In today’s Brainfluence episode, we have the brilliant and hilarious entrepreneur, Mike Michalowicz, as our guest. Mike has built and sold multi-million dollar businesses, experienced the trials and tribulations of losing everything, and has since become a successful author, speaker, and entrepreneur. His latest book, Clockwork: Design Your Business to Run Itself – Revised and Expanded, is all about achieving true entrepreneurial success by creating a business that can operate seamlessly without relying solely on the owner. In this episode, Mike explains the importance of taking a four week vacation as a test for a business’s ability to run itself, the concept of the Queen Bee Role, and the 4 Ds of building a successful business. Whether you’re an entrepreneur or part of a larger organization, this episode offers valuable insights on how to achieve true entrepreneurial success. Tune in now to learn from the brilliant mind of Mike Michalowicz!
00:00:07 – Roger introduces Mike Michalowicz, a successful entrepreneur and author.
00:00:33 – Mike’s latest book, Clockwork, aims to help entrepreneurs build businesses that can run themselves.
00:00:56 – Mike believes that leaders in larger organizations can also benefit from the principles outlined in Clockwork.
00:01:38 – The acid test for a business that can run itself is for the owner or leader to take a four week vacation.
00:02:20 – When a leader can leave the business for four weeks while it continues to operate effectively, they have achieved true entrepreneurial success.
00:03:29 – When a business doesn’t depend on the owner, it becomes more profitable and saleable.
00:04:46 – Mike shares an interesting anecdote about McDonald’s owners rarely being present in their own stores.
00:06:05 – Many business owners and entrepreneurs find themselves working excessive hours because they can’t delegate effectively.
00:07:26 – Business owners need to shift from a growth mindset, where they put in more effort for more results, to a scaling mindset, where they leverage resources to achieve the same or better results with less effort.
00:07:54 – Mike explains the difference between being a contractor and being an architect in a business.
00:09:05 – Productivity can be a trap if we focus solely on being more productive without considering leverage and efficiency.
00:09:49 – Mike discusses the importance of finding the right balance between productivity and organizational efficiency.
00:11:10 – Mike introduces the concept of the Four T’s: trash, transfer, trim, and treasure, which can help analyze and optimize how time is spent in a business.
00:16:03 – The Queen Bee Role refers to the critical function in a business that must be protected and supported for the business to thrive.
00:18:08 – Mike emphasizes the importance of not hoarding the Queen Bee Role, but rather inviting others to support and excel in it.
00:19:41 – Mike acknowledges that entrepreneurs often play a significant role in the Queen Bee Role but stresses the importance of building a support team to ensure business sustainability.
00:20:14 – Mike explains the four phases of a business: doing, deciding, delegating, and designing.
00:24:05 – SOPs (Standard Operating Procedures) can be useful but may become outdated quickly in today’s rapidly changing business landscape.
00:25:46 – Captures, or recorded activities with voiceover explanations, can serve as more dynamic alternatives to SOPs.
00:27:04 – Mike’s website, Mikemotorbike.com, is a great resource for accessing free chapters of his books and other valuable content.
Mike Michalowicz is a well-versed expert in business studies. He has immersed himself in studying businesses of all sizes and strongly believes in the principle that these enterprises primarily operate on monthly cycles – from revenue generation and service provision, to employee management and book closing. One interesting theory he posits is the unique ability of a business leader to take a four-week break while ensuring the business runs smoothly in their absence. He suggests that if a business runs successfully during this period, theoretically, it underscores that the leader could step away indefinitely. In Michalowicz’s view, this isn’t a mark of redundancy but rather an opportunity to elevate oneself to a more strategic thinking role. His business acumen and insightful theories make him a powerful resource for business leaders and owners.
