Mike Michalowicz founded and sold two companies — one to private equity and another to a Fortune 500 — by his 35th birthday. The author of Profit First, Surge, The Pumpkin Plan, The Toilet Paper Entrepreneur, and his newest release, Clockwork: Design Your Business To Run Itself, Mike Michalowicz is now running his third multi-million dollar venture, Profit First Professionals.
Mike has traveled the globe to speak with thousands of entrepreneurs, and he’s here today to share where many business owners get it wrong. Listen in to learn the key business elements that every entrepreneur needs to understand, what makes it so hard for business owners to separate themselves from their work, and the crucial thing that all businesses need to figure out in order to thrive.
Learn how to separate yourself from your business with @mikemichalowicz, author of CLOCKWORK. #entrepreneurship #smallbusiness Click To Tweet
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On Today’s Episode We’ll Learn:
- Why so many entrepreneurs have so little freedom.
- The true test to see if you can separate yourself from your business.
- Where the biggest results in business come from.
- How Mike’s study of bees led to a key understanding in Clockwork.
- The four key elements that play into every business.
- How to create SOPs while you work.
- Tips for leveraging Parkinson’s law.
- What businesses have to know and protect in order to thrive.
Key Resources for Mike Michalowicz:
- Connect with Mike Michalowicz: Website | LinkedIn | Twitter | Instagram
- Amazon: Clockwork: Design Your Business To Run Itself
- Kindle: Clockwork: Design Your Business To Run Itself
- Audible: Clockwork: Design Your Business To Run Itself
- FREE Clockwork Kit
- Amazon: Profit First
- Amazon: Surge
- Amazon: The Pumpkin Plan
- Amazon: The Toilet Paper Entrepreneur
- Amazon: Parkinson’s Law or the Pursuit of Progress
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Full Episode Transcript:
Welcome to Brainfluence Podcast with Roger Dooley. Author, speaker, and educator on neural marketing and the psychology of persuasion. Every week we talk with thought leaders that will help you improve your influence with factual evidence and concrete research. Introducing your host, Roger Dooley.
Roger Dooley: Welcome to the Brainfluence podcast. I’m Roger Dooley. I’m really excited to have Mike Michalowicz back on the show. We’ve known each other for years, and unlike most of my guests, we’ve actually had a chance to hang out in person more than once. Mike is one of the most creative, and some might add crazy to that, marketers I know. He’s the author of Surge, The Pumpkin Plan, and the oddly titled but very successful Toilet Paper Entrepreneur. He’s a real entrepreneur himself, with a couple of successful exits and a few battle scars that he picked up along the way. And even if you aren’t an entrepreneur, you’ll find that many of Mike’s ideas can be applied in larger organizations, too. Mike’s new book is Clockwork: Design Your Business to Run Itself. Welcome back, Mike.
Mike Michalowicz: Roger thank you so much for having me back.
Roger Dooley: I’m really excited to have you back on because it’s always fun to talk with you. And we had a chance to hang out a few months ago, which was great, but these conversations are always fun. I’m finding you’re getting a little more conventional with your book titles, Mike. You went from Toilet Paper Entrepreneur to The Pumpkin Plan. Both of those were kind of out there. Now, Clockwork. I mean, that sounds like something Malcolm Gladwell might write. So what’s going on?
Mike Michalowicz: Yeah, well, that’s in part the influence of the mainstream community. But also I found it’s interesting … I originally wrote mnemonic oriented titles. Toilet Paper Entrepreneur the whole idea was to associate it with an object … entrepreneurship with an object that you’re not typically associating together. So it’s an easy trigger. Then I went to Profit First, which is a very formula oriented title which the solution to the problem is in the title. I was trying to do the same for Clockwork and could not find it. And I got under the pressure of my publisher, we got to get a title. And I went through, in this case, dozens of titles. Finally we felt that Clockwork explained the outcome of what the business owner wants. A business that runs like clockwork. So yeah, I’m happy with it now that we have the title. I think the mnemonic ones, like The Pumpkin Plan and Toilet Paper Entrepreneur are probably gone permanently. I don’t think future books will have that.
