Mike Michalowicz: The Business Owner's Secret Weapon

Okay, welcome everybody to a very special edition of the Boost Lee podcast. As always, we give host the tools, the tactics, the training and the confidence to get more direct bookings. And I've got a very special guest with me, Mr. Mike Michalowicz, author of so many books. But we're going to talk about the revised version of Clockwork today. So as we always do as we crack on with a Boostly podcast episode, let's get started with a lovely little freestyle wrap, shall we?

This is a freestyle going off the dumb. Ready for my close up.

Good looking, let me tell you. Get more bookings. Aw, that'd be nice. Giving me tips, tools and advice. Yeah, you're gonna get em hun. You're gonna sit back, listen to Mark Simpson. Whoa, having a blast. Gonna get it on the Bruce Lee podcast. Bruce Lee, like Bruce Lee. Cause it's so hard on the T is loose leaf making up those rhymes. Don't write it, just do it loosely. If you want my respect, you're better. Book direct. Here are the words in the podcast. That's what.

Here we go. I love that. I love how you have to say book direct and you get this additional fingers growing is it's there with the.

Ali G reference as well. So it's, it's all good. But thank you for doing this. Google tells me, Mr. Matt McCulloch, this is your 152nd guest podcast episode. So okay. You have done more than what most people put out in their entirety. So thank you so much for doing this.

Oh, this is my joy. Thanks so much for having me.

So we're talking today about the Clockwork book is revised and expanded. So I'm going to let you explain all about that in a second. But could you just very quickly just. I guess the best place to start is why did you feel like now was a good time to do a revised version of the very popular Clockwork book?

Yeah, I think part of it was because the growing popularity of Clockwork and then the realization that some people are reading the book and unable to successfully implement all the strategies without additional help. And that's not my intention. My intention is that when you read one of my books, everything I know is in there and it's executable without getting any assistance. I want a full package. But one of the challenges of writing a book the first time I wrote Clockwork is the only experiences I have implementing it are businesses I've personally coached or when my team members have coached, or our own companies, which implies that when they have questions, whatever you know, we're dynamically addressing it. But a book is a. It's a linear pitch. It's like, you know, here's line one, here's line two. Go do it like there. You can't ask questions, you can only reread. So I found that there were certain elements of the book that need to be rewritten. As a result, 60 of the book is brand new content. The framework is the same, but the way it's positioned in the way you can digest it, I think is, is a multiple easier to do. 40% of it is realigned. So I took parts that were working and people were able to absorb and move it around. The other stuff, I redone it to simplify, hopefully dramatically.

So one of the things that I noticed, and I've been very lucky to have like a little sneak preview at the new edition, is that you were talking to employees, not just employers. There's cool little love notes in chapters two and ten. Could you just sort of speak to the fact on why you decided to do this?

Yeah. So, so interesting is when the first version of Clockwork came out and I think calls from entrepreneurs, business owners that were implementing it, they said, I want my employees to do this. I say, great, share the book with them. They say, I can't. I can't share the book because it talks about how the entrepreneur runs the business. So there was this disconnect. And what I did with this version of Clockwork is at the end of every single chapter, there's a section exclusively for the employee and how to implement it. They have a choice. They can read the entire book and get that section. I encourage them to, or they don't have to. I also point out to the business owner is this is a look that they don't normally get. They understand how you're thinking. So many employees don't have an understanding because it's not provided to them. So they come to their own conclusions, which not often is right. Oh, the business owner just wants this business to be efficient so they can make lots of money and take advantage of me. But the reality is the business owner wants the business to be efficient so that they can employ more people, that the business can run more efficiently. That's a more stable business. And yeah, the owner, just like everyone, probably wants to take a break once in a while. So you start getting this perspective that I think is a little bit different and helps the employee. My hope is when someone reads the book, a business owner or a department head, okay, it's something I want to implement that. Now they're inspired to give each one of the employees a copy or rotate that one copy around but let everyone experience it so that they can participate in the success. That's my last component. Clockwork from from a leadership standpoint is about 10% it's the deployment of the system. 90% is people actually buying into and doing it. So I think they will benefit by reading it.

