Episode: How to Simplify Systems for Business Growth

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 going to show you how to accelerate the growth of your business by creating a culture of simplicity.

Megan: There is nothing that will slow you down and drive you crazy like complexity. It seems like it multiplies in the dark, doesn’t it?

Michael: It does, and it’s the enemy of speed.

Megan: It is, and it invades every part of your business processes if you’re not careful, from hiring to purchasing to project approval to financial management, and worst of all, it makes you less agile, which really puts you at a disadvantage in the marketplace, especially in our current climate. It can be so frustrating as a leader. That’s why we’re going to dig into this topic today and show you how to simplify and address the complexity that naturally wants to creep in all the time.

Michael: I’m excited about this topic. I value simplicity, although I don’t always achieve it. We have Larry with us as usual to guide us through this conversation, and I’m especially excited today because we have Joel Miller (Megan’s husband) who’s our chief content officer, who has kind of been the champion of simplicity in our organization, and he’s here to represent for the simpler way of doing things.

Larry Wilson: Hey, guys. And welcome, Joel.

Joel Miller: Hey, man.

Larry: How serious a problem do you think this is? We know it’s frustrating when you have to go through some sort of bureaucratic process to get projects approved or to get things moving, but how serious is it?

Joel: Honestly, it’s hugely serious.

Michael: Part of what makes it so serious is it’s so insidious, because the complexity doesn’t happen all at once. You don’t get thrown into the deep end of the pool and everything is crazy complex and everything takes forever and it’s a lot of work to get approvals, but it happens little by little, and it’s always by good intention. Somebody adds this layer of complexity because it’s the answer to a problem they’re trying to solve, but then over time people forget what problem was trying to be solved, and now it’s just a layer of stuff. These things layer on top of each other until you’re tied down, sort of like Gulliver.

Joel: These decisions are usually additive, so they just accumulate, almost like plaque in your arteries, until one day something bad happens.

Michael: You didn’t say anything about my Gulliver analogy. Didn’t you think that was good?

Joel: It’s a perfect analogy. There are a lot of little people doing meaningful things, but it all ties you down.

Michael: Exactly right.

Larry: Chris Zook and James Allen in The Founder’s Mentality say growth creates complexity (that’s really what you’ve just talked about) and complexity kills growth. Can you talk in a little more detail on how this ties you down? What does this prevent you from doing when you have these layers of complexity? Or maybe what do you mean by complexity?

Megan: Well, as you grow, one of the things that happens is your team grows, your number of customers grow, the more components of your supply chain come into play, and all of those things have to be managed. As you’re adding, as Joel was saying, the communication, for example, is not one person to another person; it’s one person to 30 people or 100 people. You need some kind of system for that.

That’s natural and not a bad thing, but the problem is that systems, especially when they’re not thoughtfully integrated or there are too many, can create friction, and that really slows you down. That’s what we’re talking about here: these layers of systems you have to wade through to get anything done. In contrast, at the beginning, early in your business, there just wasn’t much that stood between you and taking action, and now there are all of these things that are in between you.

Michael: Let me give you a concrete example in our business. Back in the old days, five years ago, when somebody wanted to do something in our company, they might just pitch it in a meeting to me or to Megan and we’d give it the green light right there or we wouldn’t, so then they were off to the races. Now, because we’re trying to manage a lot more resources and a lot more people and there’s an organizational impact, we require that people fill out something we call a recommendation briefing form for any major initiative. It’s essentially a proposal. It has the cost and all that.

Well, that takes time, and then they have to get on Megan’s calendar, in particular, to get her approval on it, so that introduces a certain level of complexity. By the way, it’s not bad. It’s a good thing. I think it’s a discipline we’re exercising as an organization, but you get too many of those things set up and you’re going to slow down the organization, you’re going to slow down the speed of innovation, and you’re going to slow down your ability to react to the marketplace. You lose agility in the middle of that if you’re not careful.

Joel: The challenge with any growth of systems like that is they create their own complexity, and complexity breeds complexity. You used the word friction just a second ago, Megan. As friction mounts because of the complexity you’re experiencing, you often then go shift to a simpler, more streamlined but still adjacent system you can use that’s faster, but now you have two systems and that adds more complexity. The more of those elements that are in play with each other, you don’t have simply arithmetic growth; you have orders of magnitude growth of complexity because all of those elements interact with each other in new and additionally complex ways.

