How to Hire Your Essential Number Two: From Founder to Freedom with Lloyd Thompson

Lloyd: [00:00:00] I think the number one challenge I would speak to that we see in business is clarity. So, the reason the founder is not letting go is because they feel some discomfort that it's not all going to happen. And so a lot of this boils down to clarity, which largely boils down to accountability. So if everyone knows exactly what they own and there is some tangible measure to see whether it's working.

The founder can start stepping away and go, okay, I can see this is working. ​

Allan: Welcome to the Lean Marketing Podcast. I'm your host, Allan Dib. On Lean Marketing Podcast, we look at how to do more with less. And today I've got a very special guest on. His name is Lloyd Thompson. He is the founder and director of VirtualDOO, a company that helps you Get a virtual director of operations in your business.

So really in [00:01:00] this episode today, we're going to be talking about what I think is probably the most important role in your business, which is the number two person, the person who really runs the operation. So, welcome to the show, Lloyd. How are you?

Lloyd: Allan, very good. It's Friday. I've been out down the beach this morning. I'm feeling energized and now I'm talking to you. This is

Allan: Oh, nice.

Lloyd: Ha.

Allan: So one of the biggest blocks for entrepreneurs that I've seen is that a lot of entrepreneurs are ideas people, they're the visionary. So to use traction terminology, there's the visionary and there's the integrator, right? So, the visionary, you know, comes up with the big ideas. They're usually good deal makers.

Uh, They've got. Five ideas every minute but they're not great at implementation. And, you know, I'm talking about myself really, I'm describing exactly who I am right now. And the problem with that is you have tons of good ideas. You have a lot of things brewing, but you're not getting them done.

You're not getting them through to a hundred percent, which is where the money is, right? It's, [00:02:00] you know, as I often say, 80 percent out the door is better than a hundred percent in the draw, right?

And so you really need that role in your business, the person who's the doer, the implementer, or overseeing the doing and implementing and making sure that your vision gets done and checking off all the boxes.

So I'd love to hear your thoughts on this. I mean, you've got a lot of deep experience in training and also I believe you, you have like a fractional COO kind of service. So I'd love to hear your thoughts on it.

Lloyd: I think you've explained that really well in terms of the visionary. And so I find that typically the visionaries that I've worked with are those high creative, all of the big ideas, is. And that has been one of the reasons why they've had their superpower and they've been able to grow their business but the downside of that is that they have these bazillion ideas and they don't get to implement. And so the front end of their business is strong. They've got all these products, they've got all these ideas, but often [00:03:00] then when you look back behind the business, the things like, the more repetitive things like are the rhythms in place?

Have they got dashboards for measuring things? Have they got feedback loops and planning things? That stuff destroys their soul. And so that's not their strength. They don't want to be spending time there. And so, when they've got enough budget or time where they can allocate someone into this role, that's when they get some real traction.

And so, someone who can come in, help them prioritize, and just make it happen with the team. Ha

Allan: Certainly relate to that because you know, all of that stuff, dashboards, metrics you know, going into the detail of financials and all of that, that is just stuff that is, on my list, and then I'm, you know, doing the dishes, I'm cleaning stuff that I've never cleaned

Lloyd: You're putting it off, you're like, I know I don't want to do

Allan: Exactly.

Exactly. I'm tidying up my office. I'm like, you know, God damn it. I just don't even want to look at this stuff. And so I've been fortunate that in my team, I've got an [00:04:00] amazing team of doers, people who actually do this stuff. And like I said, I believe that the number two role is probably the most important role in the business.

Often, you know, You know, as the founder, as the CEO, whatever you are, that visionary, you are that person with the ideas, with the vision, with the new idea single day and I think. a good number two will enable you to do if you're the number one, they're the number two.

In fact, the vision is to become the number zero, right? So, and which is something that I've been fortunate to do where I'm not at all involved in the day to day running of the business. I get to work in my genius zone, which is creating content, writing books you know, connecting with people at events and things like that, really building bridges and things like that with other high performance people.

So that's something that I really enjoy. That's something that's in my genius zone. And so my CEO runs the business. Then we've got a COO who runs the kind of day to day operations, making sure that. You know, the coaching programs running well, doing [00:05:00] all of that sort of stuff. So, it kind of reminds me, but it really stuck with me many years ago, I heard an interview with Richard Branson and the person asked him, how do you run all these dozens of companies?

You know, you've got a mobile phone company, you've got a, you record company, you've got you know, airlines and things like that. And he said, well. You know, I don't there's no possible way I could possibly do that. I just hire really good people and just kind of get out, out of their way, you know, because there's no possible way I could be in all of those places.

And, you know, when we look at Richard Branson, most of his time is spent on Necker Island, you know, networking with people and having fun

and, jumping out of balloons and all of that sort of stuff. And I think that's the dream for a lot of entrepreneurs to become. To go from being number one to number zero, really and not involved in the day to day, but still work in their genius zone working on new product ideas, working on new initiatives.

So to be able to do that, you really need to get that number two, that COO, that integrator in your [00:06:00] business really sorted out. What are the biggest roadblocks for people in doing that? is it cost? Is it that they don't know who to hire? They hire the wrong person. Like what's the

You

You mentioned a few of them there. I think for me, when I'm making this work with clients, first of all, they need to have a team like that. And they've normally started with, they've outsourced admin. So that's a good start. They're not doing trivial administrative tasks. They shouldn't be doing.

