Ep #19: You Can’t Short Cut Human Capital

 In Podcast

There’s a misguided belief among entrepreneurs that team building should be fast and easy and that you shouldn’t have to slow down to do it. However, if you’re trying to cut corners where human capital is involved, it will be obvious in your outcomes.

What you’ll find in this episode:

  1. Do you feel like Kris’ client who said, “I feel like adding people to my business is slowing me down.”
  2. If you take the time and do it right, you can magnify the effort of your business through 10 people instead of just one.
  3. Investing in your human capital isn’t unique to you. It’s the same across all industries.
  4. There’s a right way to invest in, and develop, the human capital part of your business.

Featured on the Show and Other Notes:

  • If you’d like to work with me in my group for female entrepreneurs, I’m doing 20-minute consults right now with women who have their own business who are generating a $1M or more in revenue and who want to work through specific challenges. This group launches soon and will consist of very small groups of successful entrepreneurial women meeting weekly. Go here to set up a time to meet with me.
  • If you like the podcast, please post a comment or review on Apple Podcasts.
  • Reach out to me by emailing me at support@leadershipcoachllc.com.
  • If you haven’t joined my email subscribers list, you can do that here.

 

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Podcast Transcript

Hey, everyone. I’m Kris Plachy, and this is How to Lead for female entrepreneurs and founders, because the best way to grow a business is to grow the person who’s running it. Let’s go ahead and get started.

Hello, how are you today? Today, I want to talk with you about, and this might be a touchy subject. Maybe it won’t be, but it may be, so let’s just go with the fact that this may not be something that is going to be your favorite thing for me to say and for you to hear as a woman who leads her own business. So when people call me and they reach out to me, most of the time it’s because they’re in some sort of triage moment in their business, and I mean triage because they feel underwater in some part of their business, and it, most of the time ,has to do with their employees and the people that work for them or even contractors who are getting work done for them. And one of the biggest reasons that my clients struggle with having people on their team, having people in their business, is because then you have to start to rely on other people to get work done. This is so counter-intuitive who we are as entrepreneurs, right?

So the person that you are is the person who’s a technical expert in something, and you decided, “I don’t want to work for other people. I want to create my own thing. I want to go out in the world and make it happen,” and you did. And you’re a hunter, you’re a mover, you are a quick action taker. You’re really good at getting things done on your own. You have great ideas and you know how to implement them, so you develop a pace of work that feels really good to you, and you’re super excited because it’s working and you’re getting rewarded for working that way. But every business as it grows does reach this point where you can’t just keep doing it by yourself, right? It’s just physically not possible. You’ll either stunt the growth of the business or you’ll have to charge inordinately if you’re in a service-based business. Or your business will just stay the same, which is also fine if you don’t want to grow the business, but most of the people reach out to me do.

So then there’s this real difficulty in recognizing that you have to take a minute and do some real introspection into your business. Most people, when I meet them and they’re at $1 million or $2 million, they don’t have a statement. They don’t know what their values are, and if they do, they couldn’t tell me like. What are your top three values? They don’t have a hiring process. They don’t have a firing process. They don’t think about do people get paid vacations? They don’t think about what kind of work environment are they creating. They don’t think about how to have conversations and give feedback and hold people accountable, because you haven’t had to. What you’ve done, if you’re like most people, is you’ve just accumulated help along the way. Like, “Oh, I need an assistant. Oh, I need a designer. Oh, I need a website person. Oh, I need somebody to help me with my marketing,” and you just start bringing people into the business, and it’s very, very focused on the work that needs to be done.

Then you wake up and you realize, “Okay, there’s people now here and they’re not doing the work that I want them to be doing. They’re not getting it done the way that I want them to get it done,” but you don’t know if that’s because you’re just not terrible at managing. Are they bad at what they do, or are you bad at managing that process? We don’t know. I’ll be honest with you. I don’t know when I first meet a client. That’s what we have to figure out. But where I find a lot of my clients get stuck is they want to rush this part, and you can’t rush human beings. You can’t force them into sort of this robotic engine that has worked for you, right? You know how fast you can work. You know how fast you can think. You know how fast you can get something solved and get it done, but when you add bodies to that process, it changes the dynamic.

Now, what I know is so many of my clients then believe that adding people slows me down, which then means I’m going to make less money, which means I’m going to help less people, which means that’s a problem, and that’s not true. That thought of “slowing down means I will make less money” is a lie, okay? That is not true. That is a belief that you have developed because you have been such a hustler. You have been so in the grind and so dedicated to the results that you’ve gotten that you’ve been pushing yourself, but you can’t do the same thing to other people. You won’t keep them, and then you’re going to find yourself on this treadmill of replacing people, or you’re going to find yourself on a treadmill of trying to fix and deal with exhausted, burnt out, overwhelmed employees. That’s just not a sustainable culture, right?