Roger Dooley: Well, no. They were great though. And like you say, they’re very memorable, they stick in your mind. Although Clockwork I think, is a really good title as well. Because it sort of says what you’re trying to accomplish. And it sounds like a book that might be on Wall Street Journal bestseller list. Where Toilet Paper Entrepreneur sold a lot of copies, but I don’t think it hit that did it?
Mike Michalowicz: No it wouldn’t hit it … and controversial title, it’s risky. It resonates with the community but it may not break into the larger consumer base. That being said, The Subtle Art of Not Giving an F … that’s a very unconventional title but was still absorbed by the greater masses. To the point where now it’s become a New York Times Bestseller so those risks do pay off for some authors.
Roger Dooley: Right and I just the other day I saw a post that had that book in the number one slot on a bestseller list. And the number two was UnF Yourself, so-
Mike Michalowicz: So there you go.
Roger Dooley: So I’m thinking that maybe we both need to think about book titles …
Mike Michalowicz: Yeah, maybe.
Roger Dooley: How we can make them a little bit ore aggressive. So I always enjoy hearing about your creative marketing efforts, Mike. Do you have any plan for Clockwork that you can share or are they all top secret?
Mike Michalowicz: No, nothing’s top secret. I believe in sharing everything and what I’ve found is the more I share the more it forces me to come up with new, innovative ideas. Yeah, well, you know the classic idea I’m not doing with Clockwork, I actually snuck my Toilet Paper Entrepreneur books into Barnes and Nobles in stacks of like ten, to about 40 different Barnes and Nobles with the help of friends. And caused this total quagmire in sales when people tried to buy that book and that triggered people discussing the book. And caused Barnes and Nobles actually to buy thousands of copies. That’s a classic one I did.
For Clockwork, what was interesting … I’m really trying to pursue the bulk buys and I now have tens of thousands of dollars of bulk buys. What I did was, I’m teaching a class on how to promote a book. Which is ironic ’cause I’m gonna talk about a class on bulk buys. So what it is, I reached out to my community and said, “Listen, I have a book launch coming out. And I’ve discovered so much in book launches, I’m gonna teach you how to launch a book if you’re in that category.” And a portion of my readership is writing their first book or has already written a book, but they’re struggling with marketing. And I’m gonna teach them in the class how to get people buying books, including bulk buys, which is the exact method I’m using to attract people to the class. So it’s kind of this circular thing. But it really is moving a huge volume of books and it’s outside the box of what I normally do, which is a little more zany stuff.
Roger Dooley: Well that’s great and I’ve got a book that’s probably six months … seven months behind yours in schedule, so I should be signing up for your class and I probably will.
Mike Michalowicz: Well, be careful, ’cause after this interview I’ll be like stalking you now, so …
Roger Dooley: So, Mike, getting onto the idea of Clockwork. I think if you ask most entrepreneurs why they started their business, the first thing they say, or maybe the second would be that they wanted more freedom. But, you know, even though they don’t have a boss now, they become slaves to their business. I’m sure most are happy at putting in long hours for their own account instead of for somebody else. But why do so many entrepreneurs have so little freedom?
Mike Michalowicz: So it’s interesting and this problem is pervasive. It’s not just with entrepreneurs it’s with all types of employees … entrepreneurs of every definition. And what it is is that … the old what got us here won’t get us there. When we start a business or a job, we believe that the more we grind it out, the harder we work, the more our business will progress. And it’s true, to a point.
So an entrepreneur … when I started the business, the definition of an entrepreneur in the early stages is you have to do the work yourself, you’re the Chief Operating Officer, but you’re also the Chief Bottle Washer and everything in between. We see progress in our business, particularly when we work harder. It’s very quantifiable. If I put in more hours, I can see a bigger return. And therefore it kind of primes us to believe, to make more money I must work harder. To make my business grow, I must work harder. So we very early on, we get routinized into this and get stuck in it. Most entrepreneurs can’t get past that. They think that the only way to grow is to work harder.
