S4:E6 Never Lose a Customer Again with Joey Coleman

In every business, in every organization, in every aspect of our life, there is an opportunity to say, is there a system I could learn and follow that would get me even better results than I'm getting today?

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Most businesses and business owners, I think they spend more time chasing the next lead, the next sale, the next win. And I get it. I've done the same, but I think for established businesses, the biggest opportunity, it's not out there. It's kind of like inside the business. It's with customers that you've already worked so hard to win over, but they end up just quietly drifting away. I think that cost to acquire a new customer is definitely far higher than just keeping a new one. I know this, I teach this, yet I'm still guilty of taking my eye off the ball and not putting enough attention on it. So today I wanted to talk with one of the world's leading experts on customer retention, Joey Coleman. He is the author of the Wall Street bestselling Never Lose a Customer Again, and he spent nearly two decades helping businesses and business owners turn their customers into lifelong raving fans. And it all has to do with focusing on what happens after the sale. So if you're serious about building a business that lasts, you're going to absolutely love this episode. And first things first, thank you so much, Joey, for making some time.

David, it's my pleasure. Thanks so much for having me on the show, and thanks to everybody who's joining in. I've really been looking forward to our conversation.

Oh, my first question actually is one that I feel like I already know the answer to, but I'd love to hear how you think about it. If you see yourself as a systems person and someone who approaches the world with systems thinking.

I love it. I didn't used to, to be honest. I used to, if it's okay to give full confessions early on in the show, I used to actually think that systems people were boring. These were the kind of people that were like, oh, you don't want to invite a systems person to the party. They're gonna, yeah, everything will be lined up and built out, but they won't be fun. They, they don't know how to dance. They're— this isn't going to be exciting. But as time went on and I was an entrepreneur for longer and I started to work with more businesses across more industries, I actually realized that the more systems you have, the more freedom you have. The more you know that the things that have to be done are getting done, the more nimble you can be to respond to a situation that might need to go outside the system, or the more responsive or reactive you can be to what's going on with a customer or with a team member. And so now I really work to become more of a systems person every single day. And I would say one of my favorite recent quotes about systems was related to something that my younger brother told me. I'm one of 7 kids. And my younger brother, I was at his house, and he was packing some things up and putting them in his car. And he was taking a long time winding this cord of this tool that he had just used. And I'm thinking, "Let's go! I want to get out of here!" We've been in the garage for a while. And he just said to himself, he didn't even know I was listening. He said, "Future Chris will be so proud of me." That's the best. Oh, that's powerful. So I immediately told my wife, and now that's become a phrase in our house. We even say future Chris, even though my name's Joey, my brother's name is Chris. Whenever we're doing something that is about a system or about a process or about thinking down the road, we say, "Oh, future Chris will be so proud of us." that we took the time to follow this system. So while I would never consider being so brazen as to call myself a systems person when on the call with the systems expert like you, David, I aspire to be more of a systems person with each day.

Yeah, I absolutely love that. Do you reckon there's a rise in attention on the topic of systems and process in small business land? I feel like it's hard for me to know because I'm in the thick of it, but I just feel like it's more and more common that, oh yes, you need a system and a process for that. I don't— I'm curious to know if you see that in the circles you move in.

I would say that's certainly been my experience, that it seems to be a topic that is getting more conversation, more attention, more focus than maybe it has in the past. I think there are two reasons for that. I think there's a reason we can be excited about and a reason we can be anxious about. The reason we should be excited about that is I think more people are becoming aware of your work, of the power of systems, of systems thinking, And so just by the nature of more people becoming exposed to the benefits of systems, there are people that are being drawn to the power of having a great system and having that implemented and having processes detailed in your business. Sadly, I think the majority of people are coming to systems, though, from a place of overwhelm, not from a place of potential. They feel that there are so many things going on in their business, so many things they're trying to keep track of, that doing— writing it on the back of a note card or an envelope isn't enough anymore. So they're buying the software that helps them organize and create SOPs. They're building out checklists that allow their team to follow. Now, to be clear, I think all of these are good things, but I think most people are coming to it from a place of fear of something falling through the cracks rather than from excitement about what a well-built, well-orchestrated system will allow them to achieve.

I reckon that speaks to right how I feel about systems because I don't actually love writing out checklists or processes, which I know that's almost like the dirty little secret of Systemology here, but it's what I've fallen in love with is the result that they bring. And it's also me knowing that it's not my natural tendency as a business owner, therefore I should surround myself with people who it is their natural tendency because I know how powerful it can be in business. That's, I need someone to make up for where I'm not as strong.

