In this informal, podcast‑style conversation, host Jim Bouchard interviews Ian Smith, founder of The Portfolio Partnership and author of The Acquirer’s Playbook and Fulfilling the Potential of Your Business. The dialogue weaves together the human and technical dimensions of company exits, exploring why many founders would never buy their own business, how culture, employee engagement, and measurable morale become critical valuation levers, and why scaling for a buyer differs from scaling for growth. They unpack a practical 15‑criteria, five‑bucket framework that buyers use to score targets, discuss the perils of “command‑and‑control” cultures, and illustrate the value of “walking the floor” to sense hidden issues. The conversation shifts to the rise of smaller‑company acquisition trails, the distinction between growth and scaling, and the importance of clear strategy, execution, and governance—especially around sales commissions and performance profiles. AI’s role is examined as a catalyst for faster data gathering and analysis, but the speakers stress the irreplaceable need for human judgment, storytelling, and “tough‑yet‑compassionate” leadership. They introduce the concept of automated “triggers” for key performance indicators, argue that value is exposed rather than created at exit, and close with practical advice for entrepreneurs on polishing their business like a diamond before a sale.
Chapters
You know, over the past few years and the various podcasts we've done, we realized that some of the best conversations we've ever had never made it to one of our shows. They were either calls that where we were trying to get to know somebody or just conversations we had before or after we actually recorded an episode. So we decided to do a little experiment. We're just recording some conversations and if they're good ones, they're going to turn into podcast episodes. If not, you're never going to see them. This next one was an incredible conversation I had with my friend Ian Smith. Ian is the founder of The Portfolio Partnership, where he's helped companies all over the world position themselves to be attractive to buyers. He's worked in mergers and acquisitions. He's been an investment banker. His experience is just amazing. And he's the author of two incredible books, The Acquirer's Playbook and Fulfilling the Potential of Your Business: Big Company Thinking for the Mighty Small Business. Let's get into it with Ian. You know, Ian, the last time we talked, you were talking about how difficult it is for private companies to make, shall we say, graceful exits?
Right.
And I know I want to focus on the human side, but I think probably you should talk a little bit about the technical side too, because I think in this case, probably more than any, the two are knit together. And the reason I'm saying that is because you've talked about this, a lot of emotion when we're exiting, having, creating a company exit, whether that's something that's forced on us or something we're choosing to do because it's a sale, right?
Right, right, exactly. Yeah, it's, I mean, we both in different ways have been up close to this entrepreneurship thing for quite a while. And, you know, AI and others—
because we couldn't get jobs.
Exactly.
Nobody would hire me. I had to work for myself.
Interview went well, but apparently not.
Yeah, right? I know it. That's right.
But yeah, exactly. We can have been up close to this either because we're on a payroll up close or, you know, in the last 15, 16 years on my own payroll, as it were, helping entrepreneurs. It's a fascinating subject and it's the whole exit process. There's so many myths around this subject that it's a delight to talk about it because if that bursts a bubble, then that's great. You know, people learn from that. And I can tell you that there are really some fallacies and some strange things. One of the basic things is, and this is almost bringing humor to it as well, I'll say to an entrepreneur as an example, and let's call him Jim. Why not?
Yeah. Okay. I mean, it just came to me there.
I don't know why. And you say to Jim Bouchard, Jim, so Jim, would you buy your own company? He'd say, hell no.
Well, obviously I'm not a good example. It's hard to sell a one-pony operation.
Frank, Bill, doesn't really matter. And, and like, you know, I'm, I'm not even an inch from the truth. I am telling the truth. They're like, oh God, no way. Okay, and so why would that be? Well, you know, I mean, I'm the main sales guy, you know, I build product, And you sort of, you start touching on this kind of almost a myth that I'll build a business and one day I'll sell it. Well, the reality is the data doesn't really back you up. You know, it's building a business that's transferable can be, in fact, it's the best way of building a business. It's more fun and you make more money and people say, What's that all about? So when I talk about scaling a company, I talk about scaling it with a buyer in mind, not a buyer, but buyers generally in mind of what they cherish. And what they cherish is actually things that will make your business more sustainable and less risky and safer. And people are like, okay, tell me more.
Yeah, well, that's what I was just going to say. Particularly, you know, you struck a nerve because One of the challenges that we find a lot of times when we're doing it, like doing workshops or whatnot, is that people sometimes don't— they have difficulty making, for instance, culture a tangible item. And I know it doesn't show up on the balance sheet or anything, but to me it seems like that's one of the most valuable things, one of the things that makes a company so valuable, right? Especially if you're trying to sell it. Who wants to buy something, someplace with a broken culture?
Well, I totally agree. And codifying that, Jim, I've got a list that I've built up over decades, and I've played around with it and tweaked it, but it's basically the same list, which is like, there's 15 criteria in 5 buckets, I suppose, really. But in criteria that buyers I know in my experience have cherished over the years, cherished to the point where if you don't have a high score in some of these attributes, it's not a discount discussion, it's a walkaway discussion, because they don't want to I don't want to buy a problem. One of them is culture in the sense of, you know, company culture. Is staff morale and employee engagement high? Like, that— a version of that is much more measurable these days. Now, in the first coffee meeting with a seller, a buyer's not going to be able to smell that or get that. But over a succession of meetings and documents a good smart acquirer can smell what that morale and that engagement is really like. There's all sorts of ways of tracking that and testing that. Sometimes you can see it in the mindset of even the sellers themselves in the meetings. And so that is like— so the issue therefore is why wouldn't you want your staff morale and engagement and those kind of things to be high? Even if you never sell the business, like, why wouldn't you want that for yourself?
No, well, Alfie, right? I mean, it's one of the key metrics. Metrics for performance, although that's hard to convince some people. But the other thing, when you said that, do buyers— what surprises me, and I know it happens in business, it happens in real estate, so I mean, we can kind of broaden the conversation, but this idea of buying things sight unseen seems to be more prevalent than it ever has been, especially when people have cash to burn or companies have cash to burn. Aren't they walking the floor? Because real quick story, I mean, one of the metrics I use when I'm hired by a company is I want to walk the floor. I want to see, and people think I'm kind of spying, but I'm not. The key thing that I'm looking for is the reaction, because a lot of times when I'm walking the floor, my guides are C-suite executives, maybe even the CEO, right? How are people reacting? And the best companies are the ones where nothing changes. You know, hey Bob, how are you? If they're taking a break, they keep taking a break. They don't hustle to cover up, you know. The worst companies are the ones where everybody scrambles because the boss is around, right?
It's a super, super point. I was, as you know, a recovering investment banker, which I did for 14 hard years in London. And then I escaped.
Is that how you substitute Guinness for that? Is that a good substitute? A good bridge drug to lower?
