When They’re Not Quite Bad Enough to Fire

[Music] hello everyone welcome to the 21 hats podcast I'm your host Lauren Feldman this week Paul Downs Liz picarazzi and Jackie Russo discuss how they review employees and how they make the hard calls when someone is right on the cusp the conversation starts with a couple of tricky situations that Paul is trying to think through right now and then progresses through several other issues for example do you use personality tests to avoid or resolve personality conflicts Paul Liz and Jackie have very different takes on Meers Briggs and the like do you make sure no one is ever surprised by a negative review do you keep mediocre performers even when you find someone who might be better I need to go shut the door before I say this Paul tells us I forgot to do it plus Jackie finds a use for chat GPT Liz may have found an alternative manufacturer in an unexpected country and a business owner asks whether he should report a competing company that is in danger its customers and employees and should he report them even though he believes he would face retaliation even in Good Times owning and running a business can be a lonely Pursuit our hope is that these weekly conversations will let owners know they are not alone in facing challenges same thing with our daily newsletter the 21 hats Morning Report which in magazine named the best newsletter for business owners and which you can subscribe to 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 are regulars Paul Downs CEO of Paul Down's cabinet makers which is based outside of Philadelphia and makes custom conference tables Liz picarazzi CEO of City bin which is based in Brooklyn New York and makes trash enclosures and package bins and Jackie Russo CEO of brand Russo a marketing agency based in Lafayette Louisiana the episode is titled when they're not quite bad enough to fire before we get started I want to play a snippet of an interview I did with Steve Baker who is a vice president with our sponsor the great game of business I talked to Steve about what the great game does and what he's seeing out there as he works with businesses around the country for one thing I asked him why it's called the great game of business here's what he told me so the great game of business in a nutshell uh is an analogy that Jack Stack our founder and CEO to this day uh he came up with it 40 years ago with an idea of um hey I want to try to save some jobs as you recall in the early 80s the economy was in the tank and he was facing uh significant issues uh with a company he worked for International Harvester and instead of closing down his division uh he said well why don't we try to buy our jobs and save 119 folks uh you know that trouble and uh you know I'm I'm way under playing it here it's a great story and I'd highly recommend all the listeners uh check it out but the the bottom line is uh what he learned from the banks was that uh if you've got a really tough situation uh and you're trying to save jobs or do anything else uh you're going to have to understand business and he didn't understand business Jack didn't he was a great on a production line he was not great on business he was never taught that stuff so the bank s 54 of them in fact turned him down for a ridiculous loan an 89 to1 debt to equity position um and he learned a couple things one is if you got a terrible loan you need a terrible bank which is a lesson I've learned from Jack the other one is that you know you got to speak their language the problem is with both businesses is you know we are in different games than our employees and we speak different languages so he just wanted to simplify business to demystify it he used to say why does business get to be this Elite Sport for the select few that leaves everybody else in the dark and out of the money so when he went to his people and said hey I want to teach you business this is how we're going to survive what do you think great technicians say when you say I'm going to teach you business they go I don't want to become an accountant and Jack had to basically use the analogy of a game because business and games have all the same elements a team goal we have to teach around you know what game we're in teach them the rules of the game we behave differently when we keep score so we've got to follow the action and keep score and finally what's in it for me all encircling that one thing for them in the early days it was survival and then it became uh creating jobs and then creating wealth and finally sharing wealth with those who created it so we continue to use the analogy to demystify to make business approachable and invite people into the secret that has kept the halves and the Have Nots separated for hundreds of years you can read a text ver verion of my entire interview with Steve at 21h hats.com and now on to Today's [Music] Show welcome Paul Jackie and Liz it's great to have you here I want to start today by talking at Paul's suggestion about employee reviews maybe you could start Paul just by uh telling us basically how your review process works well we don't have like a formal review where you sit down once a year and go through a checklist or anything like that like I've done that in the past and morphed into something that I'd seen other business owners do couple of them in my vistage group and in particular one manufacturer and what he did was just made an attempt to sit down with every one of his employees on an individual basis at least twice a year and I started doing that in 2018 and in good years I would be able to do that three times a year now you're number of employees sort of makes that into a larger larger commitment and we're up to 28 now and for various reasons I hadn't sat down with everybody for almost a year and so got my decks cleared set up 28 meetings in two weeks which is like four or five a day wow and then just get people into my office and sit down and say tell me what you're thinking about and uh the purpose of the meeting is for me to kind of take the temperature of all of the employees and get a sense of are they experiencing challenges outside work that might affect how they're doing their work and what we could