The I-Hate-Marketing Approach to Marketing

[Music] hello everyone welcome to the 21 hats podcast I'm your host Lauren Feldman this week Sean busy tells Jay gos and Mel Gravely why he doesn't want his firm Kinesis to be known as a marketing agency part of it is his sense that people just don't trust marketers butan also believes that what Kinesis offers its clients is much more than just marketing hearing that prompts Mel to take us through his recent decision to spend a lot of money rebranding his construction business which he says created alignment throughout the business and would have been worth twice what he paid plus Mel explains how he manages to generate new business without employing salespeople Jay asks if it's still possible in this tight labor market to enforce attendance policies and for the first time in the almost 4year history of this podcast Jay goes extremely quiet in this episode what exactly was that about even in Good Times owning and running a business can be a lonely Pursuit our hope is that these weekly conversations brought to you by our principal sponsor the great game of business will let owners know they are not alone in facing challenges same thing with our daily newsletter the 21 hats Morning Report which magazine named the best newsletter for business owners and which you can subscribe to for free at 21h hats.com where you can also find transcripts of our podcast episodes and lots of other articles and interviews joining me this week on the podcast our regulars Shan busy CEO of Kinesis which is based in Portland Oregon and works with small businesses on marketing culture and strategy Jay gos CEO of the gos group whose companies in Chicago include a picture frame business artist frame service and a home furnishing store at Jason home and Mel Gravely CEO of triversity construction a construction business that is based in Cincinnati the episode is titled the I hate marketing approach to marketing welcome Sean Jay and Mel it's great to have you all here Sean I I wanted to start with you with a kind of a follow-up uh sometime back you told us that you were making some changes to the way you Market your business specifically you brought on a salesperson to do Outreach in a way you hadn't been doing how's that been going yeah so that was what maybe 6 months ago I think something like that you know I I viewed it as an experiment it was a relatively low cost you know he was available to work part-time and I knew him well so I had a lot of trust I would say that it proved a few things and it also um helped me discover a few new things so things that are approved for me were cold email Outreach is pretty much a losing game you know any efforts that he made in that Arena just kind of fell flat relationships are pretty much everything so when he leveraged his Network and he went out into the community and he met with people he knew and asked for introductions that was very effective when he used LinkedIn and sales Navigator and all these other things to try to connect to new people that was a tough rad to Ho so it was good I don't think we're going to continue I think there's better ways to invest our money than that okay we're going to have the same conversation we had six months ago I have to ask the question you have a list of prospects he sent emails as a person gets 50 emails a day that I get rid of in 3 seconds I haven't gotten a letter in I can't remember the last time I got a letter so my question is you got a letter through the mail actual let me explain this that those people that wear blue uniforms to come around Jay wants me to do Direct Mail basically just not I I I don't even want to call it direct mail I want to call it a selective pick out 50 great targets get beautiful stationary and send a letter saying hey I've watched your company for years and I've always admired your blah blah blah I'd love to be able to talk I think not think I am confident the person will get this envelope they will open it they will read it and they will think about it and perhaps call you 10 times 100 times more than getting a cold email and I I still believe that is worth trying because I believe if you send out 50 of those you'll get a few people to call I do believe that I think it's worth thinking about you know it's um I'm curious what you thought of the invitation I sent you to Catalyst Jay um it was an emale right no it was a mail it was in the mail yikes okay how long ago was that how long ago was that a month ago it was probably a month before the event so I want to say maybe two months ago okay I can't remember yeah two months ago you should have asked me a few days later I and I know you so that's not a fair thing well well but I guess my point is you know me you actually if of anybody I would have thought you would pay more attention to it well I probably did at the time you probably didn't get it it's my point it's really hard to get the stuff in the hands of people because there's so many intermediat wait wait what do you mean I didn't get it you think someone that works for me to yeah no that's not I can tell you absolutely not I open the mail myself it's my one little fun thing of the day I go through the mail the checks out no I go through the mail myself maybe it didn't arrive I think that's possible anyway my my point being is that I it's it's harder than you think you know for lots of reasons especially with remote work and all that stuff you know do I mail it to the person's office do I mail it to their home you know and I got to pick my battles right you know I can't do everything well let's go back for a moment to your sales experiment yeah you made it sound like you know you eliminated the cold Outreach that didn't work but it sounded somewhat encouraging on the other side building on relationships and yet you're not planning on extending the 6 months why not I I think he's the wrong person for the strategy that is effective there so what I mean by that is Rob is where he did add a lot of value is he went through our CRM he cleaned up all the bad data in there he put together a process of Outreach to past inquiries past customers you know he's very systematic