David, I love that, and I think that speaks to the entrepreneurial experience broadly across the continents. I think so many people are drawn to becoming entrepreneurs because they don't like following the rules. They want to do something different than the marketplace has done before them. They want to create a competitor to an existing business that just isn't doing it the right way, or their definition of the way. And I think so as a result, they are naturally drawn and overly indexing on break the rules, do it different, do it in the unexpected way. The problem is that's not scalable. And that's not sustainable. That certainly allows you to pivot and respond to situations quickly, but it doesn't allow for any uniform results or consistent results. I often think, and I'd be curious as if you spend as much time thinking about this as I do, I often think about the systems that exist in an emergency room. So an emergency room, if you think of the medical profession, this is the most chaotic place in the entire hospital. You never know what's gonna walk through the door. You never know whether it's gonna be a life or death situation. Sometimes the decisions you're making turn on the second and being able to reach and grab the right tool or have access to the right medicines or the right monitor or the right device at a moment's notice. The best ERs in the world function being built on a stack of systems and processes. Everything's in the same place at the same time. They know they're restocked, they're ready to go, they're constantly ready for the chaos to be leveled out into a manageable scenario based on the systems. And my theory is, if it's good enough for an emergency room I think that matches any entrepreneur who tells me, oh, Joey, my business is— it's too different. There's no way we could build systems. Every client's an exception. Every scenario is different. We never do the same thing twice. Great. What else do you lie about? Because I think the reality is you do. You just have told yourself a story that there isn't a common thread or a uniform approach underneath this that we can build a system or a process around.

Yeah, I love that metaphor of thinking about hospitals and emergency rooms because I think like one of the most important systems in that scenario is the triage system. The chaos comes in, how do we determine what needs our attention? We have limited bandwidth and resources that we can allocate, so where is that going to go? If we follow that same line of thinking and we apply that to small business, and we were thinking about triaging that situation. I'd be curious to know, how would you help a small business owner identify where it is? Because I almost feel like this whole idea of keeping customers, like, it's— you might have gone through and identified that really, that's one of the most important things in business.

And I would posit it's probably the most important thing. And the reason I say that is it is so much easier to keep an existing customer than to go find a new one. And you don't have to take my, my opinion on this. The research on this is very strong. When I was writing Never Lose a Customer Again, we looked at businesses small, medium, and large, online and offline, across all industries. Businesses that sold product, those that sold service, those that sold product and service, those that operated nationally, those that operated internationally. And what we found is in the research looking at all of those organizations, your likelihood of converting on a new prospect, on a cold prospect coming into your business across all industries, averages out at about 20%. So across all industries globally, about 20% of your prospects will eventually work their way into becoming customers. Now, if your number's higher than that, good for you. If it's lower than that, sorry, you're part of the group that makes the average possible. But the moral of the story here is when we look at doing business with an existing customer, your likelihood of converting that sale goes to 60 to 70% depending on your industry. So it's 3 times or more greater than your likelihood of getting the result you're desiring out of a new customer. And yet If I were to go to the typical small business owner and say to them, what's your strategy this year for getting new customers? They'll tell me all about, oh, we've got this marketing campaign and this ad campaign, and we're going to start doing this type of promotion, and we've got this offer coming up, and we've got plans all the way through the year of all these different things we're going to do. Fantastic. Then I ask them, what's your plan for keeping your existing customers? 'Oh, we're going to do what we've always done, treat them well.' Really? That's your big magical plan? You can tell me down to the penny what your marketing budget is for the year to come for getting new customers. You can't— most organizations can't tell me how much money they've allocated towards keeping existing customers. I find this to be a fundamental flaw in the way most organizations are operated.

Mm, I think one industry, because we do a little bit in the SaaS space, I almost feel like that's one of the only industries, at least in the— once they start to get some funding, where they've really figured this out. They know the lifetime value and they want to make sure that that time from sign up to getting value is the shortest possible. And they have account managers that are checking in because they, they understand that The aim of the game is acquiring and keeping customers and then going, what else can we sell them and upsell and cross-sell them and serve them better?

David, you're so right. I think a couple of things— there were a couple of elements that combined to create that over-indexing on awareness within the SaaS space. Number one, one of the unique things about software as a service is, as a general rule, I'm able to monitor in real time all of my customers' interactions with the product they bought from me. If I have a SaaS company and you're one of my customers, I can see when you log on, I can see what you're clicking through, I can see how much time you're spending. I can run a report that says, when was the last time David was on? And if it's been a week, I can ping you and say, hey, we haven't seen you in a while, brother, what's going on? So there was a unique technological capability that a lot of other product and service businesses didn't have. Number 2, the ability to scale within a SaaS business is really only limited by the number of inputs. Once you build the software, once you build the offering, you can usually pipe as many people into it without having the same challenges you do around resources and building out that you would in a traditional product-based business. And number 3, the venture capitalist who came into the SaaS place— space realized very early on that the magic was in reducing churn. Because when you're paying every month for a service, if I can keep you one more month, that month is more profitable than the first month. So every month you are in a SaaS subscription type service, each subsequent month is more profitable than the first because you've got a wider base, you've covered your marketing costs, you've covered your your service costs. Once somebody gets more familiar with your software, they have less questions of your support team. It starts to become part of their business. It becomes stickier. They don't want to lose it because they've built a business on top of your software. And so that confluence of those three things, I think, made that industry uniquely predisposed to pay attention to lifetime value of a customer and to draw the financial value of that into the valuation at an investment level or a purchase level or a payout level.