Well, I can personally speak to the fact that we had a new team member start boostly over the course of the last three weeks and one of the first things that I asked for her to do so hi. Irony is was that read the Clockwork book. You know, really buy into what we're trying to do here. So she has read it, loved it and I was not afraid in any way, shape or form to pass it to a. To a teamwork. We now have every one of our teamworkers read the book because it's. We're all on the same. The same.

I love that.

So yeah, it was. It was massive for us. So yeah, I'm a big fan. I've taken part on the. The training behind the scenes with Adrian and the team and.

Oh, she's great.

Yeah, we've. We've had an amazing time and Bruce Lee has massively benefit for it. And I feel like anybody that has read the first one will be familiar with. I feel like one of the biggest takeaways or biggest sort of people that remember the first one for is the QBR the Queen. And the. One of the features as well was the four Ds and this is something that I've always gone over is the four Ds and this time you've added in the fifth. Right. Could you please just for anybody who's not checked out Clockwork, the first book. Could you just quickly go over those four Ds and just add in the 50 that you've added in?

Yeah, for sure.

This was really interesting to me how it all sort of came together.

Yeah. And in reference to your first comment with the qbr the heart of the book, the heart of the concept that was probably the most that I re engaged in. I that was the most important yet also the most confusing. And I think I'm convinced now we have it so that anyone can implement it just by reading the book. But the. The 4D is now 50 became monumentally important because it gives us a perspective of how our business is operating. So here it is. The four Ds are the four different stages of involvement people can have with the Business, there's a doing phase. That's the first D that are the. That's the activities within the business that are necessary to provide the product or service to the client or the infrastructural support behind it. You sell T shirts, that's a doing activity. You make the T shirt, that's a doing activity. But it's the invoicing, all the infrastructure, all that's doing. It's all the necessary components so the customer can have the experience of purchasing, acquiring, and experiencing your product or service. That needs to be the majority of a business's activity. But it can't be the only activity. And it's usually the owner, the first one, who starts navigating through the other activities. So the next one up is called deciding. And deciding is a precarious and risky thing. It's necessary, but you only want to sit there for a short period of time. Deciding is the activity where you're making the decisions for the other people on your team about how to proceed. And this is necessary in a small business. But it can't last for long because what happens is, say, I make T shirts. It's just me. I make that first hire. They come on. I say, okay, here's how we make T shirts. Put in this press, put this ink on it. And now we have a design that we want to get out there. It's. The employee is likely to come to me and say, hey, I'm about to put the ink on. What color should we do? Should be blue or red. They say, oh, you know, the order was for red, so it should be red. Then they say, okay, how do you make red? Like, they come back with all these questions. At certain point, if the employee keeps asking questions, I've now restricted my ability to do anything except for answer those questions. And we see this play out statistically, the vast majority, I think, is about 95% of businesses globally have less than three employees. And the reason that's true is because the owner is making all the decisions for everybody else. They're simply assigning tasks and saying, when you're done, come back to me. Task, come back to me. And then the owner can't do any work themselves because all they're doing is task rabbiting all the time. So it's necessary for