G'day everyone, I'm sure we've all been in a spot where we've thought of are we already a leader, how we can become a leader, what is a leader anyway? Is that going to be something that's going to leverage your ability to achieve business freedom? Today, we've got Tim Stokes from Profit Transformations, and he's going to be talking about exactly that. How do you achieve business freedom and how do you make sure that you are a leader, you are developing your leadership skills, and you are continuing to develop leadership in your organisation.
What is leadership?
In your opinion, what is a leader?
Tim: You're a leader when someone is following you because if there's no one following you, then you're just a dictator going for a walk on your own. It's the effect that you have on other people. If you're inspiring people to follow your words willingly, that's what I would call a leader. If people are regretfully, resentfully, slowly or not very effectively following your words, then that's the sign that the leadership skills could be improved.
'If you make your employees happy and fulfilled in their roles, they don't care what you do...they really don't care because they're not working for you. They're working because they're a significant part of the team.'
It's the difference you're making to other people. I believe leadership is one word: servitude. You're there to serve your followers. It's about redundancy. You're aiming to make yourself redundant through the people who are following you, not rule them or dictate them. You empower your followers to be like you. You give power to them to increase their confidence to be able to do what it is that you are doing yourself.
Is leadership a gift or a developed skill?
Do you think that leadership can be taught or is it something that you are or you're not?
Tim: I think we're all leaders. We just probably don't recognise that we are because we all influence other people.
As a parent, you're a leader because your children are watching you, scrutinising everything that you do, copying you, mirroring you, following you, saying what you say, doing what you do and copying your body language. I remember watching my daughter look at me when she was about three years old and she looked at me and then she adjusted her posture. She just copied my posture from just watching me without saying a word, and I watched her do it and then I watched her adjust and I was like, 'Oh, don't do that. Have your own, not mine.'
We're always being watched. Employees are always watching their bosses. If the bosses aren't punctual, the employees think, 'Oh, punctuality doesn't really matter here. That's great. I don't need to be that punctual.' So we're leading whether we like it or not.
I think everything is co-leadership. Sometimes other people lead, sometimes you lead. We probably have a prioritised role of leadership in business, but definitely, leaders are always leaders.
I believe selling is leadership because you're leading people from doubt and potentially resistance or a bit of fear into making a confident decision. When people are in doubt, they need leadership, so selling is leadership to take people from 'I'm not sure what I need to buy,' 'I'm not sure of the price, so I don't have my decision-making criteria,' and 'I'm a bit ignorant of what I'm buying. Someone guide me to making a confident decision and buying.' That is a leadership opportunity.
Every sales phone call, every sales opportunity is leadership. That's exactly what it is, so I think it's everywhere. Everywhere in business is leadership.
'I think everything is co-leadership. Sometimes other people lead, sometimes you lead.'
At home, you're in leadership mode. Sometimes I say the wife wears the pants, but that's not true all the time. It would be alternating leadership because that tends to be how relationships work. We call it co-leadership.
I completely agree with everything you've just said. I think it's important to make sure that you are walking your best step forward for everyone else to follow suit. With punctuality, as you said, it is important to make sure that you are punctual at work.
How can I be a good team leader when working remotely?
You're very passionate, and you've got all those traits, and the business is going absolutely gangbusters. Maybe you're a solo entrepreneur and you decide I'm going to outsource some of these roles and grow a bit bigger.
How do you make sure that your remote workforce sees some of your good traits when you're not necessarily in the office or it's not being completely obvious to them because they only see you for a couple of hours in a Zoom meeting a week or something like that?
Tim: I believe that the emotions that you share with your employees are what they pass on to their customers. It's about being there for them and supporting them. It's about constantly being in touch to show that you care about them and care about the work they're doing. It's recognising and appreciating the work they're doing.
They actually work for you. Even though they might not be in eyesight, they still work for you. I have clients, and their business has grown and grown and they're in other states and have employees in other states and even other countries. I've got a client who took his business into four countries, and it's just a regular contact. Those clients are always talking to their people wherever they are, touching base with them, seeing how they're going, making sure they're happy, making sure their needs are met, etc.
It's not assuming that they are okay on their own. It's actually finding out all the time. 'How's it going? How did you go with the job? Do you need any help? Yeah. Great. Could you do this? Fantastic. Great. Sounds like it went great.' So it's just those regular conversations that I think are crucial.
Leadership v. Micromanaging
In having those regular conversations, how do you make sure that you come across as someone who's appreciative and not necessarily someone that's micromanaging?
Tim: That's really getting the context of what they went through, not just the content. When you start saying, 'Did you do this? Did you do this? Did you make sure you did this?' That's micromanaging.
I love introducing numbers into businesses, one of the eight ingredients that achieve business freedom for business owners. Have numbers for the person to see for themselves that they're doing a great job because the numbers don't lie. The numbers help people to see that they're doing a great job.