I definitely feel like there's a lot for business owners that may not have a SaaS, a lot that they can still learn from the SaaS industry thinking about how they approach this. One thing I like about your work is it's almost like we talked about triage before. And we talked about, okay, focusing on this retention. I almost feel like you then, you triage the triage because if we know that keeping the customer is so important and then it's okay, then what's the most important part of keeping a customer? And this is where you really focus on this 100 days idea. I'd love to explore a little bit more because that's like the essence of where you're doing most of your work. I'd love to know how you got to that idea and then we can explore it a bit more.

Absolutely. So the idea comes from the research. I'm a recovering attorney, right? The first step's admitting you have a problem. There's 11 steps after that. Basically, my experience as a lawyer made me always curious as to what does the evidence show? What does the research show? If we're gonna have an assumption, if we're gonna have a hypothesis, what evidence already exists to help us prove that or disprove that accordingly? And when I started doing the research, I realized that customers quit, and quit faster than most businesses think. I was reading a report from the banking industry one day, and it said that 32% of bank customers quit their brand new bank before the 1-year anniversary, and half of those quit in the first 100 days. I don't know about you, David, but I know a couple of bankers. Talk about people that are not folks who necessarily you want to invite to the party. If they bring their checkbook, you can invite them to the party. But otherwise, what I think is interesting about bankers is they pay pay attention to the pennies. They pay attention to where the numbers— they're numbers-oriented people. And if that industry was losing 16% of new customers before the 100-day anniversary, when— I don't know if you've opened a bank account recently, David. I know in the United States it's a pain. You've got to come into the bank in person. You've got to bring multiple forms of ID. You've got to bring paperwork. You've got to bring all these things. You have to set up the account. You have to wait to get your ATM card, your checks, your PIN numbers, get all the accounts set up for direct deposit, for direct payments, ETFs, ACH, all these various things. It's not fun. And even after going through all of that, 16% of customers were leaving before they'd been there 3 months. This left me curious too. If this is how bad it was in banking, what about the other industries? So I started researching. Software as a business, software as a service, on average 20%. Cell phone companies, 22%. Restaurants, 40 to 70%, depending on the cuisine you served. Auto mechanics, 68%. These numbers were staggering. On average, 20 to 70% of new customers quit before the 100-day anniversary. What was scarier to me than that, David, was that the typical business owner had no idea what their percentage was. In fact, for everybody listening in right now, how many of your customers quit in the first 100 days? If you don't know that percentage, you're not tracking your customer onboarding at the level you need to. Now, some people are also listening going, Joey, you don't understand the type of business I'm in. My customers can't get all the paperwork completed in 100 days. They're still— we're still onboarding. Okay, fine. But the research also shows that in that first 100 days they are making the decision about how long they will stay with you. Some companies that have a year-long program where you renew every year, everybody thinks, oh, they're making the decision in month 10 or in month 11 whether or not they're going to renew. Nope, folks, they make that decision in month 1, 2, and 3. They make that decision at the beginning of the relationship. Last piece on the research, and then I'll stop talking research. You can tell I get excited about it. On day 101, if your customer is absolutely loving the relationship they have with you, they feel well taken care of, they feel seen, they feel heard, they feel valued. In the typical business, that customer will stay for a minimum of 5 years. 5 years. If you get the first 100 days, that seems a worthwhile focus to me.

I love this. I think that's a big part of what we think about with the critical client flow in the book. It's almost like it's my way of thinking about triage for small business by looking at the flow that the prospect and the client goes through to deliver that core product or service. And then we ask the business, where in that is the pain and where are you dropping the ball? Quite often it is that onboarding and the handover from sales to operations and getting people in. In your book, you go through these 8 phases, and you touch on needing to make sure that you address each of the phase. I'd love to go the step beyond that, and then, because I'm always quite tactical and trying to get down to what's the system that sits behind it, like, I'm imagining the outcome of all of this work that you help businesses do is to generate their own system for onboarding a client that addresses each of the 8 phases that then can be passed to a team member and then scaled. Is that— yeah, how you imagine, like, what is the end product of doing this work that means they can then execute on these ideas?

Yeah, I think there's a couple pieces of it. Number one, you need to know where in the journey your customer is. Where are they in the 8 phases? Some can go through the first 3 or 4 phases in a matter of days. In some businesses, you might not be to phase 4 until a year from now. So every business needs to map their customer journey to these natural human evolutionary states of the 8 phases of relationship building. So you want to pay attention to where they're at. Number 2, once we have a common nomenclature or a system or a process within our business, then we can have conversations about where a customer is on the journey. And what it's going to take to get them to the next step or the next phase in the journey. So what we do is it gives us language within the organization to, number one, understand where everybody is, and number two, understand what needs to happen next. Third, when we do that, when we take care of them, the customer feels provided for and cared for. I don't know about you, David, but there's been plenty of times where I've purchased a new product or signed up for a service. And prior to signing up, the salesperson, whoever was trying to convince me to do it, was ready at a moment's notice to answer any questions I had. Help me, show me all the great things this was going to lead to. But the second I said, okay, here's my money, I'm signing up, it was like cue the tumbleweed. Suddenly they weren't as responsive. They weren't available. Oh, we have FAQs, we have a training manual, go read that. No, I don't want to go read another book to help me understand this thing I just purchased. I want you to teach me. I want you to I want you to show me. I want you to help me. So when we have built into our organization systems and processes that hold our customers' hand as they navigate through these phases, they feel incredibly well taken care of. And a well-taken-care-of customer doesn't leave. A neglected customer leaves. So this speaks to The ability to understand where your customers are, the ability to get your team working in alignment for the same goals, and an ability for your customers to feel valued and appreciated, all of which combine to create a wonderful impact on your bottom line. More profit, more revenue, more opportunity, longer lifetime value, and frankly, more sustainability that you can then build on and grow your business and take your business in whatever direction it serves you.

