struggling with some personal stuff and a family member that's pretty sick and really draining on him. And I said, I need you to remember something like you're the CEO of a company and it can afford to spend whatever you want to make this problem go away and it's still emotionally draining on you. But imagine Kelly, who's a call center agent that's going through the same thing. Or imagine Dave, who works for you in finance that's going through the same thing and no one cares about them and no one's actually there to help them remove the obstacles. So I think it's important to remember that every employee on any given day is probably struggling with something, either a personal issue, an issue with their kid, an issue with the spouse, with money, farm animal that dies. There's always something out there that is going to have to weigh on people. And it's for us as leaders to be very cognizant that our people are struggling and to care about them. If we care about our employees and really care about their personal lives, they're going to go through brick walls for us to build the company. Mostly because there's nobody out there who's actually caring about them the way that you end up caring about them. It's just a huge opportunity to be very cognizant of that and try to bring that into a day to day. In kind of all of our interactions.

We got a question's kind of, kind of going to shift the conversation a little bit, if that's all right. Yeah, it's mature around more around like branding. I'm kind of curious what, what other companies have done in regards to branding. So at wishing you well, we're. We did right around 60 million in 2023. We're slated to do about 85 this year. And we have essentially like zero branding whatsoever. Zero marketing whatsoever. Us on the leadership team, we have the idea and the thought that yes, we're kind of at that stage where we need to start investing in marketing and really starting to get our name out there so that anyone that we ask can tell us what it is that sets us apart right now if we ask someone no one really knows. Our website doesn't do a good job of explaining that. We're kind of battling right now between like a grassroots sort of a thing where it's more referral based and we've got our sales team just like knocking on doors and reaching out all the time and investing that way versus like spending money on advertising and marketing. Really like probably bringing in a marketing agency to help us develop that. Right now it's difficult because we can't say the roi and that makes it really hard to justify the spend and that's kind of where we're landing right now.

My, my starting point on this would be to for sure do an overhaul of the company website. But before you do that, it's to talk to all of your customers to ask them what is it about wishing you well that is important? What is it about wishing you well that they like, like really understand from their perspective what you are and what you mean and really write it from their perspective. Right. Because it is supposed to be about them, not about you. That's number one. The second thing is to remember that on our, at least on our company websites nobody has time to read all the information that we put in front of them. So really think more like Apple and really get it down to the critical few words and the critical few points. It's one of the things I worked the hardest out on our co alliance website is just cutting stuff and cutting stuff and cutting stuff. Like constantly cutting, I'm almost never adding. I'm just like cutting and cutting and cutting, trying to get it down to the critical few. So that would be a second one third is to just think about, I think you kind of touched on it is why are you doing it right? Is it to build the brand? Is it to build connection with your customers? Is it to gain more customers? Is it to, you know, wrap the company up in a blue box and a white ribbon so you can sell one day? Is it to make the CEO feel good? Like what are the reasons why you're doing the brand exercise? And then if you do it from that perspective, you know, it'll start to make sense. As an example, I'm not sure that you should spend a second on any social media because the reality is your, your customers, your decision makers aren't going to be on social media giving what wishing you well or Tyler says. But they might listen to press releases. It might be if you guys can generate and I've got a great agency that could work with you guys on just PR out of Canada called Talk Shop. And they've got a hundred people on their team. I know them very well. Their foundry used to work for me 20 years ago. But if you could get a good PR agency doing traditional and digital PR that was B2B that was around your industry, that could be quite Powerful. What are some of the other reasons why you're thinking about it?

I'd say really right now the main reason is it's to bring in clients. But more than anything it's to describe what it is we do. There's a million Amazon agencies out there, but everyone is slightly different. And we don't do a good job right now at explaining what sets us apart from any other agency. If you look on our website right now, we talk all about our people and our culture and that's great, but that's not going to get someone to sign a deal with us, to work with us necessarily. It's like icing on the cake, right?