which I value and is is really good for sales but that is not the same person who really loves to go out into the community and kiss babies and shake hands and I've come to the conclusion that what I need is that person if I'm going to hire a salesperson and that's what I've had before in the past you know when I had my prior business development person for 10 years she was a consumate connector everybody knew her everybody loved her and so Rob's a great guy he performs a very important function in the sales world I actually think he would be very successful if he were managing a person who really enjoyed that kind of kissing baby and shaking hands okay so I just need to challenge that thought process so you're telling me taring 50 people and W same letter to most of them wait is it's harder than hiring somebody interviewing them training them paying them a big money really that's that's harder than what you're talking about I that's just ridiculous you're going to go hire someone now and pay them a lot of money and send them out there and not maybe try we're not we're not hiring somebody else Jay I'm just telling you the difference between this experiment and what if I were to hire somebody what I would be looking for and the difference between the two okay I'm just saying the phrase I can't do everything I think sending out 50 letters to people that you've already got on your mailing list you've already know who they are maybe they came to your think and just appealing to them personally here's my card give me a call I think is well so instead how about instead of like debating tactics um you know we can just talk about what I am doing instead because you know as a small company I I can only do so many things and I think this is the trap a lot of people get caught in is they try to boil the ocean especially when they're a small business so what we are doing in L of Jay's Direct Mail Outreach which is still totally viable Jay and I may try it at some point but we're doing um we're calling it 100 105 so we're basically taking the entire company and everybody's activating their networks reaching out to customers friends anybody we have a relationship with we're having meetings with them and essentially we're asking them for introductions and connections to people who may be able to use Kinesis services so the idea is we want to have 100 conversations in a 100 Days with the goal of having up to five new customers so that's that's the effort we're pushing on right now and that's a lot of work but it's actually already yielding great results how are you selecting the people you're reaching out to yeah so we went through the CRM we went through you know everybody who's ever been interested in us everybody anybody who's ever been a customer cuz you know past customers are a great source of introductions in new business right we're targeting people so folks who we look at you know to J's Point who would be somebody that we would really like to know or could be a customer and then we're looking into LinkedIn and saying well who might know that person who could make an introduction that's a friend of ours customer Etc okay so you could say Jay I agree that I've got this great list and I agree that could work but is even better rather than sending them a letter we're actually going to call them and okay I can't argue with that okay sure that's better okay no argument that's better you know this is my first time in this environment and I and I'm like wow are there ear quotes are there ear quotes over that environment thing yes yes yes so I Sean I don't know your business at all what you it all sounds rational to me even Jay's strategy sounds rational I I can if I could put on my uh PhD Professor hat and and I'm a former uh professor of marketing and Entrepreneurship I would say that the most important thing about the combination of sales and marketing and we mixed that word together today and I do think they're different is consistency over time so whatever the strategy is be committed to it over time even when it appears it's not working it's the replication of the same model over and over so whatever you pick that's close to the definition of insanity though isn't it Mel yeah well you got to but here's the thing about marketing it it's got to think about when you go to your mailbox and there's a tree service advertisement in the mailbox you don't have a tree problem so that tree marketing didn't work so they've got to do that often enough so that you remember their brand and they've got to do it uh consistently enough that when you have a tree problem you're a day or so away from getting another ad about a tree service because then it activates so people can be getting great marketing data and just not be in that place right then but if they get it consistently enough when they are at that place they can then activate on it so that's that's all you know what that is an excellent example and I have a lot of trees in my on my my house and I have to tell you you know what would be really smart of those guys when they come out and do the work take a label with your name on it and say hey do you mind if I put this up on your garage I go yeah sure and that way the next time I need them I don't have to go looking for their name it's right there in front of me but they never do that that would be really smart to do get your name there the garage door people do it the uh hbac people do it so Lauren that's what I meant by the continuity of it again that's theoretical and I didn't drop down to whether it should be a mailing or not I will say though the ones that get through to me are the handwritten notes if you write me a handwritten note my staff I I don't open the mail so I could lie and say I do I don't but all the handwritten notes get to me even the ones that are angry males get to me yeah and I m I I agree with you a th% and and you know since you don't necessarily have the full context the kind of constant drum beat prior to the pandemic we had that going on you know and we had it going on on several levels so we had a constant drum beat of speaking and workshops that was largely me we had the constant drum