The Road Less Stupid

The Road Less Stupid by Keith J. Cunningham argues the best way to succeed is to avoid mistakes.

He is an avid believer in thinking time and he treats business as an intellectual sport.

I’ve known Keith and his materials for a long time. However every time I read this book I learn something new. Keith is one of the greats.

The three most fundamental questions to ask to help get clarity about the root problem/obstacle are: What are the possible reasons I am noticing this symptom? What isn’t happening that, if it did happen, would cause the perceived gap (symptoms) to either narrow or disappear? What is happening that, if it stopped happening, would cause the perceived gap (symptoms) to narrow or disappear?

What is the upside? We are usually experts at this one. What is the downside? What could go wrong? We rarely can do this one by ourselves because we are irrationally emotional and optimistic about the thing we are deciding about. Can I live with the downside? Only the pros bother to think about this one, which is why their track record of dumb tax is so much smaller than the track record of the rest of us mortals.

Thinking Time Where are we compromising by looking for the door marked “WOW!”? What shortcuts are we attempting to take that are not really shortcuts but rather mirages of greed, laziness, or impatience? What skills do I need to master to attain the success I want? Realistically, how much additional

time and practice are required for me to attain my outcomes? Who can I hire as a coach or mentor to help guide me and hold me accountable? Where do I need to practice to improve my game and thus deserve the success I want? Where do we need to pick up the level of intensity in how we are playing this game?

After a certain amount of time, size, and momentum, more passion and enhanced professional skills are not the primary drivers of growth and sustainable business success.

Artistic success requires refinement of creative and artistic talent. Operational competence requires honing professional and technical skills. Business success requires mastery of business skills and tools.

As a business grows (gets traction and scales), the additional skills required to evaluate and seize new opportunities, create enterprise value, and sustain momentum are all business-related: for example, managing cash flow, hiring the talent, reading financial statements, creating a culture, refining the target market, designing the messaging, leveraging other people, delegating tasks, allocating resources, prioritizing, strategizing, creating dashboards, and measuring outcomes.

Few things are more common than unrewarded artistic and technical expertise.

Look no further than boxer Mike Tyson, rapper 50 Cent, MLB pitcher Curt Schilling, or movie director Francis Ford Coppola. All were artistic and technical legends and all made a fortune with their unique skill and artistry. But, all went broke financially.

Bill Gates has quipped, “The problem with success is that it lulls smart people into believing they…

In the world of business success, four primary roles must be performed: Artist (Creator); Operator (Technician); Owner (…

The primary crisis of most start-ups and small businesses is usually cash, traction, or operational structure, any one of which causes the Owner (Business)…

Think of each role as a different hat that must be worn, depending on what the business needs. When you add each hat to your wardrobe, it allows you to think about your business in different ways at different times. Sometimes you will need to create. At other times you must think in terms of risks or sales or dashboards. Wearing an Owner hat while in a creation mode or wearing an Artist hat while trying to assess the risks results in misguided and expensive mistakes. Having a hat for each…

Don’t confuse these hats with your identity, though. They do not define who you are or what you are capable of doing, which means you are not stuck. No one “is” an Artist, but lots of people have significant artistic strengths. Having artistic talent is not mutually exclusive with learning how to read a balance sheet or delegating to your team any more…

These hats are interchangeable at will. But each hat requires a different mindset and skill set,…

If you want business success, then learn the necessary business skills and tools.) There is no…

Artist (Creator) An Artist is highly creative. Artists love their…

They live to create art and find producing it highly energizing. Most artists would love to commercialize their work product and have millions of customers applauding its creativity and beauty, but they make the faulty assumption that the key to more applause and higher sales is tweaking the product. In…

If McDonald’s was run by an Artist, the management team would spend the majority of their time trying to create a healthier and better tasting cheeseburger. (Clearly, the McDonald’s Artist hat was abandoned years ago.) On the other hand, Steve Jobs was a full-blown Artist during his first tenure with Apple . . . and it almost destroyed the company. (It got so bad they had to get an investment from his nemesis, Bill Gates.) After his reinstatement as CEO twelve years later, Steve tempered his artistic flair with some business and risk assessment acumen (Board hat), which allowed him…

Operator (Technician) An Operator is a great Technician who adds value through time and effort. Operators focus on getting it done. The erroneous belief is that the…

For all their initial optimism and grand plans for global domination, the bulk of all operators find themselves in a defensive mode, reacting to the problem du jour. New ideas and opportunities are difficult…

The Operator is not running the business; the business…

An Owner is engaged and involved in the planning, execution, measurement, and corrections necessary to proactively lead and…

Owners add value primarily through leverage (team) and measurement (dashboards…

A great Owner runs the business end of the business by measuring results and then either fertilizes the activities that produced the good results or changes the activities that caused the bad ones.

Owners know and use all the levers in the business cockpit—particularly the financial statements, dashboards, and metrics of the business—to help them make great decisions.

Board (Investor) A valuable Board of Directors uses the same skill sets and brain cells as a great Investor does. The key attributes of both are the abilities to question, probe, think sequentially, substitute rational thought for emotion,…

Unlike the other three hats, which are focused on the “doing” part of business, the Board (Investor) hat is a way of thinking. This is the hat that all owners must have and use because it minimizes the likelihood of an…

The problem is that diagnosing your own disease, correcting your own golf swing, or defending yourself in a courtroom are impossible to do well; there’s too much emotion, not enough perspective. Doctors seek…

Attorneys who find themselves on the wrong end of the legal system will hire a defense lawyer to represent them in a trial. A Board of Directors serves…

How members of the Board think and what they think about is something every CEO/Owner should emulate, whether or not they have a formal Board. The vast majority of large, successful companies…

The single best business decision you will ever make is to intentionally work with a peer group on a regular basis to question assumptions, ask hard questions (the kind you hope nobody will ask), alert you to…

While an Artist is “creating” it, an Operator is “doing” it; an Owner is “leading, structuring, and leveraging” it; and the Board is…

A Board knows that business is an intellectual sport and that championship teams always have a world-class defense. Therefore, a thoughtful, measured approach to decision making, risks, priorities, allocation of assets, assumptions, and 2nd-order consequences (What Don’t I See?…

Thinking Time If my business could talk, what would it say? Which hat has been my comfort zone and which hats are not getting worn often enough? For that matter, which hats do I not even own, and how can I acquire them? What, specifically, have I been ignoring about my business, and what specifically needs to be corrected? What skills or tools do I need to learn (or who do I need to hire) to help me overcome the obvious obstacles that are restricting my growth, sales, and profitability? What areas of my business could be delegated (or outsourced) to someone else (who is competent and has execution intelligence) to free me up to do the things that would add the most value? Artist Hat: What needs to be created? Operator Hat: What needs to be done . . . today? Owner Hat: What needs to be structured?…

Artist Hat: What needs to be created? Operator Hat: What needs to be done . . . today? Owner Hat: What needs to be structured? Measured? Planned? Delegated? Board Hat: What could go wrong? How can I mitigate the probability of that risk occurring and, if it does occur, reduce the cost?