I was just talking to a client and she said, “You know, I feel like adding people to my business is slowing me down.” That’s exactly what she said, and so that sparked a really powerful conversation we both had, because I understand that also, right? As soon as I hire somebody new into my company, I have to think about, “Gosh, what are they going to do? What do I need them to do? How do I know that they know how to do that? How do I need to teach them to do that? Do I need to teach them to how to do that or can they learn that somewhere else? What can I expect them to learn on their own, and what do I have to make sure I teach them?” Good Lord, it takes forever, all that heavy lifting in my brain. Then not only that, but when you have a new person, do you know how many questions they have?

Then if they work hard and they do a lot of work, they get a lot done in the day and they come back and say, “Okay, I did that. Now, what do you want me to do? Now what should I do?” It requires so much more of you than when it’s just you and you get to be flexible and you get to be nimble and you get to do whatever you want. Now you have an employee or two or four that you have to direct and give feedback too. But here’s the thing; so if you take the time and you do this right, then you’re going to get four or five or 10 people doing the work that you normally just were trying to get done yourself. Do you know how much more powerful that is when you can magnify the effort of your business and the results of your business through 10 people instead of just one? It’s insane, right?

I’ve had a client that I’ve worked with now for a while, and when we first started working, she was buried under her business, having all the thoughts that so many of you have, which is, “I don’t even know if I should be doing this anymore. Maybe I should be a consultant. I wonder what I’d have to do to make it eligible to be sold.” All the things, right? We’ve taken the time, methodically, to really look at her business and really assess what is her job, what does the business need from her, and then what do we need to leverage in other people? And when we first met, she had a lot of people who worked for her, but they weren’t at the level that she needed. Her business had outgrown so many of her people, not in a negative way, just from a skillset-wise.

So now where we are with her is she’s hired. She has less people, but way more, at a much higher level of the people that she has. But she never would have known that if she hadn’t gone through this painstaking process of really thinking about what she needed in her business and really being thoughtful about how she hired, really being thoughtful about how she interviewed people, really being thoughtful about how she onboarded people, right? But she said to me not long ago, “I can’t believe how much better it is now that I have people in my business at this level. It’s a game changer.” But that was a painful, I’m sure she would tell you, painful process. So why would we sign up for that, especially when you as an entrepreneur are used to immediate gratification and satisfaction?

You are used to being able to pull the trigger, do something, get it done and see a result, and now you have to come up with the idea, explain the idea, give direction for the idea, watch someone else do the work of the idea, which, oh, by the way is painful. Watch them screw it up, not do it right, have to give them feedback, do it again, have to give them feedback, do it again, and they may not even be the right person the first time and you’ve got to do it again. But then once you get that right, this thing is amazing for you. That’s what I want you to hold out for and I want you to be able to do and be willing to do the work for, because I know it’s true. But there is a misguided belief in a lot of y’all that this part, this building the team part should be fast, should be easy, shouldn’t take so long. I shouldn’t have to do it. I should be able to hire somebody to do it, and that I shouldn’t have to slow down.

There could be a decision that you make to not work with as many clients, to not work as with as many customers for a minute while you do this work. You could land the plane instead of trying to fix the wings while it’s flying, or you just decide, “I’m not going to buy into that belief that if I slow down, I’m not going to be successful, that somehow that’s going to hurt me.” What if that wasn’t true? What if that was really honestly just a thought. What if you believed instead in the bigger vision of your business? So if you’re at a $2 million business right now and you want a $10 million business right now, what we have to do is we have to make the decision to believe in that $10 million business now and recognize that there are steps that have to be taken.

And the thing about building a team and investing in your human capital as an investment is it isn’t unique to all of you. A lot of my clients think they’re the special unicorn, right? “Well, I do this kind of business. Well, I have this kind of business. In this business, we do it this way.” Like, no, people. People are people. You hire people into your business, there is a formula that you need to follow. I promise because I have coached big people and big companies and CEOs with multi-million dollar businesses. That was supposed to be multimillion dollar businesses. I’ve coached people who run medical practices. I’ve coached people who run physical therapy practices. I’ve coached people who run staffing companies. I’ve coached people who run decorative incentive chocolates companies. I’ve coached people in wealth management. I’ve coached people in online business. I’ve coached coaches with a business. I’ve coached everything, honestly. Florists.

