Traction: Get a Grip on Your Business

by Gino Wickman

One person can only make so many decisions and solve so many problems. You cannot build an enduring, successful organization that lives beyond you if your organization is designed to crumble the minute you step aside. Until now, you’ve probably been holding all the pieces together on your own. But once your organization reaches a certain size, you won’t be able to lead that way. If you want to grow, it’s not possible to maintain a hand in sales, service, accounting, complaints, and follow-up on a regular basis. This means that it’s time to let others take control of those areas, and that you have to decide who you want to do so. Each of your departmental heads should be better than you in his or her respective position. Of course, you will need to give them clear expectations and instill a system for effective communication and accountability. Once you have the right people in the right seats, let them run with it.

When you let go, however, you need to make sure you’re letting go of the right duties. The responsibilities that you delegate to other people have to be tasks that you have outgrown. These include things such as opening mail, writing proposals, approving invoices, and handling customer complaints. Sometimes we’re afraid to pass off jobs that aren’t much fun for others, but, at a certain point, you’ll have to. The beauty of this transition is that there are people who have the skills and enthusiasm to do these jobs.

Put another way, your leadership team has to “climb the tree” more often than others. I liken long-term prediction to a team of short-sighted people cutting a road through a jungle. They may be the most productive team that’s ever cut a road, or they may be twice as productive as any other team before them. However, if there’s no leader there to climb a tree and tell them where the road is going, they might very well be cutting a zigzag. Get good at taking the long view. As leaders, you’ll need to stop working in the business 100 percent of the time, and as Michael Gerber, author of The E-Myth and The E-Myth Revisited, puts it, work on the business every so often instead. This discipline will get you to where you want to go faster.

You have to be willing to ask for and receive help. Most of all, you have to know your strengths and weaknesses and let other people who are more skilled than you in a certain area take charge.

As he well knows, most entrepreneurs can clearly see their vision. Their problem is that they make the mistake of thinking that everyone else in the organization sees it too. In most cases, they don’t, and as a result, leaders end up frustrated, staff ends up confused, and great visions are left unrealized.

Entrepreneurs must get their vision out of their heads and down onto paper. From there, they must share it with their organization so that everyone can see where the company is going and determine if they want to go there with you.

What is vision? It’s clearly defining who and what your organization is, where it’s going and how it’s going to get there.

To the degree everyone on the team can answer the following eight questions and absolutely agree, you will have a clear vision. By answering the following eight questions and filling out the V/TO, we will clarify exactly what your vision is. Let’s get started. The eight questions are as follows: 1. What are your core values? 2. What is your core focus? 3. What is your 10-year target? 4. What is your marketing strategy? 5. What is your three-year picture? 6. What is your one-year plan? 7. What are your quarterly Rocks? 8. What are your issues?

WHAT ARE YOUR CORE VALUES? What are core values? They are a small set of vital and timeless guiding principles for your company. A good rule of thumb is to limit them to somewhere between three and seven. As always, less is more. These core values define your culture and who you truly are as people. When they are clear, you’ll find they attract like-minded people to your organization.

First, schedule time with your leadership team. I recommend a minimum of two hours, preferably away from the office, as strategic thinking is always best done off-premises. In that meeting, you proceed as follows:

STEP 4 Here is where you’re going to make some tough decisions. Through group discussion and debate, decide which values really belong and are truly core. Remember, your goal is to get your list down to between three and seven.

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The next step in the process is to communicate these core values to the rest of the organization. It’s time to create your presentation speech. People won’t necessarily understand what you mean if you merely state each core value. That’s why each one needs to be backed up with stories, analogies, and creative illustrations to drive home its importance.

When writing your core values speech, make sure you word each core value with the same pattern or tense (e.g., “To always …” or “We always …”). Make sure to bullet-point three to five supporting examples under each. This will give you a rough guide of how the speech should be laid out. From there, you can improvise.

Reputation outweighs profit every time.