I'm recovering accountant, recovering a bit. I'm recovering lots of things, actually. I'm actually seeing the light now more than ever. And it was interesting when I was in operations before banking at Thomson Reuters as a young boy learning the ropes, really. I hankered over that as an investment banker because I couldn't really fix things as a banker. I just had to sell, you know, like, or buy them. Like, I couldn't creep across the line and say to the finance director or the COO, hey, there's a better way of doing this. I know a better way. You know, my boss would say, hey, sunshine, if we don't pay you to fix things, I was going to say, knowing you, you probably tried. Yes. So in more than one occasion. But the point being that when I say to clients, prospects or clients, rather, we won the business, maybe sell a business, they say, well, you've seen these before, Ian, right? I said, no, no, no, no, no, I'll be walking the floor. I mean, that was the first thing I do. And you'll have a cover story, you know, you know, I'm not the seller of the business job title, clearly, you know, walking around the floor. Because as you say, you, when you get good at this as well, and you walk a floor, you see things with your ears, you know what I mean? You, you, you, you see things that other people don't see. It could be, it could be dusty racks, it could be the way people greet you. It could be the politeness of people around the reception area, how people are interacting. There's a million, million ways that AI can't help you with, that only a human can help you with. You know what I mean? So I think that when one is building a great business, you might think you're building it to be transferable, but you really do— this is the jugular point— you really do have to walk around the other side and look at it through the lens of a buyer. And that will open up a whole bunch of thoughts that would be very helpful to know whether you ever sell it, ever, ever sell it. That's the point. It's a— yeah, you know, I mean, it's just a healthy thing to do. And say, well, look, what would that do for me? Well, maybe you would focus maybe on the concentration of the 4 customers that keep giving you business. Maybe it should be Maybe they shouldn't own 40% of your revenue last year. Maybe that's a little bit risky. What could go wrong? Well, one of them could fire you. You know, that kind of thinking. You may say, well, I think of that way anyway. I'm not so sure people really, you know, I mean, it's like—
No, I know. I know exactly. I mean, and as a microentrepreneur, we fall into that trap several times. I mean, because it's, it's You know, it's interesting because working on the new book, The Only Certainty, that's one of the certainty traps, right? Something happened before, so we expect it to happen again, especially when there's a lot of enthusiasm. And how much does that play a part? Because, you know, both the buyer and the seller can be very enthusiastic. There's the emotion creeping in again, right? For whatever reason, it might not have anything to do with what you're putting together as far as the deal goes.
Yes. I mean, we're doing quite a bit of work. There's a phenomenon that's coming through now, I believe. And I see it through, say, for example, the Vistage groups that I'm part of, and I see it in forums like that. And that is the world of smaller companies going on the acquisition trail has arrived. There's actually smaller companies. Clearly, the headlines like Brad Jacobs doing another $10 billion deal or IBM or something are still there. Mega deals are actually very, very active at the moment.. But the $50 million company, even the $10 million company, but certainly revenue-wise, or $100 million company, the opportunity to go on the acquisition trail is huge. It's huge. Because, because to go back to your point of enthusiasm, a business, a guy who's running, or a gal that's running, a husband and wife team that are running a $50 million business, and they come across a $5 million business They understand the pain that the $5 million owner is going through much more so than a corp dev acquisition director of IBM. Like, they just get no empathy, really. Now, IBM wouldn't buy a $5 million business. Well, they might, but it's unlikely. So in fact, when buyers and sellers come together, especially smaller acquirers, they've got a chance to bond quite quickly on core values because they've both gone through quite tortuous journeys. And a slightly bigger private company would never ever have the arrogance to say, you know, it's nice to meet you, Jim Bouchard, but I thought you'd be much bigger. It's like, sorry, say that. And so the thing about the emotional side of buying and selling is you really have to have a very strong process that allows you to leave the stage when logic suggests you leave the stage because Too many deals are so far down the line that there is a decision not to leave the stage when they really should. Oh yeah. You know what I mean? Like, you shouldn't really be buying it.
Yeah, you know, you just opened a can of worms because there's a lot of pressure to scale, you know? And I think both ways. I've met people who were exploring— we do a lot of work in healthcare. And credit unions face the same pressure too. There's pressure from the side where we want to be part of something bigger. So they merge or sell out to a bigger company. So there's that end of it, right?
Right.
And then there's the bigger company most of the time that wants to absorb the smaller ones. From a leader's perspective, what are the things you should consider if you're thinking about scaling at all? I mean, I know the dollars and cents, I'm not discounting the importance of that, right?
Right.
Sometimes there's some other questions we've got to ask ourselves, like, am I, as a human being, am I even prepared for this? Is this the right move for me? Is this—
yes, yes. I think the scaling thing is interesting because it depends what business you're in. I mean, if you're in, I don't know, like a headhunting business, and maybe there's 4 of you in the headhunting business and you specialize in, I don't know, petrochem or, uh, you know, semiconductor or something, you could be having a very, very nice living and the last thing you want to do is scale. I mean, the 4 of you are making some good money. Maybe there's a couple of research and analysts, and that's just fine. You know, it's not for everyone. And why— maybe why would you scale? But generally speaking, what scale brings is safety, because, because a manufacturer in Salem or whatever, you know, knocking out a great product, and it's quite hard without scale to get the margins you really want. And so ultimately, the temptation is and to start scaling, to at least get some decent procurement benefits from buying things in bulk, or you attract better staff and things become a little bit easier. So it is, you know, I see a lot of entrepreneurs and there's an element of lurching from payroll to payroll because it's tough, you know, visibility of revenue to see the next 12 months revenue is tough. And so Sometimes, you know, by accelerating your agenda, maybe through acquisitions and maybe through geographic expansion or whatever, you do create a kind of safer vehicle that the visibility, the order book is greater, you attract better staff. There's a kind of machine starts happening there, but you really, really have to be careful. There's a massive difference between growing and scaling. So growing is your Inc. 500, 5,000. I've just won an award again, you know, fastest growing company in, you know, yeah, Southern Hamilton, um, you know, and north, north of the Cape. And, you know, I've just won another award. Well, that's fine, but the trouble is that, that growth doesn't necessarily pay the bills, you know, cash flow does. So you have to be really, really careful in that scaling that you are you know, you are managing the margins. So for example, you know, the accountants would teach you that variable costs vary with revenue. Well, that's logical. Yeah, I mean, obviously that's why, you know, when I grow, I'll have to spend more money on materials. But fixed costs stay fixed. No, they don't. Fixed costs stay fixed for a period of time, and then that pesky finance person wants another accountant, or that sales manager wants another salesperson, our insurance goes through the roof. Our insurance goes through the roof, exactly. Or the rent goes up on the building. You thought, well, why are you— I still don't understand.
