106: 5 Keys to Success that Exceptional Leaders do that Spur Growth and Profitability
Michele 00:00
Hello, my name is Michele, and you're listening to Profit is a Choice. Joining me on the podcast today is Eileen Hahn. Eileen is a leadership consultant who partners with organizations to assist them in hiring and leaving exceptional people. Today we'll be exploring the Five Keys to success that exceptional leaders employ. Eileen joined us on episode 50 where we talk about hiring exceptional people. Do you see the connection? Eileen is all about working in and with the exceptional. So grab a pen and paper and get ready for a great conversation.
Every day empowered entrepreneurs are taking ownership of their company financial health, and enjoying the rewards of reduced stress and more creativity. With my background as a financial software developer, owner of multiple businesses in the interior design, industry, educator, and speaker. I coach women in the interview design industry to increase their profits, regain ownership of their bottom line, and to have fun again in their business. Welcome to Profit is a Choice.
Hey Eileen, welcome back to the podcast.
Eileen Hahn 01:11
Thank you. I'm so happy to be here with you today.
Michele 01:14
I'm happy to have you here and I wish everybody else could see us. We actually have our video on so we can see each other but you can't see that we both are smiling ear to ear and happy to see each other. So I'm so thankful to have you here and I think I mentioned it in the intro but just a reminder, if anybody wants to start with the series with Michele and Eileen, go back and look at Episode 50 where we talked about hiring exceptional people. I'm going to say that Eileen's superpower is helping people do things exceptionally not just marginally, not "let's just create a company that gets by," but to hire employees that help the company become successful by really creating exceptional businesses that providing exceptional products and services with exceptional teams.
Eileen Hahn 02:01
That's right and get exceptional results in high organizations. That's not just my business but also what I love to do. I'm excited to be here today to talk to you because I've really thought long and hard over the past 25 years consulting, what makes a company exceptional? What are some of these businesses doing that are really growing and taking off and thriving? What are some key components of that? I am talking with you today, about five of things I've seen, where organizations really grew and profited. It is exciting and fun to do.
Michele 02:35
We're in a time right now, where there's a lot of shifting beneath our feet. We've had a pandemic; we've had social and business issues that we've dealt with. We just have this whole work from home dynamic, we've had our kids home from school, homeschooling or half schooling, and just so many shifts and changes. It is more than we can ever probably remember and with the depth and the breadth that have almost been unfathomable. If we were back in January and February, and somebody told us, this is what you're doing in the year 2020, get ready for what it will look like, I think we would assume that they are crazy. Yet here we are. We've gone through and are continuing to go through a lot. In my opinion, and I'd be interested to see if you're a similar, building an exceptional business prior to March of 2020. It might have looked one way and a little different. This new way of doing things although, still exceptional, there are pivots and changes that have to continually be made to stay exceptional. Meaning what we did prior to all of these shifts may not be the same thing we have to do now. Have you seen some of that?
Eileen Hahn 03:47
Definitely. And that's what I'm working with organizations on now. There are new ways of operating as a business and communicating with our employees, with our customers, and with our vendors. And even our new goals, so when things really hit us hard, we had to re-look our goals and budget. Then we had to look at our staff, how we do our business and conduct ourselves, and how to move forward. I have companies right now that are finding out that their employees are more productive from working virtually, and they're making big decisions to say, "I don't need the real estate of an office or as big an office," or other kinds of different things are coming from these changes.
Michele 04:25
Absolutely. My husband is now working from home and he's made some of the same comments about his staff and company. There was fear prior to COVID that we would lose productivity if everybody is working from home. But what they found is people are so much more productive, because they're not interrupted with the daily small conversation that we don't realize how much of the day it can absorb. And it's good. I'm not saying it's bad, because they still can chit chat through Skype, Microsoft Teams, or whatever it is they're using to communicate. It's a quicker to type and chat because people are starting to have Zoom fatigue, so they're not going to pull up Zoom just so they can chat with you for something that's meaningless. People are able to sit down and focus a little more because there are those that certainly have childcare and are able to really do their work. We are going to see those shifts, we're going to see a difference in commercial real estate as companies start to realize, maybe they can have a smaller presence instead of a larger one. I've been working with companies doing the same thing, especially this mid-year review. Let's go back and look at what was our goal in January. Now, we are going back to, "what's our goal, knowing what we know?" And also looking forward with what we think we know, despite not having a crystal ball, albeit I'd sure like to have one right now. We'd be millionaires if we had. But there are things that we can be watching and learning from, and help us do exactly what you're talking about, which is having these five keys to success. We're not creating these and doing these in a vacuum by not taking into account these months of change, correct?