They also have kind of false positives. They will try to hire someone to see if they can find someone like them, but of course they can’t. There’s no one like you. Then the entrepreneur will get very frustrated and say, gosh this person is not nearly as capable as me. Well, they just don’t do the work you, the entrepreneur, the way you do it. So we get frustrated with them and then we say, yeah, let’s go back to the way it was and do all the work myself again. We kind of … some business will oscillate between doing the work all themselves, the entrepreneur, versus hiring someone and then, they get frustrated and then they go back to doing the work themselves. So we just get … To answer your question, a little more succinctly now … It’s that we get so entrenched and comfortable with doing things the way we’ve been doing them, that we actually just stick with it. As opposed to making a transition in ourselves to experience growth in a new way, with less effort.
Roger Dooley: Yeah, I think it’s tough because I’ve certainly been there myself and multiple entrepreneurial start-ups and it always seems like, yeah, I know that I’ve got stuff that I need to do to make the business better, to recruit that right person, or find a better way of doing something. But it’s always well, right now I’ve gotta get that one big order out, or I’ve gotta fix that one really important customer problem. You just sort of lurch from one big order to the next customer problem and so on. And six months later you really haven’t changed.
Mike Michalowicz: Yeah that is the problem, is that we are in this day to day survival. There is always an urgent need. The problem is, if we always address the urgent and ignore the important, the visionary type stuff, it’ll never come true. So we always have to do it. To the point where I argue, in Clockwork. The first thing we need to do every week is the vision.
One suggestion I made … I didn’t put this in the book, but I tell the person, I said … I was doing an interview similar to this. He said, “What can I do to start having an impact?” I asked him about his office, he said, “It’s about ten miles down the road.” So it’s a maybe a 15 minute drive. I said, “well, when you spend an hour working on your business, so here’s what I ask you to do. You leave the house, you get in the car, you drive to the office, you stop in the parking lot, and there you stop. Your designing time … that’s what I call this time we spend working on the vision of the business and the strategy. Your designing time is that one hour in the car. Do not get out of the car, don’t get on the phone. Just think about the business. Think in new ways, because that is where the biggest results come, is from the strategy and vision.”
And I argue, by the way, so much Roger, that we aren’t thinking enough. We’re doing too much, we’re not thinking enough. That we have to realize, there was a statue dedicated to the most important process that entrepreneurs do, which is thinking. And that statue is The Thinker. I mean, you don’t see a statue of the doer. You don’t see some guy up there just like, oh, just doing things and running … you don’t see some statue of a guy on a cell phone and his mind freaking out. One of the most famous statues is a guy who’s just taking that pause to think. That’s what impacts your business.
Roger Dooley: Yeah, Mike, have you seen that cartoon where they’ve got the thinker and the doer statues? And the thinker of course is sitting there pondering. The doer statue, there’s nothing on the platform, the doer’s out doing things.
Mike Michalowicz: Oh, that’s awesome. I have not seen that. I gotta see … if you find the link to a picture of that, send it my way.
Roger Dooley: I will. So, just a few months ago, you and I co-moderated multi-day event with Sabrina Starling …
Mike Michalowicz: Yeah, down on the Bayou.
Roger Dooley: Yeah, that was fun. I didn’t see any alligators unfortunately, but it was still fun. You know, one of the ideas that she brought up at the event, and you kind of elude to in the book, in somewhat different terms is that entrepreneurs should be able to take a four week vacation. And I think that’s probably beyond whatever the benefits of vacation are, it’s also kind of a symbol for saying that your business is strong enough to survive without you being there for a month. That to me is even more important than the vacation aspect. If you have built a business that can do that, then you have also built a business where you can work on other important things … on growth, on expansion, on different markets and so on. So it goes way beyond the vacation. Based on your experience, how many entrepreneurs do you know that would be comfortable taking a month long vacation?
Mike Michalowicz: Well, initially, very few. People who’ve never done that before are more than reticent to do it, they don’t believe it’s even plausible. Our ego kicks in too, we say do you understand, Mike, how dependent my business is on me? It needs me. If I leave, the business dies. It’s a parent-child relationship. This is an infant business, and I am rearing this child.
