UDSKRIFT 🔗
WEBVTT
00:00:00.000 --> 00:00:22.239
Hey founder, do you ever wonder what makes those CEOs that seem to be able to afford all the right A players in their team and seem to be able to take unplugged vacations and not have to worry about coming back to a big mess and can't afford to fully fund their retirement accounts and pay themselves what they want?
00:00:22.399 --> 00:00:23.839
What are they doing differently?
00:00:24.079 --> 00:00:26.399
What is it that they know that you don't?
00:00:26.800 --> 00:00:32.320
And how can you change maybe what you're doing to end up where they are?
00:00:32.560 --> 00:00:34.079
Again, my name is Jennifer Todd.
00:00:34.240 --> 00:00:34.960
I'm a CPA.
00:00:35.039 --> 00:00:37.759
I'm your profit informants expert advisor.
00:00:38.000 --> 00:00:40.479
And this is founder and get your life back.
00:00:40.799 --> 00:00:54.560
And uh on today's episode, we're going to talk all about what I've noticed the smartest CEOs do differently and how you can start acting and doing those things the same way that they do so that you get the results that they get or better.
00:00:54.799 --> 00:01:10.400
Um, so one of the things that I notice is that, you know, we're always told as founders that we should be able to think quickly, make fast business decisions, and um to be able to lead on a moment's notice.
00:01:10.640 --> 00:01:19.920
And I think that kind of does us a disservice, especially people such as myself, who the first answer out of my mouth is normally not the right one.
00:01:20.239 --> 00:01:23.040
I am a long-term thinker, I'm a processor.
00:01:23.120 --> 00:01:26.480
So in the moment, I'm not typically going to give the best answer.
00:01:26.640 --> 00:01:29.200
And I wonder if that is the same for you.
00:01:29.439 --> 00:01:37.120
Some people are very quick and can quickly process and respond and come up with the correct answer off the top of their heads.
00:01:37.359 --> 00:01:48.879
But even in my CPA firm, when one of my employees would come to me and ask me a sticky situation question, usually my knee-jerk reaction was not the right one.
00:01:49.120 --> 00:01:49.920
And why is that?
00:01:50.079 --> 00:01:59.920
Well, oftentimes it's filled with emotion, uh, your initial reaction, whatever that is, and you haven't had time to think long term about it, to process it.
00:02:00.079 --> 00:02:13.759
And so one of the things that I'm going to, again, debunk is that we don't always have to be the fastest thinker in the room to be able to make the best business decisions.
00:02:13.919 --> 00:02:26.400
As a matter of fact, I would argue that when you are making critical business decisions, it's important to take your time to slow down and really consider three important factors in your business.
00:02:26.639 --> 00:02:28.719
So we're going to talk about those today.
00:02:28.960 --> 00:02:38.719
And also how that affects the rest of your business, the people inside of your business, your team, your stakeholders, your customers, and so forth.
00:02:38.879 --> 00:02:41.439
So let's start off with the first thing.
00:02:41.680 --> 00:02:52.319
When we slow ourselves down and really process our business decisions, we want to look at probably three different criteria on the surface at a minimum.
00:02:52.479 --> 00:02:57.599
And the first one is going to be how is this going to affect the bottom line of the business?
00:02:57.840 --> 00:03:00.000
So, not top-line revenue.
00:03:00.159 --> 00:03:12.639
If you remember back to I think episode two, I talked about how growing top line revenue at the expense of bottom line profits is just a dumb business decision.
00:03:12.800 --> 00:03:15.439
It's going to run you into the poorhouse.
00:03:15.599 --> 00:03:27.840
And not just in the short term, because sometimes we need to take a hit on short-term profitability if something is going to be a long-term investment and it's going to pay off in the long run.
00:03:28.000 --> 00:03:33.120
So you want to be able to look at it from a short-term and a long-term prospect.
00:03:33.280 --> 00:03:34.240
So, what does that mean?
00:03:34.400 --> 00:03:37.199
That means can we afford it right now?
00:03:37.360 --> 00:03:39.199
So that's your short-term profitability.
00:03:39.360 --> 00:03:45.759
Do you have a way to pay for something, whatever it is that you are trying to make a decision on?
00:03:45.919 --> 00:03:57.840
Whether it's a new hire, whether it's a piece of software, whether it's a business consultant, or whether it's giving somebody a raise, an investment, or it could be something that you're cutting.