do to help or if they have questions about things that uh they've been wondering about it's it's a good way to have a conversation and i' I found that if you do it fairly often it it takes some of the pressure off to have it always be about raises and also it is a good steam valve I guess would be a way to put it where people get a chance to have their say and then I can try to address things that come up if you leave it Go a year I found and uh you've hired a bunch of people in the meantime that it's really like turning over a rock and a lot comes out running out at you so I've spent the last two some weeks really just trying to listen to what people are saying and and ask the new ones whether they're happy and some of my employees are actually you know what we're recording this I need to go shut the door before I say this I forgot to do it hang on one second sorry about that in any group of people there's going to be some who have personalities that aren't entirely genial and by the time you get to the size I'm at you've got a couple of employees probably who most of the problems seem to center around them and we have a set of very explicit culture statements our expectations of how people behave and how they should get along with each other and I have two employees who I can point to aspects of the statement so that they're not up to snuff but they are producing work and so it's not like oh I got to get rid of these people because they absolutely can't do the work it's more like they tend to drive their co-workers crazy and everybody else in the company is very patient they know that I do not like to be uh someone who's very punitive to employees that I like to give people chances to reform but I think in both of these cases what I'm running into is this is a basic aspect of their personality and me asking them to change it may or may not work but I kind of expect it won't work because we're running up against well I got one one employee who has a tendency to be very detail oriented and that's good when she catches mistakes but it drives everybody crazy when she harps on stuff that doesn't really need to be paid attention to and it's like well which one do you want do you want her to catch mistakes or do you want her to catch mistakes plus a lot of other stuff and I don't know what the answer to that is so that's where I'm at and uh I've got to have conversations with the two and I'm not much looking forward to them but what I plan to do would be like okay here's our culture statements here are the exact statements that think that that you guys tend to violate and here's what I want you to do about it which is stop doing the things that irritate your co-workers but that's a very challenging conversation and so that's where I'm at I haven't had the two with these people but I'm preparing for it but also dreading it anybody got any thoughts let me ask you first before we get thoughts did you say you haven't talked to them yet in in this round of reviews all I talked to one uh had the regular review with him and then he came back and then he wanted a much longer review and had a bunch of questions and but also brought up an incident on the shop floor that I think he was afraid I was going to hear about where he was pretty much at fault for screwing up a bunch of work and in the course of that conversation he brought up the incident first and then moved on to other things and by the end of it I sort of wasn't focusing on on the incident but then my shop manager came in and said did he tell you about this this huge thing so now I'm pretty steamed at him because he kind of played me too and uh the other one I just kep kept putting off the review because she's one of two people performing a critical role in the other gu's on vacation right now so if these things go wrong one of my self rules for any kind of difficult conversation is you have to be ready for someone to storm out quit and what are you going to do then because I've had that happen to me so I like to make sure that if it happens that we've got some way to perform the functions these people were doing in the one situation that you described it's somebody that's doing something repeatedly that's bothering people it's the way she operates in the other you've told us about one incident are you concerned that that incident is going to be an ongoing problem or an isolated situation definitely an ongoing problem and I just haven't focused on it because I did not I mean I just for the same reason I wasn't doing the individual meetings I've been trying to fill in and train a new salesperson and a lot of other things have been going on so just have not focused on this person's performance but uh it's pretty clear that it's a bigger problem than we wish and this is someone who when I first hired him we had him in one rle out on the shop floor and he did it really well well he actually brought our game up considerably in doing this one task and then he wanted to be moved into the office to become an engineer which is what he went to school for and we did that and he's just not nearly as good at it and uh which is weird but there you go and so the other Engineers are starting to really lose patience with this because okay it's a complicated job but there should be Improvement in your quality and there just hasn't been plus a desire to kind of minimize the impact of repeated errors because everyone is a grenade that gets thrown Downstream and everybody else has to deal with it you know like you thought the parts were going to be good and except they're not and now everybody's got to deal with it and that one's in simpler in a way because I have enough people available to back up for him and I haven't had much trouble hiring Engineers as Engineers it's a little more tricky when we try to move someone from the shop floor into engineering that lower success rate so um but the other person it's yeah it's like an inherent part of her personality and I just don't know and she's got some very positive parts of her personality too she's a warm-hearted person and cares about everybody and tries very hard to do a good job it's just that the way I've been thinking about it is like if you go fish