Often the way that we approach this from a systemization perspective, I'd love your idea, is we go, let's say you're working with a business, we go, let's capture what you're currently first doing. Because especially small business, they don't even do things, make it repeatable. Every client— yeah, yeah, it's just different, it's bespoke, or depends who's doing it will determine the result. So we go, let's capture what we're currently doing And we talk a little bit later in the process— for us it's 8, sorry, step 7— where we start to do the optimize. How do you think about optimizing and really starting to improve this onboarding experience? Is this sit down and we design the first 100 days, or again, do we triage within that and then say, where are things breaking down the most? How do you approach that?

Yeah, similar to you, David. The first thing I like to do is get a consensus, an agreement about what's happening right now. Before we come with a new idea or a new suggestion, let's audit the existing process. As I'm sure you find out with your clients, often that alone produces double-digit opportunities, right? Oh, not everyone gets a welcome call. Some people do. If you get Sally, it's great. If you get Frank, you're in trouble. It becomes so abundantly clear just doing the audit. Lots of times when I go in and consult with companies, one of the first things we do is we pick somebody from the organization who thinks they understand how the system works. We put them in a chair in the middle of the room, and I go up and I map out the entire customer journey from the time that someone first learns of a product or a service or a company to the point where they're a raving fan making referrals actively. And we map out every step in— I've done this exercise on all 7 continents with businesses in dozens and dozens of industries, David. I have never found a single person at any organization, even solo entrepreneurs, that can detail all the steps that are happening in their existing business. So lots of times just that awareness opens up huge possibilities. Then when we see what the journey currently looks like, It's painfully obvious where the opportunities for improvement are. Oh, this person's been a customer for 3 months and we haven't checked in once to see if they're liking it. Should we maybe check in once? I don't know, what do you guys think? And next thing we implement a check-in call and we find out that increases retention, that increases happiness. First we map, then we see what's obvious, and then and only then do we suggest new things to start doing. There are a lot of consultants out there that come in and say, oh, here's the 5 things you should be doing. And you're like, do you even want to know what we're doing right now? No, just do these 5 things. You'll be great. That's fine for other consultants. That's just not how I want to operate. I like to know what's happening right now, see what emerges from that assessment and that auditing, and then figure out how we can make it better in the future. And then to your point about optimizing, I believe that this job is never done. Now hang on a second. A lot of people just got really frustrated. A lot of people are like, Joey, I thought once I figured out the 8 phases and I built my system, I'm good. We are for a while, and it depends on your industry how long a while is. But I will tell you, in my own business, we reassess the 8 phases every year. Every year we look at the journey and say, what worked about the journey last year? What didn't work about the journey? How can we make the journey better next year? And we make those assessments, we make those considerations so that we can constantly be improving the way we're interacting with our customers.

When you're making those decisions, are there any particular metrics that you're really focusing in on that help you determine this is winning for us, this is succeeding or not? Is it just the bottom line? What are you looking at?

I think it depends on the business, right? It depends on what your business model is. Let's talk about— I'm happy to use my own business as an example because I have different aspects of my business. So I have the aspect of my business around writing books, I have the aspect of my business around giving speeches, and I have the aspect of my business around doing consulting engagements. When I'm writing books, once you buy one copy of my book, chances are pretty good you're not going to buy another copy. You might, and that'll be great, and I'm happy if you want to buy a second copy, folks, go ahead. But most people are going to buy one copy of a book. So what is the behavior I want to have happen happening. Number one, I want to know, did they read the book? That's interesting. How will we know if somebody bought a book that I don't even know who they are because they bought it at a bookstore or Amazon or wherever they got the book? We have things in the book that are built in to help me understand who's actually reading it and how much of the book we're reading. Secondarily, did they write a review? So in the books, one of the KPIs I'm checking is sales to reviews How many sales were made this year? How many reviews were written this year? That helps me understand if it's working and gives me an idea for future books, how I might improve them to increase those metrics. Let's look at speaking. When I come off on stage, how many people come up and say, "I want to book you for our next event"? So how many speeches are leading to new opportunities? And And how many of my existing clients are booking me to come back for more? Both of those are metrics that are very unique to my business, but ones I pay attention to. And then on the consulting side, great. How willing are you to continue to invest in our work? So every time I do a consulting project, we clearly outline, here's the problem we're trying to solve. We're going to spend 3 months, 6 months, a year, whatever it may be, trying to solve this problem. Once we solve that problem, have we created the kind of experience that you say, what problem should we focus on next? If so, I've done my job. It may be the case that somebody isn't willing to continue to work together because maybe they don't feel they have other problems, or they've— we've grown their business so much that they're like, we just got to focus on the good things that are happening now. We don't have time to— we can't convert at any higher rate, Joey. We don't have enough people to handle the conversions we're getting. Great. Have I positioned myself for them to write a testimonial or be a referral? Those are some of the metrics I look at in my business. Now, where this applies to every business: what is repeat business? What is testimony-worthy behavior? And what is the frequency of referrals? Those are 3 things that I would be looking at in any business to say, how are we doing? I've got lots of clients that will tell me, Joey, my entire business is based on referrals. I'll say, great, how much of your business do you get from referrals, like 12%. Okay, actually, your entire business isn't based on referrals. 12% of your business is based on referrals. So either we're not tracking the referrals right, or you have a story that doesn't match the reality of the numbers. I have yet to meet an organization, David, that has said to me, Joey, I'm all good with referrals, we don't want any more, we're all set. So that's often a metric and an area that we can get improvement in very quickly and in a meaningful way that impacts the bottom line.

