Scaling from $100M to $1B: Leadership, Labor Shortages, and the Future of the Data Center Industry with Steve Wortman

You're listening to One Sharp Sword, cutting through to what matters most with Outfluencer, Dr. Wayne Pernell.

Welcome to One Sharp Sword, cutting through to what matters most. I'm your host, Dr. P, Dr. Wayne Pernell, your host, your guide, and your coach on this journey. Today we're talking about data center industry growth, AI-driven infrastructure expansion, and how companies scale from a million— I'm sorry, $100 million to $1 billion without collapsing under their own success. That's big scaling. My guest is Steve Wortman, CEO and President of WMG. Steve is a seasoned executive who helps private equity firms and infrastructure companies navigate explosive growth in the fast-moving data center and telecom sectors. You'll want to listen in today for insights into scaling operations, managing leadership bottlenecks, juggling skilled labor shortages, building structure for hypergrowth, and the human journey through all of that. Steve Wortman, welcome to One Sharp Sword. So glad to have you here.

Yes, thank you, Wayne. So I really, again, I appreciate you having me on, on this, on this podcast today. I'm pretty excited to, to dive into some of these topics, uh, as it's a, it's very frontline of the industry, and at the same time, it's a major pain point in the industry. So there, there's a lot of things happening, um, and it's funny how they all tie in together. But again, it begins with the people at the beginning of it.

It always comes back to the people. And I'm so glad you said that, Steve. This is right. So why I wanted you on the podcast is because you have that people thread throughout all of this. It's kind of like, oh yeah, we scaled and we got to a billion. It's like, that's awesome. Really great. Nobody else, like how many other people can say that? And at the same time, there's this, you know, it's all about the people. Yeah, there's platform. Yeah, there's process and structure. But there's platform, there's process, and the third P in that is there's always people. So can we talk a little bit about what happens when operational scale outpaces leadership capacity? Let's start there. Like, we're diving right into the leadership piece of this. What are you seeing? How have you seen it? How, how has it caused near implosion for some of the organizations that you've, that you've touched? Let's talk about that.

So it's interesting that you want to start with that because obviously we're going to dive right into the main pain point or the main Achilles heel in the industry for these companies.

Yeah, let's do it.

And what it really is, you kind of already just led to it, right? It's the, the leadership team, the true executive leadership team of these companies. And again, we're talking from small startup companies to large corporations. As the growth has had unprecedented scale in this industry, they have scaled so fast that the organizations are changing in front of them. And some of them just, they don't see it or know how to manage that from a true day-to-day operational standpoint. Or how to forecast it as well. You know, revenue is one thing, KPIs are one aspect of the business, right? But then how do you truly scale an org chart? How do you scale an operational org chart where you don't have some of those levels that currently exist in your, in your company? You know, from managers to directors, sometimes companies have to add in that senior manager or that senior director before you get to a VP level Um, you know, add other C-suite positions as well, just because once you get that much growth, so many managers or leadership people start wearing too many hats. And then, and then they start failing. They start systematically failing because they can't really stay on task and track appropriately what needs to be tracked. And, or they are like, you know what, it's too much. I can't. Take in that much data and then give the feedback I need to my team to make sure we have proper responses, whether it's internally or externally.

So there's a difference between stretching somebody, right?

Yes.

It's like we, we all need to stretch in order to grow. We all need to go beyond what we think our current capacity is. And there's a difference between that versus being hammered day after day after day. Now they want this and now they want that and the environment's changing and we're getting, We're getting Wi-Fi 7, and now we have to amp up or ramp up for new infrastructure. And now we've got— and there's so much pressure. How do you know the difference between we're ramping up, we're growing, we're all running a little bit faster versus I'm out of personal bandwidth, like I can't give anymore.