for tuna you're out there on the ocean with your boat and you throw a huge net in the water and if you do it right you catch tuna but inevitably you catch a lot of other stuff too so she's the one who catches tuna but there's always something else that we have to deal with and I don't know whether talking to someone about that kind of thing is going to work in terms of fixing it so do you have the same concern with with the other person that that that person just is not going to be able to up his game to meet your standards I'm pretty sure he won't uh but I feel like I have to have to give him fair warning too got it all right Jackie Liz any thoughts wow well I mean Paul that is so much to unpack and I have such empathy because I think we all face those challenges you know employees come into the reviews expecting raises shocked that there is constructive criticism or feedback acting surprised that they no one's told them that before and it's I think it's a tight line we walk I'm surrounded on a regular basis with HR people and I I do training with some HR people through train yard advisers and I hear them talk over and over again and so it's kind of started to sink into me that first of all no one should ever be shocked when they get to a review they should have already received small bite-sized pieces of feedback along the way so that the review is a chance to look back and say okay six months ago we talked about this and four months ago we talked about that and two months ago we talked about that with documentation and so how's that Evolution coming uh so that's a big part of it I think that might is that something y'all do and I know you don't do the big review but do you do smaller feedback loops at any point well yeah I mean there's constant feedback we talk to each other all the time and when somebody makes a mistake in manufacturing it's pretty obvious you got something that's messed up just sitting right in front of you and part of the complexity is that we do very complex things it's different every time and so there is an error rate that's probably never going to get to zero and then you've got good people who occasionally make bad mistakes and then you've got you know a situation where somebody is making mistakes all the time and it just does not seem like it's it's going to fix itself and plus then despite clear guidance in the way we we promulgate our culture is not really paying much attention to the effect that this continual session of Errors has that you just keep throwing crap Downstream and it's very discouraging for everybody down there right but that said your your your point that no one should ever be surprised in a review well I disagree with that because people are surprised to I mean it's not that we should intend to surprise them but there are people who who just never hear what you're saying to them until they're ushered out the door and I've seen that um but we try to have a pretty open environment about just the quality of the work and Records about errors and and uh I've tried for a long time to have kind of a no blame culture but I think that shame is actually an incredibly powerful motivator and that if you can point out to people that when they screw up they're actually letting all their co-workers down and not try to sugarcoat that too much I think that that is actually the best way to deal with it cuz it's actually the most human way to deal with it whatever you know up to the minute HR practices may may say shame has been part of the toolkit for human interaction forever and so trying to avoid being the person who screws up in front of everybody else I think is a pretty powerful motivator but there's people who are just absolutely immune to that like they never see it anything as their fault and so that's kind of where we're at here yeah do you ever do any sort of personality assessments like Myers BRS or dis I've done them I I have my issues with them I can't even remember the company but but through vistage once we had access to a full Suite of these things and I had all my employees take the test and then check to see whether the results of the test actually jobed with my experience of the people ability to do their job and I found very little correlation so then I got in touch with the company and I said hey this is a company that would give your people a test and not only say oh they're you know like whatever they're they're in dis they've got these characteristics but then would say and here's how you should manage them or whether you should fire somebody or not or whether you should hire somebody or not in other words going Beyond just like this is what we think this person is to here's what you should do which is where I got off the bus because I was like okay so I took your test I have people who according to your lights can't be performing the job they're actually doing a pretty good job at and if again according to your lights I had interviewed this person given them your test and then not hired them both me and them would have been deprived of the opportunity to be a good worker here so what's the feedback mechanism how would I report to you that okay got the test here's the results but my experience has been this person can do it do you have any way to report back and say maybe your assessment should be broadened to possibly incorporate new information and got complete stun Silence from them and never any reply the what they apparently built their algorithms on was a series of I don't know psychological studies from the 60s or whatever you know like whatever ever Theory they pulled out of their ass and they coded it and off you go I really object to using those to assess people and make serious life decisions for them on the basis of some robotic algorithm now I know exactly why it's attractive to a boss to use those systems because it just wipe your hands you know it's like well shrug the robot says you're no good get out of here and for hiring in particular and just even ongoing evaluation of employees it's nice to have some frame of reference and if you don't have it that's a life raft it saves time it's simple and the person you send away it's not your problem anymore so I get the