beat of Allison networking connecting meeting people making friends kissing babies shaking hands we had sort of a kind of a constant drum beat of recurring communication to folks who sign up to our newsletter and so forth and you know that put about I don't know 10% growth a year into the company very reliably like you know you could like set your watch by our CRM and inbound inquiries and conversion rates obviously in-person events were disrupted quite a bit in the pandemic and that was a tough blow so we're getting back I think to the fundamentals of what we did before I wanted to try something slightly different with this guy with with Rob um that was more of kind of a cold direct Outreach and and you might be right in terms of like that process could work if I gave it another six months to a year I just want to put bets in other areas well six months yeah 6 months to me is long enough on the strategy like that I wasn't questioning your strategy at all I just I was uh commenting at a much higher level Sean cuz I believe everything you're doing is exactly right Jay's wrong Mel we got to have you back man I I think listen Mel you said it all get a handwritten car a handwritten note tell me if this isn't true when you get an envelope that's handwritten it's either the Lady or the Tiger it's either you are the greatest company ever I love you and I want to thank you or you are the worst and I don't get many bad letters I can't think of the last time I got a bad letter but it always makes you stop okay here we go and you open up the envelope so it makes you think Sean the other piece of context that Mel may not be completely aware of is that as you've explained to us previously you've kind of had a LoveHate relationship with marketing and you've gone back and forth a little bit in terms of how you want to pitch what you do you don't like to sell yourself as just marketing you like to take a more holistic approach and you know look at how a company operates uh in total how are you addressing that now as you do this outrage over 100 days what have you decided in terms of how what what exactly you're pitching yeah I mean I'm probably a guy who knows marketing who hates marketing I mean just just in terms of like how it's normally practiced it just drives me crazy as a discipline I I think there's so much snake oil and salesmanship in that discipline and I also think that you know it is it is is very complicated as a as a domain meaning that if you send your kid to school and they take a you know class in marketing or get their degree in marketing the kind of stuff they're going to learn it it it does not apply to our clients I mean 90% of it it doesn't apply to small business it very yeah yeah exactly so I I found that like when I would go to a party and somebody asked me what I do if I say the word marketing most people like that ends the convers ation so like like literally seriously yeah seriously oh I totally understand what he's saying absolutely I've been thinking that ever since College like oh you're getting a huh what is that no I I think you're right well that one of two like maybe in your your era they didn't know what it was in my era it's a distrust it's a it's a like I I don't you know it's not Universal it's probably 8020 20% are you pick up on that subtle passive aggressive my era your era I I I literally was going to call that out I was like wow yeah yeah all right excellent all right I'm just glad I want you to get the rules of the game here there yeah oh man no well I just I mean you you were talking about how people didn't understand you and I would just say my experience is different in that they actually tend to like they stop the conversation because they're not interested and and I found that really interesting and and I think that's because there's so much marketing going on around us and some of it doesn't live up to its promise that we just have a hard time with it so I have an inherent frustration with marketing right in that most people are especially in the B2B space I'm in the B2B space they are even more skeptical my clients are often Engineers you want to talk about a customer that doubts marketing more than anybody else it's an engineer sure so what I realized in looking at my clients the ones who are really winning at the end of the day I mean just killing I realized that what we're doing and you will like this word Jay is we're helping them gain alignment across their organization right so the culture believes in what they're doing the culture is amplifying what they're doing the employee retention is really high people want to work for that company right so that's on the inside and then the outside the customers are getting a great experience they can't get anywhere else so they become a word of mouth for you so if you just say marketing most people are going to think oh do you do AdWords it's like oh God you're killing me here you know so here's this here's the hidden truth the marketing industry is designed to to sell marketing services to marketers within large companies like full stop that makes perfect sense it's a silo right so you have an agency that does digital advertising you have an agency that does branding you have an agency that does content marketing they want to sell their siloed services to an internal marketer who is siloed that marketer probably doesn't have a lot of influence within the leadership team which is why they got fired in the recession and so they're working with silos of activities it's totally ineffectual but when the economy is good people don't look at it and they just kind of keep cranking the wheel um Mel I'm kind of curious what your perspective is on this well I I tell you Sean you are you have nailed your value proposition though be you have also nailed the Dilemma B2B I run a construction company full of Engineers 100% stock full of them and we just went through a rebranding exercise and when even I heard rebranding I was unsure what my team meant and what it did though is it aligned Us in the organization around our value proposition Clarity around our purpose and values how we talk to prospective clients core competencies