Full Episode Transcript PDF: Click HERE
Roger Dooley [00:00:07]:
Welcome to Brainfluence. I’m Roger Dooley. I’m excited to have Mike Michalowicz back on the show. Mike started his entrepreneurial career by building and selling not one, but two multi million dollar businesses. He became an angel investor and proceeded to lose everything. That’s an expensive way to learn. But Mike has been sharing smart business sites ever since as an author, speaker, and yes, he’s still an entrepreneur. Mike is the author of Profit first, the Pumpkin Plan, Fix this next and more.
Roger Dooley [00:00:33]:
His latest book is a new, revised and expanded edition of Clockwork Design your business to run itself. Beyond being super smart, Mike is really creative and very funny. Welcome to the show, Mike.
Mike Michalowicz [00:00:45]:
Roger, thanks for that kind introduction.
Roger Dooley [00:00:47]:
I think your book is primarily aimed at entrepreneurs, but do you think that people who are part of larger organizations will have something to learn here today, too?
Mike Michalowicz [00:00:56]:
Oh, there’s no question about it. In fact, I’m working on a new book for leaders. It’s about employee engagement, which parlays a lot of lessons from clockwork. So, yeah, there’s no question if you are a leader in a business, if you run a department, there are ways to build efficiencies that will serve your entire company and yourself.
Roger Dooley [00:01:14]:
That’s a good reason for everybody to stay tuned. Know, Mike, you start off pretty early on by saying that the real acid test for a business that can run itself is for the owner, entrepreneur, founder or leader to take a four week vacation. That seems something that’s probably unreachable. Four. Most entrepreneurs explain the logic behind that.
Mike Michalowicz [00:01:38]:
Yeah, so as I’ve been studying businesses of all sizes, most businesses run on monthly cycles. We have to create revenue, service. Our employees, our clients, close out the books all within these monthly cycles. And my theory was, if a leader can leave the business for four consecutive weeks while that full cycle happens, theoretically, they can leave forever. And that is a powerful way of confirming the business can run in absence of that leader. I also though, as I was studying that, it’s like, oh my gosh, now these leaders, these business owners, will feel that they’re not needed. Like, wow, I’ve run myself out of a job. But in fact, what you’re doing is you’re elevating yourself to strategic thinking.
Mike Michalowicz [00:02:20]:
Most business owners leaders stay doing what they’re doing by hustling and grinding, by being productive on an output basis, not on a considerate thought basis. So what we need to do is get a break from doing activities to the most actually caloric burning activity of all, which is thinking strategically and thoughtfully. Listen not a single business has moved forward without strategic thought. If they did, if you didn’t need to think, we would solve square wheels that just existed. But someone took pause and said, maybe a square wheel is not the best approach. We got to make this round. It was thought that transformed that business, and that’s what leaders need to do. And the only way to get there is by removing yourself from the doing.
Roger Dooley [00:03:05]:
Well, I think, too, by getting to that state, they’re adding a lot of value to the business. A lot of business owners and entrepreneurs don’t really have an exit plan. They just figure, well, hey, I’m doing this. I’m making good money. Hopefully I’m making good money and I’ll keep doing it as long as I can and then worry about whatever happens next. But when you can get to the point where the business is running itself, suddenly you have a business that is potentially saleable, right?
Mike Michalowicz [00:03:29]:
Yeah. And that’s probably the biggest benefit of the business not needing you, is it becomes turnkey. So a lot of business owners think wrongfully that, hey, if I build this business and I see so much value in it, I’m contributing to it so much, the day I sell, others will see the same. But if it’s dependent upon their work, what new owner would want that? Because they see prior owner is asking for money and abandoning the business, and they are the business. So it doesn’t make any equitable sense. So when a Business doesn’t depend on you, it is most profitable. I’ll give you a quick story. I travel like yourself for speaking, and unlike you, I go to McDonald’s all the time.
Mike Michalowicz [00:04:10]:
I’m ashamed to admit it, but I do. So I started a while back, is when I go to McDonald’s. I’d ask the cashier if I could speak with the owner. My reasoning behind this was I wanted to get a sense of how that business runs so efficiently. What I was surprised to find is when I asked for the owner the first time, the cashier said, oh, the owner’s not here. They don’t come in. I asked for the second McDonald’s owner’s not here 50 times. The owner’s never been there.