Eileen Hahn 06:11
That's correct. One thing I like to share with people is that during every economic downturn, there's always a small percent of businesses. I think Harvard Business Review says it's about 14% that actually excel and outperform their competitors and also what they had projected. It's because they really take a look at this up this opportunity to really respond quickly, make adjustments and gain market share. There's a lot of people that froze in fear and they're not making changes. They're hoping things will go back and they won't ever go back. There'll be companies that will go out of business and there are opportunities to gain market share. Kind of start to think of yourself as one of those businesses that wants to take this opportunity, to be one of the ones that flourish, to do some creative new innovative things, and to operate differently so that you can come out right ahead and actually grow the business during this time. As we talk about these five things, that's part of what we want to do. And really, the first of my five is creating a really big bold vision of who you are and where do you want to go? Not just stay in business, but staying in business for what, or where are we hoping to go to in the long term by having a really clear big, bold vision. That gets other people excited about working for you and joining in to help you in executing it.
Michele 07:34
And that ties back into our why. So why don't have a bigger vision than just to make a few bucks and be in business. We're not just doing it just to do it. There's got to be some driving force behind it. What do you find are the elements in creating that big bold vision because some people, especially those that maybe having a bit of trepidation or fear, or feeling like they're trying to get out of the fog. The vision is hazy right now and we need a path and a clear vision. What have you seen, or what are some of the elements of creating that big bold vision?
Eileen Hahn 08:13
Sure. So part of it is what you'd like to see happen in the future, what would be a wonderful, beautiful, exciting future that you want to work towards that's important and meaningful to you. I actually have a couple of different examples I can share with you from the design industry that are kind of fun. When you hear these examples, you're going to go like, "wow, I want to work for them, I want to be a part of that." It's got to be something that enlivens you and also gets other people, your employees, behind you. I had actually talking to a designer earlier today, and she said, "You know, my employees just come and do their job. I don't think they're that excited about growing my business and, trying to help me get new clients." Well, what's your vision? Have you brought them into that fold yet, so that they're excited to be part of that. Let me share a couple different design visions for it with you. Jen Slurs, her vision is to create a better world through the power of design. Inspired interiors vision, is they curate spaces that embolden you to enjoy life in new empowering ways. Blakely Interior Design, his vision is to inspire the world to live vibrantly in their homes and in their everyday lives. That one gets me excited because I'm a really kind of bold vivacious kind of person, so I'm excited about living vibrant, really and energetically in my home and in my life. Again, different visions will actually track different types of people. Browns' vision is to create a memorable brand experience for our clients while enhancing the quality of life for all we serve. So, if you have that in your head, your thinking is, "every experience I'm having with my clients has to be memorable for some reason, so am I doing that or how am I delivering it? How is it enhancing every person's life so the employees' lives are enhanced working there too, the customers lives are enhanced, the vendors working with you have an enhanced experience. So, all of a sudden work isn't just work, and it's just not a job. A task has become a part of something bigger, something that's important, that's exciting. Something that maybe will make people more energetic or enjoy life more, feel more empowered. So that having the highly successful businesses with some kind of vision that's kind of exciting, intriguing, vibrant, and alive that people want to join. It's not something that you just write once and post on your website, you have to have it visible to your employees every day. If they're working virtually, give them something they can put on their desk with your vision because they're a part of making it happen. If it's in your office, make it up and put it on the wall. If it's for you, that solo entrepreneur, put it in front of your desk so that you're working towards it. We all want to kind of utilize that vision to energize us to work and be a part of what we want to create going forward. Maybe today we don't have it but we want it for the future.
Michele 11:10
So good! Working through our why and our vision which are so closely aligned and you know, your mission is your what; how you're going to put it into practice. Your vision is where you want to go and what you want to do and how you want to get there in a futuristic, like you said, empowering way. One of the things that I've been talking about in my Aim with Intent Methodology with my clients is really working through team engagement. And part of being engaged with the team is knowing the mission and vision and getting behind it. Simon Sinek talks about in his Start With Why that it's really, we're not working for companies that make money, we're working for a belief system, we're working for the belief behind the company, and the belief of the company is expressed through those big bold words and that vision. It's not fluffy words that we're just choosing because it sounds good. Those words are chosen with intent. Through my program and your program as well, we help our clients choose those words, and to be very intentional about what they're doing, where they're going, and who they're serving. Also, how they want to show up, what difference they want to make, and what is the transformative opportunity that they have before them? I'm talking to my clients about creating legacy and impact. The way that we are going to do this is by having this very clear vision, for everybody to move towards it. And that's when we start looking at role alignment. If we got people working in our company, and they're rolling into the left, and we're all rolling to the right, we're going to have a drag. We have to bring all these people into the fold, which means your employees should be able to stay the company's big bold vision. If we do what you're suggesting, by buying some paperweight or something fun to put on their home desk so that they see it, they're going to know it. And don't you find that for the clients or the companies that do that, their employees are bought into the belief, they're bought into the vision, and bought into the why. They then know where they fit in the company and why their job and their role matters. They understand the predecessors and the successors to everything that they do. They recognize that by them showing up in a big bold way it will make the big bold vision come to life. We can't show minimally and expect this big, bold vision. We can't, as the owner of the company be the only one pushing towards the vision and everybody else slinking away.