all of those things came out and it was so much more yes and we changed our colors slightly and we made our logo lowercase and it looks much nicer but that was after we did all the other work and it took nine months of and a lot of money uh but if you said to me Mel would you spend twice that much to get it don't tell the consultant but I would because I see the company moving but the here's the challenge though it is so freaking hard to articulate that value proposition position ahead of time unless I tell my peer another CEO let me tell you what it did for us and let me tell you who did it for us and that to me is that that's the Breakthrough I mean the consultant we used was amazing they were the most expensive of the three we looked at and I I just wouldn't have it any other way so I think you're dead on track on articulated it's just hard hard to articulate I'm really curious about this why did you hire the most expensive one well we went through an RFP process right not a bid process I want to be clear about that they all gave us pricing but but it we weren't ever telling them we were going to pick the lower bid but they they had the clearest process they were able to articulate that process and and why it was so important to the outcome and they would not accept a a refresh they said no we we don't want your 50k to do a refresh cuz you're going to be mad at us so if that's what you decide we'll pass and that made pause yeah wow that's a good story Sean you've answered part of my question you've explained what you hate about marketing and what you really want to do but you haven't really said how you're pitching this now during the 100 days yeah appreciate that so in looking back at our customers the ones like we literally have clients that have been with us for a decade and I just the other day cross the threshold of a client spending what would that be seven figures with us over a lifetime so the lifetime value of our customers is very high and I as I had to ask myself the question why do they keep coming back right why do they keep not just doing like a $50,000 oneandone thing like literally $200,000 a year year in year out and I started looking at it and I was like oh it's because the return on that is like $10 million you know I I just started seeing like these either slopes of growth or or a client that because they're a magnet for talent they're not paying recruiters a single dollar right these large companies are calling them to hire them they're not they're not doing digital advertising they're not paying for customers and I'm just like oh of course because $200,000 to get $10 million is a really good deal and and so the the the the piece that I'm talking about now is the 10x like what is the thing we can help you do that's a 10x impact and I'm that's the impact we're having on our clients that are really investing in us they're seeing these returns around culture and around customer acquisition that are not linear like you would see with traditional marketing because traditional marketing is a linear output usually right it's you do AB testing with digital campaigns you you get 5% better you know you have a linear Improvement this is like an exponential return and so I have to tell that story aren't you running the risk of sounding like uh just another marketer by when you start talking about 10x doesn't it sound like potentially over promising I mean except I can back it up like I have the financials I have the retention rates you know I have the I I have the data because we when we start working with a client we're we're not just collecting their marketing data we're collecting their full business profile like their p&l you know Revenue margins customer lifetime value so some of this stuff is marketing stuff but a lot of it is like high level what does the business owner care about and then we can like demonstrate that change just to be clear you're talk and Lauren I think this is what he's not suggesting correct me if wrong you're not suggesting they're going to have a 10 time sales revenue you're just saying for what they're paying you they're going to get a 10 time return and as an entrepreneur I would buy that I don't buy when I get these emails every day we're going to get 10 times your profit I'm think are you sir you don't even know anything about my business but but the 10 times what you pay okay that's believable or what is the thing what is the thing we can unlock in your organization that leaps you forward right and that can be new product offering you know something you've never sold before that is potential but you didn't realize you had it within you Mel you will appreciate this I literally had an HVAC contractor who had 50% turnover per year and we took that number down to four in two years so you can do the math on that man I mean you know what those those jobs pay right probably $80 to $120,000 I'm going to take debate and tell me what they were they treating him badly were they hiring them what was the formula there that that must have been rather obvious that they were doing something wrong obviously so Mel put his finger on it right so the new owner bought it from an old owner the old owner had the belief system that employees were a transaction that that employees Were Expendable so it started with a mindset right and and and the new owner had a different idea of how employees operated in relation to the company but he didn't know how to manifest that in his mission his vision his values his internal brand so to what Mel was talking about like communicating to the team what matters so we helped him do that we helped him articulate that we helped him announce it and then we helped him manifest that operationally so changing the job descriptions to to not just look for skills and talents but actually to look for a a Persona type to look for a a set of values that are about teamwork collaboration caring for the customer and so you you you know it doesn't happen right away but when you start bringing in people who care about those things now you're Shifting the culture all right so what you said though this was clearly not just about the vision and it was