I went to a. This is back in the got junk days. I went to probably one of the most boring conferences in the history of boring conferences. It was called Waste Expo. It was a 5,000 person conference for garbage company owners. Like it's all these six foot seven mafia guys talking about garbage. It was horrible. But what I realized was at every conference, at every trade show, at every business event, there's media. And in every industry, yours included, there are a number of trade journals, trade magazines, trade websites, trading scenes, whatever. There's even trade Facebook groups, I'm sure, social media pages, there's trade podcasts for these industries. So what I did was two weeks before the conference, I had one of the girls in PR for me, Lindsay, phone all the trade journals and say, I know you're going to Waste Expo in two weeks. Our coo Cameron will be there talking about a new partnership. Would you like to meet with them for coffee? The day the conference opens, all four of the trade journals said yes. So every hour for the first four hours of the four day conference, before they'd met anybody else, I sat down and talked to them about the partnership deals we were working on. Now these are the partnership deals that I was pitching at the conference. I was trying to find some garbage companies like Waste Management, BFI Allied, et cetera, to send us all their junk removal because they didn't do junk removal. So I told them four biggest trade journals about this and then I spent the next four days pitching to all the big garbage companies. Two weeks later when the four trade journals came out, I was on the COVID of two of them and I was inside the other two. So all four covered me in the story. So all of our partners that we were talking to started flipping through the. There's Cameron, I just talked to him last week. Second, there's Cameron again. Jesus Christ. He's in every excuse My language. He's in every trade journal. They didn't understand that the trade journals weren't coming to find me. I strategically went out to find them. So you could go after a very strategic, targeted approach with pr, with press. And it could be by going after podcasts and YouTube shows and magazines and newspapers that cover your industries or your buyers. And the key is, and I would have your marketing team and your PR team read the book. Free pr. Again, I'm not trying to sell a book, but like, it'll teach you how to actually go out and land this stuff. But if you can go after press, you're going to get more from getting really good strategic press coverage and then being able to share that press coverage everywhere versus just a brand and marketing exercise.

No, I really like that, especially on the, on the conferences because we do have a sales team now of three and they are talking about going to conferences and going to shows and we haven't seen great success doing that in the past when all they're doing is just boots on the ground, you know, pitching, pitching, pitching. I really like that idea of getting into PR while they're there and making that kind of a staple of what they're doing.

Yeah. And you just kind of tie it in with everything else you're building if you want a good web. Yeah, your website does need an overhaul. I didn't think it was this bad. It's pretty dated. Yeah.

It wasn't bad like five years ago.

No, it wasn't bad five years ago. I know a really good company that can do your website for your. Like, if you want an example. I just launched my new. My new personal brand website this week. I do not get a referral fee from these guys. They're just. I just think they're amazing. But I'll just show you the look and feel of what my personal brand feels like. This is my personal brand site. I just think it's super clean. How did this. It's called inflowx. The hardest problem that I had was I have so many different things that I can sell. Right. Like I've got the co alliance and I've got my course and I've got my coaching and I've got group coaching speaking. I've got my books, I've got the op spot that I launched and like I people like, who the hell's this camera guy? I needed them to go there and just kind of go, okay, here's all my stuff. But the look and like the work that they do is really good. They work with some really great brands and their focus is on doing more personal brands. But that approach to a business brand is exactly the same thing, right? They tell the story and they do really fresh, clean work. And I didn't do any of the, I didn't do any of the creative with them. I just gave them the basic layout and they did all the creative. I'll give one kind of quick story and lesson is just absolutely inspect what you expect. I got bit pretty hard on not taking a look at commission reports and having commission reports submitted that were way out of whack. And I didn't realize it. Three years of commission reports and it was substantially out of whack. And it was just because I wasn't sitting looking at it that they were able to slip by on a consistent basis and I had no system to inspect what I expected. I think it's important to make sure that in every area of the business we have that whether it's are we delivering to our customers the way that we want? You know, are our customers being treated the way that they want? Is the onboarding of our people the way that we're expecting it to be? And it's really kind of thinking about that and digging in. One sec car took years ago. We were really struggling with what was happening in our call center. We had about 140 people in our call center and so Brian and I made some ghost calls and we called the call center and listened and we just had terrible responses, did three or four calls. So then we called one of the best airlines in the country, which is kind of the southwest of Canada, called WestJet and we had amazing responses. Three calls in a row with WestJet and we're like, we need to go fix stuff. So we went in and we talked to our quality assurance team. We had four full time people whose job was to listen in on phone calls all day. We said, show us the quality assurance reports you fill out. It had an 86 point checklist of things that they'd listened to on a phone call. It was a four minute phone call and they were listening to 86 things. We weren't picking the phone up on time, we weren't wowing the customer, we weren't asking for the order, we weren't handling objections and we weren't leaving the call with a hug. The five most important things we weren't doing and they're measuring 83 others or sorry, 81 others. So then we went and met with the managers of the 10 different business areas in the call center. We said, how often do you look at the quality assurance reports? They said, we don't really. They're kind of useless. It's impossible to really pull any trends when they're measuring 86 things. What do you do with them? Nothing. We had four full time people who were doing work that nobody was using any to work for. So we literally canceled the 86 point checklist and we kept the four people and we made them listen to five things on every phone call. And within about three weeks, everything changed in the call center. We were wowing customers, our sales went up, our call. So it's about thinking about what do you need happening? And then are you, are you really doing that stuff right? How do you inspect what you expect?