Yeah. And so that there's some, for some people, it's a fine line. And from some organizations, it's a fine line because it's really knowing who your people are truly, not, not just your, your direct reports, but skip level, you know, from a meeting with your boss's boss, right? To make sure that you're staying in tune with them, to understand truly what their strengths are, but also what their passions are, you know, what, what makes them unique or really good at that position. Versus their day-to-day activities in the job. Because, you know, someone may— their job may be just doing reports, you know, updating Gantt charts, for example, something example. But they may already really have— be really good at other aspects of that job that's not utilized very well or that the company doesn't focus on. So it's knowing what else they bring to the table and then keying in on their strengths. But also maybe what are they not good at? Finding that out. Sooner than later saves a lot of headache because that's where you, like you said, my bandwidth's tapped out. That's how you burn out your leaders. That's how you burn out your good employees to where, you know what, they start getting disconnected or they start looking for other jobs. Be like, you know what, my X amount of salary is not worth this. It's not worth this headache. I can go to this competitor and make even more, probably with less responsibility, you know? Yeah. Um, and, and in this industry, it's been happening for several years in this specific industry. Um, and they've already coined a term for it. It's the revolving door, right? It's the recycle effect because they're not really getting a lot of new talent in because talent that has become very limited over the years. So what are they doing? You're just recycling from one company to the next, to the next, and 3 or 4 or 5 years from now, you may be getting that same employee back.

Just because, you know, and paying more.

Exactly. And you are going to pay more for it as well, right? That's the other reason why these employees are doing that. For example, one, it's not that everyone wants to jump for a buck per se, but at the same time, it's how are they treated, you know, as a whole, you know, the company true culture. You know, a lot of companies— this is a pet peeve of mine— a lot of companies talk about culture and say they have a great culture, and then once someone signs that contract on the dotted line, they get in the doors and then they really see what life is like. Culture is not a banner on a wall. Culture is not what we preach and pray on, on these meetings with executives. Culture's what is my daily life in this company? How are my interactions with fellow coworkers, with leadership, and with customers or clients? That's culture. Because how you report, and does someone have fear of giving bad news, you know, or, or like a sales manager or salesperson, right? If they may be down in sales a quarter, And someone says, well, you're not performing very well. You know, I don't know what next quarter looks like for you. That's— you're operating out of fear instead of out of a support system. So culture is a key piece of that. And that's another reason that's creating, again, this turnover effect.

This was one of the reasons I wanted you here is because, you know, you and I sing from the same book. You know, it's culture, the human experience. In the face of emerging technology that, you know, there's so much fear that came through. And I'm not sure if it was real or if that was just a narrative of, you know, AI is coming to get your jobs. That was a lot of fear. And I don't know if that was real. What's real is what the message that's settling out now is AI is not going to take your jobs. You, as an individual, need to learn how to leverage AI the same way that we learned how to move from riding in a horse and buggy to a horseless carriage. You know, it's like, we need to learn how to adapt to new technology. We all have laptops and cell phones now. And You know, those weren't a thing just how long ago, right? So, so this is one more tool to use. The fact that it is learning really fast, it itself is learning really fast. That's, that is something. And it means that it's, it's outpacing our ability to learn. Okay. If that's the case, then as a leader, what are we going to do for our teams in leading? And you know, as a team member, what are we going to do to keep up as best we can? And I think that comes back to culture. As a leader, it's up to you to, you know, to make a statement about what is the culture. Who are we to each other, I think, is really the best way of defining culture. Who are we to each other? How do we show up each day? And why? Like, what are the values? Right.

And so I want to say something. You see, you're kind of getting it on the head, right? Is with this AI that it— again, there was a, there was a lot of fear. There was a healthy fear of AI taking their job, as you said. And what people are realizing is AI is here. It's here to stay. It's not a fad. It's not a trend. It's— so how do we adapt to it? And what AI is doing or forcing upon us AI is forcing us to adapt. It's not that you're losing your job, but your job may change. Aspects of your job may go away or may become more efficient because of the AI aspect, right? So it's one, it's companies utilizing that the right way and implementing it the right way to support their people. And again, it's about— it really is about the delivery, right? Right? How do you deliver system change? Because, you know, we're older now, you know, we're more senior in our careers. What was our fear when we were younger? And what was a lot of fear?

Change.