Michael: We have an example of where that happened with us with writing software. Initially, everybody was operating in Evernote. We’d write something and we could share a link out. Then some people (I’m not going to say who) started using WorkFlowy, and then some people were using Google Docs, and then some people were using Notion. Before long, you, as an individual (you pointed this out, Joel, in our organization), are having to learn about four or five different systems but not really learn any one system. So now what used to be simple has become very complex, and it just slows everything down.

Joel: You end up having to master software that there’s no need to master, so it just sucks your productivity down.

Megan: There’s no return on that investment at all.

Joel: No. It’s just you multiplying your knowledge across multiple systems instead of everybody getting decently adept at one.

Larry: We have four steps to reducing complexity and creating a culture of simplicity, so let’s get to them. Step one is to develop a mindset of simplicity. I feel like a lot of the stuff we talk about on this show begins with mindset, not just hacks and tips and practical actions. Talk about a mindset of simplicity.

Megan: What we want to create within our teams is a bias toward simplicity, where we just believe that simplicity is better, so we’re always on the lookout for where the complexity creeps in, because it will. It’s kind of like weeds in your garden. It’s not like you’re ever going to root them out completely. They’re always going to be encroaching.

What you have to be looking for is how we can constantly be trimming back and hate complexity, know that it’s the enemy and go to war against it. That requires a lot more creativity and effort on the front end but saves you a ton of time and effort and friction later on, and that’s how I want the people who are on our team thinking.

For example, I don’t want them thinking when we have a capacity issue… When people feel like they have more work than they can accomplish, the wrong solution to that problem as a default is “We just need to hire somebody else,” because that creates more complexity. It takes more effort to manage. There’s more interrelatedness that has to be figured out between different teams and all that. It would be better to figure out what we could do to simplify the things that are creating the capacity strain to begin with. That’s how I want my people to be thinking all the time.

Michael: I think it helps to have models here too. That’s where I think Apple, for me at least, is a great model of simplicity. The thing I think Steve Jobs pushed that organization to do was to constantly take away everything in a feature set until only the essential stuff remained. That’s why Apple computers, for a lot of people (this is an arguable point), are easier to use, because there’s just less stuff you have to master. In the Ken Segall book Insanely Simple, he talks about Apple’s bias toward simplicity. For me, that has been an organizational ideal I want to push for. I realize also, left to my natural state, I will gunk things up. I’ll get more complex systems than we need.

Megan: It’s kind of like your example you shared before about the Apple TV remote compared with the Comcast remote. I mean, how often have you just groaned looking at that Comcast remote? How many buttons does it have? Thirty or forty?

Michael: I don’t know. Thirty or something.

Megan: A ton, and you have to figure out, “Okay. Where’s the volume?” every time. Then the Apple TV remote is tiny, just a couple of buttons. That is a dramatic difference in the simplicity of those two products.

Joel: I learned this as an editor. If you want a shortcut to understanding whether or not an author actually understands what they’re trying to communicate, look at how many words they take to communicate it. Look at how much jargon they use to communicate it. Often, what you find is the wordier, more jargon-filled the text the less the author actually understands his own arguments.

Michael: It’s kind of like that old adage that often happens among preachers where they say, “I’m sorry I couldn’t make it shorter; I just didn’t have time.”

Joel: It’s exactly like that. It’s much easier to just add. It’s much easier to build more into it, thinking you’re adding value, but you’re not.

Larry: So, step one in eliminating complexity is to develop a mindset of simplicity and (I like the way you put it, Megan) a bias toward simplicity. That brings us to step two, which is to get clear on what you want to do. Clarity is a very popular word here at Michael Hyatt & Company. Get clear on what you want to do. Tell us about that.

Michael: I’d like to hear Joel talk about this when it came to our simplification of what we affectionately call our tech stack, the software we’re using in the company, because we were using a lot of different tools to collaborate. When it came to writing software, we settled on something that wasn’t the most feature-rich, but why did we settle on that, and how did you think about that?

Joel: Well, Larry, when you say you have to get clear on what you want to do, that’s exactly one of the reasons complexity develops. People are not clear on what they want to do. They kind of want to do this or that or the other thing. They’ve not thought through it clearly, so they end up opting for just multiplying answers to vague questions instead of being clear. In writing, you have to look at what you really need to accomplish. In our case, we need to be able to draft documents. We need to be able to comment on documents among multiple users. We need to be able to store those documents so it’s easy to find. Honestly, the G Suite was just the easiest answer for that.

Michael: Google’s products.

