Podcast Episode 19 with Transcription – Rem Oculee

Rem Oculee:

Welcome to the Exit Mindset Podcast. I’m Rem Oculee. 15 years ago, when I was trying to sell one of my companies, I couldn’t get what I thought was the right price for it. I realized I had things set up the wrong way, even though the company was profitable. So, I spent years researching and studying exit strategies to improve my company’s valuation. I discovered that the same process that improves valuation would improve business profitability and give me more free time. I’m here to show you what I have learned. You see, the best way to grow your business is to look at it from the perspective of someone who’s going to buy your company. Once you start thinking that way, magic happens, and you start seeing things you could not see before. But that’s not all, I also discovered the three principles that you must know to command a better price for your company. The three principles are first, the product, second, the infrastructure, and third, the conversation you have with the consumer. Once you master these three principles, you will be on your way to increasing your profits, your company valuation, and get more work-life balance. So, listen in and learn how you can do that. I will teach you through this podcast, lessons from the trenches, and we will have a dialogue with some of the greatest minds on the planet.

In your day to day, do you feel that you’ve been yanked around a million ways and you lack focus? I’m going to give you the secret today. In the Exit Mindset podcast, we’re going to talk about the type of brains you have and how many brains you would have. And you might be going, “What is he talking about? What do you mean how many brains I have? I only got one.” I’ll propose to you that you got more than one brain, and the way it works is this way. Every time you undertake an activity, you’re using a different kind of brain than the activity before. Let me take an example. Let’s say you’re working on what you do day to day, and you are working on product development. And all of a sudden somebody comes to you from marketing and asks you to do something for them.

Well, basically, you’re going to have to stop all the thinking that was involved in product development, reorient your thinking to marketing; start tackling the problems you have at hand. That process by itself would take several minutes, if not more than that. It might take as long as half an hour sometimes, just to get yourself grounded back into that other issue you’re dealing with in terms of marketing. So, you basically took your product development brain and reinstalled a new brain now, which is a brain you have, but it’s the marketing brain. You got to put that on. And every time you do that, you are going to be dealing with a realignment in the way you think, and you have to shift your thinking. I call it, you have to uninstall a brain and install a new brain from a different perspective. And if you pay attention to that, you’d find it to be an actually true phenomenon.

That every time you’re doing something, and you have to shift to something else. There is definitely a time where you have to adjust, you have to reacclimate your head. Sure, from your perspective, it sounds very normal. Very natural.

Well, I’m moving from this to this, to that. But the reality of it is, is that your thinking becomes completely aligned in a different way, when you start going in that other direction. The problem with reinstalling a different brain, when you’re doing a different job, is that you have to be cognizant that there’s a downtime in between. So, it’s not as simple as you move from one to the next, and nothing happens. There are a lot of things that happen in between. And if you’re running a company, you need to understand that to be able to effectively perform, you have to do that in a very seamless way and as efficiently as possible. But there is another side to that, that affects the people that work for you more than it should affect you. And that is, you might have a tendency to have your employees and your team do different things that don’t relate to the job that they do, throughout the day.

And what that will cause is a lack of focus and will create inefficiencies in the process you’re undertaking. So, in the Exit Mindset, your objective is to build a company that gives you more profits, gives you more time, and have higher valuation. Let’s talk about from a perspective of valuation. If somebody wants to come in and buy your company, and they see your people are yanked around in multiple directions. And they have to move from one place to the next, throughout the day, without it being able to focus on one area that they would be able to focus on without having any downtime. Would you buy that company? You probably wouldn’t. If you yourself are buying a company and you see that the jobs are intermingled, and people cannot even focus on one job, one area. You’re going to go, “This is not scalable.” And also, it wreaks havoc on the company, because everybody’s being yanked around left and right.

This is not an uncommon phenomenon with smaller companies. With larger companies, it gets a lot better. In fact, larger companies carry to an extreme. So, what smaller companies do, they are forced sometimes to have one person or multiple people doing multiple things. And with larger companies, they have one job that can be done by two people that have four or five people doing it. And that’s what the differentiation is. But however, if you look at the profitability per person for a larger company, compared to a smaller company, typically it’s higher. And of course, there are exceptions to the rule and that’s something I always look at when I look at infrastructure. What are the revenues per person? So, when you look at that, if you see that being low, you need to realize that the reason for that is probably because everybody’s doing something else other than what their supposed to do.

They’re doing multiple jobs. And when they’re doing that, essentially, it’s not very efficient because every time you take them from one type job to the other type of job, they really have to completely realign their brain and think in a new way with the other job that they have to do. So, this particular area of focusing on what people do, relays to the infrastructure part of the company. And remember in the Exit Mindset, we look at three things: the product, the infrastructure, and the conversation. So, when a buyer comes to buy your company, they’re going to try and figure out what your employees are doing. And when they see a phenomenon where there’s chaos, where there’s lack of specialization; the value of your company degrades. What we have talked about in the past is when your infrastructure isn’t scalable because you haven’t built the right units in it. And that’s a conversation we’re going to continue to drive through throughout, to help you anchor and ground that material.

But ultimately, when it comes to your employees and the way they perform their work; definitely if you have a situation where your employees are spread thin and they’re doing multiple jobs, the value of your company isn’t going to be perceived as high as one where there is specialization. What you want to do is have the ability to have a person doing one thing, and then you can add one more person to compliment them. That way you can scale up. And if you have that kind of situation, then a buyer of your company is going to definitely look more favorably at it. Now, we always talk about this and I’m always going to bring it back to the same thing. If the buyer of the company is going to look at it favorably because your company is scalable, wouldn’t that mean that your company is performing in an optimal manner? And the answer is, yes. Your company will be performing better simply because you’ve got people that are specialized working in their own area, and they don’t have to shift their mind or their brains from one thing to the next and wreaking havoc. Not just on their psychology as they do the job, but on the performance itself.