Mike Michalowicz [00:04:33]:
One time a cashier said, oh, the owner hasn’t been here in a while. But they did come in last week to pick up the money. Pick up the money. I was like, okay, that’s what ownership is. You’re not in the glorified closet. That’s the store manager. What you are is you’re someone who’s thinking strategically? Other acquisitions of locations you’re meeting with corporate to figure out new plans to optimize what you’re selling, new promotional strategies. That’s where the heavy lifting is happening.
Mike Michalowicz [00:05:01]:
It’s not at the floor level. And that’s what our businesses need to do too. We need to get the owner out of doing. We need to get them thinking, and it increases the value. Each McDonald’s location is highly saleable because the owner isn’t working.
Roger Dooley [00:05:13]:
And of course, McDonald’s is a designed business. It’s a franchise that has a whole set of operating procedures to ensure that one person isn’t holding the whole thing up. And if something happens to them, it fails. But I have to admire your dedication, Mike. To visit 50 McDonald’s, interrogate the employees. And you probably even had to sacrifice by having a quarter pounder with cheese and a milkshake while you were there just to appear to be a regular customer. That is true dedication to the job.
Mike Michalowicz [00:05:43]:
Yeah, I threw back quite a few Big Macs.
Roger Dooley [00:05:46]:
My guilty pleasure is actually a whopper. We do not have a Burger King anywhere near us. And I actually do occasionally like that. It is fast food. It’s not fantastic. But I do kind of like that flame broiled flavor. So when I’m traveling, occasionally I will stop at a Burger King. So we’ve covered the two big brands.
Roger Dooley [00:06:05]:
Know, I think too, Mike, it’s not just about the four week vacations. I think that many people, whether they’re mostly in an entrepreneurial environment, but sometimes even in corporate environments, they’re putting in excessive hours because they’re the only ones that can do things. And when things get backed up, they’re putting in the twelve hour days or seven day weeks because there isn’t an alternative. They can’t delegate. They can’t assign the test to anybody else. And to me, that’s as big of a danger as anything else because that’s how people get burned out.
Mike Michalowicz [00:06:35]:
There is kind of two factions of growing a business, yet many of us label what we’re doing the wrong way. Many business owners leaders say they’re scaling their department, scaling their business. The reality is they’re growing. That’s the other faction. You either have a growth approach or a scaling approach. Growth approach is where you put in more effort to get more results. That’s that hustle and grind mentality. That’s where these leaders, I see them working twelve hour days to prove their value.
Mike Michalowicz [00:07:02]:
And you do see results from that because they’re working harder. There’s more output. There’s a cap. You can’t get past that twelve hour limit or whatever. There’s exhaustion and the business then starts to flounder. And God forbid the leader is not available, the business drops. Scaling, as opposed to putting in more effort to get more results, is putting in less effort to get more results. It’s about leverage.
Mike Michalowicz [00:07:26]:
And the leaders who do this seek ways innovative thinking to drive the same or better results they have in the past with less resources. And those businesses now have an infinite potential, they can keep on growing and growing. So be very careful as my word of warning to say you’re scaling a business when you’re in fact growing it. We want to scale, but realize you may be growing and you should be pursuing scaling.
Roger Dooley [00:07:48]:
Mike, you make the point with the metaphor in the book, which is being an architect versus a contractor. Explain that.
Mike Michalowicz [00:07:54]:
Yeah, so it’s a great question. So the contractor is someone who is overseeing the work, is integrated in every step of the motion or action, and they’re in what’s called deciding mode. There’s a Hindu goddess named Kali, and you may not recognize the name, but you definitely recognize the figure. It’s that one female head with eight arms. And that’s what a contractor becomes. Someone who’s doing all the thinking and is task rabbiting to the people. If you’ve ever been in that position where you feel, I can’t get any work done during the workday because I have to tell everyone else what to do, you’re a contractor, you’re task rabbiting, you’re in what’s called the deciding trap. You’re deciding for others.
