About the Host
Ryan is an entrepreneur, podcast host of the show Life After Business and the co-owner of Solidity Financial. Having personally experienced the hazards of selling a business, he joined up with his friend Brandon Wood to educate others on the process. Through their business (Solidity Financial), they provide a platform for entrepreneurs called The Value Advantage™ that helps in exit planning, value building and financial management.
About the Guest
The valuation of your life work and business is a direct reflection of the leadership remaining in place after you exit. What does it mean to build a company of leaders? How do you do that? What does it mean to be increasing wealth so everyone profits?
Today we’ll be talking to Kevin McCarthy, the Chief Leadership Officer of On-Purpose Partners,a deep strategy and planning business advisory firm. Kevin is also the author of several books, including The On-Purpose Person and The On-Purpose Business Person. Today he’s going to talk to us about how to find your purpose and his multi-decade journey trying to reinvent how an entrepreneur can change his or her business.
If you listen, you will learn:
- Information about Kevin’s background that helped him get where he is now as the CLO of On-Purpose Partners.
- Where entrepreneurs go off-course when it comes to identifying and sticking to their purposes.
- What purpose means to Kevin as well as how having purpose minimizes confusion.
- How the On-Purpose Pal can help you stay aligned with your values, as well why Kevin recommends a two-word purpose statement.
- How to figure out your purpose without having a tragedy.
- How an amortization chart can help you get on track with your purpose, as well as what “hellegation” means and how it might apply to you.
- Tips on how finding your purpose relates to your exit plan.
- An explanation of the Chief Leadership Officer title.
Ryan: Welcome to Life After Business podcast where I bring you all the information you need to exit your company and explore what life can be like on the other side. This is Ryan Tamson, your host. I hope you enjoy this episode.
Welcome back to the Life After Business podcast. Today’s guest name is Kevin McCarthy. Kevin is the partner and owner of On-Purpose Partners and the author of On-Purpose Person, On-Purpose Business Person, and the creator of the On-Purpose Principle. As you can tell, Kevin is all about purpose. What I really enjoyed about Kevin and our conversation was that he didn’t just come up with this term and this whole philosophy by accident. He was in real estate and finding out that most of these real estate investors didn’t have a business plan, so then he backed into helping them build a business plan so that way he can do the real estate deals.
He was super frustrated because he was realizing that none of these strategic plans were getting put in place, and it’s because individuals that are entrepreneurs and business owners didn’t know who they were or why they were doing anything. Kevin has been on a multi-decade journey, trying to reinvent how a business owner and entrepreneur looks at themselves and their business — and even addresses how we, as entrepreneurs, have this fear of being exposed that we don’t have it all figured out and we don’t necessarily have a game plan for our purpose and where we’re going.
He’s also the creator of the term Chief Leadership Officer (CLO) because he thinks that CEO is an outdated terminology with not a lot of relevancy to today’s world. We need to be Chief Leadership Officers. We can only do that if we know who we are and what our purpose is.
Kevin and I, in our conversation, dived into his On-Purpose Principles, how to find your purpose, what tools you can apply. He’s got a ton of really great stories for us from his experience. Without further ado, I hope you enjoy this episode with Kevin.
This episode of Life After Business is sponsored by The Value Advantage. The Value Advantage is the platform delivered via peer groups and/or one-on-one to help you build a valuable company that can thrive without you, while putting an exit plan in place so you have the option to sell when you want, to who you want, for how much you want. You’re able to manage the business by the numbers, work in the business as much or as little as you want, and you fully understand how the business impacts your personal financials. If you wanna know more, check out the show notes or the website.
Good morning, Kevin. How are you doing?
Kevin:I’m fine, thanks. Good to be with you.
Ryan: I’m glad that Tania Green introduced us because you have an awesome philosophy and background that changed the direction that she was bringing her company, and the Chief Leadership Officer title is what she originally brought up to me on our show. For our listeners, can you go back — you’ve been the President and owner of On-Purpose, your business, for quite a few years. Can you just give us the backdrop on how you started it and what the whole premise of it is?
Kevin: Sure. First of all, I’ve been very entrepreneurial since I was a little kid, so that’s an important aspect to that. But when I came through college and then graduate business school, I realized that I needed to learn a lot more about business and just going at it raw. I often described myself as an entrepreneur who’s got a classical business education in terms of that. I found that if I could understand the language and the methods of business, then I’d be a much better entrepreneur. I’d like to believe that’s true.
What happened is — I started off out of a graduate business school. I was working in the commercial real estate business. I went to work with a company called the Trammell Crow Company. I was only with them for a short period of time, and the entrepreneurial bug got a hold of me. I started a greeting card company, of all things, called Corporate Cackles. It was the first ever business-related greeting card line. That was a tough business, and I kept my hand in the real estate. The real estate took off, and then I became a commercial real estate developer. We were doing shopping centers, industrial parks and things like that.
I had a business divorce. I’m sure a few people have faced those sorts of things, where I had a business partner who was 15 years older than I was. The day I met him, I said to my wife, “Today I met a man who’s either a madman or a genius.” I was right; he was both. It’s just one of those things, where when that business divorce happened, I decided to start over. I started a real estate advisory business because I always had this love of business, then that emerged into a general management strategy business. Our official company title is US Partners Inc., but we actually do business as On-Purpose Partners. That’s just really history. Back then we were US Partners.