And then they've got to a point where they've also got rid of delivery. Like they're no longer the person doing that. then they've probably got a few other things that they can get to like sales, marketing, IT, finance, HR, but normally at the point where they've got delivery outsourced, they've got a team of say five or more and they've got the revenue that can afford it, so typically we're working with seven figure plus clients, then that's the kind of time that they might think about bringing in an operator.

I think there's a mental side of this as well, like they've been the person to run their business for a very long time and now they've [00:07:00] got to get used to letting go. And so, if they've already made the step of letting go of delivery, this might be the next step where they're now like, okay, perhaps I can get an operator in to be one person who's going to be between me and the team and allow me to focus on that zone of genius and perhaps, you know, have time for my passions, relationships and then focus on strategy and getting more deals.

And then that, what that affords them there, they get time, that allows them to get more operational smoothness in their business and perhaps later on allows them to exit their business because if they are still that person that's working within the team and driving everything, it's very hard to sell your business.

I think that's a really great point. Businesses that are run fully under management are far more valuable to a potential. Purchaser, because if you're the key person, you're the one who has to be in the business running things, and if you go to sell, there's going to be a massive discount applied because there's a huge amount of risk, whereas if you've got an operational executive [00:08:00] team, you've got someone who's you don't have to be there day to day running the business, then that puts a massive premium on the business because it de risks things.

But ironically, you know, a business that is attractive to a potential purchaser is a business that's attractive for you to own as well, because That's a business where you can go on holidays for three, four weeks, a month or so or more, and you're not freaking out that things are falling apart.

And, you know, you have to be on your laptop or your phone instead of being present with your family and all of that sort of stuff. So, really a business run under management really well is a business that's attractive. To you as well as someone who wants to buy it if you want to sell it down the track.

And of course, a lot of people say, Hey, I don't ever want to sell. I love what I do, whatever, which is totally fine. But one day you may be in a position where you see a better opportunity, or maybe you have a health issue, or maybe you want to retire or whatever else. And you want to be in the position where you can exit for more money than you've ever seen in your [00:09:00] life rather than just wind it down.

Lloyd: Yeah, and it makes a lot of sense. I mean, a buyer is not looking to buy a job. they're buying an investment. And I had a surprise with one of my early clients. We managed to get them out of, you know, they were doing 60 nowadays, and he was trying to be both a creative and then running his team.

And he was doing quite a few things where he just didn't know. He'd been an entrepreneur all his life, so he thought a good sort of rhythm with his team would be. Have a team meeting every day with the whole company, right? And get all the ideas. And that was really inefficient. However, he had a really successful business.

So having some changes in there, having one person between him and the team meant that he was able to get much more time to focus on his creative side. The thing that surprised me Was that I was expecting him to be sort of the poster guy of saying, Hey, look at me, I've got all this time, I don't do as much anymore.

No, that's actually not what happened. He just spent the [00:10:00] time working on his passions. He was still doing the long days, but he was now doing video creatives, and helping out with launches, cause that's the stuff that gives him energy. And I think, I don't know if he will sell his business anytime soon because now he's just thinking about, Oh okay, I see a retail deal coming up and that stuff gives him energy so he'll focus on that instead.

It's giving you freedom really, yeah.

Allan: That's definitely the positive of freeing up some of your time. I've also seen it go negative where now with all the free time the visionary starts creating chaos in the business. We're like, Oh, we're changing course or we're launching this new product, or we're going to do this, that, or the other.

And you know, as someone who has like five ideas a day, you it is something that you really have to fight every day because often you're on a trajectory, you're doing really well, your main product is selling well, and you know, we've got a mutual friend, James Schramko, and one of the things that I've really learned from him is subtraction rather than addition, you know, so many people are like, let's add another product line, let's [00:11:00] launch in another market, let's do this, let's do that, and that's exciting, and that's fun, but yeah, Often the best success that you have is subtraction is like looking at, Hey, what's the number one selling product that we've got?

Okay. This accounts for 80 percent of our revenue. If we got rid of the other 20%, we could double down on that and we could go, we'd go crazy

rather than, Oh yeah, exactly. Simplifying. Yeah. So that's something that I really a big lesson I learned from James in terms of simplifying your business by subtraction, not addition.

Lloyd: And I can relate to that a lot because when I'm working with these founders, They have all these bazillion ideas and we have to say, okay, well, let's put them in priority order. Okay, one, two, three, four, five, six. Okay, which one of these things is really going to move the needle the most? Like, which one of it?

And when you focus just on the top few and really prioritize it until it's done, because a lot of these visionaries there, they go after shiny objects. I can relate. I mean, I think my attention [00:12:00] span's been getting less over time thanks to social media. But they see the next shiny object and they want to go after that.

We're like, no, let's, look, it's your show. You can choose where we go. We're going to prioritize it and we're going to recommend. We're going to go 1, 2, 3, 4, 5. But let's complete, like, let's work on the thing that's going to move the needle the most. And simplifying is what it boils down to. Like, what is going to give us the bang for buck?

Allan: Yeah. really, Really important topic. I recently read a book and I think I'm going to do a review of it. It's called Essentialism. So he talks a lot about this very, very good book. So the key is really to not. Just keep adding, using your free time to add. that's not to say you can't launch something new.

You can't spin up something new, but do it as an MVP, do it in a way that's deliberate, not creating chaos for your existing business, because you know, that slack message on a Friday night to your team, Hey, we're changing everything or whatever. Like it just derails the team. It everything.

So, [00:13:00] and like I said, I have 100 percent been guilty of that. And. Often it's a temptation, you'll go maybe to an event or you'll talk to someone who's got you inspired on a new strategy or something like that. And you change course. So that's not to say we don't use more and better information to make course corrections, to make additions, all of that sort of thing.