also about just better management of understanding how h well let me let me let me just drop this in here what it does if it's done right is it it starts to invade every system so for example the interview questions that we now use and our interview approach is driven by our Nu Clarity the way we evaluate our talent is driven by our new Clarity the way we look at customers and what is a real opportunity our go noo strategy is influenced by our our our clarity and so you start to see this just infiltrate your organization so everyone knows which way we're going and why and we we eliminate a lot of the the noise that come from Bad hires it's not zero of course you always have bad hires but but people who just obviously don't fit customers who obviously shouldn't be in your portfolio you know even the things we do in the community whether we decide or not to is all much more clear today because of it so I think that's what it does it and it and and to call that uh marketing is is almost is it just is it disservice yeah it's almost cheating it a little bit and I don't have a better word but but it doesn't it's more than that Mel can you tell us what you paid for that rebranding and that Clarity yeah so the Consulting fees were and I'm I'm I'm making it up but I'm close 170 Grand but you know that's the beginning right and then I got all new swag everybody's got to get new stuff I got new signage all over the place I've got to redo our HR stuff I got all the vehicles have to be rewrapped all all that stuff every sign on every job site has to be changed and wait did they take charge cards the The Firm yeah no they didn't take charge he's always looking for points got to get some points out of it at least all right Mel do you have an expectation as to how much that's going to pay off no and and when I heard him say when I heard him say 10x it it made pause because if I heard that it might have turned me off Lauren so you mentioned that the promise they made was Clarity across the organization and and they and they sold me on the value of how that would look and this idea that that we are a very values driven Purpose Driven organization is is really really key and he tapped into that the guy that was selling it tapped into that by the way the guy who was selling it was also on the team that implemented we didn't have a side salesperson so I I I would just say uh I I'm not trying to measure it Lauren I can feel it I can see it I I can feel the energy behind it and so I don't have a need to do that but it's also been too soon I mean we just finished in July and launched it I gotta tell you though the payback you have to remember this is not 170 Grand this is divide that in five years I mean it's a lousy 30 grand a year for I mean this is going to last for the next whatever so it's not like you're going to be paying it every single year absolutely it's really a minimal expense when you think of the big picture and what I would say uh Sean in your case you help people uncover opportunities in their business to maximize performance I think that's what you do you uncover opportunities to maximize performance and if you said that to someone I think they get it yeah I mean I think that what you say about the spread out over five years is something I've thought about for a long time is like is the activity you're doing something you put on your p&l or do you put it on your balance sheet and I would argue that 170k actually is a balance sheet activity's no doubt yeah you're making a capital investment in the long-term health of your business and and it will depreciate right like it'll you know but maybe it'll amplify but like a p&l cost which is most marketing is like okay we tried something and it didn't work or we did this thing and it increased you know 2% or whatever it's not a balance sheet activity and that's why it's actually is giving bad financials if you took that all off one year the fact is it's it's not accurate cuz that's going to last for years so it's G to it's going to mask profits because you say oh wow you didn't do well this year no you put this money into it but to your point this is an investment Sean you told us that the uh I think you said that the 100 day thing has already shown some promise can you tell us what you were referring to yeah actually this is my aha moment of I think we need to switch our organization and I and I think M you do this but correct me if I'm wrong I think we need to switch it from Shawn goes out and gets business because he has a really big Network and people believe him to uh everybody in the organization is active in the community and really switching to that mode and what's really been cool about this activation is I'm asking people who have never been involved in the sales process before say and I use sales Loosely I call it Rel it's relationship building who've never been involved in that who've basically just done the work I'm asking them to like reach out and be part of the network and connect and they're doing it and they're getting great results you know they're having meetings with people who are saying I'm interested in that or let me introduce you to this person this person might be interested in what you're doing one of my guys had a meeting the other day with somebody who gave him like six connections that are all really highly valuable and it's just I'm just like smacking myself in the head going why did I not do this years ago you know no I think that's similar to the approach you described the last time you were on uh that you taken I mean it it is critical for us because again I don't know when someone's going to build and if it's in the newspaper it's too late and I I will tell you that it went from it mainly being me to it almost never being me over the last few years and it's because it is an expectation of every leader in our company that they're involved in the community in some way and I mean a meaningful governance level way you know on boards and other things of that nature and um now it is the slow train but it is a it is a sustainable train right Mel tell me can you tell me a little bit about how you made that transition from you being