In this clarifying episode, Lee Benson, CEO of Execute to Win, takes aim at two enormous problems founders face (especially when they hire coaches or consultants).
You will discover:
– A clear definition of success for every CEO
– Why traditional strategic planning never works sustainably (leading to Treadmill)
– Why your operating system, no matter what it’s called or how much you love it, will grow your business (and what will)
Episode Transcript
Scott Ritzheimer
Hello, hello and welcome. Welcome once again to the secrets of the high demand coach podcast. And here with us today is yet another high demand coach in the one and only Lee Benson, who’s a value creation expert and CEO of execute to win a firm that helps organizations of all sizes to accelerate the value they create. He has founded and led seven companies, including able aerospace, which he grew from two to 500 employees and a nine figure exit in 2016 He’s also the author of the book your most important number. He’s here with us today. Lee, welcome to the show. So excited to have you here. And I have to admit you had me from the title. What is my most important number?
Lee Benson
Yeah, well, good to be here, Scott, thanks for having me and your most important number. It really kind of changes throughout the organization, at the top of the organization, what’s the one number that’s reflective of the value of the business and will drive the majority the right behaviors with the senior leadership team? So I believe every CEO’s job, every founder’s job, is to continually and responsibly increase the value of their business. Now, as you cascade out from that, you’ve got marketing and sales and operations and finance, HR, whatever that is, they have a most important number that’s reflective of the value that that function was designed to create, or should have been designed to create, and will drive the majority the right behavior. So this can be one number in a small team. It can be 10 different teams with different most important numbers all the way to 1000s of teams and and when one improves, it accretes up all the way to the top of the organization, thereby increasing the value of the business.
Scott Ritzheimer
Yeah, yeah. I love that. So you’ve used the word value several times, and I’m actually surprised at how infrequently this idea of value comes up. And there’s a couple key ways there’s, you know, there’s value to all different stakeholders, but when it comes to the most important number, are you referring to value that the business creates, namely, on behalf of it, or on behalf of or for its customers, or are you talking about the business, the value of the business itself?
Lee Benson
Well, if you increase the value of the business, you have to be increasing the value for your customers, right? And so what do the customers really say about the quality or value or the experience they have when they buy your products and services, and it’s not just your product and service, it’s also the team and your team and how they interact with your customers. So all of that actually goes into it. So I would say, if you’re continually, and I love, you know, thinking about this way, responsibly, increasing the value of your business over time, just consistently, year after year you have to be doing those other things as well.
Scott Ritzheimer
Yeah, I love that, that idea of responsibility, it can rub folks a little the wrong way sometimes, but I think it is the link if you don’t do it responsible, because lots of folks can, like, flip stuff. I remember, I think it was horse Schultz talking about, anyone can go in and make a hotel more profitable, but can you make it better? Right? It’s just a great saying and and so I love that idea of continual and responsible, and then those two values come together in time. So another thing jumped out in me the book. Jumped out at me in the book was this idea of a leadership Audit Checklist, and just what it did for you guys. So I’m wondering if you could just just kind of enlighten us what was in the leadership checklist, or, sorry, leadership Audit Checklist, and why did it make such a big difference for you?
Lee Benson
Yeah, well, I think for all of us, and I’ve actually started from scratch eight companies, ranging from, you know, 10 team members to over 500 team members in each and in the bigger ones. It’s interesting looking at the leaders, going, Gosh, some of those leaders are getting amazing results consistently, and others not so much, like you have the whole spectrum there. So what’s different in their approach and so well, how they show up as a leader matters. Their management operating system, where I would say rituals they consistently do to cause great results to happen, matters. That’s the second category. And then third, I called it foundational readiness, which is essentially, are you ready to grow at any point in time? And every business is different, but in my in the aerospace example that’s coming from the book, 20% was what I had put out there. At any point in time, it’d be ready to grow 20% right? Oh, how you show up? What are the things you do to consistently get really great results? You know, meetings, KPIs, you know, all those things that you do. And then are you ready to grow? And lo and behold, once I put that in place, I went from, you know, when you look at the checklist, there’s three categories, and then there’s subcategories in each one of those. And I would just say red, green or yellow for every leader. Once I posted it, initially, there were a few leaders that were green, almost across the board. There were a few that read across the board, some that were, you know, yellow and green. Within 90 days, almost everybody was mostly green. Across the board, because we were running about what we wanted leaders to do, and lo and behold, we just kept growing faster. No, no surprise whatsoever, right?