WHAT IS YOUR CORE FOCUS? It doesn’t take much for an organization to get off track in the hustle and bustle of the business world. Businesses can easily become distracted by opportunities that are wolves in sheep’s clothing. Others falsely assume that since they are succeeding in one business, they can succeed in any. Others simply get bored. Your job as a leadership team is to establish your organization’s core focus and not to let anything distract you from that. Many things have the potential to distract us from our core focus. Steve, a member of one leadership team, calls it “shiny stuff.” A competitor, a new idea, a new product, and poor advice that looks like good advice at the time are just a few examples.

Most people are sitting on their own diamond mines. The surest ways to lose your diamond mine are to get bored, become overambitious, or start thinking that the grass is greener on the other side. Find your core focus, stick to it, and devote your time and resources to excelling at it.

When business owners get bored, there is always the potential for them to get distracted by the shiny stuff and inadvertently sabotage what they’ve created. Fading passion and losing sight of why you’re in business are other pitfalls that could lead to the same fate. Defining your core focus will return you to your original levels of clarity and excitement.

While a new idea may look like a no-brainer on paper, it’s simply not worth doing if it’s not a part of your core focus.

When your core focus is clear, you’re going to come to several important realizations. You’ll realize that certain practices, people, and, sometimes, entire divisions and/or product lines don’t fit into your core focus. As a direct result of this discovery, past EOS clients have gotten rid of entire departments and excelled as a result.

Decide what business you are in, and be in that business. As the old saying goes, “He who chases two rabbits catches neither.” Or as Al Ries pointed out in Focus, “Imagine a medical practice saying to itself: ‘We are known as terrific brain surgeons, so let’s get into the heart, liver, lung, and limb businesses.’”

As Jim Collins puts it in his bestseller Good to Great, “You have to figure out what you’re genetically encoded to do.” That’s a vital point. The combination of your talents and passions combined with your leadership creates something unique that no other company has, and that something is your core focus.

1. Why does your organization exist? What is its purpose, cause, or passion?

2. What is your organization’s niche? Your niche should be simple. It will ultimately become a filtering mechanism for your team to make its decisions as you move forward. Orville Redenbacher’s theory says it all: “Do one thing and do it better than anyone.”

Once your core focus is clear, you’ll need to stay true to it. If a new business opportunity doesn’t fit, don’t do it.

Until you have exhausted every opportunity in your core focus, don’t allow yourself to get distracted by the shiny stuff.

WHAT IS YOUR 10-YEAR TARGET? Now that your core values and core focus are clear, the next question is this: What is your 10-year target? Where do you want your organization to be a decade from now?

One common thread unites successful people and successful companies. All of them have a habit of setting and achieving goals.

In their book Built to Last, Jim Collins and Jerry I. Porras found that organizations that have endured for decades share another common practice: They all set massive 10- to 25-year goals. Collins and Porras refer to these as BHAGs—Big, Hairy, Audacious Goals—and define them as having “a long-term vision so daring in its scope as to seem impossible.”

In You2, Price Pritchett explains how to make such quantum leaps: “You must focus on ends, rather than means.” Your long-term target is that end he is describing. He continues, “It is crucial to have a crystal clear picture of what you want to accomplish … Rivet your attention on that spot where you are to land at the end of your quantum leap … Once you do that, it’s almost as if you magnetize yourself to the ways and means involved in the methodology for getting there. Solutions begin to appear. Answers come to you.”

Debate and decide which are the three that truly make you unique, and which matter to you and your customer. The individual uniques don’t have to be different from those of your competition. It’s the combination of all Three Uniques that makes you different. No one else should do all three the way you do.

YOUR GUARANTEE The fourth and final element of your marketing strategy is your guarantee. Think of what Federal Express did with overnight delivery: “When it absolutely, positively has to be there overnight.” Domino’s did the same with pizza delivery: “Thirty minutes or it’s free.”

A guarantee is your opportunity to pinpoint an industry-wide problem and solve it. This is typically a service or quality problem. You must determine what your customers can count on from you. If you guarantee it, that will put their minds at ease and enable you to close more business.