the guy to the team being the quote guy G yeah so I wish I was super thoughtful about it I've gotten better in the last couple of years but here's the premise so if I'm if I'm known by everyone which I was by the time I bought this company um then I already have this access and so what I began to do was say you know what I'm going to leave that board but I've got a replacement for my organization and most people will take that because they don't want to lose our support and so that that just got more and more thoughtful for example the the gentleman who was just announced as our new president and CEO will be the chairman of the Chamber of Commerce board next year that's unheard of for person that's been in our community 11 years it's just unheard of but it's because I left that board and said hey I'm leaving but here's the guy and they put him on so so that's part of it and then the other part that we codified this expectation that as you get to a senior level role it's explained to you by when you get promoted this is what's expected and so now it's just a built-in expectation we're not telling you where to go we're telling you go somewhere that you care about and spend time there and uh and again it's a slow train but over time um it it just really pays off it's amazing the kind of opportunities we get just because we're in the room I really appreciate you sharing that and I've already got something great out of that about that idea of you know Blaze the trail put somebody else in place after you because I can do that and then the other thing that one of these longtime clients I was talking about he has like zero salese even though he's like a 32 person company and he essentially has turned senior leadership into those types of roles which has an interesting ramification in terms of your financials because most Professional Services businesses that have compensated salespeople they're paying them a quarter million a year you know or more do you have any dedicated quote unquote salese or we don't we don't we have any person no and and we just hired a person in February whose job is to coordinate the responses to rfps but but you know that's 25% of his job um and he's got other uh internal uh respons internal and external responsibilities as well so we really don't and what I found is for our business those people get frustrated sales pure sales people because they go out they find something that is a good lead it's just not a good lead for us and if they come back with five of them and and four of them are bad they they they just get very very frustrated so you know the hunting model for our B2B business and I'm not saying it's for everyone but it's just it just doesn't work for us cuz we we say no to too many of those opportunities mie the last time you were on you told us that you were getting ready to kick yourself upstairs uh it sounds like that has in fact happened uh how's it going hey I tell you what this is not for the faint of heart I tell you I have never felt so different literally the hour after so so imagine this we have this big announcement and let's say it's like 1:00 we announce this right it takes all of about 12 minutes to announce it and you know video cameras rolling and all and then we're going to have a big party we call a party on the lot and so we've got this big lot by our building and we go out and play whatever and eat and have beers and so we we make the announcement we go outside to to start hanging out and I'm telling you I'm by myself no all of a sudden no one wants to talk to me it is just amazing to me and maybe it's in my head but um it it it went over very well it was one of those well of course we saw this coming which is what you want the feeling now though as my days wind down into the years the last day uh is you know I'm I'm trying to figure out how I'm going to be you know I still own the majority of the company and if I'd be lying to you if I didn't have a little bit of anxiety not about how well my successor will do but about my own need to know and be involved and make decisions and so i' I've got to figure that out this is a leadership transition do you have a plan for an ownership transition yeah we separated to two and I I got this idea Lauren from my my peers at Tugboat um who I've just seen so many models and I was consternated because I was trying to change leadership and ownership at the same time and and I it just hit me like don't try to do both so right now we are treating ownership as a family asset our middle child is on the board of directors and we'll leave him there for now and I'm going to teach him good governance of the asset and and then we'll see what happens uh over time but I'm trying to keep my options open on that part sounds a little like you Jay Jay went to sleep Jay you still there Jay once we stopped talking about direct Mill I'm out of here so U Mel I'm really interested in this in this topic because I you know I'm 52 and you know I've been thinking about you know how to transition and the difference between ownership and Leadership tell tell me a little bit about how you identified that person to follow in your footsteps yeah it was a little Serendipity right because when I bought the company I don't have any construction background I had a partner at the time that did it didn't work out so I assumed the seat of CEO president and CEO with the expectation we'd go find a CEO and that person would run the business I kind of like the seats so I stayed in it but the person that we did find became the the uh the successor and so he was kind of always seen as my partner in running this thing anyway and so I I got a little lucky it's going to be harder in the next go round though we're going to have to be much more intentional about development and positioning what I don't think it we're good going to be good at is bringing someone fresh from outside I think we're going to have to figure out how to bring him up in the organization all right do you hear me now yes okay I'm going to tell you something that's kind of funny so I I think maybe I accidentally hit the button on the court and I didn't notice it I kept saying something