I have a quick question. I'm about to get on a plane, by the way. The question is I'm having a hard time convincing one of my direct reports to fire people. I'm pretty proactive about it, so I think I said a good example, but they don't follow me. And I'm very worried of myself firing him because he's not firing them. So what should I do?

Has he ever fired people before?

Just one in the last 18 months and barely firing the guy left after a conversation.

That's often been my experience is when people are nervous about firing people, it's often because they've never done it before. And when you get to a certain point that you fired people, it gets easier and easier. It's never fun, but it's never enjoyable, but it's easier to do. So sometimes it's just a coaching situation. If they've fired lots of people and they're not doing it, then you really have to sit down and you actually need to show them the data. What I like doing is having all of the members of the leadership team review their teams in front of the rest. And you review them based on results and core values. So on a simple matrix, a four box matrix, you rate them on results from 1 to 10, high results at the top, low results at the bottom, and then core values from 1 to 10 on the core value side and you rate them there on the core value side. Based on those things, you can decide if you should be keeping people, cutting people or changing the seat that they're in. But what you do is you get the head of marketing to review all of their people and present it to the leadership team and the leadership team gets to challenge them. Then you get the head of finance to rate all of his people and everybody challenges them. That's A really good way when somebody is nervous about firing is they have to review everyone on their team and that's a good, a good exercise every three to six months.

Yeah, I kind of do the nine bucks exercise pretty much the same thing, I guess so similar to what you do. But when they evaluate the guy are their employees, their people, they don't necessarily put them on the lower left corner.

That's why everybody else gets to challenge them. Everybody else gets to go, no, no, he's not a seven, right. Comparatively, he's a four and you know, he's a four. But sometimes they need to hear it from their peers, sometimes they won't necessarily hear it from us as leaders, I guess.

What's, what's become, right. I came back to work yesterday right after New Year's and whatnot. In, in our business. And I guess in every business, right, there's peaks and valleys, right. And what's been interesting over the past couple weeks, right, we have the, the buildup that Christmas sales and sales, thank God, finally came in December 22nd, 23rd, 24th, finally. So nerve wracking because you realize that, you know, I was making commitments back in June and July. Inventory was arriving, we're receiving it, we're processing it, we're getting it to stores, we're merchandising, marketing the whole thing. And we're waiting. We're waiting. Finally, thank God the sales came the last three days, right. And it's like. And then comes the, not the letdown, but kind of like the, like all that's over, right?

Yeah.

