Traction: Get a Grip on Your Business

by Gino Wickman

This book is not another silver bullet management book or flavor-of-the-month strategy. It contains no theory. It’s based on real-world experience, practical wisdom, and timeless truths. More importantly, it works. Through hands-on experience, I have developed a practical but thorough method to help strengthen and reenergize your business.

core disciplines

This book contains all the tools and components that make up the Entrepreneurial Operating System (EOS). EOS is a holistic, self-sustaining system that addresses the six aspects of your business.

In the last 11 years alone, I’ve completed more than 1,300 full-day sessions with the leadership teams of over 120 entrepreneurial organizations. That adds up to over 10,000 hours of hands-on planning, teaching, coaching, facilitating, and solving leadership problems; EOS is the culmination of all that hard work.

My typical client is an entrepreneurial small to mid-size organization ($2 million to $50 million in revenue with 10 to 250 employees),

On average, my clients’ businesses grow revenue by 18 percent per year.

After EOS, you’ll make quicker decisions to change people, strategy, systems, and processes where necessary. It will help you reduce needless complexity, identify and remove distractions, identify and troubleshoot any problems, and keep you and your people engaged and focused on a single vision. The

at any time you get stuck, don’t hesitate to reach out to us, as we now have a complete online support platform to help the many thousands of leaders in our community at no cost.

practical understanding of the two essential ingredients of any great team: the right people in the right seats.

GWC, which addresses the three absolutes for any good hire. They must get it, want it, and have the capacity to do it.

A Scorecard is a weekly report containing five to 15 high-level numbers for the organization. In the Data Component chapter, you will learn to create and implement this powerful tool into your company.

You can also fill out the questionnaire online at www.eosworldwide.com /checkup.

ORGANIZATIONAL CHECKUP For each statement below, rank your business on a scale of 1 to 5 where 1 is weak and 5 is strong.

You must build and maintain a true leadership team. 2. Hitting the ceiling is inevitable. 3. You can only run your business on one operating system. 4. You must be open-minded, growth-oriented, and vulnerable.

You and your leadership team need to understand this, because you will hit the ceiling on three different levels: as an organization, departmentally, and as individuals.

In fact, most companies need to start with a focus on internal growth before they can even think about external growth. The paradox is that they will actually grow faster externally in the long run if they are focused internally from the outset.

Above all else, your leaders need to be able to simplify, delegate, predict, systemize, and structure.

Simplifying your organization is key. This entails streamlining the rules you operate under as well as how they’re communicated. The same goes for your processes, systems, messages, and vision. Most organizations are too complex when they begin. Use models, visuals, acronyms, and checklists to simplify processes and procedures, because as your organization grows, it will get more complex.

Your ability to break through the ceiling also depends on your ability to delegate. Be prepared to “delegate and elevate” to your true god-given skill set. You’ll have to delegate some of your responsibilities and elevate yourself to operate at your highest and best use.

Long-term predicting is the forecast of everything 90 days and beyond. To do so, your leadership team has to know where the organization is going and how you expect to get there. You do this by starting with the far future and working your way back. What is your 10-year target? What is your three-year picture? Your one-year plan? What do you have to accomplish in the next 90 days in order to be on track?

Long-term predicting is not really about foretelling what will happen; it’s making a decision about what you will do tomorrow based on what you know today.

The first step is to agree as a leadership team on what these processes are and then to give them a name. This is your company’s Way of doing business. Once you all agree on your Way, you will simplify, apply technology to, document, and fine-tune these core processes. In doing so, you will realize tremendous efficiencies, eliminate mistakes, and make it easier for managers to manage and for you to increase your profitability.

Your company needs to be organized in a way that reduces complexity and creates accountability. In addition, this structure should also be designed to boost you to the next level.

In summary, once you understand that hitting the ceiling is inevitable, you and your leadership team must employ these five leadership abilities to reach the next level: (1) simplify the organization, (2) delegate and elevate, (3) predict both long-term and short-term, (4) systemize, and (5) structure your company the right way.

In summary, the four fundamental beliefs are as follows: 1. You must build and maintain a true leadership team. 2. Hitting the ceiling is inevitable. 3. You can only run your business on one operating system. 4. You must be open-minded, growth-oriented, and vulnerable.

An example of a V/TO appears on the next page, and an electronic version of the V/TO can be downloaded free at www.eosworldwide.com/vto.

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?

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. You will also find that when they are applied in your organization, they will weed out the people that don’t fit. Once they’re defined, you must hire, fire, review, reward, and recognize people based on these core values. This is how to build a thriving culture around them.

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.

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.

1. Why does your organization exist? What is its purpose, cause, or passion? When your purpose, cause, or passion is clear, you won’t be able to tell what business you’re in. You should be able to take it into any industry. This will also keep you from confusing it with your niche.

When your purpose, cause, or passion is clear, it should meet all eight points of the following checklist: 1. It’s stated in three to seven words. 2. It’s written in simple language. 3. It’s big and bold. 4. It has an “aha” effect. 5. It comes from the heart. 6. It involves everyone. 7. It’s not about money. 8. It’s bigger than a goal.

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.

Examples of 10-year targets ZenaComp: $10 million in revenue with 15 percent net income Autumn Associates: A referral from every client and every client from a referral McKinley: 20,000 multifamily units owned and/or managed Atlas Oil Company: 5 billion gallons moved Schechter Wealth Strategies: 15 percent of target market

Identifying your target market involves defining your ideal customers. Who are they? Where are they? What are they? You need to know their demographic, geographic, and psychographic characteristics. By identifying your target market, you create a

filter. Out of that comes The List of perfect prospects for your organization and sales team to target.

was. Eventually, we realized that it was the presidents and CEOs of real estate organizations with 200 or more agents (demographic) in North America (geographic) that saw the value and need for outside sales training (psychographic).

size. Every organization has one or two very specific figures that are a telltale sign of the size of the organization. It might be a number of clients, large clients, units, or widgets produced.

Factors to consider include things such as number and quality of people, added resources, office environment and size, operational efficiencies, systemization, technology needs, product mix, and client mix.

We’re now going to the traction side of the V/TO, which is about bringing your long-range vision down to the ground and making it real. That means deciding on what must get done this year.

With the three-year picture in mind, discuss, debate, and decide on the three to seven most important priorities that must be completed this year in order for you to be on track for your three-year picture.

Every 90 days, your leadership team comes together to establish its priorities for the next 90 days based on your one-year plan. You discuss and ultimately conclude what has to be executed in the next quarter to put you on track for the one-year plan, which in turn puts you on track for the three-year picture, and so on.

Ask the team to think of the obstacles, concerns, and opportunities you face in achieving your vision.

You can effectively communicate the company vision in three events: 1. Have a company kickoff meeting and unveil your clearly defined vision (the V/TO). This is an opportunity to share your newly created core value speech for the first time. Make sure to include question-and-answer time. 2. Every 90 days, have a short (no more than 45-minute) state-of-the-company meeting with all employees. The objective of this event is to share successes and progress, review the V/TO, and communicate newly set company Rocks for the quarter.

The quarterly state-of-the-company has proven to be the most effective discipline for helping people share, understand, and buy into the company vision. In its purest form, the meeting has a three-part agenda. 1. Where you’ve been

2. Where you are 3. Where you are going

3. Each quarter, as you set Rocks in each department, conduct a complete review of the V/TO as a team.