Eileen Hahn 13:38
And also, it's letting them know how do they fit in. For example, if part of our vision is that the company wants to grow to 10 employees or $10 million, or whatever those numbers are, then their employee or team members will have this opportunity to move into a new role or having their job expand. So not only we want you on board with us to create this vision, but we want to see you and where you might fit in and how you can grow and evolve as our vision grows and evolves into larger organization with more people and to create a greater impact. Always having that one on one conversation with the person about how they're doing a great job living the vision, values, operation, and saying, "I see you in this role, where do you see yourself going forward as we grow and expand?"
Michele 14:24
What are your educational goals in this? And what else would you like to do? That's super important, because sometimes, especially if we've never been in large businesses before and when we hire someone in we think that whatever exceptional employee we've hired for the role, we've got the job description, about the responsibilities, we've on boarded them well, but that's not necessarily where they're always going to stay. Sometimes they're going to outgrow that role, just like we would if we were in corporate America, we'd be like trying to move up to the next job. They're going to do the same thing. The beautiful thing about getting them behind this big bold vision, this why and your idea of where the company is going is, they can start to see where they can fit in or when they may see themselves fitting in differently. Now they're empowered because they understand that they can come back, have that conversation and to say, "I really would like to tackle this or take on this or I see a gap here and reach the big bold vision, I'd like to help fill the gap," or when they can help finding someone to fill it. Just the recognition that, we can do better, or we can do different. I knew that empowerment is huge.
Eileen Hahn 15:41
Definitely! So then once you have your vision, right, our next step, our number two is having clear, measurable goals that increase every year in a manner to enable you to reach your vision. I just talked to someone who says, "I'd like to be a $40 million company." I asked, "what are you now 3 million, okay, so if you want to get to 40 someday then let's talk about how you're going to get there." What are your goals this year, next year, right over the next 10 years? And how are you planning to reach those goals? What are your strategies or, mechanisms to enable you to hit those numbers?" The businesses that have been amazingly successful over time set high goals every year. And sometimes I think, as I'm working with them as a consultant, how are they ever going to hit that? Those are tough, those are hard, right? We know for ourselves, if you're setting a goal to increase your business, for example sales 10%, every year or 20%, it's not always easy. Part of what we've learned also is that they have a plan for how to achieve those high goals, but really clear, specific goals on what you want to increase. Not just saying, "I'd like to be a 5 million, 10 million, 100-million-dollar company." You have to have a plan of how to get there from where you are today with specific, measurable goals that you know will help you reach that vision.
Michele 16:59
I agree and one of the other components to me that I've seen with businesses that set these big goals or say they want these big things, is a firm commitment. We have to start with a big vision and it's not enough to just write down a bunch of flowery words that sound great, and that inspire others but don't inspire us. We've got to be committed not only to the goal, but to the process of achieving the goal, which is the hard part. Honestly, the goal was not as hard to commit to as it is the process of achieving it. That's where the day to day comes in. It's similar to saying, "I want to run a marathon." You can't just get up the next day and go run a marathon if you haven't been training. That's a lot of miles to run. You've got to start working up to it, then that dedication to the process of the training program that allows you to run the marathon. That's where the real grit, the challenge, and the injury takes place. That's where the determination comes into play. This the same way in our companies. It's not enough to say, "Hey, all, everybody, here's the goal." We've got to buy into the goal. We've got to be committed to the goal, we've got to do whatever it takes to reach the goal within healthy boundaries. Of course, we've all got to be marching towards that goal and know that they're going to be setbacks, they're going to be difficulties. I found that if we are not committed to the process, that when the first setbacks come and the first difficult, it's easy to go, "Oh, well, I'm changing my mind. That sounded good. But yeah, it's not really my goal, like I'm changing my goal midway." Instead of being committed to kind of fight through with bruises and everything to keep going for it.
