Episode: How Healthy Is Your Business?
Michael Hyatt: Hi, I’m Michael Hyatt.
Megan Hyatt Miller: And I’m Megan Hyatt Miller.
Michael: And this is Lead to Win, our weekly podcast to help you win at work and succeed at life. In this episode, we’re talking about business health: what it is, why it’s critical, and how you can make an honest assessment of it. Our format is going to be a little bit different today, and I’m really excited about this episode. Today we’re doing a live coaching call with one of our listeners, and we’re going to walk him through his results from our free Business Health Assessment tool.
Megan: Yeah. We’ve done one of these live coaching sessions before, and I am so excited to get to do it again today.
Michael: Yeah, me too. I really enjoyed the last one. As always, Larry is here to walk us through the process. Larry?
Larry Wilson: Hey, guys. You know, you both have a wealth of business experience, and I wonder, as somebody who has not been a leader in a business setting, do you think most leaders really know the true state of their business?
Michael: I don’t think so, and I think it’s probably because, for most leaders, the information they get is filtered. If they don’t create the right culture, they’re not getting probably as much bad news as they need to course correct. They’re probably getting more of the good news than is really there, so it’s a little bit imbalanced. I think it takes tremendous self-awareness and intentionality on the part of a leader so that you get unfiltered information and can really monitor the health of your business.
Megan: It’s also easy to just be consumed with the day to day. You’re kind of in the weeds of running your business and putting out fires and things like that, and it can be rare for you to pull up to 30,000 feet and have the kind of visibility you need to really assess the health of your business.
Larry: I think a lot of leaders in any context get fixated on one metric. In business it could be revenue. As long as we’re making sales and gaining new customers, what else could go wrong? Right?
Michael: As it turns out, a lot. Revenue growth can’t be your only metric. I had a business, owned a business back in the 80s where that was the primary metric we were watching. We thought, “We’re not making money, but we’ll make it up on volume. Eventually we’ll be making money. We just have to get our footprint in the marketplace big enough.” That’s really not a good strategy, and a lot of businesses, including my business back in the 80s, did go broke, because we were only paying attention to that one metric.
Larry: Now this call is going to be based on our Business Health Assessment tool. You guys created this, so before we get into the call, let’s give people a little background on exactly how it works so they can understand what we’re talking about with our listener.
Michael: We talk about seven pillars of business growth. It’s very easy, if you’re not self-aware, to get fixated on one metric, as we discussed. So what we identified (this is largely based on my experience both as a businessperson and in coaching hundreds and hundreds of business owners and executives and leaders) is that there are seven pillars, seven things you have to focus on…things like Vision, Focus, Team, Culture, Clients, Data, and probably the most important, Yourself.
What this assessment does is allows somebody who considers themselves a leader… It might be a leader of a department, it could be a leader of a team, could be a business owner, could even be in a nonprofit context, but to self-assess on these seven pillars and say how I’m doing. We give people the opportunity to give themselves a score between 1 and 12. It’s very descriptive, very easy to do, very fast to do, but then all of a sudden they reduce everything to a number. This is your score. This is your Business Health Assessment score. Once you’ve measured it and given yourself a baseline, then you have the opportunity to improve it over time.
Larry: For anyone who wants to take that assessment for themselves, they certainly can. It’s free at businessaccelerator.com/health. So let’s get to our call. We’re going to be speaking with Andy Bond, who is the president and managing partner of a real estate company in Chattanooga, Tennessee. Let’s get Andy on the line.
Michael: Andy, thanks for joining us for the podcast. Tell us just a little bit about yourself and what you do.
Andy Bond: Absolutely. I am the managing partner and president of The Lea Team and Keller Williams in Chattanooga, Tennessee. It’s a privilege to be a part of this organization. I’m 37. I’m married, have five children. Just excited to be chatting with you guys.
Michael: Awesome. Five kids. I can definitely relate to that. I raised five daughters. I have your results in front of me from the Business Health Assessment, and I’m super excited to talk about those. I know Megan is as well. When you took the Business Health Assessment, I’m just curious, was it easy to use, and how long did it take you?