I feel oftentimes that I very rarely see that systematized, yet it's so key. Like, we all know a referral is so much easier to sell. They're usually better clients. Birds of a feather flock together. So usually some of your best clients, if you train them right, are going to be your best referrals— referrers. But oftentimes it's not built into that system, let alone the first 100 days. And I'm imagining that would be the time to build it in. Like, you get someone on board, you get them a good result.

Yeah. And so again, I think it depends on the business. In my experience, the reason why referrals don't happen falls into usually one of two categories. Either you're asking for the referral too early Hey David, would you like to come to my restaurant? Yeah, great. Oh, here, before you place your order, who else would you like to text right now to tell them that they should book an order at my restaurant? And you're like, I haven't even eaten yet. I'm not gonna tell my friends they should come here. I don't even know if the food's good. Most businesses ask too early or never ask at all. They don't have a system and a process for asking referrals, which means Most humans don't like asking for referrals, so that means their teams aren't actually doing the asking. The secret, in my opinion, to when to ask for a referral is you want to ask after the customer has achieved the goal they had when they originally decided that they wanted to become a customer. So if I join a gym and my goal is to lose weight, and I say my goal is to lose 20 pounds, Great, or 15 kilos, whatever it may be. Fantastic. Are you tracking my progress towards that? And when I hit that, are you then asking for the referral? Don't ask for the referral before I've started to see any results, because I'm not going to put my reputation, my social capital on the line to say, oh, I should have all my friends come to this gym if I don't even know if the gym's going to work for me. How do I think it's going to work for them? Them. So I think the secret is when you do that mapping of your journey to say, when are they going to actually start to experience meaningful, substantive results? And that's when we insert the systematized referral ask that increases the likelihood not only that it gets done, but that customer actually makes a referral.

I love the— when we get down to it, what you've just said there really it's about making sure that the business delivers the result that they've promised in their marketing and in their sales, and that's the reason the person bought. So the first 100 days is really about making sure we actually get them the result that they signed up for, which is what they paid for, which is going to make them happy, which is going to make them come back, which is going to make them refer. So it's— I think a lot of people people, yeah, they make big bold promises in their marketing and sales, and then their ops team failed to deliver, and then the client's going to get frustrated, and that's why they're churning, that's why they're not referring.

David Jenyns, now some people who are joining our conversation might be thinking, but Joey, you don't understand, in my business we can't achieve the goal in 100 days, it's impossible. Let's say you hire me to do your taxes, I'm an accountant and I'm gonna do your taxes once a year when you have to file with the Revenue Service. And let's say you hire me in the middle of the year, and so it's gonna be more than 3 months before you actually see the results. Every business has to educate their customers on where the milestones in the journey are. And in an accountant example, maybe the milestone is we have accurate financials, we have accurate tracking of your spending, your invoices are being properly recorded as going out and being paid. When those systems are happening, you're creating the things we'll need to file for your taxes, but we're doing it over time. So even though the end result is still a bit away, we're making progress as we go, and there might be an opportunity to ask for a referral along the way to celebrate when they've done it. The other thing, it might be that the referral shouldn't be asked for until after the first year they file taxes. Some people may say, Joey, that's outside the 100 days. You're right, in your business it is, and that's okay. But when we get past that accomplishment, are you ready to ask then? Have you positioned yourself well to make that ask and have your customer be excited to make a referral.

My brain starts to piece together again. I just get down to that real tactical what happens when. If we go high level, and really the sign of a great system is one that can be applied in most scenarios and get a pretty good result, but that's just where you start, and then you optimize based on the situation and that data. But if we start at high level, if you think about that first 100 days and the key touchpoints, you mentioned about like an onboarding call, and I'm imagining now we've got to explain the milestones. That's, that's probably going to have to be something upfront because you want to make sure that expectations are aligned. A lot of businesses get in trouble because the expectation between what the client thinks they're getting and what the business thinks is out of alignment. And then there's other points in this journey, like after the results where we're talking about that, that's a great time to be thinking about referral. What— when we think about that linear journey, and I suppose this maybe moves beyond the 8 phases or comes down to more what is the action step in the 8 phases, if we were to generalize the first 100 days, I would say in each phase the emotion that the customer wants to feel is different.