And then I, I disconnected for a few days with the family and now coming back. So I've spent the day yesterday and today so far just connecting with, with department heads and just, you know, cranking everything back up. Suggestions on getting back to basics. And you know, one of the exercises I went through with my team yesterday was takeaways from last year. A win and a challenge that we had and a goal. Give me a goal that you've got for your department for 24 just to try to get us focused again. Because honestly, for the last 60 days, everybody was so focused on the sales that were going to happen that one week that that's all that, that we were talking about. So anyhow, suggestions on best way to just crank back up.

When does the big push for Valentine's Day start?

Oh, it started yesterday. Started. Started yesterday. So it's not much of a break. But it's, it's not the same as Christmas because when we buy for Christmas, we Have a run through Valentine's. But as far as marketing goes, I, I think we're behind the A bomb. That's one of the things that came up yesterday. I said January 2nd when we were bringing down Christmas decorations, we should have been putting up Valentine's decorations because our competitors are. And it's, it's a race to, to the dollar. If we don't get it from our customer, Walmart's going to get it or Best Buy or car dealership, somebody. So the sooner we get in front of our customers and remind them, hey, you could spend your money here anyhow. That's, that was a takeaway that we're going to do better for. Last year I said 12-25-26, we need to be doing an end of year clearance sale and it needs to be all over our social media and website. And January 2nd needs to be Valentine's Day.

How are you doing with getting people to know about your website and starting to think about buying from your website? That much of that happening yet?

Yes, actually we finally had some sales on our website this December. You and I have talked about it. It's been an ongoing process.

But what I'm curious about is like did every single customer. And it's hard at Christmas, but maybe there's an opportunity now to reach out to everybody who bought from us at Christmas to let them know about our website. Hey, we were so busy during Christmas, we were breaking records. We wanted to let you know about our website if you're shopping for Valentine's.

Or whatever, like the email campaigns and whatnot, where we're adding the, you know, Five Star Jewelers.com Five Star Jewelers.com Five star jewelers.com. but the locals still prefer going and you know, feeling touching and trying on what they're considering. We're really focusing more on the website to reach customers that are outside of our driving area. We, we've made it a point to, you know, pound it in there more in our marketing and communication with all our customers.

Yeah, I think, and I think it's, remember that it's, it's the, the Five Star Jewelers.com doesn't necessarily remind them that they should be coming to look at our website for all the store and the stuff that's on there too. We have to give them a. Because every company has a website. But the fact that you can actually buy jewelry on your website versus just a branding thing, that's different. Right. Or the fact that there's something new that's only ever sold on the website or could you do, by the way, any kind of clearance stuff that's only on your website?

Well, we.

We haven't limited to only our website because it's clearance for a reason.

We want.

We want to dump it. Right. And just this morning I was talking. We're getting ready to go probably, well, May, February. We're going to a trade show in Hong Kong, and we want to free up as much money as possible. So we could go make there. Limiting it to our website would be. I don't know. And we've got six brick and mortar stores that we could be pushing that out.

What commission do you pay to store people?

5%.

So what's the discount you could give for them to shop online?

The clearing stuff. It gets to the point where we're willing to sell it at costs, where, you know. Yeah, once we've identified it to be that toxic, we're.

I think you might have an opportunity. I want to switch gears in a second, but I think you might have an opportunity to do some clearance on the website. Only to force people to go to your website and see the other stuff that's there. It's like, only available on the website. And send, like, three items. You send an email out to your whole list of like, here's five items that are clearance only, only available on our website. Boom. What you're trying to do is get people to go there and see there and go there and shop there.

It's definitely worth a try. It's already on there. It's a matter of adjusting. And only those that would visit the website would actually know that we're selling it.

Well, no, you could be you. Yeah, exactly. The other thing is that. Are you. Are you retargeting? So are using ad roll or Google's retargeting at all?

Yes, I'm sure that the marketing team is.

Do you see my ads following you around the Internet at all? Like for the Second Command podcast or my Second Command book, I only spend about $300 a month. And what's happening? So imagine if everybody coming to your website gets pixeled, and then for about $250 a month total. And the only people that see them are in Miami. Cause you can actually geotarget it all. But the only people that ever see the ads are the people that have been to your website that are from Miami. And you only pay if they click on the ad. But all of those ads they're seeing are like the buses driving by, except it only costs you 250 bucks. The retargeting for you guys from your, from your website could be very powerful for you guys as a branding thing.