But they need to be done deliberately and carefully and, you know, focus is such a precious thing.

Lloyd: I've seen that, that Friday night message you see. It's, you know, along the lines of Hey, team. I've just been inspired by this. You know, I went to this conference and we're going to now go this way and you're like, you're going to end up with whiplash. Like what? What message does this send to the team?

Because sometimes they're going to feel like they're in the emergency department. And so actually putting in a number two or one person between the founder and the team can actually be a real benefit for them because now they're getting some kind of consistency and rhythm and that number two can be a filter and say, okay, look, We are going to focus on 1, 2, [00:14:00] 3.

We're heading this way. And that means that founder or business owner has still got time to talk with the number 2 and flesh out this MVP and work out where it sits. But, you know, that number 2 can be a real protector for the team and allow them to complete tasks. Mmm.

Allan: We've got four or five team members we're doing a million in revenue or so. You're leading the team and you're doing all of this other stuff that you know, isn't in your genius zone and. what's the best way of going about hiring that number two? Who do I look for?

What do I advertise? Do I look for someone who's already in a number two role in another business is doing something similar? Am I training this person? How am I looking for this person? What are your thoughts?

Lloyd: Firstly, I would say If you've got someone in your team who can do this, like someone who already, you know, like trust, who's got the culture of your business, who feel like eventually can [00:15:00] step up, you might look at one option is actually training that person and bringing in an outsider in to set up all of the rhythms and get them all going.

If you think that person's got the potential and then moving them into that spot.

Allan: What am I looking for in terms of potential? So is it that it's someone who is kind of that integrator mindset or like what specifically am I

Lloyd: So I'm going to be obviously bias and tell you what I'm looking for in my business. I'm looking for a few different things. I'm looking for leadership. Like, is this person who can run a team? Is this person who's going to be able to lead with empathy and coach others? And they're not, the hero.

It's kind of what Jim Collins would describe as the sort of the level five leader. Do they have that empathy and that human nature to listen to others and work with them to resolve? So they need to have leadership skills. The next thing is the organizational aspect. Like, are they an organized person, or is it just loose?

Like, are they someone who, if they say they're going to get [00:16:00] something done, it's going to get done. Are they So that element of being an organized doer who already is someone who buys into systems. You've got to have that level. And then the final piece that I look for is I look for sort of, how they are with process analysis.

So there's going to be an abundance of different areas in the business and challenges that come up from there. It's not their job to solve all of the problems down at the minute eye level, but where they are seeing reds and greens in the business. So where we're saying, okay, what are the numbers coming out of marketing?

What are the numbers coming out of sales? What are these things? Oh, we're seeing a red here, like this is below the trend. Okay, let's go and have a conversation with that person, find out. What they need, explain to me what's going on so that they can understand, right? I have an understanding of the problem, I understand what you need.

Okay, now let's go about addressing that. So I'm looking at leadership, I'm looking at organizational skills, and I'm looking at that ability to be [00:17:00] analytical. But before all of that, if I'm hiring someone into my business, I really like what Jim Collins says about right people, right seats. So, right people.

Is that, do they fit the culture of your business? And I know this stuff about values sounds like fluffy stuff And I must admit for the years I was in corporate where people would talk about the values of the company I'd think, really? Is everyone buying into this? But that does decide the kind of people that you want in your team So, if you've already got someone in your team who when you work with them you think Yeah, this is the right person, they sit in our values There are batteries included kind of person, if that's one of your values.

They are someone who completes things. They are someone who's accountable. Whatever your values are, that is a great place to start. So for me, one of my first lenses is empathy.

Allan: Mm

Lloyd: for some [00:18:00] businesses. So I'll tell you who we're not. Just to give a point of difference. I particularly see on, say, the east coast of the US, perhaps I'm being unfair, this kind of structural dictator style of management.

I still believe you can get the same results by understanding what someone's trying to do, helping them get there, and still giving them goals that are being measurable, without coming to this sort of dictator style of management. So, I've gone down a bit of a rabbit hole here, but the point I would start with is, if you were looking at hiring, I would start, look first within your team, and then, okay, if I don't have someone within the team, I'd work my way out to the network.

Like, who do you know? Or who can be endorsed? Because that is going to give you a good clue of, is this the kind of person that I can work with? Am I going to trust this? Does someone else say, look, this person's, you know, good, they're going to be a good fit, they're going to get on without my team? Skills are [00:19:00] important, but it's the first lens of, you can get some real hiccups if you go completely out there, you might find there are skills match, you can interview them all the skills and make sure that they're organized and all of these things and answer all the questions, but unless you really know that person it's a risk.

Allan: Yeah. I wanna expand on a couple of things that you've said there. So, I've had tremendous success in my team on hiring based on attitude, not on skills, because skills can be taught, like we can teach someone how to use, you know, an editing tool or how to write in a particular format or whatever, but we can't teach someone. In my experience, from going from an B player to an A player, to showing up on time, to doing the work, to doing the inputs, to, you know, being conscientious and making sure that things look right. So, that's something I've never been able to train, never been able to inspire someone to do. So. I've had a lot of success hiring people who were skills wise underqualified, but attitude wise were really top [00:20:00] notch and they've progressed throughout the organization.

I mean, even, you know, my, my CEO now, Anna, she just started as a coach in our team. She progressed and you know, she's a killer, right? and I would say that about pretty much everyone in my team. In fact, I would say. Yeah. It would be concerning if you have no one in your team that you think that you can elevate.