early stage employees, it's necessary in certain circumstances. But what we want to do the majority of time is what's called delegation. Sadly, we confuse designing. I'm sorry, deciding and delegation. We think we're delegating when we're actually deciding for others. Delegation is not the assignment of tasks, it's the assignment of outcomes. It's saying, okay, we need to print shirts that match this order. Do you agree with that? And why do you agree with that? Well, you know, these clients order this. There's an expectation that's been set. They're paying for this. We have to meet this order. It's a no brainer. Great. So we understand the outcome. Your job is to guess there. And any questions you have, I want you to use your brain on how to do it. Now what's going to happen is the employee comes in, says, hey, should be red or blue. And you say, well, what's your decision? The common response, by the way, is I don't know, that's a quick cop out. And then you say, well listen, I hired you for what's on that shoulder of yours, that brain of yours. What would you do if you did know? And you keep pushing the decision back to them. That's what delegation is, is where they're empowered to do decisions. Here's the thing, they're not going to make perfect decisions, nor did we growing our business. So when they come back and say, you know, I decided to do pink, you gotta say, okay, if you feel that's in the best interest of our clients, let's go do it. Even though you may say, oh, I wish they were doing red. And then they come back and sometimes they're gonna make decisions that are gonna be wrong, at least in your opinion. But at least you've empowered them to make decisions. They have control. That's a big way for people to take ownership over their roles. My only warning is as an owner of a business, as the mentor for employees, they're making a decision that harms the business significantly. Then you need to intercept and say, hey, you know, let's look at the order and see if you want to change your decision around doing pink. And they say, oh, it says red on the order. We should do red. Okay, good job. So you want to coach them through that. So delegation see assignment outcomes. Next level is called designing. At the highest level, designing is the, the vision for the business where we want to move it, and the choreograph or the organization of resources to get there. How do I move us all together to get to this outcome in a way that's successful and supportive of everybody? Design work is hard work. And for an organization, 10% of time should be spent designing, thinking of the future, envisioning. And if you're just the only owner of a business, the only employee in the business. 80% of the time you got to be doing rest time is dedicated to other three Ds. The business grows, more and more of your personal time is dedicated to it. But we always keep that balance. Majority of our time, 80% or more doing. But the 50 is downtime. And this was a revelation on actually the research came out of England of how people are productive and what they found is we're really good at sprinting, we're not good at those long eight hour days, particularly the knowledge workers. We found that the average knowledge worker produces for about 3.2 hours per day, regardless of the number of hours we work. So you could have an eight hour workday or a five hour workday and you're still producing the same amount. So we need to afford downtime. I'm not saying this is lunch breaks and so forth. It could be, but also you may just choose to hire staff that does downtime on their own. Over half our staff here is part time employees and they, they work for four or five hours a day and then the rest of time they experience downtime on their own. Whatever activities they choose to participate on at their homes or wherever. What we find is by compressing the work hours that people are still producing at three to four hours a day. So you don't need people on, quote, unquote, full time because they're not fully engaged. That's the importance of downtime.