Eileen Hahn 18:39
And also having a goal that's specific and measurable on the ways to get there. So for example, if you know what your average sales are and you know how many to get a sale you have to have, you'll know how many inquiries or how many decision maker contacts that will lead to a proposal and how many proposals you have for specific number of closing ratio. Then you're saying okay, "to hit this number of sales, I have to have this many proposals, client visits, decision maker contact, whatever that may be. To hit this higher number, I have to increase this or that. Where is the first initial call going to come from? Social media? Referrals? What are my sources to bring in more of those initial inquiry calls so that they can lead to the next step then the next step? What can I do to refine my proposal ability or my closing ratio to increase my sales? Another avenue is what are our sales drivers if we want to reach a high new revenue goal? If we're looking at increasing our profit, right, then we have to really look at the expenses, some of the returns, and other things that we'll look at when we talk about key performance indicators.
Michele 19:45
Absolutely. And I've just been working with a couple clients over the last week and we've been doing a lot of this same work. I'm really going down and looking at what is your two profit centers for everything that you offer. Who are your top two vendors? Who are your top two clients? Forcing them to go look at the empirical data, not to take their gut feeling because that sometimes your gut feeling says that it's a certain person, it's just that person calls you all the time, not because they are really the one who spends the most with you. We've been going back and really looking, especially when we're going to talk about key performance indicators. Where are your top revenue centers? What is costing you and what is bringing in income? It's not necessarily I want to make more money, so I have to sell X number. It's not a one to one, it might be that I need three, but if I got five then the process would be off the charts because the expenses are not moving up as quickly. So, there's a lot that has to be reviewed and analyzed, and that's why going back and looking at the data. It really has to be in some cases, not to trust your gut on some things but really have to be able to dig into the data, to even know what our closing ratios are, how many inquiries. If we don't even know who we've talked to, and how often we've talked to them, and despite having a CRM, but never fill it out, there is no point. All those things really matter.
Eileen Hahn 21:12
Right. The key performance indicators are the factors that are critical to the success of your business. These are things that, without these numbers, you can't succeed. I look at key performance indicators from a couple different levels. One is some kind of big picture high end for your business. You'll also have key performance indicators for your employees in different roles. So, we're looking at total revenue, total profit, and profit percentage. We're looking at profit margin per job, per product, or per service, and depending on how you look at that, we're looking at revenue by client revenue by product line, or by service and we want to get into the details of, "Oh, I have three major services or three major product lines, or maybe I do small, medium and big jobs." Then you start looking at how much revenue is coming from these three different avenues. How much profit comes through each to help you decide what do I want to grow? Which of these avenues is most successful for me and then you look further into that. What are some of the internal processes that are going on within our business, the percentage of projects completed on time percentage, because again, when things go longer, it actually cost you money, it takes more of your time or people's time, percentage of projects completed on budget, time spent on specific tasks, percentage of proposals to close ratio percent of projects come. Differences on the first install versus having to do redo or restock, the percent of measurements that are inaccurate, what's the loss factor. Is there ordering issues or vendor issues. So, by tracking all those data in terms of internal processes, you can find opportunities there to refine and create more revenue, more profit, or to decide, to get the correct system, the correct person, and make some changes,
Michele 23:04
Also, we all look at the same kinds of things. Another big one that we find is time, i.e. this particular product or service makes me more money, but it takes three times the amount of time this does. That's a huge indicator. When we tie it in to money on this, how much billable time do I have? What have I used and what have I not done? I had a client time in the window coverings industry. She filled out a simple Excel spreadsheet for everything that went wrong on every job. Then she went back to figure out not just what the symptom was, but what was the core problem and what we started to realize was that there was a particular vendor that she was using, and almost every single time things came in, something came in wrong, damaged, missing something, but we would not have seen it that way had she not been keeping up with it in a spreadsheet. Where that vendor name kept popping up over and over and over and we would track back and we could tell that the PEO where we'd order, everything was correct, but it wasn't what came in, or it came and damaged or something was wrong or missing every time. That gave her a good opportunity to realize she needed a conversation with a vendor. And if it didn't clear up, then to go find another vendor who supplied a similar thing. I had another client with the same type of process and he found out that the breakdown in his company was in the work order. There were a couple of key things that were missing and people started interpreting and filling in the information with what they thought, because it wasn't written down. So, we went back and changed up the work order, all the way back to the core of the problem, not the symptom then we fix that process. This information is needed three steps down the line, don't make that person have to either assume it, or go look for it. We lost time, lost productivity, if we're going to do it that way. We had another client that we realized when they were in the work room - this happens a lot, certainly in design as well - but they didn't have their room laid out in such a way that things flowed from machines to machine, from process to process. They were spending more time moving back and forth across the workroom to get and gather things and pull them together, instead of having them ready when they needed it. Those kinds of things cost the company huge amount, even if it's just time and steps. If we don't think about it and the same holds true in design and in any industry, wasted time wasted effort is going to cost us
Eileen Hahn 25:48
Definitely. Look at what's important in terms of your business. What key performance indicators that drive your business, make you succeed, increase your revenue, and increase your profit. We've mentioned a bunch of them. I'm going to mention a couple more areas as well. But just think about what are the most important to you and to your business? Because sometimes for some people, what makes them unique and special is that they are super timely. In terms of deliverance, what we say we're going to do on time or we deliver it on budget. it. Whatever those things are that you're all about, you want to make sure those are your key performance indicators that you're tracking.