Right. If they're all, you know, that's not to say everyone has to become a manager or in a management position. Some people just love the role that they're in and do really well at it. But if there's no one that you feel. Yeah. I think that's a bit of a red flag and you, there should be people where you can absolutely trust them to deliver what they say they're going to do where you don't have to micromanage them.

You know, I know. was popular for a time and maybe still is where, you know, your screen recording their desktop to make sure that they're working and they're clocking in and clocking out. And I mean, I couldn't think of anything worse. First of all, I've got to review all of this stuff, but also I imagine how [00:21:00] it would feel for me if someone's watching my screen eight hours a day or whatever.

I think that's just horrible, right? Let's

say.

Lloyd: so glad you brought that up because I get that is one of the questions I've been asked about. Should I use this particular tool that can do screen recording? And I don't manage that way. I'm interested again are they getting the outputs? And if they're not, I want to understand why and seek to explore what we can do to resolve that.

I remember working with one client who had been using this tool to do screen recording. And he found that this person had I think he had Netflix running in the background, right? And I said, all right. He's got Netflix running that's, disappointing. Tell me about the work this person's delivering.

Like, is it good? Is it on time? Is it? Yeah, it was. I'm like, pfft. Why are we even, why are we even looking there? People are going to do their internet banking and I don't know if he needed a break. You know, we are human. I would personally hate to have screen recording going on, my screen.

There was another thing you mentioned there that resonated with me which was Yeah, [00:22:00] you're hiring for characteristics and then see if they can move into different seats. And I hired a VA years ago and he started off working on things like you know, I'd have him as a support for my team where he could help with dashboards and things in various task management tools.

and then one day I was just asking about what his interests are. And I think actually that's A very important thing to do, because sometimes you get some surprises from people, like, you get a real win out of your team, if you can make it such that when the project succeeds, so do those team members, and when they move into that area that really interests them, you're, it makes sense for business too, you'll get increased productivity.

And so for this team member, I was asking about his interests, and he said, oh, I really like, doing stuff on Instagram, doing little videos and things like that. And now when I was doing my early Instagram posts and videos, and by the way, they're still far from perfect. But they were, I just got carried away with all the special [00:23:00] effects.

I was just, all sorts of, you know, lasers coming out my eyes and everything. I was just, I just went, I got some interesting questions from people. And he just said, Oh, this stuff's really good. I'm into this. And I said, how do you want to take it? Do you want to have a go at this? And he is brilliant.

Now, this has come at the right time in my business now because this year I'm going to be putting a VSL, a video sales letter out there. And there needs to be some editing. I've taught him how to do some basic web page editing so we can start split testing landing pages and things. And so this is a whole new area that when I hired him, I never thought he would end up in.

But the characteristics of this person are, I mean, I trust this guy to run my payroll. It's the trustworthiness. I know this guy, he never lies to me. If there's a, if there's a power outage out and he's going to be out for two hours, I know that he's going to make the time up if he needs to.

And, you know, this is someone that's going to be in my business for the long term. And it's worked for both of us because I've got him to work more into his areas of interest.

Allan: Yeah. And on [00:24:00] the values piece, like I've always rolled my eyes on, you know, cause like you do these values workshops and of course, you know, everyone's values is hard work and, you know, competence and, you know, customer focus and all of this. And, you know, mostly it's just kind of cliches and things like that.

I mean, these things are really baseline things, but when it comes to company culture, I think it's. It's really what you do. What's the vibe of the place is and all of that. And you know, in some places, it's like, look, we're just going to work 16 hours a day and we're going to smash things out. We're going to, you know, exit for a billion dollars or whatever.

And that's totally fine. If you're buying into that culture, that's what you want. You want to optimize for that result or awesome. Versus, you know, Hey, for example, in our business I mean, My values are as a business owner, as someone, yes, I absolutely want high performance. I absolutely want to knock it out of the park.

But more than anything, I want to have an amazing lifestyle. So I want, to be able to travel. I [00:25:00] want to be able to have a lot of time freedom. I want to be able to work on the stuff I want to do. And if there's a kind of crossroads where I've got to choose between that and making more money or maximizing profit or whatever.

I'm always going to choose the freedom, the fun, the flexibility option and I do that. That definitely drives some of our decision making and so if that's what I want for myself, that's something That I want for my team as well. So a lot of the decisions we make is around that. So we let team be kind of flexible with what hours they work, where they work from.

So we don't have an office where they all come to. We don't do any of that sort of screen recording or time logging or whatever. Now that doesn't mean we don't We absolutely expect people to perform. We have set KPIs, set inputs, set outputs and things like that, but really our values are around fun, freedom, flexibility, a cool vibe, somewhere where we just love to work, not where we hate working, right?

That's super important to me and my team. And [00:26:00] that's kind of

sets the

culture of the business. So, so yeah, it's very different from like a values workshop where you kind of roll your eyes. You're like yeah, sure. Hard work and,

Lloyd: Oh.

Allan: customer focus, all of that sort of stuff.

Lloyd: And I've seen this done so badly before as well. I I went into one business where they had 10 values. And I'm like, really? Like, can you? It's a family. I'm like, seriously. Can you? Can you tell me what your ten values are? Because I can't remember ten things. Do your team know what they are? Does it resonate?

Are these real? Like, I mean, I've got four. And four is memorable and they mean something to me. And, you know, one of them is heart and humour, right? Sounds a bit fluffy. But it's our style, right? We're not that East Coast American sorry, East Coast Americans. But we're not that dictator style.