Mike Michalowicz [00:08:32]:
The architect, on the other hand, is a designer. Architect outlines what we’re looking to achieve, then gives those blueprints to the team to bring it to life. But in the moment, they’re making strategic decisions. Oh, I see the vision. But in regards to what we have going on here, we need to use different materials or structure it slightly differently so there’s tweaks, they move along. That’s what’s called delegation. And a lot of people say they’re delegating when they’re actually deciding. Many people are making decisions for others and they become entrapped in that.
Mike Michalowicz [00:09:01]:
But delegation is the assignment of outcomes. Here’s the vision. Let’s make sure we agree to the vision. Your job now is to help us navigate to that outcome that we’ve agreed upon. And if there’s any roadblocks in the way, navigate around it. We want to be architects, not contractors.
Roger Dooley [00:09:16]:
Another point you make Mike, that I think is really good is that productivity can be a trap. I mean, we all want to be more productive. We don’t want to be wasting time. And we use tools, whether it’s getting things done or Pomodoro or any of these techniques that are meant to allow us to get more done in the same amount of time. But really, that’s kind of a trap because you can only get a certain level of gain from being more productive, and eventually you just hit the wall again. It’s only maybe 20% later. So that’s really the wrong path to go down, right?
Mike Michalowicz [00:09:49]:
Yeah, I got the tomato timer at my house. And productivity, the challenges that would become impacted. When I was writing clockwork, I initially interviewed one of the leading productivity experts in the world. And when I met with him, I said, hey, why is productivity so important? And he kind of did one of those lookarounds where he want to make sure no one’s listening in. And he looks at me and says, productivity is crap. I was like, what? He said, here’s the problem. Productivity allows us take A set of work in a specific time period and squash down the time, meaning get the same output in less time. But what happens is then it builds this gap of freedom, available time.
Mike Michalowicz [00:10:27]:
So what we do is we put in more tasks and then we try to pack that down. So we start overloading ourselves with tasks. When we pursue productivity alone, we become impacted. But the argument then is we don’t want to become impacted. We want to achieve organizational efficiency. It’s a balance by leveraging other resources. So don’t take on more work, delegate more, find the work that we don’t need to do, and abandon the work. It’s really optimization around and selectivity around what we do ourselves and what others do.
Mike Michalowicz [00:10:53]:
And inherently, there’s redundancy in the productivity trap. The day you can’t crank out whatever you’re cranking out, everything comes to a halt because you have this backlog. But if we bring balance and leverage, other Resources, now we have redundancy in place.
Roger Dooley [00:11:08]:
Yeah, I guess it’s like scheduling that.
Mike Michalowicz [00:11:10]:
Roger Dooley [00:11:10]:
Hey, I can fit in one more meeting today. If I do this right, then you fill up all of your 8 hours. So, Mike, assuming that we’ve got some of our audience members who are identifying with this. Yeah, they’re too busy. They are apparently irreplaceable in their current role, and they don’t want to be irreplaceable. They want to be able to at least take a couple of days off if not four weeks. Where does one begin to sort of analyze one’s situation and say, okay, how do I develop a clockwork business? How do I get a business that runs itself?
Mike Michalowicz [00:11:41]:
Yeah. What we’re going to do is we’re going to categorize using a technique called the Four T’s. We’re going to analyze by doing time tracking. I do this once a year. I don’t need to track the time. I work for my work, but for my analysis, I do. So once a year. During a normal schedule, usually over two weeks, I track my time, and I’m consistently confounded by how much I misperceive my effort.