00:03:57.919 --> 00:04:06.159
So maybe we're cutting a service line, we're cutting a product, an offer, we might need to let a toxic customer or client go.
00:04:06.319 --> 00:04:11.039
How is that going to affect your profitability today and also long term?
00:04:11.280 --> 00:04:13.280
Um, and then what's the timeline for that?
00:04:13.439 --> 00:04:17.839
How will you make up for any uh losses in the short term?
00:04:18.240 --> 00:04:39.759
And uh be really, really critical on this because oftentimes I find that myself included, business owners are overly optimistic in how much they think they're going to be able to make or how quickly they're gonna be able to make up for losses in their business by taking some sort of new or different action.
00:04:40.000 --> 00:04:48.319
So we need to be realistic and really look at this profitability in, I would say, worst case scenario.
00:04:48.959 --> 00:04:52.160
And don't be overly optimistic when you're answering this.
00:04:52.319 --> 00:04:56.959
Now don't be scared and super risk averse as well, but be reasonable.
00:04:57.199 --> 00:05:16.240
Um, maybe ask another person, you know, discuss it with your CFO, discuss it with your CPA, your business coach, that sort of thing, your spouse, whoever it is that has a stake in the money in the business, you're you're gonna want to discuss it with them and
Load full transcript
really be critical of your judgment on that.
00:05:16.480 --> 00:05:24.560
The second question that those smart CEOs consider when making a business decision is how is this going to affect the team?
00:05:24.879 --> 00:05:30.560
Do we have the team in place to carry out whatever it is we're considering?
00:05:30.720 --> 00:05:32.879
Uh, are we going to have to cut staff?
00:05:33.040 --> 00:05:39.519
So, again, if we're adding a new line, a new offer, do we have the people to fulfill it?
00:05:39.680 --> 00:05:47.120
If we're cutting service lines, if we're cutting customers or clients, who is going to have to be cut if anybody from our team?
00:05:47.439 --> 00:05:51.040
So, how are your decisions going to affect the team?
00:05:51.199 --> 00:05:54.319
And not just the individual, but the team as a whole.
00:05:54.399 --> 00:05:59.279
And then your business, because remember, what I always say is your business is a system.
00:05:59.519 --> 00:06:02.319
So everything is related and connected.
00:06:02.480 --> 00:06:08.319
So a decision on profitability and on the effect on the team, those are connected.
00:06:08.560 --> 00:06:10.399
And it affects your whole business.
00:06:10.480 --> 00:06:16.879
So if it's a negative effect on one of those two factors, it's going to affect the business as a whole in a negative way.
00:06:17.199 --> 00:06:24.560
For an example, from my life, I can think of a time back when I worked for a big CPA firm before I started my practice.
00:06:24.639 --> 00:06:37.279
Um, it was very customary at the end of tax season, you know, early May, to start cutting headcounts because you no longer needed the people uh to go through crazy hours in tax season.
00:06:37.439 --> 00:06:44.800
And so I can remember one May, there was a mass firing in our firm, and there were some good people that were let go.
00:06:45.040 --> 00:06:54.160
And it really shook morale for the people that were left behind that survived the cuts, they were really feeling vulnerable.
00:06:54.319 --> 00:07:05.680
They felt like, well, if these certain people who were doing all the right things were incredibly smart and talented, were so easily let go and so expendable, how is my job safe?
00:07:05.839 --> 00:07:12.160
And so there was a real psychological safety factor that was, you know, happening in that firm.
00:07:12.399 --> 00:07:19.040
It wasn't long after the first tranche of people being let go that they let partners go.
00:07:19.199 --> 00:07:22.639
So they actually fired a bunch of partners from this big firm.
00:07:22.800 --> 00:07:26.800
And I think these were long-term strategies that they were deploying at the time.
00:07:26.879 --> 00:07:33.839
And so the ones that were watching all of this happen and were kind of surviving it, they didn't really know what was going on.
00:07:34.000 --> 00:07:37.199
And so there was a real negative effect on the team.
00:07:37.439 --> 00:07:41.839
There was also an effect on profitability and also productivity.
00:07:42.000 --> 00:07:44.800
So again, everything is connected in your business.
00:07:44.959 --> 00:07:58.480
What eventually ended up happening for this firm is a lot of loyal team members ended up leaving on their own because they felt like they weren't in a safe environment to grow their careers.