Thinking Time What is the culture we have now? (Make a list of how people act and treat each other . . . both good and bad.) What is the culture we want to create? (Make a list.) If this were the worst, most toxic place on the planet to work, what would the culture look like? (Make a list so you can start thinking about the opposites.) What would the culture look like if we were to become the “employer of choice”? What are the culture deficiencies in our business that are preventing us from being high-performance vs. high-maintenance? What are the beliefs employees must have that have led to the culture we now have? What are the new beliefs employees must have to construct our new vision of how we treat each other and work together? What are the specific rituals we can create which will help reinforce and memorialize our new culture? What are the difficult conversations I need to have to reset our culture and create a high-performance team? What are the simple rules of the game we must adopt to create a culture in which our people are truly engaged, committed to excellence, and do their best work? NOW . . . Go Think! You will thank me later. KJC

How do I need to rework our plans and budgets to make them granular and measurable? What is the specific recipe I need to create to make certain the outcome we have stated is achieved? What are the specific activities and milestones we must hit in order to stay on track with our stated deliverables? Who, specifically, is accountable and responsible for achieving each outcome? What are the dashboards I need to create to make sure we are measuring the critical drivers and making corrections based on our performance?

Thinking Time In light of the seven fundamental jobs of a CEO, where have I dropped the ball and what do I need to do differently to cause us to get better? (Nothing changes if nothing changes.) As I am thinking about the next 100 days and what I will do differently, what are the things I must do less of to make room for the things I need to do more of? If my team represents my leverage, what do I need to do or say to ensure their success? Starting and perfection are rarely simultaneous. What are the three things I could begin doing that would get me 80% of the way there? What is the discipline I need to adopt to create the outcomes I want? What is my specific measurable plan to improve our results? Where have I abdicated my responsibilities as a CEO and what do I need to do about it? Where have I optimized for easy instead of outcomes? NOW . . . Go Think! You will thank me later. KJC

As I look back at my most significant losses, stupidest decisions, and biggest mistakes, what are the fifty most important lessons I have learned? Where am I making some of these same mistakes again? Based on prior lessons learned, what do I need to change (immediately) to avoid the dreaded dumb tax? What are the rules and disciplines I will put in place to minimize the likelihood of repeating my mistakes?

Trying to figure out how to immediately solve a problem in one fell swoop is stupid. I might not have the final “Holy Grail” solution to all my problems, but what are five things I can do immediately to improve my situation? Where am I inconsistently executing the right thing? Where am I not practicing with the level of intensity I know I am capable of? Where are we practicing but not correcting or getting the coaching that would give us insights about what we can do better? Where am I consistently executing the wrong thing? Where have I allowed the need for instant gratification to become a substitute for picking up the business end of a shovel and consistently breaking a sweat? What are three outcomes we previously set but have abandoned because of unrealistic expectations or inconsistent execution? Should any of these outcomes be resuscitated and reprioritized with the accompanying realistic plans, resources, and time frames? What are three bad habits/business practices we have tolerated that are undermining our results? What are the decisions I must make and the hard conversations I must have to break these bad habits once and for all? How will I adjust my behavior to create the success/outcomes I envision?

What do our customers want and how do I know that this is the right answer? What is the solution I need to design to meet their needs and address their pain? Do I have the ability (skill sets and resources) to successfully build this solution? How will I deliver it to them? What is the experience these customers want? What exactly is the gap between where customers are frustrated and what the competition is doing? Where can we find pockets of target customers who are frustrated with our competition? Where is the competition weak or deficient in delivering the outcomes, solutions, and value the market demands? What should we be doing to communicate to potential customers that we are the aspirin for their pain? What are the three primary problems (pains) my target market has? Where have I substituted my judgment for what I want to deliver for what the customers actually want to receive? How could I check in with our customers to find out what new pains they are experiencing or gains they want to achieve?

Where have I done a poor job of posting the speed limit (explicitly stating expectations, deliverables, and outcomes)? Who are the people in my organization that seem to require repeat conversations about the same issue? What is the “belief coaching” they need to get clarity around the correct beliefs that will enable them to do and keep their job? What is the deliverable that is missing? What is the outcome I want that isn’t being delivered? Where am I frustrated because an employee is not performing at the standard I expect (and set)? Is the problem that I haven’t set a clear standard? Is the problem a lack of specificity about what I want it to look like? A lack of training? A lack of consistent coaching (calling it tight) when the problem arises? A lack of understanding about why this is important and why it needs to be done correctly every time? Where have I created (or tolerated) a culture of mediocrity, an absence of accountability, a fear of saying what needs to be said, and an inattention to results, measurements, and periodic correction? What is the belief my employees must have for this problem to persist and what belief needs to be substituted for my employee to excel? Who needs to get an apology from me? What is the coaching I need to deliver to make sure the problem gets fixed and stays that way?

What is the structure we need to create the progress I want? What are the missing structural components required to produce consistent execution on our critical drivers? When I look at my business, where are the opportunities for me to tighten up the structure, processes, and efficiency of what gets done? Where do we have disorganization, inconsistent execution, slippage, and chaos? What are the obvious choke points in my business that continue to strangle the smooth operational flow of serving customers and supporting the back office? What specifically needs to happen to put some structure into place to address the turmoil? Is there an opportunity to hire someone (even part-time) to help fill some of our gaps or to support us in getting a process in place? What needs to happen to the workflow, back office, accounting, and support processes so my business functions smoothly and efficiently? Where is the structure of my calendar slipping that is preventing me from taking consistent action on my major initiatives?