And in each of those 8 phases, you need to meet them with interactions, touchpoints, deliverables that help them to achieve their desired emotion. So let's look at the Assess phase, the first of the 8 phases. In the Assess phase, a prospect is assessing whether or not they want to do business with you. What emotions are they looking for? They're looking for confidence that you've done this before. They're looking for some level of certainty that you're going to be able to do it again. They're looking for honesty about how it's going to work or maybe not work. And they're wanting to have some feeling of credibility that they can trust you to do this. And that usually means they want to see testimonials. They want to see other people singing your praises, not just you singing your praises. Great. Those are the emotions we need to hit. What are we doing to make sure those emotions happen? Then we come to the next phase, the admit phase. In the admit phase, a prospect admits that they have a need or a want that they think your business can help them with. They sign on the dotted line, they hand over their hard-earned money, they transition from being a prospect to being a customer. What are the emotions they want to feel in the admit phase? They want to feel certainty that they made the right choice. They want to feel excitement about what's going— they want to feel that you're as excited about this as they are. They want to feel hope and possibility that the salesperson wasn't just feeding them a line, that they're actually going to get the results they were promised. Great. So what are the touchpoints we need to make during there to help them feel those things? And each of the phases has feelings that the customer is desiring that they're probably never going to tell you, David. It's highly unlikely a customer is going to say, I just signed up for your program. I need to feel confident in the choice I just We know that's what they want because they are human like we are, but they're never going to articulate that's what they want. That's a challenge a lot of businesses have. They're like, Joey, I survey my customers, I ask them, what would you like different? And they never answer. So therefore they must be happy with everything that's going on. Not at all, friend. You get asked all the time by your significant other, by someone you're in love with, Hey, what, what do you really want? Oh, wait a second. Is this a trick question? I'm not sure I wanna answer this honestly. I wanna tell you what I really want, but I'm not sure that I should, because if I don't do it exactly the right way, there might be a negative consequence that I don't wanna experience. Or the last time somebody asked me what I really want and I told them, I was embarrassed for it. I was shamed for it. I was ridiculed for it. I was told I couldn't have it, whatever it may be. Are the same the world over. We have emotions that we want to feel, and we're often unsure about how to ask for what we want and what we need. So you've got to create an environment where your customer feels comfortable doing something that they might not do in any other area of their life, which is give you honest feedback and tell you what they really want.

There's systems you can create to do I, I love this, and I'm imagining you could really go quite deeply. I think the person listening to this needs to determine and think about what it is that they're selling, at what price point, to then determine, is this something that you have an account manager that's sitting on and thinking about and knows these stages and moving the person and through, or have you got a lower price product that couldn't necessarily afford that? And then now do we think in terms of these are the stages that will generalize and build into a system so things are sent out to address each of these different stages? And, and then we're about to be in the world of this AI-powered world where we can start to do some of these things at scale that previously could have never been done without having an account manager. So how are you seeing this change with AI and what we're seeing on the horizon? Because I feel like you're going to be right on the bleeding edge of this stuff.

Yeah, I appreciate that. I think a couple of things. I have some very strong opinions about AI. I think AI has a lot of potential and possibility. I also think that presently the benefits of AI are being oversold, right? Most businesses— I'm sorry, I say this from a place of love and respect, and if you disagree with me or have examples that counter this, please reach out because I want counterexamples. But most of the businesses that I've seen roll out AI are told, we're going to spend a lot of money to get this really unbelievable technology that's going to help us to run this systems-lacking business we already have. Better. No, it's not. It's just not. It's gonna augment the problems you already have, not solve new things. I was working with a company. This company will do about a half a billion dollars in revenue this year. This is a big company, and they have the ability to bring to bear the resources to implement AI. I was in a meeting with their senior executives a few weeks ago. We're talking about this initiative, and they're like, we're gonna roll this out, and then we're gonna have this, and we've got this technology Partner, blah blah blah. And all of these programs are going to pull the notes that our salespeople, our account managers, that everybody has put in about the client. So you're going to be able to, before you get on a call with a client, say, what do I need to ask this client about based on the interactions we've had with them in the next 30 days? And it's gonna pop up a list of 3 to 5 questions that you should ask them about that are intelligent and based on the data we I said, gosh, that sounds amazing. I said, remind me, who in the room here is the person who's responsible for all the technology? This little guy in the back who hasn't been speaking at all raises his hand. I said, great. On the typical client, how many completed and filled-in notes fields do we have? David, you would have thought that elephant walked into the room with a monkey on its back playing a drum. He quickly looked down and he looked back up at me and he goes, it's actually going to be a problem. And I watched the CEO go, wait, what? He said, yeah, it's going to be a problem. We don't have enough notes to make this really that valuable. Our people need to be taking the notes when they're on the phone call, when they're in the conversation, when they're having the sales meeting, so that we have the note, the data to pull from. Wrong. Now we're having an entirely different conversation that is not about technology, but it's about human behavior. It's about how do we get people to do the jobs they're supposed to do. Now, that's a whole separate podcast, David, but the moral of the story here is, do I think AI is going to make changes? Absolutely. Do I think they're going to happen as quickly as everybody's promising? Absolutely not. Do I think in a world where everybody is saying the answer is digital digital. There is going to be more power in analog, physical human interactions. Absolutely. So I think AI has possibilities, but don't stop paying attention to your humans thinking that your AI is going to solve it.