This is a long question but I'm going to just start from we are a company, self funded company and what we pay attention to are lowering our cost. So one of the objective this year is cost to GP ratio, meaning we are going to carve out some money from our GP and we are going to invest it for next year. But some of the things that need investment does not necessarily mean they are going to turn into a gross profit which will then delay the investment. How should we think about that? As a growing company at about 40, 50 million revenue and a growth gross profit margin, what should be the priority of the company at this stage?

What should be the priority in the company at this stage? And you're, you're focusing on gross margin?

Yes. At this point you're focusing on gross margin, lowering the cost. But lowering cost means you are not investing on certain things or delaying the investment which then slows down your growth. But if you grow, if you invest a lot, then you won't have that cushion and then you risk the company.

How much have you raised prices in the last two years?

Every year we raise twice a year, beginning of the year and mid year we push as much as we can. I think we might do better on that.

Artoon, there's a really great past speaker, Roland Fraser who did a fantastic presentation on the ratios and numbers in our business and one of them was just if you raise prices by a dollar or if you cut something by 30 cents, the impact on gross margin and net is massive and it's often less than we think it is. But right now we're getting margin compression because of inflation. I mean inflation was not thankfully as bad this year as it was the year prior. This year it was only around 3, they say 3 to 4% total. I think it was like 3.1% in the US. My gut is it was probably more like about 6. Last year it was between 9 and 10%. So you know, 9 to 10% margin is pretty substantial. But if you're not raising prices by 3 to 5%, you're really, really falling behind. I also think it's an opportunity that most people don't go out and grind down their suppliers. It's amazing to me how we often take the price increases but we never push back. And I think there's always. And Mary, I even sent you a note about that a while ago about going back to stripe again and seeing if there's any way that we can even get like another 0.1. Even if they say no, it's always worth asking. But whenever we go back to suppliers and try to negotiate, there's often room there. One of my EAs 20 years ago called FedEx and with one phone call negotiated a 30% discount on all of our FedEx, which was about 300,000 a year. So she was saving us 100 grand. And I said, how long did it take you to make that happen? She goes, one phone call. And I kind of looked at her. And a half hour later she came back to my desk and she goes, I got us to 35. So there's often room when you go out and actually cognizantly decide to look across your supply chain and look across your different suppliers to get some different expenses tightened up, it's often there. Who are you using for payroll product for credit card processing right now or two?

Well, we don't normally get payments through credit cards. We invoice them, they send us the money. We use something like QuickPay. For truckload carriers, what we do is we give them some discount if they pay early. We are trying to get paid earlier than we pay to the carriers.

I would also be careful with giving away the early payment discounts or I would tighten up your early payment discounts. If you currently give 2%, move it to one and a half. If you do one and a half, move it to one. If it's one, move it to 0.8. So when we were building Gerber Auto Collision and Boyd Auto Body, we called all of our suppliers and we said, we're taking our early payment discounts, but we're still paying you at the 90 day mark because we're paying you every month anyway. And they gave it to us. Early payment discounts, I think are one of the worst things that a company can give away.

Even if we get paid earlier than the terms.

I'm not always sure that we get paid earlier than the terms. I think sometimes if we, you know, we had one of our competitors that sent out all the invoices on pink paper and in pink envelopes and they stood out. And because his invoices were on pink paper and pink envelopes, he got paid faster than he used to. There's other ways to get paid faster. Such as? Well, but what is the yearly payment discount that you give today?

About like 5%?

Oh, God, that's so high. Yeah, like maybe you take it down to three. That extra 2% drops straight to the bottom line. I don't Think that anybody that's paying you is going to worry about 5% or 3%. I think they'll still pay you early to take the 3%. They might even pay you early to take the 2%. 5%. 5% is a lot.