the attraction but I hate those things personally that was a pretty clear answer Liz have you had success with those kinds of tests yeah so I have to admit I haven't done it with my team now but when I you know in previous jobs including an American Express when they did those tests it wasn't like they just did the test and then you talked to your boss or the leader about it it was that there was a facilitated conversation within a team and with a situation or two where you know the leader saw that the people's personality types were expressing themselves and then there could be a conversation about why this person may have done this and how there was value in that or how it rubbed another person the wrong way I actually thought it was pretty useful but that depended on their test result actually corresponding to who they really were at work so what I'm hearing Paul say is that the output from those tests didn't really label his employees the way that he thought it might so to have a facilitated conversation like at that and it Paul it wouldn't be with you it probably with someone coming in from the outside for one of these things you know maybe just haven't found the correct test um I think that they can be really useful but it is more of a situational where you take a couple of situations that didn't go well where you see that those personality types were at play and then bringing people around to see what may have gone on well like anything if it's information you didn't have and and there's probably ways to make it work my my big problem was that you don't know what's going on inside that box you know like I'm not a big enough organization to bring in 10 million trainers or outside people I'm not American Express never going to do things the American Express way and I think that most of the people who are listening to this are in a different space with regards to the luxury of time and and and resources to do it that way most of us are just running our own company and like with 28 people I don't have I don't really have space for a full-time HR person so I end up doing it myself and maybe I'm good at it maybe I'm bad at it a lot of my employees seem to be extremely happy um at least that's what they told me and they seem to act like it and I got feedback about these two people and uh you know one of the one of the tests really is like if this person came in and quit tomorrow how would you feel and how would the other ones feel and I I know for a fact uh with these two that if they left tomorrow then nobody else would be particularly upset about it other than now there's work that somebody needs to pick up Liz clearly Paul is not going to choose this as a solution to his problem but I'm curious were you thinking that the test might be helpful in terms of who he hires and maybe he wouldn't have hired these two people or were you thinking that it might be useful in terms of finding a way to solve the problem with existing employees I think actually both um but with the the one about having the facilitated conversation I would challenge Paul that it doesn't necessarily need to an be an expensive or time consuming Endeavor for a small business because you know you take the test it's administered and then you know you and the facilitator could talk about what are some scenarios that we could go through where these are playing out and you know I I too I don't bring consultants for stuff like that I don't need it right now but I think that it's good if people understand the difference like let's say with Myers Briggs with being an extrovert or being an introvert or being perceiving judging or sensing or feeling you know some of the materials on this will show you what are what are examples of people operating in this way know in corporate I know I'm an ENFP in Myers breaks I've been tested four times and I always come out that way what does that mean um extroverts um intuitive feeling and perceiving and some of those things don't go very well in a corporate setting and so some of the people that I felt were very judging and came out as judging in the test I was better to understand that those people tend to be very rules oriented and that there need to be some of those people on the team you know I perceive I don't judge you know for the most part and it actually made me feel a little bit better about some of my teammates and my leader at the time um because I understood a little bit more how they ticked you know it wasn't some weeklong session it was literally just one day where a facilitator was brought in we had the test results and they actually had you know some some handouts that were done but it showed in real life what are some situations where in example of someone being judging versus perceiving or you know extroverted introverted that's just with Myers Briggs but I know disc and others they have something similar so I think it can be useful in both scenarios I'll jump in uh with some how we use it we've looked at you know disc and Myers Briggs and all of it and we kind of um gravitated towards inag and we have made decisions based on it once we started because we brought in a professional development trainer uh Melissa Bowen with the authenticity Center who's been working with us for a couple of years and she gave it to us as part of an exercise it it was about being your authentic self and um being better leaders and development and all that kind of stuff and so in doing that testing we were able to find some patterns in our 20-some people and some of the more challenging relationships when you looked at the numbers laid out it was like oh yeah that's why they don't get along they're both fours totally get that and so now we use it when people apply and they get into the final round of interviews right before we hire them we have them take the test I'm not saying we wouldn't hire a four not I'm not I'm using the fours as an example I'm married to a four so I'm not saying that but we do find that it helps or at least it helps me ask better questions in the interview uh better identify challenges they might be bringing into the relationship and helps me better understand how to coach them based on who they are not who I am