Change management, change processes, right? That's always fear because you hear change, you— we always think of the negative connotation. We think of the negativity with it. One, some people fear, think that change means job loss, and that's not the case. It's, it's what are we changing and why? If AI is there and it can do something better, faster, a redundant routine better than for us, that gives us more time to do other things. That gives us more freedom to do other aspects that may need our attention to where AI can do a redundant, you know, chart sheet or something that we may need processed out or something real quick. We're tracking certain KPI indicators. So it's a really good thing. So from a company, It's how you deliver it and how you launch it internally in the company. And then as an employee standpoint, it's, it's a few things. It's, you do have to be able to be open to change. You have to be able to be open to say, okay, what does this mean? What do I need to do? And how can I make myself a valued piece of the company still and more valuable? You know, what am I bringing to the table? And there are, there are going to be limitations for people. Some people are, they're where they're at. And they're either maxed out bandwidth-wise, as we say at PC, or, or true capacity of understanding, hey, this is beyond my realm of understanding, and I, I, I just, I can't keep pace at what that is. And those people, here's the thing, not that they lose their job, but they may be— you'll be stuck in a certain position or certain level because that's kind of where your niche is, okay? And, and here's the thing, some people, that's fine. I've had employees at companies, they're fine with that, and they actually like that because they know that's their sweet spot. You know, they're not overtaxed and they're not overworked and they know the company still values them. But at the same time, they're not going to be the next person to change the next process or whatever. That's not going to be your go-to person. So identifying who those people are, that's where it all— again, it just kind of feeds off itself.

That's amazing. I, uh, I really wanted to call out and underscore the The idea of you need to ask yourself, what are you bringing to the table? I think that's important for each of us. Every day, it's sort of like I wake up and I'm grateful and I ask myself and sort of the cosmic powers, how can I serve greatly today? And I want to be challenged to step into the next place. I want to— I don't want to— like, how do I serve greatly but not too greatly? Because that's a lot of work. It's more like, right? How do I show up? And that means I need to hone my skills. That means I need to learn something. So showing up greatly really means showing up in a way that you're willing to be open to learn. And I think from a leadership perspective or vantage point, you've got to model that way. You've got to show up as a leader that says, hey guys, the environment's changing. What we're producing still matters. Here's why it matters. Our core values matter. This is great what we're doing, and the reason we're doing it matters. And we're gonna, we're gonna do what we do slightly differently. And, and to demonstrate as a leader that you're actually willing to learn how to do that, because there's no way as a leader you can keep up, uh, with the team members who are actually using the, the the new processes.

Correct. And yet, and you're hitting it on the head, right? The other part of that is that leader being able to listen to that feedback as well. And listen, because not all the processes, they're not all going to be smooth transition. They're not. There's going to be bumps in the road. There always is, especially as we're talking about the growth in the industry. The data center industry, it is growing at a pace it never has in history. Never. Um, again, all the new AI builds, versus the cloud compute space builds, you know.

Oh yeah.

Cloud compute space, we're never gonna need any less than that. We're never gonna need today less technology tomorrow than we have currently today. There will always be a greater need. There will always be a greater need because information is not going away. It's not just disappearing off hard drives. It's not just you, you store it in, in, in a filing cabinet and then boom, it gets destroyed when you demolish that office building or something. No, it's always gonna be stored somewhere. So it, it, it's about the need. So growing along with it is again listening and understanding what the change is, but taking that feedback with it and say, okay, what'd we learn from this? This didn't go smooth, so how do we learn from that and go forward?

So if I used a term like operational leverage, what would you do with that? What does that mean to you?

So operational leverage does mean a few things for me. One, it, it, an aspect internally with a company It's leveraging your people to be able to perform the best they can, but you being able to support them as a leader, giving them the tools to make them successful. Um, again, I've been with a few companies where they talk about, you know, how do we do it better, how do we get it better? And, and they, they say they support their employees and they do a lot of things, but when it comes down to it, that they really don't. They actually don't provide the tools to support that success growth of that employee or that manager, you know, but they'll talk it or then when they don't see the results that they expect at the end of that quarter or the end of that year, they're very quick to say, well, you didn't get this done or you didn't do it. Yeah.

Outward blame versus accountability. Correct.

Instead of asking why or how didn't we get there? Let's sit down and let's dissect this a little bit. So I, I, I've seen that too many times in my career.

Yeah, this is a— it's a big one. I, I— a while back I learned about the idea of friction, you know, the idea of, of a leader's real role is to reduce friction for their team members to be able to do their very best in their jobs.

Yeah.

And, and that is, you know, that, that is you as a leader being accountable. And for our listeners, for our viewers, that if you are listening to this and going, yeah, that's good, you know, a leader should do that. You're the leader in your own life. You're the leader. What are you doing to make the people around you have a more effortless life? What are you doing in your world to affect the lives of others around you? Even if you're a team member, you've got colleagues at your shoulder who could probably benefit from you doing something different. So, hold yourself accountable. I'm a big fan of saying, you know, we're all leaders. We're all being watched somehow. We're all being observed, and we're all contributing. So those acts are acts of leadership.