Andy: Yeah, great question. It was very easy to use. Kind of surprisingly easy, if I’m honest. I really think a lot of assessments… There’s no nuance associated with them, so they ask some generic questions and don’t clarify. I’m a little bit of an overthinker. When it’s too generic, I have difficulty answering accurately, but I thought it was really easy to take and very helpful, specifically because you’ve thought through the subtle nuances, and I felt like I could actually give you some really accurate responses to the questions asked.
Michael: That’s awesome.
Megan: That’s great. Well, we have your results right here. For listeners, if you take this yourself, you’ll actually be able to get your own results instantly online, which is really fun, to be able to know exactly how you’re doing very quickly. Andy knows his raw score, but we want to help him understand it a little bit better in this call.
Andy, your overall score was 48. The maximum score is 84, so you were about 50 percent of the way to your maximum potential there, which is definitely a good start. The other thing is that the score was balanced. Your Vision, for example, was slightly lower. Your Team was slightly higher. All of the other pillars of business growth were right at the midpoint. As you were taking this, did you have any surprises with your overall score?
Andy: Well, I’m going to say actually no. I’m keenly aware of the need to grow. I honestly think when you say I’m about half potential, that feels right on the money. I really wasn’t surprised by anything specific.
Michael: When you looked at your overall score and the individual scores for each of the seven pillars, what do you see as your biggest opportunity or challenge right now?
Andy: Getting clarity on taking the vision, making it more clear, and then piecemeal-ing it out in a tangible way to my team. I kind of came into this positon with a little bit of a chip on my shoulder. I had the massive privilege of taking 50 percent ownership of this business. I’ve worked my way up. I presented a proposal to the owner, and two months later the owner of our team was like, “Hey, I’m going into development. See you later.”
I came in as a very successful salesman, but being a great team leader and business owner and being a very successful salesman, I was missing a lot of… And I still am, if I’m honest. I’m still missing a lot of the tools to grow the team to the place where I want it.
Megan: I think it’s important to know that what you’ve just said is so common. When we talk to our clients, some version of that is shared with us very, very consistently. It’s really common for people who have excelled in their career to find themselves in a position where they’re a little in over their head, or out over their skis, to use another metaphor. That’s really common, so you’re in good company. It’s not a bad place to be. I think there’s a lot of opportunity there.
Michael: Yeah, and I think it’s indicative of the fact that you’re growing. I feel that way myself. We grew 62 percent last year, and I feel like I’m a little bit out over my skis, but if I’m honest, I kind of look back on my career, and I’ve always felt that way. I kind of like it, because that keeps me growing. How would you say you feel about your business overall right now? Frustrated? Maybe stuck? Excited? What’s the emotion around 2019 as you look forward to this year?
Andy: I’m really excited. The emotion is excitement. I could not be more proud of the people on our team. We closed 44 million last year, and that was right after my business partner and I made a strategic decision to split off a client that represented 36 percent of our volume, because our vision for the team and the vision of their business were starting to get enmeshed, and we started to lose sight of why we were doing what we were doing.
That was a hard decision, and 2018 was a rebuilding year. We have incredibly talented people who I am excited to be in business with, but that doesn’t change the fact that the road ahead is very much uphill. I feel like the real estate market is moving back into rebalance. There is a shift taking place, and I want to make sure we’re in the habit of taking the actions that are going to set us up for success during that shift. But I would say excited.
Michael: The good news is regardless of what your score is, it’s only a benchmark. It’s a measurement in time. It’s a snapshot of where you are, and it can always be improved, which is awesome. So let’s walk through a couple of the pillars of acceleration, as many as we have time for here. I want to start with Vision, because Vision was one you scored yourself a 5 on, which is just under the midpoint. It was the lowest score you gave yourself.
My guess is, based on that, you probably have a written vision statement, but it might be just a little bit too general to be meaningful and you’re not really using it in guiding your planning. You can correct me if I’m wrong. Leaders inside your business probably have a good understanding of where you’re going, but as you move down the food chain, so to speak, as you move deeper into the organization, maybe team members don’t quite understand. They don’t have the clarity around the vision. Does that sound accurate?