What is the real problem I am facing and exactly how is this problem different from the one I thought I had? Or used to have? What are the poleaxes, shovels, and backpacks I’ve been lugging around that are no longer useful in helping me solve my immediate problem? What are the tired, worn-out strategies and plans that are no longer supporting us to solve the problem we face? What are the existing models of behavior we need to drop because they no longer work? What existing knowledge, training, or experience needs to be abandoned? What are the new, fresh ideas and solutions we need to create to get us past this problem and back on track to our desired outcomes? Survivors and successful people are always learning, innovating, and adjusting. If this statement is true, what do we need to learn and where do we need to adjust our performance to succeed? Who around me is screaming an alternative solution, but I am ignoring them because I don’t see the problem or the need to shift strategies? Under the broad heading “What got me here won’t get me there,” who do I need on my team, who is excess baggage slowing me down, and what do we need to start doing differently?

When I think about the outcomes (goals) we have set for the coming quarter or year, where do I need to get clarity about my starting point in terms of environment, resources, competition, etc.? Who can I ask to help me think through our reality so that I minimize the likelihood of tricking myself about our starting point or current capabilities? What is the specific path/plan we have designed to move us from here to there, and what additional color or specificity do I need to add to this path to make it executable? What would it take to transition our plans from “shoulds” (wouldn’t it be nice if . . .) to “musts” (failure is not an option)? What are the hard decisions and actions I have been postponing in the irrational hope I can “goal” it away? What are the nonnegotiable standards we must establish? What am I tolerating in my business that is sabotaging my results or that is incongruent with my standards? How do we build in the accountability required for the critical driver standards and outcomes we have committed to achieving? What is the specificity I need to add to our plan so that everyone on the team has a clear, measurable metric (target) they are shooting for? What are the specific causes I must identify that will enable the effect I want to happen? What have we done well and what am I grateful for? What are the unexpected opportunities that are being presented that might move us in the direction we want but don’t look the way we thought they would look? (Where is there a gaggle of quacking ducks?)

Where (exactly) have we fallen short on the Big 8 and what (exactly) do I need to do to create the accountability and culture of high performance? When I honestly evaluate our current progress, how much of my frustration is attributable to a miss on the Big 8 process? Where are the misses and what needs to be done now? Outcomes What are the few specific measurable outcomes I am optimizing for? (The clear, measurable target on the wall.) What are the specific expectations I have about what these outcomes look like when they are achieved? (What does success look like . . . specifically?) How do I successfully communicate these outcomes and create 100% clarity with my team about my expectations? Primary Gap/Obstacle What is the primary obstacle that is impeding our progress between Point A and Point B? If this obstacle is so obvious, why haven’t we seen or addressed this obstacle previously? (Is this really the obstacle or is it a symptom disguising the real problem?) What sacrifices will we need to make or risks we will need to take to overcome this obstacle? By saying “yes” to solving this obstacle, what are we required to say “no” to? If we are to be successful in overcoming this obstacle, what must we start doing and what must we stop doing? What is the specific measurable gap between where I am and where I want to be? Strategy/Plan What is the specific plan that will serve as our road map and guide on closing the gap so that we always know where we are in relation to the desired outcomes and have clarity on what needs to be executed and corrected? What are the specific measurable tasks that need to be performed to deliver these outcomes? Who will perform these tasks? What are the skill sets and execution intelligence required to perform these tasks? What are the resources (time, money, and people) required to successfully execute this plan? (See the “Options Analysis Matrix” chapter for clarity about allocating resources.) What is the projected outcome and specific target date for completion? What are the interim milestones (dates and progress points) that will tell me if we are on track for hitting the completion deadline? What is my strategy to overcome the primary obstacle in our way? Machine What are the specific processes, tactics, tasks, executables, and resources required for something to actually get done? What are the skills, physical and personnel assets, training, and best practices required to successfully build this machine and keep it running? What is the sequence of events that will ensure that we build this machine in the correct order? A Players What is the scorecard I have created for each person on the team? Without a scorecard to proactively measure and grade results and specific deliverables against a benchmark/standard, I have no ability to either grade or coach performance. (See Appendix 3 for an example of a CEO scorecard.) In evaluating my current team, where have I settled and, therefore, produced mediocrity? When I…

Where am I looking for the path of doing the least or the door marked “something for nothing” to create the success I want? Under the banner of doing the work required to deserve the success I desire, what needs to be done? To achieve the success I desire, what effort and expertise are required? Where are the sources of leverage I can capitalize on that would increase my production, revenue, or profits? What do I need to learn, or who do I need to hire, to help us create and sustain the profitability we are capable of producing? When I look at my competitors who are bigger and better than I am, what leverage did they create or what resources were acquired to attain that level of success? What have we done in the past that worked? What ideas have we had in the past that we didn’t follow through on? What ideas have we had in the past where we dabbled and didn’t fully commit or didn’t execute with enough intensity or consistency? What have I been procrastinating on doing that would help us get traction on this project? Where have I been active but not productive? What leverage do I need to enable me to create better results by utilizing someone else’s time, money, brains, network, or skills? Where do we need to improve our execution so that we are more competitive in the marketplace?

Where has the environment in which we’ve been operating (economic, technology, regulatory, competition, customer preferences, employees, cultural) changed over the last few years? How are customers’ expectations different today than they were two or five years ago? What will customers’ expectations be twelve months from now? Where has our expertise (relevance) as a company lagged or stagnated in the last thirty-six months? What skills or personnel do we need to add to excel at what we do, shift our direction, and optimize our bottom line? What is happening competitively that could change what we sell, how it is sold, the price we charge, and where/how/what we message? Are we learning, training, and evolving as fast as things are changing? Based on the answer to the questions above, what do we need to learn, who do we need to hire, what do we need to change to remain relevant and competitive?