Yep, I agree with you completely. And that's the biggest thing, is knowing what they're doing and the why behind it. I tell people, I paint my— I like to paint my employees pictures, you know. Don't just say, hey, here's your task, do what it is. Explain the how, what, when, where, and why, you know. Give them a picture of why we do this process, you know. If we're pulling all this fiber, 500 meters, and this is the task today, there's— why are we doing this? If you give them more, the more information you give them, it makes them feel, one, more included, more involved with the company, more connected. Um, because your, your lower-level people, you know, your entry-level employees, sometimes they're there for a paycheck, and that may not change for some people. They're there for the paycheck. So, but there are one who do want to grow or have bigger aspirations. So how do you make them feel connected? You know, and again, it's connecting with them, having conversations with them, giving them good information about why we do what we do, and also what makes us successful, what makes us good. Be proud of that. Agreed.

Agreed. I, you know, just, uh, I don't know that more information is always better. I do know that because at some point it's like, you know, in your own role, it's like that's information overload. But understanding, getting to the place of going, oh, I understand that what I'm doing matters. This is why it matters. This is what the expectation is. So I'm aiming for the expectation based on this really does matter to the end user, right? The person who's going to end up with the piece. So even if you're— I mean, at a very basic level, and it's so important, right? If you are a maintenance person or if you are in a stockroom or responsible for the retail items on a shelf, you want them accessible. It's not just like, oh, you know, throw them on a shelf. It's like, have them available. Why? Because it matters to an end user who goes, I can access this. This is great.

Yes.

Let's talk about friction that you're seeing out there. Where are you seeing the most friction as growth increases? Where is that? And it could be back to, well, people don't have enough information, so they Right. So where are you seeing it?

In the data center specific industry, obviously a high focal point of my company is growth, right? Scalability, because the end user, or we call them hyperscale clients, you know, there's the Big Five and then you have colo space clients which will have multiple tenants inside of one housing building or campus per se. And it's really that relationship between the client and the contractors it's very demanding. It's very schedule-driven processes. So when you win an award or winning a contract and that client wants you to have 200 technicians at site next Tuesday, it's, it's always the impossible ask. Again, it's because of the scale and the growth that is happening that it's driving this. It's, it's driving this premise that didn't used to exist on this level before. Again, these are unprecedented ask of ramp schedules and load schedules for new builds or even retrofitting a current campus. So what causes friction of it is it's a few pieces, right? That company to be able to support what the client's asking. And then two, at the same time, delivering a good product. And when I say good product, doing that work scope as that is designed and written and drawn out. With very good quality people. Um, a lot of companies are failing at that. A lot of companies are truly failing at that piece. Some of it goes back to simple training, investment in training purposes, because they don't want to put that overhead cost into their— out of their own pocket. And then two is finding enough quality people in the industry to be able to do that work. The industry pays very well. It really does. But we have the least amount of skilled labor in this industry that we've ever had. In the past, and I say I focus the past 30 years, I was at a conference at the end of last fall. We have the least amount of skilled labor in the data center history since honestly mid-'90s. We've never had the least amount of skilled labor at actual technician levels that we've ever had.

That's what I'm hearing actually across industries.

Yeah.

Right. I'm in touch with interviewing and working with multiple industries, multiple verticals. And that is exactly what I'm hearing is that we have a labor shortage. Robert Half, PricewaterhouseCoopers, like they're all reporting 67% to 71% of the market is basically they feel like they're understaffed or underskilled.

Yeah, yeah, yeah. It, it, it is a true pain point. And it's funny because a lot of conferences and calls that I've been on for the past few years, they focus on the data center industry. They talk about land, power, water, you know, deployment, you know, when can they build the core and shell of this building, how fast can we get it operational. And so many times they never address the people part of it. And, and it drives me crazy because I I, I go to have so many conversations with, with CEOs, with executives, with these PE firms that are buying these companies, and they're like, what is their weakness? And then you start digging through things and you find out right away their weakness is very apparent. It's they don't have the skilled labor to support what the ask is, or, and they don't have enough of them. So it's one skill level, as you're say, as we're saying, but then it's truly enough of the actual people to do the work.

It's amazing. Let me jump back to you for a second. The, um, what would you say— this kind of, this kind of fun— what would you say— you've worked with organizations at the million-dollar level and you've worked with the organizations at like the $1.2 billion level.