Andy: Yes, it does.
Michael: So, what’s working for you with the vision as it stands right now?
Andy: The opening statement to our vision is “We are a team of leaders and we’re committed to coming together and growing an organization to earn significance in our community.” We feel like real estate is a backdrop for a little bit of a deeper mission. The reality is if we focus on growing ourselves as leaders, I believe the rest will kind of follow suit behind it.
We all went to a national real estate conference together, everybody on the team, from top to bottom, because we embrace that we are a team of leaders. With leadership comes personal growth and business growth and embracing change. It comes with a mindset that makes our world at least have the potential to get bigger.
Michael: That’s good. Well, just a couple of tips I want to give you on vision. First of all, I think it’s really important as a business owner (and I see so many business owners not do this; in fact, the vast majority don’t do this) to get clear on what role the business has in your life, because if you’re not careful, one of the things that happens as an entrepreneur… The demands of the business are so intense that, if you’re not careful, you end up servicing the business, and the business becomes this all-consuming thing that sucks up your life, as opposed to saying, “As I look out over the next 3 to 10 years, what role does my business play in my life?”
You have five kids. What’s your vision for your family? What’s your vision for your health? What’s your vision for these other aspects of your life? Then what’s your vision for the kind of business, the kind of hours you keep, the kind of intensity you have, the kinds of rhythms inside your business? How is that going to serve your life? Then beyond that, inside the traditional corporate vision, one of the things we recommend, particularly in our BusinessAccelerator program, is that you have a narrative vision, not this clever one-line statement.
I see a lot of people spend way too much time trying to distill a vision into a clever thing that I think could be a great tagline but doesn’t give enough detail. You want something concrete, specific, a couple of pages long. It needs to cover specific areas, and you need to state your vision as though it were a present reality. In other words, something that already exists. That gives it a power and an intensity and a directness you don’t have unless you do that.
The final thing I would say is just keep that visible. As a leader, you cannot repeat it too frequently. Andy Stanley says that vision leaks, and he’s exactly right. Just when you think you’ve filled the bucket, your team is stressed out or they’re in the middle of a deal and they forget the vision, and it’s up to you… You’re the voice of the vision. If you don’t give voice to it, it’s not going to have a voice.
Megan: I think it’s critically important. The endgame is that everybody understands their role and how it contributes to the larger vision. They’re not only aware of it, but they can connect the dots, and not just your leadership team, but everybody in your organization understands how they’re a significant contributor to the realization of that vision.
That’s really exciting when that happens, but like you said, it happens because you say it a lot and actually draw those connections for people. If that’s your executive assistant, you explain how when they support you that makes it possible for you to lead and how critical that is to the mission and vision of your organization. So that’s a big part of this.
Andy: Love that.
Megan: Another pillar of growth is Focus. This is an area where I think you have a lot of strength. You scored a 7, which is above the midpoint. So I’d expect to see that, generally, you’re focused and disciplined, that you’re getting good at saying “no” to opportunities that are outside your vision, that you concentrate on a core suite of products or services that make sense to you and your business vision, that you generally execute well, meet client expectations, and retain business. Does that sound accurate?
Andy: Probably a little bit… It is accurate. If I was taking the score again, I might put a little bit worse than what you just stated. Not a lot worse, but a little bit.
Megan: That’s funny. It can kind of vary at different parts of the year. It’s like you’re doing really well, and then an intense season hits and you lose a little focus. That’s normal. So tell me a little bit more about what’s working for you in the area of focus.
Andy: Having rhythms on the team really does help. Gathering everybody together, connecting with them, and then giving them a clarity into the day. I think that ties in a little bit what you said about you have to restate the vision over and over and over. I know, for me, forgetting is unfortunately like a disease. I forget my own vision.
You get slammed with so much chaos during the day it’s easy to jump in and put out a fire that really wasn’t a priority, but the pain of the moment kind of drags you in. I think what we’re doing well is gathering together, having our power meetings, and letting everyone be real for a minute and connect, and whatever that thing that’s holding them back, maybe allow that to come to the surface, and then refocus everybody so they feel like they’re not doing it alone.