Didn't have so much of a question, as much as it's kind of in the same line as what we were talking about earlier around culture and, you know, and that kind of thing and tapping in with your employees. And, you know, we, we have a really strong culture, and I feel like we really try to. To give people the benefit of the doubt and also give people chances that they sometimes wouldn't normally get. Case in point with our controller. I don't believe we knew this when we were interviewing, obviously, but he was an addict that was. Had rehabbed himself and, you know, he was clean, doing well, amazing culture fit. Like this guy's big, big, huge weightlifter, bodybuilder, but he's like a big teddy bear. About a week before Christmas, we got a call one morning saying that he was moving back to his parents because he had relapsed and he needed to get out of town. From that point on, just said, hey, you know, I'm willing to work with you guys, but it's going to be remote. And this is my notice. You guys need to figure out a solution. As of today, we have somebody that is going to replace them. They're starting this afternoon. I guess it really wasn't a question. It's just kind of one of those things that every once in a while when you have that sort of a culture, we do find that that happens sometimes. There's. It doesn't always work out the way that you want it to, and you're kind of left scrambling sometimes. And we're also finding out that there's a lot of things that were slipping through the cracks. And so it kind of opened our eyes to a level of getting more into the weeds of finances that we weren't in previously.

It's a. It's a good. So the reminder is the whole inspect what you expect. And then the second part is that often things like a fractional CFO can be very, very valuable. Right? Somebody who can come in and poke their eyes around finance. If I had a fractional CFO taking a look at my business, they would have spotted the commission reports issue three years ago. If I had actually delegated it to somebody, they probably would have caught it three years ago. But the size that you guys are at, so they were your head of finance. And there were. Were they a controller or director of finance, BP Finance?

What was their controller?

There's a great opportunity for you guys. There's a couple of really good fractional CFO firms. Two of them are partners in the CEO alliance. Happy to introduce you. If you email me. One of them has about 80 or 90 different fractional CFOs and they can actually come in and oversee finance. They can help you rehire your head of finance. They can help you do all the inspections around everything. It's really, really powerful at the size that you're at, where you don't necessarily need the $250,000 a year CFO, but to pay a fractional CFO company five grand a month to come in and actually oversight and help with the onboarding of this new person, help with the recruiting and interviewing of the person, help oversee the systems could be very powerful for you guys.

I think that's what we're thinking. And I'd say the hardest lesson learned was like, it's great to trust, to trust the team, but we have to verify also. You've got to do the trust but verify.

All of those things are real, man. Every time there's a saying like that, trust but verify, it's all, it's all very real and we all make mistakes with it. So there's that whole thing of, you know, to err is human, to repeat it is foolish. Just take, take that lesson now from this guy and don't throw at the baby with the bathwater. I mean, the fact that they were good and you liked them and they were a culture fit and everything was good, don't diminish that. Now that they're gone and you're finding mistakes, own those mistakes as the leadership team and look inward and say, what are the things we can do now to take it to the next level again? Always keep that person as like, they were a good person, they did their best, they were great. We were really happy. Now that they're gone, we're down to a 0 to 10 again. Let's. Let's raise the bar again. It's a really good, healthy mindset for leadership. By the way. Just on that, another good example for leadership. I get super frustrated when a CEO says, oh, so and so quit. I'm so glad they're gone. Well, you hired them, you know. What did you miss in the interview process? What did you miss in the onboarding process? What did you miss in the training process? What did you miss in the inspection process? What did you miss in not having the right metrics in place like what are the things that you missed that allowed that to happen or why did it what what did you miss that allowed it to go on for so long? But don't blame the person when they're going out the door, right? Whether they're, they're quitting or getting fired. It's a good, good opportunity to self examine. All right, everybody, let's wrap there. I think let's go back to what we started off with and just love bombing everybody. I think there's a huge opportunity for us as entrepreneurs, CEOs, CEOs to really love bomb the people that work with us because the more that we can contribute by saying thank you, showing gratitude, having praise, the more that we can then withdraw with giving them more projects and more goals and stuff later. But it's also just the right thing to do. So I we got a good opportunity to love bomb everybody this week.