Michele 26:30
From my experience, I found that if we have the three to five performance indicators that are our highest level, the more we focus on expands and the more we dial those in, at some point, we don't have to dial those in quite so much anymore. It creates capacity for us to add some different KPIs for a specific time to focus on an area. You can almost choose one or two out of that, take a step back then focus in another area. You're right, there's a long list and that we're going to have a link in the show notes because it can be overwhelming. They have to measure this, this, this, and this and do their work. Instead, choose a few and when you refine them, take a step back, take a deep breath. Not to say you're not going to focus on, but the focus becomes minimal because you fix the process, then you can turn around and choose a couple more to go focus on. So, this is iterative. It's micro definitely steps and I just don't want anybody to go freak out and say, "Michele!! I have to go measure 45,000 things about business??" We're going tell you, you need to measure just not all at once more. Some can also be KPIs that are checked yearly or quarterly. It doesn't have to necessarily be day to day and month to month and certainly for some companies, they may be, but just start somewhere with a few.
Eileen Hahn 27:51
Even annually. If you set the goals and you have some annual measurements that you're going to look at, but you check it in half year and you realize how many missed measurements or how many redos we had, then really look at that process. Or if you didn't realize that you spent so much time in this one particular area. We need to be more efficient there.
Michele 28:14
Exactly.
Eileen Hahn 28:15
And then here are two of my favorite areas for KPIs because I know we all are going to have financial KPIs, some internal processing KPIs, but customer experience KPIs and employee experience KPIs are two of my favorite areas. In terms of customer experience, do you do any kind of rating or evaluation of your customer service? Or do you have your customers reach you online? Do you send them anything to get feedback on their customer satisfaction? One consideration the percent of rework for a customer, customer complaints, customer refunds, customer retention, repeat clients, canceled jobs. So, those are things that you can look at if the customer experience is critical to you. One of those visions you heard was about creating the memorable customer experience. They're all about making sure that their customers are feeling and experiencing positively. And that's going to attract a certain kind of customer. The other thing is do you care about your employees' experience? And if so, are you looking at turnover, employee satisfaction, or absenteeism? Do you how many how many employees have you had with you? I've talked to designers that have said, "I've gone through an assistant a year or every other year seems like I have to hire a new designer." What's going on there is a lot of lost productivity in having to place the ad, screen the people, hire someone, train someone, and then to have them leave over and over again. It takes your time to train. You can sell or execute as much and because of that you want to hire slowly and right the first time, but then you want to take care of the people. You really need to take the extra time to meet, to talk, to nurture the relationship, and to show them that you care and you want them to stay because they're important to the success of your business and they are important in carrying out that vision. Also, you want to help develop them. They don't have to move to a new position. It could just be new skills or new interests or understanding.
Michele 30:27
So, you know them. I've heard it said that employees never leave bad companies, they leave bad managers. They would stay with a company that they didn't really love if they loved their manager. As the owners of the company, many of us are the managers of the employees, and how we treat them and how they treat us by bringing them in early on and have that big, bold vision. Even starting in the interview process or the pre-interview process, some of them will weed themselves out. For example, for me, I get pitches for people to be on my podcast and I go research them. If I look at it and think I'm not in alignment with their vision, I just decline them and say, "I'm sorry, it's not a fit." So, I'm already making judgment calls based on the way that their business is represented online. So, the way that we represent our business already starts to weed the field down for those that might apply for the job. In that pre interview, right in that information gathering phase, we're already starting to, pull in those people that are in alignment with where we're going and what we're doing. But pulling them in is not enough, now we've got to keep them. We are holding the vision and inviting them in to see how it's going to play out and to help move them forward in the company. Nobody wants to be stagnant and just do the same thing over and over. Like you're just punching a clock. That's not undoable.
Eileen Hahn 31:53
Yeah, some people take a job as a means to an end, something I have to do to pay my bills and to support my family. But it doesn't have to be that, it can be something that you're excited to be a part of and that you enjoy and that enlivens you. Then when you come home at the end of the day, you feel good and accomplished. And you have energy versus you're tired, drained, depleted, and you just have to go do it because you have to pay the bills. So, when you hire someone, you want someone that has a reason for wanting to work for your business or excited about your vision and you ask them, "what excites you about coming to work for this organization? What do you like about our vision? How do you see yourself a part of executing something like that?" And then once they're on board with you, having one on one conversations, and really ongoing whether it's weekly or every other week or once a month.