Well, the first thing I tell people is whoever believes their relationship with their business is parent-child, I think is a flawed analogy. The idea of course, of a parent-child relationship is that, I am rearing this child to ultimately get it’s own legs and run off on it’s own and then of course, pay me. Once it’s stable on it’s own, it’s now paying me.
But I think the better analogy, is that of conjoined twins. It’s not a parent-child relationship. We share critical organs, we share a heart, we share a soul. And that the … therefore separating the entrepreneur and the business is a very surgical slow process.
When they hear the four week vacation, I think people see it as a simple switch. They say, “Oh, one day I’ll be able to take a four week vacation, but I’ll have to get there.” And I’m saying, “No, no. We gotta start building the surgery … we gotta take these specific steps to slowly disconnect you from the business.” And getting to that four week vacation may be a year or even two years of effort to separate you. But once you’re separated and the business can survive on its’ own, the only test if your full absence. We have to separate you.
The flip side of this too I wanna say is you know, we’re gonna separate the organs, the heart, everything. You will always share a soul. There are some people, myself included, I’ve separated myself from my business and all of a sudden I felt like I had died inside. My ego kicked in an said, “Oh my God, my business doesn’t need me, I feel abandoned.” And then reinserted myself into my business. So, I had to get over that and realize though that I will always be the soul of the business. There’ll be other people that, and things that represent the heart and the critical organs and moving the business forward. But I will always have that influence, that soulful influence, and that’s … that has kind of fed what my ego needed, and has allowed me to do my four week vacation. Which actually is just … my next one is just around the corner.
Roger Dooley: Well, congratulations on that Mike. Another thing I learned about you at that retreat. In addition to be a skilled surgeon, as you just described, that you’re also an entomologist, and it was your study of bees that led you to a key understanding in Clockwork. Why don’t you explain about that?
Mike Michalowicz: Yeah, so I wouldn’t call it … consider myself an entomologist. I got stung by a bee and had a little bit of an awakening. I’d been researching now, what makes businesses efficient. So the obvious way to find this was I started interviewing businesses, I made some visits to companies. I remember meeting this play set manufacturer that had achieved 75 million dollars in revenue and was convinced they had the solution to an efficient business. And what I found is they all did have a solution, but there was no common thread. They all defined efficiency in their own way and had their own approach. That had me frustrated trying to find what the most efficient organization was and what it … where there was a common thread. That’s, by coincidence, the day I got stung, as I was thinking about that … in my garden, I got stung by a bee. That just triggered thoughts. What’s up with the beehive? I never even considered them as an organization.
Well sure enough, beehives are extremely efficient at scaling and they follow a simple system. They know the most critical function of a beehive is the laying of eggs. Their survivability depends on it. That’s what they do, is they will build colonies by constantly producing new eggs. So every bee in there knows that the function of laying eggs is the most critical. Not every bee lays eggs, actually the queen bee is the one who lays eggs. But every bee knows that that function of laying eggs must be protected. If there’s an interruption or it fails, the entire beehive’s in jeopardy. The second rule they know is once that is protected and running efficiently, then they may revert to their primary job function, collecting pollen or something.
What I found, this is the common thread for all businesses. Every business has a core, critical function that the business hinges its’ success on. We need to identify it. Sadly, most businesses haven’t, but it’s easy to. We must identify it, and then, every employee that’s not serving it, must protect those people who are serving it, so that it can be done efficiently. Then, and only then, do they go on to do their primary job functions.
Here’s a tip to finding it, ’cause I’m sure people will be curious. What’s my QBR, my Queen Bee Role in my organization? Whatever you define as your brand promise to the market. What’s the one thing that the market is buying from you? Because it’s … that’s what serves them so well. That’s your big brand promise. Peel back the onion one layer and define the function, the one activity that’s supporting that brand promise, that differentiator. That activity, that’s the Queen Bee Role.