From that, I began to realize, because I was working primarily with mid-market CEOs — and what I found is a lot of them had real estate needs but they didn’t really understand what their real estate needs were, because they didn’t have necessarily business plans in place. They were running the business out of their head. To do the real estate right, I needed to back in into doing business planning. I began to look at workflow, people, requirements, what their growth is, and I ended up doing business planning.
Unfortunately, what would happen is I would do the business planning in order to get the real estate deal, but sometimes I wouldn’t get the real estate deal and all I would do is just give them a whole bunch of great information and stuff to help them grow their businesses. Finally, I said, “I need to get paid for this.” I started just doing the business planning side, but then I realized that a lot of these people that were doing this — the reason they didn’t have good business plans is because they didn’t have a sense of purpose and meaning in their lives. They didn’t have a life plan either.
This is, again, in the mid-80s. I’m working on this, and I’m having these conversations. People are looking at me like I’m from Mars because I’m talking about the purpose of your life and the purpose of your business, and “are they aligned?” Nobody was talking about purpose in the 80s; very few people were. Especially the way that I was speaking of purpose — I have a very specific definitions to it that we’ll probably get to.
I began to really look at this, and I saw that there was this big gap in the market between — the large corporate companies are often difficult because they’re so outward-driven by earnings-per-share and some things like that, but that person that owns their business — the type of person you work with, who’s got a business. They may be looking at an exit strategy or wanting to keep their business and make it better and better and better. Those are the type of people that I really enjoy working with.
What I found for a lot of them is that they had fallen into almost a set of their self-imposed golden handcuffs — that they have this business that was making money, and they didn’t necessarily enjoy the business anymore. Or they were doing things off-purpose. They were now having to become something that they weren’t, and they didn’t either have the capacity for that or the desire for that. But this business was making money, and they were somewhat unhappy. They may credit an unhappy culture.
I kept saying that “Work is neutral. The business is neutral. You bring the meaning and purpose to it.” What I was doing was trying to find out deep in their heart, in their soul, and their spirit, “Why do you exist in this world? How do you make a difference?” I then developed a methodology to help people write two-word purpose statements, then articulate their vision, then articulate their missions, and then articulate their values. The articulation of purpose, vision, mission, and values for an individual was really important, then the same thing was done for the organization.
Ryan: How cool. I don’t think I have ever met anybody that went from trying to do a real estate deal that all of a sudden merged into finding people’s passion and purpose. That’s an interesting transition, but the way that you articulate it makes a ton of sense.
Kevin: I migrated into it backwards — sort of reverse engineered into it, although I’d always had an interest from the time I was little. I read the book I’m OK — You’re OK when I was 12 years old. That book really touched my life because I realized I could choose my life. If I talk anything from that book way back when, that was it. I could choose my life differently, and I didn’t have to be a victim of circumstances or the other people. While I was just a kid, that philosophy took root in my life. I’m just not a person who deals with a lot of unrest or anxiety. It doesn’t hit me. I’m not saying I’m bulletproof, but as a result, I just look at it and say, “Okay, I’m responsible for me. Period.”
Ryan: I don’t wanna take us too much down a rabbithole, but do you practice [stellocism 0:09:28] at all?
Kevin: I don’t.
Ryan: Okay, I won’t go down that road because it’s a lot about being aware of your environment and how you can react to your emotions, and you being in control of your emotions but not necessarily environment. It’s some cool stuff.
With this whole purpose thing — to go back to the main point of what you’re saying — did you realize — my guess is it was through interactions that you’re talking to these entrepreneurs, where you see the lost part of their eyes or the deer in the headlights. Where do you think — to bring us back to this journey of how you’re taking people back on track and onto purpose, but do you believe at some point that these entrepreneurs were on track and on purpose or did they have the wrong alignment to begin with? What do you think the progression was?
Kevin: I’ll give you an analogy that I like to use, and that is — I used to teach tennis professionally at one point in my life when I was in my teens and through college and even through graduate business school. I helped pay my way by being a teaching pro — not a playing pro. One of the things I found is it’s a lot like tennis or any sport or some hobby or something that when you first learn it, there’s something about it that attracts you to it. There’s a spark, and then you start to go and you do it. The best thing to do is go get somebody who’s already doing it well, and they can teach you — like a tennis pro — to teach you how to play tennis or golf —- or teach you how to play golf.
A lot of people just grab a racket or clubs, and they go out and they hit. They develop all of these bad habits, but that doesn’t mean that they don’t have fun. But then they get frustrated because their game level’s off. I think a lot of it is that most of these entrepreneurs — they start off with something that sparks them — that says, “That’s what I’m interested in. That’s cool. That’s fun.”
I’ve got a 26-year-old son who went to Rhodes College in Memphis, has a liberal arts degree. We spent all the money on him. He’s got a summer internship one time, and he’s got time on his hands in the middle of the day. He goes to a welding college just because he always wanted to learn how to weld. Now, guess what, he’s got a welding business because he fell in love with welding. He’s going through all the things at 26. He’s got a business partner now. He has to deal with a business partner. He has to deal with employees. He has to deal with people that don’t pay him. He has to learn what it means to lead a bunch of people and not be a jerk.
There’s just all these things that are going on. In some regards, I’m like watching this — I’m having a ball watching my son go through all of this because he’s just making all these mistakes, and yet I can say to him, “Charles, just try this. You do this.” What happens is, we get this spark, but then the capabilities and the competencies that one has to develop to run a business are so much different than what it takes to be a welder.
