Momentum Podcast: 280

Don'T Scale Complexity

by Alex Charfen

Introduction

Introduction goes here

Episode Description

There is a reason why we share our revenue, expenses and profit with our team. I want our team to know the score. The more simple the business is to me, the bigger I can grow it. The more clarity, the faster we can make things happen. 

If you start with complexity, you'll have to scale it forward. Let me share with you how we manage projects within our company.

Full Audio Transcript

I'm alex Charfen, and this is the Momentum podcast, made for empire-builders, game-changers, trailblazers, shot-takers, record-breakers, world-makers and creators of all kinds.

Those among us who can't turn it off and don't know why anyone would want to. We challenge complacency, destroy apathy, and we are obsessed with creating momentum so we can roll over bureaucracy and make our greatest contribution. Sure, we pay attention to their rules, but only so that we can bend them, break them, then re-write them around our own will. We don't accept our destiny, we define it. We don't understand defeat because you only lose if you stop, and we don't know how. While the rest of the world strives for average and clings desperately to the status quo we are the minority, the few, who are willing to hallucinate there could be a better future, and instead of just daydreaming of what could be, we endure the vulnerability and exposure it takes to make it real.

We are the evolutionary hunters. Clearly the most important people in the world, because entrepreneurs are the only source of consistent, positive human evolution, and we always will be. Don't scale complexity.

I just got off my monthly all-hands meeting with my team, and the monthly all-hands for us is a really simple monthly meeting for us and for all of our clients. It's a simply monthly meeting where we get on, and it's very direct and to the point. Everyone on the team is on it. It takes about a half hour; we go through what we planned to do in the previous month; what we achieved; then we go through our financial results, and we share with full transparency what our gross income was. How much did we make? What was our revenue? We share all of our expenses. What was the amount of the expenses, and then what was the profitability? How much did we make in the month?

And the reason we do this is I want every single person on our team to know the score. While we were on that meeting, I had Eddie here, who is our video ... he runs all of our production. He does our video recording, he does our editing, he's incredibly awesome ... and Eddie was here hanging out with me, and afterwards ... he actually recorded me holding the monthly all-hands meeting for one of our video blogs ... and he was asking me questions afterwards, and he said, "You know, how does it feel for you, as a CEO, to have a system where meetings can be this simple, this direct, this to-the-point, and everyone on the team knows what's going on?"

And my answer to him was, "You know, it makes me feel like I can run a business far greater in size than I'm capable of paying attention to, because the more simple it is, the bigger I feel like I can scale. The easier it feels for me, the more I feel like putting my foot down, and the more I have clarity and confidence, the more commitment I have about growing the business."

And for me, using a system like our cadence, where you have the communication structure, we run it on docs and sheets, it's really easy. It's incredibly simple. Anybody on the team can understand what's going on. And then you compare to what a lot of companies are doing these days, and they're using project management software, or they have some system like Trello or Basecamp or Asana, or something else like that that you have to log in to, and here's the problem with all of those systems, is that ... in the companies I've had, we've tried using them, and I finally went back to the system that I scaled the largest business I ever had on. I grew a $250 million company with offices all over Latin America, throughout the world. We had one of the largest events companies in Latin America. We had one of the largest consulting companies in Latin America. We were doing massive volume with Fortune 500 companies, and we grew that thing on documents on spreadsheets.

And it grew fast, because there was very little complexity in the growth of the business, and today, that's exactly how we show the companies we work with to grow, on docs and spreadsheets. We use Google Docs, and Google Sheets because it's easy, and we show them how to manage their entire business on a minimum number of documents, with a series of processes that makes things really easy to understand everything that's going on with every person in the business, and to know whether you're winning or not.

And you do not have to have a project management software that you have your entire team sign in to, because here's my argument for this, and I really want you to listen to this if you're growing a business. If you're in those early stages, well, if you start with complexity, you're going to have to scale it all the way forward. If you're at that place where you're just about to build a team, well that understanding of the project management software you've been using is now an understanding you have to pass on to every single member of the team in the future, who you expect to be effective. And if you're growing a large team, that project management software ... here's the problem, all the way through, especially for a large team, is that the people who will do well in your company are no longer the talented people. The people who will do well in your company are the people who are good at the project management software.

It's the ones who are really gifted, and understand Trello really well, or Asana, or Basecamp, or any one of those programs, and I've watched this my whole career, because here's the reality: complexity obscures talent. When you create complexity in your business, you will hide the talented people. When you have complex systems like Asana or Trello or Basecamp, here's the fact: if you have somebody who's an incredibly talented copywriter, the chances that they are an incredibly talented project management software user are really low. If you have somebody who's an incredibly talented designer, who can create design that catches people's eye, and is awesome; it's incredible; the chances that they're really good at project management software? Very slim.

If somebody like Eddie ... Eddie was just here. Ridiculously talented shooter and editor and sound guy and creative. Holy Cow, that package is rare. And we were just talking about project management software, and I said, "You know that feeling of energetically signing in to project management software," and he's like, "Oh, dude, it's so paralyzing." He's like, "You don't even know where to start."

And I get it. You get used to it. It gets easier. All of those arguments, but here's the problem. That same growth curve is going to exist for every person you hire, moving forward. And so the more complex your project management system becomes, the more difficult it becomes for every new person in your organization. You start creating a descending on-boarding curve for every new person. You actually make it harder to work with your company as you more forward instead of making it easier. As the project management system gets built out, and there's more and more of it and it takes over more and more of the company, it gets harder to unload it, and again, it will obscure talent.