No, you hit it again because I made that mistake when I was in the martial arts business. We were very successful with a couple of centers and the temptation was there to scale and we went all in. We pushed all the chips in and then I found that, you know, a couple of the centers were underperforming, so the others had to carry it. And in the end, I actually did an analysis. I did one of these silly Well, not so silly. Time measurement analysis, right? Value for time. And I found out because somebody was complaining to me that I was underpaying them, which I wasn't, but they had unlimited commission, so I was underpaid. But I found out that I was making at the time about 91 cents an hour. And that's not cool. But I want to speak more to our CU friends because, you know, the credit union world is really— we've got to get you at some of these credit union conferences. I think what you're talking about really, really would resonate with them from the heart. And so you got to talk to Alex about that, right? But one of the challenges, they're under constant pressure right now to merge and to scale. And the challenge that I'm hearing all the time, particularly when we get them in the room, just the C-suite folks, what they're really concerned about, they're really worried about losing what makes the credit union special, which is a very intimate human relationship with their members. For people who don't know credit unions, members, they don't have customers, they have members.
They have members, right, right.
And so that's a constant challenge, but I don't think that's unique to the credit unions. Healthcare sees the same thing. How do you scale and still keep it human? Ah, snuck the brand in there, didn't I?
Well done. Keep watching me.
I could be a NASCAR driver now.
I mean, I don't— I'm not as familiar. I know of credit unions, but I think the principle is a strong one that what you're trying to do with certainly any company, at the end of the day, you've got this core set of values that have worked for you. And sometimes I think that— I mean, I was part of a public company that tried to keep that small head office, the same small head office in London, as they scaled 3, 4, 5, 6x, 10x. And they did, they managed to do that. And it kept a sort of core sort of feeling to the company that would have been more difficult if we'd spread it out. You know, it was kind of like, oh, we're still in Victoria Street. Yeah. And we're worth a billion instead of half a billion. Like, we're still, still the same team in Victoria Street. And I think there's a lot of tricks like that. I think there's a lot of— I mean, at the end of the day, large public companies that have grown by acquisition, they're really a set of smaller divisions. You know what I mean? It's like if you think about, I don't know, certainly at one time Pepsi, which was, say, $19 billion or something like that, it was 19 brands, a billion each. So it was— so even you can break everything down. I mean, it could be geographic, could be by division, but hanging on to those core values. I mean, in Massachusetts, I've spoken to Aaron Ain about this, who used to run Cronus, a big, big, big company that merged with a big UK company, and he retired. But he had such a strong culture through his work that, in simplified terms, to keep it human as it were, he definitely had a more complex system of HR than this. But the basic thing was binary. There was a scale of technical competence in a scale of kind of, pardon the French, asshole competence. And you could score really high on technical, you can imagine, 9 out of 10 with an accountant or a coder or, you know, marketing, who knows, but not so strong on the other scale. Well, in simple terms, you're not going to get promoted with a low score. In fact, you might not be around for a long time.
Well, that's not a bad thing, is it?
So that culture, I mean, keep it. So I think the key is that with entrepreneurs, I do, I do think there's a tendency to overcomplicate things. And I think if you've got a couple of— like, it's no point having 25 core values, right? You know, you can never remember the first 10 of them. But having a couple of— I know you're very strong in this— these couple of core values that really mean something to you. You know, I think that we've talked about this as well, that people definitely have pain and rations quite high, but whether it's Dan Pink or anyone else who's written about this in terms of social sciences, it's never— it's rarely the number 1 or number 2 or number 3. There are things ahead of that, right? And as you build an organization, whether it's organically and by acquisition, if you recognize that people, you know, want to get better at what they do and they want some freedom to— within— don't forget about them, please give me a manager, but give me some freedom. And by the way, I'd quite like a purpose. So I was speaking to someone, an entrepreneur yesterday. We're talking about maybe going on the acquisition trail. And it's to do with the— they're a big, big private company manufacturing, amongst many things, military hats and various helmets for protection. And you can imagine the purpose of saving someone's life by wearing that helmet. I mean, they've had families thank the product designers. For making those helmets as robust as they have. I mean, right. I mean, I, I build helmets. No, you don't. You've saved lives.
No, I'm so glad you said that. That's, that's a huge connection. That, that's one of the questions I ask all the time when I'm speaking. I said, what do you guys do? And yeah, sometimes you'll hear technical things like, I sell houses or I make, I make helmets. No, no, no, no, no, no. You're going to think about this for a while. What do you really do? And like you said, this particular company saves people's lives. And that's— yeah, it's crucial to look at that. Yeah. As valuable as the line item dollar and cents items from your estimation. And how do you present that in a certain context?
Yeah, I think there's a consequence. I actually think that, you know, my old boss in Thomson's, he was a genius and I was young, so I was sponging up every word he said. And not everyone has that. I worry my daughters are in their 30s. I mean, I worry that they have got access to the kind of mentoring I had in my 20s and 30s, you know? Yeah. You know, I do worry about that. I mean, I think they seem very focused and very smart, and they have got some great— they actually have got very, very good people around them. So I'm very, very pleased for them. But when I was in Thomson, my boss used to say, you know, you know, at the end of the day, when people are having fun, they can make more money. And this, this having fun, not in a clown way, not in that kind of like, right, more jokes, enjoy it, enjoyment, right? Enjoy each other. And, you know, I know there's a lot written about, you know, it's part of a family. I do, I do tend to lean on the be careful on that analogy of metaphor of families. Like, yeah, I think, I think one can be, have friendships and work together to deliver a cause. But at the end of the day, you know, you're in business to make money and you're in business to charm and enlighten and improve people's lives, i.e., customers. And there's no doubt about that, but I think that measuring margins is as important obviously as measuring happiness. I mean, I think that I've got a very good friend who's been in the CX, the customer experience, the NPS, you know, world forever and ever, and you know, so often that customer scorecard was never really reaching the C-suite, and yet the consequences of that connection being weak were huge. Like, you know, NPS is a good example. Everyone wants a 9 or a 10. Why? Well, because, well, 7 is pretty good. No, it's not. You know, and I'm not praising NPS, Net Promoter Score, as a particular system, but I'm just saying that in that framework, a 7, I mean, a 2 or a 3, people hate you, right? I mean, you really got a problem with the 2s and 3s and 1s.
I mean, except we can all be there on any given day. That's the thing. Yeah.
You just hope they don't know where you live. I mean, but the 6s and 7s, they are not— they are silently unhappy and they are probably going to look— you're going to lose that revenue. So if you could say to the CFO, hey, there's $4 million at risk here in terms of the revenue, I'm like, okay, I've now got like— I've just dropped everything on my desk. Now I'm listening to what you're saying. So I think that the key is that the human side and the organizational side I think they have to be symbiotic and so often they're not. There's a disconnect.