The regular communication is great, but when you back it up with the numbers and say, 'Hey, you did an excellent job. You're on that job for two hours. I estimated it to be two and a half. Well done. That's excellent.'
Over time, the numbers can fulfil a person with a couple of other ingredients. When an employee's fulfilled, they need far less supervision. But it's getting them to that stage is what takes a lot of work.
Can you have a successful business if you're not a good leader?
You said earlier that everyone's a leader in some way, shape or form. If someone isn't necessarily willing to step away from the dictatorship style of leadership, is that still going to be a successful business or is it just not as successful? I'm sure there have been some famous dictators in that time that have done well.
Tim: Well, Steve Jobs is a bit of a dictator. He's controlling everything in a way because no one in any department knew what they were working on until the launch of the product. When it all comes together, they finally figure out what they're making, but it's like everyone's sort of locked in a little area. 'Don't talk to anyone in any other department. It's all secret stuff.'
That's how that business was run, but it became the most successful company in the world, whereas Google is the opposite. Employees have half a day off with pay, a community area, etc. Everyone goes and plays pool and play video games and everyone talks to everyone from every department all the time. Yeah, you can be very successful if you're a dictator.
I've had clients that wonder why their staff keep leaving and they go, 'I can't stand staff leaving. I've got to build in some penalties and get better contracts.' I'm like, 'Maybe you need to improve your leadership skills.' So I'm subtly trying to say, 'They're leaving because of you and how you treat them.' But he's looking for tighter contracts because he's too much of a dictator, not enough of a leader. He still had a very successful business. However, if he wasn't there, they used to complain. If he's not cracking the whip, then they're not going to do it.
Yes, businesses can definitely be successful without great leadership. However, I'm about the word optimising and efficiency and taking businesses to an extremely high level. That's a very important ingredient.
How do I develop leadership skills?
Some people are born leaders, but the rest of us are going to figure out how to develop leadership skills by trial and error, by the results that we have and the effect that we have on people. We go 'Oh, okay, let's not say that next time.' You slowly improve your leadership skills from the experience, but we can take a proactive approach to learn this thing called leadership.
It's like most people in sales don't know they're in a leadership role. Give them the good news and say, 'You understand you're in the leadership role.' 'What's leadership got to do with sales?' They're in doubt and they need to go from doubt to confidence. There's a leadership opportunity, the leadership journey, to facilitate and take them from their doubt to the confidence of saying to you, 'Oh, this is exactly what I want.' Getting people to that state of mind where they're so confident that they're asking to buy from you is good sales, and it's actually good leadership.
'Leadership is defining how an employee can occupy the role in the business by knowing the parameters and knowing what the expectations are.'
As a generalisation, if there's a problem in your business and it seems to be consistently happening, chances are it's the business owner that's causing that problem. If you find that people are leaving or that people aren't answering the phone or aren't doing things in a suitable amount of time, even if it comes down to people having more sick leave than usual, it can be something that they might not even consciously be doing. But that boils down to something that needs to be corrected. The ship needs to be steered in the best direction or a better direction to what it's currently going.
If you're trying to teach your staff how to be minions of yourself, mini-mes, so to speak, what is the best way to step away from a bad habit and towards something that's going to be closer to leadership? What's the best way to make sure that you identify and then correct?
Tim: I think a really good thing to do as a touchstone is to understand that it's about context. It's not about content. As a leader, you want to create the context. And it's like saying, 'There's the soccer field, there are boundaries, and here are some rules. Don't play the game.' Leadership is defining the rules and the parameters with which to play the game or how an employee can occupy the role in the business by knowing the parameters and knowing what the expectations are, which is sort of where KPIs can kick in. 'Here's a performance guide. Hit this number and you're doing a great job.'
Getting From Point A to Point B
The road that you follow is not critical, but getting to Point B is. Your Point A gets you to Point B, and leadership is about defining Point B so that the person can figure out their way of getting there by using the parameters which you set and that's where policy is. The policy is like a rule or guideline that an employee follows.
A simple one is to answer the phone after two and a half rings. That's a policy. It's a parameter with which to perform well in your role.
When a business owner gives the clear parameters, which are systems, when you digitise the roll with the parameters and the policies, the procedures are not as important. It's clarifying what the outcome looks like because, in the end, that's all that really matters.
Run Your Business by Numbers
I was fortunate in 1999 to look at the business reports that Rupert Murdoch, the billionaire, wanted from his newspaper every week, sent to him by fax by his general manager. The general manager was showing me this, and he said, 'Hey, come and check out the office.' He's got about 50 staff in there. He said, 'This is all the salespeople over here, the production people over here, all the journalists that are doing all the writing, and then we have the finance people, admin people, etc. These are the reports I have to fax Rupert Murdoch every single week or I don't have a job.'
