Why I Take Vacations to Make My Company Better

We're going to explore the concept of moving from a doer to a designer within your business. This is for a business owner and if you're a doer, it means you're working within the business in some capacity, usually in a form of deliverable to the client. You're doing the technical services or managing the deliverable. Sometimes it's in a sales capacity, in fact, usually it's a combination thereof. We're going to move from that person to a designer. A designer is someone who works on the strategy as a vision, works on the core design decisions that move the business forward. And I don't know who the truth is this to, but one CEO famously said, I am paid my extraordinary fee to make three or four major decisions a year. And that's what I consider. Designer Michael Gerber in his book E Myth Revisited famously said, don't work in your business, work on your business. That's what we're going to talk about. When I travel around and speak with entrepreneurs, I will regularly ask why did you start your business? And the number one piece of feedback I hear is I want financial freedom. That's, that's usually the top one. And right next to it is I want personal freedom. Personal personal freedom is to do what I want when I want. In other surveys speaking with audiences, I ask what is your intention for the company when you're done? And it's a liquidity event. I want to sell the business one day. Well, this designer component actually facilitates all three. It's going to bring about that personal freedom. It brings around financial freedom and also brings that liquidity. Your business becomes plug and play to an acquirer. One of the things that's most commonly identifies that someone has the problem is, is simply the vacation test. I'll ask an entrepreneur, I'll say when take your last vacation. And the answer is usually vacation. Are you kidding me? I don't take vacation. Met with a bookstore owner down in Point Pleasant, New Jersey and I asked that question. She said I don't. I work 12 hour days every day unless I can get someone in to fill in. But I'm usually almost always here. This is my life and that's what we're going to fix today. A couple sources that you may want to investigate is E Myth Revisited. Actually had an interesting dinner with Michael Gerber. Years ago, we shared a stage in Mexico, Monterrey, Mexico specifically. After the event, we went out to dinner together and I asked Michael, I said, what's the challenges that you run into or experience with E. Myth? He notably is a kind of eccentric guy, so I won't share all of the colorful language he used. But he did say that most entrepreneurs think it's a switch, that if I simply work inside my business long enough, one day the business will work for me. It's going to flip over. I'm not working in. I'm now working on. And the reality, as we discussed this, is it's a throttle need to slowly, systematically, consistently, persistently extract you from doing the work within your business. There's actually four stages that I've identified. You go from doing to what's called a deciding stage, which is identified offense micromanagement to a delegation stage, which is the ideal scenario is actually how you want to manage the business as a managerial component to designer, which is the visionary. Other great books out there are traction. By speaking with Gino, he kindly endorsed my book Clockwork. He shared that in his experience, a EOS and entrepreneur's operating system is effective when there's a managerial suite. So some businesses are prematurely implementing an EOS and they. The owner is the only person there. Careful of that. You need a managerial team. The question, of course, is how do you get to that? Scaling up by Verne Harnish. That was actually a collaborative project. It's a fantastic book on this subject too. So let's talk about the common approach from moving to a doer in the work to a designer and why it doesn't work. The most common challenge or thing I hear is I wish I could just find more of me. So if you're in that category, you're not alone. This is where an entrepreneur says, if I could just find a replication of myself, if I can find a duplicate of me, this person would be amazing for my business because I effectively do everything. I call it the superhero syndrome, where there's this perception that we can do everything well in the business. Reality is just because we can do something doesn't mean we do it well. And we often bring about a lower standard for the business while we think we're bringing about a higher standard. Oh, I know how to do the accounting. This is the standard I want to use when if we properly delegated and empowered people, we may find more efficient, more effective ways of doing it. So be careful of this superhero syndrome. By the way, looking for someone just like you is absurd because you have your own business. So if you own your own business and you're looking for your clone, that means you're looking for someone who owns their own business. Why would they ever want to work for you we can do a technique called fractionalization. I'm not going to devote this session to that. Fractionalization is where we split you in pieces, where all the elements you do we can find people to fill. That I do want to talk about though is this other component which it's delegation, or at least the mislabeling of delegation. I speak with business owners, I ask them what do they like to