Clockwork: Design Your Business to Run Itself Read online

  TESTIMONIALS FROM EARLY READERS AND TESTERS OF CLOCKWORK

  “Clockwork had a radical impact on my personal approach to business. One of our companies acquired a record-breaking 22,000 customers in just five days, and our other one just had its three most profitable months in eight years of business, with no sign of slowing down. Oh, and both happened during an extended sabbatical largely made possible by internalizing and working toward the designing phase (the fourth and highest D).”

  —RYAN LANGFORD,

  CEO, Ultimate Bundles

  “Implementing the Clockwork principles into our business this past year has been a total game-changer. As the visionary and chief content creator, I’ve been freer than ever before to do the things that only I can do, while I trust my team to take care of the rest. We’ve eliminated bottlenecks and learned how to use tracking and measuring to make much smarter decisions. Even better—my team is actually happier as a result!”

  —RUTH SOUKUP,

  author and CEO and founder, Living Well Spending Less Inc.

  “Since implementing the framework and principles taught in Clockwork, my business has released me. I am no longer being run by my business; rather I am running the business. Thanks to Clockwork, we are about to set off on a four-week trip as we travel across Canada work free for the summer—a dream come true to be able to fully step away from the business and the business still fully operational.”

  —ASHLEY BROWN,

  owner and creative director, She Implements and Nuvitzo Dance Studio

  “I was constantly spinning my wheels coming up with more ways to convert sales and hit our quarterly goals. Thanks to Clockwork’s ACDC bottleneck method, I realized I was converting people just fine, but what I did have was a prospect problem! Using Clockwork principles, I created a system to track how many people were coming through my doors and where they were coming from, which empowered me to make the right decisions on what to focus on each week. As soon as I started focusing on bringing more people into our business, we nearly tripled the number of prospects!”

  —CARLEE MARHEFKA,

  CEO, Eat The 80

  “As a business owner, I often overcomplicate things, so the techniques in Clockwork helped me clearly identify where I was getting in my own way and what aspects of my business I needed to outsource to grow (and still get to sleep at night). Doing this alone has made a massive difference in what can be accomplished with the same or even less time working on my business.”

  —TARA HUNKIN ARYANTO,

  -CEO, My Child Will Thrive

  ALSO BY MIKE MICHALOWICZ

  The Toilet Paper Entrepreneur

  The Pumpkin Plan

  Surge

  Profit First

  Portfolio/Penguin

  An imprint of Penguin Random House LLC

  375 Hudson Street

  New York, New York 10014

  Copyright © 2018 by Mike Michalowicz

  Penguin supports copyright. Copyright fuels creativity, encourages diverse voices, promotes free speech, and creates a vibrant culture. Thank you for buying an authorized edition of this book and for complying with copyright laws by not reproducing, scanning, or distributing any part of it in any form without permission. You are supporting writers and allowing Penguin to continue to publish books for every reader.

  Library of Congress Cataloging-in-Publication Data

  Names: Michalowicz, Mike, author.

  Title: Clockwork: design your business to run itself / Mike Michalowicz.

  Description: New York City : Portfolio, 2018.

  Identifiers: LCCN 2018015553 (print) | LCCN 2018021396 (ebook) | ISBN 9780525534020 (ebook) | ISBN 9780525534013 (hardback)

  Subjects: LCSH: Small business. | Time management. | BISAC: BUSINESS & ECONOMICS / Entrepreneurship. | BUSINESS & ECONOMICS / Small Business. | BUSINESS & ECONOMICS / Time Management.

  Classification: LCC HD2341 (ebook) | LCC HD2341 .M524 2018 (print) | DDC 658.02/2--dc23

  LC record available at https://lccn.loc.gov/2018015553

  While the author has made every effort to provide accurate telephone numbers, Internet addresses, and other contact information at the time of publication, neither the publisher nor the author assumes any responsibility for errors, or for changes that occur after publication. Further, the publisher does not have any control over and does not assume any responsibility for author or third-party websites or their content.

  Version_1

  For Jake Michalowicz. Wuz up, my brah?

  CONTENTS

  Praise

  Also by Mike Michalowicz

  Title Page

  Copyright

  Dedication

  INTRODUCTION

  CHAPTER ONE

  WHY YOUR BUSINESS IS (STILL) STUCK

  CHAPTER TWO

  STEP ONE: ANALYZE YOUR COMPANY’S TIME

  CHAPTER THREE

  STEP TWO: DECLARE YOUR COMPANY’S QUEEN BEE ROLE

  CHAPTER FOUR

  STEP THREE: PROTECT AND SERVE THE QBR

  CHAPTER FIVE

  STEP FOUR: CAPTURE SYSTEMS

  CHAPTER SIX

  STEP FIVE: BALANCE THE TEAM

  CHAPTER SEVEN

  STEP SIX: KNOW WHO YOU’RE SERVING

  CHAPTER EIGHT

  STEP SEVEN: KEEP AN EYE ON YOUR BUSINESS

  CHAPTER NINE

  PUSHBACK (AND WHAT TO DO ABOUT IT)

  CHAPTER TEN

  THE FOUR-WEEK VACATION

  CLOSING

  Acknowledgments

  Glossary of Key Terms

  Author’s Note

  Index

  About the Author

  INTRODUCTION

  “It’s two a.m. and I am writing you out of desperation.”