because I think that it's it's not treat people the way you want to be treated it's treat them the way they want to be treated and so I think I'm a better leader because I have a better understanding of who they are and what they need and want it's it's just like kind of reading the five Personalities in the workplace you know it's that love language science of the more you know about them the better you can work with them I don't disagree with that I think that there's use there but what I've preferred to do in my company is make clear what the standards of performance are so here's the standards here's what you need to do you know if you could do it you could do it if you can't do it you can't do it but rather than assume that certain people can do certain things uh we just tell them what needs to be done and then there's there's the standard the other thing about these tests is that it's not at all clear to me how well they work for people who come from very different backgrounds took the dis test and I've taken various ones myself and all the ones that I took required pretty good knowledge of Standard English okay so if you're giving it to somebody who's a blue collar worker from T in in Ethiopia and uh comes from a completely different place weak English skills completely different culture how much is that test going to tell you like are those people writing those tests are they somehow taking into account all that I I kind of doubt it so the assumptions that are built into any test are going to guide the results and if you've got nothing else to go with great use the test but I've got a different way of going about it which is when we hire we just give people skills tests and then we make it clear like here's the rules of the game here's our company culture here's how we think about our work this is what you need to do if you can do it you're in you know I don't care what kind of personality you have one of the rules is you have to get along with your co-workers and again details left to situational uh but you have to get along with your coor workers or your your effort should never subtract from the total efforts going into the job if we're going backwards every time because of something you're doing that's a problem but it doesn't try to guess who the person is it just says here's what you need to do and that's my Approach Paul let me ask you this I think you you've made clear that you need to have these conversations you want to give them a chance you have some doubts about whether they can adjust but you're going to give them a chance to adjust I'm sure you're thinking a little bit about contingencies if they do not adjust can you talk about those contingencies is it over or is there a possibility that one could go back to the job that he did well or there just different roles they might play well I actually just discharge someone uh two weeks ago who was nothing wrong with this person other than they could not do the job but one of the policies in our handbook is you need to be able to produce work at the Quality level that we demand and if you consistently can't do it your job's in in Jeopardy and I had gone back and forth with this young woman for years about various things that she just didn't want to do and she wasn't particularly good at interacting with the rest of the team she was doing a task that didn't was mostly content production didn't require to be on the shop flow or anything but then a person showed up who was going to be able to do that job a lot better and a bunch of other things as well and I'm like you know why should I put up with a mediocre performer when I got a better one at hand so I let her go and with the two upcoming uh one I would not worry so much about letting go because we we already have two other people doing that job and I discuss with both of them hey if I have a tough conversation with with this guy and he stalks out of here are you going to be able to pick up the slack and they're like yes yes with a big smile on their face so I mean it tells you what you need to know know right which is if the rest of them are going to be delighted when somebody's gone that person usually needs to be gone Jackie or Liz any thoughts on that I mean that sums it up right there I was at an HR luncheon yesterday and the facilitator Dr Michelle Roberton was walking through the nine boxes and it was you know was one of those really great charts where you see you know your top right corner everything's golden they high performing high energy great asset your bottom left corner they need to be gone they are a drain they're toxic they're low performing and so I think sometimes it's about figuring out where every employee is on that spectrum and sometimes I think we do tolerate some uh less great Behavior but because they're so skilled and awesome at their job and then other times we realize they've just they've crossed the line it's not worth tolerating some of the bad behavior anymore for a skill that can be replaced by somebody else and I think each of us it's one of those steps on the entrepreneurial journey is to assess the talent of our team and where they fit in their roles now that said it's one of the most unpleasant things you could possibly do which is just let someone go fact and fact I dread it yep it that is not a fun conversation and I always try to prepare myself by writing down like a whole outline of what the problem is and what the solution is and in this case since I was discharging someone who was just mediocre I I put together a whole package and like here's what we're going to do and you can file for unemployment and blah blah blah so it wasn't quite as bad as it could be but it's still you know I actually got fired from something for the first time in my whole life a couple of months ago uh I was on the board of a nonprofit and my usual uh somewhat abrasive style did not go over well with one of the founders and they threw me off and so I got voted out I got ushered out you know sucked and I now have even more sympathy for people who are discharged from something because I didn't particularly want to be fired but I've gotten to age 62 without ever being fired from anything and that's kind