Yes.

And what would you say are key differences in those operating styles, you know, because for a lot of, for a lot of businesses, even getting to the million-dollar mark is a huge milestone. So, right, so, so there are going to be parallels from someone who's starting up to getting to the million-dollar mark, from someone who's at the million to the $5 million, and from, you know, $50 million and then $100 million to the $1.2 $1 billion mark. So what would you say are the biggest differences in that leap?

So, uh, there, there's a few. Um, some of it really goes back to systems. Um, truly being able to invest in, in like ERP systems, SAP systems, you know, truly a Power BI depending on the industry you may be in. That, that, that, that's a key player, right? Once you get to certain scale size, you really have to have your processes in place. To make sure that that grow can have a trackable and traceable process in place. So it's not just one-off, like I was a mom-and-pop shop and I did it this way this week. Next week I'm going to try it this way. As you grow, you can't do that anymore. Um, again, a pre— a previous company that I was with, um, it really blew my mind for the size that they were at, that they were doing time cards on Excel timesheets. That was mind-blowing. Once I joined the company And I got to discover it away and I was like, what, what it, it made me question things. I'm like, what are we doing here? How's a company this size doing over a, over $200 million still do that process?

Because how big was their accounting department?

Because very, it, it was less than 5 people. Really? Yes. Wow. Yes. So that you had operational team members really trying to process and doing time cards on a Sunday. To make sure and get to the payroll department on Monday and get it processed. It was, it was a very scary thing to see that. But they failed. What they failed at is investing in systems and processes early enough on to be able to meet the growth that they were having. And they really had great growth for the past few years. They've had the best growth they've ever had in company history, but it was with through a lot of aches and pains because they didn't invest on the front side. To, to see what that looked like or how to scale to that next level. And that's what I see a lot of companies do, because I have smaller companies. I've worked— did consulting many years ago, and I did a lot of smaller companies, right? To get to that first million, $10 million, $30 million revenue process, right? Very simple, because you may have a small employee count. So at the beginning, you're kind of figuring out, learning what this looks like, and then you try to say, what can this be And you have to ask the question, what can it be? Well, you have to, you have to really draw out that roadmap. What do I envision being? And then what is, what can I really do when we have this amount of funds to invest in this? And also getting the right people in place, getting people to know what that vision looks like and know how to grow at that scale. And as you said, I appreciate that, as you know, I was one of the few people that probably ever seen or managed a company profile. Of over a billion dollars in my previous company. I think there was maybe 3 or 4 people in the whole company that's ever seen something that scale.

That's pretty incredible. That is pretty incredible. You're talking, you're watching me smile really big. And the reason I'm smiling so big is that you're, you know, you're prompting things that are just perfect for me in my world and in the world of, you know, those that we both touch actually. Yes. This is what it looks like. What can it be? You know, that's— it's— I just, I really want you to land here for a second. This is what it looks like is if you, any of us, could pause for a second and go, this is current circumstance. What we have right now is current circumstance. What does it look like? How— like, just take inventory of your own life, let alone your company. What does your life look like? This is what current circumstance is. It's not scary, it's not ambitious, it's, it's neutral. You have new neutral information. This is what your life is. Um, you owe money here, you're building this, you're growing that. Great, that's current circumstance. Fantastic. What can it be? And that leads to what do you want it to be, right? And when you get a really clear vision about what you want it to be, then most people— that for so many people, and I know you've seen this, Steve, that for so many people is the stopper. Well, I kind of would love it if it was this, but I don't know how to get there. I don't, I don't know. So we're good with what we have. You know, and they won't take the step because— the next step— because it might be the wrong step. And it's like, it's scary, right? It could be the wrong step, so what? You know, you're gonna get information. Um, I'm not a fan of, you know, there's, there's all the messages of go out there and fail and fail a lot, and, and I, I think it's a slightly Off-centered message.

I would agree with that statement.

You know, I wouldn't send anybody out to fail on purpose. Go out and try stuff, right? It's the nice side of FAFO, right? F around and find out. Awesome. Because you're going to get feedback, right? You're going to get— and that feedback is information, which is also neutral. Right. It only, it only is good or bad based on your, on your presentation or your interpretation. So I'm a huge fan. I just— you were speaking and it just lit me up and I wanted to go on my own riff for a second. This was— it's like you have current circumstance, you get at any point to say, what can it be? And more important, what do I want it to be? What do I want my life to look like? What do I want my company to look like 5 years down the road, 20 years down the road? Project yourself forward and see yourself in that space.