It’s kind of like Michael Gerber’s The E-Myth, which is just a great book, that describes that transition from what he calls an entrepreneurial seizure. A welder who has an entrepreneurial seizure and says, “I’m gonna do a business.” What it actually takes to have a business, where you have to deal with insurance, income taxes, accounting — it’s so far from welding that most people don’t make that shift. What happens is some people do make that change, but they never really — they lose sight of what it was that got them excited in the beginning.
Ryan: Do you see a lot of people that — can’t remember. The Halftime calls it Smoldering Discontent or there’s this kind of purgatory. Do you see — of the people that you’re interacting with, how many people are just stuck in that area?
Kevin: I’m probably gonna be biased because the people who call me are generally the ones that are stuck. I see a lot of people that are stuck in that area. And/or I also get people, who are saying, “My business is growing crazy good. It just feels like it’s rapidly getting out of control. I don’t know how to bring it back in and how to put the systems and the strategies and structures in place that I need to be able to continually keep this going because I’m afraid it’s gonna implode on me.” I have some people that are forward-looking and are just, “I’m in over my head. What do I do?”
Ryan: I was gonna say — and then we can go into your methodology and your definition and stuff like that. What’s the first question they ask you? What’s the first thing that happens to someone to realize this?
Kevin: Usually, there’s a defining moment, where they will either — I’ve had companies that are 270 million and they call me, when they are now at 70 million. They’re on the skids. Or they are at $700,000 and they are on their way down to 150,000. There’s a big reversal trend that’s going on, and they’re scared. That’s often the time whenever I get the call, which is, “Holy mackerel. We need help.” A lot of that is a moment of humility. Unfortunately, what happens, I think, in a lot of us in business — I have always said that the greatest fear that most midsized small business owners have is the fear of exposure.
If they really understood, “I don’t know what I’m doing but I’ve gotta put on these airs, like I know what’s going on, I’m in charge. My ego can’t allow me because I’m the boss,” but the fear of exposure is there. Once the exposure is occurring, where it’s like, “I can’t hide from this anymore. The bank’s on my case, or creditors are on my case. Or people are turning over rapidly. The word's gotten out.” Now they get serious. Until they’re humble and serious, they’re not ready for me.
Ryan: Yeah. I think you summarized a lot of entrepreneurs. You got the fake side of — you gotta pretend that you got your shit together all the time. You’ve got this On-Purpose brand. You’ve got this On-Purpose methodology. Can you explain to us what does purpose mean for you?
Kevin: I have a little guide called The On-Purpose Pal. If I may, let me put him in context of purpose, vision, mission, and values. My belief is that purpose, vision, mission, and values are the language of leadership and strategy. When the language of leadership and strategy are confused, then the strategy and leadership of a company is confused, therefore the company is confused. Therefore it’s not getting its value proposition correct. It is a ripple of problems, everywhere down the income statement and on the balance sheet. Every line item is touched by this challenge.
Purpose is your reason for being. It’s answering the question “Why am I here?” It’s a matter of the heart. What’s interesting is most people agree that there’s a thing called mind, body, and spirit. We understand what to do to feed our bodies. We understand what to do to feed our minds by getting an education, learning, reading, listening to podcasts like you’re doing. But how do we feed our spirit? This is not necessarily going to church, although there’s nothing wrong with going to church, but it’s called “How do I feed my spirit and know who I am at a deep place?” Purpose is part of answering this question of this “who am I?” question by understanding why you’re here.
Vision — I symbolize that by the heart. If you were to draw a big heart, then above that heart, if you draw a big circle for a head, that’s your vision. You put some eyes on it — that’s your vision or what’s in your mind’s eye. That’s your dream; that’s what you’re imagining. When an entrepreneur sees their company as a visionary, maybe two to three years out, “We could do this and we could do this. I can have this software package. I can train these people, and we can expand to this market. Or I can have five stores instead of one.” Whatever it may be that they’ve got going on, that’s the vision that they have. That’s saying “Where are we going?”
The missions are symbolized by the hands and the feet. The hands have five fingers on each hand, for most of us, and five toes and everything. There’s lots of little missions that are along the way, but the big missions are “What do you do?” It’s symbolized by the hands and the feet and the color yellow. The heart is red, the purpose. The vision is blue; the blue sky thinking, and the dreams that are possible. The hands and feet are yellow, symbolizing that this is what I do. Purpose is why. Vision is what I see, and missions are doing. We’re painting a picture for him. We call him the On-Purpose Pal, and I’ve got a free download that people can get.
Ryan: I’ll put it in the show notes too for everybody. If they want to go to the show notes, there’ll be a picture of him.
Kevin: That would be great. Call him the On-Purpose Pal. Anyway, what you’ve got then is in the throat and in the gut, this is where your values are. If I ask you to violate your values, then you’re gonna feel it in your throat, you’re gonna have this choking response, like, “Ugh. Ugh.” Joan Rivers used to go, “Ugh, ugh, ugh.” It’s that sort of an experience that you’re having. Then if you violate your values, you feel that in your gut. You’re like, “Oh man, my stomach is turning on this one. I’ve got a gut feel that something is not right about this.” What I’m able to do is tie this language of leadership and strategy to parts of the body. It’s the heart, the head, the hands and feet, along with the throat and the gut.
When your heart, your head, and your hands are aligned within your values, you’re on your purpose.What I found is that this is actually a very simple — it’s simple for me, perhaps, but for a lot of people, they don’t have the methodology. It’s like they haven’t gone to a tennis pro to learn how to play tennis, so they’ve grabbed the racket. And they’ve developed all these bad habits, and they have all of these things. They are wondering why their game or why their business can’t get any better. It’s because they have self-limitations that they have imposed because they’re not getting that correction that they need at the deepest part of their game, if you will.