Just as a quick example, Federal Express. They’re known for their on time delivery of packages, right? That’s their brand promise. If it absolutely needs to be there overnight, it will be. That’s their promise. The function behind that, that delivers on that, is their logistics. I’m sure they have good customer service, but that’s not the Queen Bee Role. They could improve customer service, they could have friendlier people on the phones, that won’t have any significant impact. But if logistics improve it does, and if logistics fail it’s not protected, and they say, “Ah, maybe I’ll take longer than we promised, who cares?” The company will collapse. Every business has this. That one function that’s driving their differentiator. Identify it. Serve it. Protect it.
Roger Dooley: So, now how would FedEx do that?
Mike Michalowicz: Well, so FedEx has to … First of all, realize that the people and the processes that are serving that, always get attention. If there’s a logistical problem, they reallocate resources to make sure that comes up and running quickly as possible. The people who are doing customer service. The most important thing that they need to protect is logistics. So if someone calls in and says, “Where is my package?” They need to have quick access to that information. They need to know proactively, oh, one of our facilities had a fire, or something happened. They need to be able to communicate that effectively. So everyone needs to have their finger on the pulse of it, and allow the logistics people to move packages.
Here’s an example for a smaller business, ’cause maybe it’s even more palatable when you look at a small business. A doctor’s office. We all visit doctor’s offices hopefully, for annual checkups. When you go there, you’ll notice, at an efficient doctor’s office, the doctor, she will not be the person checking you in. She will not be the person that’s taking your insurance information. She won’t be pulling your files. She won’t even escort you to the examination room. The only thing the doctor does, in an efficient office that is known for the quality of their examinations. The doctor will be doing the examination and rendering a prescription. And a really efficient doctor’s office, they’ll have maybe three or four examination rooms per doctor. So you sit, and wait. You’re part of the system. You sit there and wait, so the doctor can just line up and shoot down … bad choice of words, but line up and shoot down patient after patient and roll through it, doing the one thing that’s most critical.
Everyone also knows that in an office, if you see a doctor doing insurance claims, we aren’t rendering the most important service we need to render. We are being compromised. So the team needs to be educated, to get the doctor back doing the examinations and prescriptions.
Roger Dooley: Reminds me a little bit of a situation I had years ago. One of my … Actually my first true entrepreneurial venture was a mail order business and we tended to differentiate ourselves from our competition by customer service. Many companies had the same products, but we felt that we had better people and better customer service. But our phone … incoming phone volume was really variable. At certain times of day and depending on whether we had just mailed a catalog, or it had been a few weeks. We might have fifteen lines busy or three lines busy. So planning people was really pretty difficult. But after we learned how to more accurately predict what those cycles were, we would literally pull everybody. We would pull people from purchasing, from accounts receivable, from the front desk. Both I and my partner would jump on the phone if it was busy. Just so that we could maintain that level of customer service briefly. Typically after an hour or so, that surge might pass and people could start reverting to their normal tasks. So that sounds a lot like what you’re talking about.
Mike Michalowicz: That’s exactly it, that’s exactly it. Every business has bottlenecks, meaning choke points as business flows through, or as a project flows through it goes through different stages. And at each stage, someone or something is touching and further developing that offering, whatever it may be. Well, if any stage gets overwhelmed, all the work after it now has no work, because it … the work has been cued up and waiting for this one stage to push it through. So part of clockwork is knowing this flow of business.
Now I call it the ACDC model. Similar to the band, but unfortunately not the band. The ACDC model is this. That every business needs to attract prospects, that’s the A, attract. Convert those prospects into customers, that’s the C. Then deliver our offering, either be product or service. And then collect the cash for that. And sometimes the model is in a different sequence. But those four elements play into every business. Any of those elements, if we have a slow down, everything else after it suffers.
For example, say I’m really doing a great job at attracting prospects. There’s a massive inflow of prospects, but I’m not converting them to customers. Well, down the chain from there is deliverables. I’ll have nothing to deliver, if I have nothing to deliver, I cannot collect cash. So I’ll feel a crunch and I need to go and fix that bottleneck, which is the conversion to get more business flowing through. So we always want to look for the ACDC and see where is the throughput struggling, and open that up.