We're going to start our meetings with rapport building, and that's it. That's an important part of how we do business with people because who knows you're just about to bring someone into perhaps a difficult conversation and you find out a dog's just died or something like that. So it's important. We want to, we start with rapport [00:27:00] empathy is a part of our business and another one around ownership is we are artists.

So and a part of that is I'm not expecting to tell you everything about how you're doing it. I've given you a goal. This is what we're aiming for. But it's not work. I'm not going to say, do this. I want you to treat it like an art, like this is your passion. And so when I, took this guy who's a VA in our business and said, for, go for this video thing, have some fun with it.

He's taking it to another level because he's an artist. and then the, the sort of harder hitting side of the values piece, where I say it's not fluffy is, you can do a simple exercise. And this is again, a Jim Collins good to great idea. where you can list out the people in your business and list out your values, if you've got, you know, however many of them and you can just tick off and say like, are these the people who really adhere to these values that matter to me?

And if you can't tick a good amount of them, you've got to really reflect on whether this is someone that you, who's going to be in your business for the long term. So it's a good basis for performance managing and [00:28:00] hiring and when you're giving people feedback, constantly saying, look, This is what we're aiming for.

This is a great example where, hey, someone has succeeded in this value. Like, we are artists. This is an amazing piece of work. I want to celebrate that openly with the company. Look at this. But when this is something that's clearly out of alignment with how we do business, that's where I have that private conversation with them and say, hey, this is not really how we're doing business.

And so it's also the basis of performance management and hiring. And that's where I use it.

Allan: I've often said there's no such thing as business problems, there's just personal problems that manifest themselves in your business and I think running a business is one of the best personal development tools you can ever build because it will reflect your values, it will reflect your personality, you know, if you're sloppy, if you're late, if you're, you know, a micromanager or whatever, that's All stuff that's going to reflect themselves in your business.

And it's going to put a cap on your growth. And [00:29:00] often that control aspect is one of the hardest things because sometimes you'll see something and it's like, it's not quite the way I would have done it. You know, it's like, you know, and if you're micromanaging every person, every interaction, all of that's going to become a massive block.

I say my kind of bar is look, if it's 80 percent as good as I would have done it. Let's let it go, right? If it's terrible, if it's going to embarrass our company or whatever, absolutely I'll, block it or stop it or whatever. But if it's 80 percent as good, that's fine. Like, cause that gives me leverage that allows me to continue doing what I need to do in my genius zone and the team can continue to execute.

And of course, yes, let's course correct. Let's make it 85 percent next time. Let's make it 90. Let's get as close to a hundred percent as possible. But Don't let the little kind of tweaks that you think you know, not good

Lloyd: my new tie. I know I would agree with that. And I think actually, when you asked me earlier about what's one of some of the challenges of putting someone in like this is [00:30:00] well, a lot of founders do struggle to let go of the reins. And generally a couple of reasons for that. And one is because they just don't feel like things will run smoothly if they let go.

And that might be true because perhaps they haven't got clear accountability in place so that the team might not know Who, am I actually responsible for this, or is this a if there's two people who work on this particular process, who's the one person that's accountable for it? Like, if someone goes on holidays, it's both going to continue, so putting systems in place to make sure that happens if that's lacking, then the founder's going to get stuck, sucked back in.

And I think it really is, as you say it's very much about, systemization is part of what we do. But it's done through people. We're not coming in and say here's all your system done. It's actually working with a team so it sticks. And that stuff's the warm, fluffy stuff about building relationships with people.

Finding out if they can do it. Finding out, is this the right person to be accountable for it? And if they are accountable for it, [00:31:00] and it's working, then you can step back. And the other thing is what you were talking about there, about, you know, not jumping in and firefighting every single thing It comes down to coaching and that's not easy to do.

It's very easy. Someone's got a problem and they come to you and they say, Hey, Allan, I've got this problem. Sometimes you know the solution and you're like, Hey, here's the solution. Go do this. It's very tempting, but actually what you should be doing is and I think I'm going to steal this one from Dan Martel.

It was that what he calls the 131.

Is it still in your business? If you're coming to me with a problem, give me, it doesn't have to be three, but come to me with your three options and one of them might be do nothing. And then the final piece is, so one problem, three options, the one thing that you would do.

And they now know that they now have to be in it. And so that's basically a method of coaching them to start owning these things and have a go at it. And as you find that they can do that well, you can zoom further [00:32:00] and further out. And this is not an easy skill for someone to do and so that's perhaps where someone like a 2IC who is very familiar with coaching, you can give that problem to them, right?

Anything that's coming up, bubbling up, work with a team and start, you know, coaching them through. And so the ultimate goal of of a thing a manager is or a leader of a team is to make themselves redundant so as much as possible is autonomous and is owned by the team.

Allan: going from number one to zero. I love that. I'll throw in another Dan Martell. I caught up with Dan last year and got to spend some time, but one of the things I like that he talks about is definition of done, D O D, right? So a lot of times You ask someone to do something and your definition of what it looks like done is very different to what their definition is and often there's that mismatch.

So he talks about definition of done like showing them this is what this is the output that I'm expecting. This is what [00:33:00] good looks like. And so rather than giving them all of the inputs, like, you know. I want my floors clean, and this is how I want them to look rather than showing them how to use the mop and which mop to buy and which bucket to use and all of that sort of thing.

So what's the definition of done? Here's what I want my Instagram reel to look like, or here's how I want my YouTube video edited, or here's how I want our SOPs documented and things like that. So, definition of done, I think is a really important

Lloyd: Yeah very, very powerful when delegating something to someone. And I think he, he took that from Agile. And I like, you know, as an ex corporate myself, I liked a lot of Agile concepts, but quite often they put too much ceremony around it. But that was one I really liked. And so when I used that, I I filter it to say, What things will be true when this is done?