When we articulate purpose, vision, mission, and values, and then say, “Now let’s put together the plans to create the alignment. Now let’s find the people and educate the people — train them to it. Now let’s put the processes in place. Let that inform your processes, and then we’re gonna move it into your performance to serve the customers that you’ve identified as your core target audiences.”
Ryan: I like how you’ve tied together a lot of the strategic stuff, which makes sense based on your story of how you got there because strategic planning — they don’t it because they don’t know who they are and what their purpose is. My experience, whether it’s my personal experience or with the customers that I have worked with or people that I talked to, there’s a lot of — I don’t even know how you’d want to articulate — whether it’s the [Tracht 0:20:30] model, the Rockefeller’s, everything is about “What does the company want? Is it 50 million, 100 million? How many employees or how many markets?” There’s all of these specific business strategy but there’s not enough of the integration of the person. How do you align those two?
Which is why I love Tania Green’s episode because she obviously worked with you and you were able to figure out how to align those two, but I think that’s what the entrepreneurs are missing — the fire in their soul about why they are doing what they’re doing, not just some technical benchmark that they’re gonna hit because once you get there, it’s just as empty as when you started.
Kevin: The first strawman that I have to knock down is that work is the source of meaning. It is not your source of meaning; work is neutral. Your business is not your source of meaning. It may be your source of provision, but it’s not your source of meaning. If the business fails, it doesn’t mean you’re a failure.
Ryan: Let’s dive into that a little bit because I think everybody that I’ve talked to, even myself, agrees with that, but then everybody I’d actually talked to — that is usually the case, whether they identify themselves with their industry and their trade associations, how many are their customers, all that stuff. How do you break down that strawman? That is such a hard one, especially if you got decades of owning a business that you’re calloused around that. What if you have no idea who you are outside of your business?
Kevin: What I do is I help people write, individually, a personal two-word purpose statement. The reason I do two-word purpose statements is the simplicity of them, and they have a generic beginning. The generic beginning for an individual is, “I exist to serve by.” They have a statement like “liberating greatness” or “awakening worth” or “igniting joy.” What I’m doing is I’m giving them an action adjourned like awakening, liberating, igniting, and I’m matching it with an object such as joy, hope, greatness, promise, or whatever it may be. By creating those with this generic beginning of “I exist to serve by liberating greatness.”
Let’s just take a purpose statement like “liberating greatness.” What you can do with that is you can look at it and say, “Wow, here’s who I am.” I can give you a story of a guy, whose purpose statement was liberating greatness. In his life, he had gone through some really traumatic childhood stuff, where he was labelled developmentally retarded. This is back in the old days, whenever they used the word “retarded.” I’m not trying to be politically offensive or anything like that. As he matured, he had a teacher that realized that this kid had brains, but he didn’t believe he did.
He became a drunk, but he was successful. He became an engineer then he became a lawyer. He was living this facade of this very successful lawyer, who is a corporate lawyer doing all these things, and yet this drunk, scared-to-death person, who is afraid of being exposed for what he was. One day, a friend of his found him drunk on the side of a road — a guy that he worked with — and said, “Come with me. I’m taking you to AA.” He went to AA, and that’s where he was liberated his greatness.
He said, “My business was liberating greatness in others, but I had to have my greatness liberated. And until I was able to come to terms with who I was, then I could see the greatness that was built into me that I never knew was there.” He created this alignment that — I just remember it so clearly, the day that we wrote his two-word purpose statement, and it was just the coolest thing. All of a sudden, all the craziness of his life, it was redeemed, and it became valuable as opposed to a source of embarrassment or a sense of shame or failure.
It was like, “There’s a reason why I went through being a drunk. There’s a reason why I went through the challenges that I went through in my marriage and my business,” whatever it may be that somebody is facing, that somehow, that purpose statement is a gyroscope that tends to keep us centered. We now know who we are, so we don’t have to spend time either putting on facades or taking them off. If somebody calls you a jerk or cuts you off in traffic, you just look at it and say, “It’s their problem. Okay. I’m not gonna let their issue get in my way.”
The sense of using a two-word purpose statement to really orient one’s life, and then you look at it and say, “Okay, if my purpose statement is liberating greatness...” Ryan, I’ll use you as an example. What’s your dream with the software you’re doing?
Ryan: My dream is to help entrepreneurs maximize all of the hard work and sacrifice in their personal lives that they’ve endured. That’s not a two-word statement.
Kevin: No, no. I was trying to get a sense of what your vision is. Let’s just say yours was liberating greatness.
Kevin: Let’s just borrow that one for you for now. I’m not saying it’s right for you. Then you look at it and say, “I’m trying to liberate the greatness of these entrepreneurs.” This is in my work life, “... these entrepreneurs and all the great things they’ve done that they may or may not even recognize. They may be undervaluing or they may not have the systems, strategies, and structures in place that they need. But if we put those in place, they can experience that greatness. That gives me joy — to liberate their greatness.”
Ryan: Right, to make them happy.
Kevin: To make them happy. Right. Then you also look at liberating greatness. You say, “Okay now.” Ryan — I don’t know —- are you married?
Kevin: How are you liberating greatness in your wife? How are you liberating greatness in your children — if you have them? How are you liberating greatness in a way you invest your money or spend your money? How are you liberating greatness in your own health and well-being? How are you liberating greatness in your intellectual life?