Roger Dooley: You have a great story in the book, sad story too, about two emergency rooms. Why don’t you tell that one, Mike.
Mike Michalowicz: Yeah, so that is so coincidental, I was literally driving by the Cape Cod Hospital yesterday. I just returned form a trip up to Dennis, one of the towns in Cape Cod to spend some time with family. There were two hospitals that had incidents on the same day. One I think was called King’s County in New York, the other was Cape Cod. But the outcomes were significantly different.
The first one was Cape Cod Hospital were my nephew was brought into the Emergency Room ’cause he had a shard of metal in his eye. The experience was not anything like you’d expect. His father, which is my brother-in-law … his son went into the waiting room and it was packed. Therefore they were expecting to kind of settle in for a long night, because he has a non life threatening issue, and there’s other people there with more severe issues. None the less, he was seen within five minutes. He was being seen by a doctor, the shard was removed within ten minutes, and a prescription filled, which was Advil. He was out the door. Fifteen minutes cumulative in and out.
And the reason Cape Cod was so successful … not in that one instance, but it’s continually. You can go on their website now and google their wait times. The reason is, they understand what their QBR is. Doctors need to see patients. They are not distracted with any other work. They use special methods to protect them. The key is that every employee knows there, that if the doctor is doing anything but seeing patients, we as an organization have an issue.
Now in parallel, the same day there was a woman, I believe her name was Esmin Green, who went to King’s County Hospital in New York City. She was having a mental issue, or a mental health issue I should say. And was brought in there to get a physical exam and a mental exam, mental health exam. When she was brought in, she went to the waiting room, which was packed. Five, ten minutes later where my nephew was coining out of the hospital, she was still in the waiting room. Ten hours later, still in the waiting room. Twenty four hours later, found in the waiting room dead. Deceased. And she had passed from … I think it’s called pulmonary thrombosis. Basically from sitting too long. Your veins in your legs cause a clot, goes to your brain, and kills you.
It’s a sad story, but it had to be explained, because that hospital is better funded, better financed, arguably they have better doctors. Yet, they didn’t perform, and the reason is, I argue, that they don’t know what that critical Queen Bee Role is. Or they don’t care to know what it is. It’s certainly not being addressed. The consequences in this case were dire. What I’m trying to implore for readers is, you have to know the QBR and protect it and you can thrive. And if you don’t, I’m not saying someone’s gonna physically die, but there can be dire consequences to the business. It can devastate a business, not knowing what it is and not protecting it.
Roger Dooley: And businesses die all the time. That’s one thing we know.
Mike Michalowicz: Yes, it’s the reality.
Roger Dooley: Yeah, so, Mike, one of the claims you make in Clockwork is you can create powerful without the need to document things. Now that kind of flies in the face of most delegation gurus, who, they say that the way to sort of extract yourself from the day to day is to write everything down in the form of SOPs … standard operating procedures, so that someone new can come in, and step in to replace somebody else without missing a beat. So how do you … explain what you mean by that?
Mike Michalowicz: So, I was researching SOPs and their use and effectiveness and found, in my research, was this very low uptake in those documents. In fact, it was funny, I started with my own publisher, it’s Penguin Books. And I said, “Hey, I’m doing research for this. I’m researching SOPs. Are they actively used here?” And they said, “Yeah, we have manuals of processes.” So I went to my editor, I said, “Show me the manuals.” And he first fumbled around, he’s like, I can’t remember where it is … oh yeah, here it is. Literally under a stack of books, never cracked open. And I said, “Well, how have you learned, if you haven’t used this?” And he said, “well, just by asking around. No one reads their manuals.”
And this is a place of people who are paid to read, right? So I’m like, wow, if they can’t pull this off, I wonder how other businesses are gonna do. And I found a very similar case in these other businesses I studied. That’s one challenge, is people don’t read tons of documentation. The flip side, is then of course, creation of that documentation. For many entrepreneurs, that’s an extraordinarily arduous task, and therefore it gets deferred. Some entrepreneurs even say, I don’t have any systems now to develop these. I don’t have the time. Here’s what the reality is though. Every business has every system already. And why I’m saying that is, for the business to function, if it’s surviving, it must be doing things. Therefore those functions, those procedures do exist, the problem is, they just exist in people’s heads. They’re not documented or stored in some way.