of remarkable congrats thank you you're a late bloomer yeah but it was it was being fired for basically who I am and uh and it it's not not an easy thing to hear although it didn't cost you your of making a living no it didn't it cost them a lot of money cuz I had been a major supporter but you know whatever they made the decision so off off we go Paul it occurs to me I I think we talked through another situation of yours either late last year or early this year where you had an employee who had previously performed really well but was having some problems and wasn't performing and you were nervous about it because you felt as though if it didn't work out and the person had to leave you would would have to step in and take on that role but you were hopeful that the behavior might change how did that one work out uh I gave him the stern talk and he quit about three weeks later and I did end up stepping in and taking over his role but through sheer luck we had someone pop out of the blue who was a pretty good fit for the role so we hired her and I've been training her and she's made tremendous progress and that's what actually freed me up to do this round of reviews cuz I was acting as Sal salesperson for from about the 10th of January on until beginning of July he just resigned went off to start another thing and I was like fantastic problem solved and we had another employee on the shop floor who was really nice guy you know lovely guy got along with everybody but his he had sort of ceilinged out in his skills acquisition and and my shop manager and I were discussing this and and my shop man said I really you know I think we need to get rid of him and I was like yeah but he's older I don't want to put him on the street and have him have him just you know like destroy his life and I just don't feel like it well he just walked into my office and gave notice two days ago and had found another job that made more money installing closets and and you like great problem solved so sometimes these things solve themselves if you're lucky the the people just get a sense or whatever they just they move on but sometimes they don't and you got to you got to do something it sounds like you're having a certain amount of turnover is this normal or is there a reason something else going on that's creating this um it's not an unusual amount of turnover I mean I didn't mention that I've also hired let's see 1 two 3 four five in the last six months and they're all in their 20s and they're all doing great so that's the flip side is that we've been attracting workers who I'm very happy to have and who are happy to be here and uh I feel ever more committed to making sure that the team doesn't have any bad apples in it because I've got a great team you know like there's a lot of people here who work really hard pay attention to what's going on and uh I don't want them to be frustrated because I will not take action and get rid of a of a under forming coworker and I think that That's a classic trap that bosses fall into they let these things go on way too long and it starts to discourage the other ones and you really don't want that it's toxic you don't want that one person to Poison the Well right but even someone who's not overtly toxic like an can Poison the Well if their work is not good because then it's like well why am I killing myself to do great work when the boss is tolerating mediocre work and that's a good question I don't know why any worker should uh put up with that from leadership particularly in small companies let's move on I want to run another interesting situation by you guys this is another one of those things that I found on the small business subreddit it was headlined should I blow the whistle on my competitor let me read it to you quickly I own and operate a small business within the US in a state and federally regulated field of work this work requires both National accreditation and State Licensing though they claim to be licensed my major competitor and likely largest producer in our local market has operated without accreditation or licensing for many years according to the law each day they are in operation constitutes a potential criminal charge and fines moreover their actions have the potential to cause an imminent threat to the health and safety of their customers and employees I want this competitor to be held to the same standards and regulations as the rest of our industry I've attempted to inform the relevant authorities anonymously however neither our state agency nor the national accrediting agency will accept an anonymous report I have every reason to believe that this competitor will retaliate against me personally professionally and even physically if I were to make a formal complaint small business owners what would you do in my position anybody so my gut feeling on this is that he should drop it and the only thing I would kind of back that out is say if it is truly something where it is unsafe um that would kind of make me maybe rethink my position but the reason I feel like it should be dropped is that having a competitor or a rival that consumes your mind and your time is really draining um I had a situation A couple of years ago where a new competitor had copied a lot of my product um an enormous part of my website word for word was copying the captions on my um Instagram word for word you know I got in the legal thing with him that I just kind of got in you know the early stages of with season assist this may just be me but I ruminated about this situation so much and it was really draining and it took away my focus on growing the business my employees my product all the things that bring me joy and I needed to kind of get it out of my system and I ended up having a few victories out of it but this fellow actually called one of my government clients and said why is City bin getting so much press like why are you favoring City bin and I found that out and that made me even more pissed off that was really what drove my kind of obsession with that situation and So my answer to this would be don't try to do anything that is going to put you or your business in danger certainly if it was a physical situation and