Ryan: It’s not a balance, and it should be, right?
Kevin: No, it’s not a balance. You’re exactly right, it’s not a balance; it’s an integration because balance is a false concept.
Ryan: I like that.
Kevin:What you’re ultimately doing is you’re trying to integrate your life, and your purpose is the point of integration. It’s almost like a prism where you have a white light that shines in to the purpose statement, and out comes that rainbow of colors that you give it expression into these various areas of life. I promise you. I don’t have my act together on this. I’m broken just as much as the next person.
This is not about perfection, it’s about making progress. But what I found is when you have this kind of progress, it’s constantly going on — life is a lot easier. It’s not easy, but it’s easier because you’re not beating yourself up so much, you’re not trying to put on your airs, you’re not trying to pretend to be somebody you aren’t. You can be much more real. Ryan, you’ve got a real, natural, authentic manner about you; it’s probably because you’re comfortable in your own skin. That’s all we’re trying to do — is help people be more comfortable within their skin.
Ryan: Again, the reason I’m doing the podcast is our own hiccups in business and life and challenges that life has brought us. If you’re an entrepreneur — my biggest question, and I’ve asked multiple guests this. I’ve had various responses between just taking time or whatever but I think that’s just not naturally ingrained in entrepreneurs. How do you figure this out without having a tragedy? I just can’t get a real answer behind that, or that’s the only answer.
Kevin: I have actually done this with entrepreneurs from talking to them, and I’ll say to them, “Okay. You’ve called me in. Here’s what I’m doing for you right now. I’m giving you a heart attack. I’m picking up the phone. I’m dialing 9-1-1. The paramedics are gonna be here in two minutes. You are dying on the table. We’re performing CPR on you, and now you have to decide how important is your business.” I’m give people heart attacks — pretend. I’ll say to them, “Now, tell me how important is that business? Do you have time for that appointment that has to be this afternoon? It’s gone because guess what, you’re either dead or you’re in the hospital, but you’re not at that appointment.”
Unless you’re a surgeon where somebody dies, most of our businesses, we overdramatize the …
Ryan: Importance of it.
Kevin:… importance of it. Yeah, we overdramatize the importance of it because to us it’s so important, but it’s no different than when we were a kid and maybe failed a math test in 5 th grade. Who the heck even remembers if I failed a math test in 5th grade, and it was such trauma at that time?
Ryan: Do you think that there’s things that entrepreneurs do to themselves with their business to make the whole business and world revolve around the next crucial decision? How do you free yourself from that golden handcuff or that anxiety that you were talking about?
Kevin: I tend to tell people, “Look at an amortization chart,” because most people understand what an amortization chart is. I’ll say to them, “If you’re in debt to your business,” — I’m not talking about financial debt. “If you feel like you’re caught and trapped, then we’re gonna use an amortization chart-like approach, which is the first mortgage payment you make on an amortization chart, 99.9% of it is interest and 1% is principal. By the time you get to that last payment 20 years, 30 years later depending how long it is, you’re now paying almost all principle, very little interest.”
What we’ve gotta do is we’ve gotta take advantage of that and say, “You would have to go in small incremental steps — if you’re that stuck, if you feel like you’re that caught in that kind of a place.” Most of the time whenever I explain it to people, they say, “I’m don’t have that much time.” I’ll say, “Fine, you can trade off money and put an investment in hiring some talent to help you with some things. You can prepay — pay on some mortgages — double up your mortgage payment, and now we can get you more time because at some level, we’ve gotta have your time put into this.”
It’s interesting. I had dinner last time with a woman who’s got a business — a very small entrepreneur. It was just a favor I was doing for a friend. She could make, in her business, $100 an hour, but she’s spending all of her time doing $25 an hour work. It wasn’t until I pointed it out to her — I said, “At $25 an hour, you can’t even hire somebody to do what you’re doing, so you can’t replace yourself. If you do more of your business, you’re just gonna burn yourself out. We’ve gotta move you to where you can go from $25-an-hour work to $100-an-hour work.”
In much the same way, we entrepreneurs often don’t value our time. If you look at it and say, take the highest price you’ve ever paid for a lawyer per hour — let’s say it’s $400 an hour and say, “I’m the business owner, and I’m hiring this guy, therefore, I’m worth more than that lawyer.” When is my time worth $400 an hour? When is my time worth $500 an hour? When is my time worth $1,000 an hour? That’s where your real value to your company is, and everything else you begin to look at and say, “What else can I delegate?”
Ryan: Yeah, even looking up becomes a challenge if you don’t do that.
Kevin: Correct. It was interesting. I remember, I had somebody say to me - I don’t think I’ll quote it exactly right, but he said, “I would never hire somebody to do work for me at $50 an hour, when I see they’re doing $10 an hour work in their own business.”
Ryan: Interesting. I like that a lot. This ties into at the actual execution of what you’re saying too because the entrepreneurs in the mid-market or the people that listen to this, you just feel like you have to do everything. Every hire, every investment, it comes directly out of your pocket. Right when you feel like you’re kinda turned the corner, you gotta double down and you constantly have to be reinvesting. How do you maybe look at that amortization schedule and say, “Okay. Here’s how I have to balance or integrate my time and the actual work that’s being done.”
Kevin: Yes. What’s cool is I have a term for this. It’s a book that I’m going to write one day. I haven’t written it yet, but my term for it is called hellegation. Hellegation is the state in which an entrepreneur finds him or herself, when they feel like they can’t delegate . They’ve put themselves into hellegation.