It’s all the same. Human capital is a level-setting part of your business, and I don’t care what kind of business you run: virtual employees, all in a building employees, international, local, I don’t care. You’re not going to help me … I’m never going to believe you that you’re the special unicorn that has to do it differently. It’s a formula, and the one of the keys to the formula is you have to be willing to go through the process. You can’t cut corners. We can’t rush people. You can’t rush the human capital part of your business. It just doesn’t work. You’ll either make mistakes and hire the wrong people, you will get the right people and you won’t develop them. You won’t invest in them. You’ll burn them out. You’ll fry them out, right? We won’t lead them the right way, the best way that we could. We won’t show them how to win. We won’t give them the right expectations. We won’t have the business design in place so they know what they’re even doing.

There are these key elements, okay? So my purpose and my intention in this particular podcast for you guys this week is to really invite you to recognize that if you’re trying to cut corners here, if you’re trying to do this on the shimmy, on the easy way, it’ll only end up in the longer term showing up in your outcomes. There is a right way. There is a best way to invest in and develop the human capital part of your business, and it does mean we have to slow down to speed up, but that doesn’t mean our business disappears, dips, suffers as a result. You, my gorgeous female entrepreneur, you will be frustrated. You will have a hard time hiring people and figuring out how to manage people and figuring out how to develop a culture that you want and doing all of that consciously. Yes, that’s a big ask of you, but it’s good times because you go through that.

I honestly believe there are these milestones, right? There’s kind of that once you’ve been in business for a couple of, and you’ve made enough money that you can sustain yourself and you can feed yourself, that’s awesome. Right? Then there’s the, once I’ve hit the certain milestones. Oh, I have $1 million business. I have a $2 million business. I have a $10 million business. We sort of set these milestones like, “Okay, yeah, so if I could do that, I can do anything.” Here’s what I know. Once you have been able to identify the kind of company you run, the kind of people that need to be in the business, the kind of skill sets that you need, and you’ve designed the business to support that and hire them and fire them, now we get to invincibility. Now we get to whatever you’ve got, you can bring it to me and I can handle it.

But until you get that human capital piece really, really at a level of confidence that you don’t worry about it anymore, that you know there will be employees who don’t do what they need to do and you’ll be fine. You know that you’re never going to be held hostage by that one employee because they know everything about your business. You’re never going to be super reliant in a way that is unhealthy for you and for them, that you know you can hire, that you know you can fire, that you can know you can hold people accountable, that you know you know how to design a job description that you know you know how to figure out what a job description should be, that you know you know how to pay someone once you have those things so clear. This then, it’s just like getting new clients, delivering new products. It becomes so much more of a rinse and repeat.

So this is a little bit of a love letter and a little bit of a, “Hey, pay attention to me, because I hear you and I see you and I understand you wanting. I know why you want this to be easy. Trust me.” I’m right in there with you. I often say to my girlfriend, I’m like, “Where’s my Kris Plachy? Who’s going to coach me on this stuff.” I know that I know all of it, but I also know what happens on the other end of it, because I’ve worked with so many women who’ve benefited from doing this the right way and taking the time. That’s part of why I am launching my … Well, it’s not part of. It is the reason why I’m launching the group for female entrepreneurs. That space is where we will do all the things, where we will come together as women working on our businesses, working on the human capital part of our business, designing the business on purpose, supporting the business with the right people, triaging the moments where we have a crisis with an employee and we don’t know how to handle them.

When you watch me coach another woman on an issue that you maybe haven’t dealt with yet, but we know that you will, because like I said already, all of the issues that you’re experiencing with your team are happening in every single industry, in every single kind of business, whether a business has four people or 25 people or 250 people. So when you’re a part of a group, you’re not isolated. You’re not alone, and you’re focusing with this group of women on the key issues that I know you need help with. This isn’t a networking event or mastermind. This isn’t a way to make more money. This isn’t a mastermind on how to get more clients. This is a very unique coaching group on how to become an exceptional leader, leading the human capital, resolving the challenges related to human capital, and becoming an expert in the leadership and the management of your company, so that eventually you can hire somebody else to do that like that.

I know that’s a goal of yours, but you can’t do that until you know how to do it yourself. So if this calls to you and you would like to work with me, I really want to meet with you as well. I’m doing 20 minute consults right now with women who have their own business, who are generating $1 million or more in revenue, and you want to work through the specific challenges related to questions like, “Why don’t people get their job done? Why does this have to be so hard? I don’t love my business anymore. I want to get out of here. I hate this.” I understand it’s legit. You get so burnt out on the same rat race and the same hamster wheel, right? So if that’s you and you want to spend 20 minutes with me to see if this is a good fit, go to krisplachy.com/appointment. Find a time that works for your schedule, and let’s get on a call. Like I’ve said before, you will know and so will I in that 20 minutes if we should do this work together. All right, thanks for tuning in.

Hey. Don’t miss a thing. Make sure you join my community at krisplachy.com/connect. Once you join, you’ll get all the information on exclusive and private experiences that I’m offering to my clients. I can’t wait to see you there.

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