So good. And I feel like the last couple of years and everything that's happened in the world, it's, it's sort of made a lot of people think, especially over here in the uk, like how business owners are running their business. Staff don't have to be in offices all of the time. You know, we are more than capable of doing the hybrid model. And so many people now on the school run and, and people that I, parents that I chat to, I think everything has changed over the last couple years. So it's really interesting to see it. And that study coming out of England is, is interesting too.

So yeah, the UK is really on the forefront of this, I believe. Another article broke recently that in the UK there was a mandate for 3,000 companies. It's a grand experiment that they moved to a four day work week to see how people are engaging. And so thanks uk because I think this is gonna become a global phenomenon as they do their research. We on our own accord actually implemented that strategy ourselves too. And we started it two years ago or maybe three now that we're closed On Fridays, like no one's expected to work on Friday. What we found is it's morphing into. Is everyone has a set of expectations to produce a project over a certain period of time, a week or a month or a day. Everyone has expectations of what to deliver. They're given the flexibility to find the schedule that supports them. And we still have this rhythm of saying every Monday, Tuesday, Wednesday, Thursday, we are going to meet face to face or virtually just to reconnect. So we're still in this rhythm. It's not everyone's on their own, but we're offering more freedom. And it seems so far it's resulting in more productivity.

Talking about reconnecting offices, working a little bit differently, bringing it back to hospitality for a brief minute. What we're finding is people that have got larger properties, maybe they can sleep 12 to 20 people in a larger property. We're finding offices now, booking out places for a week because they're doing that, that reconnecting that you're talking about. So it's a. We're talking about hospitality, short term rentals. There's a whole new demographic of, of client now. And business guests are some of the best guests to have because as a fantastic way of having it repeated quarterly or annually. So, yeah, really interesting. So I want to move on to another part of the book that's being sort of revised slightly. The trim, trash transfer. And we've now added Treasure, another T. Right, Treasure, Right, we've added another T in which is Treasure. Yeah, T and D. So we've got. So yeah, please speak to that.

Yeah, yeah, of course, the fourth T, Treasure point points to that there's certain things we need to value in the work we do. It starts off with the first three T's. So in optimizing the roles of individuals within a company, the first thing we want to do is see is there anything that's trashable? Meaning is there anything that is not serving the business. As an example, we were doing a newsletter here that I was writing myself. Took me about four hours a month to write it. One month I just forgot to do it and not a single subscriber said, where's my newsletter? And then I like go another month. And no one said it. And I tested, I sent it and then the next month after I didn't do it again, and no one said boo. I was like, oh my gosh, four hours a month of wasted time. I was just doing it because historically we'd done it. There's no value being delivered and it's costing time. That's trashable. The next thing is. Not everything's trashable. Maybe a few historical things are the next thing, is it transferable? Meaning can we send work to someone as optimized to do that work or prefers to do that work? At least for me it was invoicing. I do. I did invoicing. I'm not necessarily good at it. I hate, actually don't like doing it. So I usually push off till the end of the day, a late hour. And I was tired and cranky and I had to get this out. It was necessary evil. Then I transferred to someone who said, my gosh, I love invoicing. I love the detail. I love seeing the health of our organization and tracking it. Like you love invoicing. Are you crazy? It's a necessary evil. They're like, it's a necessary joy. It's so much fun. One person's garbage is another person's treasure, right? Or one person's trash is another treasure, right? So that was a big realization. Can you transfer work away from what does not give you joy or you're not efficient and effective at to someone who gets joy at it and is efficient and effective? Next one. So that's trash, Sorry, trash trim. Last one is trash transfer. Last one's trim. Trim is where we take work that we must do, but see if we can find efficiencies in it. I lie with these one on one meetings here at the office to talk about projects and so forth. And we moved it to a group meeting, a morning huddle. It takes 10 minutes and something that was taking hours a week to transfer knowledge. Just by setting up one group meeting, we're able to bang it out really quickly and get the same results. That's a trim. So you don't remove the job. You structure in a new way where it moves more efficiently. And then the newest thing we added was treasure. And it came out of the book that I was getting emails from readers saying, I want clockwork for my business and I don't want to leave my business. Like I want something to do in my life. So I'm not going to do clockwork. I'm like, what? You're not going to do clockwork because you'll run yourself out of the job? They said, yeah. So I said, okay, here's the reality. You want to run yourself out of a job because you can then reinsert yourself in the way that gives you joy. So if the business doesn't need you, then you get a cherry pick what you Got to do. And that's the best part of being a shareholder of a business. Do what you want. I did it for myself. I've been doing clockwork now. I think I'm on my fifth year. I take a annual four week vacation. Actually last year I took a nine week vacation, an annual vacation from the business to prove the business can run itself. And I've selected what I like to do. And there's two things I love to do. Being a spokesperson, kind of what we're doing now. I love talking about this stuff. Secondly, being an author, just writing about it. So those two components is what now represents almost all my time in the business. I do other things because sometimes it's necessary. It's not transferable. But those are the things I treasure and are prioritized.

Love it. You very quickly mentioned shareholder. This is something that I've picked up from knocking in. Yeah, snuck it in. I like that. It's something I've noticed over the last like seven months that I've been doing the run like clockwork program. You mentioned it on one of the videos, one of the live videos. Can you just sort of talk to shareholder? Because I admit I've tried this at a party or meeting up with parents. Hard right time. So hard. Can you just explain how you describe it and speak to it and just sort of explain how other people can adopt it as well? Because it's fascinating. So hard. But can you just.