that here she should look at how much of my mind space is taken up by this situation because if it's a huge amount that's not good and then the other thing is focus on being a better competitor you know focus on having a better product to service so the customer chooses you over that other person um I know that's probably easier said than done but from my perspective the toll that a competitive rivalry like that can take is not worth um it's not worth the time effort or money Liz what happened to that competitor that copied you did they continue to grow and do well no they didn't they have a very small business um really small compared to me like I mean if I had to put a number on it maybe 2% um but I had to let go of my frustration with the situation at the time I didn't know how well they would do and so that was a little scary and it felt quite threatening um and also my my righteousness came out like blazing I can be a very righteous person so this how dare someone copy my product bad enough but as someone who's a writer and spends a lot of time on my marketing and my copy how dare this person copy my writing because that's something that side by side you can compare and see these are the same words with the product it's harder to do my patent is probably not strong enough and that's what came out but I decided not to pursue it further legally because I I realized that he couldn't compete with me but when it first happened I didn't know that and I just I knew that it took a big toll and I'm glad I'm passed it I had a similar situation too I guess we all do at some point I would not consider them a competitor because I don't want to elevate them to a certain level and this gave them a unique uh competitive advantage in the market because they illegally classified all of their employees who went to their office every day from 8 to 5:00 had no other jobs as independent contractors and therefore they didn't have to pay payroll taxes or benefits and so it definitely created an imbalance in um their charging model their pricing model and you know there were other companies in our space who were aware of it and there was discussion about you know should we do this should we do that and I saw both sides I I could see the the um need for just and desire to turn them in and at the same time kind of felt like Karma was going to win out in the end you know I I think bad business people tend to reap what they seow and you just kind of let it play out it it tends to work out the way it's supposed to is that what happened yes well and the Integrity that they show you know in the situation with you if it's bad integrity that's going to show up with their customers as well and that is going to make them self distract Paul what do you think I agree with everything Liz said it's very easy for you to let competitors or any number of uh distractions into your head as a business owner and all you can ever do there's really only one thing to do make the best business you can provide the best product and uh that's how you go forward in this particular situation though I do think that that people who don't meet the minimum legal standards for employing people um it is hard to compete with that in some Fields like we don't know what the field is here and we don't know whether whe the person has correct information we we don't know a lot uh we don't know to what extent we're you know when they say health and safety what are we actually talking about here so I would take the question maybe with some grain of salt but lizz's observation that that once these people are in your head I mean they destroy everything around them because of their crappy way of doing things and now now you're in the you're in the mix and so you can get sucked in and there is little to do I think that in a world where there's many many ways for people to leave reviews of businesses uh and many many ways for a business owner to highlight their own accomplishments that people will catch up with the Bad actors faster than they used to be so I'm actually kind of curious about what kind of product or Market can go on forever and be the dominant player and nobody's ever left a review or nobody's ever ever had a bad experience or you know like maybe the questioner just wishes this person would disappear but but I think that um I mean I I've never heard of a situation where there was no way to actually register a complaint so I would say that if you're the average business owner and somebody does like what happened to Liz and that's happen to me on many occasions too people stealing my images or whatever you just have to get Beyond it be like you know what once they pick up the phone they're going to know the difference so it if you've got limited head space for all the different varieties of trouble coming at you don't spend it on that interesting I think we have time for a couple of quick updates Jackie you've told us uh in the past about your pretty ambitious effort to review all of your processes to see if there's anything you can do to improve them especially using AI I'm curious anything new we have actually I think had pretty good success with it it's not replacing people by any means but we've been able to use it in part of our razor branding process that's the Strategic brand planning we do it's U been very helpful with research with developing personas H it is a brainstorming partner we would never let any AI write our copy for us and we have human copywriters team of them that are very good at their jobs they are still far more creative and clever than AI could be but you know I'll keep you posted but for now their jobs are all safe and they're very talented but it has I think enabled us to do social media faster uh you know developing ideas for captions we still humanize it before it is ever seen by anyone but that brainstorming partner is great uh from a graphic standpoint I was on a Consulting call with a company just the other day and they were telling me that they had heard the advice and they realized they needed to change the name and I would love to get into it because it's a disaster and so they had come up with a new name and uh a new logo and unlike the advice that I