Scaling Your Business for Sustainable Growth: Part 2
Struggling to scale your business effectively?
You’re not alone. Overwhelmed teams with communication and workflow breakdowns can hinder sustainable growth.
Drive transformation by changing your culture. Recognize and reward both problem identifiers and solvers, all while aligning with a compelling unified vision.
In this episode of Cracking the Code, Gary Elekes outlines actionable strategies for building a scalable business, from refining processes to enhancing communication. Start to lay a strong foundation for continuous business growth.
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Audio Transcription (in beta, please be wary of typos)
00:00:00:00 – 00:00:09:21
On today’s show, we’re going to finish up on how to plan for scaling and expansion.
00:00:09:24 – 00:00:30:00
Now, last week, Mr. Gary Alex began the conversation around planning for scaling for expansion. This week he’s going to finish that conversation up. So if you missed last week’s show, go back and take a quick look. It’ll make more sense in the meantime. Take it away, Jim. Fifth item on that list is concise expectations. What? What is my actual responsibility?
00:00:30:01 – 00:00:54:27
So I’d like you to think through this concept. One through five items would be the must do items in, my organization. Six through 15 are going to be the need to do items inside of the organization. And 16 plus is going to be anything we we think we need to be developing, creating or improving, but we don’t believe it’s the immediate priority.
00:00:54:29 – 00:01:18:01
So we create departmental prioritization from the company goals. So this is super important because the top level of the company has one through five. We have the one through five items. We know that. But each department might have some additional items. And we call those departmental priorities. And so we need each department manager to have their specific business plan or game plan for their department.
00:01:18:03 – 00:01:39:13
So an example is the club agreement would be a company rock. That’s a big goal for the business. We want to scale that mountain. We’re at 500. We want to be a thousand this year. We set that target metric at 700 per and we say, okay, great. Each department now has to create their own version of how they’re going to support that.
00:01:39:15 – 00:02:03:19
And that could be wide ranging. So accounting needs its, portion of that. Last week I was in Philadelphia, a company, that had this very same discussion, and it was around the same topic, which was we’re not good at the club program. And our plumbing clubs, are not really people don’t let us schedule them so they’re not getting opportunities to go in and do whole house inspections.
00:02:03:22 – 00:02:22:13
The people will let them do the precision tune ups, but we’re not executing well on the whole house inspection. So we’re missing out on water filtration, on demand water heaters. Just conversations about things that might need repaired. And it’s a it’s a scheduling problem. So the scheduling department, you know, got into the room and we started asking the question, well, what are the problems?
00:02:22:19 – 00:02:52:17
What happens at the departmental level that we can improve this so we can start booking plumbing inspections because we’re selling the club agreements. We’re just not executing. So that’s a departmental problem. And so that becomes a must do item for that particular company. And so we spent about an hour and a half talking through it. And we created a nice plan, to be able to say, okay, fine, this is how we’re going to execute and get people to actually adapt the consumer, allowing us to schedule plumbing visits when maybe we weren’t successful doing that in the first place.
00:02:52:19 – 00:03:16:03
And I can just tell you just highlights. I mean, they were not having daily discussions with the plumbers. They got frustrated. So they let it die on the vine. They weren’t really dedicate, you know, to the success pattern remembered the discipline, the desire to change and the dedication. So they had basically let it die. And so you cannot do that if it’s important to you and it’s on your project plan, it’s a must do item.
00:03:16:05 – 00:03:32:16
I don’t care what we have to do, but we have to make sure we figure out how to get that done. Until we do that, it doesn’t die. It doesn’t go away because we deemed it to be that level of priority to begin with. That’s a scaling problem, and that happens in business all the time. People get frustrated.
00:03:32:19 – 00:03:56:12
Instead of doubling down and figuring out a different approach, they’ll just let it go. And that’s a critical priority that gets us to the next level. The next thing that I’d like to talk about is onboarding sequence. So this company is going to grow to $50 million. So we have a three year. Org chart. And when we reverse engineer that, that’s going to be a whole lot of people.
00:03:56:13 – 00:04:17:26
Now we’re going to improve productivity and we’re going to figure out ways to sell more with the existing people we have. Average tickets will go up. You know, through use of things like data cube and service date and, and sales process. We’re going to have better success and we’ll probably sell more jobs. Current closure rate here is around 40%.
00:04:17:28 – 00:04:35:11
So if we can get that up around 50, 55%, obviously we’ve got the leads, we’ve got the opportunities. We’re going to sell some stuff that doesn’t get us to 50 million. It might get us to 36 or 37 million based on the existing, platform. So we’re going to need more people and we’re going to need to onboard those people.