Mike Michalowicz [00:12:04]:
I spend 1520 minutes a day on email responding to readers. I spend 2 hours a day responding to readers. I had that much of a misconception or misperception. So first we analyze our time, then we categorize it using the four T’s. The first T is trash. There are certain activities we do that aren’t necessary and we can just abandon them. Often these are historical things. So one thing that comes to mind for me, I was writing a newsletter for my readers, and it took me about 8 hours a month to write this newsletter.
Mike Michalowicz [00:12:31]:
And one month I forgot to send it out. Just totally forgot. And no one said boo. And I was like, okay. I ran a few tests sending the newsletter, not saying letter, and no one ever said anything. That’s a trashable event. Just because I did do it doesn’t mean I should continue to do. That’s a big time saver.
Mike Michalowicz [00:12:47]:
The second category is transfer. There’s work that we do that we may not be productive at, but someone else could be more productive at it. Specifically, if it’s something that brings them joy. For me, I was maintaining. We have a little office here, ten at my author office, ten folks here. I would do the cleanup. I would clean the toilets and stuff like that, because who wants to do that work? Shouldn’t the owner do it? And no one else in the world wants to do that work. So I thought until Amy came on Board, and Amy said, hey, Mike, I see you cleaning the office.
Mike Michalowicz [00:13:15]:
Do you mind if I do that? I’m like, mind? You want to do this? She goes, yeah, she works part time for us. She says, I got a lot going on at home. Sometimes I’d like to do stuff that’s kind of mind numbing, thoughtless work and just the process. So I actually get a lot of joy out of the disconnect from having to think. I’m like, yeah. And she does an extraordinary job, something that I don’t value, she treasures, and she’s extraordinary at. So I was able to transfer it. We should always be transferring to the optimal person and then trim.
Mike Michalowicz [00:13:43]:
Sometimes you have to do stuff that maybe you don’t enjoy. It’s not your love of your life, but it’s necessary. I got to meet with our team here every week, and it’s important. I don’t necessarily get tons of joy out of it because we have to do some technical stuff and so forth, but it’s necessary. So I said, well, is there a way to do this better? And what we did was we did batch meetings. Now we have a daily huddle. And in the beginning of the meeting, I’m revealing metrics and just getting some feedback. And I can do 15 minutes.
Mike Michalowicz [00:14:10]:
What used to take me 15 minutes times ten people. So I was able to trim the work down and get the same results. The last T is treasure. There’s certain work that gives us joy, and that’s where we should be oriented, because when we get joy from stuff, we excel at it. I love to do three things I’ve identified. I love being a spokesperson for ideas. That’s what we’re doing right now. I love writing about them books, just like you, and I love being the cheerleader for my company.
Mike Michalowicz [00:14:36]:
So those are the three things that represent 80% of my time, and I’m excelling. My goal with my colleagues here is to get 80% of their time in treasure work, and we can be far more productive. The end of the day, our little company, as far as we can tell, outpaces our competition almost on a two to one in revenue. It’s hard to tell with private companies, but just based upon feedback we have with number of employees and the size of the business, we’re basically double the output. And I attribute to this orientation toward allowing people to do the work that they treasure.
Roger Dooley [00:15:04]:
I think certainly, Mike, whenever somebody’s doing something, they are going to be more effective at it. They’re going to be less distracted, less looking for excuses to put something off and do something that’s more fun. So that makes a huge amount of sense. And the fact that you found somebody who even enjoyed cleaning tasks is interesting because I’m sure there are people who love doing, say, accounting work, which is worse than cleaning. One of my nemesis, I avoid it like the plague. If I’ve got to do some invoicing tasks or something, I’ll put that off as long as I can until. Okay, I’ve got to do that now. When it wouldn’t have taken that long had I just buckled down and done it.
Roger Dooley [00:15:42]:
But it’s one of those things like maybe cleaning the office. They say, well, it’s not so bad. I’ll do that tomorrow. So finding those people is a trick. Now, a key concept in the book is the queen bee role. And it sounds like the Queen Bee would be a person in the organization. But that’s not exactly accurate, right?