Yeah, so hard. But it plays into human psychology. It is the human propensity to comply with how we identify. So when we label ourselves as something, we will start acting consistently with it to prove that label. True. I'm horrible at math. I won't study, I won't prepare. I stink at accounting. I won't do the accounting. And that will prove I am horrible accounting because I'm not touching it. Well, if we call ourselves an entrepreneur, I think unfortunately that term has become bastardized to say hustle and grind. You're an entrepreneur, you got to work harder than anyone. You got to grind out more than anyone to gain the success. That was never the definition of entrepreneurship. It's always been someone who sees a vision and organizes resources and people to get to that vision. They're the great risk taker. How do we make a vision come true? By organizing others to engage in it. So I was like, well, the word entrepreneur, as much as I love it, it's been damaged and we start behaving like a hustle and grind person. What's the new word? And it's like, oh, it's shareholder. I own stock in a public company and they send out their quarterly profit distributions. When I get it, I don't say, oh my gosh, I need to run down to this company and earn these profits by working harder. I don't work for them, and I don't say I got to return the money to them. I simply say, I was a investor in this business. I took risk. I'm hoping the valuation goes up, it could go down. This is a reward to me for taking risk as an entrepreneur. Chances are you are a large shareholder. 50% if you have a partner, more 100% if you're solo. You are the shareholder, and you have to have shareholder responsibilities, which means have a vision for the business. Just like the stock I own, I vote my vision. We influence the board. We select whose board members. We do strategic planning through voting. And that's what you do for a business. It's that design work. That's what a shareholder does. They think about the future. They take the risk and make the investments to. To get there. And by saying the word shareholder, you can start complying with it. Now, here's the challenge. And it's weird. Every time you're at a cocktail party or you're visiting with friends, they say, what do you do? You meet someone new, say, I'm a shareholder of a small business, and it is freaking awkward. What does that mean? Like, I don't even know what it means. I just said this because Mike made me say it. But once you say it enough times, you start complying with it. You're like, okay, I'm a shareholder of a small business. I'm not expected to do the work. I'm expected to design the outcomes and sharing the profits because I've taken the risk of investing. So stick with it, brother. Not easy, but stick with a certain day.

You'll Shareholder of a small business.

Love it's right.

I will. I will. I promise you.

I'm a shareholder of a small business, too. It's awesome. There you go.

That's going to throw me even more if somebody who is it was work for the methods and whatnot. So that straight back to me. Hang on a second.

You two will hug it out. You'll be like, oh, my God, you're my best friend now. I found you. Yeah, I found you.

Thank you. So, okay, I got two more questions, and this slightly goes down a personal route, but I feel it'd be good for any budding authors out there. So I'm about to embark on my, my second book now Toilet Paper Entrepreneur was released in 2008.

That's right.

And then you've got the pumpkin plan, which Google tells me was four years later in 2012.

That's right.

Since then, every single year after 2012, pretty much every two years you've released a book. So what and why? Can you speak to the fact why was there a four year gap? Does there any reason being what was the reason for a four year gap? And the second part question to that is what's the one piece of advice you would wished you had received from going from the first book to the second book before you went back?

So one of the reasons there was two reasons but there's one of the main reasons why there's a four year gap between my first book and second book was brand new to authorship and I was working on one concept toy Paper Entrepreneur from start to finish, finished it and then said okay, what's the new concept? As I was working on pumpkin planes like oh my gosh, I have all these different concepts that need to be in different stages. So the first stages is what's not working in the entrepreneurial community. People aren't profitable, for example, consistently why and start throwing theories out there and then start testing. So as I was writing the pumpkin plan, Profit first for example was being tested and deployed and worked on. Then as I'm finishing writing Pumpkin plan now I'm in the process of ramping up profit first and that's how I do it. So Clockwork, while it's being released next month, as of this recording or posting one year from now, one year and a month or two, my next book's coming out. It's halfway through the writing I call codification stage. The systems have all been tested. We got the concept. Now I'm just writing it and putting it together as I finish that manuscript which will be done in the next four months, five months typically I'm already have the next concept that we're testing out around here and should be in full kind of writing mode a year and a half from now. That keeps me on this pace. Work on multiple books at once. That's the secret.