In the last year, how many people tried us and never came back? How much did that lack of repeat business cost us in incremental revenue and profitability? If everything counts and nothing is neutral, where are we missing the mark on delivering on our promise and meeting our customers’ expectations? How can I be certain that our team is performing to our standards? How can I make sure we are consistently executing and meeting our customers’ expectations? What is our commitment to training and how can I be sure the training we offer is getting the traction and implementation I expect? What can cause our customers to not come back and what are we doing as a management team to prevent customer defection? What can we do to get the honest assessment from our customers about their experience so that we can minimize the likelihood of a customer firing us because of substandard performance? What are our “cold eggs and untoasted English muffin” that are sabotaging our customers’ experience? NOW . . . Go Think! You will thank me later. KJC

What are the one or two major

outcomes and deliverables I am prepared to commit to achieving this quarter? This year? What are the business outcomes and results I am prepared to make nonnegotiable? What would prevent me from finding an extra five minutes every morning (before I turn on my computer) to write down my major outcomes and plan my day before it starts? How could I create a ritual for this so that I didn’t miss for ninety days? What are the specific priorities and executables I must focus on and get on my calendar to create the momentum and results I have planned? I know that guardrails and rules help me avoid feeding every kitty scratching at my screen door. What are the most frequent reasons my calendar gets hijacked, and what guardrails do I need to build to keep these intruders from sabotaging my day? Who have I given permission to tell me the truth and hold me accountable? How frequently will I check in with this person? Am I willing to tell this person the truth so that he has the opportunity to coach me? Am I ready to play this game to win, or do I want to keep dabbling . . . hoping to get lucky? What does that look like, specifically?

Where have I allowed my business to abandon the advantages of being small? Where have I encouraged/tolerated systems and standardization as a substitute for intimacy and relationship? Where could I inject some flexibility back into how we are doing business? Where do I sense a shift in the market that I have been afraid to investigate because of an irrational fear that it might disrupt what we are currently doing? What are the things we should be doing if I weren’t so afraid of losing? How can I test these ideas in a small way so that in case it is a bad idea, it doesn’t torpedo the mother ship? What assumptions am I making about the current environment and my competition that, if wrong, would cause me significant economic distress? What is the competitive advantage we have relied on to attract and retain customers? What could erode or undermine this advantage? Knowing what I know about my business, if I decided to compete with myself, what would I do to put a major dent in my company? Where am I hanging on to strategies and solutions that were great answers in a different environment? What question do I need to ask to discover our vulnerability to a changing environment? What do we need to measure to have optics about what is changing?

These are all tactical solutions. But it is always a mistake to start your thinking with tactical. Tactical sounds like, “What could we do to increase sales?” Strategic sounds like, “Why are our sales numbers not twice as big? What is the core obstacle preventing the doubling of our revenue?” Asking a tactical question will always result in tactical answers.

Who do I want to buy from me? What must happen to cause them to buy? What must happen to keep them coming back? What could happen to cause them not to buy?

Where are we relying on the story and not the facts? Where have we been “sold” (or are currently implementing) a solution for the problem that isn’t? What solutions are we currently executing that are no longer relevant, given the shift in the environment over the last three to five years? (For a tragic real-world illustration of this mistake, read the chapter “Mann Gulch.”) Where have we made the fatal mistake of attempting to move away from our problems instead of fixing them? Where are we relying on “experts” to sell us solutions instead of first identifying the core problem that needs to be solved? Where are we throwing resources at the problem instead of resourcefulness? What solution have we created that is not working because we don’t have the skill set, experience, or bandwidth to successfully execute? What are the obvious problems we are experiencing and what needs to be done about them? What opportunities in front of me require additional knowledge or new skills? What are those skills and where can I best acquire them? Where are the life-threatening problems we are experiencing and what needs to be done to course-correct, fix them, or reduce the risks ASAP? Where is our business in pain (or what are the bottlenecks/choke points) and, based on this answer, what needs to be done to alleviate this pain? What have we been doing or thinking that we need to stop or change in order to accelerate our growth and profits?

Where has the “job” mentality of comfort zone, path of least resistance, and “do the least expecting the most” crept into my thinking and performance? Where are the growth opportunities that I have been postponing because they require extra effort or are outside my comfort zone? What business skills do I need to learn so that I can create the leverage required to be a successful Owner? Who can I learn them from? How important is learning this business stuff and how fast do I need to learn it? Who do I have on my team that is performing at a level of “just enough to get by” instead of really stretching and going for the gold medal? How do I define excellence? Why shouldn’t that standard be the standard I work toward regardless of my ownership percentage? If I had a Board of Directors, where do I need to pick up my game to deserve the raise (incremental profits) I am seeking?

Thinking Time When I look back several years, what has changed (either internally or externally in the environment) that is impacting my results? What must I do to confront this issue, fix it, and keep it fixed? What are the internal pressures or changes that are impacting my ability to keep the lug nuts tight? Where do the lug nuts tend to get loose when we are stressed or near capacity? What problems are we repeatedly solving (or are remaining unsolved)? Where (exactly) has the culture of training, accountability, and integrity been sabotaged by an obsession with fixing the problems vs. keeping the problems fixed? In our quest for size and speed, what are the changes that have caused the foundation to crack and the fundamentals to erode? What changes must I make to our culture if these problems are to be fixed once and for all? I know there is a big difference between doing and done. What needs to be finished?

owe you an apology. I did not do my job. I have allowed my lack of courage and desire to keep the peace to get in the way of being a leader. I tolerated the status quo and mediocrity because I didn’t want to have the hard conversations. I mistakenly believed it was more important to keep the peace than to have the courage required to lead. I admire and respect you, but I have let my admiration for you cloud my judgment and my willingness to say what needs to be said. Candidly, I have probably functioned in a friend and peer role and not in an Owner and leader role. I elevated being liked over being successful. I have been more in love with the tranquility than I have with our outcomes. One of the transitions all successful businesses must navigate is from mom-and-pop free-for-all (let’s all pitch in and get it done) to a more professional, disciplined management kind of structure. I made the mistake of giving people big titles and extensive latitude in the erroneous belief that this would produce an outcome-driven, results-oriented organization in which people were accountable for their results. I was wrong. What I need to do is what every sustainably successful organization in the history of mankind has done, and that is to transition from being a company of ideas, fire drills, drama, and fuzziness to a company of outcomes, standards, accountability, and results. The truth of the matter is we can have the best vision and mission statement in the world, but if no one has a clue as to how that translates to an obstacle we must overcome an outcome we are striving to achieve an executable plan a set of critical driver activities a standard of excellence a dashboard that gives us optics accountability and ownership then we have no shot at accomplishing that mission or delivering on those values. If no one knows exactly where we are and exactly what we are trying to accomplish, we will not understand the problem we are trying to solve or the gap we are trying to close. If we don’t have clarity of exactly what the obstacle is we are attempting to overcome, how do we prioritize resources or build a machine that allows us to get from here to there? If you look at an F-16 fighter jet, the sophistication of the dials and dashboards is breathtaking. Why is that? Because an F-16 is a high-performance machine. If a mistake is made in an F-16, someone is likely to die. Compare that to a tricycle, a low-performance machine. It has no cockpit or dashboard. It does not go very fast and takes a ton of manual effort to get from here to there. If a mistake is made on a tricycle, the worst that happens is a scab on your knee. The higher the performance or the faster you want to go, the greater the need for a cockpit of dials and dashboards. The greater the need for precise measurements, standards, structure, and accountability. Pilots of high-performance machines do not fly by the seat of their pants. Yet I have tolerated a culture of “hand crank” tricycle…