Mike Michalowicz [00:16:03]:
That’s not accurate. And that’s actually one of the reasons I revised the book was I wanted to address this. There was confusion. People heard this concept of queen bee roll. It’s derived from beehives. When I’m studying beehives, I use a concept called biomimicry. Find something that nature has figured out and translate it into a business or personal application. Beehives are very efficient.
Mike Michalowicz [00:16:22]:
So I said, well, how do we translate this? They prioritize the most important function in the beehive, which is the production of eggs. Their survivability depends on it. Nothing trumps that, not even collecting nectar and pollen. They simply got to make sure eggs are being produced. If they don’t have enough nectar and pollen, some of the bees will actually leave the hive permanently so that the egg production can continue on. Well, in the business, I was like, oh, there’s got to be one critical role, the production of eggs that the business depends on, and we need to know what it is. Now, people get confused. They hear queen Bee, they say, oh, that’s me.
Mike Michalowicz [00:16:54]:
I’m the owner. I’m the queen bee. I’m the most important. It’s not the truth. The most important people or persons are the individuals who are supporting the core function of your business. You got to figure out the core function is, and it’s real simple. First, figure out what your big promise is or your brand. Promise is another way to phrase that.
Mike Michalowicz [00:17:11]:
For example, as an author, I promise to simplify entrepreneurship. That’s my promise to my clients, my readers. FedEx promises to deliver packages on time. Well, for me as an author, I then ask myself, if I commit to simplifying entrepreneurship, what are all the activities that support that? Speaking, interviews, writing videos. Then I ask, of all those activities, which one is the most important? And by definition, there only can be one. For me, it’s writing books that simplify entrepreneurship. They better be darn good books, because if I start writing really bad books, be hard for me to get a speaking gig. I probably won’t get any interviews if I’m writing really bad stuff.
Mike Michalowicz [00:17:47]:
So I got to double my efforts. Now, conversely, if my speaking slips and I deliver bad performances, which I do occasionally, the game isn’t over because the book carries momentum. Now I can flip it and say, I double down on speaking. That’s going to be my QBR. And then the books don’t matter. I better be a world class speaker. I better be the next Les Brown or something. And that’s just not who I am.
Mike Michalowicz [00:18:08]:
So I chose the QBR to be writing books, and I do it now as I scale my business. I now have a co writer, AJ Harper, who works with me, and so I have redundancy there. I’m not the only person working on this. I have an editorial team. I’m not the only person working on this. Back to FedEx. FedEx promises deliver packages on time. They do many things.
Mike Michalowicz [00:18:26]:
They have print shops, they have logistics. They have customer service. FedEx could say, you know what? Of all these things, I would argue the most important is logistics. That’s what gets the packages delivered on time. They can say, you know what? Screw logistics. Let’s make customer service our most important function. If they did that, they could no longer deliver on their promise. The news and the headlines would say FedEx packages lost and missing.
Mike Michalowicz [00:18:51]:
But customer service is answering the phone and really nice about it. They would go out of business because they’ve compromised the QBR. Now if you flip the script and FedEx says, you know what? Screw customer service. We’re going to double down on logistics. Now the headline reads, FedEx not answering phone, but every package delivered on time. That may be a sting to their operation, but doesn’t put out business. A multi billion dollar business will be compromised and go out of business if the QBR is not addressed. But it won’t be permanently harmed if it slips somewhere else.
Mike Michalowicz [00:19:22]:
And that’s true for our businesses, too. If we compromise the core competency, we are done. And if we don’t know the core competency is we constantly kind of just mingle there and we’re never excelling. But if you allow something secondary to slip, it’s not going to burn you as much. So know the QBR. Always protect and serve it.
Roger Dooley [00:19:41]:
Do you find that entrepreneurs typically are serving a big part of that Queen Bee role themselves? And that’s part of the problem?
