Clockwork: Design Your Business to Run Itself Read online

  But as I looked closer, I saw person after person sitting on their decks frantically plugging away on their laptops. I even saw people on the beach, with laptops perched precariously on their knees, scared of sand getting in the keyboard while they tried to shield their screens from the glare of the sun. The people I assumed had it all together weren’t any different from me. They were all working on vacation. What the f?

  At this point in my life, I had built and sold one multimillion-dollar business to private equity and another one to a Fortune 500 company, written two business books, and spent a good part of my year speaking to thousands of entrepreneurs about how to grow their companies quickly and organically. Sounds like I was living the dream, right? You would think that I had retired my workaholic badge for good. But stressing out about work on yet another vacation proved I hadn’t. I wasn’t even close. And it was clear: I was definitely not alone. Neither are you.

  THE SOLUTION IS NOT THE SOLUTION

  I thought the cure for my workaholicism was better productivity. If I could just do more, faster, I could find more time for my family, for my health, for fun, and to get back to doing the work I really loved. The work that fed my soul.

  I was wrong.

  In an effort to be more productive, I tried it all: Focus apps, the Pomodoro method, working in blocks. Starting my day at four a.m. Ending my day at four a.m. Lists on yellow notepads. Lists on my phone. Lists of just five things. Lists of everything. Back to lists on yellow notepads. The “Don’t Break the Chain” method, which quickly led me to the “Chain Myself to My Desk” method. No matter what hack or technique I tried, no matter how productive I became, I still slipped into bed at night long after I should have, and woke up the next morning way earlier than I should have, with a to-do list that seemed to have magically grown overnight. Maybe I did things faster, but I surely didn’t work fewer hours. If anything, I worked more. Maybe I was making progress on many small projects, but many more new projects were filling up my plate. And my time was still not my own. All my years of studying productivity had given me nothing but more work. It was an epic fail.

  If you haven’t tried some of the productivity strategies I rattled off like bad failed diet plans, I’m sure you have your own list. An entire industry is built around the desire to do more, faster. Podcasts, articles, and books; mastermind groups and coaches; productivity challenges, calendars, journals, and software. We buy into the next productivity solution someone recommends because we’re desperate. Desperate to grow our companies by getting more done faster, and managing all our work without losing our minds.

  Some productivity experts are getting out of the “time hacks” game. As I was doing the research for this book, I befriended former productivity maven Chris Winfield. He had just completed one of his fabled retreats where he teaches twenty or so business leaders and professionals how to do more things in less time.

  We met for coffee in New York City near Lincoln Center so he could teach me what it really took to be productive. I was ready to finally discover the productivity secret that would release me from my stress-ridden life. I arrived forty-five minutes early. I couldn’t wait to find the ultimate hack. Chris arrived exactly on time, to the minute—typical of a productivity expert.

  After we made the obligatory “this coffee is really good” comments, Chris looked me right in the eye and said, “Productivity is shit.”

  “Wha . . . ?!” I said, nearly spitting out my deliciously balanced Fazenda Santa Ines coffee. I can become a bit of a coffee snob (or, my preferred title, a “beanologist”) when I have forty-five minutes to kill before a meeting.

  “It’s shit, bro. I have been teaching productivity for years and everyone I have taught is actually working more, including me.”

  I said, “I don’t get it. Why is that?”

  “Because productivity leaves everything on your plate. Productivity allows you to do more, faster. The pivotal word being ‘you.’ You can do more, therefore you in fact do more, and you do it all. Even when you say you are outsourcing the work, you really aren’t, because you can’t outsource the decisions. You are giving one task to someone else, but they come back at you with one million questions. You actually need to work even more, when you try to not do the work.”

  Chris continued. “I’m telling you, Mike. Productivity is hurting a lot of people. I’m done dying from it, and I’m done preaching about it, too. I am leaving the industry so that I can start working less, begin making more, and live life.”

  Mind. Blown.

  It turns out that productivity doesn’t get you out of the doing; it just gets you doing more. I had started my clockwork quest by seeking the wrong holy grail!

  REVISITING PARKINSON’S LAW

  You and I both know extremely productive people who work sixteen hours a day. You and I absolutely know the “I do best when I cram” people. Maybe it’s you. Once upon a time, it surely was me.

  It took me about fifteen years to figure this one out. I actually wore the productivity master’s badge of honor—the workaholic badge. I was a proud member. I was the fastest task-ticker-offer in the land. (What? It’s a thing.)

  In my book Profit First, I applied Parkinson’s Law—“our consumption of a resource expands to meet its supply”—to profit. Just as we use all the time we have allocated for a project to finish it, we also spend the money we have, which is why most entrepreneurs rarely earn as much as their employees, much less turn a profit. The more money we have to spend, the more we spend. The more time we have, the more of it we spend working. You get the idea.

  The fix to this behavior is ridonkulously simple: limit the resource and you limit your utilization of it. For example, when, after you collect revenue, you allocate profit first and hide it away (in a remote bank account), you have less money to spend. So guess what? You spend less. When you don’t readily have access to all the cash flowing through your business, you are forced to find ways to run your business with less.