Thinking Time I know that making the decision to give the apology speech is just the beginning. What are the specific follow-on initiatives I need to consistently execute to ensure that the speech sticks? What are the rituals I must create to help us reinforce and follow through on this message? Where do I need to get clarity about the opportunities we must create to continue the dialog and messaging about the culture we are creating? How can I instill the ownership of these rules in my employees so that they become the guardians of our culture?

Thinking Time What is my vision of excellence? Where is my level of engagement and intensity of focus inconsistent with that vision and the outcomes I desire? What needs to happen for me to be one of the top ten experts in my field? Where am I dabbling (doing just enough to get by) and what needs to be done about it? If my vision of excellence is mastery, what needs to change and how would I live my life? Where have I focused on success (getting there) and am missing the distinction of excellence (staying there)?

Thinking Time What is the problem I am trying to solve? (Not the symptom. THE problem! Go brush up on Core Discipline of Thinking #2.) What is the obstacle or challenge that is preventing me from being where I want to be and achieving what I want to achieve? Is the strategy we currently have not working because it is a strategy we are not consistently executing on, or is it a bad strategy? How much of my lack of progress is a result of a lack of consistent execution? Where have I built a strategy that we simply cannot (or will not) execute? What can I do today to improve my situation? What are the existing (or easily acquired) resources, strengths, and underutilized assets at my disposal? What would I do if I only had $1,000 to spend on a solution? $10,000? $1,000,000? Where have I let a lack of resources become the roadblock for my resourcefulness? How could I solve this problem by suspending some of the “rules” (as I know them) and fighting a guerrilla war? What great “strategies” have I hatched in the past that are viable but are not getting executed?

Internal Strengths (Under-leveraged Assets) What special or core skills, expertise, knowledge, strengths, and competencies do we have? Do we have any special or leveragable relationships or alliances in our customer list or network of contacts and associates that could influence (or give us access to) groups of potential target buyers? What are the key alliances, testimonials, or “influencer” relationships we have (or could develop) that would influence potential buyers? Competitively, why do customers buy from us? Why isn’t this strength sufficient to cause more potential buyers to stop doing business with our competition and to start doing business with us? What is the key positioning statement or compelling promise of our brand? What is the excess capacity we currently have or excess resources we currently enjoy that are underutilized? External Needs (Environment-Competition-Pain) Different buyers have different outcomes, priorities, and definitions of “success.” Since we cannot be strong everywhere, what is the niche I need to focus on that has a problem/pain I can solve? What are the primary pains/problems within this market? What is this market most afraid of or frustrated about? Where is this group of customers frustrated by the gap between what they want and what the competition is delivering? What specific problem do they need to have solved? What is the primary gain this target market wants to get? People buy products to meet a need. What is their motivating need? Where is our competition weak or deficient in delivering the outcomes and value (“success proposition”) this target market demands? Who are the decision makers, and what is the best way to access and communicate with them? Are there any unique circumstances or market segments that would require special communication or decision-making considerations? Are there any attractive market segments I could penetrate by finding a large group of potential customers that have a common problem and are already in close proximity? (In other words, under the theory that birds of a feather flock together, if I am selling running socks, can I access the local running club or get an endorsement from the National Joggers Association?) Opportunity Based on our internal leveragable strengths and the external competitive environment, what are the specific ripe market segments we have identified as an ideal target customer? How is this target different from our current customer base? What are the additional resources (money, manpower, skill sets, marketing, and expertise) we need to acquire to successfully get traction with or penetrate this market segment? Does our organizational chart have some holes/upgrades that need to be filled in light of this new strategic opportunity? What risks does this new opportunity represent? What could go wrong? How much capital needs to be invested to adequately fund this opportunity? Can I live with the consequences should these risks occur? What is the clear…

Thinking Time Where have I allowed “our process” and way of doing things to become more important than the customer? If I honestly assess the attitude of my employees, where have I let the system be more important than their spirit? Where have I allowed a reliance on systems and perks to be a substitute for culture? Where have I allowed a reliance on systems to be a substitute for learning and education? Where do we need to start making exceptions to be exceptional? How do we need to change our processes or systems so that we’re more customer-centric? Where have we allowed an internal focus on systems replace an external focus on our customers’ needs and convenience? Where could I give my employees an opportunity to grow, learn, and contribute their ideas so they would engage in their work at a deeper level? Where could I allow our employees to be self-directed and in greater control of their processes and outcomes? Where have we relied on policy manuals to be a substitute for training and trust? Where am I letting the need to do it “my way” or the “right way” get in the way of meeting my employees’ needs and my customers’ expectations? Where have we stopped learning and grown calcified because of a system that either needs to be abandoned or seriously tweaked?

Why isn’t my business more profitable on the amount of sales I am currently producing? Where are we incurring costs that do not support either keeping the customers we’ve got or getting new ones? Where is the investment I am making excessive for the returns I am achieving? What must happen to reduce the investment and simultaneously increase the returns? Is it possible I need to tweak my business model by redesigning the machine? Knowing what I now know, if I could start with a blank piece of paper, what machine would I design and how would I run this business? If my Board of Directors fired me and brought in a new CEO, what changes would she make?

When I look back at the last few years, where have we made the mistake of adding new without simultaneously protecting the old? What lessons do I need to learn? Where have I mistakenly assumed that our existing projects are self-sustaining and require little or no ongoing attention? What needs to happen to cause our “old” strategies to continue to perform at the current pace with less manual hand crank and adult supervision? What assumptions have I made about the continuity of our existing revenue stream if we shift our focus to this new opportunity? What processes, people, training, engine, or dashboards do I need to implement to ensure stability of the execution and results of the business while we spin up the new thing? Where is our foundation wobbly or unstable in light of the growth we would like to drive?