So what I suggest in Clockwork is the extraction of systems, not the documentation in the traditional sense of them. And what I mean by this is, as you do the work that you want or need to transfer to someone else, record it. You can use screen capture software, you can use audio or video recording, depending on the stuff you’re doing. But simply record it. For example, if you, Roger, do invoicing for the company that we work for, and I am your subordinate, and you now want me to do invoicing. What you would do is invoice one more time, so you’re actually still doing work, you’re producing. But now record it, with perhaps even a voiceover, explaining. I click here and this is why I do this and that’s why and then give it to me. Then, my job is to replicate it, to follow the instruction and do the next invoice. But the final step in this transfer process, that’s very important is, then I make the next video, of how to invoice. I may not even transfer it to anyone, but I have to make the next video. Because ultimately the best students are the teachers. So just giving me a process to follow, while extremely helpful and easy to consume … ’cause now it’s video or audio. The process of then teaching it back, ensures that I understand the process thoroughly and can carry on doing it.
Roger Dooley: Yeah that makes a lot of sense in a couple of ways, Mike. Now when, if I really know how to do something, while I’ve been doing it everyday for years. And I try and explain it to somebody. My explanation, at least the first time out, probably isn’t gonna be that good, because I know how to do these things and stuff that seems really simple and obvious to me, might not be simple and obvious to the other person. So, that makes sense, and then of course it also makes sense in the fact that when you try and teach somebody else something, you learn more yourself. So when that other person goes to document it, by video or screen cast or whatever, they will themselves be cementing that knowledge in their own heads. Great idea.
Mike Michalowicz: Thank you, thank you.
Roger Dooley: As counterintuitive as it sounds, so forget the big paper manuals.
Mike Michalowicz: That’s the thing, it’s kind of a little counterintuitive. The nice thing is, you can do this dynamically. You don’t need to create an entire, you don’t have to do SOPs for the entire business, it’s now just as you transfer the work. The final part I tell people too, create a virtual directory, Google Drive or whatever your storage is. And that directory structure now maintains all these different videos and audios you’re making. And over time, your entire process has been captured.
Roger Dooley: That’s great. I think a lot of those SOP manuals kind of sit on the shelf right next to the five year strategic plan.
Mike Michalowicz: Yeah, yeah, exactly.
Roger Dooley: Neither one of them ever gets opened after they’re created.
Mike Michalowicz: Yeah, it is so true.
Roger Dooley: So, Mike, your ideas overlap a little bit with those of my fellow Austinite, Tim Ferriss and his four hour work week. One thing that Tim emphasizes a lot is outsourcing. I know a lot of your work is about direct employees. How do you feel about outsourcing?
Mike Michalowicz: Oh, I’m a huge fan of outsourcing. I call it alternative sourcing. So the mainstream approach to bringing on people, I think for many entrepreneurs is a full timer. There’s no other real consideration. They say I need to hire someone, and they go in the mindset of full time. But I think there’s another massive work base, workforce base, I guess. That we don’t inherently consider. At least, many of us don’t. Which is, outsourced work, virtual work, which is the same as outsourced, it’s just not locally based necessarily. Contractors themselves which isn’t considered outsourced work, meaning people think of a virtual assistant or something, but any vendor you hire is outsourced work. And part timers.
I believe they’re all outlets. Our vendors can be given SOPs. For example, for all of my marketing material, we have an outsourced person who does this. The company’s called, Innovative Images. They do all of our work, they’ve been doing it for ten years, and they have our SOPs. This is how we want the work done. We have part timers and we’ve thrived on this. Here’s a little behavioral trick, that I know you’re very familiar with, Roger, is that if I give someone eight hours of work to do work, and the work is eight hours worth of work, they are likely to get it, or most of it done within eight hours. If I give a person that’s only working every four hours, eight hours of work, and only give them the four hours to get it done. They will get most of it, if not all of it, done. I found that, time is used in a very flexible, accordion like fashion. In that, if I’m given more time, my consumption of that time expands to meet the work demand. So my part time staff here, is highly efficient. And there’s getting … don’t tell them, you know, I mean, tell them …
Roger Dooley: This is between us, Mike, don’t worry.