And that's my question. And so, sometimes if you're in your task management tool that you use, and JIRA or ClickUp or whatever you can have a little [00:34:00] template question in there so people see. What things will be true when this is done? And you, when you assign out that task, can say, Oh, it's going to look like this, it's going to be like that.

Because, I used to see that with software developers when I was an engineering manager. Done for them might have been, it's developed. Oh, great, you've developed it, but Did you, is it tested? Is it live? I mean, is it done that it's actually live and people are using it and clicking on it? Or, you know, in your online business, is it live?

The landing page is actually live and then the ads

are hooked up to it. That's done, yeah.

Allan: my experience in business and getting things done is when it's at 90%, you're really at 50%, you know, so it takes about 50 percent of the time and effort to get to 90 percent and that last 10 percent that takes another 50 percent of effort. So, I certainly felt that when I was launching my previous book, Lean Marketing, like when I was done writing.

I was maybe 50 percent done. Then there's the editing, then there's the cover, then there's like revisions, then there's [00:35:00] all of that. So to, to take it from done manuscript to launched and, you know, it's another amount of effort that that's equal to the finishing of the writing. So

Lloyd: There's another thing you just said there earlier, which I can relate to there, which is Perfectionism can also be a very bad thing. And so, if you know, as what you said, is it 80 percent good enough, that last 20 percent often takes the most time. So if you know it's good enough to get out there and get feedback, and iterate and say, hey, this is version I mean, I'm going through this process now.

I've got a video sales letter that's going out. I know it's not good. But, you know, there's plenty of things. This is my business. But what I want is version 0. 1 to be alive. So I can go to people and say, Right, tell me what's wrong with that. Does this hit? Does this resonate? Right, let's get another version out there and compare and start.

So just getting 80 percent there is much more bang for buck.[00:36:00]

Allan: Yeah. So, let's get a little bit tactical. So talk to me about some of the real tactical stuff of working with two IC or second in charge of your business in terms of like. What's the meeting cadence with the team and then with the founder or the CEO look like what are you doing in your Slack channels?

I know you have some thoughts about working asynchronously versus not. I'd love to hear some of the more tactical things. So we talked a little bit about hiring, about some of the values piece, but getting really tactical. What are your

Lloyd: Mm. So, generally the way we work in our business is that we will start with an operational health assessment. It's basically an audit, but audit sends a negative connotation to people quite often. And then there we're going to look at, well, we're looking at a few things there. okay, we're looking at vision values and accountability, because that's going to be the basis of performance management.

Do they have a way to manage team in there? Are we heading in the direction, do the team know what direction they're [00:37:00] heading in? Do they think this is a service that's white glove, really high touch? Or is this more about producing volume? So we're doing an audit on there. We're looking at what you just mentioned there.

Rhythms, dashboards and feedback loops. So what are the rhythms that run the business? And are they effective? And we'll come to that in a minute. Dashboards, like what are we measuring? Because if you measure too much It's just a waste of time, like you might just want to measure a few things, give people a few key measurables that really matter, like one person, one measurable, that matters.

and feedback loops, like are we just doing things, like are we running events or campaigns, and then that's just that's the end of it, or are we learning from it? And then another thing that we also do is revenue operations, which you can go down a long rabbit hole of that, but that's about Looking at how sales and marketing and account managers work along with the CRM.

So we do an operational assessment. And we work with the team and we interview them and look at the systems they're using. And that completes typically in about a month. And we go back to the [00:38:00] founder and we say, Look, these are all the things that we found. And by the way, we catch up with them weekly while we're doing this assessment.

And we say, look, this is what we're seeing so far. There's a whole surface area of things that we can cover. Do you want, are you interested just going over here or going over there a bit more? So we, at the end, we come to them with a prioritised list by effort and impact, and say, these are the opportunities in your business and this is how we'd fix them.

So that's how we typically start. And that can just be a one and done thing. Some businesses just want an external perspective of their business about what changes and what, make things better in their operation. But more often than not, what happens is, They will say, yeah, let's go for it.

We'll start now on a retainer. And so that's where we will take that big list of prioritised things. That will be the prioritised list. 5. And that will be the starting point. Now into the tactical of it. Like, how do we do it? So because we're a fractional business, we can dial up, dial down.

So in our sort of most basic [00:39:00] offering, which is our sort of Coca Cola standard offer, We'll just have a few meetings a week that are live, like this, you know, on Zoom or whatever tool. And one of those will be a connect with the founder or business owner. So we're that to IC, the person between them and the team.

And we're going to talk with that person and say, a part of that activity is going to be, Hey, these are all the priorities, 4, 5. And it's that priority list started with what we came up with from the operational health assessment. But that founder might say, look, there's this other thing, number 7, you don't know about.

Or there's this other thing, or I want to change the order, these things are more important to me. So, cool. So we have one meeting with the founder a week. And we'll go through that list, and we'll talk about issues as well. So we can say, alright, how do we want to solve this? And then this is what that operator is going to be responsible for.

Going and working with the team, and making it happen, and just going through this list. So that's sort of one rhythm that we're going to run. The second rhythm we would do is have [00:40:00] a team meeting typically with the heads of various areas. Sales, marketing, IT, finance, HR. Whatever those key areas or key teams are.

You know, I've worked in places where it's the head of the dev team or head of creative. That's more likely to be that kind of way in say an e commerce team. And what we're looking for there is a couple of things. So we're looking for. We talked about how we're going to be measuring aspects of the business.