Mike Michalowicz [00:19:50]:
Yes, they are.
Roger Dooley [00:19:53]:
Obviously, Mike, you have to be a big part of the QBR for your organization, but you found ways to support yourself. I think that undoubtedly there are a lot of folks in a situation where they haven’t been able to build that support team to extend their reach and ensure that it isn’t entirely reliant on them.
Mike Michalowicz [00:20:14]:
That’s right. And then you’re at risk. Because I think of the brain surgeon, their promise is a successful surgery and outcome. The QBR is the procedure itself. They don’t do the procedure successfully or don’t do it, it’s all over. That’s a one person operation. That is not a business because there’s no redundancy. It’s a great freelance job, but it’s not a business.
Mike Michalowicz [00:20:36]:
So for me, I made a choice. I could make this a freelance business and it’s all dependent on me, or I could make this into a true business with redundancy. I’ve done it multiple ways. I have a co writer for my books. I also have derivative writers. So profit first is one of my books. I have now nine other versions of profit first in circulation, profit first for restaurants, profit first for contractors and so forth. And those people are carrying the load of writing about this concept and promoting the concept which elevates the tide and the boats, including my own, gets raised.
Mike Michalowicz [00:21:09]:
So once we identify the QBR, our job as a leader is not to get territorial about it and try to block everyone else out. It’s to invite others in so that there’s protection and redundancy so that it can move unabated regardless of who’s available to participate or not.
Roger Dooley [00:21:24]:
Yeah, that’s a great example, Mike, because it is not a necessarily obvious or logical thing to say. Well, I’ll have other people write books, write my books with my branding. Usually it’s like, okay, somebody’s copying my ideas, I’m going to let my lawyer know, but in this case, it’s a useful brand extension and you’re conveying your ideas to more people and to specialized groups of people. And I presume it’s also driving your core business. So that’s great, but it required some kind of a leap of creativity to get there. So I applaud you. Four. That and another concept that you have.
Roger Dooley [00:22:05]:
I noticed that there are not only acronyms, but there are alliterative ones. You have your four T’s. What about your Ds? Four Ds, yeah.
Mike Michalowicz [00:22:16]:
So these are the stages of a business or phases of a business. Every element needs to happen in a business, but we as a leader need to elevate the highest level. So they are as follows. First D stands for doing a business must be doing work that serves clients and the infrastructural work behind it. 80% of a business’s time or more is spent doing invoicing. That’s some administrative work. The delivery of the service product that’s doing work that must be done, but the owner or the leader must elevate them through the next stages. Next level up is called deciding a necessary component.
Mike Michalowicz [00:22:49]:
But in small dashes, it’s kind of like salt. It can add some good flavor, but you add too much, it kills the entire recipe. So deciding is where I talked about that Hindu gods Kali. This is where we’re making decisions for others. And it’s nice when a new employee comes on board and they ask questions or a learner and you’re telling them, do this, do that. But at a certain point, if they keep asking questions, they haven’t achieved freedom. So we want to get out of that deciding phase, deciding for them, and move to the delegation phase. Sadly, a lot of leaders say they are delegating when they’re actually making decisions for others.
Mike Michalowicz [00:23:22]:
Delegation is not the assignment of tasks and giving direction. Delegation is the assignment of outcomes. It’s an agreement with someone else saying, here’s the outcome we want to achieve. Does that make sense to you and why? Then we have a best practice to get there. Historically we’ve done this. But do you have better ways to do it? Do it your better way. If interruptions or disruptions appear, how are you going to navigate around it? And when they come back saying, I don’t know, what’s my direction? Don’t decide for them. Tell them you hired for that thing on their shoulders, that brain of theirs.
Mike Michalowicz [00:23:49]:
Help us navigate around it. That’s true empowerment. That’s what delegation is. That allows us to move to the fourth and highest level, which is designing. Designing is thought, time and listen, we burn a lot of calories, as you know, thinking. It’s actually the hardest work we can do. It’s strategic thought. It’s these if then kind of statements that run through our mind and we can have a vision for the future.