Ryan: That’s probably a lot of people that I know. Even if they’ve got a big company and it’s just their executive team that they’re all paying only six figures, and they still can’t figure out how to get that person to do some of the stuff that they’re doing.
Kevin: Again, if you understand you’re in hellegation, that’s the beginning of winning the battle because now you’re looking at: how do I get free from this? But a lot of times, people don’t see themselves — they’re fish in water that don’t understand they’re in water. That water is soiled, and it’s getting worse and worse and worse. They continue to swim faster and faster and faster thinking that somehow it’s gonna get better. It’s just the unfortunate aspect to being an entrepreneur. I suffer from it myself. Again, I don’t hold myself out as the example; I speak from experience here, not from perfection.
Ryan: I don’t think anybody — even the best leaders out there are still constantly battling with themselves every single morning they wake up. I heard this — to go piggyback off of your analogy, I can’t remember who told me, but it was like, “When you figure out that you’re lost in the woods, you have two options. Do you run farther in whatever direction you’re going or do you stop and you actually look up and plan?”
With people understanding that there needs to be a purpose that’s a higher level than just their business — because you know that we’re working — a lot of listeners are dealing with exit plans or action planning, how do you figure out the purpose of who you are in the context of a six-session plan and potential exit plan? I think you’ve worked with individuals in that state. How do you put those two projects together?
Kevin: Generally, we’re hired often as consultants. One of the things that we do is we look at it and say — I’ve gotten very diligent about this (is maybe the best way to describe it), and that is, I’m used to working with CEOs, business owners, and so on and so forth. I’ll sit down, and I’ll say to them, “Look, we’re not doing any of this until you’re on board.” I often get called in by larger companies or somebody who’s maybe a middle manager or a senior in the executive suite or something like that, but the CEO is not bought in. I basically sit there and say, “Look, until your CEO is buying into what we’re about here, we can’t really go forward.”
I often start off with the CEO and then say, “Now let’s work with your team on the personal side.” One of the things that I’m trying to do is basically leadership. I think there’s a real misunderstanding of leadership. As I said, the language of leadership and strategy is misunderstood, therefore people’s lives are misunderstood. Therefore what leadership is is misunderstood, and therefore I’m trying to help people say, “Look, until you understand how your purpose, vision, mission, and values line up in this workplace,” — let’s do it in the workplace — “and why it’s meaningful for you, then it’s not gonna be meaningful for other people that are on your team until you have that.”
We start with the CEO then we look at the team. Again, not everybody is gonna come on board perfectly, and I’m not trying to be dogmatic about it. Different people are gonna have different adoptions and different interests and proclivities for this. Some will, and some won’t. Then you look at the team. We have everything from individual executive coaching to the business consulting to the training and development side with the larger team, so that you can create this alignment of, what I call, the On-Purpose Principle, where the purpose of the person’s one with the purpose of the organization.
Ryan: I love that. In theory, it sounds fantastic. I’m just trying to figure out — the challenge that I see whether it’s the clients who we work with or people that have been on the show who have exited - there’s this challenge. I just think about our old business for an example, where when you have to try and figure out your new purpose, when you’re trying to figure out where you’re gonna go with this business, there’s just so much emotional turmoil going on inside your head because you need to have a plan for the business to exit in some form or fashion, but then you also need to figure out who the heck you are at the same time and find that potential success.
There’s all these different tensions happening, but you don’t really necessarily know which way to go because you don’t know who you are. Going back to that facade that you were talking about, the last thing you wanna do is to expose to everybody going, “I don’t know who the heck I am, and I don’t know where we’re going.” It’s just like all these things happen at once, and there’s just this massive paralysis that I see.
Kevin: Call me.
Ryan:I love it.
Kevin:The bottomline is — I get it. I’ve been there. I understand it. I see it everyday. I get all those things. The real difference is that’s why you go to a tennis pro, or that’s why you go to a golf pro. You’ll say, “Something is not right with my game. I’m not happy with the way that it’s going. How do I fix this?” They look at it, and they go, “Okay.”
When I taught tennis, one of the things I realized is I could look at a tennis player and I could tell you 15 things they were doing wrong. That’s the easy part. The hard part is figuring out what is the one thing that is causing maybe 9 of these 15 problems?
Ryan:The ripple effect. Yeah.
Kevin:You have to really understand the fundamentals of business, the fundamentals of leadership. I don’t understand the fundamentals of their business, perhaps, but I’m smart enough to figure out some of those things and pull it out of them.
When you get to those fundamental things — that one thing that might shift everything — and that’s what purpose does. If there’s a whole bunch of things off that you’re describing, then purpose has the beginnings of righting it, as opposed to continuing to pile on. It’s like building your house on sand versus solid ground.
Ryan: The sand that people are building — the entrepreneurs — the sand that they’re building these houses on is these ridiculous KPIs that they’ve been measuring themselves for decades about revenue or profit margins or orders or order stuffed or packages shipped. They have no idea how to look up and go, “Why am I doing all these stuff?”
I’m in a peer group, and one individual really did a bunch of stuff. He’s like, “Yeah, the packages that shipped are different.” I’m like, “Who cares? Why are you doing all these?” It’s not just to do packaging or t-shirts or whatever it is. It’s just trying to figure out why the heck are you putting all the risk on the line and who are in relationship to what you’re doing?