Yeah. No, well, you just hit a key point. Like there are so many situations. We definitely, this comes up in workshops all the time where if there's not that culture of true trust that we were always talking about, then a problem like that, I mean, that was a big one you just described. It may have started off very small, you know, right? People just didn't feel comfortable. They didn't want to rock the boat. They didn't want to get yelled at. They didn't want to get fingers waved in their faces. So, they don't trust enough to bring those issues to you, right? When they're smaller. And then, when they're big, oh my God, then you end up with that state of war sometimes in an organization, right? People pointing fingers, blaming each other, figuring. And then, yeah, fantastic.
Yeah, there's so much noise like that in companies that whether it's $10 million revenue or a billion revenue or bigger, it's so clear to me that There is a way of being tough love with people to make them better. You know, in the end, they feel you— never in public, you know, private, private sort of, you know, like mentoring. I mean, I've been quite tough with people over the years. Some people would say too tough, but I've been, I've been tough, but they've taken it because they know I'm coming at it from a very, very good place.
Like, I know they know you care. I mean, that's the thing. One of the key strategies we're always preaching is tough yet compassionate. And when I say that, people say, well, why Why did you put the word tough first? I said, because you have to be tough to be truly compassionate, because otherwise you're just going to be wishy-washy, and people will see through that and they won't respect you. And you'll coddle the weak folks. You won't have the strength to confront the weaker members of your team for whatever reason. That might be performance, it might be behavior. But anyway, yeah.
And you're not doing them any favors, by the way.
No, no, no, no. You're doing a lot of damage, right?
Not doing anyone any favors. When I got into investment banking the first time, very, very long, long time ago, it was a one-man band. He was brilliant. He was a brilliant, brilliant investment banker, brilliant public speaker, and he was fine. He was happy. He was part of a practice that had some, you know, a big accounting practice, had some shares. And so he had a building, he had people to go to, but he was basically on his own with one PA. And that's why he loved that. But he hadn't built anything. And when I came along, I was young and I wanted to get into investment banking. So the happy ending was we built a nice investment bank together, like 20 people, 25 people. But he was tough. I mean, he was bordering on being rude. But it was always— I always could see the bigger goal. And I think he taught me to be a better boss than he was to me. But he was good at the right things. And he was the most generous man as well. It was a strange kind of like— In the end, it was a great result for me. It was just not for everyone. I mean, but right, right, right, right. Back a little bit. You have to be that, you know, you can dial it back. I mean, I know there are some sales managers that people say, I wish they were, you know, even more human, humane about it all. And I get that. So this is not easy stuff. It's, you know, well, I was very—
and it's very individual. Like I said, I hate to overuse— this word is overused, authentic, but in its truest application, if you're not authentic, right, then they're going to respect you more. And like you said, sometimes we've all had people in our lives that are a little too— any of us, because it's a continuum, isn't it? We all fall differently on the scale, but I think, you know, we've all had people in our lives who were a little rough around the edges from our perspective that were truly, truly remarkable leaders. And like you said, sometimes behind that, I don't want to say it's a veneer, because if that's how somebody is, it's that's how they are. And but somehow hiding behind that, that tough exterior is sometimes the most generous, kind, caring person. And so it's, it's not right to dismiss them just on, on what the socially acceptable protocol is at any given time, because we've just lived through several years where that socially accepted protocol went way too far and caused a lot of damage.
Well, the other way to look at it is that we, we talk about the, you know, so, so there's a situation where one is, is perhaps a disciplinary type situation, or maybe it'd be a praising situation where they're really doing well. I mean, it could be also— but the reality is that situation didn't arrive out of a vacuum, out of midair. It arrived as a consequence of a set of events. So for example, people talk a lot about, and still do, job specifications. And I say, yeah, that, that's fine, but what about calling it a performance profile instead? So what's the difference? Well, a performance profile takes the jugular of the job specification because you want to be clear, but it gives a very clear indication to the recipient of the performance levels expected. And it can be 3 or 4, you know, and that's for salespeople. No, no, you can have an HR manager with performance expectations. You can have, you know, an AI whatever sort of developer of Agentic Systems performance profile. In other words, if you don't have that, there's a danger you're going to get to a place where they go, well, I didn't know that was like a level you wanted me to get.
If I had a dollar for every time I've heard that in a workshop.
Exactly. It's like, yeah, you must have known. Well, why would I have known? Well, I've spelled— well, well, I must have told you. No, no.
You know what? And I'm going to say this in the kindest way I can. And because I could easily be on the other end of this. I can see myself telling me the same thing. We've got to assume that people are a bit ignorant. I mean, because we all are. We can all be a little bit obtuse. We can all be ignorant. And it's not necessarily anything, you know, nefarious. It's just that we're all wrapped up in what we have to be concerned with every day. And let's face it, I have to be concerned about me. You have to be concerned about you. It takes some effort to step outside that when we're working on a team. That's necessary. It's part of our skill set, but it should be. But yeah, it's important. So as leaders, I think it's important that we help. We don't always have to set them. That's the thing I'll push back on. Some people, the leader has to set these, like you said, the parameters for a performance, right? But no, I mean, you could do that collaborative. You could do that cooperatively and you can allow that to be living, living, growing document, right? That grows as the needs change.
Yeah. Well, the performance profiles, certainly that I've put together—
Profile, that's the word you're using. Yeah, I love that profile.
It's definitely been— if I did it recently in the education-related sector where there wasn't really that many job specs. So instead of just trying to do more job specs, we revamped it into performance profiles. But it was a discussion document. I mean, it was very much— yeah. And you get somebody, say, in customer support, who knows those are games to say, look, Ian, it's not really realistic that I say, okay, that's fair. Well, what would be more— well, I mean, I know you want to stretch me, but I think this metric would be a better, a fairer metric. Okay, I'll live with that. You know, in other words, you've got to be a bit— you've got to be seen to be— I mean, why wouldn't I? Now, it depends on the personalities. You'd imagine, you mentioned that diagram of the salesman. You know, I think that quarter's a bit on the high side, Jim. I think it should be 50% less than that. Yes. No, no, no. Off you go.
Right. Exactly. That's where the tough love comes back in.
Yeah. I mean, so, you know, obviously I would say debate it, but anyway, that's—
but I know, but most of the time, don't you find most of the time people aren't— I don't know. Call me Pollyannish, but in my experience, when you have a clear conversation like that, right, people usually aren't trying to get out of work. They're not. Not generally lazy. I mean, if that's the case, then yeah, then the solution is simple. Just you're going to part ways. But I think most of the time people are going to— I've found that if I give people the benefit of the doubt, they actually choose to work harder than I was going to require them to work.
Oh, 1,000%. I think there was a time in certainly my career where I was— there was definitely some lazy genes around the place. You know, there was definitely people who You know, and obviously there is with every—
yeah, with all people. I mean, of course, the current disengagement figures bear that out.