Michele 32:47
When I was in corporate, Eileen, we pretty much got feedback almost once a year. It felt like unless you did something wrong, they pretty much didn't talk to you until review time. That's changed, it's a mistake because you never knew what's happening when you were always waiting a year out. It's almost like never looking at your accounting and doing your taxes. You have no way to refine, no way to change it, and no way to make it better. But now the new model is more of this ongoing interactive performance review so there really isn't this great big performance conversation where you're blindsided with a bunch of information that you didn't know. You started realizing almost these micro conversations allowed you to make micro changes so that things never built up to the point that they did 30 years ago, where you could walk in and just get fired one day and not even have a clue what was going on and not be talked to since the last year. That's just the way it was right? It was very different. So, staying in touch and knowing and having a plan for these conversations, although not everyone has to have a detail and five bullet plan, but a plan to have it as a mid-check in this time. Next time, we'll be a little more constructive or sharing an idea. There is some form around it and an openness for that other person to know they can come to you and that two-sided conversation can go on the entire time.
Eileen Hahn 34:24
Right. So, you want to think about these conversations with your employees as a "we care". It's not so much about the performance conversation. It's "I care about you." When I talk to people about having these one on one conversations, I'll just give you the kind of the real brief overview of the few points you touch on and then also just know that on my website, there's a one minute video that actually explains what these one on one conversations are like. It starts with just how are you doing? It's personal, and exactly what you want to hear. And during these really challenging times that we have right now in terms of business, the economy in the world and health, it's a good question to ask, how are you doing? How's your family? Then let's talk about your work. How's your work going? Asking them to share with you what's working, what's not working, what are their challenges? What do they need help in? And then how can you support them? Those are the basic questions. It's a struggle, right? It's just, how are you? Tell me about your work and how it's going. It is are you meeting your goals and deadlines? Is that working, as we've discussed. How can I help and support you and doing that? Simple and they know that you care.
Michele 35:36
It really is and that's what I mean, to have a plan so that you know what you're doing and if you need to express something, have it ready and available. But having that open conversation is just hugely important right now. And not saving it off for a year to have a conversation that never gets us where we want to go. Your next point was strategic planning every year, so talk to us about strategic planning.
Eileen Hahn 36:08
This is critical, it's a make or break. The companies that are highly successful they do with the companies that aren't don't it's just as simple as that. I mean, every one of my top, you know, most high performing highly profitable, high volume business that's grown is because they take time each year. And they set aside a couple of days. They gather the data, they have key players, different levels of organization, sit down for the meetings, and they review the data. They create two new strategies and plans going forward. They have kind of new thoughts and ideas that they're bringing in to enhance the business and then they're setting their goals. And those goals again, are reviewed, quarterly. There are some things you review monthly or quarterly. The strategic plans are alive, it's not just making a plan and goes in a fire file. It's something you develop with input from employees at all levels filled with data, information, strategy and creative new ideas that come into play because they're brought into it. I would suggest having some outside person facilitate that for you, to help you in that process, to kind of look objectively and also be creative. Then also, your strategic plan could be a three to five-year goals on top of annual plan.
Michele 37:21
I love that. I love strategic planning. To me is the most fun because the strategy is going to fit in with that overall big bold vision. It's going to write the why. Then you dial it down and start creating. You can't just create a strategy without creating the undergirding which is the goals, the details, and processes. We have to have input from everybody at all levels to be able to do that. I think creating these strategies, if we're looking at it just from a smaller interior design firm, it's getting buy in from your people, not just handing them the strategy and saying go execute. It's making them feel part of creating that strategy as appropriate because then they're going to feel like an ownership to that strategy, as opposed to, "look what she's telling me to do now, or, look what he's now telling me I have to do." It feels put upon you as opposed to you feeling a part of it.
Eileen Hahn 38:12
Right. So, it's asking employees, "what creative ideas do you have that you think would grow or enhance our business? What do you think would make us more effective?" That's one of the things that I've been encouraging leaders to talk about with their staff right now as we're going through this change. What new avenues should we explore? Is there a new way of operating that would be helpful to us and our customers? What's your ideas and input? How can we streamline things? To do any more that we used to do that we just stopped doing because we work remotely and they weren't needed and unnecessary. You definitely want to get your employees input into that process. And then share with them, how did it go? What's the plan? What's the vision? Again, it's wonderful to engage your team in strategic planning process to get their input before you start the planning to and then also their creative ideas for strategy how to be more efficient and effective. Then when you come out of the planning process, again, sharing with them what the plan is, and then checking in a quarterly basis with your key performance indicators and your goals. To help you get there.