Scott Ritzheimer
Yeah, it’s so good. It’s so good. So that folks know kind of what we’re dealing with here. This isn’t like just some novel thing that you thought of one time. This is real world stuff. So Jack Welch told you that that yours was one of the best business management operating systems he’d ever seen. And had he used it one running GE, their results would have been exponentially better. That’s remarkable. My question for you, kind of stemming off of this, is, what makes one operating system better than another?
Lee Benson
So I would that’s a great question. So there’s, there’s two parts of it. There’s the operating system and your approach, attitudes, beliefs, behaviors, around how you apply it. So on the on the first part of that question for an operating system, I think simple is better. So how can you distill it down? Make it so easy to understand, get everybody aligned around, you know, creating value that way. And there are a whole bunch of operating systems that are pretty complex and and then the the approaches to applying it, they make the process what’s most important, not creating value, right? So that’s why I came up with your most important number. I call it the mind management system. And in there you’ve got the most important number, the top of the organization. Every team that feeds up into it, all the way to the front lines, they have their most important number, and then they they call out the best work they can do to continually improve that that is so simple, so easy. Included in the mind management system is everything else, strategy, compensation, just everything is in there, but the simple structure of it, wildly, wildly easy. Now, when you know, kind of, getting back to the how you apply it, how you think about it, right, we would all be shooting towards, you know, having a culture that’s all about creating value. Connect culture to value creation. So everything we do is done with the intent of making the organization measurably better, more valuable over time. That’s where most trip up with operating systems. Yes, I think, I think any operating system out there, if you’re doing something to intentionally improve or increase the value of the business, you can’t help but get a little better. Be careful what you choose, because if it’s overly complex, it’s really hard to keep that going over the long run. And and what I believe, and I’ve seen this over and over again, working with lots of companies, 1000s of leaders, traditional goal setting I’ve never seen stand the test of time ever. And Well, when I when I go in and audit a business, and I’m just looking, show me all the goals, what you’re setting, show me your strategy, how it trickles out, and I look at the goals, less than 10% of them are thoughtful goals that would really move the needle, and in the process, just feels terrible for most of our team members, because, hey, set three goals every quarter, for example, get it approved by your manager, rinse and repeat every quarter. It feels terrible how and then you switch over to the my management system as an example, here’s the most important number for the team. This is where we started. This is where we’re going. But any point in time we can see if we’re on track, and I was like playing a baseball game, we know whether we’re winning or losing. This is my position, and this is the best work I’ve been called to do to help contribute to improving that. Yeah, now it’s super easy, and you can cascade it, but it what you asked is such a big question that impacts everybody, whether using OKRs, 40x Eos, scaling up, there’s so many systems out there, I am super biased towards what I’ve created over decades and working with hundreds of companies, because it’s simple and you don’t have to change your language inside the business like you have to with all the others.
Scott Ritzheimer
Yeah, I could get myself in a lot of trouble if we go down that road. I couldn’t agree more. I you know, one of the things that that really gets me about a lot of those systems, particularly for the practitioners of those systems, is that the system becomes more important than whatever the system’s there for in the first place, and, and, and so the systems are all great. There’s nothing inherently wrong with them. We’re like, fundamentally flawed. There’s something wrong with all of them. I forget who it was. It said, all models are wrong. Some are useful, but so they’re not fundamentally flawed, but when we drink the Kool Aid for them, that’s when we get in trouble. And actually leads me to a similar point. Because one of the reasons why that happens, and I this is a temptation for me, with the model that we use is the when I used the model to create value in my business, the one we use now, the predictable success model, it had a massive transformative impact on our business. And it’s like I want so badly for folks to have that. And one of the challenges with that is not every situation is the same. Right? And a lot of times on the the client side of the coaching equation, they’re going out and looking for someone who’s done what they want to do right in some way, shape or form, and they think that’s what will make them an expert at helping me out. And then on the coach side, we kind of think, well, I’ve done this before. I can tell everybody how to do it, you know, they just need to do it like me. But you, you came to a different revelate revelation that the initial kind of systems that you used were too complex or too rigorous, I would say, not too complex, but too rigorous for a lot of folks to execute on. Well, and you really dug in over the years to find one that actually everybody can use. Why is that so important?