So I want to see the numbers every week. I want to say, you know, what, okay, for example, what are the numbers coming out of marketing? It might be how many booked calls like have we got as a result of, you know, how many qualified leads have turned into booked calls might be an example.

Allan: So often though, there, there'd be a piece of work prior to that, because a lot of people will say, I don't know, like I don't measure the numbers. I don't have the dashboard, I don't have the tools or the CRM or whatever it is. Right? So a lot of times the answer is, I don't know.[00:41:00]

Lloyd: Yes. Thank you very much for raising that. Back up the truck. So out of that operational health assessment, a lot of things will be highlighted like, you're not measuring, you know, and the start to managing an improvement for something is to measure it. So, quite often we see people are measuring too much and too many wasteful things, and sometimes they're measuring the wrong thing.

So part of that work will be to put those things in place. But when we're humming along and we're doing things, eventually that meeting will look like we're measuring things. And it doesn't need to be a fancy dashboard. It doesn't have to be you know, a fancy tool. It quite often, to be honest, is just a spreadsheet with the weeks across the top of where we are and who they are.

You know, who are the main people accountable for different areas. And is it trending up? Is it trending down? Is it flat? Is it red? Is it green? And then the second piece of that will be to understand, okay, what do we need to do to make that red or green? And that will be, we don't want to take [00:42:00] everybody in the business and have a big chat fest about it.

What we need to do is work out, what's the next thing that needs to happen? So, who needs to be pulled aside to say, right, how do we make that red or green? So that's another sort of key rhythm we run. The, we've got the founders meeting, we've now got that. Team meeting with the heads of and the leads to look at the reds and greens and work out what needs to be done to improve those things.

And the other kind of rhythms that we typically run are feedback loops. You know, what campaigns have run or what, you know, the campaign went live, great, how did it go? Was it planned well? What was the success? Are we going to do more and more of that? Super. Or was there something that didn't go quite well?

Right, well. Do we have a template for what this event or campaign looks like? Because we're probably doing one Black Friday, Cyber Monday and Halloween and Christmas and Easter and all of these things. Do we have a template for an event and all of the things that need to happen? Can we learn something and update that?

So there'll be [00:43:00] feedback loops that need to be tagged on all the way through the business about making sure that we're learning and improving our processes. And other things would be huddles. So, this should just be a very quick. Catch up, and quite often we can just do this over Slack, or whatever Teams channel you use, we don't really mind, which, about a lot of the tools that people use, as long as they have the outputs that we need.

And that's really about making sure that people aren't blocked things are moving along, just keeping communication flowing, and not having a, huge you know, not being blocked, visibility. So, those are the kind of the main rhythms, and then one on ones checking with people, so founders, team meetings, one on ones, huddles, feedback loops, like those are the sort of five key rhythms to have in a business to make it run smoothly.

And those are the things that happen every week. And then a lot of other stuff can just happen asynchronously on Slack. Just keep the team moving, [00:44:00] or whatever your chat channel is. However, I will say this, as someone who's a massive advocate of flexible, different time zones, working together and doing things asynchronously.

Sometimes, the downside of running something like this is that when you're doing things asynchronously, is that how things are communicated over text quite often leads to misinterpretations. And so that's why it's important to bring people together periodically and have efficiently run meetings. And yeah, quite often I've seen cases where someone sends something in text to someone else, and someone reads it and fires back, and then we have escalation.

And so we put rules in place about how to handle that. Like, if you read something that you've read and you think, well, what, I'm going to fire back or I'm going to escalate, we say, just pick up the phone and give them a call.

Allan: yeah. And then there's direct messages which needed to involve someone. And so they're out of the loop and things like that. So, a couple of things I wanted [00:45:00] to kind of highlight there. So, one is really, it sounds like there's a real need for systems to be in place. Right. So, because. You know, my definition of business systems is essentially a set of checklists.

So this is how we do something here. So step one, we do this step two, and then some of those checklists are operated by humans. Some are automated, done automated and done by technology. And now, of course, with AI tools, we've got more and more options to do that. But. It's essential. You know, a lot of times I'll speak to a business owner and they're like, how do I automate this?

Or how do I get AI to do this? And I'm like, you don't even know the steps. So how would you tell a machine how to do that? You know, if we were starting a shoe factory, you know, and we were telling the engineer, Hey, we want to automate the production of these shoes. We would have to tell the engineer.

All right. So step one, what we will want to do is we want to cut the leather a certain way, right? Then we want to get the sole and we want to glue it. Okay. Okay. In this [00:46:00] particular way or whatever. So we would need to know how to do it before we automate it. And that, you know, the exact same thing is true, whether you're manufacturing shoes, whether you're, you know, producing YouTube videos, whether you're creating content online, whether you're, you know, delivering coaching, whatever, we want to make sure we have those standard operating procedures that tell us, how do we do this?

And then. We can figure out, okay, well, these processes can be run by machine and these processes need to be run by man, you know, or man or woman. Right.

So, that's really a critical component, isn't it?

Lloyd: I agree. And I mean, and that's a part of our health assessment as well, is like systems they have in place today. And a lot of it boils down to that accountability piece that I was talking about earlier. So a simple thing that I see missing very often is a business might have SOPs.

And sometimes they're going, Oh, we really need SOPs. We don't have them. Are we going to make it happen? And they've got this view in their head that it needs to be that clean down to the most micro detail. [00:47:00] And the reality is, it's very hard to hand an SOP to another person and who's going to do it perfectly.