00:04:35:13 – 00:05:01:13
So when we look at that onboarding sequence, we want to set a calendar of events for each position. This goes back to the role description in number four where we have true understanding of what we want. Having a calendar where we onboard somebody and we get them up to speed faster gives us the opportunity to have a technician, a maintenance technician, a plumber, a plumbing supervisor, a sales professional, a manager.
00:05:01:15 – 00:05:24:11
All of those positions need to have a calendar for onboarding. That’s a huge amount of work. When you talk about the HR function here. We’re squarely in the four disciplines of business right. Finance and accounting. Sales and marketing, operations and HR. Where the four that we talked about this is squarely one of those HR function. So I hired an HR manager, about two years ago.
00:05:24:13 – 00:05:48:25
And the purpose of that function as a manager inside of the management team was basically to deal with number six, which is we not only need to hire, recruit and organize people to be, culturally, formatted for our business and our client experience. But we need to train them and we need to make sure they understand how to actually do the basics of the job.
00:05:48:28 – 00:06:14:13
And so that individual owns this particular process. The third line there that says train you all, that’s actually a software program. And I spoke about this at epic, that we have chosen amongst a variety of cloud based tools. And this is really a video and training concept similar to the Contract university website at Aiga. If you think about what we’re doing here, it’s the same thing.
00:06:14:14 – 00:06:34:14
We’re just doing it for onboarding. So I sat down and wrote the outlines. All the managers contributed. Each of the team members contributed. And so I have that for Hvac and plumbing. I’ve also got it for the agency business as well. It’s a lot of work to break down each of the topics of what you would like to have happen when you onboard a new person.
00:06:34:16 – 00:07:03:15
But the train system allows us to shoot short videos, upload that content, tie it to documents, and it has a dashboard system. And that’s really what’s cool, because the manager check in and review process here allows us to make sure that that team member actually reviewed the information we wanted, and we can sit down and actually have a conversation with them at the end of the day or at the end of the week, and make sure that the onboarding sequence went the way we wanted it to go.
00:07:03:17 – 00:07:38:17
I will tell you that this is cut our onboarding time in half. So by by looking at the train your software system and saying, let’s make the outline and let’s create, the processes around that, the video content, the support for it. We have been able to get people to absorb the information faster. And the manager’s job, working with the individuals when we do check ins and reviews is better at training and coaching and having a dialog about what to do and how to use the information, as opposed to them creating information like I’m doing to you right now.
00:07:38:17 – 00:07:57:09
I’m pushing information to you and saying, you guys should be doing onboarding in this particular manner. That’s a push. Now, if we have this and you can watch the video later, you can absorb that on your own time and then you can come back to me and ask questions. That’s a faster learning model than me just punching content out.
00:07:57:16 – 00:08:19:08
So think about how you’re onboarding as you grow in scale of business, because you’re going to need technicians. You’re gonna need maintenance technicians. We’re gonna need plumbers, electricians. In this company, we’ve got solar. There’s just a wide range of positions and needs to train people to be effective. So think through number six carefully as you think about scaling.
00:08:19:10 – 00:08:39:17
Number seven is then the actual training. So when I have a training platform, that means if I hire a technician there has to be a sequence of events. So I’m going to test each individual, on the contract university site. We’ve got a variety of tests. There’s plenty of tests out there for you. There’s social styles test.
00:08:39:17 – 00:08:58:21
There’s all kinds of different. This profile would be an example. So we want to know about the individual. But we also want to know about their technical competency. And we’re going to create a training plan for each individual that gets them up to speed technically. VR headsets and some of the training that’s going on as part of the EGI platform is state of the art.
00:08:58:24 – 00:09:17:22
Some really cool stuff for us to be able to train people on how to do things. We got to build a tech program now that, will produce a maintenance technician in a two week time frame. We’ve had some success with that, but it all comes back down to understanding onboarding six and then having a training an outline platform for number seven.
00:09:17:24 – 00:09:34:20
And then the manager check in, you know, each week, you know, and the ride alongs that we would do with technicians to make sure that they’re absorbing that information. They’re not going to be perfect employees. In fact, we need to expect that they’re going to make a lot of mistakes, but that’s an opportunity to correct that behavior and teach them.
00:09:34:20 – 00:09:55:04
And then hopefully they just they begin to engage and they get better and better as time goes on. And, number eight out of 12 here is we need a manager’s handbook. So I’m going to I’m going to explain to you how to build a management team. And so as you scale a business, you know, when you’re four people, and you’re in this company, you are the manager.