Joel: Yeah, the Google Doc application. What’s great about that is it doesn’t have to have as many features as, say, Microsoft Word, which is a wonderful program. I like Microsoft Word. It’s great, but I don’t have to format any of these documents on that kind of level, and I don’t have to have those kinds of features. So for the endgame we’re shooting for here, Google Docs was just the much clearer solution.

Michael: That’s a case where less is more. Microsoft Word is very sophisticated. It has advanced features, all kinds of things they’ve added to it, and some would argue that it has sort of fallen victim to feature bloat. I think Microsoft has done an amazing job over the last two years streamlining their tools, making them easier to use, beautifying the interface, and all that, but still, why do we need a solution like that that we’re going to use literally 10 or 15 percent of, especially in a collaborative environment? All that other 85 percent of it just creates more noise and more complexity and more friction for us getting done what we need to get done. Google Docs is simple and easy to use and everybody gets it.

Joel: Absolutely. When you have those extra tools, you’re constantly asking people to go and learn something new. It just deletes time out of their week. Anytime they have to make a decision, there’s a switching cost in the decisions they have to make.

Megan: It’s really true.

Joel: What if you could just give them back that time? They could be more productive.

Larry: Let me make a statement here and see if you agree or disagree. A single-function tool is always a simpler solution than a multifunction tool.

Michael: That’s true, but it also brings with it its own complexity, because now I have to learn how those developers for each of those single tools were thinking, and that can introduce its own complexity. I agree in principle, but I think it depends on the tools we’re talking about.

Joel: I think that’s true too. One of the challenges with a lot of digital environments is that features are not transparent. Let’s say you’re working in a particular program and you’re using it for one particular task and you want to do another particular task. You may not realize the app you’re working in can handle that, and instead you bounce out of that app and go to another app to go do that. Now all of a sudden you’re in a different environment. You’re having to format things differently or think differently or work differently when you could have stayed in the same app and, with just a little bit more familiarity with that program, accomplished what you needed to.

Michael: I want to give you an example of where less is more but kind of in that context. With Microsoft Word, I do a lot of outlining on content, and I can control every aspect down to where the period is placed in the numbering system, all that stuff. My tendency would be to mess around with that and spend an inordinate amount of time doing that when, at the end of the day, that’s not what I’m getting paid to do and nobody cares. I have much less control in Google Docs, so that forces me not to mess around with the formatting. I just write the content, and the outlining is fine.

Larry: So far, in how to eliminate complexity and create a culture of simplicity… Step one: develop a mindset of simplicity. Step two: get clear on what you want to do. Step three: declare war on complexity. That sounds like fun.

Michael: Joel is the master of that.

Joel: Well, here’s the truth. There is nothing that happens in the world unless somebody says, “Hey, let’s go do this thing in the world.” If you have a reality in front of you that you don’t like, you just have to voice it, and I just decided to voice it. As we looked at the array of apps multiplying in front of our eyes like rabbits, I just said, “We have to go kill some rabbits, and we have to kill enough rabbits that we can get control of this thing.”

The tipping point for me was we were using Google Drive to store documents. We were drafting in Google Docs, but then a suite of other products as well, and then Notion came along. Notion is a beautiful app. It’s clear, it’s simple, it looks great, but there’s a switching cost in moving from the array of apps we had to Notion.

Unfortunately, the half-switching cost is even worse, and that’s kind of what ended up happening. We had some people migrating to Notion, but we had other people still using Evernote, other people still using Google Docs, other people still using God knows what. The result was chaos, and I just thought, “We have to take a stand for simplicity here, and we have to root out these other apps.” They’re great apps, but they are just not great for us, as a team.

Michael: Megan, talk about what solution we came up with, the whole idea of there’s a certain specific set of tools we’re going to use to collaborate but people can use whatever they want on their own.

Megan: In the spirit of we want to allow people to have as much autonomy as possible but also facilitate efficient and effective collaboration, we’ve given people the freedom to use whatever they want personally. However, when it comes to documents that are either intellectual property of the company…content creation, visual design, things like that…or when they’re going to be used for collaborative purposes or there’s some collaboration necessary, then they have to conform to a set of tools that are defined for us.

Any kind of document creation is going to happen in Google Docs or in the G Suite. All of our file storage is going to happen in Google Drive. Our project management is going to happen in Asana, our team communication internally is going to happen in Slack, and our email client we’re going to use is Spark. Spark is neat because it allows a group of people, our internal team, to make comments on email messages so we can go back and forth if we’re deciding how to answer someone external to the company, which is really the only reason we use email. All of our other communication internally happens through Slack. It’s really just those things that we’re using.