General Why aren’t my sales 2X bigger than they are today (really)? Competitively, why do customers buy from us? What could happen to cause a potential customer to not buy from me? What can I do to eliminate these issues? Risk What is my competition messaging or doing that is causing my ideal target customer to do business with them and not with me? What specific risks, concerns, or fears do potential customers perceive that might be blocking their willingness to do business with me? If I am asking a customer to stop doing business with someone else and to start doing business with us, what are the risks they are imagining in making this switch? Friction What are the specific friction points that cause customers to hesitate or decline doing business with us? How might these friction points be mitigated or addressed? What is the frictionless, compelling promise we should make? Is this promise clear, unique, and strong enough to cause them to switch to us? The Difference That Makes the Difference What is the DIFFERENCE that makes the DIFFERENCE to the unsold target buyer? Is this difference the difference that makes the difference . . . or is it something else? What is the one thing that would be the difference that makes the difference for our target market and cause these people to immediately understand why this difference is important and meaningful? Is the message (promise) we are delivering to potential clients clear on the solution we offer that the competition cannot or does not offer? How does this message need to be communicated more effectively? Success Proposition How (specifically) does the unsold buyer define “success”? Competitively, does the value we are delivering to the client exceed the price we are charging? How do we know? What needs to happen to be sure? What expectations do our target customers have? How do we meet these expectations more effectively than our competition? What must happen to meet/exceed the customers’ expectations and cause them to experience certainty of success?

If I only had _______, I could spend more time running my business instead of replacing the spark plugs and pumping the gas. If I only could _______, I would have more time to run the business end of my business and make more money. Where am I confusing activity and sweat with productivity? What are the biggest time sucks and choke points that are preventing me from allocating an additional five hours per week to running the business end of my business? Knowing the choke points and having the funds to do something about it are two different problems. What are some creative (inexpensive) solutions that would move me in the right direction and alleviate some of the pain? What am I currently doing that should/could be outsourced or leveraged to someone else (even part-time) who actually enjoys and is good at the thing that is bogging me down, which would then free me up to do more of the critical, value-add, business Owner activities? What critical projects are languishing because I simply don’t have the time to allocate to them and get them off the ground? What could I do in the next week that would improve this situation? How can I prioritize my calendar to find an additional thirty minutes per day to chip away on the high-value projects?

Thinking Time If I am truly serious about building a first-class defense and creating sustainable financial success, what are the Top 10 highest-probability risks I am facing right now? What is the probability of each risk occurring? What is the financial cost of each risk if it does occur? How controllable, manageable, or uncontrollable is each risk? What can I do to minimize the probability and cost and increase my ability to control or manage the occurrence of each risk? Where are we relying on a “dodge all the bullets” mentality to create our success? What assumptions have I made about these risks that are wishful thinking and simply untrue? How strong is our defense and what can I do to improve our odds? Where have we suspended disbelief and ignored skepticism by telling ourselves a story that begins with, “We are different and the rules don’t apply to us because . . .”? What are the 2nd- and 3rd-order consequences of my current plans and initiatives? Where have I let greed and optimism infect our assumptions about the future to the point that I am not identifying or minimizing our risks?

Who is our target market? (This question can never be addressed too frequently.) What is our promise to them? How is our promise differentiated from our competition? How do I know this promise is being successfully delivered? Why isn’t this differentiation (strength) sufficient to cause more potential customers to stop doing business with our competition and to start doing business with us? Where have we let our focus drift from the core (primary) competitive advantage that we have? Is this core difference between the competition and us significant enough to cause potential customers to start using us? If not, what is? Where have we done a poor job of giving the customer the ammunition to justify using us instead of our competition? Where is our messaging weak, ineffective, or simply nonexistent about our core strength (the difference that makes the difference)? How does my target customer define success? Where are our internal priorities and operational focus misaligned with the promise we have made to our customers? Which internal priorities do we need to strengthen to be able to successfully deliver on our promise to customers? Where are we internally prioritizing (optimizing) for something we have not promised? Where do our team, dashboards, critical drivers, compensation structure, training, hiring, and culture need work so that we are more successful on the execution of the internal processes required to deliver on the success proposition we have promised?

Where have we let an obsession with our passion get in the way of an outward focus of finding the group of customers who have a problem I can solve? Why are customers buying this product or service and what is really most important to them? Where is the red-hot, searing pain or frustration in the market, and what are we doing to address that problem? What needs to happen to cause our target market to discriminate in our favor (really!)? When I really look at how my competition is doing what it is doing to capture market share, what do we need to change to compete more effectively? Where do we need to carve out a niche or control some real estate in consumers’ minds about our message, our promise, and our results?

Keep More Customers Why do people buy from me in the first place? What value do they seek? Expect? Hope for? What is their TRUE pain/problem/frustration? What is the compelling promise of our brand? Is the message (promise) I am delivering to customers clear on what we can do for them that the competition cannot or does not do? What must happen to cause a customer to buy from me? What must happen to keep a customer coming back? Does the value we are delivering to the client exceed the price we are charging? How do we know? What changes do I need to make to my business to ensure my continued relevance to my customers? Increase Referrals and Repeats What percentage of our business comes from repeat customers? Is that percentage growing? By how much? What are we doing to ensure that customers will come back for seconds? What could we do (that we are not currently doing) to cause our customers to want a second helping of what we are serving? How can we get them to come back more frequently? How would I run my business if 100% of my future growth was by referral and repeat customers only? What promise do we make to our customers? Where do we need to realign our internal operations to consistently deliver on this promise? What can I do to delight and amaze my customers? What can I do to cause my customers to become addicted to buying from me? Define and Enhance Certainty of Success What is my “success proposition”? What does my ideal customer consider “success”? What are we doing to give our customers “certainty of success”? What else do we need to do? What are we doing to meet their expectations? What expectations do my customers have that we are not meeting? What expectations have I set for my customers, and how are these different from the expectations I am delivering? What can I do to cause my customers to say “I would have to be crazy to do business with someone else”? Where have we compromised on the trade-offs necessary for my business to deliver on our success proposition? Where have we compromised or homogenized our niche by blurring our uniqueness in an attempt to grow? What are the activities we perform that are not aligned with each other? Where are we producing a result that is inconsistent with our message? What needs to happen for all my employees to know exactly what our success proposition is? What are the specific activities each person must consistently perform to deliver this success proposition? Where does my dashboard need to be rebuilt to make sure I am measuring and monitoring this performance? Where does my compensation structure need to be adjusted to reward performance that delivers on our success proposition? Enhance/Train the Sales Process What is our existing script and process to enroll new customers? What is our current internal sales training process? What does a first-class training process look like? What is the curriculum we need to teach and train in order for our staff to be more effective at initiating and…

The biggest problem with an exit is that, after the sale, you have a ton of cash and no cash flow. So, now you must invest this cash someplace (usually someplace you know very little about) to receive a return, and few returns can match the cash flow of the business you just sold.