00:09:55:08 – 00:10:15:15
You know, you got three other people working for you now you’re pushing, you know, 30 million and there’s well over 100 employees here. And you start asking the questions. Well, I got this whole management team. How does that work? How how do we build managers as well as production? How do we build directors and executives as well as managers in production?
00:10:15:17 – 00:10:38:17
So I think you need a managerial handbook. And that’s part of, in our case, train rule. But it also sets up this discussion about how we want managers to lead versus how we want managers to behave, you know, in a daily environment, like what’s their activities? Obviously, if they’re doing a ride along with a service technician or a plumber, that’s going to be some direct coaching.
00:10:38:19 – 00:11:04:15
So this is how you do it. I want you to think about what we call the three M’s of being an effective manager. Now, this is not leadership. This is management. Two totally different disciplines. Right? Leadership is creating the ability for followership, you know, which is the development of trust, the willingness for people to want to fall into line and actually execute what you’re asking.
00:11:04:17 – 00:11:26:16
Management is really thinking about, you know, how to do things in a particular way. So we have three M’s. We call the first one method. Our method is going to be what’s our strategy? How are we going to deal with this. The goal in the sales process today, the method and the strategy is different today than it was three years ago before Covid.
00:11:26:19 – 00:11:50:01
Digital platforms are online. Consumers are probably under a little bit more economic distress today than they were three years ago. Things have changed. So our strategy might need to adjust. So as a sales manager, I have to be thinking about am I doing the right things in this company at a 40% closure rate to be able to achieve a 50% closure rate, given the environment and the change there?
00:11:50:04 – 00:12:07:09
And the answer is in this company. No. And we have to make that adjustment. So Drew Cameron and, and Russ Hawkes, they’re involved here, and they’re starting to work on that strategy. And they’re starting to shape the conversation about is the method. Right. And we don’t think it is. So we’re going to have to adjust that.
00:12:07:12 – 00:12:34:27
Hi I’m Darrell. You shouldn’t ski. Hey I’m Bob Larkin. Many of our contractors meet with us monthly. And you chances are I’ve met with us monthly. We found that members have deeper and greater needs. So we came up with next level coaching, which is we meet a lot more often. And there is accountability to deal with some of the issues of money growth, finding employees, having an exit strategy to get off this roller coaster.
00:12:34:28 – 00:13:01:28
These are the issues the contractors want answers to, and we can provide those answers. The next level coaching. When you join next level coaching, you’re going to find solutions that are easy to implement and logical. Most importantly, we hold you accountable to specifics. We’re going to meet twice a month and have specific to do’s. And with those specific to do’s, we’re going to discuss and dive into your financials in a very granular way.
00:13:02:03 – 00:13:28:07
You’re going to have a clear budget. We’ll be able to establish pricing. We’re going to help you create leadership programs to build your people. We’re going to help you find people. You may think of differing ways to engage employees that will keep them more involved by joining next level coaching. So if you’re interested in making more money, growing your company, finding good employees, and developing an exit strategy, give Dale on our call.
00:13:28:14 – 00:13:52:27
We’ll be happy to talk to you about next level coaching, and we’re going to see you on the next level. Second M is what we call management technique. And that’s going to be the management development of the individual. How am I going to coach this person. You know how am I going to interface. What kind of things can I do to help them learn the skill sets that they need to be a better sales professional?
00:13:52:29 – 00:14:13:29
If the old sales process that we were using in 2018 was working fine, but it’s not working now because conditions have changed. The technique that I use as a manager to train them has to evolve. That could be daily zoom meetings where we’re doing sales management practices. It could be role plays that are now different than what we used to do.
00:14:13:29 – 00:14:34:15
What we we I call those real plays, not role plays. Try to make those as realistic as possible and put them in a situation where we’re practicing minute skills in short bursts, and we refine that and develop it, and we get good at it, and then we put that together in a process that’s an example of a technique, as opposed to just doing one long role play.
00:14:34:17 – 00:15:00:10
And the third M is metrics, the ability to measure specific KPIs milestones and talk about that. I mentioned Data Cube. This company has Data Cube. It as part of its process. Every single department has a set of metrics and KPIs that are public. They’re up on the board. Everybody can see them. And part of the conversation was, you know, the sales professionals, they loved it.
00:15:00:12 – 00:15:23:05
They’re instantly competitive. They want to, you know, win the race. Yet, the other side, there was a department here, and I’m not going to name the department, but they they didn’t like the competition. They didn’t like having that up in front of everybody. And they felt, as if that was, causing them some distress because their information was being made public.