It's a reference point where two people can refer to that, it gets updated, and now they can execute that. The thing that I find that's missing quite often is that accountable owner. So, a simple thing that I'd say, whatever tool they're using, whether it's a spreadsheet, to have an index of a list of their SOPs.

And they might have a number of people responsible for doing it, but who's accountable for making sure that happens? And who owns it? Who's responsible for making sure that SOP is maintained and executed? And, as I was saying earlier, what if this person's going on holiday, is someone else going to pick it up?

And that accountability piece is important. At the beginning of as a part of our um, operational health assessment, we'd be looking at do they have core SOPs for their flow, and I'll take this idea from our mutual contact from David Jennings from Systemology, one of the things that we use and we're, [00:48:00] by the way tall agnostic, and we cherry pick from lots of different frameworks, but one of the things they do is they have What they call the critical client flow.

We use that. And we map out those processes from how does the money come in the door all the way through to how it's delivered and to how that money ends up in our bank account. That's like the core of it. And then that gives you great place to look and go, Alright, do we have processes for all of these things?

Because that's the important stuff. And then, you know, is the accountability clear for all of those things? So it's very important to have that.

Allan: I totally agree. Dave's a good friend. We catch up pretty often and he, he lives just over the

street over from, where I am. Um, yeah, and he has got a very good systems mind and we highly recommend the systemology process. One last thing I want to ask you, so obviously your.

You're in the business of providing people fractional COO services. And so, you know, I want to understand because like, it feels like. And [00:49:00] maybe this is an objection you get often it feels like some, you know, someone external would have a hard time kind of, being in the business and knowing, understanding the business, running a team and all of that sort of thing talk to that a little bit versus having like a fractional COO versus someone who's dedicated in the team or even just in the team, but part time.

Lloyd: Mm. So,

Where we're normally involved is they've not yet made that transition into having an operator in their team. Or there's someone in the team who's just, they're either, they might be the right fit for the business but there's some gaps, like they don't know how to fully run all the rhythms.

So they either don't have that role yet or they've got some capability in that team but it needs some support. And so where we fit in well is we can come in, help uplift and it ends with either someone in the team is being uplifted to replace us or they're great we've now got the scale to hire a full time operator and so [00:50:00] then we even help second round interviews for that normally they want to have the first round.

So that's the kind of world we would fit in. I think where fractional works versus, say, full time is you might not have the budget for a full time. if, that kind of role, they're going to want stake and equity in your business. So where this can work is you're coming in, you're working with a team, you're trying to enable and uplift the team, you're not there to kind of work against them.

You're trying to say, I really want more ownership of this is going to be your area, what can I do to help support you? And the ultimate goal for us is, ironically, to make ourselves redundant. And as a business that's largely run on referrals, that's our ultimate goal, is to leave with a couple of referrals.

So, if you're at the point where you think, right, well, I could go straight to hiring a full time COO, or Director of Operations, or Chief of Staff, great. I think a lot of founders struggle with that because they don't yet know how they're going to hand something off. Like, they're a bit holding onto the reins.

So, to just go from Fully [00:51:00] holding, like fully holding onto the reigns to just finally passing everything to someone is a risk. Whereas if they pull in someone on a fractional basis who can start uplifting the team when they think, oh, okay good. I've managed to get a lot of this stuff off my plate. And now I think I, someone in my team or a full-time operator can come in, we can just transition no problem.

And for us. Some of the reasons why some of our engagements have gone on for a very long time is because we moved into a different role. Like someone else has come in to be that business has grown. Someone's come in, but they've seen, still seen value in us running a particular area of the business for a time being.

And that's how we ended up actually moving into another area or having another feather in our cap, which is revenue ops, which is that piece about. Trying to look for opportunities that maximize what you've already got in your CRM and how you can work with sales marketing and account management to maximize what you've already got.

[00:52:00] So, that's just another piece we think, well, how can we continually add value to a client?

Allan: nice. I like that. That's a very similar business model to our business, except we do that, that in marketing, we, in our accelerator program, where we'll come in for a season, we'll help you uplift your marketing processes, your marketing team, help you hire a marketing coordinator or a head of marketing, whatever, help.

Put all those processes in place. So I like that model because, you know, you're not necessarily in working with a client forever, although some clients do, like you say, have value in working with you for many years because they've had a lot of growth or maybe you're helping them in other challenges in their business and things like that.

So I like that. that's good. Lloyd, it's been a real pleasure speaking with you. Is there anything I, haven't asked you that I should have asked you?

Lloyd: Ooh. I think the number one challenge I would speak to that we see in business is clarity. So, the reason the founder is not letting go is because they feel some discomfort that [00:53:00] it's not all going to happen. And so a lot of this boils down to clarity, which largely boils down to accountability. So if everyone knows exactly what they own and there is some tangible measure to see whether it's working.

The founder can start stepping away and go, okay, I can see this is working. but there's a great quote along the lines of, you know, if two people are accountable for something, no one is. So you've got to understand who owns what. And so when that founder starts getting clarity, they can be comfortable.

When the team start getting clarity, they can be comfortable. And so that's something I see time and time again, it's not clear. where we're heading from the perspective, the team don't know what's, what the vision is. They're not sure where they're going. They're not clear what they're accountable for.

They're not clear who owns the processes. So coming in, giving that clarity can make a huge amount of difference. And a lot of it boils down to accountability.

Allan: That's awesome. Well, great place to finish up. Thank you so much, Lloyd. Appreciate your time. Appreciate your me. And thanks so much for coming on.

Lloyd: Great to [00:54:00] be here. Thanks again, Allan.

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