Megan: That’s great. Well, a couple of practical tips here. It’s really important that not only do you have a vision but that you have broken that down into a series of annual goals you’re pursuing together as a team, and then it’s not just about having those annual goals (it sounds like you may be doing some of this already) but it’s keeping those goals visible on a regular basis for your team. We do this on a monthly basis at our team meetings, where we report on our progress toward our annual goals. We also do it at quarterly team trainings, and certainly we’re doing it on an individual level on a daily basis and as a part of our weekly preview process.
This is really important, because if you don’t, first of all, understand your vision, but then understand what that looks like practically on a 12-month horizon, then you can get really distracted and lose your focus on the things that are going to drive results and drive you toward your larger vision. You get something shiny over here. Like you said, you have a fire to put out, and it can really take you off course if you’re not careful. So the visibility on a regular basis, not just for you but for your team, is probably one of the most important things you can do as a leader in a high-growth business.
Michael: I was pleased to hear you say, Andy, that you really pruned in 2018. A lot of business leaders are not willing to do that, because it is a step back, but it’s a step back to take a leap forward. I think to continue to get in that cycle… Focus is really the application of vision. It’s taking that vision and deciding what you’re not going to focus on. I quote Steve Jobs in my new book Free to Focus, which is coming out in a few months. He says he was as proud at Apple of the things they decided not to do as he was of the things they decided to pursue.
When he came back to the company in 1997, having been away from the company for 12 years, he got hyper-focused on pruning everything that wasn’t desktop computers for consumers, laptops for consumers, desktop computers for professionals, and laptop computers for professionals. So there were four categories, and anything outside of that they cut. It was ruthless, and all they did was get profitable, and, of course, Apple is reaping the results even to this day. I really believe it began back when Steve decided he was going to be more focused and the company was going to be more focused, and they reaped the benefits of it.
Megan: Yeah. When we think about vision, we talk about it at 3-year and 10-year time horizons, and then goal setting on an annual basis. All of those things provide a filter for us, as leaders, so we’re able to say yes to the right things and no to the wrong things so we can stay on course to get where we want to go.
Michael: Well, let’s move to the next category, which is Team. This was your strongest area. You scored yourself an 8 in this category. Again, 8 out of 12. I would expect, based on that (and you can tell me if I’m right or wrong, Andy), mostly A-players, maybe some B-players, a fairly good hiring process. You’re recruiting based on character, competence, chemistry, and conviction (and by conviction we mean people who are aligned with your mission; they’re not just there as mercenaries, but they have a conviction about what it is you’re trying to create in the world), and you have pretty good retention. Does that sound pretty accurate?
Andy: It does. Again, I am just super proud of the people we’ve onboarded. Our interview process is very extensive. Part of that is just… It’s not just for us; it’s for them. I feel like the more I know about them and how they learn and what their personality and behavioral traits are and talk to their past employers, I get a clarity on a sweet spot for them or not. I think the struggle… Maybe I’ll just turn this into a question.
The character is there. The chemistry is there. The commitment is there. I think the conviction… I feel like I, as an individual, am moving from a little bit of a chaotic, undisciplined salesman to having to be more systematic and disciplined, which is hard, and I’m trying to have everybody course-correct with me. The only reason I’m not rating us higher than an 8 is because there is a lack of commitment to some of the harder things it’s going to take, be it like making X amount of sales calls.
I have a little bit of maybe even guilt, if I’m honest, with like, “Oh, well, have I resourced them enough so that they really feel well equipped to make their sales calls?” So I’ll wind up compromising the standard, which really is my fault, not theirs. I’m trying to just get this out on the table. We need to be more clear and hold a standard and reward the standard. Right now it’s a bit more loosey-goosey.
Michael: It’s interesting that you would say that, because I think most people would intuitively think, “If I lower the standard, people will like me, and there will be more commitment to the organization.” I’m not sure who asked me this. This is not original with me, but they said, “Think back. Of all of the teachers and the professors you had in college, who are the ones you remember?”