Lee Benson
100% and to your point, businesses are different, you know, small, nuanced difference to significantly different. One size does not fit all, except with what the, you know, the direction that we went. What’s the value of your business? I can look at every for profit business, and there’s going to be a value. Your job is to continually grow. It great. Let’s figure out what that is. That’s the senior leadership team’s most important number. Yeah, cascade that out and go. That’s why I did it. And I was the kind of leader when I had the aerospace company 500 employees. Now, there were lots of ups and downs in the early years. I mean, all the uphill in the snow, both ways. Stories I can, I can give you, but, but in running that I early on, I was able up to a couple 100 employees to make traditional goal setting work. It was a Herculean effort, but backed off for a second. It went away. They would start backing off, yeah, so on. It to come up with something that worked really across the board, and I think really importantly, we didn’t have to change the language, whatever we called it, we would just do it and and then I read a book, because we were in the aviation aftermarket business. We repaired, overhaul, manufactured aircraft parts. We had 2000 customers in 60 countries, incredible operations. We did 95% of everything. And I was just incredibly complex. This book was called Lean MRO, maintenance, repair and overhaul. And there was this. There was a line in there. It said, the most elegant solution is on the other side of complexity. It’s simplicity on the other side of complexity. Yeah. So when you cookie cutter, apply an operating system, whatever it is, to what you have, you’re probably going to fail or definitely not get the results you want. But if you really understand, as you’re applying this thing to all the complexity of your organization, you come up with a really simple, elegant solution on the other side of that, that’s where you win, literally 95 plus percent of the time. Does that makes sense?
Scott Ritzheimer
It does? It really, really does. And and again, I like that language of simplicity versus elegance. And I forget who it was actually from the Aviation space. It’s just driving me crazy. But they talked about elegance and design as being the point at which you can take nothing else away, right? Which is so different than the way that we think about it, right? We think about, what do I have to add? What can we do more? And it’s plus, plus plus multiple, multiple, multiple, instead of that taking away, that refining and that focusing, that I think you guys have been able to achieve so effectively through, well, through your operating system.
Lee Benson
And think about it this way, most would say we want to improve quality is going to cost a whole bunch more, and you have to do all these things. Well, how can we improve quality while we’re reducing costs? Yeah, and that is it. I mean that that’s that’s directionally, where we should go, lower it, you know, improve quality of product and service experience for all team members, all stakeholders, at a lowering relative cost over time. That’s how we know we’re doing the right work.
Scott Ritzheimer
Yeah, one of the other challenges with what you’ve called traditional goal setting, and I see this a lot, particularly in established leadership teams, there’s just so many things fighting for your attention. There’s so many strengths, there’s so many weaknesses, opportunities, threats, or whatever tool you’re using, right? Like, there’s just so many things, and it can almost be debilitating. Like, what do we actually need to do next. How do you help teams answer that question?
Lee Benson
Yeah, well, one of my maxims is, do less better. And every company that I’ve worked with, whether it’s a startup all the way to $60 billion plus market cap organizations, I’ve never found one that has more than about four things that create 80 to 90% of the value for the organization. So I always want to look at that and say, Well, how well are we doing those four things? And on a scale from one to 10, if it’s not an eight, nine or 10 in each one of them, why are we doing anything else? And so I always ask the question, Well, why don’t we improve those things? Well, because it’s hard, like we’ve got it to this place, and if you want to keep moving the needle there, pushing the bar, it’s actually hard work to do, but it should be fun. So focus there. Do you know, do less better, and it’s amazing how much faster organizations go. There’s no magic pill, there’s no silver bullet. We actually have to do something, even though we’re kind of. A culture in United States right now where people just want it without having to do anything. Sorry, you have to do something. And you know what? It can be fun. And what I found, when you get the team right, you get the culture right, you’re doing the right work. The harder it gets, the harder we laugh. That’s how we know we’re doing the right work.
Scott Ritzheimer
That’s so good. Why is it that doing less better is so much less appealing than adding more like not that it isn’t. But why does it feel that way?
Lee Benson
Well, I think there’s a couple of things going on. I believe you have to be passionate about strategy and equally passionate about executing and and you can be out of balance, really, on both of them. And most business leaders that I run into, they want to intellectualize about all these things that you could do on paper and write it all down. And how amazing is this? And they walk away from a strategy session that was so great now we’ve solved all the problems. And like I say in the book, you have a strategy. Congratulations. You’re 3% of the way there. 97% is going to be actually doing it. And the better you get at actually doing it, the better you’ll get a strategy, because you come up with things that will really accelerate the value that your organization creates. So yeah, I think that’s one piece of it, and it’s just hard. They’re not. A lot of folks just aren’t leaning in to really improve. And a lot of times they don’t even, they don’t even know where to improve. They’re doing stuff, and they can all be great things, your leaders in an organization, but they’re not in alignment. And you know, one of the most valuable things that I think I could probably communicate here to all the listeners is something I call value creation nudging. And in chapter eight, I just updated the book with a chapter eight. It’s titled, you know why sometimes CEOs fail? And the subtitle is, does your team really understand? I find very few organizations where all the leaders understand the business model, like, can you can explain it to me? And there’s, there’s a number of founders and CEOs that can’t do a very good job explaining it. So when you’re in meetings and people are talking about doing things that just don’t make sense and frustrate you, a lot of times, you know, they want to win, like very few want the company to intentionally fail. A lot of times, they don’t really understand the business model. So how can they make decisions in alignment with it? Or they don’t understand the strategic initiatives, or they don’t really understand what customers say and feel about our products and services, and they don’t understand the intentional culture around beliefs, behaviors, traits, other things that cause extraordinary value to be created if they understood those four things in their bones, the business model, your strategy, the value of your stuff as seen by customers, and your value creating culture, all of a sudden they’ll start making better decisions, and you’ll get less frustrated. So yeah, I my nugget here is, I call it value creation, nudging. And every time you’re in a meeting and something isn’t in alignment with what you know it should be. It probably has something to do with those four areas. I’ve never seen it. I’d have something to do with it. Does that make sense, Scott?