do? And they said, I like to manage the entire system myself. And then when I find someone to fill in a component, I have them take over and I leave it to them. There's no measurement, there's no nothing. It's called abdication. Abdication is an abandonment. The challenge, of course, with abdication is you bring someone on board. And I'm not saying it has to be a full time employee, be part time. It can be a vendor, it can be a contractor. You bring someone on board, you assign out the work and that's it. You abandon it. Challenged with this, of course, because the person loses the ability to know where they're headed. They, they don't have guidance and so forth. The other component we often run into is micromanagement. Micromanagement is where we tell people, here's what you're going to do and check back with me at every step. I call this task rabbiting. Do this and if there's any questions, any challenge, come back to me. There's a Hindu goddess named Kali. Kali, you probably know the figure is a female head with six arms. That's what many businesses become in a micromanagement environment where the owner is controlling everything. Of course it corrupts trust, it brings about bottlenecks. You, the owner of the bottleneck. It's hard to retain skilled people. If you're low skilled and you want to follow explicit direction and just do what you're told, then it's a fit. But higher skilled people will move on. One of the symptoms here is when I ask someone, what's your work schedule? And they say, oh, I work nine to five, nine in the evening till five in the morning. That's someone that's micromanaging. Because the other 9 to 5, 9 in the morning till 5 in the afternoon, they're managing other people making decisions for them. That becomes what's called the deciding trap. In the world work I do. When I wrote about this, I called it deciding trap. The other kind of problem or thing that you may mana, you may experience is what I call the crutch. That's where you're doing everything for the business, and therefore your business has an artificial dependency on you because you're doing everything and you're not often paying yourself accordingly. Your business becomes dependent on this and it becomes the standard for your organization. So we will need to avoid that crutch. If you ever had that feeling of I wish I could go back to the old days, maybe a few employees. That's another manifestation of micromanagement or abdication. Not working, everything's failing, and go back to how it was back in the days. I do want to point out some research I looked into. I think you may find a value when it comes to micromanagement. There was a research done by Desi Costner and ryan back in 1999 in the Journal of Experimental Psychology. It's called the Impact on Intrinsic Motivation. What they found is that motivation diminishes when an individual feels micromanaged, which has a negative impact on their productivity. There was Another study by T.M. amer, I hope I said that correctly, of the Academy of Management Journal said that excessive oversight can hinder performance by limiting an employee's ability to develop themselves. Also, there was a research back in 1995 in the journal of Management about employee turnover and seeing higher turnover rates when people micromanage. You may remember there was a real case that happened. Oh gosh, was this about five years back now with Yahoo and Marissa Mayer? Do you remember this? Marissa Mayer came on. She had, during her tenure at Yahoo. Was criticized for her micromanagement. What did she do? She required people had to come and work from the office, right? She mandated that. But she was found to have slowed down their innovation because she was managing the company's recruiting herself. She had to look at every single employee to consider if they were fit or not. And she was involved in these little micromanagement components. They saw a morale drop and well, you know what Yahoo is doing today? Just an interesting study. Now that was micromanagement. I want to talk about the abdication and research around that. There was a 2022 Gallup study called State of the Global Workplace and specifically with the engagement and employee outcomes. They found that employee engagement is crucial for high achieving organizations. Their performance, including the company's profitability and productivity, is contingent upon employee retention. The lack of engagement from leadership resulted in lower overall engagement, which points to the importance of active leadership with employees. So the abdication actually decreased performance of the employees, hence production of the company. There was another study you may have heard of in the healthcare industry, identified that consistent leadership, where there was standardization, brought about higher levels of Health for these organizations study was done by provenost back in 2006. I came from the first name was P. Provenost and identified that ICUs had better better service levels when there was a level of checklists and protocols in place. Even if people knew exactly what they were doing, meaning they had the knowledge and education. But when they maintained a checklist and certain protocols, when you got quote unquote lazy or you were just skimming through things, you were no longer missing things. And they reduced infections and other health issues at these ICUs. So what's interesting is that kind of that counterpoint abdication was you're on your own, you