But I think there's less places to hide for these people now. I mean, I think that— I think, and certainly that the obviously the most recent phenomenon, which has got a long, long way to play out, obviously the AI side of things. I mean, I'm using AI daily in certainly the acquisition process, but really, certainly I'm using it at this first stage as a super catalyst for my work. You know, it's actually my work quicker and more efficient as long as there's a human in the loop. You know, in other words, I'm looking at the results and going, hmm, yeah, not quite right there. And there's a few people saying that, journalists saying that recently, that is that, you know, it's actually amazing to be an experienced exec with AI coming along, funny enough, because we have got the reasonableness check in our brain that a younger exec doesn't have that reasonableness check. So I do worry that they are believing the AI output in a way that we wouldn't because we're like, right, accepting it without any skepticism and without sort of fact-checking it, right? That's right. That editor's view. No, it's not easy. But I think, I mean, there was something came out the other day there and the AI agent was telling me it was actually more about the clear next steps. Now the analysis was strong. The clear next steps were crap. Yeah, yeah. I would tell them about those next steps. I'm like, nah, that's not how you do it. No, I mean, the analysis wasn't very helpful. I mean, the analysis to make better decisions is excellent, you know, really is. I mean, I mean, frankly, when you do analysis as a human being, you go and try and do your analysis, you go and look places, it's quite tiring work, you know, you like, and you can only do so much in so much time, right? That's exactly, especially on the acquisition side, you've got this, you've got this time pressure. And so it's been a massive fill-up to many parts of that acquisition process. But I understand entrepreneurs who are wondering at the moment about all these things and how AI fits in. And I would say you've got plenty of time. Plenty of time.
I'm glad you said that because it seems like people are putting the brakes on a little bit more now. First of all, we realize that AI can be pretty dumb. Why would you just say that? Right. And it's funny because I was having an argument with somebody over this. They were saying, 'The AI lies.' I said, 'Well, not really.' I said, 'I've talked to some of the AI my Pioneers is it's not that it's lying, it's, it's designed to try to please you. I said that's one of the things that— right, one of the bugs they're trying to work out now, right? But it's just the way it is, and it was designed to try to help you. And let's say, let's be honest, from a commercial point of view, all these companies are competing, so they're trying to design systems that we want to be more engaged with and spend more time with. So generally, we'd rather hear it tell us how great we are than how much we suck, right? I've got mine trained the other direction, now. It tells me when I suck. So yeah, I think that, you know, fear of being left out is kind of passing a little bit. But I'm really more interested in the leaders who are saying, look, this is a powerful tool. It's growing more powerful every day. Everything we just said could be outdated by the time this airs next week.
That's true.
The killer robots could be here. We don't know because the pioneers have told me that The biggest surprise they've had is the rate of acceleration. So I think we need to brace for that as leaders, but also it's up to us, damn it. We're the ones who decide how we use this stuff. And I think that's what people lost sight of. They just were so in fear of being left behind, right? That they were grabbing every, everything, every implementation they could. And that's certainly not a good thing.
Yeah, absolutely. I mean, entrepreneurs are very much still in control. I mean, at the end of the day, So I've got a simple—
so far. That's the disclaimer. As of the date of this conversation, right?
Yeah. This is being recorded on May the— I sometimes even read blog posts or something I've written and I'm like, I'm not so sure I believe that anymore. I mean, there's Martin Blackwell, just did his His revision of The Tipping Point, Revenge of the Tipping Point. I love The Tipping Point. I mean, everyone did. I mean, it's a great, great book. And I've just nearly finished the— it was 2024, The Revenge came out. And it's some new case studies. But he, you know, it makes you really think about why something happens. Like, you know, do you understand the kind of— you've got so many judgments and biases. Have you I really stood back and looked at things. I love somebody who does that. You know, it's counterintuitive. And I think that in business we need to steel ourselves a little bit from making things too complicated. I mean, and I like, you know, Malcolm Gladwell will look at something and he'll look for the pattern of why it tipped. You know, why did you know what? He looked at COVID again. It was quite interesting, the analysis he did within the COVID phenomenon. And there were some surprising conclusions in the book. I'm on no commission, but I would recommend reading the book. But I would say that in my world, I've, I've boiled it down to 3 columns for entrepreneurs. I think there are 3 vital columns that every problem falls into, sometimes all 3, and that is strategy. I mean, there's no question that whether AI or not, being very clear on your positioning and your company's positioning. You know, Seth Godin said a great— well, a version of Seth Godin, who's a great marketeer, said you're either invisible or you're remarkable. And I think there's an element of truth in that in private companies. People think there's a big spectrum. I don't think there's that. I think there's companies that really are remarkable in their space. They've found a superpower, maybe not unique but remarkable, and there's a lot of me-tos that are getting by. And I think that strategy is so— the positioning playbook is a country mile above everything else. Like, if you define who you are and what you are, I think then it makes execution, the middle column, so much easier because you're really confident of what you are and who you are. There's a lot with the execution, but then people get confused what I would call governance. Governance is a third column. It's not in the middle of execution. So, well, what do you mean, Ian? Well, sales team, okay, it's execution, sure. You go out there, you build a great sales team, a great sales force, great. What's the governance part? The governance part is the sales commission. It's not execution. You're defining, first of all, you're defining roles and expectations and reward systems.
So this is, so this is actually the management part. If we're dividing leadership and management, now you're talking about the management side of things.
Exactly. And they're inter— they're symbiotic.
Right, right.
I'm failing because of execution. Well, are you? Let's examine that. I've looked at 1,000 sales commission structures. That is an unusual one. Oh. You think, yeah, I've never seen— why did you think that would motivate the sales team? So the problem isn't even the sales process, it's your commission structure. I simplified to make the point, right? So that's a governance point. Or your customer support person has got a sales target. No wonder they're confused. So your roles are woolly and weak, or the production director doesn't know He— why the quality manager is on the same level as the quality manager needs to report to production director. Like, why have you split those? Like, it could be a role, you know, governance issue. So the rubber hits the road and the product's not selling as well. Well, maybe it's a strategic— maybe it's the strategic product roadmap problem. So underneath strategy, you've got product strategy, you've got people strategy, and you've got all sorts of strategy underneath the big strategy. So I think that Malcolm Gladwell running something to ground of why it happened, like, are we actually seeing why this happened? And I think, you know, entrepreneurs, I think they get good instinctively as they grow their business. But there comes a point of scale where they really have to back up, have a more formal structure. So, yeah, so that lesser beings—
that's why, that's why I'm not going to scale by By the way, I've recognized my weakness. If I was going to scale, I would have to hire you or somebody like you to just come in and say, now you do that part, right? Yeah. But it's interesting you mentioned Seth Godin again because Seth Godin in a recent interview, he raised that question that I asked you earlier. He said, you know, you really have, especially in this day and age because we'll be able to do more with with fewer people or amplify the power of the people we have with the technology. So the question was, should you scale and what are you going to lose by that? You know, or are you doing like, you know, you mentioned the superpowers, right? Are you employing your superpowers the best? And, you know, I love what you said about being the best or declaring the best. We went again, we went through that. I'm thinking back to the martial arts schools. One of— we had a business meeting one time with the center directors and I was telling those guys, "You know, you guys are the best. You guys are the best around here. You provide the best service. You provide the most personal service." And one of the guys said, "Well, I can't go around saying I'm the best." I said, "Because there's other good guys around here." I said, "I know. They're my friends too." And I said, "I don't even consider them competitors really." I said, "But I'm just saying you guys are the best. They're probably saying the same thing. If we're all doing that, everything's going to work out fine." It's not about killing each other. It's about each of us being our best, right?