00:15:23:05 – 00:15:39:26
And if they weren’t performing well, they felt badly about that. So I get it. It’s a risk. On the other side of that, the culture of the business is built around the idea that competition is probably a good thing. So we’re going to have to get that team to get over it. And, you know, it’s just going to take some time.
00:15:39:26 – 00:15:59:26
It’s going to take some management technique and it’s going to take some discussions. And eventually they’ll they’ll either get over it and they will improve or they won’t. And some of those people might migrate away, and we’ll have to rehire and retrain and develop people that have that kind of competitive spirit. So number nine, when you talk about measurements and metrics, communications is key.
00:15:59:29 – 00:16:21:12
I’m a big believer in transparency. And I think when you’re scaling a business, if you’re asking me to change my behavior pattern as an employee or a team member of your company, you owe me the transparency of the why. If you’re going back to Simon Sinek and we’re not going to give the Y, you’re going to find some resistance in the Gen Z.
00:16:21:14 – 00:16:43:29
Gen why Gen X and certainly the millennial groups, that’s our workforce today. And they need a strong Y, and they need to understand what the core purpose is. And so when we just try to do things without sharing the Y, that’s not going to be good management technique. As a manager, your technique has to start with the purpose, the Y and make that relatable.
00:16:43:29 – 00:17:05:09
So that the individual understands that the purpose of what they’re doing actually has some meaning that is beyond just making a profit. Obviously, we all want to make a profit. We’re for profit enterprise. But at the end of the day, the profit is a result. It’s not a, a process itself. So we need to make sure we understand the three M’s method management technique really effectively working with people.
00:17:05:09 – 00:17:24:12
And then the measurement process and communications number ten is one that’s a weak spot in a lot of businesses. And that’s okay. That’s part of what GIS for. There’s other member organizations that are out there. I just I’m a believer that we should be a member of multiple organizations. We certainly are, because we want ideas for standard operating procedures.
00:17:24:12 – 00:17:44:19
We want to know and document why we’re doing it. You know, a particular way, the perfect service call, the perfect maintenance call, the perfect sales call. There is no such thing really in life, but we have standards that we’re trying to achieve. And when we achieve those standards, we have consistency. And the word that I would write down around number ten is consistency.
00:17:44:26 – 00:18:09:11
We’re trying to create a business that’s franchise mindset oriented. Standard operating procedures. When we scale a business, allow us to go back to train you all and create training procedures around each role. And as a manager that helps you develop the right culture and performance. Now, number 11, has got a big old list and this is my communication model.
00:18:09:14 – 00:18:28:25
Is that mine? It’s obviously developed over many, many years through the 60s, 70s, 80s. And now we have books like Traction and Scaling Up. And so these are things that we were doing, you know, back in the 70s and 80s. I can remember doing this in the 80s. You know, I was working for Lennox. So a daily huddle, or it could be a bi weekly or a weekly huddle.
00:18:28:25 – 00:18:47:17
Just the idea of huddles where you’re getting your team together for a short burst of 15 minutes to talk about what needs to happen, what are the priorities, what are people working on what we call start, stop, keep conversations? What should you start working on? What should you stop doing? If we’re busy and we can’t take out new customers for whatever reason, that’s a stop.
00:18:47:19 – 00:19:09:12
And what do we want to keep? Be is one on one with your managers. As a business owner, I have one on ones, every two weeks, I meet with, my management team, my directors. We have conversations. That’s their meeting. They have to be able to raise up issues, stuck points. We need to clean off and knock down the barriers for those stuck points.
00:19:09:12 – 00:19:30:03
That’s an important point. Your third one is your management monthly review. I talked about that where I’m literally going to leave this webinar and when we’re done, I’m going to go over to that management monthly review and we’re going to be reviewing accounting, finance KPIs, metrics, project plans and where everybody is in relationship to their project status by department there.
00:19:30:03 – 00:19:47:19
They know that’s coming. That’s part of the reason why I’m here. They’re going to have a big conversation about that, and we’re going to talk through where that status is. And if we have to help, you know, figure out how to knock down some walls. That’s what we’re going to do. But the conversation will happen as part of that monthly review.
00:19:47:25 – 00:20:05:23
And it’s a consistent meeting rhythm. What I see in a lot of companies is when we get busy, this falls off the management monthly, you know, gets punted and we don’t want to punt. We want to review things. We want to make sure we’re on track. We want to constantly challenge the norm, mind for conflict and move it forward.