So, I'm going to piggyback off that because now you got me excited with it as well. And the funny thing is you said some of them, and you know when they do, they had that clear vision of what I think it can be or what I want it to be. And when they do, they're, they're pretty honed in. They're pretty locked in. Right. But the other side of that coin is, and you also kind of touched on it, is the ones who don't know are scared to make a decision because like, well, what if I fail? And I agree with you. I don't think, well, failure leads to success. Or, you know, I tell failure is success. I'm like, I agree with you wholeheartedly. I don't like those statements per se. Failure is not failure. Can help. It really can because one, you get data points from it. You get really good information from that. And but what it is, what do you do with that information? What do you take from that to learn from it, to not do it again? Or what was the positive in going this route versus, you know, X, XY versus Z? Um, taking that information and saying, okay, I know what this resulted. How do I get the result I want by doing something different? I know what this kind of led me down that path, right? So it's, I, I tell people, I hate failure. Failure, failure is always good. Always good. I, I've seen a lot of speakers that, that kind of promote that and preach that. I, I'm with you. It's like failure happens. It really does happen. It, it's, it's society. It's human. It's business. It's, it's a lot of things, right? It's, but it's what you take from that failure and really how you manage expectations and say, okay, what can I do with this? Or what other information do I need to get? From maybe outside sources that can help me get a better decision or a better avenue.

That's exactly right. And you don't need to label it good or bad. It's information. It's neutral. It's sort of like when you set your GPS and you come, you know, your GPS says move forward and you're like, the road's blocked. So, I guess I get to choose which way to go. The GPS doesn't go, that makes you a bad person. It's like, oh, let's adjust. Right? It's like, what's adjust?

Recalculate route.

That's all it is. It's new information. Recalculate route. It's so good.

Yeah.

Let me bring you back to one thing that you were talking about too. How do you know in the process of growing that it's time to invest in new processes? Right? A lot of people don't know, like, like the, the whole time card on Excel spreadsheet things. It's like at some point they went, we'll deal with that later, and they put it off, and maybe it was brought up again, maybe it wasn't. Later was the decision. How do you know, like, for you when you deal with organizations, right? And it's great, like, you know, there's no— I don't think there's any one single answer to this. I, I'm just curious about your take on how do you know when it's time to, you know, invest in more people or you know, or in new processes?

So it's— that's not a simple answer because I'm going to give an example on this one. I had a client back in November that was getting ready to do their next year planning, you know, the next 4 quarters, the next 8 quarters, 1, 2, 3-year plans. The company, they're really good at strategizing, you know, not just the next year's plan, future forecasting, but 3 years out. And not just throwing out random numbers. They really were trying to hone in from a CapEx standpoint to an OpEx standpoint. And on a few of the calls I was on with the president, with the vice president, the CFO, the CTO, the COO, the conversation started happening and they're like, well, I won't say, but one of the members of the C-suite, they literally said, well, let's just do 4% annual CapEx.

So I'm gonna pause for a second. Some of our viewers, audience members aren't in finance. So CapEx is capital expenditure, which is typically a one-time expense. And OpEx is operational expenses, which is kind of what it takes to keep the organization going. So it's an ongoing expense like people.

Exactly. Yes. Yeah.

So, so you're working with an organization that goes, let's just give 4% to CapEx.

Yeah. Because, because in previous years they did it and they always stayed within their margins of where they wanted to end up for EBITDA. Right. They really wanted to stay in there. And so I started. And again, the reason why they hired me and my company was they really wanted the home and more to have a better, a better understanding of why that is. So I started bringing them questions and made them give them a report. What justifies the 4X? Like, are you going to have a big expenditure in vehicles, office equipment, a bunch of new televisions? Are you buying a new office space? You know, whether it's East Coast, West Coast, those are large expenses. Those can be very large expenses, right? Yeah. How much of that is real versus how much is it— is— all right, we're planning on doing this, but we really haven't locked in the fine details of it. So what is it?

Is it going to be amortized? Like if you're buying land in a building, are you doing all that expense this year or are you going to spread it over multiple years, in which case the 4% can go a lot further for multiple projects.