Yeah. And some people say, you know, you learn more looking at your customers and some say you learn more looking at competitors and everyone's got a school of thought.
I see something from both, right?
Yeah, I really do. I mean, and certainly there's a lot of, there's a lot of logic that doesn't work in business sometimes, like go and speak to your customers. They'll tell you what to build next. That could be a horrible idea. I've, we've I've been— I've run something.
Yeah, no, no, yes. Oh man, you just hit it right out of the park because I was just going to say too, there was, um, Jimmy Yong, who was Dr. Yong from Boston there. His son became the Secretary of Commerce in Virginia, and he and I spoke at the same event, and it was a martial arts event ironically. And he, he insulted these guys by saying martial arts had become commoditized. And, and right, he had made, made his point. It was was well received. And then afterwards, when I followed him, I said, he's right. I said, he's right. There's nothing special about— if you listen to always to— I'm going to reframe it now, because if we listen always to what our customers wanted at the time, or what they were telling us that they wanted, we know what they wanted and what they were telling us was actually two different things. They wanted a cheap place to put their kids for an hour after school, and the cheapest was that. And I said, no, that's not they want. They want a life-changing experience for their kids. They want all these other things now because it's become commoditized. And that's why I'm kind of tying this back to scaling again, because it became so readily available and people started to compete on price, which is what a lot of customers were saying. That was really degrading the entire product, if you want to call it that, system, industry-wide, right? And that's why martial artists— martial arts became so commercialized. When people say, why did it become so commercialized? Because that's what people wanted, or that's what they said they wanted. You got exactly what you wanted. So anyway, I hope that didn't go off too far on a tangent, but it seems to reinforce what you're saying.
It's all underneath this, the difficulties of scaling. And I think you can break it down. I mean, within that strategy, you know, execution and governance. So even within strategy, you've got all your sales and marketing and production and all the rest of it. But again, it's actually when you pull back the covers, even taking sort of sales as an individual sort of skill set. Again, it's amazing that we haven't— you know, as a generality, there's a danger that people still regard sales as to do with selling stuff.
Oh, oh yeah, yeah.
Nothing to do with selling stuff.
Like, fastest way to turn people off now, most of the time.
It was always about, always about questioning to understand how you prove that particular prospect's life. And, and I mean Bill the prospect, I don't mean IBM, I mean the actual quality manager Bill, who you think you've got a product to solve some of his problems or enhance his life. Again, to get to that, and this is very similar, there's a lot of similarities between a good practice acquirer and an M&A process and a good sales professional because both are very, very good at doing something special— asking the right questions. Mm. You know, the asking— and it was a great— where True Detective, where Foster was playing the lead role, and she— that was the great line she came out with that they had written, and And they said, no, we're just— we've no idea who did this. Like, middle of Alaska or something, Iceland or something. I know, it was like cold. And she turned to the number 2 and she said, now you're asking the wrong questions. And it's so true. Like, you'll never solve anything by asking the wrong questions. And so salespeople, that's a salesman. But it's— I'm on the acquisition trail and I need to be very careful what questions I ask because I need to extract enough information to perceive the value of this company.
Right, right. And they can't, right? It's interesting because you want to get information. But if your questions are perceived as leading or manipulative, then you've lost it too, right? They have to be sincere questions that are getting both parties to the right place. But yeah, you know, again, you hit it out of the park because one of the things we preach all the time is leaders are not the people that have all the answers. And I'm not talking about leaders in, in, in a managerial hierarchy. I don't care if you're a frontline salesperson, I don't care if you're sweeping the floors. And I say that with pride because I did that plenty. But, um, right, but leadership is that quality of, of, you know, being able to influence the people around you, being able to inspire and empower other people around you. And when you're in sales in particular, what are you doing? Well, If you're a competent salesperson, if you're a success, and all the best salespeople I've ever met fill this bill. They inspire people, they touch their hearts, not just their heads. They empower them, they give them tools, right? They give them something that they need, and they guide them through the process, right? Hopefully with warmth and sincerity. So—
Another thing is they're really good at getting off the stage if they can't help.
Yeah, exactly, right? Yeah. Stephen Covey famously said win-win or no deal, right? And that's a powerful— that's not an awful thing to say. That's a powerful thing to say. Walk away.
Well, it's so real and so truthful and so fucking do it that you— and of course, the bonus points come if you can say, well, I can't help you, but hey, I know somebody who can help you. At least it'd be worth a Zoom call or a coffee with them. That is gold dust. Now, is it a possibility that you'll be able to help them on something else at a later date? Sure there is, but don't waste their time. Because I, and I think the, you know, really, I mean, chipsticks and knowing your product as a salesman, right? If you don't know your product, what the hell are you even playing for? But the more advanced thinking is that you really are, and this is where AI can help the prep but can't help the result, which is the relationship building. So I think as an example of where AI can fit into any business cycle, certainly it can help. There's no excuse for not being super prepared. I mean, none at all. I mean, I had a prospect meeting yesterday on the acquisition side of things. He said a couple of things that we were looking at in terms of sectors and, you know, It was to do with injection molding and one or two other, you know, manufacturing type areas. I had used my AI engine, prompted it the right way. I wasn't going to give him all the names, obviously, it was a prospect meeting, but I was able to highlight 5 or 6 companies. In fact, there was 3,915 companies that fit. Now he's like, how the hell did you know this? And this was just northeast of the US. It was a very good— like, that made that conversation— well, it was meant to be a 45-minute intro. I had to get him off the phone after 1 hour 20 minutes.