Kevin: I hear you. It’s the sort of thing where — I have a thing, from the Chief Leadership Officer book that I’ve got — there’s a thing in there called the CLO Integrity Map. The integrity map starts with purpose, vision, mission, and values that goes to the strategic story. It goes to the business planning, communications plan, then it branches off to — if you think of it as an income statement, to the sales and marketing side then it goes into the operations and culture side, then they reconnect to create that user experience.
What’s going on is until people have a map — if you’re lost in the woods like you’re describing, yes you gotta look up, but ideally, you’ll pull a map out from the back of your pocket and say, “Okay, I think I’m here. How do I get from here to there?” You try it. Again, because we’re working with middle market companies so often, what I found is you have to move fast with them. They don’t have time to focus on it; you have to find them the time.
Because we know what we’re doing, we’re good at what we’re doing, we have the tools, technologies, and methods — we’re able to come alongside of them and say, “Look, we’re gonna sit down and spend an hour with you, and we’re gonna come back. We’re gonna have this, this, and this.” Again, it’s a type of talent because a lot of these things that we’re doing are one-time events.
In fact it’s kind of interesting. I’m doing some work this Friday with a client of mine that we did purpose, vision, mission, and values in 2004.
The CEO called me up recently and said, “Kevin, we’ve lost focus. I need you to come back because the last time you were here, we went from 25 million to 75 million.”
Ryan:Wow. Holy cow.
Kevin:“Now we’re back down in the $30 to $35 million range. Recession had something to do with that, but why haven’t we recovered back up to that $50 to $75 million range?” He said, “We have lost our focus. I need your help.” Those are the things where it’s an investment that one just has to decide in and make going forward.
Ryan: As we’re winding down here, explain the Chief Leadership Officer for us a little bit more because I know you got that book. You’ve got also a couple of other books that I’m gonna put in the show notes, but I think that is one of the cooler titles because that’s what Tania had reached out to you for. Explain what is your definition of that.
Kevin: A Chief Leadership Officer is the next generation of what CEOs need to become. CEOs as a title and as a function are obsolete; they’re based on the Industrial Age. They came out of the latter years of the Industrial Revolution and the Industrial Age. We’re now in the Digital Age, and the age beyond the Information Age is the Age of Purpose and Meaning. It’s where we’re headed. A lot of the millennials — they talk about they want meaning in everything. Everybody has always wanted meaning. They just happen to be at the right place, at the right time where society can afford to have people pursue meaning.
I’m a baby boomer, and I’m telling you the same thing. The great generation, they had — their purpose was fighting a World War II is a thing that they were able to buy into, which was a big activity that was very meaningful. In many ways, what we’re trying to do is say, “Look, there’s a new leadership style that needs to emerge.” The old-school — the corner office has been the last place of innovation. They want everybody else to innovate, except themselves
What I’m saying to the CEOs is, “Folks, it’s time somebody got in your face and said to you, ‘You’re the problem. It’s your old-school methods, thinking, and style which are causing all of these problems. It’s why you have dissatisfaction. It’s why you have people problems. It’s why you have the chaos you’re in. It’s because you’re doing business incompletely right. You’re doing a lot of things right but you’re still doing business incompletely right.’”
Ryan: Is it the purpose that you’ve been talking about that they’re missing? What are some of the main key characteristics that they’re missing?
Kevin: It starts with purpose. The problem is most people talk about purpose, but they don’t have a system to build it into their organization. What they do is they run their organization, exactly what you’re calling, on the KPIs. They run it on numbers, financial statements, and KPIs, and/or power — an organizational chart - but they don’t have a systematic way to put purpose, which is why they’re in business to begin with into their business. That’s what the CLO Integrity Map does — is it gives them a map to say, “You start with purpose, and you end up all the way to customer experience.”
Ryan: That’s awesome. What happens if you’re the CEO that is not capable of doing something like that?
Kevin: Call me. What we’re doing is we’re in a process of training people to do all of these, and we’re trying to get it up. Read the book. I don’t expect people to be capable of it because we have an entire generations of generations that have been raised in the old-school way. Part of what I’m trying to do is — I know that I’m putting a stake in the ground 5 years from now, maybe 10 years from now, saying, “Look, in the future, people who run businesses are gonna be CLOs, not CEOs.” But for now, we’re on a transitional period. I don’t have all the answers. I have a methodology, I have a map, I have tools, I have training, I have all sorts of things that are there, but it’s still in its infancy.
Ryan: Just look at what’s going on with all the news. You got Travis from Uber, who got ousted. I don’t care whether you’re a multibillion-dollar company or you’re just on the technical side of The E-Myth. Everything is a commodity these days, so you have to have some passion or purpose to attract other people that are gonna help change you and your customers. I don’t know how else you could differentiate yourself.
Kevin: I would agree. It’s very difficult, otherwise you are just a series of computers talking to other computers, and there’s no heart and soul to your business.
Ryan: To leave us a pretty cool story — do you have a really good example of someone that has implemented a combination maybe with the CLO or the On-Purpose that really came out from being stuck to changing them and their company?
Kevin: Yes. I have a client of mine that’s out in California. This was a few years back. It is a family-owned business; it’s been around for 50 years. When they called me, for the last 10 years, they had not made any money. They would have $100,000 profit; they’d lose $200,000. They were doing 17 million in revenue. I came out with them, did a purpose, vision, mission, and values session with them, as well as then an overall assessment of their business and their strategy — discovered some things that they could do better — is maybe the better way to describe it.
We did some training with their people, and they had 100 and some employees. We began to teach purpose, vision, mission, and values throughout the whole company. Nine months later, I was in California on a different business trip, and I swung by to see them just to see how things were going. The guy said to me, “You know what? This year, we’re on track to make $2 million. Same amount of money, same amount of sales, but we’re gonna make $2 million.” He said, “All we did was implement what you told us, and it has made such a difference.”