Mike Michalowicz: Yeah, this is between us and everyone listening, but they’re doing eight hours of work, in three to four hours. But here’s the best part, there is a workforce out there that is only looking for part time work. I have extremely highly qualified people, extraordinary work ethic, but they don’t wanna work more than three hours a day, because they have other obligations. A couple are women, here, they’re moms, and they wanna be there with their children, yet they wanna work. One guy here has a auto detailing shop on the side. That’s his hobby passion but he wants a career. And he crushes it, but every Friday, he’s at the auto detailing shop, so he’s a part timer with us. We’ve excelled with that kind of work force.
Roger Dooley: Well, a weird coincidence, I was going through some books that had been in storage for about eight years, and found a vintage copy of Parkinson’s Law. He was the one who came up with the fact that … theory that work expands to fill the time available. And he had some great corollaries to that too, but I ended up reading most of it just to refresh myself and it was really fascinating. He wrote that I think back in maybe 1940’s or 1950’s. Still totally true today. I just saw an article at, I think ink.com, that said the average person actually puts in about three hours at work a day. The person who’s nominally working 40 hours per week. So I think you’re spot on with your observation there, Mike.
Mike Michalowicz: Yeah, and it’s funny. I’ve yet to read the Parkinson’s Laws, the book by Parkinson. I gotta read it. But I do hear … I do understand. I read his articles and so forth, it was really a cynical, really, his original concept was just …
Roger Dooley: Oh yeah, it was … he talked about committees and how they do a 30 second vote on a nuclear power plant for hundreds of millions of dollars, but then spend an hour debating building a $2000 shed someplace because nobody could understand the power plant thing, but everybody can understand a shed.
Mike Michalowicz: So funny, so funny. But it really, to me, it seems to be the absolute reality. So I think we can leverage Parkinsons Law, sometimes it can work against us. Where we give our team and ourselves, too much time to complete tasks. But it can work to our advantage when we compress that time. Sometimes setting these quote unquote “unrealistic demands” on ourselves and our colleagues, it’s amazing what we can pull off.
Roger Dooley: Well, maybe that’s a good place to wrap up, Mike. I think that Clockwork is one of those rare books that is gonna help people, not just with their business problems, but if they follow what’s in there, it can make them a lot happier in their personal life too. And I know that your readers are gonna love it. So let me remind our listeners that we are speaking with, the one and only Mike Michalowicz, author of multiple best-selling books, and the brand new title, Clockwork: Design Your Business to Run Itself.
Mike, I see that you’re offering a free Clockwork kit. How can people find you online and check out Clockwork?
Mike Michalowicz: Yeah, so thanks for letting me share. So Clockwork of course is available at Amazon, your favorite bookstore, airport, wherever you wanna get your book. Amazon usually has the best deal, so that’s my suggestion. For the first time ever, I’ve actually set up a complimentary, it’s totally free, educational video series. And PDFs and worksheets to roll out Clockwork. Because what I discovered is Clockwork is not just for the entrepreneur to execute exclusively. As their employees are working for them, and bringing about more efficiency. They too need parts of the Clockwork system. So that’s all available through the Clockwork kit. It’s all free. To get it simply go to clockwork.life because I do wanna make this a lifestyle. Clockwork.life Go there and you can get the Clockwork kit immediately and download it for free.
Roger Dooley: Great. Well, we will link there and to both Clockwork and your other books, Mike. And to any other resources we talking about on the show notes pages, at rogerdooley.com/podcast. Mike, it’s been great to have you back on the show. We should do this more often.
Mike Michalowicz: Oh my gosh, I have so much fun with you every single time. Thanks for having me.
Roger Dooley: Thank you for joining me for this episode of the Brainfulence podcast. To continue the discussion, and to find your own path to brainy success, please visit us at rogerdooley.com.
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