Thinking Time What are the concentration risks in our business? Where are we exposed if we lose a key person or relationship? What could disrupt our revenue, customer acquisition, repeat business, or referrals? (Chipotle restaurants and Blue Bell Ice Cream thought this wasn’t a risk . . . until it was.) What could cause our expenses to dramatically escalate? Where are the risks in our business model structure? What assumptions are we making about the continuity of our business structure and source(s) of revenue? What are the external risks that we are exposed to and how might we best inoculate ourselves from catching whatever “dis-ease” might break out? Where have we been overly optimistic with our capital structure and debt load? What is the plan if our revenues and cash flow take a 25% hit? How much do I need in dry powder (cash reserves) to be able to weather a six- to twelve-month storm? Where is the excess capacity in our business? How do we make our “assets” more productive or eliminate some waste/redundancy? What really needs to happen to improve the exitability of my business? What are the three primary initiatives I must focus on as CEO to maximize the enterprise value? If someone offered me an opportunity to buy my business, what price would I pay? What can I do to increase that number by 50% in the next twelve months?

Thinking Time Am I currently executing an idea or a plan? If it is an idea, what does the plan need to look like? Where have I let my ideas become a substitute for my quarterly and annual plans? Since a plan is always executable, do I know which actions to perform next week, next month, next quarter to move the needle toward my outcome? Does my team know what they are supposed to be doing to help us get from here to there? If so, what is that . . . specifically? Where are my current results deviating from my plan and what are the critical driver performance metrics that must be monitored in light of this variance? How does my budget vs. actual financial comparison stack up? Were there some faulty assumptions in my current plan? Where? Was I overly optimistic about the time frames? Where? Has the environment changed and thereby rendered my original plan obsolete? If so, where and what needs to be done about it? Was the original plan a good one and the problem is a lack of consistent execution? If so, where? Where is the gap between my plan and our results a reflection of a mediocre team or weak players? Is the team sound but the problem is a lousy culture or a lack of training? Where? Maybe the training is good, but the problem is that no one is measuring the critical drivers and taking immediate corrective action? If so, where? How do I know which of these might be true and what needs to happen to correct this situation?

What decisions have I been postponing in the irrational hope that the problem will somehow resolve itself? I am aware there is one primary decision in my business that I have been avoiding, and that this decision is the thing that is holding me back. What do I intend to do about it? What is the decision I know I need to make? What am I tolerating in my business that is sabotaging my results or that is incongruent with my standards? Where am I stuck? What have we done in the past that has worked in solving this problem? What is my largest competitor doing to address this issue? What do I already know that I should be doing but I am not executing . . . or not executing on a consistent basis? Where am I paralyzed because I am looking for an easier answer instead of doing what I know? Where have I allowed the need for perfect to get in the way of possible? What could I do today to improve my situation? If what I know is insufficient to making forward progress, what new strategies and skills do I need to learn, who do I need to learn them from, what books do I need to read, or what courses do I need to take? Where is my shovel and why am I not using it?

What major outcome am I optimizing for? (Specificity is my friend.) What are the various options I have created or found? For each of the options I have created: What is the estimated amount of time between now and the attainment of the outcome? How many hours (or what percentage of my time) would be required? How much money (investment) would be required? Which current activities would be reduced or stopped to be able to add this option to our execution agenda? (What must be sacrificed?) Do we have the expertise and execution intelligence (competence) to successfully perform the tasks required? What is the probability of failure? (If this option fails, what is the financial and lost opportunity cost?) Is the price of failure worth the risk? If this option succeeds, what is the monetary payoff? When (date or lapsed time from today) will we receive the payoff from executing on this option? In evaluating all the various input and output factors about each option and comparing these various data points, which option appears to be the most viable and attractive? Are there any input categories (variables) that deserve to be weighted differently that might skew my analysis and thinking? NOW . . . Go Think! You will thank me later. KJC

What are the outcomes (effects) I want that are still undelivered? If my outcomes are missing or the gap is not closing, what are the causes that are missing? Is the problem that we are inconsistently executing on the right things? If so, how do we tighten this up? I need to reexamine my desired outcomes (goals) from the viewpoint of cause and effect. Has my progress or momentum stalled because I am not seeing instantaneous results? Where am I running the wrong direction enthusiastically? Is there an obstacle in my way that requires a new solution and different execution? What is stopping me from doing my job? How would the person I want to be do the thing I am about to do? What is my level of intensity and will this level of engagement produce my desired effects? What am I executing that used to work but is not the right strategy in this environment? What do I need to stop doing and what do I need to start doing? When I have a bad month financially, what are the three to five things that should have happened that didn’t happen? What are the three to five things that did happen that shouldn’t have happened? These are my critical drivers. What needs to change to create the outcome/standard we have set and what will I measure to ensure consistent performance on these critical drivers? What is the specific measurable standard of performance we need to achieve for each critical driver to ensure we are moving toward the desired outcome (effect)? How frequently do these critical drivers need to be measured and reported? What is the dashboard I will use that provides me with the optics necessary to understand our performance and take corrective action? How do I best engage my team in the process of measuring, monitoring, and correcting on each critical driver standard? How do I give my team ownership of their critical drivers?