You also mentioned something right at the start of that which speaks right to my love language of systems, because you also said your businesses lacking systems. Like, how are you expecting AI to do anything? Because the systems and the process, that is the programming for the machines, that tells the machines what to do. I absolutely love that idea of the AI really is only going to magnify your chaos. It'll— it's a magnification tool.

So exactly, in that regard, AI is like money. Yeah, money Money magnifies the type of human or the type of organization you already were. If you were— it's the people who walk around thinking, oh, when I have more money, I'll be generous. No, you won't. You'll be exactly the way you are today. You'll just have a bigger check. People think, oh, when my business hits these revenue goals, then we'll have systems. No, you won't, because you didn't push— place any value on systems while you were coming up. How are you going to suddenly decide that's where you want to invest your time and money, in creating systems. AI and money are magnifiers of the underlying object, business, person that is being magnified.

It's great being able to talk and get into the way that you think, because I can start to see now through your model of the world. I can think about your next book around the Never Lose an Employee Again, which it's that same same thinking only applied to another triage point in the business, which is Brad Smart and Top Grading has been talking about, like, way back when, that whole idea of the cost to have a mishire and to lose someone. And like, you want to make sure that you're thinking about it. So you're all about, like, the lowest hanging fruit generally in a business is to work with what you've already got rather than going outside. First maximize everything and then look for scale and make sure that the insides are right. Otherwise it's just going to multiply that chaos.

Absolutely. My first book was all about your external customers. My second book was all about your internal customers, your employees. And here's the thing I often get asked, David Jenyns, Joey, which is more important, customers or employees? It's a little bit like the chicken or the egg question. Which came first, the chicken or the egg? But I actually, if forced, do have an opinion on this. I think the most important focus needs to be on your employees. And the reason for that is you can always find a new customer. It is easier to find a new customer than to find a new employee. And if you doubt the validity of that statement, I just ask you to think about the last time you had to hire someone. How many resumes you looked through, how many interviews you conducted, how many background checks you went through, how long it took them to get up to speed, how How long it was before you felt you could trust them. Look at all of that compared to if I told you had to go out and get a customer before the end of this week, chances are pretty good you could go do that and it would be a customer that would at least produce net positive revenue for your business. The same cannot be said about employees, which is why these systems and paying attention to these phases, by the way, same 8, 5, 8 phases that apply to external customers apply to your employees, your internal customers as well. It's the exact same 8 phases. The same desires that people are trying to have. It's just about mapping it out, creating a system, and making sure you deliver on it. And if we think systems for onboarding new customers are bad, oh brother, you should— would be shocked at the lack of systems for onboarding new employees. The typical employee— the research shows that 58% of companies, 58% of companies spend less than 1 week training a new hire. Let me ask, do we want them to stay longer than a week? Do we really think we're going to be able to tell them everything they need to know to be a successful employee in year 4 if we're done training them and teaching them in week 1?

Not at all.

What are we doing to make sure we continue to invest in our people, that we have the systems, the process to get them up to speed, to help them succeed, to help them learn? Learn. That's how you build and grow a business. You build a growing business with people, right? Whether those are employees or customers. And how do those people successfully get built and grown? Systems.

I think I need to have a bloody series with you because, yeah, that's the next podcast episode. Maybe as a kind of closing point, I'd love to know how you would justify the cost of developing small, like, systems in small business. Like, people often say, what's the ROI here?

What—

again, I find that a challenging question to answer because it touches every part of the business. And like, a lot of business owners as well, they see it as more of an expense rather than an investment, and they'd rather put some extra money into running paid ads than it would be identifying their systems champion and say, all right, let's document some of our processes and then use it to train our staff to get better results. I'd love, yeah, to hear how you would answer that.