Work on multiple books at once. Very clever. No, that explains a lot. Thank you very much for doing so. Okay, so the final, final question and I'll let you go. So I really do appreciate your time. So I would say the book that I gift and recommend the most is Clockwork. That and Tools of Titan by Tim Ferriss and oh, that's such a good book. Yeah, love that one. And Storybrand by Donald Miller.

So that's awesome.

Those three books are the ones that I give the most. But I'm curious to know, is there a. Is there a book that you gift the most? Is a book that you recommend or gift the most to entrepreneurs or just any in general? Is. It can be fiction, nonfiction, but is there.

Yeah, yeah, yeah. So there's so many books I read. Read that I gift very specifically. I used to say, oh, you. You, Mark, need to read this book. It's so good. Then I discovered that's not a good question to ask or thing to do. I found, what challenge do you have? So I ask people now. I'm like, hey, what challenge are you facing? I literally just had a call with a business owner two days ago, and they said, we have to let go six. Six staff members. Not because they are not performing, because our company's in trouble. How do I communicate this? I'm like, oh, have you read verbal Judo? Judo. Have you read. Never split the difference. Like, no. Like, two books are on their way to you. So I love a whole gambit of books, and I recommend them. I. I don't. I don't have one. That's my religious one anymore, if anything, maybe e myth, but there's not one I. I like to.

I like that question, though. It's the. What are you struggling with?

Because you struggling now. Yeah, yeah, yeah. Because otherwise, I found that I'm throwing people off course. Like, their problem is hiring or getting rid of some people, and I give them a book on, you know, financial management. It's not in sync with their biggest challenge.

Yeah, definitely. No. Thank you very much. I really appreciate it. So, okay, time for the big pitch. The Clockwork Revised and expanded design your business to run itself. What is the. The release date? And where can everybody go and grab a coffee?

August 25th. 5th is clockwork revised and Expanded. You can find it on at any bookstore. It's on Amazon, Everything.

Amazon, Everything.

And if you go to Clockwork Life right now, you can get some early access stuff, including, I think it just came in a few days ago. We have some collector's edition copies right across my hallway here that we're gonna be sending out if anyone is interested in purchasing one of those.

Perfect. So Clockwork Life, please do go check it out. Really? Really thank you for this. You can find Mike McClitz everywhere, YouTube you all on the socials. Thank you so much for your time. Really appreciate it. Thank you. Thank you. Thank you for doing this, and thank you everybody for tuning in. Wherever you are on the social Sphere or the YouTube or podcast, it's everywhere now. So thank you again. Thank you so much everybody. And we will be back again with another podcast episode very soon and we will see you out with another freestyle app. Thank you everybody. Thank you. Mike, thank you so much for checking out today's podcast episode. Now, before you head and go anywhere else, before you click to the next episode, before you do that, do me one big favor and go check out boostly.co.uk trust IPRAC are the sponsors of all of the Boostly content. And the reason why I work with them and the reason why we spread the message of IPRAC is that when a host or a company is looking to get more into direct bookings, the main question they have is around trust. As in, will a guest trust that I am a true and real business? Will IPRAC take care of all of that? And they've got a special offer that is only available to Boostly people. But to do that you need to go to Boostly, which is b o o s tly.co.uk forward/trust. You can find out all the information there. You can book in a demo, book in a call, and then you will get your super special offer that is only available to Boostly peoples. Thank you again for tuning in. Do go check out Iprac. We'll be back again very shortly with another podcast episode, but until then, we'll see you all very soon. Take care.