Scott Ritzheimer
It’s so so good. And I love the simplicity of that, the business model, your strategy, how you create value for your customers, and a culture that delivers on that so true. So I’m wondering, I don’t know how you top that. Lee, so your job’s a lot harder than mine right now. But what would you say as a question I ask all my guests, I’m interested to see what you have to say to it. So in addition to what you’ve shared with us so far, what would you say is the biggest secret that you wish wasn’t a secret at all? What’s that one thing you wish everybody watching or listening today knew?
Lee Benson
Yeah, so I gave you one of my maxims around, do less better. I have another t shirt. I can get you one if you want. It says, struggle better. And so the value of struggle, you know, we as parents, you know, a lot of parents with great intentions have taken so much struggle away from kids. They’re not even close to ready to being an adult, oh my gosh. So we really messed up in developing for that and that. Now I see adults in the workplace and leaders. Something doesn’t lay out perfectly, and they act like victims, like, oh my gosh, there’s so much value and struggle. Like, every time it gets really hard, I’m finally at a point at 63 where I get this warm feeling inside. This is going to be amazing when I come out the other side. So the understanding there’s so much value and struggle, lean into it every single day, get comfortable with it and increase your tolerance for it, and you’ll create so much more value.
Scott Ritzheimer
Yeah, I have found that for the vast majority of folks, the future is much better than they really believe, but the path to get there is going to be a lot harder than they would like to know, you know, and it’s that same thing, it’s going to be so much better on the other side, and when we can recognize that what we have to do to get there, yeah, you have to do it, but it’s not that big a deal. Pales in comparison to the joy that’s. In front of us. So I love that idea. Struggle better. So Lee, there’s there’s folks listening to this and like we’ve just ticked the we’ve nicked the surface. We’ve not even begun to dug in. How can they find more out about the operating system that you’ve put together? Where can they get a copy of their book or find more out about you?
Lee Benson
Yeah, please go to our website, which is etw.com you can get the book there, or you can find it on Amazon or 40,000 other channels out there. There’s the written version of it, there’s an audio version of it. And on the website, if you want, you can actually DIY the last section of the book is a do it yourself section, and you can get on, and it’s like 12 bucks a seat, if you had one person in a company, 12 bucks. And you can have the software to do this, the courses in there, all the resources, everything included with us. We make it super easy. If you want to implement the mind management system, and we have the leadership value lab, you can sign up for that, and it’s just ongoing leadership lessons that come out daily, weekly, monthly.
Scott Ritzheimer
Fantastic. Lee, excellent, excellent wisdom. I love the maxims, the T shirts, the whole nine yards. There’s just so much good stuff in there. Thank you for being on the show. I really appreciate you sharing with us here today. And for those of you watching and listening, you know your time and attention mean the world to us, I hope you got as much out of this conversation as I know I did, and I cannot wait to see you next time. Take care.
Contact Lee Benson
Lee Benson is a value creation expert and CEO of Execute to Win, a firm that helps organizations of all sizes to accelerate the value they create. He founded and led seven companies, including Able Aerospace, which grew from 2 to 500 employees and a 9-figure exit in 2016. He is also a 2x Wall Street Journal bestselling author of Your Most Important Number and Value Creation Kid, which helps parents teach their kids about money and value-creation tactics.
Want to learn more about Lee Benson’s work at Execute to Win? Check out his website at https://etw.com/
Podcast Booking Status: Open
We are looking for podcast guests, and we want to share your story.
Are you a coach, consultant, or advisor for entrepreneurial organizations? If so, let’s do a great show together – and we can promote you to our audience on all our social media channels, website, and email list.