You know, and again, that's so cool, that story, because now, you know, if one of the signs— geez, I'm going to go on a rant here, but I get deluded through these LinkedIn things, you know, like I see somebody, I admit I don't check very carefully when someone wants to connect with me on LinkedIn, I take a quick look. And sometimes I hold my breath, say, "Oh, I'll give him a chance, but I know what's coming." And then you get that generic pitch, you know. One that I got the other day was, well, I'll tell you two, because the first one that came in this week was, "Have you ever considered charging a fee for speaking?" I said, "I think I have considered that." And then the other one was, have you ever thought about transforming your expertise into a book? And I wanted to be nasty. I wanted to just send them my Amazon page and say, look, the least you can do is the least you can do. And when you're talking about what you just did, I think that's brilliant because as we move into this AI age and people know that it takes very little time, I'm not talking about effort because effort It's a different thing. Because for you, I think you're the same way I am. Probably that list got you very curious, and you're probably going to go there and learn more about those other companies in that process, right? And that's all cool. It opens our heads to more things. But people know that it doesn't take much time for you to do a little bit of work, a little bit of background. And so when you don't do that, you're just marking yourself as a dub, you know.
They don't really they don't really care how long it took. It's the thought that counts.
Yes, the effort that you made. At least look at my LinkedIn profile, for Christ's sake.
Show me some respect. Like, I find that, yeah, I mean, in a very focused way, I'm coaching and helping people on both getting ready for sale and on the acquisition trail. But you think about the first appearance. As an acquirer and I'm meeting the seller, and that is, that is a, that is a Super Bowl event. That is a big, unreasonably important event. You will have many dances with the seller if they want to do that. But that first event is, it's just underwhelming for most sellers. It's like, really? It's not probably as bad as, I've got a great idea, Jim, you could do a book. That would be— that's borderline offensive. But it's— you know what? But I do think that there is— you really— you've had a runway. The seller's not up for sale, so it's a sweetheart cold call kind of introduction. But you've got the runway. I mean, you know, some of the best speeches you've heard on TED Talks, etc.. I remember one woman, brilliant speech, 25 minutes, whatever it was, and they asked her, so how long did it take to prepare for this speech? And you can imagine the answer, they were expecting weeks, and she said, about 2 years. She said, no, no, no, I'm not being funny, it was 2 years because I've done the pub circuit, as it were, you know, I've done the small events, I've done all that, but also the words, I've rehearsed those words and tried those words out over, over, you know, last 18 months. And this was the culmination really of it coming together. So, you've no idea.
Oh, well, not only that. Not only that. I mean, like you're talking about, you know, you arrange your first meeting with somebody that you're going to talk about either a sale or an acquisition, right? And the work that you put in behind it.
Right.
You know, I'd rather talk about you than me. But real quick to share my own experience just for the perspective. I remember being challenged by somebody about rates one time for speaking, right? And the thing was, geez, you got paid that much for an hour? You know, I think at the time I just passed $10,000 or something. So you get $10,000 for an hour? I said, no, that you're paying for the 45 years of misery, heartache, and mistakes that I made. Well, I said, that's what it is. And you, and you know, in your work, you're bringing bringing exactly that to the table. It's not the little bit of prep. I'm not just discounting it, but even if you took a month to prepare for that meeting, that's small in comparison with the years and years of experience that you have, right?
Yeah.
The triumph you've had, the mistakes that you've had, that all are part of your domain knowledge, right? And too many people— there's the other danger. Too many people now— there's cycles of this. This has happened before, but now it's AI is the catalyst that, you know, you can learn a little bit about a lot of stuff really quickly. Information is cheaper than it's ever been, right? But to be able to apply that, interpret that information, to bring the wisdom and the awareness to it, that's a whole— you cannot substitute the experiences that you have.
Well, and I think also to that point about pricing and being commoditized and that sort of thing, I mean, what AI is bringing to to the party as well is this would be a real test for lawyers, I think. Right. You'll have to learn how to sell value pretty quickly because, yeah, I mean, the little black, you know, the cloak going to be pulled, the curtain's going to be pulled back and the hours they're putting in, you know, you could definitely turn those hours down a notch. By applying a review period to the AI answer. Now, clearly many law practices are embedding AI and they've got massive guardrails. Some haven't got the guardrails in place they should have, and therefore you're seeing—
correct.
It's like, so we don't recognize that case study you're citing. No, well, I certainly didn't make it up. Or maybe I did make it up.
If AI is telling you to use that sovereign citizen angle. No, it's just telling you what you wanted to hear. Don't do it.
Plane crash in China.
No, there wasn't.
Well, there may have been. No, there wasn't. But going back to that point of preparation, I mean, one very specific thing, again, C-suite, if they're senior people listening in, one of the big flaws people get wrong is on that acquisition thing, is this integration thinking. Like, they're thinking about how they'll run the business way too late in the process. It's just a little vignette of a problem. You say, well, what do you mean? Well, again, you're meeting the seller for the first time. The seller is in his or her rights to say, hey, Iain, just, you know, I know we've talked about, you know, the business generally, and you've been kind and shared details about your own business as an acquirer, which I find very helpful. So just, you know, ballpark for me, how would you run the business in your group? And the answer isn't, Jim will answer that, or I haven't a bloody clue, but I'm going to think about it— bad answer. So you have to be able to have said, you know, we have given this some thought, and 'You know, you dominate New England. We're on the edges of it. We're big in Chicago, we're big in the West Coast. So here's how we see it. Now we need to talk it through with you and you're going to help shape that, but here's our initial thinking.' Great answer. That's more like it. You've given it some thought, you've looked into my business, you've looked into your own business. Or it might be even more extreme. It might be a UK acquisition. You say, 'We're not in Europe.' 'You're our platform to Europe.' Another good answer. The fact is, that is something that should be part of your, your, your filtering of targets— the ease of integration. People are still doing it in due diligence. Oh, how do we actually run this business?
I like what you just said there. And the question is, is that— man, it's so tempting, and it's getting even more tempting. Again, here's where tech, not just AI, but technology in over the last few years has caused this phenomena that it's easier to take a shotgun approach now. And some— in some cases you can also blow a lot of money doing this, but in some cases it's a little more economical too. So how important— that filtering process, it seems like, is, is critical. But not, not just if you're, you know, doing a, you know, multi-million dollar deal. It's also critical for for any of us, right?
Yeah, well, and what you're doing with a filtering process and having a process, you're forcing the alignment back to why you're doing it in the first place. So, you're constantly saying—
So, it's more personal there.
Yeah, exactly. Well, you had an original— I mean, it could be a recruitment project, it could be an ERP system you're buying, it could be an acquisition target. But you had a strategy. And how often are we going back and confirming, does that actually align with why we're doing this? Because if you let it go too far down the line, that comparison is too late. It's like almost, oh well, you know, maybe, well, you start compromising, put it that way. And it's good enough. And in fact, it's not good enough.
Yeah, yeah, yeah.