Michele 39:16
You made a really big point and I want to make sure that we underline it, highlight and put an exclamation behind it, that this is a living document it. It's not one that you write it and put it in the drawer. I've seen quite a few companies that create the strategic plan but what they don't do is as I would say, connect all the dots. So, here's the plan, here's the strategy, here's the goal, here are the KPIs, and we're going to look at it. You've got to have the whole the plan for the beginning of the plan, then a plan for the plan, and then go back and look. When they do all this work, put it in a notebook, come back the next year, and pull out their notebook, it's like you're starting over every time. It's difficult to gain momentum the way you want to gain momentum if you're not actively looking at it. As we've said before, what you look at expands what you and focus is on expands. So, if we are focusing on these KPIs, focusing on the metrics, focusing on the plan, on the big bold vision, we have a much better chance of making it happen than doing it once and kind of taking it out of mind. We tend to do other things and even if we're not ADD, shiny objects, squirrels, we are running after everything versus focus, focus, focus. I just want to make sure that we highlight that, because as you said it, it is easy to say in our mind. Of course, you're going to look at it. But it's about putting time on the calendar to look at it. I know there are plenty of things that I said, "yeah, I'm going to look at it," but I didn't go out and literally put it on the calendar at that moment. I have found now, I'm in my 50s, and I can tell you, I live by that Google Calendar. I mean, it drives my life, because I will forget. It is my Asana task list. If there is something I need to do, it goes in those repositories. I use it to guide me so that I can free my brain up to do other things, because I can't hold it all and I certainly can't hold stuff out six to eight months. And think I'm going to do it. So, do you have your clients try to go ahead and create a day, once a quarter and put it on the calendar. To go ahead and put it on the calendar to do the review and to do the measurements and to look at things, don't just say you're going to do it. Let's schedule it. Is it first Monday, the last Friday? What is it? Let's schedule it.
Eileen Hahn 41:39
My clients will look at the year and they'd say, okay, we're going to do our annual strategic planning, we normally do it this month," November maybe. And they'd say, "we're going to set aside one day to kind of talk about what data and information we want to gather because we want to accomplish it in our two days strategic planning," so they'll schedule those days out. So that's like sacred, because everyone could say, "I don't have time for this." You schedule it and you make the time and then we'd say "okay, we're going to have a quarterly meeting to review all these things our vision or keep our goals, our key performance indicators and check if our strategy still working or not working?" We need to make some adjustments on the strategies, or make some changes. Those meetings are scheduled for the whole year. And then monthly reviews as well with the monthly forecasts where the monthly results and the communication. If you're more goal focused people, these are times to also set goals or more goal focused meetings. Then you get your team all on board with the goals and to focus or communicating that with them. So, you want to set that calendar for the year. I have clients I've been working with for 20 years, and every year I facilitate their strategic planning, we're on the books, it's part of their budget and what they plan for because they know it pays off. So, it's just every year I'm going to come to these meetings, we're going to get have these conversations, and it helps propel their business forward.
Michele 43:10
I found the exact same thing. The more that we strategize, the more we put it on the calendar, the more we commit to the plan. And then to add the details of the plan so the more we actually meet the plan. And when we've heard the goals, written these things down, and we've looked at repeatedly, they're subconsciously working on our behalf to get things done. That's why even when we sleep, we're solving problems within boundaries and goals within whatever constructs we built, because our subconscious still working on it. We can't underestimate the power of the subconscious mind. When we're taking these things in, they don't have to be right in front of us every single day, but it's working. We're trying to work things out to fit within the goals that we've set.
Eileen Hahn 44:10
And our last area honestly, is the make or break, because I can tell you, you can do the first four things we talked about, you don't do number five, no guarantees, because a lot is influenced by really caring about your people. So, having those one on one conversations shows you really care about them, helping them out, understanding who they are on a personal level. You're helping and assisting them perhaps in their personal world or realm as they need it, and kind of going above and beyond for them personally as well as part of your business. I know it sounds strange, because there's lots of people that have this philosophy of there's work and there's business, so this is just business and you're being paid. And yes, there are jobs and companies that operate that way, but the ones that I've seen that are most successful are the ones that don't operate in a way that really care about the person and get to know them. So, let me ask you, if you haven't had a chance one on one conversation with your each of your individual employees in the past month, six months, do you think they think you really care about them? I can tell you that when you do have those one on one conversations, you tell them you care, and you spend extra time with them, you help your employees, you want to do things for them, you want to celebrate with them because you want to make them a part of things. You want to coach them and help them through this troubling time in the world, in the economy right now and to have some good conversations that help them as a family and as a human being. It's going beyond just "I pay you, you work for me," but it's "I care about you." Take extra time for these conversations with your employees that you care about. Those two pieces are going to gets you the long term returns you're hoping for if you help develop the people.