and you kept talking over me and I thought like God both Sean and Lauren three four times it's like all right I'm just not GNA say anything because like you just keep cutting me off and now I realize the mic wasn't on because usually I've never had that feeling so so my big question to Mel is which is what I really want how old is your son uh my son is our our son is 27 wow okay that's a lot to have on a 27y old well it's a seven person board now he's not chairing the son of a b I'm saying just saying that's that's young yeah and and uh I actually would disagree with you I think it's perfect because there's no weight on his shoulders at all he is there um and he gets an opportunity to learn what governance looks like um he gets to learn deeper about what a privately held business don't get me wrong I think it's a good thing I'm not saying I didn't think you were I would say to you that's the time if you've got a young person around because if you if you wait too long in my opinion at least they have less of a Runway before pressure hits so let's say I'm 70 years old and then we decide hey let's bring the kid in now he doesn't know his butt from a hole in the ground so he's in there you know yeah no I think you're right what's his job Mel uh he just finished Law School in uh May and started as a Young attorney 60 days ago here in town and the reason he's on the board he's the only one in town so it just makes it convenient our daughter's not interested our younger son probably would be too but I love the fact that he he for the first year he was on the board he was on the board all through law school he didn't say a word and I was smart of him because he didn't have any words that made any sense but I can see him getting more comfortable and um and adding more value from a perspective of being a younger professional and all but there's no pressure on him because the other board members are carrying him right now which is perfect all right so the three times that I kept trying to say something that I thought you were talking over me here was my point I've realized you're in service business business is I'm a retailer I this is the difference I don't have any first of all I've got no one to go out and calling and no one's giving us enough business to invest the time and going so that's why I think like a retailer I got all the dials of retail Direct Mail blah blah blah and I can't argue with you what's your doing makes sense for a service organization that a you've got big clients that are going to turn into potential you know 100,000 200 500 and yeah people aren't spending $300,000 to frame a picture or buy a sofa the difference between to B and B Toc is huge and uh and no doubt about it so Sean I I I I feel I feel you I really do I appreciate that man because like I God I have this poor client there's so there's such a he's such a good guy and we told him we really think you should hire a marketing coordinator and here's what this person would look like if you'd like we can actually interview and he turned it over to his HR department that was the first mistake um then the next mistake was they brought in somebody with extensive experience in B Toc and I'm like this guy's a this guy's an engineering company and he didn't hire coordinator level he hired somebody who perceives themselves as very senior so he's launching all this like digital this and digital that and you know like no no the buyers are not searching for your services that's not I don't think there is a bigger bandwidth than marketing you know get an accountant okay they're going to probably know how to do a tax return do some financials marketing could be anywhere from it's almost a meaningless phrase like what you know so to your point they hire the wrong person and they're going to be turning the dials on the wrong dashboard basically boy you got to get it right in terms of who you work with and who you hire like Mel it sounds like you killed it man like you hired the company to help you gain more alignment within your organization you could have gone and hired somebody who runs paid AdWords on Google like literally but I've seen that happen you know and and conversely you know a company who sells jewelry online probably should do paid AdWords on Google but like knowing the difference it's really hard and the industry doesn't want to educate you the industry just wants to sell you whatever it is they do absolutely it drives me crazy the the difference between a a businesses to Consumer company and a businesso business company is huge and and then I think also you start breaking down Services versus product it gets even more Nuance in but that difference is Major and our our marketing manager she came to us as a coordinator she's a manager now but we stole her from another construction company I mean you know because she understood what we were trying to accomplish well part of it in this case is I'm looking for a thousand customers to spend $1,000 you're looking for one customer to spend a million dollars so it's totally different or more right it's I mean with gosh I mean what's your customer value it it's got to be tens if not hundreds of millions right well we're not hundreds of millions ourselves but you mean over over a lifetime absolutely yeah absolutely I mean we you know our our good customers are doing between 20 and 30 a million a year with us and that's just a lot of uh you know so I I I only can handle 20 customers at any given time and and they're in some stage of planning or execution of work Jay I have a question specifically for you uh we we don't have too much time left you and I were talking the other day you told me that you're kind of having uh a tough time deciding where to draw the line with employees who don't seem to be comfortable doing things that were once taken for granted like showing up on time it's become a problem you know I went to that ESOP convention and the guy speaking said something he goes Hey listen most of the clients I work with they've thrown out their attendance and late policies and it's like oh my God I thought it was just me the anxiety level out there in the world is so bad these days