gave them in terms of hiring an expert didn't have to be us but hire an expert for that they were continuing to do some things on their own and so we're on a zoom he shows me the ideas that they had for the names and the designs worse than the original if that's even possible like so much worse than the original and I said you know this is a Hospitality service-based business and you're using blood red all caps you're yelling at people uh you're you're practically threatening people with your logo you're not encouraging them to come in you're running them off and so on the call while we were chatting in the matter of three or four minutes uh one of the other um team members quickly jumped on Chad GPT and just said listen this is how far you are from where you should be and just showed them an AI mockup obviously not right not tradem markable just to show them the difference between something that looks clean and Polished and professional and finished and something that looked like what he was doing in paint I kid you not Microsoft Paint is what he was using to create this um extraordinary accomplishment of ugliness and I finally saw the light go off in his SI now please know I had shown uh close to hundreds of examples of companies that do it right companies that do it wrong how families of logos should work together and not work against each other explained House of Brands versus branded house but for whatever reason once he was shown his idea in this quick kind of sketch way he got it and now he's on board with doing it the right way and I thought oh that's what it took okay got it uh and so that to me is the tool it's how do we use it to save a little time here to visualize what we're talking about there you know it's still six-fingered people it's not final by any means but it's been great and we've gotten in enough that I'm actually U have been brought in by scbd uh Statewide to teach some AI classes and it really it's a whole technology series online of how to use technology to turbocharge your small business how to to incorporate it into lots of different small areas where it can help you do your job better because so many marketing people are self-taught that they've missed a lot of the foundational things and and they don't know what they don't know what do you think happened with that client why did that chat GPT logo why was it able to convince him of something that you weren't able to convince him of I think sometimes people don't have very good taste sometimes they know they don't have good taste I know that I can't look at paint colors or Fabrics or furniture or carpet and know how to pull a room together that is not my skill set so I think sometimes like me people just don't have a vision or a talent in that area I think when it comes to logo design if I show them a series of really smart wellone big companies it's automatically discounted in some ways because it's big companies I don't have Nike money I don't have FedEx money I that's unattainable for me and they don't have the problems I have and I'm thinking they all started small just like you you know they got there because they did the right things the right way and so part of it is Vision part of it is taste part of it is understanding the options and so by taking their name or the name they were wanting to use and putting that into something now it's like oh I see for whatever reason the bell went off the light went off you know like they got it one other update real quick Liz we've been talking to you about your ongoing efforts to deal with the threat of increased tariffs on the products you make in China you told us about visiting uh a factory in Vietnam and uh your plan to have them do a uh an order for you to assess where do you stand anything new so the big update and this is interesting on two weeks ago on Thursday I had a meeting with a Canadian Factory and I thought oh I'm just going to take this call let's see how it goes and it actually is very promising um and that makes me feel a lot better because if Trump wins unless the relationship with Canada changes Canada would be a safe place for me now that's not to say that I would yank everything out of China Vietnam it would mean that I would diversify my supply chain and have Canada be in play I've been focusing not just on the price and the price of the tariffs but also on the cost of my supply chain so the cost of uncertainty is very high the cost of worry is high the cost of containers is incredibly volatile it's gone up in recent months as we know the tariffs are going up but you know let's say something goes wrong and I need to get some new parts from China you know I often have to Airship those over and that costs a lot so the idea of having my Supply you know made and housed in Canada you know a 9h hour truck ride away is I'll just say the word tantalizing I'm like please so I'm getting the quote I'm having a meeting with them and if that a can work I'm going to feel a lot better than they about things when will you know more about uh the situation in Canada at 2 o'clock today in less than an hour wow I got the quote while we were taping and I'm having a meeting with them in 59 minutes not that I'm too looking forward to it did they quote in American dollars or Canadian dollars I actually don't even know that yet that's going to be something after we get off the phone I'm going to take a look at you should figure that out because there's about a 30% difference yeah it's actually a little higher than that so if they're Canadian dollars and the price they gave would actually be very attractive with the number that I saw well we will be eager to hear more about that when you can tell us uh but for now my thanks to Paul Downs Liz picarazzi and Jackie Russo 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 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 r n at21 hats.com do it now before you forget and don't be afraid to tell Jay 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 podcast follow us on Twitter subscribe to the morning report at 21h hats.com this episode was produced by Jess thubron founder of blank word Productions okay now you can leave thanks for listening everyone [Music]