Go after all of the prospects on The List, communicating with them why you’re unique, showing them your proven process for doing business, and offering them your guarantee. This incredible precision in your sales and marketing efforts will increase your sales dramatically.

Remember, less is always more. Most companies make the mistake of trying to accomplish too many objectives per year. By trying to get everything done all at once, they end up accomplishing very little and feeling frustrated.

When everything is important, nothing is important.

The number one reason employees don’t share a company vision is that they don’t know what it is. The only way you can determine if your vision is shared by all is simply to tell them.

People need to hear the vision seven times before they really hear it for the first time.

RIGHT PEOPLE With the answer to the first question on the V/TO—“What are your core values?”—you now have the ability to define who the right people are for your organization. It’s important to note that whatever your core values are, they don’t make the people who don’t possess them right or wrong, nor do they make them good or bad. They just don’t fit in your company culture. If they go somewhere that has their values, they’ll be fine

Assuming that three major functions exist in all organizations, the next truth is that they must all be strong.

In order to maintain accountability, only one person can ultimately be in charge of any major function within an organization. Only one person oversees sales and marketing, only one person runs operations, and only one person manages finance and administration. When more than one person is accountable, nobody is.

The visionary and the integrator couldn’t be more different. In a small to mid-size company, the visionary is typically the owner, co-owner, or founder. In a partnership, most of the time, one partner is the visionary and the other is the integrator. It’s a dynamic that has elevated them to where they are. The visionary typically has 10 new ideas a week. Nine of them might not be so great, but one usually is, and it’s that one idea each week that keeps the organization growing. For this reason, visionaries are invaluable. They’re typically very creative. They’re great solvers of big ugly problems (not the little practical ones), and fantastic with important clients, vendors, suppliers, and banking relationships. The culture of the organization is very important to them, because they usually operate more on emotion and therefore have a better barometer of how people are feeling. If you’re one, know thyself and be free.

By contrast, integrators are typically very good at leading, managing, and holding people accountable. They love running the day-to-day aspects of the business. They are accountable for profit and loss, plus the overall business plan for the organization. They remove obstacles so that people running the major functions can execute. They’re great at special projects. In sum, they operate more on logic. If you are one, know thyself and be stressed.

It’s common for a company to have a visionary but no integrator. This causes a real struggle, because the visionary is constantly frustrated with his or her lack of traction. In addition, he or she has to keep acting as the integrator and get pulled into the day-to-day management of the business.

Get It You’ve seen people who get it and people who don’t. “Get it” simply means that they truly understand their role, the culture, the systems, the pace, and how the job comes together. Not everyone gets it. The good news is that there are plenty who do. Want It This means they genuinely like the job. They understand the role, and they want to do it based on fair compensation and the responsibility. In many instances, a manager feels the need to motivate, overpay, or beg a person to want it, when the reality is they don’t. Sometimes their ego, your hopes, or their ignorance about what the job entails will lead them to think that they want it. But if they don’t, they’re never going to provide that spark, no matter how effective a manager you are. So stop beating your head against the wall. Find someone who does want it, and the difference will be immediately apparent. Capacity to Do It Capacity means having the time as well as the mental, physical, and emotional capacity to do a job well. Sometimes, a position might require a commitment of 55 hours a week where the person is only willing to commit 40. Sometimes the job requires a certain level of intellect, skill, knowledge, and emotional intelligence, and the person doesn’t have that capacity. This is the Peter Principle at its finest, where people are elevated to a level of incompetence.

If you’re at 120 percent, you’re holding the organization back and probably starting to burn out.

What gets watched improves.

It’s human nature to put off making a hard decision. If given the option, most people would prefer not to address an issue and hope that it goes away on its own. This reluctance to act can be a drag on growth and is extremely frustrating to watch. As Napoleon Bonaparte said, “Nothing is more difficult and therefore more precious than to be able to decide.”