For me, I go back to the toughest professor I had…actually, a high school English teacher, Mr. Colethorpe (23:14). I don’t even know if he’s still living. He was so tough. The expectations were so impossible, but what I found was that I really looked forward to going to his class, because I was able to discover something in myself. I showed up in a different way to his class than I showed up at the other classes where there was less requirement.
To this day, I can’t remember most of my other high school teachers’ names. It’s an experience that came and went, but I remember Mr. Colethorpe. He gave me a love for English, and he made me understand that I was capable of more than I imagined when I started his class. I think as business leaders… I struggle with this too, because I want to be liked, but what I realize is that, more importantly, I want to give my employees an experience, my teammates an experience, I want to take the organization to an experience that’ll be unforgettable and make an indelible impact on the world.
That requires that, as business owners and team leaders, we have to be the ones who are raising the standard. We have to constantly be calling people back to a higher standard and saying, “You know, what you did was great.” We do need to definitely affirm the positive but say, “We as a team and you as an individual are capable of much more.” I think it’s easier for us to believe that for other people than sometimes it is for those people to believe it for themselves.
So that’s where I feel like, as a team leader, my job is to call out the greatness in other people, what they can’t always see, and take a stand for it, and when they’re not meeting the standard, it’s not that I’m beating them up or they embarrassed me, but, “You know what? You’re capable of more, and that’s not acceptable. I’m standing for a higher level of performance.”
Megan: A lot of this goes back to the idea of vision. They need to be clear on the why. Why does making more sales calls help to drive the vision forward and also help to drive their own results and compensation and reward forward? If they can connect the dots between the personal reward and the mission and vision of the company, that usually will propel people forward. Sometimes that gets lost in translation, though, and it just feels like something that’s really out of their comfort zone or they don’t feel equipped and don’t feel as resourceful as they could if they were compelled by a bigger narrative.
Michael: That’s really good. The thing about A-players is that when you have high standards you attract A-players. When you don’t have high standards, the A-players come in and go, “You know, this isn’t a game worth playing, because it’s not challenging enough.”
Megan: That’s right. Andy, let’s go on to the final pillar we’re going to talk about today, which is You and how you kind of assessed yourself as a business leader. You gave yourself a score of 7, which is, again, above the median there. Based on that, what I would expect to see is that you’re doing quite a bit of delegation already, but you may still feel a little bit or quite a bit overwhelmed at different times. You set clear guidelines when you delegate but still may not always get the result you want. Your team is mostly eager to pitch in (it sounds like what you just described), and you usually follow up on delegation to ensure progress.
Michael: The reason we’re talking about delegation under the pillar of You is the only way you can scale you is to delegate. You have 168 hours a week, and once those hours are taken… Obviously, you have to sleep, you have to eat, you have to shower, you have to spend time with your family, but in the work hours you have left, those quickly get apportioned out. So if you don’t scale yourself through delegation, your business is going to stop when you’re out of time.
Andy: I think it comes down to, for me, consistency to take myself from a 7 to a… If I’m, again, being completely transparent, the more I plan and prepare directives, the more momentum there is behind it and the more I delegate successfully. The battle right now is… It’s really a lack of discipline with me, personally, of just “When am I going to have no interruption to spend the time I need to spend preparing the directives to hand off?”
That’s really where the war is for me, and then it’s just the personal relationships, not having practice scripts for handing off customers who were mine for years, and now I’m handing them off to my team, and compromising and taking those back. It’s that people-pleasing, saying “no” thing that is really where the war is in terms of delegation.
Megan: That makes a lot of sense. Again, like I said at the beginning, you’re in good company. This is a hard area for people, because part of what got you to where you are is doing it yourself. It just unfortunately doesn’t scale. One of the things that can be very helpful practically, as you’re trying to improve in this area, is to get clear on what your greatest contribution to your business is. Usually people kind of generally know but maybe not specifically.