I mean, so, you know, like it's not really an HVAC supplier, 10% of its revenues HVAC is something else, but you're, you're kind of ignoring that fact. So I think that whether it's an acquisition type model or whether you are, you are developing a new product suite, are you staying in your lane? Like, are you staying loyal to your DNA? And often I see entrepreneurs straying out of their lane instead of being world-class at everything, they're not world-class at products C, D, and E. You know what I mean? They need to be better reinvesting in their A's and B's.
There's the Apple story in a nutshell, right?
Yeah, exactly. So there's all sorts of— so I guess that positioning and execution and strategy and governance stuff, I think that what AI is able to do is, is access so much more data to make better decisions. But it still comes down to you will never have all the facts. That's the reality. You will never have all the facts to make those decisions, especially as they come at you from a daily basis. But you can definitely embed AI into some of your processes to make decisions better. Whether you go the full hog, as it were, and now we're moving into things like employees being AI, you know, agentic AI. Yeah, that's another level. And it's happening. I mean, there are employees that are AI agents. I mean, that's what they are. They've got a job title, they've got a performance.
I use Marbalism and that they set it up that way because it just makes it easier for us to interact, right? But you know what, I want to be respectful of your time too. We've Obviously, I've got a list of 10 more things we've got to cover in future conversations, but there's something that's been bugging me for a while that I wanted your perspective on.
Yes, yes.
I think it's very valuable, especially based on what you just said. There's times when I'll go to talk with a company or start working with a company, and they'll push back a little bit on more tangible metrics than some of the human stuff we can talk about, which can be measured, by the way. It's just, it's a lot more expensive and a lot, a lot harder to do. But, but at any rate, and sometimes somebody said, why, why don't you think our particular culture is working? Why do you think command and control doesn't work as well anymore? We're successful, we're profitable. And of course, you're dealing, I'm sure, with companies all the time that have that mindset. Whether they're buying or selling. We're profitable. Well, the metric I go to usually is I say, show me your churn rate. I want to see how long people are staying here. Am I way off base or is that a reliable metric that says, you know, if something's not drastically wrong, there's something else that needs to be looked into. How sustainable is this? Because to me, if you're not keeping your people, you know, you're on life support. And unfortunately, it can take a couple generations. Well, you're a UK guy, so So, you know, you could take 100 years for a company to die, right? Now it's dying the whole time.
Yeah. I mean, churn rate is— I mean, you could be in a very narrow sector where there aren't many opportunities and people just can't leave because there aren't—
Yeah, you have to compare it to the other.
It's all in context. Is it an important measurement no matter what sector you're in? Of course, it has to be an important measure. I think as well, The investment that's needed, whatever structure, command and control or more disparate kind of structure you're operating, I think that I still see a lack of investment in detailed exit interviews. You know, like really understanding why someone is moving on. And I think we get a lot of glib answers that don't feel real to me. You know, like, yeah, well, you weren't paying enough. Really? That was the real reason? You know, getting behind the reasons. And, and that can sometimes, you know, you can develop a pattern of interesting data there where there's maybe an issue in a department, of course. And that's the other thing, of course, as you will know, that there's cultures. You'd like to think we have a great culture across every single department, every single area. Often there is a department that is not such a good culture. You could be any space. It could be just recognizing that's important. And so measuring, trying to measure not just a global or corporate culture but a departmental culture. Sometimes you can have somebody who's achieving results and underneath that there's an unhappiness, but you don't really see it. It's about— but I think one thing, one important point I haven't mentioned yet that I'm beginning to think more and more about with dashboards and the way people run businesses. I do think that we are so busy these days that I think it's more important than ever to have what I call triggers. Triggers that are automatically going to trigger when something happens and alert that person who's accountable for that trigger. Now triggers could be an order book, a bucket of orders that is draining like a leaky sort of five-hole bucket coming out because the new sales going in are a lot less than the invoicing going out. So that you're burning through that order book, you're not topping it up. And there can be triggers around that, book-to-bill or some other, you know, production-type ratio. And I think there are triggers throughout an organization that we need to elevate. They're meant to be key PIs, key being important, not PIs, you know, you can have lots of performance indicators, but the key ones should be spread across a company and should literally flash when they get triggered. Because I think we get locked into board meetings or ops meetings or other meetings, and it's like the triggers are there, but they're kind of like camouflaged, you know. And, you know, a number of times I've looked over the shoulder of a sales manager and say, you can, Frank, you can see what I can see here. Frank's like, yeah, all looks good to me.
Yeah, but you know what, it's funny, before we wrap up, I want to say this is because in getting to know you more and more, it's, I'm glad, you know, it's way too long when we hadn't talked.
Yeah, I'll let it go.
You know, to me, a lot of the reason you're able to interpret this And you've got a special gift where you can look at numbers and you're seeing beyond those numbers to the people because all those numbers are is a product of the effort, the work, and the dedication of the people that create them, right? I mean, that's just the way it is. The numbers aren't anything without— the numbers are some way for us to understand what our people are doing. Well, they're only the first one, right? And they're great, but you see beyond that. I wanted to make sure that I had somebody—
I think it's a lesson for not just junior finance people, but managers of all sorts. They need to get better at storytelling, right? So, so, so I could get a 6th grader to give me a trial balance with a balance sheet and a profit and loss account. Give me an hour and I'll teach them how to do that. I mean, they might not totally understand the total nuances of currency and double entry, but I'll give them enough so they'll produce— they'll give me the numbers. I know what the bloody numbers are. Tell me why. Tell me why and tell me what I can do in the future so those numbers don't happen again. And it's that why in the storytelling that we lack, and we need to train that. We need to get people really thinking that way, like they have to explain themselves. And that would be That would be a massive difference.
And not just ask AI to do that for you. You're missing the whole point, right?
If you do that, unless you're not going to get it right either. No, that's, that's, um, that would be my, and the, the other thing I would just close with just on the big value exits where we started the conversation. I, I, I thought about this for a little while and it, I love being able to boil it down to 7 or 8 words to simplify things. You know, you know me, I love a good phrase. And really, it's one point I would say to every entrepreneur, just remember this: value isn't created at exit, it's exposed. If you just let that sit in your head for a minute, you realize that it's too late. The bankers and the accountants can't make your company pretty. They can make sure the tax is minimized, but You're the one that has to actually polish the diamond, and if you don't polish it, it's a piece of coal. Mm-hmm. You need to think about that. You need to think about value is exposed, not created. And you can create it, don't get me wrong, and accelerate the value. That's the key. So whether you sell it or not— so that's— I just want to— those are the, those are things I'm trying to get across to entrepreneurs because I can only work with a handful at a time. So there's 6.2 million entrepreneurs running a payroll, so I can't get to all of those.
We're gonna try to help you do that.
That's what my mission is, to try and, you know, if it works, fantastic. But I'm a big sharer. I'm a big sharer on LinkedIn. My website is a big sharer. I'm just a big fan of sharing. People, oh, you're giving things away, and Come on, come on, it doesn't work like that.
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