that people are struggling and you don't know where to so what do we do move it from you get three free lights a quarter to five or 10 I mean at some point it's not fair to the other employees and like it's not just me it's everyone I've talked to about it I I'm trying to be accommodating and supportive and everything but at the end of the day someone needs to answer the phone at this company and talk to a customer and I I'm it's definitely different than it was 10 years I mean there's no comparison so different than five years ago yeah it's it's a problem and I'm I'm I'm having to reestablish okay when do we say I'm sorry that you're struggling but if they if they start missing one day a week or something I I I can't deal with that I the business can't deal with that and so I don't have an answer I'm trying to navigate it myself Mel have you seen this too oh yeah I was like as as Jay's talking I'm like Mel's gonna say something here but here's the thing at the end of the day we do have to do business so what I try to tell the team is everyone's going to have a season when things in their life don't allow them to be completely present but it can't be their season can't be all the time right all four seasons right you can't have all four seasons so you know you know what I'm saying like they've got a sick child or they've got a parent that's aging so I'm trying to work with you through that right but but what we we don't have a specific attendance policy what we have is a a qualification of expectations so for example if someone's struggling can't get to work on time Child Care something car is broken down all that kind of stuff happens their manager should be talking to them about first what can we do to help if there's anything we can uh second what's the expectation you can give me tell me what you can do and I'll let you know if that's going to be enough but when you tell me what you can do 3 days a week 2 days a week one day a week I need you to do that and that gives some flexibility for the season but then you got to let them know we going to have to get back to something else at some other time you know what that's that's an excellent point just to be clear there Jay when you say that's an excellent point you're talking about what Mel said about asking that listen what do you think you can do like for instance I had someone she comes to my manager and she works in framing she wants to take Fridays off so she can work in a different frame shop where they'll pay her cash $25 an hour and we have to explain to her like no we actually need you here to do the job here not not work for a competitor for K and it's like you want to say seriously that would have never in a million years happened five years ago and I want to say again because I always call I've got lots of lovely 2ome year olds here that work out great it's not everybody but there certainly are a part of of the people that are out there these days that are coming in for jobs that just think basically they should be able to do whatever they want to do at Catalyst um a couple months ago we had a presenter who does kind of home health and assisted care so if you think about who those employees are right they're generally single moms or very lowincome folks they have a lot of challenges kind of because they have kids and kids get sick and all this stuff and what's interesting is she has this attitude of like how do we take the stressors that are constant off the table and as an example she said you know when you don't have a ton of money and your car breaks down it's over it's over and and so so what she did you know and she's getting to a size now where she can pull this kind of stuff off she like bought a car and the car is kind of a floater so if if if somebody is is struggling because their car broke down and they you know maybe can't afford to fix it right away or it's going to take a while to get it fixed she gives them the floater and I was like wow that's really Innovative and and I think that's the challenge As Leaders is figuring out when to be Innovative and creative and do things like that and when to like have a certain set of boundaries I can tell you I've given out over the last 45 years I'm sure I've given out in 300 loans easy every bit of there's always three or four and if somebody transmission and they need six I give them the $600 and it you loan them the $600 I loan them the $600 now the interesting part of the story is this you should ask Jay out of 300 times how many times have you been stuck once once for $500 and it was well worth it because the guy was becoming a pain and it's like it was cheaper than unemployment he just disappeared and and I wrote I didn't try hassling him for it I just said that's fine I I I I accept the risk when I give it I might not get pay back but Mel I love your answer to ask them tell tell me what you think is going to happen from here forward give us an idea of what and then we can say yeah it's that's not going to work or we can then say two weeks later you said you were weren't going to miss anymore they I I I think that that was an excellent suggestion welcome to the 21 hats team I'm going to do a direct mailing next week excellent I knew I would get you to turn on that all right my thanks to sha busy Jay goz and Mel Gravely and to our sponsor the Great game of business which helps businesses use an open book management system to build healthier companies you can learn more at Great game.com thanks [Music] everybody wait wait don't leave yet if you have a question or a comment that you'd like the 21 hats owners to address send it to me by replying to your Morning Report or by email at Lauren 21h hats.com that's l o r n at21 hats.com do it now before you forget and don't be afraid to tell J what you really think you can take it and if you got something out of this conversation help us reach more business owners tell a friend subscribe and review us wherever you get your podcasts follow us on Twitter subscribe to the morning report at 21h hats.com this episode was produced by Jess Theron founder of blank word Productions okay now you can leave thanks for listening everyone [Music]