And plus a lot of downtime in between shifting from one thing to the next. So, biggest thing you can take from this is that focus on how you can take the jobs and the positions you have and make sure you strive towards making one job, one person. Not one person, two jobs or three jobs or four jobs or five jobs. So, I’m going to give you solutions here. So, the first thing you’re going to do, you’re going to look at your teams, whether one, two, three, or four or more, it doesn’t matter. So, you list them. Then you start listing what each one of them is doing in terms of core functions. So, if your marketing person is answering the phone sometimes, and also doing customer support, you got to write this down. You don’t, you don’t need to write every small little detail that they do throughout the day.

Are they doing marketing? Are they doing phones? Are they on customer support? Are they doing, are they doing all three? If you determine that that person is doing all three, then you write it down. You go to the next one, and next one, next one. Until you list all your team on the sheet that we’re going to provide you here. And to get that sheet, go to the exit mindset.com/tools, and look up the sheets related to the podcast. I’m giving you a very simple and practical way to figure this out. So, what you want to do is once you list them, and once you identify who the people are, and once you identify the type of jobs they’re doing, then you’re going to go to the solution. And the solution is in the third column of that sheet is, “Which resource can I add that’s going to help me solve the problem?”

See, what you want to do is prevent anyone from uninstalling a brain that you need focused on one thing and have them install the other brain that focuses another thing. When you do that, gigantic thing could happen to your company because you’re going to be able to scale up, and if your people are going to be focusing and going to be happier. Plus, they’re going to be able to do the job better. So, in the example I just gave you earlier with the marketing person, sometimes answering the phone, sometimes dealing with the customer, and then the next thing comes up. Some customer support issue comes up, and now they uninstall the phone aspect and go to the customer support. And then you got to install the customer support brain, go back to the marketing brain. All this wreaks havoc on the process that you have.

So, what I would do is take that sheet and start working at it, hash out all these things. And the most important part of it is to start looking at the resources you have and figure out how can I add one more resource to it. Now, the resources could be multiple ways. It doesn’t have to necessarily have to be, you have to go hire one more person. So, for example, if your marketing person is also helping with your customer support, then trying to figure out how we can take that customer support in another way; where it’s more scalable and practical. Your customer support could be, in some instances, outsourced, it could be somebody who might be even part-time in your company. It could be actually reassigning it to a lower priority level at the company from marketing. So, for example, let me give you a simple case in point.

Let’s say you have your marketing person, and let’s say you have somebody in the company that is doing say shipping, I’m making it up completely. Is it possible that person doing shipping can deal with customer support? Because shipping from a brain perspective, may not necessarily take as much intense brain activity and brain intensity as marketing does. And when a person shifts their mindset from shipping to customer support, it might be a little bit easier shift. And also, the priority of the shipping, as far as your company goes, when it comes to solving customer problems is a little bit lower than marketing. Just leaving their work and focusing other activities. So, again, you try and solve the problem gradually sometimes. Sometimes you can’t just go out there and hire 10 people, 15 people, just to do the work that you need. But a lot of it begins with the planning.

A lot of it begins with the intent. If you start having the intention, “I’m going to do that,” and you write it down, you’re going to find a lot of power in it. Some of the solutions I’m going to give you are not necessarily going to be one, two, three, and then it’s solved. A lot of it comes in from the fact that you have to be psychologically predisposed to doing something a certain way. When you start doing it in that way, it’s going to start working. I cannot tell you how many times I’ve done this over and over again. I create a plan, I look at it, I try to make it work, it doesn’t work. But after a little bit of time, starts to work, and then from there on you take next step, and next step, and next step. And that’s what’s going to happen to your teams too.

And if your teams get adjusted to that process of starting something, working it, it doesn’t work. They keep at it; they keep being reminded of it. Next thing you know, it will work. So, not only you need to think like a buyer of a company, you have to sort of orient your employees thinking to think that way too, to a degree. But you can’t go out there and tell your employees that, “I only think like a buyer of a company,” because sometimes they may misconstrue that into the fact that you want to sell the company. And most people don’t like to see their company sold, and remember, that’s the whole purpose of what we’re doing. Is not just sell your company, but to improve your company in a way that makes somebody want to buy it. But you’re keeping it to yourself and keeping everything you’ve got, only doing it better. So, what you want to focus on is one person, one job, one brain that does not need to focus on another job, another job, another job. Thereby uninstalling your brain from this job, uninstalling the brain for the next job, and uninstalling the next one, to the next one, on and on, and on, and create a lot of inefficiencies and a lot of downtime.

What you’re about to embark on is going to change your company profoundly. I know if you take that process, you take it seriously, you keep at it. I know will make a difference. Remember, action is everything. Use it or lose it. I’m Rem Oculee, and I will see you next time.

You’ve just listened to the Exit Mindset Podcast with Rem Oculee. If you haven’t yet subscribed or followed, please do so in your podcast listening app. Or better yet, visit exitmindset.com to join the conversation, access the show notes and discover our bonus content. Lastly, we want to help as many business owners as possible. If you know anyone who could benefit from the information given in this podcast, please feel free to share it with them. Until next time…

Have a question? Email it to Rem at askrem@exitmindset.com .