When we think about that, we call it the Desire Zone. This is something that’s out of the new book Free to Focus that’s coming out in a couple of months. The idea is that it’s the area where your greatest passion and your greatest proficiency, or your ability to drive results, kind of intersect. It can’t just be something that drives results; it also has to be something you’re passionate about, and it can’t just be something you’re passionate about; it also has to be something that drives critical results for the business, the most critical results for the business.
If you can identify three to five activities in that area that are what constitute your greatest contribution, then it begins to become clearer. Everything that’s outside of that are candidates for either elimination or delegation. You may just need to not do them at all or it may be things that other people on your team are more proficient at and certainly more passionate about than you are. So those are candidates for delegation.
When you start to think about the fact that everybody has a Desire Zone and what’s in your Desire Zone is not going to necessarily be in someone else’s Desire Zone, and, therefore, the things you either are not as good at or you find really draining may be the very things that are in the Desire Zone for some of your team members. What that means for you is you’re doing them a real service by giving them the opportunity to take on delegations from you, because you’re giving them meaningful work. That’s a real premise of how we think about work and delegation and leadership in our company.
Michael: This is so critical, too, Andy, for you to have margin and to have time to think about your business and to work on your business: getting all the stuff that becomes busyness and consumes so much of your day that somebody else could do better… I love this quote by Dawson Trotman. He purposed early in his career that he would never do anything of importance that others could or would do when there was so much of importance to be done that others could not or would not do. He focused on the things that were truly in his strength zone and delegated everything else away. I think that’s helpful.
As we come in for a close here, as you’re thinking back about the business assessment and our brief conversation here, what would you say is your biggest takeaway in terms of…? You talked about wanting clarity at the beginning of our call. What’s your biggest “aha” or your biggest takeaway as you move forward?
Andy: I think the final piece of what we just talked about, when you said passion and production… I can’t remember exactly how you said it, but it has to be something you really want to do and drives the business forward, and then what Michael added was “and that you can only do,” where your sweet spot is really… You’re contributing where nobody else can. Back to the clarity thing, I think just taking the time to iron out what that looks like, not just for me but for every individual team member.
Again, the biggest problem you guys have kind of exposed through your assessment has been going from generic to specific and to take the time to think through that. Honestly, I think your business assessment is a reflection of that. If you’re listening right now, I’d really encourage you to take it, because it really does force you to think deeper about the question they’re asking and get more to the core of what needs to change.
Michael: That’s awesome. Andy, thank you so much for taking time to chat with us. We really appreciate it.
Andy: My pleasure. Absolutely.
Michael: All the best in your business.
Megan: Thanks, Andy.
Larry: Guys, that was a great call. Andy has some really great opportunities in front of him but a lot of challenges too, and he’s very candid about that. Based on what you heard today, what would be your parting advice for him or somebody in Andy’s position?
Megan: The most important thing is don’t underestimate the value of clarity. We said that at the beginning of the call. I think you said that at the end of our call. When you lack clarity it’s very difficult to focus, and then it becomes harder and harder to drive results. When you have clarity, then you know what to do next, and it really propels you forward. That was a great lesson from the call.
Michael: One of the features of our “scale smart” system on which this assessment is built is that it begins with Vision and ends with You. I think those bookends are the two most important. He talked about his top takeaway was being a better delegator and learning to use his team more. I would say, yes, but I would say that has to be preceded by vision, which is where he gave himself the lowest score.
Until you’re clear on what you want… I don’t mean just in the business but for you, personally, as a business owner or a leader. Until you’re clear on what you want, you’re not going to have the motivation, or significant enough motivation to really delegate like you need to, because you’re not really clear what it is you’re trying to create. Once that becomes clear, then the delegation becomes a lot easier. So I think he’s definitely after the right things in terms of what he shared with us at the end there.
Larry: As a reminder to our listeners, you can take the Business Health Assessment right now at businessaccelerator.com/health and get a snapshot of your own strengths and opportunities in your business. So, Michael, Megan, thank you very much for your helpful advice today.
Michael: Thank you, Larry, and thanks for being with us today. Be sure to join us next week when we’ll tell you about what your biggest distraction is, and I’ll bet it’s not what you think it is. Until then, lead to win.