Larry: Can you clarify about Spark? Is that a stand-alone email client?

Megan: It is.

Larry: You can use it by itself?

Megan: You can.

Michael: Unfortunately, it’s not available on Windows, but it’s the best Mac email client I’ve ever tried. The amount of innovation that company is producing is amazing. Just today, they introduced a delegate feature where you can delegate an email to somebody who’s in the company or works for you. They’re just thinking through it from a use-case kind of perspective that’s really cool.

Megan: For example, instead of forwarding an email to my assistant Jamie and saying, “Would you respond in this way?” and she sends something back with a question, and then I send her something back, and it takes four or five emails before she can answer on my behalf… Let’s say it was some kind of a request that came in or something I was negotiating.

Instead, now, right below the email is a little comment thread, and we just go back and forth, just like in Facebook threads, so it’s very familiar, until we get to the answer right there. We don’t have to leave the client, we don’t have to go send any emails, and then we come to a resolution. She can collaborate with Jim, who is my dad’s executive assistant. It just gives everybody really quick visibility without more email, so you’re eliminating the complexity of all the back and forth.

Larry: I’m really impressed that you knew that release happened today, because I’ve been with you all day.

Michael: Well, in fairness, we had talked about it on our apps podcast, which, as we’re recording this, just dropped, so I heard from the CEO of Spark, and he said, “It’s amazing that you guys are using this. You’re going to love the one we’re introducing tomorrow, which is going to have this delegate feature, so look out for that one.” That’s the only reason I knew it.

Larry: Okay. So a little insider information there. Very cool.

Megan: By the way, Larry, to a more general application, we’re talking about technology as our most recent application of going to war on complexity, but if you’re finding in your own organization that you’re getting constant requests for personnel, which is one of the ways this kind of complexity creep shows up, that’s a good indication that you have some complexity that’s growing over here in the dark and you need to address it.

Usually, when people get overwhelmed with complexity, the most natural solution they can think of is to get more people. Certainly, there are many cases where adding additional staff members is the right solution, but not until after you’ve analyzed the situation and tried to understand if complexity is really what’s causing the overwhelm or if it is truly a capacity issue that cannot be made more efficient through elimination or automation, as we talk about in Free to Focus.

Larry: Michael, you recently announced to the entire company, all team members, that we were going to stop doing some of the things we were doing and reduce the complexity, but it was not so much about tech as it was about product. Do you want to talk about that?

Michael: Yeah. A couple of months ago we had a consultant in, and he asked a very simple question that confounded all of us. That was, “Help me understand the customer journey.” In other words, “What’s the first product your customer should buy or typically buys, and then how do they progress from that into the rest of your product suite?” We kind of all looked at each other and said, “Uh, we don’t know.”

What we did know is that we had probably two dozen different products and various iterations of those products, and they had accumulated for good reason. Every year we introduce a new product. It made total sense. We were clear on the audience segment and all the rest. But as we laid that all out on a graph year by year with how they were introduced, it was overwhelming. Not only were our customers confused, we were confused. We didn’t have a clear answer about the customer journey.

So we said, “Okay. Let’s start at the very beginning.” Vince Lombardi is the one who made famous “This is a football.” So we said, “What’s the football in our business? What is it that we’re about?” We reexamined. We started with the mission statement. We decided what we’re really about is focus. What our content does is help people focus on their goals, focus on their productivity, all the rest.

So we made a very bold decision to retire entire product lines, like 5 Days to Your Best Year Ever, like Free to Focus, and to take the best of that and roll it into a simpler customer journey and a simpler product offering. Out of that came The Focused Leader, and now we have a very simple “point A to point Z” kind of customer journey. Everybody knows what it is. I can draw it out from memory. It’s clear, and it makes everything so much easier. We were doing so many events, so many product launches, so much customer service related to that web of product offerings that it was killing us.

Megan: By the way, we should say, too, for both Free to Focus and Your Best Year Ever, those live on in books now. That was kind of a natural way to retire the course and the live event components of those two products and just let them live on in book format, which is really accessible and kind of a low barrier of entry for our customers and clients.

Larry: In eliminating complexity and creating a culture of simplicity, first, develop a mindset of simplicity. Second, get clear on what you want to do. Third, declare war on complexity. Step four (I think this is where it might get a little harder): prune ruthlessly. Sometimes it’s really hard to let go of stuff.