got this. And this was a component. They weren't being micromanaged but a checklist to make sure the most critical things were done. Next time you're on a flight, you see a pilot walk out of the plane to do the walk around, see if she's carrying a clipboard or some kind of checklist. This is a way to ensure that they are observing and noticing the most important elements. An interesting case of abdication. It really is finger pointing came out with RIM BlackBerry. Ever own a BlackBerry? And what they identified was they had a dual CEO structure. It was Jim Bacilli and Mike Lazardi's and they were both CEOs causing unique structure of finger pointing. Which then said they were saying this is his responsibility. No, no, that's his responsibility. Which slowed down decision making. There was confusion, people were left without specific direction. And you know the rest of the story of rim. I think they had a new operating system that they were developing that was going to compete with Apple and they got delayed perpetually and ultimately brought about the collapse of of rim. So some interesting insights there. Now the question is of course what's the approach? I have a contrarian approach for you. Surprise that I think will be a game changer. It's really two components. First is taking a four week vacation in a small business and micro enterprise. I'm Talking about companies $5 million in revenue annually or less. There is this crutch component and that is often the result of either delegation or micromanagement. But the business owner effectively sees themselves as the most important part of the business and the business becomes highly dependent upon that. We actually need to start extracting the owner from within the work. As a business coach of mine once said Barry Kaplan, he said, Mike, sometimes the fastest way out of the weeds is just to walk out of the weeds and a four week vacation triggers it. Now here's what I'm asking you to do. I want you to schedule a four week vacation, you know, 12 months to 18 months from today. So it's far enough out that we can work toward preparing for this, but we're going to commit to it. This is a full physical and digital disconnect. Now, if you feel, oh, this is overwhelming or I'm frightened, that's a good thing. That means you intrinsically know there is or are problems in your business that need to be resolved and it will start a prioritization process. So it is a great catalyst to stop working in your business, being a doer. Start working on your business designer schedule a fortification. By the way, commit to people. So there's no way to abandon this. I would commit to family or whatever. Another topic or point about this fortification. It's not about you getting a vacation, it's about the business getting a vacation from you so we can start healing the business, get the business working efficiently. The concept is this concept I call the qbr, the queen bee role. What is the core function with your business? That is the most important function. Because if we focus on that and we amplify that one component significantly, your business will be radically healthier. It will differentiate yourself from everybody else. What's the one thing you want to be known for? The qbr, and I'll dedicate a video to this is conceptualized by first figuring out what is the promise to your consumer. My job as an author, my commitment is. Well, my purpose is to radically entrepreneurial poverty. But my promise to you, the consumer, is I will simplify entrepreneurship. But really simply, I put entrepreneurship simplified. So then I ask myself what. What helps simplify entrepreneurship while providing accessible ways to handle complex topics? That's what we're doing together right now. My primary vehicle is my books. And this is a supplemental vehicle to that. Taking these confusing concepts and hopefully making them more accessible, giving you simple actions. Maybe not easy actions like taking that fortification, but simple actions to take. What's the one thing that's the most important thing? Now, if you ever read the book Essentialism, that's by Greg McCowan, he wrote this concept of focusing on less to achieve more. It's also referred to in Good to Great by Jim Collins is the hedgehog strategy. The hedgehog, the animal defends itself every time by rolling up in a ball. And that way it's not consumable, all the spikes and so forth. And so another animal touches it and just stays in that ball until it's safe. That's the hedgehog principle. What is Your one thing they need to dominate. Now when you take this four week vacation, I want you to think about what is the core thing the business must deliver on. What's the heart of our organization. We're going to start standardizing that. I did another video about SOPs and how to bring those about. So check out that video. I want you to see how you can bring about SOPs and standardization to your organization. What my suggestion was in that video is do not do the standard SOPs, which is, I don't know if I kind of drew it out here, but I got a checklist you know of do this, this, this, this, and to pack our UPS shipments. No, don't do that. We're going to do a thing called Captures. Captures is a video sequence. So check out that video. There was research back in 1990 by Prahalad and Hamels. They focused in this concept of core competencies. They argued that a business that focuses on its core competency will achieve competitive greatness. One that