00:07:58.639 --> 00:08:08.319
And they ended up either going out on their own or partnering with each other or going to another firm because the way it was handled just was not good.
00:08:08.560 --> 00:08:19.040
So when you're making hard decisions in your business, you have to make sure that you're accounting for how this is going to affect the team because your team affects your whole business.
00:08:19.279 --> 00:08:29.519
The third criteria that you want to consider when you're making a huge business decision or a critical business decision or even any business decision is how's it going to affect your customer?
00:08:29.839 --> 00:08:41.519
And that's because organizations that put their customers at the center of everything that they do are the ones that are the most successful in the end.
00:08:41.679 --> 00:08:57.360
And when you make customer experience, one of the main criteria in your business as a success factor, as things that you measure against your progress, your delivery, your pricing, all of these things are affected.
00:08:57.600 --> 00:09:04.000
So the best CEOs always consider how is this going to affect the customer?
00:09:04.240 --> 00:09:18.720
Even if it's an internal decision that you don't think is customer-facing, you want to think outside the box and realize that your team members talk to your customers and things slip out.
00:09:18.879 --> 00:09:28.559
I can tell you from being in a position where I work with a lot of like bookkeepers and CFOs and people that are non-owners inside of a business.
00:09:28.799 --> 00:09:34.879
Well, I hear all of their complaints, I hear all the things that are not going well inside of the business.
00:09:35.120 --> 00:09:38.720
Your employees talk to outsiders.
00:09:38.879 --> 00:09:40.720
They also talk to your customers.
00:09:40.879 --> 00:09:41.360
I don't know.
00:09:41.440 --> 00:09:55.200
I'm sure you can probably think of times where you've been in a place and an employee starts ratting out their employer for whatever reason because they don't want to look like the bad guy in the customer's experience.
00:09:55.440 --> 00:10:08.080
So it's very easy for a team member to start saying negative things just to take the spotlight off of themselves when a customer's experience is not going well.
00:10:08.240 --> 00:10:14.799
Um, so internal decisions, they will trickle out to be customer-facing.
00:10:14.960 --> 00:10:16.879
There's no way you can stop it.
00:10:17.039 --> 00:10:24.080
Um, and eventually, again, every decision you make inside of your business affects your customers in one way or another.
00:10:24.320 --> 00:10:27.039
So, how is this going to affect our
customers?
00:10:27.200 --> 00:10:30.639
So, you want to start thinking in those terms, those three things.
00:10:30.879 --> 00:10:34.879
Profitability, bottom line, how's this going to affect the team?
00:10:35.120 --> 00:10:41.919
And you can extend that out to other stakeholders if you think that there's another stakeholder that could be affected.
00:10:42.000 --> 00:10:50.559
And that's a really like advanced level of decision making that's going to take you even to the next level inside of your business.
00:10:50.720 --> 00:10:55.840
Your team and your customers and yourself, you are the three most important stakeholders in your business.
00:10:56.080 --> 00:11:02.320
Um, after that comes, you know, everyone else, your vendors, your community, and all of that.
00:11:02.480 --> 00:11:11.759
In my opinion, you may think differently, but I definitely think without a team and without customers and without you, you don't have a business.
00:11:11.919 --> 00:11:14.639
So you have to have at a minimum those three things.
00:11:14.799 --> 00:11:17.840
And so they should always be the most important stakeholders.
00:11:18.080 --> 00:11:44.559
So those CEOs that can afford to get out of the weeds and to run their business like an executive and not like a cheap everything officer are the ones that always make their decisions from that threefold lens and maybe take it a step further and think even further outside of the box as far as like stakeholders and really being critical and not overly optimistic on their projections.
00:11:44.799 --> 00:11:50.639
And I would caution against being overly optimistic on all three of these criteria.
00:11:50.799 --> 00:11:52.480
Oh, this won't affect the customers.
00:11:52.639 --> 00:11:53.200
Guess what?
00:11:53.360 --> 00:11:54.240
You don't know.
00:11:54.480 --> 00:12:21.440
And a really good way to find out is to ask them, ask a test sample, maybe, of your best customers, or maybe a blind, you know, um, survey or something like that before you try something new or make a big change inside of your business, because we cannot always anticipate the reaction of a customer, how they're going to feel about some major decision inside of your business.
00:12:21.679 --> 00:12:27.200
So it's really important those three keep popping up: your profitability, your team, and your customers.