Yes. So that's really what I gave back to them is like, I basically, I gave them homework is like, you got to figure out what does that look like from a realistic standpoint? What is this going to cost out of pocket? I tell people, you know, treat it like your bank account. It's not what you're putting on your credit card and you just pay it off over time. It's what are you taking out of that actual bank account today or at this moment in time or this quarter? What does that cost out of your bank account? Rev, you know, of true profits that you have out of that. And they got better at it, but then their operation X, how they wanted to compensate because they really wanted to find in the CapEx, their OpEx went out the roof because they're like, we're going to have a lot more operating costs on a quarterly basis now. And here's the thing, they were because the growth they were having, they just didn't know how to forecast that growth that well at the time. So we really spent several weeks digging into that.

That's a tricky, like, if you love puzzles, that's a beautiful place to have a puzzle because you're now juggling, is it a percentage of what we've made or is it a percentage of what we are planning to make?

Correct. Based on forecast.

Right, based on forecast. So is it a dollar amount or is it, you know, we want to invest this much money, what percentage does that work out to be? And, and I mean, we could each do that individually as well. Like, you know, as we, as we grow, as we do side quests, as we do, you know, if you're an entrepreneur, you're in charge of what you make. Um, so, you know, what's your growth plan? That kind of thing. It's an interesting, it's an interesting thing to be looking at all of the variables. And I guess that's really the answer to the question I asked, which is, well, as you're juggling, it depends on which ball you're looking at, but really you got to back up and look at all of them, right?

Yes. Yeah, yeah. So you got to be able to look at both ways, right? Both ends of the spectrum to get into the nitty-gritty details, but then look at that big picture from a forecasting standpoint.

Yep. This is great. Okay, so Do you think we've covered everything you wanted to cover? Because if you look at the time, we've actually like, it's flown, right?

Yeah, it has flown by. This has been a great call for sure. I mean, the only thing I focus on that I see a lot of companies, you know, we kind of touched on this in a previous call, is where I see a lot of failure is the companies are, again, they're growing so fast. That they're losing connectivity with their frontline managers, their frontline leadership.

Yes.

To really know what's going on. And I tell people, I don't like to coach behind, behind this, this chair, behind this desk, right? I really have to go out there, find out what's going on at the job site because it, once it gets filtered 3 or 4 times from different levels of management before it gets to the leaders and everything, it's pretty well polished. Or, or the bad news is maybe not such bad news anymore. And I tell people, it's not bad to have bad, tough conversations. And, and I say this to a lot of leaders and everything too. I don't mind the tough conversations. I actually enjoy them because I, I like to focus on one, what's the problem out of this? Now, I don't focus on the person. I focus on the problem so that we can really work towards a solution, really finding out what aren't we good at or what aren't we doing right and being honest about it and saying, okay, How do we attack it? How do we get better at this? How can we make this a smoother process? How can we make this a smoother transition where information's flowing more frequently, right? That's what I actually see a lot of companies are really failing at because they're failing to grow the upper leadership team or the executive team is just kind of too far detached from what's going on in day-to-day life.

This is so great. I interviewed somebody else recently who was in a different vertical. And they said almost the identical thing, which is you've got to focus on the problem for the sake of solution, not focus on the person, because all too often it is the process and not the person that, that is really slowing things down. Yeah. So, uh, so instead of ending on a— this is the failure path— what would you say is a great success path for an individual and a company?

Honestly, for an individual, at different levels, right? Ask the questions that you're curious about. Make sure you're asking questions with direction and with purpose, you know, and be ready for the feedback. Be ready for honest feedback. You know, that's whether you're a manager or an employee. But at the same time, just make sure that you're open for both ends of communication, right? Asking but also receiving. Make sure you're listening to it. And then for, you know, as a company standpoint, be prepared for the tough questions. Be prepared to give honest answers, even if it's not the prettiest picture. You know, even if a company may be doing layoffs or something, or a company is— their quarterly projections are not where they're at. So bonuses might get tweaked a little bit this quarter or this year, right? Having an honest conversation of why. Yeah. And don't, don't blindside them. Do not blindside them. Because that's where I've seen on sales departments, I've seen a lot of that turnover happen in those industries because of that. So, make sure you communicate ahead of time what's going to happen before something happens or they get this, their paycheck and say, oh my God, what happened here? And now they're all upset and up in arms.