Where are my results weakest? What keeps me up at night and what am I measuring to identify the problems and improve the situation? What are the three to five critical drivers I need to measure to ensure the progress I want? What is the standard (specifically) of each critical driver and are these standards clearly communicated to the person responsible for achieving them? What are the hard conversations I need to have based on the results we are getting, so we can correct and improve? Based on our measuring, what is the training needed to raise our performance and improve our results? (After all, if they can train a polar bear to ride a tricycle, how hard can it be to train my people to do their job?) Where (exactly) is our consistency of execution deficient and what needs to be done about that problem? What is the dashboard I need to create so that my measuring, critical drivers, and standards are all in one place and easy for me to digest? Based on the optics I receive from my measuring and dashboards, where have we settled for mediocre and average instead of demanding excellence? What (specifically) needs to change to hit our standards and produce excellence?

Thinking Time What am I optimizing for? What one meaningful, specific outcome, if I achieved it, would have a significant positive impact on my business? What are the specific obstacles standing in my way of making measurable progress on this outcome? What specific activities must I prioritize to make measurable progress toward this outcome? What resources would need to be acquired or reconfigured to move the needle on this priority? What are the three most significant things I could do this week that would kick the can and close the gap by moving me closer to my major priority? What are three things I would need to stop doing to make room for this major priority? How do I regain control of my calendar and minimize the “got-a-minute” interruptions that are sabotaging my time? How much time should I spend thinking about what I need to prioritize and spend time on? If I am raising my standards by prioritizing my majors, activities, and deliverables, how might I enroll my senior leadership team in this process as well? (You will be stunned by their accountability and the progress people can make when they have clarity about their majors and minors and what they are optimizing for.)

Bumper Stickers, Reminders, Words of Caution, Hints & Never Forgets The Dreaded Dumb Tax It turns out that the key to getting rich (and staying that way) is to avoid doing stupid things. I don’t need to do more smart things. I just need to do fewer dumb things. I need to avoid making emotional decisions and swinging at bad pitches. I need to think! All my problems started out as a good idea, and all those “good” ideas were emotionally justifiable at the time. Not only that, my current financial condition represents my very best “thinking.” Yours does, too. What sabotages our dreams and causes most of our problems (and ensuing dumb tax) is our excessive optimism and emotional belief in magic pills, secret formulas, and financial tooth fairies. (All balloons look good when they are filled with hot air.) Dumb! Emotions and intellect work inversely. When emotions go up, intellect goes down. Optimism is a deadly emotion in the business world. Warren Buffett said it best: “Optimism is the enemy of the rational investor.” There are no secrets . . . just stuff you haven’t learned yet. The Discipline of Thinking Time Find the Unasked Question—Create a question that will result in clarity and generate better choices. Separate the Problem from the Symptom—Identify the real obstacle that is blocking my progress. Check Assumptions—Differentiate the facts from the story I am spinning. Consider 2nd-Order Consequences—Clarify the risks and the possibility/cost of being wrong. Create the Machine—Create the executable plan and identify the resources (people and money) required to solve the real (core) problem and make forward progress. The 5 Core Disciplines of Thinking Having the right answer is smart. Having the right question is genius. Or, as Peter Drucker said, “Most serious mistakes are not being made as a result of wrong answers. The truly dangerous thing is asking the wrong question.” The key to defining the root problem is discovering the obstacle (it resides in the gap) that is impeding your progress from here to there. It is the obstacle that is the problem, not the dissatisfaction with your current circumstances! Building a machine for the problem that isn’t and expecting forward progress is delusional. If we misdiagnose or mislabel the problem, we will gravitate toward designing solutions and building machines for the symptoms (aka “the problem that isn’t”) and this is a prescription for frustration and failure. Few things are worse than running the wrong direction enthusiastically. Misdiagnosing the problem or working on the wrong priorities results in a dumb tax! What none of us see are the assumptions we make about the problem we have, the solution we create, or the opportunity in front of us. The reality is that virtually all my dumb tax could have been avoided if I had just questioned a couple of obvious assumptions prior to pulling the trigger. Stupid in small things, stupid in big things. We only have a choice about the decision we are about…

Financial Attain Gross Revenue of: $ ____________by December 2017 (1 year) $ ____________by December 2019 (3 years) $ ____by December 2021 (5 years) Attain _____ % Gross Margin by December 2017. Attain _____ % EBITDA by December 2017. Attain _____ % of Cash Flow from Operations by December 2017. A/R below ____ days in 2017 Debt reduction of at least $ in 2017 Create and maintain a company that is proud of and protects its culture of respect, integrity, intelligence, and productivity: a culture that is based on trust, appreciation, candor, excellence, and improvement. Customer Satisfaction is at least 4.5 out of 5 by December 2017. Employee Satisfaction is at least 4.0 out of 5 by December 2017. Every employee receives at least quarterly coaching on their specific results. All employees above XXX level use the monthly or weekly “Managing by Objectives,” or “MBO,” process. Net Promoter Score “NPS” is 75% by December 2017. Employee turnover (they quit) is <5% in 2017. We should never be surprised when an employee quits and they should never be surprised when their employment is terminated. Create and maintain an outcomes-based organization filled with A players who are self-driven and want to be held accountable and rewarded for achieving outcomes and results. Comprised of people with a high internal emotional need to succeed, a commitment to growth, and a desire to improve. 85% of all personnel are true A players, as measured by their performance against their standards and their cultural fit. 15% are B players being coached/trained into A players and have a specific, personalized path to attain A-player status. 0% C/D players A specific onboarding plan for every new hire, regardless of the position 100% of personnel have and maintain a scorecard. 100% of personnel have a dashboard that monitors performance of critical drivers. 100% of personnel have compensation packages that include base salary and personal performance bonuses. 100% of raises, bonuses, commissions, and promotions are based upon attainment of outcomes, results, and standards. 100% of all hiring selections and promotions are evaluated and selected using the Topgrading process. (You must read Who by Geoff Smart for more about this interviewing and hiring methodology.) Create and maintain an organization committed to excellence and growth by providing opportunities for learning and training to improve the skills of their current position, begin learning skills for advancement or cross training, and improve each person’s overall mental wellness. All employees receive monthly or quarterly training of at least 5 hours per quarter; 20 hours per year is the minimum. Training can be either internal or external . . . either job-specific or general improvement. More is better. All employees are to “read” at least one assigned book per quarter . . . to be discussed at one of the training meetings. All employees’ specific work and processes are documented so that a new person…