In this master class episode, we are going to be focused on hiring. People are the first form of leverage available to any business, and leverage is what allows us to go beyond our max capacity indicated by an inability to keep scaling lead acquisition, an inability to serve all interested clients, and being unable to deliver to the same level of excellent service as we used to when we had fewer customers.
The only way to go beyond max capacity is by using leverage. There’s a bunch of different kinds of leverage, such as other people’s time (OPT), other people’s money (OPM), other people’s knowledge (OPK), and so on.
Regarding leveraging people, we are going to look at how you can build your team in order to increase your capacity to do more than your current max capacity allows you to do.
Why is leveraging people important?
It is hard putting together a team. The first reason is that it isn’t always easy to find the right people for your team. Who is the one person you crave for that would make a huge difference in your business? Is it the accounts person? Is it someone in operations? Is it someone with legal expertise?
You are overwhelmed by having a lot to do. The second reason is that you will quickly become overwhelmed if you try to do everything by yourself. This happens to a lot of business owners who get something started and then once it picks momentum, they get overloaded with things to do. The truth is, you will not go far trying to do everything on your own. You need the right people to help you speed things up.
You lack some fundamental competences. Thirdly, you will need help in that one or more aspect of your business where you aren’t so strong. In what part of your business do you, in your heart of hearts, believe that you could do with a little help?
You are at max capacity. The fourth reason why you need to leverage people is that you are at max capacity and are unable to do more. You need something or people to make it possible for you to go beyond your current max capacity. Where in your business are you currently at max capacity? If you can identify where your current bottleneck is, you will be able to unlock your business and you will register massive growth.
Identifying which aspect of your business is at max capacity and making small tweaks in that area will bring massive results. For example, one client who moved the needle from $3 million to $16 million in revenue found that their game changer was adding more people to the sales team. They had reached max capacity in the sales department, and making that adjustment gave them phenomenal results.
You’ve hit a ceiling in your business. A ceiling and max capacity are different. Max capacity means you are full while a ceiling means no matter what you do, no matter how far you scale, you just can’t surpass a certain number (revenue, for example) in your business. Where is that ceiling? To be honest, most times, the ceiling is in the psychology or inside the head of the business owner. As the business owner, you have a ceiling because your limitations create limitations for the business. The business cannot see beyond where you see. You have not imagined a universe in which it is possible for your business to go beyond its current level/ceiling.
If you as the owner recalibrates the range of what is possible for your business and you have clear metrics to believe this is possible, your team will inevitably find itself adjusting upwards in order to come close to what you believe is possible. For some reason, a team tends to perform just shy of the level that the owner believes is possible, so address your ceiling if you want to see massive results in your business.
If you don’t handle leveraging people the right way, you will end up stuck doing everything by yourself and you will never become a true business owner. Your business will own you!
We want you to break through those limitations. Just a quick question, what would your life be like if you were to 2x, 5x or even 10x your current business? If you were to grow your profits five-fold, how would that transform your life? If you were to give your clients 10 times the current results you have been giving them, how would that feel?
Things that happen when you expand your max capacity
When you expand your max capacity, a lot of good stuff happens. You get some things off your plate (doing your own bookkeeping, for example). You get to have an A-team of dedicated, focused and driven people helping you attain your business objectives. You also get to elevate from an operator to a true business owner who has a team to help deliver world class results on a daily basis.
A Case Study: The Golden State Warriors
Remember the Golden State Warriors case study? The team used to be last in jersey sales data, last in popcorn sales, last in ticket sales, and so on. They were purchased for $450 million. Currently, they are worth $4.5 billion (and the figure could be higher since I pulled this info a while back), number one in jersey sales, number one in ticket sales, number one in popcorn sales, and they are crushing just about every stat out there.
And they did it by building a team of A-players. What most people see are the A-players on the court. What they fail to pay attention to is the head of marketing, the head of sales, the head of partnerships and all the other behind-the-scenes people they have on their franchise team in the office that really drive the business end of the brand forward.
And so they built a team of A-players over a period of 11years and took the value of the franchise from $450 million to $4.5bn.
Now, the reason why I use fantasy team is the sports analogy of a fantasy draft day. This means a bunch of people get into a room, and we look at all the players in the NFL, all the players in the NBA or soccer league and we each, in turn, get to pick a player that we want on our team until we each have a full roster of players.
Once we have a full team, each person’s team is going to play against all the other fantasy teams for an entire season and we see who wins.
So, if you are going to create a fantasy team for your business,
- What positions would you want to be filled on your team?
Think carefully about this question and identify all the positions you would wish to be filled on that team. Is it sales, marketing, etc. I have a good friend who has a family office in Texas. In this tiny office, they make hundreds of millions of dollars every year. He owns about fifteen businesses and they are run out of that main office and in all those businesses, they run the legal, accounts, marketing and CEO/executive functions of all those 15 businesses.
They have one solid team that then has managers and CEOs in 15 different companies and they run the majority of it in that little Texas office. Very cool! So what positions would you want on your team?
- Who would you want in those positions?
When I talk to different business owners, this is what I keep noticing; most of us have absolutely no clue who the star players are in our different industries. We don’t know who the best sales reps are that sell our kind of products, we don’t know who the best marketing teams are, we haven’t figured out who the best accountants or CFOs are in our industry, etc.
Because we don’t know who the best in our industry are, it is hard to do a fantasy draft. It is kind of like asking you to pick a player in the NBA that you want on your team and you have no idea which players play in the NBA.
One of the major responsibilities of the CEO is building the team. I have had the privilege of being on the board of a handful of startups and we’ve raised probably a combined about half a billion dollars for their companies, and one of the number one responsibilities of the CEOs of those startups if they are to get that kind of funding or get access to some of the big investment firms is that they have to put together an unbelievable world-class team.
This means the CEO has to know who the best players are, where those star players are currently employed or the projects they are working on. At the right time, the CEO has to have a strategy that they will use to recruit the executive team of A-players from wherever they are. This team will help the CEO to manage, run and scale the startup. This is a must, especially if the startup plans on raising huge sums of money. The most that one of the companies whose board I sit on raised was $250million.
So, as a CEO of your business, you’ve got to think hard about the questions above and take action to bring your dream team to reality. Can you put together a dream team?
To Your Success,