dilutes itself will not. There was a case with Howard Schultz, the CEO of Starbucks. And this is back on February 26th of 2008. I don't know if you remember, he retired as CEO, left as CEO, came back. They were expanding rapidly, but the quality was degradating. They lost their hedgehog, they lost their qbr. That core competency. He shut down all of the Starbucks. This was partly for the dramatic effect, but retrained all employees that day that were baristas and showed them protocol they're going to adhere by. So for one day they shut down the business. The point is we need to identify that core thing and then get you out. I did this for myself. When in our business we determined we simplify entrepreneurship. Our core thing is to distribute books and content. That does it. But gosh, if I keep doing it, it's going to be fully dependent on me. I went on a four week vacation. I actually went to Perth, Australia, left the organization for a sustained period of time and prepared as best I could to leave the organization. The interesting thing, and I think you'll experience this too, it was heart wrenching. It was terrifying. I thought, oh my gosh, I'm gonna come back to a business that's no longer there. So leaving the business was a big challenge. And that's probably the first component. There's this emotional attachment that I had to my company greater than the actual function was. I felt it was part of me and therefore separating myself. It was like conjoined twins. We had a very surgically Remove myself by taking this for vacation. The first thing was the mental block. I remember returning to the organization and talking with my team. I said on a 1 to 10, how badly do you need me back? And they gave me a very low rating. They said we don't need you back, but we love having you back. Go out and be the cheerleader for our organization, be the spokesperson, but we've got this. My team felt empowered. So to move from a doer to a designer is actually predicated by extracting the owner from doing the doing work in the first place. Micromanagement, abdication forms of those delegation is often bastardized and we're trying to find our clones. I think you may already have the team you need. And listen, you may not have individual, even full time employees. You may have part timers or vendors or contractors. That's all your team. You may have technology that's part of your team. First thing here's the big call to action is you need to schedule a vacation. I challenge you to schedule a four week vacation within 18 months of today. Put it in your calendar four consecutive weeks. What's magical about four weeks is this that if you leave your business for four consecutive weeks, every element of the business is often touched on. Now what's going to happen is you're going to have that little bit of emotional or a lot of bit of an emotional heart attack. I can't leave. That's good. Then the question is why do you feel that way? And we have to start working on this while adhering to that fortification. This is not theory or something. Be one day I'll take a fortification. We must commit to it. By the way, if you don't commit to that fortification, it's a common. I don't know what's going to be a health scare or something or someone's going to need you outside the business. And if you're not prepared for it, it could devastate the business. So this is like a fire alarm. I remember as a kid in grade school we had fire alarms. Maybe you did too. What would happen is they set off the alarm and we'd all stand in single file and we'd walk out according to the teacher and go to a certain area to gather. And it was always a test. Until one day we actually had a legit fire. And there was no panic, no one got hurt, everyone was fine. But it was a serious fire. What happened? The alarm went off and everyone went through the protocol. This fortification is a test for that. I do understand. Unfortunately, in modern circumstances. There aren't necessarily fire alarm drills alone. There's other drills, but fortification is this form of a drill. Want to impart with you one last concept. It's the three, two, one technique. This is a little bite sized piece. What I challenge you to do is this. If you won't commit to the four week vacation in 18 months, I really hope that you do. I want you to do the three, two, one method within three months. What are two of the critical tasks you can delegate or need to delegate to leave for one week? So three months from today, I want you to schedule that one week vacation and identify the top two critical tasks that you're doing that need to be delegated for that vacation happening. Take a one week vacation. One week vacations are nice because it puts a little test in the business. But you can recover if major problems present themselves. And I'll tell you this, if problems present themselves, those are problems you fix on your next 3, 2, 1. Your next one week vacation you take three months later. And those problems that present themselves are the things you need to fix. So there you have it. Time to move from a doer to designer. If you don't, if you stick with micromanagement or abdication, your business inevitably will not grow. It will not be healthy. I don't think you're going to achieve that vision you have for yourself. I know you won't. Of personal freedom. Remember this. The job of an entrepreneur is not to be a doer of jobs. It's to be a creator of jobs. A four week vacation is the path to get there.