Yeah, so when people come to me and they say, but Joey, what is the ROI of caring about our customers? What is the ROI of paying attention to this? Yes. I say, great, so we're going to have an ROI conversation. And they're like, yeah, I want to have an ROI conversation. I say, fantastic, I want to look at every aspect of the business and the ROI. What's the ROI of marketing? How are we tracking the spend? How are we tracking the conversion? How are we tracking the results? Until we were doing online advertising, that didn't exist. That is new in the last 20 years. When people used to run ads on TV or in the newspaper, there's a famous ad man that was remarkably infamous for this phrase, 50% of my money I spend on ads works. I just don't know which 50%, right? So let's look at that. Let's look at the ROI on your technology. You bought everybody a new computer. What was the ROI on that? Well, the computers are faster. Great. How did you track the ROI? People were more productive. Thanks for that blanket, blazing statement. I'm asking for specifics. You want me to give specifics? You have to give specifics on the other areas of the business first. What I find, David, is most people quickly don't want to have an ROI conversation, right? Because they're applying it as an excuse to not do something. They're applying it to continue bad behavior. They're applying it to say, I don't understand that thing you're talking about. I don't feel naturally hardwired to be a systems person. Therefore, I'm going to say, what's the ROI? On this systems methodology, not because I actually want to know the ROI. It's a way for me to create a false rejection of the premise that we should do it and to hopefully get out of having to explain why I really don't want to do it. So that's usually how I answer ROI questions.

Yeah, and you're right, it's almost like a little defense mechanism to try and get out of jail free. Because when you keep going down to it, at the crux of it, all great businesses are built on great process. All process is, uh, documented best practice habits. Like, the— this is how we do things. And especially in the world of small business I do a lot of work with, it's— you can't really hold someone or your team to an account unless you— to account unless you can define, this is what I want you to do. If you told them. Otherwise they'll just use the basic excuse of, yeah, but I didn't know that's what you wanted. And that's their get-out-of-jail-free card.

Exactly. And this is the thing that blows my mind about so many leaders. So many leaders are beyond frustrated with the performance of their teams. I was on the phone earlier today with a CEO that was lamenting his team's performance, and I said, great, Great. Will you call up their quarterly expectations document? He's like, what? I said, the document where you've met with them and told them, these are my expectations for what you performing at a high level is. Here's your stretch goals. Here's the base level that I need. Where is that document? They should know, Joey. How should they know? Did they grow up in your house? Have they had the life experiences you've had? How am I supposed to know your criteria for determining value value, impact, and results unless you tell me. If you tell me and I agree to it and then I don't do it, fine, I will accept that we have a problem. But if you've never told me, you've never explained it to me, you've never shown it to me, you've never held me accountable for doing it— if you're complaining, leader, the problem is with you, not with your team. It's that simple and it's that complex.

I think you've given me plenty of food for thought. I— if people want to dig deeper into your work, obviously I'll pop links through to the book and your website. Where are you most active sharing these ideas?

I appreciate that question, David. I'm most active sharing these ideas on podcasts and in person. Okay. In speeches and that. I am not big on social media. The best place on social media to find anything for me— and by the way, it's not going to be a lot, folks, I say that respectfully— is LinkedIn. Anywhere else, I'm a lurker, not a poster. I'm thinking about doing more posting in the future, but right now the thing I love to do is give speeches and go on podcasts. So if you go on Spotify and you search my name, you'll find hundreds and hundreds of podcasts. Go to my website, there's more information there about the books and about ways to engage with me. But my theory is we know this stuff. So many of the things I shared today, and I say this respectfully, the people joining in our conversation, you knew a lot of this stuff already. You maybe have a different look on it or a different angle, or you hadn't thought of applying it that way. But we know as humans we need to care for the other humans that are important to us. We know as humans that if we want longevity, we need to do some basic things. I was thinking about our conversation, and I'll close with this: who taught us us how to brush teeth. We know that brushing our teeth and dental hygiene is really important to our health, our well-being, and our longevity. And yet you and I both, David, have gone through the world and met plenty of people who did not get taught how to do it the right way. And we've also met people who appear to have been taught how to do it the right way. How do we not have best practices for brushing our teeth? We know we're supposed to go to the dentist once a year, or depending on what part of the world you're in, once every 6 months, or once every few years. But I don't know about you, rarely, only when asked, I'll go into my dentist and I'll say, hey doc, show me your favorite toothbrushing techniques, because this is an expert. I want to learn. I went into a dental hygienist recently and I said, I've been flossing for a while, how am I doing? Doing? She said, you're doing pretty good. I said, what would I need to be doing for you to say I'm the best flosser in this practice? Oh, and now we learn. In every business, in every organization, in every aspect of our life, there is an opportunity to say, is there a system I could learn and follow that would get me even better results than I'm getting day. And what I have found, and I imagine you found too, David, is that asking that question is never done. There's always a way to improve the system. There's always a way to enhance the system. There's always a way to get even better results. Most of us just aren't even asking the question.

Yeah, I, I think we are going to have a part two. Yeah, I'll put the links through to your different channels that And I know we're connected on LinkedIn, so I'll be keeping a close eye on when I do see things pop up, but we'll definitely continue the conversation. Just wanted to give you a huge thank you for being so generous today with your time.

David, it's my pleasure. Thanks so much for having me on the show, and thanks to everybody who was kind enough to listen in. I hope you came away with a few ideas, a few things that you can do in your business to create the kind of remarkable experiences in the first 100 days and beyond that will keep your customers, your employees, your people coming back for more.

You've just been listening to the Business Processes Simplified podcast, powered by System Hub. Remember to grab the show notes, templates, and resources at systemhub.com/podcast. Until next time, all systems go!