  And now that we’re talking about time, Parkinson’s Law is even more relevant. Whatever time you give yourself to work, you will use. Nights, weekends, vacations—if you think you need it, you’ll work right through your time off. This is the root cause of the failure of productivity. The goal of productivity is to get as much done as quickly as possible. The problem is, because you’ve prioritized a seemingly endless amount of time to running your business, you’ll continuously find a way to fill up the time. The more productive you are, the more you can take on. The more you take on, the more productive you have to be. Do you see how productivity is a trap?

  If you’re like me and most entrepreneurs I meet, you use the time you saved to do more work—just as Chris said. And not the work that feeds your soul. Not the work that could truly make a difference for your business. No, you do the next urgent thing. You put out the fires, and then you do the next tasks that will be the next fires, until you’re interrupted by some other even more urgent thing that pops up. You keep working your ass off and feeling as though the more progress you make, the more work you have.

  It was only after I met Chris Winfield that it dawned on me: Yes, productivity is important; we all need to make the best use of our time. To be unproductive is like sinning against the business gods. (Plus, sittin’ around eating Cheetos and watching ThighMaster infomercials all day isn’t going to move anyone’s business forward.) But in time, I came to understand the real holy grail is organizational efficiency. Productivity gets you in the ballpark. Organizational efficiency gets you hitting home runs.

  Organizational efficiency is when all the gears of your business mesh together in harmony. It is the ultimate in leverage, because you design your company’s resources to work in concert, maximizing their output. Organizational efficiency is where you are accessing the best talents of your team (even a team of one) to do the most important work. It is about managing resources so that the important work gets do
ne, instead of always rushing to do what’s most urgent. It is not about working harder. It is all about working smarter.

  For far too many of us, twenty years of business ownership is celebrated by realizing that we survived twenty years of a continuous near-death experience. But it doesn’t have to be that way. You are not alone. There are millions of people just like you. I was one of them, and I’m here with you. In fact, I’m still progressing further and further on this stuff, even as I write this. I still have to remind myself to work smarter, not harder; it’s so easy to fall back into believing there’s a magic productivity hack that will save the day. Whatever choices you made to get you to this day, it’s okay. It got you here. You’re in the park. Now, put down that frankfurter and sauerkraut, and step on the field, crackerjack. You are about to hit the entrepreneurial homer of a lifetime. You can take a selfie right now, pointing to the stars, because you and your business are about to launch. Take your time and make a great pose. I’ll wait.

  So what’s the fix? We change the system around us so that we don’t need to change (we really can’t change much anyway) and set up the system so that it will channel our natural tendencies to achieve the outcomes we want.

  Part of the Clockwork solution is to actually restrict time, to use Parkinson’s Law to our advantage. But that alone won’t get us off the hamster wheel. When we give ourselves less time, we also need to figure out where to focus the remaining time. It’s not about doing more with less. It’s about doing less with less to achieve more. You need to do the right tasks with your restricted time and have other people do the right tasks with their restricted time.

  In other words, a business that runs like clockwork is about selective efficiency, not mass productivity.

  PLAYING IT SAFE

  My first business coach, Frank Minutolo,* saw me through three startups and two acquisitions, including one sale to a Fortune 500. Frank brought the Japanese company Konica to the United States, and grew it from a startup to $100 million. After he exited, he pursued his life’s calling: coaching a handpicked group of young(ish) entrepreneurs. I was one of the lucky thirty or so who could call him their adviser.

  I’ll forever be indebted to Frank for his no-nonsense, sage advice. I based my book The Pumpkin Plan on the simple strategy to rapid organic growth that he taught me. It started with our first face-to-face meeting. He had spent four hours with our team evaluating every aspect of our businesses, and then we had a one-on-one immediately after.

  Frank looks a little like Regis Philbin and sounds a little like the Godfather. “Mike,” he told me, “you need to get smarter about growing your business. You don’t want to put in all this effort, endure all this stress, only to end up with nothing to show for it. Your retirement will be spent in a rusty lawn chair with one nut hanging out of your shorts, while you regret your life of toil.” One nut? What the hell? That description was the weirdest thing I’d ever heard. It is just something that once you picture it, it can’t be unseen.

  It turns out that vividly descriptive visions of your client in a decrepit state, peppered with some flagrant genitalia references, is a shockingly effective sales strategy. I hired Frank that day, and he subsequently ensured that I avoided that nasty future by helping me rapidly grow and sell two companies. But it was only after ten years of working together that I finally got what he was trying to tell me. Fear can be a massive catalyst for change.

  One afternoon, I took Frank out to lunch at Fuddruckers and finally asked him why he would share such a bizarre story on the very first day I met him. Frank chuckled one of those old-guy chuckles where laughter turns into a minor fit of choking.