Megan: I love this, though. It’s like the Marie Kondo of business. If you don’t know what I’m talking about, just Google “Marie Kondo.” Her show is called Tidying Up. It’s on Netflix, and it’s fantastic. It will get you inspired about radical pruning in all areas of your life, but I think it applies to business too. The truth is there isn’t room for sacred cows.

You have to look at your business with objective eyes and not nostalgia, not ego. That is hard, especially if you’ve been around a long time, especially if you’re the founder or are on the founding team. That’ll get in your way, and you’ll end up hanging on to things for the wrong reasons, not because they’re a part of your future but because they were a part of your past.

Michael: This really is a form of hoarding. It’s no different. You can hoard stuff that’s digital. You can hoard stuff that has to do with product, customers… People don’t want to let go of an audience segment because it generates some revenue. The thing I’ve found is anything that’s going to be healthy requires pruning. I don’t care if it’s your hydrangeas or your roses or your business. We have to prune, and pruning is our friend. It’s the key to health and vitality and continued growth.

Joel: I approach this, as an editor (this is my background)… It’s fundamental in writing, in publishing that without good editing you will have bloated, nearly indecipherable texts. What happens is authors (and editors succumb to this; everybody can more or less succumb to this in some ways) develop attachments to ideas, to phrases, to storylines, to arguments that don’t fundamentally serve the endgame, but there is some kind of emotional attachment to it.

When a disinterested third party, in the case of the editor, comes in and says, “That really doesn’t fit here; that really doesn’t work,” they’re serving the universe in cutting that out. The author may have to be talked into it. The author may really object to it, but it’s in service to readers everywhere. There are readers who have read books where they can’t tell you exactly what’s wrong with it, but it’s because an editor didn’t exercise enough, honestly, red-line brutality on the front end. With a little bit of red-line brutality, the world moves simpler and easier.

Arthur Quiller-Couch famously said in his lecture on style, “Whenever you feel an impulse to perpetrate a piece of exceptionally fine writing, obey it—wholeheartedly—and delete it before sending your manuscript to press.” Then he said this famous line: “Murder your darlings.” Just because you love it doesn’t mean it’s good. Just because you love it doesn’t mean it serves the endgame. You have to cut it.

Michael: That’s good.

Megan: Such a great line.

Michael: That reminds me of a quote by the author of The Little Prince. He says, “A designer knows he has achieved perfection not when there is nothing left to add but when there is nothing left to take away.” I think that pretty much encapsulates Apple’s design philosophy. They scrutinize every button they put on a device, because every button adds complexity. That’s why Comcast didn’t exercise that discipline and ended up with this monstrosity of a remote control while Apple ends up with something simple and easy to use that a 3-year-old can understand.

Larry: We’ve learned today that complexity kills a business but nothing succeeds like simplicity. We’ve been talking about, step one, creating a bias toward simplicity. We begin there with developing a mindset of simplicity. Second, get clear on what you want to do; third, declare war on complexity; and fourth, prune ruthlessly. Don’t be afraid to, as Joel reminded us, murder your darlings. Guys, what’s my first step to getting rid of all the complexity in my life? What’s my next action?

Joel: Besides asking whether or not a particular app gives you joy?

Larry: Yes. I meant besides that.

Megan: I would go back to what I said earlier, which is to develop a bias toward simplicity. You want to start training yourself to see things through the lens of simplicity, and when they’re out of congruence you know you have a problem and you need to begin the process of that radical pruning we just talked about.

Michael: I don’t know if this is a law of thermodynamics, but things tend to go from simple to complex. Maybe it’s the second law of thermodynamics, I don’t know, but it’s some version of that. Things tend to get more complex, which means you have to be revisiting this on a regular basis. You’re never going to go through a simplification process and go, “Okay. We have that behind us. We’re done.” Things are going to always get more complex over time, and periodically, just like spring cleaning or cleaning out your closet when you buy new clothes, you have to do this on a regular basis if you’re going to continue to grow.

Joel: The thing I always think of is…Where is there friction in your workflow? Where is there friction in the things you do? Friction is a sign that there’s something blocking your path, and that block may be something needlessly complex. If you feel that blister developing on the sole of your foot, then that’s a great place to go look and strip something out so you can get focused and get moving again.

Larry: Guys, thank you for a very helpful, practical show. Appreciate it very much.

Megan: Thank you, Larry.

Joel: Yeah, thank you.

Michael: Thanks, Larry. Thank you, Joel. Good to have you both with us. Thank you guys for joining us for Lead to Win. Join us next week when we’re going to share seven steps to thinking bigger. Until then, lead to win.