  That is the opening line from an email I received from Celeste,* an entrepreneur who reached out to me for help. Over the last eight years, I’ve received countless emails from readers and from people who have heard my message about eradicating entrepreneurial poverty in my books, my speeches, an article, or on a video or podcast. I respond to all of them and save quite a few, and this is the one that lit a fire under me to finish this book.

  The email continued: “I own a preschool. We make no money. I haven’t taken a salary since we started. I’m racking up debt. And tonight, I am broken. Not just financially, but in my soul. I am convinced an immediate termination of my life would be the fastest resolution to my predicament.”

  Reading that email, I felt as if my heart dropped to my stomach. I was concerned—no, terrified—for Celeste’s life. At the same time, I recognized her vulnerability.

  “Please understand, I am not sending you a suicide note,” Celeste went on, “and I am not at risk for such stupidity at the moment. That decision would just leave the burden to my family. But if I was single, I would be gone. You see, I have double pneumonia right now. I can’t afford someone to clean our preschool, and for the last four hours, I have been scrubbing the floors and cleaning the walls. I am exhausted. I am crying, and stop only because I am too exhausted to cry. I am starving for sleep. I am so ill, yet I can’t sleep because my worry keeps me up. The only thing I have left to give my business is my time and that is now depleted, too.”

  My heart broke for Celeste. I’d been in a similar state of mind a few times in my life as an entrepreneur, and I knew countless others who had been lower than low, desperate for a solution. The last lines of the email will stay with me forever:

  “What has become of my dream? I am tr
apped. I am exhausted. I can’t work more than I already do. Or maybe I can. Maybe my work is the slow suicide I am thinking of.”

  What has become of my dream? Does that question ring true for you? It did for me when I read the email. We work, and work, and work, and work, and before we know it, the business idea we once proudly shared with our friends, the plan we outlined on a whiteboard, the vision we shared with our first employees, all seems like a dim memory of an unobtainable goal.

  Normally, I would ask permission to share an email from a reader, but I’m not sure how to reach Celeste, and I’m hoping that maybe she will read this and get in touch. I responded to her email multiple times, but I never heard back, and I didn’t have any luck tracking her down. I still think of her today, and share her story as a cautionary tale.

  Celeste, if you’re reading this, please email me again. I will help you. If you’d rather not contact me, then please know this: It’s not you that is holding your business back. It’s surely your systems—and those systems can be fixed.

  Perhaps you can relate to Celeste; perhaps (I hope) you’re in a less dire situation, managing to keep up the grind week after week and keep the wheels of your business turning. Whatever the case, chances are you don’t ever feel like you can ease up, or spend less time and effort on your business. Why is that?

  Most entrepreneurs I know do everything. Even when we bring on help, we spend just as much time, if not more, telling the staff how to do all the things that we are supposed to no longer worry about. We put out fires. We stay up late. We put out more fires. We work weekends and holidays, flake on commitments to family, and bail on nights out with friends. We put out even more fires. We push on, we push harder, we don’t get enough sleep.

  But here’s the irony: Even when things are going well with our business, we are still exhausted. We have to work even harder when things are good, because “who knows how long this will last?” And the growth opportunities we know we should grab by the horns, the visionary work that is crucial to explosive growth, the stuff we love to do, is set aside day after day until that notepad with all of our ideas is lost under a sea of papers and to-do lists, never to be found again.

  We’re blowing it. We’re all blowing it.

  “Work harder” is the mantra of both the growing and the collapsing business. Work harder is the mantra of every entrepreneur, every business owner, every A-player employee, and every person just struggling to keep up. Our perverted pride about working longer, faster, and harder than everyone else in our industry has taken over. Instead of running one marathon, we are trying to sprint ten. Unless something changes, those of us who buy into this way of life are headed for a breakdown. And maybe double pneumonia to boot.

  Maybe you can relate. If you can, I want you to know you are not the only one who is going through this. You are not the only entrepreneur who feels they must work harder, who is exhausted and wondering how long they can sustain this level of work. You’re not the only business owner who wonders why all your improvements haven’t improved your bottom line, or garnered you more clients, or helped you retain employees, or simply given you back just a little bit of your precious time. You’re not the only person who is reading this book because you feel stuck, and you’re desperate for answers . . . and a nap. According to an article on 20SomethingFinance.com, the United States is the “most overworked developed nation in the world” (G. E. Miller, January 2, 2018). And here’s the irony: Americans are 400 percent more productive than we were in 1950. And yet, as employees, we work more hours and get less time off than employees in most countries. As entrepreneurs and business owners, our workload is even greater. As for time off? We don’t take any.

  I started writing this book when I asked myself a key question: Could my business achieve the size, profitability, and impact I envisioned without me doing all (or any) of the work? This question triggered my half-decade quest for answers—for me, and for the business owners and entrepreneurs I serve. For you.