Yep. No one likes the negative surprises, right? Right. Especially with sales organizations where They're expecting this big payout, big bonuses. We hit this mark and leadership says, well, yeah, we hit that mark, but we had these other expenses and, you know, sorry. And it's—

see that all too often. We do.

Yeah, we— it's— you and I are in this place of coming into organizations and, and having a perspective and being able to step back and go, do they not see what they're doing? Like, Yeah. Um, so yeah, I mean, the bottom line of what you just said is have values, be clear about what they are, live into them every day. Um, don't be afraid to have the honest and sometimes hard conversations. Ask questions, be willing to listen, um, and be willing to, uh, what you didn't say is be willing to say I don't know. Like, that's a right That's a huge, that's a huge part.

That is right. You don't always have to have the answer right now. If you don't, let them know you don't, but hey, I can get it for you, or let me ask so-and-so, whatever that needs to be. You know, don't— I tell people, don't make up stuff. Don't do that because you lose trust in your people that way and they lose trust in you very fast.

And that is huge. That is huge, right? Being trustworthy.

Yes.

Um, you've got to be honest with yourself. You've got to be honest with people around you. That is what builds trust. And if you don't know or you can't say, like I always, when I was running organizations, I would tell my team, it's like, you can ask me anything. And you may sometimes get the answer that I don't know. You may sometimes get the answer that I do know, but I can't tell you. And either way, I'm going to be telling you the truth. Otherwise, you know, I'll give you the answer if I have it.

So yeah.

That's so great. Good stuff. All right, Steve, how— if people want to contact you, how do they— how do— what's the best way of reaching you?

Honestly, multiple ways. You can add me on LinkedIn and shoot me a message on LinkedIn. I'm on there all the time. You know, my company's things are being updated currently, or they can reach out to my email, swortman31@gmail.com. That's my personal email that I always just have updated on all my devices. So I get notifications on here that really shoot through very fast. But I tell people LinkedIn or email is just the fastest, easiest way to get a response and make sure, because whether I'm on an airplane or traveling, I can get to those all the time.

Okay. And do you— I can't remember on your website, I believe not your website, your LinkedIn. I'm sort of scrolling through it now. I believe it's Steve versus Steven because sometimes I write it.

It is Steve, correct.

Okay, so it's S-T-E-V-E, Steve, and then Wortman, W-O-R-T-M-A-N. And so you can find Steve Wortman on LinkedIn or S Wortman, S as in Steve Wortman, W-O-R-T-M-A-N31@gmail.com. I've had people come back to me after the recording of the podcast and go, I gave my personal email. Could we cut that part out? And you were pretty deliberate about doing it. So I'm really delighted that you've done that. Thank you so much. No problem. Good. Any, any final words or comments that you wanted to offer?

No, honestly, like I said, I just tell people, have the conversations, ask the questions. It's very simple. As you're growing from a company standpoint or an employee standpoint, make sure you know what you're looking for and asking for. You know, just be transparent. I used to use the term, and I tell people I'm a pretty direct person, be brutally honest. I'm very direct, but I always say be direct, but be respectful. You know, never be disrespectful, always be respectful.

I'm gonna— I think that's the quote, right? Be direct, and I'll say 'and' instead of 'but.' And be direct and be respectful. I'm typing as I talk to you. So be direct and be respectful. Excellent. Good, good, good way to end this. Thank you.

Yes, Steve.

Yeah, perfect, perfect. You are, you are so welcome, and thank you for, for joining me. Steve Wortman has been my guest on One Sharp Sword: Cutting Through to What Matters Most. I'm your host, Dr. P, Dr. Wayne Pernell, your host, your guide, your coach on this journey. Please join us again next time and If you like this, I would ask you to comment where you feel like you've been, um, maybe direct and also respectful. How has that shown up for you? Um, just talk a little bit, you know, let's get some engagement around this. So where— what's been the hardest place that you've been direct but also been respectful in doing so? All righty.

And Wayne, if you'd like, also, you can share this podcast on LinkedIn as well. So we can get maybe get a feed going off that as well. I've had people do that in the past, where we kind of get comments back and forth and feed off of it. Very good.

We've got, we've got the, we've got reels on LinkedIn, we've got the podcast going. So definitely please ping back and forth. We'll see you again next time.

Yes, thank you. Thanks for listening to One Sharp Sword, cutting through to what matters most with Outfluencer Dr. Wayne Pernell. For more information, please go to onesharpsword.com.