Michele 46:08
So, let me ask you this, where is the line there? Because I've got some clients now that they think they're showing that they care. They thought things were okay and now the employee is taking advantage. They are overstepping the boundaries and pushing things farther than they need to push. Do you know what I mean?
Eileen Hahn 46:33
I know people do that sometimes so what I would want to explore is, do they have a clear job description of what's required? Do they have clear performance standards of what's expected? Are they talking about and reviewing that as a regular part of the process because I care about you and I want you part of our team, but I also need you to care about me and the firm. And if you do, then you'll be able to meet the deadline, show up on time, do quality work, and deliver these results.
Michele 47:02
That's what I was saying. It is as symbiotic. It's respectful on both sides. I just want to make sure that we have to care as the owners and the managers, but it should be reciprocated.
Eileen Hahn 47:14
They have to care about us too
Michele 47:17
Yes, they can't just be one way, and then take take take.
Eileen Hahn 47:22
I totally agree. And also, not everyone's right, for your company, in your position. A part of caring is letting them know if they are the employee that's in a job that requires a lot of attention to detail. If they're struggling, it's hard, and if they're unhappy, it's really difficult for them, find a job that doesn't require this much, so they'll enjoy it more. And they'll be happier and can be more successful. You have these other skills that don't require you to do that kind of detailed analysis, that you will shine with. So sometimes caring is caring enough to say, "I don't think this is the right job or opportunity." I operate at a very high level and I'm always talking about exceptional, but not everybody wants to operate at that level.
Michele 48:12
They don't, they really don't. I've talked to people that were like, "I don't think I can do that." And it might have been I have a couple positions, you got to be really good.
Eileen Hahn 48:26
And you have to care. If you don't, if you're not like minded, you don't have those values, you don't want to live this vision, then it's not the right match. And so, I care enough about you to help you find someplace where you can find the match for you. I care enough to say, "let's just be friendly, but this is not going to be it." And that's okay. So, I so excited about these five things. I really hope that all of you have a chance to go back, think about these and reflect on them in your organization on how they come into play. If you really are serious, want to grow your business, and you have some big goals in what you want to achieve, I can guarantee these are the things you need to do to get there. That's what I see consistently in the companies that are highly successful and that have had tremendous growth.
Michele 49:13
And I would 100% agree with you, the companies that I've worked with that do these things consistently do these things and monitor. They're the companies that are doing the best. They're the ones that have a company culture that they enjoy. They don't feel that sick feeling in the pit of their stomach when they go to work or when they have to talk to an employee. It's almost like a family relationship command. Let's talk about it. Let's solve it together. It's like bringing your employee in and saying we're on the same side of the table. So instead of putting them on one side of the table, and you're on the other similarly to aggressive or opposition, it's we're both on this side of the table and here's what we have to deal with. So even if we are dealing with our client or employees, and we're talking to them remotely, in your mind, put yourself on the same side of the table is their own. It will change your posture that will change your way of talking to them when you're talking side by side versus across the table. Then it's a problem that you can jointly solve as opposed to the other person being the problem. They say that 85% of problems or processes only 15% of problem is people, but we tend to attribute all the problems to the people instead of to a process. That's been a good visual for me for many years is we're on the same side of the table, trying to solve the problem.
Eileen Hahn 50:42
That sounds great. I've always said to all of my leaders that you want to sit in, move your chair to the side so you are sitting next to your person. Don't be in front of the desk and don't be sitting in front of them.
Michele 50:56
So even if this is virtual in your mind, assume that you're sitting beside them. That's a good tip and trick for anybody listening that wants to jump in and start doing some this. Well, Eileen, thank you so much for joining us today. These are some really great steps that will allow us to have exceptional businesses and spur growth. We'll have the link to your KPIs that you're offering to us and also a link to your website in our show notes so people can go find you and connect with you and all the social media channels that you're hanging out on.
Eileen Hahn 51:31
Sounds great. It's been such a pleasure being here with you, Michele, I love to be on your podcast. So, thank you so much.
Michele 51:37
You're welcome. Have a good day. I am so thankful to Eileen for joining us today. She is a super smart businesswoman who brings a lot of joy in life to the conversation. Make sure to grab her download for KPIs in business in the show notes. If you're in need of assistance to create the business of your vision or to create the vision, reach out and let me know. I would love to support you in the Designer's Inner Circle or in my Elite Coaching Program, both using the Aim with Intent Methodology. You can get more information at Scarletthreadcondulting.com. Like we discussed today, exceptional businesses take time and effort, and profit does not happen by accident.