The next year, they went to $21 million, and they went $24 million. The last time I talked to them, they were at $45 million in revenues. They’d hired a CEO, the business was making money, they’d built another manufacturing facility. It was just a matter of making the shift to what was going on and deciding that this was a priority — that the well-being of their life, that’s really what it comes down to. You keep asking me, “How do you find time? How do you find time?” You have to decide that the well-being of my life and my business and the people that I have stewardship and leadership of — that they are more important — if they’re doing well then the business is going to do well. It’s an attitude shift.
Ryan: That’s gotta be so rewarding. I’m just totally visualizing some make-believe scenario, but you interacting with them. You can see the sparkle on their face versus the dread.
Ryan:Facial expression — aside from all the amazing financial growth — just the actual change in the demeanor has gotta be just rewarding as all beyond.
Kevin: The other part of it that was interesting is I actually helped all — there were three brothers that owned this business, and I was able to help all three brothers define what they did best. The subtitle to the On-Purpose Business Person is “Doing more of what you do best more profitably.” What’s happening is most people are not doing more of what they do best more profitably. They are wasting their time away doing less profitable things, not doing what they do best. For them, once I was able to get them personally aligned, then we could align the business, then we could complement them.
Strategically, we’re able to take the purpose, vision, mission, and values, then say, “How do they fit in? Then where do they not fit in, and who on the team can fit in around them? Or can we delegate, outsource, hire — whatever we need to do to make it all work?”
Ryan: I love it. I absolutely love it. If there’s one thing, Kevin, that you’d highlight or reiterate to our listeners, what would it be?
Kevin: Know your two-word purpose.
Ryan: You’ve got a website coming out that we’re gonna link to, that will help our listeners actually go in there and do an exercise for that. I don’t know if you wanna explain that a little bit?
Kevin: Sure. Just a real quick version of it. The website it onpurpose.me. What will happen is you go there — it’s five bucks. You sign up. You get a little video or a little message that talks about purpose and why it’s important, and then you go to a tool that helps you write and decide what your two-word purpose statement is. Then after that, you get 10 emails that explain how to be On-Purpose with it. It’s something that I help people use with their employees. Part of what I’m trying to do is eradicate meaninglessness from the planet.
Ryan:I like that.
Kevin:This is part of what I’m trying to do — make it so affordable that anybody can do it.
Ryan: I love it. Aside from that website, what’s the best way for our listeners to get in touch with you?
Kevin: Generally through our website which is onpurpose.com. With or without the hyphen, you can get through there. You can email me. You can put that in the notes as well. If people wanna email me and get in touch, we’re happy to connect up with them.
Ryan: Thank you so much for coming on the show. I had a blast.
Kevin: Ryan, it was just great to visit with you and [Georgia 0:51:27] as well. Thank you.
Ryan: I hope you enjoyed the episode with Kevin. I know it’s a little bit more of a “mushy topic,” however, being on purpose, I think, in your business and your life is unbelievably important because everything trickles down from there. How you treat your employees, how you treat your vendors, where you’re going with your vision, and being able to put all of the decisions that you have to make as an entrepreneur in line, into a greater road map for the vision of where your purpose is — I think is so important because otherwise you’re gonna end up being reactionary to all the decisions that you have to make along the way and not knowing how to benchmark whether those fit into your purpose-driven life or your business is very difficult without that roadmap.
My three main takeaways from my conversation with Kevin are — the number one thing is the fear of exposure. Just from my own experience, when we are running Imaging Path or even now at Solidity, you have to have it all figured out, so you think, and everybody looks at you like you’re supposed to have it all figured out. But I think knowing your purpose and knowing where you wanna go is much easier to show everybody that you don’t have it all figured out because then you’re gonna actually be able to sit down and be transparent and be real and authentic with your employees, with your vendors, with your family members.
Just really accepting the fact that you don’t have it all figured out, but knowing that you got assurance that you’re going in the right direction, that feels good, and that aligns with your morals and values is huge.
The second main takeaway I had, which I really enjoyed — I don’t know if I’ve ever really heard it phrased the way he did, but it was the “balance versus integration.” I think as entrepreneurs, I’m more than guilty of it is — you try to have this balance where all of a sudden you go home. For me, I’ve got the young twins at home — is just to shut it all off, and “now I’m supposed to be present.” But having an integration with everything, like the prism he was talking about - because you can’t just shut things on and off — but making sure that it all weaves in and out seamlessly, so it feels comfortable is huge. I think it has to do with understanding why you’re doing everything, and back to that Simon Sinek where if you know why you’re doing it, you’ve got a purpose then you can integrate your purpose and your business why all together, instead of having these very hard on-and-off switches that I find difficult to actually accomplish.
The third one that I loved is how he termed hellegation. It’s the state of not being able to delegate. I don’t know if anybody caught that, but I think a lot of entrepreneurs that I worked with — I’ve been guilty of it. I know some of our old employees were guilty of it, where you think you have to do everything, and so you’re stuck in this hell hole where you can delegate but you don’t have enough time to do it. Really realizing what’s important, and you might have to sacrifice some profitability or that lost customer because you’re teaching other people how to do it is huge. Getting out of that and being able to delegate and doing what it takes to delegate so you can win back your time and freedom from your business.
With that been said, I hope you enjoyed this episode. I’ll see you next week.