Mike Michalowicz [00:24:11]:
I believe leaders need to spend a lot more time designing. Otherwise we’ll stay trapped in the historical past, be making square wheels when we could be inventing round ones when we.
Roger Dooley [00:24:23]:
Talk about delegating and such. One thing that you’ll see in just about every book about entrepreneurship and in particular trying to scale a business is establishing standard operating procedures, SOPs, whether it’s Tim Ferriss or any number of internet marketers. That’s what you’re supposed to do, get SOPs and then assign people to do those things. And if one person goes away, just slap the next person into the slot and keep on going. You talk about SOPs, but they aren’t sort of an unmitigated benefit. What are the pluses and minuses of SOPs, Mike?
Mike Michalowicz [00:24:58]:
Yeah, the SOP, of course, is that you have a standard practice for others to follow. The minus is they got to master that process. They got to learn it. Most SOPs sit on the shelf. I remember going to my own publisher, Penguin. I was meeting with my editor and I looked at his shelf in his office. I’m like, what’s that book? I thought it was the Bible covered with dust. I thought it was the original one or something.
Mike Michalowicz [00:25:16]:
And he goes, oh, that’s our SOPs. I’m like, have you ever read it? He said, no. I’m like, oh, that epitomized what happens with SOPs. It’s stuff we write for the shelf Plus. The dynamics of modern business culture is things are changing so quickly. An SOP from yesterday may be overridden by new technology today and no longer relevant. So I think an optimized approach, four modern business over SOPs is what’s called captures. Captures is where you record an activity as your standard operating procedure.
Mike Michalowicz [00:25:46]:
So we talked about invoicing earlier. Same doing invoicing now. I use screen capture software to record the process as I’m doing it. I even have a voiceover dictation explaining what I’m doing and then give it to the next person to replicate. Here’s the key, and this is the biggest thing that SOPs don’t have. There’s a saying that the best student is the teacher. We need to deploy that. Don’t just give someone that video to follow within a week or two of them having this process, make them create a new video teaching the process, because the only way they can be masterful at the execution is when they can teach it.
Mike Michalowicz [00:26:18]:
Once they teach it now, you know they can do it. But also you’ve captured their approach, the improvement to the system. Now you have four new capture. If they elect to leave, use the video to transfer to the next person, for them to learn, for them to teach. And now you’re retaining all that knowledge.
Roger Dooley [00:26:32]:
Yeah, I love that idea. Because often if you or I are explaining somebody how to do something, we have done it so many times, know how to do it so well, that we don’t explain it very well. It’s like we skip over steps that are obvious to us, but to a person who’s not familiar with it, they aren’t going to be obvious. So by having the person who you teach, then teach it. They may catch a lot more of those. Anyway, Mike, I don’t want to take up much more of your time. How can people find you and your ideas?
Mike Michalowicz [00:27:04]:
I’ll tell you where not to go is Mike Michalowicz.com. And while I love you, go there. That’s my website. No one can spell Michalowicz. So here’s where you should go. It’s Mikemotorbike.com. Goes to the same site, by the way, but that’s my nickname from grade school. It’s the only G rated nickname I’ve ever had in my life.
Mike Michalowicz [00:27:22]:
Other ones were not so Internet friendly. So go to mikemotorbike.com. My newest book, Clockwork Revised and Expanded, is there you can get free chapters. All my books, you get free chapters. I wrote for the Wall Street Journal for a couple of years. You can get those articles. And I do have my history of podcasting up there, too. So Mikemotorbike.com – Great.
Roger Dooley [00:27:42]:
Well, we will link there and to any other resources we spoke about on the show notes [email protected]. Slash podcast Mike, been great to catch up. Thanks for being on the show.
Mike Michalowicz [00:27:52]:
Always a joy. Roger. Thanks for having m