I started to realise that billionaires run their businesses remotely by numbers, straight numbers. He said there are 23 offices faxing the same reports, so 23 separate businesses every Monday seeing the same reports. And he said we don't talk too much because the numbers tell the story.
That insight was great for me to understand that when you set the parameters up, which is a lot of work, and then you introduce the KPIs that show the outcome that they're aiming to hit from that role, and you have the systems in place for them to follow as guidelines, you don't need to micromanage. If you set it up correctly or at a very high level, that's when you achieve business freedom.
But Setting Up Parameters Takes Time and Hard Work
I wish I knew you were around when I started my business. Back in 2007, when Dorks Delivered was in its infancy and I started off as the cowboy who just went around doing everything that he read online once or had the trial and error and worked out that was the best way to do it. When I got to bring someone else on board, I brought David on at the time. He was going really well. He was working 80 hours, and I was working 80 hours. We're both going gangbusters, but the family wasn't as keen on it—everyone was telling me that I got to balance these things.
Until David had a stroke and ended up in hospital. I couldn't do 160 hours in a week so I went, 'Okay, what can I do here to make sure this doesn't happen again.' I removed onboarding times and started systematising and putting in processes, practices, operating procedures, KPIs, etc. I got our business running to a point where I could step away. His stroke happened in 2012, and it took me until 2016 to be pretty confident in my systems. It took time. In 2018, I was able to step away for 3 months and not do anything in the business.
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Tim: It takes a lot of work. I can shortcut that for a lot of businesses but you know what it's like. I was talking to a client yesterday about exactly that, and we were just guesstimating that it's probably at least 500 hours' work on your business that you got to do to get to that level. It's a lot of extra work, and if you can shortcut it, excellent!
The way I did it was I made a list of the different things that I do in the business—absolutely everything. I got about 500 different things on the list, and then I categorised them. Was it an accounting role, was it an administration role, was it a technical role, was it on the tools? Where was my time going? That was eye-opening. I saw where my time was going and then I started speeding up all the different processes, and I love it. You've got to be passionate about it to be able to move it away from being a job into an investment. You've got to be passionate about it to be able to move it away from being a job into an investment.
Tim: Absolutely. I found that one of the reasons people go into business is they just want a change from doing the same stuff all the time as an employee. I think it's a mixture of ingredients.
People Don't Like Repetition
Tim: One of the most rewarding roles that you can have in a business is being in a non-repetitious space. You set your business up so that you're not dealing with the same customers, which is the production, or you're not doing sales, which is the same stuff. Same problem, same sort of stuff. And you move into that non-repetitious stage and that's where you can occupy different roles.
If you're the business development manager for your own business, that could mean a few things. You could be the product innovator, researching to find new products to introduce into your business that can sell them as line extensions, or you could be going to another state meeting people in your same industry that you're not competing with, having lunches and dinners with them, and sharing ideas and swapping ideas. You can travel around tax deductible and have this great lifestyle and choose when you turn up for work and when you're travelling and having fun and staying home, researching kind of thing. And that's I think a great role to strive for as a business owner, to be in a creative, non-repetitious space. Life's just fun. It's just enjoyable.
Well, the terrible thing is while most people are being rewarded by being paid per hour, most people aren't looking at faster, more effective ways to do things. That is something that I'm really happy we stepped away from, and now we help other businesses step away from that and make sure that they are speeding up their processes.
We don't charge our customers per hour for the work that we do unless we absolutely have to. We normally try and scope it all out and then have a set rate that we're charging them to achieve certain key objectives, and if we don't, then we don't get that money.
It's very important that we set up ourselves like that, and I think other businesses should be doing the same thing. That ultimately has everyone strive towards the same common good. You don't want to have people in monotonous, repetitious work for lots more reasons than just it's boring.
'One of the reasons people go into business is they just want a change from doing the same stuff all the time as an employee.'
If they're doing something that's repetitious, it's something that we'll be able to automate. If it's not us doing it, it'll be someone else doing it. If no one's doing it for them, then it'll be their competitors that are doing it and then they'll be out of business. Any job that is repetitious can be automated.
Tim: Yeah, that time's coming. We'll definitely move in that direction.
Always be learning, and that's the great thing with the BDM role. You're always learning new things about the industry, new ways to talk to people, new ways to become a better version of yourself, and ultimately I guess become a better leader in doing that sort of research.
Do you want to remove repetition so your staff can do more productive tasks they enjoy? Let's have a free discovery session.
What is the most important thing you have learned about leadership?
What should people in a leadership role make sure they're doing?
Tim: I think it's really good to set up a weekly team meeting in businesses. When you set up a weekly team meeting, then you get the collective but you also get the individual at the same time. Listen to a collective and instruct a collective instead of just instructing people one on one or communicating with people one on one. I think that is a huge ingredient that moves people towards that business freedom stage.