  “The point of that story,” Frank explained, “is that the roadblock is you. The problem is the draw of the familiar. Entrepreneurs aren’t that different from any other human, in that when something is familiar, it becomes comfortable. Entrepreneurs—you included, Mike—work like animals. And while you say you ‘hate it’ or ‘won’t do it anymore,’ the truth is, you are familiar with it. And when you are familiar with something, as ugly as it is, it is easiest to keep doing it. Doing what’s familiar will land you in that rusty lawn chair, with a nut hanging out of your shorts.

  “My goal is to make you more fearful of doing what’s safe and familiar, than taking the leap to the promising new. I wanted you to be terrified of the path you were on. I used your fear of where you were comfortably headed to move you to the new uncomfortable place you needed to go.”

  As painful as it can be to be stuck in the grind, our belief that we need to “work more” and “work harder” becomes familiar. Despite our exhaustion, the situation is comfortable, so the same problems yield the same solutions. Working long hours does not require us to step out of our comfort zone, or learn something new, or let go of our ego-driven need to micromanage.

  Entrepreneurs have become way too comfortable with the hardship, so they keep doing the things that keep them in that state. If you want to make your business the most efficient it can be, you must stop doing what you are doing, which is getting in your own way. You doing the work, or inserting yourself in other people’s work, may be all you know to this point. It may be very comfortable by now. Stop doing it.

  THE SURVIVAL TRAP

  If you’ve read my previous books, you have probably heard about the Survival Trap. I have talked about the Survival Trap for a long time now. And, still, I’m going to return to the Survival Trap because, unfortunately, this is the state most of us entrepreneurs end up in, and very few of us ever escape from.

  The Survival Trap is what I call that never-ending cycle of reacting to whatever comes up in your business—be it a problem or an opportunity—in order to move on. It’s a trap because as we respond to what is urgent rather than what is important, we get the satisfaction of fixing a problem. The adrenaline rush of saving something—the account, the order, the pitch, the entire damn day—makes us feel as though we are making progress in our business, but really, we are stuck in a reactionary cycle. We jump all about, fixing this, saving that. As a result, our business careens to the right, then to the left. Then we throw it in reverse, and jam it forward. Our business is a web of misdirection, and over the years it becomes a knotted mess—all because we were just trying to survive.

  The Survival Trap is all about getting through today at the utter disregard for tomorrow. It’s about doing what is familiar, as Frank warned. We feel good that we survived the day. But then, at some distant point in the future, we wake up and realize that years and years of work didn’t move us forward one iota, that merely trying to survive is a trap that results in a long, drawn-out drowning of our business and our willpower.

  Sadly, you will discover that living in the Survival Trap leads to a very trashy day-to-day life of quick highs, deep lows, and doing anything to make a buck. Quite frankly, it is not the life of the coveted entrepreneur; it is the life, shrouded in shame, of the entreprewhore. I too was one. I was addicted to doing whatever anyone wanted at whatever price they offered. I prostituted my business to survive just one more day, and then I continued that behavior as I expanded into multiple disastrous businesses.

  Ten years ago, I cleaned up my act, and got out for good. I started by taking my profit first, as I shared in Profit First. Then, by focusing on my Top Clients, my business grew fast and organically. Today, I am in the final stages of reclaiming my life because I have designed my business to run on automatic. You are about to do the same.

  In Profit First I wrote a little section that was the seed of this book: “Sustained profitability depends on efficiency. You can’t become efficient in crisis. In crisis, we justify making money at any cost, right now, even if it means skipping taxes or selling our souls. In crises, the Survival Trap becomes our modus operandi—until our survival strategies create a new, more devastating crisis that scares us straight or, more commonly, scares us right out of business.”

  Was Celeste, the
preschool owner I mentioned in the introduction, caught in the Survival Trap? Most definitely. She was experiencing the extreme version of the trap. You may be comfortable in your trap. Maybe it’s manageable. Maybe you take pride in managing it. But what does that matter if you’re still in the trap?

  The Survival Trap is what’s keeping you from driving toward your vision, or meeting short- or long-term goals. In some sense, we know this. We feel guilty about that five-year plan we haven’t looked at in seven years. We see other businesses launching new initiatives or products in alignment with trends, and we wonder how they found the time to predict and respond to the changes in our industry. (They must have superpowers, right?) We know we’re behind in terms of making the best use of innovations in technology and workplace culture. And we know that in order to take our business to the next level, we need to get back to our visionary roots—the ideas and plans and heart we had when we first started our business.

  It’s hard to escape the Survival Trap because your business constantly pulls you back into keeping it afloat. But I’m going to show you how to escape it for good by designing your business to run itself and freeing yourself to do only what you want, when you want. So let’s get busy getting unbusy, why don’t we?

  THE SEVEN STEPS OF CLOCKWORK

  In the next seven chapters, we’ll cover the steps you’ll need to take to make your business run like clockwork. One step may take longer than another, and you may find yourself having to go back and improve one of the steps from time to time. This process may take you two days or two months, but if you follow the steps, you’ll get there.