00:20:05:26 – 00:20:28:27
D is quarterly planning now. We just finished our quarterly planning a couple weeks ago for the second quarter. This is where we review our business plan and we review our quarterly goals. We review our project plans. We go into number C or letter C and we set specific goals. I looked at a couple of budgets from some of the companies that I’m doing some coaching with here.
00:20:29:00 – 00:20:48:29
And I didn’t like the, the trend in terms of where they were in terms of sales, and what they were producing. So we’re going to visit the conversation about maybe it’s time to adjust the budget. We’ve had three months where through March, a couple of weeks of April, we’re not meeting the expectations for the sales and production.
00:20:49:01 – 00:21:08:18
It’s probably time to be thinking about what are we going to do differently. And so we’re going to visit that in the quarterly planning. We’re also going to do an annual retreat that’s once a year where we go away, my end and retreat is going to be in Cayman. We’re going to take our team down there. We’re going to get in a room, we’re going to work, we’re going to go have some fun.
00:21:08:25 – 00:21:33:15
So it’s a combination of of both work flow and having, team building and camaraderie. You know, we’ll probably go see the stingrays, probably go fishing. Most likely we’ll do some boating exercises. There’ll be opportunities for free time you can bring your spouses, etc.. The annual retreat, though, you know, for us is a three day planning mechanism where we write our business plan for the following year.
00:21:33:17 – 00:21:58:25
We’re going to review the historical, but we’re going to look forward as well. We’re also going to have discussions. And when we have discussions, what I mean by that as a team, you know, as part of the management monthly, we’re going to have a weekly management meeting in a department. So each department is going to have that same type of process discussion for service, install, plumbing, electrical, what’s happening, what’s happening.
00:21:58:25 – 00:22:23:06
You know, within the framework of the department, we have a core values dashboard. That’s a communication model that we use. Again, everybody in the company gets an email that notifies, there is a core value story that exists. We read that it reinforces whatever value. It’s all about catching people doing things right. So it isn’t just me or a director catching somebody, it’s everybody in.
00:22:23:06 – 00:22:46:06
The organization has a responsibility to write a core value story. When an employee, a team member does something that demonstrates that core value. So that’s we we see three or 4 or 5 of those every single week. And it reinforces to us what those are about. I would encourage you do an employee survey, and take, you know, some thought processes about how you can improve.
00:22:46:09 – 00:23:05:15
We just did ours. We did two a year. We did our employee survey about communication, leadership and things we can do to improve a lot of good feedback. We treat that as an anonymous survey, just for the record, so people can say whatever they want. Sometimes it’s, you know, good. Sometimes it’s not so good.
00:23:05:18 – 00:23:21:27
You know, we’ve had some we’ve had some, comments that were like, you know, we’re serving the wrong kind of food, gluten, that kind of stuff. So it’s. Yeah, completely unaware that we were doing that. But it was good feedback. Also make sure that you talk about, you know, your employee development plans when you have your team.
00:23:21:27 – 00:23:41:20
In other words, my job is to work with my directors. And I have what’s called a manager once removed as a scaling process in order to develop bench strength. My job is to talk through not just my director, but the manager that’s beneath that director to make sure that everything is going according to plan to develop those individuals.
00:23:41:22 – 00:24:01:01
So as a company grows, we’re going to need the next manager to step up. We’re going to need the next manager to become a director. You have the ability to promote from within, and that creates a better, stronger culture. That doesn’t mean go outside is bad. It just means that we want to look inside first, and we want to try to develop our people from within to create that fiber.
00:24:01:04 – 00:24:26:27
And then last but not least is workflow. I’m using Clickup. As I mentioned, there’s a Sana, there’s Microsoft Teams, there’s Basecamp, there’s a myriad of software platforms out there. But to improve productivity across the company, to improve scale, in other words, to sell more jobs, to install more plumbing jobs, things like Sarah, as a software platform that helps us prioritize the dispatching board.
00:24:27:00 – 00:24:56:07
That’s an example of workflow being reviewed and saying, well, I want to run the most profitable, most organized calls first, and I want the dispatching system to be organized based on my workflow requirements, not somebody else’s. So I can assign those things and I can look at my software, I can look at my training, I can look at my people as all part of the importance of creating a workflow, process.
00:24:56:09 – 00:25:21:05
Awesome content right there. As always, be sure to share this on Facebook. And if you’re not a member, click the button below to get a 30 day free trial. I’ll give you access to all of our amazing content. Well, that’s our show for this week, folks. We’ll see you soon. And till then, bye bye for now.