And people like getting together and hearing from other people's point of view. That's a method of redundancy. I found that clients that I've set up the weekly team meetings with and then introduce numbers to employees use the word 'love' like 'I love working here since these meetings have happened and we're talking about numbers and all that.'
We might think it's a bit scary to do that initially, and sometimes there is a little bit of resistance from the business owners to do it as well as when trying to get the employees to do it. It takes a few months, but about Month 3, 4 or 5, employees often use the word 'love.' I think that's about as good as it gets kind of thing. 'I love working here. I want to work here until I retire. It's the best job we've ever had.'
It's not changing the type of work they do, but just the environment and culture that you create from that weekly team meeting. They become a team that doesn't work for you, and that makes a huge difference. They don't care if you're there or not because if a person is happy and fulfilled, they don't care what you're doing. If your employees are not happy and you go, 'I'm taking two months off.' They go, 'Why am I still working here?' They have a grudge about it.
'A week is a magical timeframe.'
If you make your employees happy and fulfilled in their roles, they don't care what you do. You can do whatever you like. You can turn up for work or not, and they really don't care because they're not working for you. They're working because they're a significant part of the team. I think a leader can set that up and then create that redundancy, which I think is an essential ingredient of leadership: to figure out how to make yourself redundant in the role.
You've got to make sure you're redundant. We do our best to have a weekly team meeting. I have spoken to other people that have daily huddles, but it just becomes too much and the staff said that they would love a weekly meeting. Can you overdo it?
Tim: Absolutely. I've had hundreds of businesses that I've introduced team meetings to. Those that strive fortnightly don't make much progress. Those that meet monthly don't make any progress, but the ones that do it more often than weekly doesn't achieve a lot.
A week is a magical timeframe. There's a different day in a week, so you can say, 'Okay, last Tuesday, remember when this happened?' So they have a good memory for the events of those five days in that week kind of thing.
You don't need to be more often because you're trying to review how you went for the week. Reviewing how you went for the day is not going to motivate you, but reviewing how you went for a week, it's a significant amount of effort to review how you went from that week's effort. It averages out some of the bumps as well. You have a great day one day, not so good the next day, average day the next day but when you look at the average of the week, 'That's good. I averaged well.'
What does business freedom mean to you?
What does business freedom mean to you or what should that mean to everyone else?
Tim: I think business freedom is a state of mind. It can be a physical thing. I like saying to business owners: would you like to have a business where you can go holidaying wherever you like? I got a client who goes surfing in a remote place in Indonesia for two months, sometimes three. That's business freedom for you.
That's great. As you said, it's different things for different people. But I think most people, as you said, 19 out of 20 would relate to that: wanting to be able to spend time on the things that they care about, be it surfing, painting, hanging out with snotty kids or whatever else that you're doing.
Tim: It's the choices to do what you want, when you want, with whoever you want, wherever you want.
That sounds awesome. I'd love to go surfing for that length of time. I think I'd finally learn how to stand on the board properly.
What is your favourite book on business and leadership?
One last question before we head off. What is your favourite book on business and leadership and why?
Tim: The E-Myth Revisited.
I love it. Michael Gerber. He's great.
Tim: I discovered that when I've been in business for seven years, and then I read the book. I was actually really absolutely shocked and stunned that there's this subject called business and it has got nothing to do with an industry. And that's what the realisation was.
I was like the typical person. I've got to be really good at my job. I was in a trade service business. I was a fantastic climber, great at destroying trees and turning them into mulch. However, I didn't know how to run a business, so that's seven years of struggle and then I realised there's this thing called business. You can learn about this topic.
Then I did the Michael Gerber two-day workshop and that was just life-changing. It changed my whole philosophy, everything about business, because he'd say, why do you work? That's what your business is meant to do. Business works hard so you don't have to. I think that's the best book. It should be compulsory for business owners to read that book when they start a business.
I read it in 2007 and loved it. I've since read it again, and just on 'McDonaldising' your business is a big part of that.
If you are struggling in business, you have some options for people to have a bit of a review and you've got a book that you have on offer at the moment, is that right?
Tim: Yeah, I have a book called 8 Ways to Improve Your Business in 5 Days. It's got eight strategies that you can implement to improve your business in eight different areas like employees, profitability, cash flow, and marketing. It doesn't cost anything to implement the eight strategies, but all of them will make a difference to your business. That's my challenge for business owners. If you're willing to put eight new strategies in your business, I challenge you to make a difference in your business within a week.
It sounds like something no one can lose with.
If you have any questions for Tim Stokes, join our Facebook group and ask any questions that you have for him or go to Profit Transformations. If you have ideas for things you'd like us to talk about, make sure to head across to iTunes, leave us some love, and give us some feedback.
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