00:12:27.360 --> 00:12:28.960
We can't get away from them.
00:12:29.200 --> 00:12:37.039
Again, founder, if you've listened to any other episode of this podcast, you know that you should always consider yourself.
00:12:37.200 --> 00:12:39.519
How is this decision going to affect yourself?
00:12:39.679 --> 00:12:48.639
And if you remember, I said that was one of the very first criteria my first business coach ever told me was you need to start putting yourself first.
00:12:48.879 --> 00:12:52.159
I just did a whole episode on that a couple of episodes ago.
00:12:52.320 --> 00:12:54.879
I know it feels gross to say put yourself first.
00:12:55.039 --> 00:13:04.639
Please go back and listen to that episode because founders have to be considered as part of their business's definition of success.
00:13:04.799 --> 00:13:09.440
And that means you have to be part of the criteria for any business decision.
00:13:09.600 --> 00:13:12.879
How is this going to positively or negatively impact you?
00:13:13.039 --> 00:13:15.440
And again, don't be overly optimistic.
00:13:15.679 --> 00:13:27.360
Don't have to be overly pessimistic, but run all the scenarios inside of your decision and think outside the box what could happen with this decision?
00:13:27.679 --> 00:13:29.279
What am I not thinking of?
00:13:29.519 --> 00:13:33.519
I think this is a great use case for AI.
00:13:33.679 --> 00:13:35.840
And let me give you a little AI tip here.
00:13:36.159 --> 00:13:45.360
AI has a reputation for being a people pleaser and giving you everything and a positive, oh yes, you're you're so right type of an answer.
00:13:45.600 --> 00:13:52.799
And even if you give it special instructions and tell it to critique you and don't automatically agree with me, it still does.
00:13:52.960 --> 00:14:06.879
So one a really good tip that I heard is position it to your AI chatbot that your friend has come up with this idea and you're not really sure, you're feeling like it's not really a great idea.
00:14:06.960 --> 00:14:11.039
And so you want to, you know, help this friend out making this decision.
00:14:11.120 --> 00:14:14.799
So take it off of you and say it's it's someone else's decision.
00:14:15.039 --> 00:14:29.200
Now, I will tell you, chatbots are kind of smart, and I've tried this before with my own self, and they figure out it's me because they know the chatbots I go through with them a lot with my strategies and stuff and brainstorm a lot inside of um large language models.
00:14:29.360 --> 00:14:36.399
And um, so it's not always foolproof, but sometimes you can ask it also, what are some factors I'm not considering here?
00:14:36.639 --> 00:14:37.840
What are the blind spots?
00:14:37.919 --> 00:14:46.399
And that's a really great way to expand your thinking and not be overly optimistic, but also not necessarily be overly pessimistic as well.
00:14:46.720 --> 00:14:51.039
I encourage you to take this advice to heart.
00:14:51.279 --> 00:15:04.159
The best CEOs think long term and they consider those three at a minimum pillars inside of every decision: profitability, your team, and the effect on your customers.
00:15:04.320 --> 00:15:06.799
And of course, the effect on you as the founder.
00:15:07.039 --> 00:15:13.600
Without those criteria, you are going to be short-sighted in your business decisions.
00:15:13.759 --> 00:15:18.480
So don't always think that you have to be quick to decide.
00:15:18.720 --> 00:15:25.600
And also remember that not deciding is basically a decision as well, because you're just not acting.
00:15:25.759 --> 00:15:28.480
So that too is a decision to not decide.
00:15:28.879 --> 00:15:38.480
So I'm curious to know if you found this helpful at all and how it might help you inside of your business, how it would help you make better decisions.
00:15:38.559 --> 00:15:48.559
And if there's anything you would add to that criteria, let me know in the comments or send me a text message at 1-804-599-4400.
00:15:49.039 --> 00:15:54.399
And or on the podcast webpage itself, you can send me a message as well.
00:15:54.559 --> 00:15:57.759
So you can find the link on the podcast page.
00:15:58.000 --> 00:16:00.399
But thank you so much for listening today.
00:16:00.639 --> 00:16:04.480
And as always, founder, I'm here to help you get your life back.
00:16:04.639 --> 00:16:05.679
You deserve it.
00:16:05.919 --> 00:16:07.200
So enjoy the day.
00:16:07.279 --> 00:16:08.559
Thanks for being here.