  If you’re unfamiliar with my previous books, or if you’ve yet to hear me speak, I want you to know that my mission in life is to eradicate entrepreneurial poverty. I am committed to never again letting an entrepreneur live with lack: Lack of money. Lack of time. Lack of life. In my book Profit First, I sought to defeat one of the monsters that drives most entrepreneurs to despair: the lack of money. In this book, I’m going to help you slay an even bigger monster: the lack of time.

  Whatever answers you are looking for, in this book you’ll find real, actionable business efficiency strategies that have worked for countless entrepreneurs, numerous business owners, and for me, too.

  The goal is not to find more hours in your day. That is the brute force approach to business operations, and even when you pull it off, you’ll just fill that time with more work, anyway. The goal is organizational efficiency. In this book you’ll learn how to make simple but powerful shifts in your mind-set and day-to-day operations that will make your business run on automatic. I’m talking predictable outcomes, my overworked friend. I’m talking real, sustained growth. I’m talking a thriving workplace culture. I’m talking freedom to focus on what you do best, and what you love to do. And that, compadre, is the only way to build a truly successful business—by freeing ourselves to do the work we do best and the work we love most.

  We are also going to free you from the grind. We are going to relieve you from the constant pull on your time, your body, your mind . . . and your bank account. Yes, it is possible to feel at ease about your business. Yes, it is possible to regain the optimism you felt when you first started your company. Yes, it is possible to scale your business without killing yourself or sacrificing your own happiness.

  You need to stop doing everything. You need to streamline your business so it can run itself. I’m talking about your business running like a well-oiled machine, run by a highly efficient team that is aligned with your objectives and values. A business that runs, well, like clockwork.

  The process you will discover in this book is ridiculously simple. You will not find shortcuts, tricks, or hacks to packing more in. Instead, you will discover how to get the work done that matters most, avoid the stuff that doesn’t, and have the wisdom to know the difference. (Yeah, I borrowed a little bit from the Serenity Prayer. Serenity may seem like an impossible goal for most overworked visionaries like you. Heck, you’d probably settle for sanity at this point. But by following the seven steps I outline in this book, serenity is definitely back on the table, baby!)

  Life is about impact, not hours. On my deathbed, I will be asking myself if I fulfilled my life’s purpose, if I grew as an individual, if I truly served you and others, and if I deeply and actively loved my family and friends. If I may be so bold, I think you will be asking the same.

  It’s time to join the elite Clockwork Club. Seriously, make your stance and join us, first at our website, Clockwork.life,* and then at the beach one day soon. It’s time to get back to what you love—in your life, in your work, and in your business. It’s time to implement strategies with ease and joy. It’s time to bring balance back to your life. This book will help you do all of that.

  That is my wholehearted promise to you.

  CHAPTER ONE

  WHY YOUR BUSINESS IS (STILL) STUCK

  As is traditional for many people born and bred in the Garden State, every summer my wife and I pack up the kids and meet my sister and her family for a week of fun at the Jersey shore. Up until a few years ago, our summer trip went something like this: Everyone would spend the day at the beach and then the adults would start happy hour around four p.m., talk a big game about hanging out until the sun rises, and then promptly fall asleep by seven p.m.

  Except I hardly ever made it to happy hour or spent much time at the beach. I was working. Always. When I wasn’t focused on completing a project, or in a meeting, I was trying to sneak “a few minutes” to check emails. When I did make it outside t
o join everyone, I was so distracted by thoughts of work that I wasn’t really there. This caused me stress and annoyed the heck out of my family.

  Every year, I tried to break the “workcation” habit. I had the same plan: I would get all of my work done in advance so that “this time,” I could finally enjoy my vacation and be fully present with my family. Then, I thought, I would return from vacation with no work to do, or at least very little, and easily get back up to speed. But my plan never worked out. Often, it was just the opposite of what I planned.

  The last time I tried to prove that I really could work this vacation plan was a total disaster. A problem with a client came up the afternoon of the day before we were to leave. I can’t even remember what the problem was, but, at the time, I thought it was important enough to work on the solution well into the night. Then I stayed up even later to finish the work I had to do before the client crisis.

  It was nearly dawn before I made it back home from work. I slept for three hours, then headed to Long Beach Island. (If you aren’t from New Jersey, I want you to know that LBI is the real Jersey shore, not the boozefest of a show that lays claim to it.) Before I went to the beach, I decided to check my email to “make sure everything was okay.” It wasn’t. The rest of my day was spent making calls and sending emails. Even when I made it to the beach the next day, my mind was on the business and my body was dying for sleep. Yet again, I wasn’t really there. My family’s vacation was compromised, too, because my tension spread like smoke in a bar. One person can really stink up the place and ruin everyone else’s fun.

  My wife was frustrated with my workaholic ways, and so, one afternoon, she sent me for a walk on the beach—without my phone. As I looked at the beachfront houses, I thought, “The people who vacation at those mega-mansions have it all figured out.” They had financial freedom. They could take vacations and not worry about work. They could enjoy themselves and come back to a business ticking along, still growing, still making money. That’s what I wanted.