An easy example ... and if you're heard my podcast for a while, if you've listened to the episodes you've heard this example before ... Apple, a technology company and arguably the most valuable corporation in the world. -- Not one of -- the most valuable corporation in the world, runs on a minimal-technology burden. It's actually something they talk about. They do not want a high-technology burden for people coming in to the organization. Apple's a technology company. My cousin, [Eric Bower 00:07:31], who's one of the smartest people I've ever met, when we were younger -- when we were kids -- he was like, "Someday I'm going to work for Apple," and we all loved Apple, and I was like, "Yeah, whatever," and Eric's the dude who actually did it. He's the dude who, when he says, "I'm going to go do something that nobody else can do," you got to get out of his way because he normally has.

And he runs a cross-functional team at Apple, of I think it's 80 people. He's dome some amazing stuff there. He was the manager responsible for the button that's not a button on the current iPhone. When they started that project they had no idea how they were going to do it. It was an engineering impossibility, and then they pulled it off. So Apple's not in the business of doing normal things. They're in the business of changing the world, and I get to vicariously hear about it through Eric, and gosh, every time he tells me a story about Apple it confirms why I love the company so much. It confirms everything I've ever thought about Steve Jobs, and how brilliant he was. It confirms the fact that everybody who I ever have bought a computer for on my team has an Apple, unless there is a software impossibility, we had to get a PC, and then we didn't even let it touch the network because ours was clean. It was all Apple. And then, check this out.

If you work at Apple, here's the technology burden you have. Unless, if you're a film editor, then you're going to have to know film editing software. If you're an engineer, you're going to have to know the engineering software, but every employee at Apple is required to know the following four programs. Not Basecamp. Not Asana. Not Trello. Not any of those. They need to know Keynote Online, the slides program that Apple has. Keynote Online is how they communicate in their groups, because they basically just communicate in bullet points, so the bullet points you would have for a presentation, that's how they update what's going on. And they use Messenger, text messenger, to communicate with each other. They use Mail to send longer messages to the other, and then they have an online software product that allows them to publish a wiki. That's it. Those four things.

So they have an online platform, Mail, Messenger, and Keynote Online, and with that, Apple runs the single most valuable company in the world.

Now there's an interesting question here. Is Apple the single most valuable company in the world because they have no complexity, or is Apple able to have no complexity because they're the single most valuable company in the world? I think it's the first. I think that Apple puts the energy where it matters. In each individual department they figure out where people should be focused and they hyper-focus them on that, rather than training every single person on some project management software. They don't allow project management software in a lot of places in major corporations, because in a lot of major companies they're afraid that it'll get in and they won't be able to get it out, because it creates so much complexity.

And I've worked with hundreds of companies, and I've been inside the c-suite, so I haven't just worked with companies in a passive way, I've been in the leadership meetings. I've helped build executive teams. I've helped calm executive crisis. I've helped create companies that created value in excess of a billion dollars more than once, and what I can tell you about all of the organizations that I've worked with, is the ones that scale the biggest; the ones that scale the fastest; the ones that have the highest level of profitability, are the ones that keep things the simplest and don't have a high technology burden to getting involved.

And over and over, those who run their business through some type of a platform and the ones who have the biggest issues, because you can't stop it from happening if you have those systems, people start being managed through a platform, rather than person to person. And when you look at the reason Apple has a minimal technology burden, is that what they're trying to do is create maximum human connection and minimal technology burden. Because when you connect people around a common outcome, and you motivate them to press forward together, that is how you create the most valuable company in the world.

And it's depressing to me, how many entrepreneurs today who are just getting started, when they get up in the morning to run their business they have to use their password. They sign in to a platform that tells them what to do. Because the fastest way to run a business is with the least complexity, and the minimum effective dose of everything that you could possibly need. And early on in your business the last thing you need is to get caught up in some other software platform that runs everything for you. Tomorrow, pick a process in your business, pull up a document, and then write the checklist of everything that's in that process, and you'll see just how fast you can go. You can literally print that and hand it to them, and within 15 minutes they're up and running on that process. Asking you questions, making clearer, and doing it for you, and when you run your business with that level of simplicity, everything that you execute gets easier.

And one of the biggest challenges is that if you allow complexity into your business in the beginning, you will subconsciously fight scale. You will subconsciously sabotage growth. You will have a hard time getting things done during the day. You'll procrastinate. You'll look at yourself and think, "Why am I not doing what I know I should do?" Well here's why: when we know we are going to scale pain, we will protect ourselves. We are evolutionary hunters. Subconsciously, we see a much greater future than we do consciously, and it affects us in the present, so you have to resolve the present. And by simplifying your business and making it easy, and making it so that somebody can walk in tomorrow and get up and running quickly, and making it so you can manage your team without having to sign into a platform to know what's going on, everything in your business will get easier.

And again, I can't say enough about if you put project management software in to your business, you will hide the most talented artists and designers and writers and creatives, because they will struggle with it, and instead, you may have happen what I've seen happen, where people actually are promoted based on understanding the project management software. I've seen people in operations promoted far too fast, in to far too high positions in fast-growth companies because they were expert in a platform, not expert in the discipline of operations, and that is a tragedy every single time, Because running a business, managing people, creating a team that can pull forward to a common objective and make things happen? You just can't do all of that through an app. It's not possible.

If you're ready to start simplifying your business; growing it fast; having minimum effective dose processes so you can manage a growing team and get to greater outcomes without feeling like you're going to do it all yourself, and without sabotaging your growth, reach out to my team. Go to billionairecode.com, answer a few questions for us, and you'll be given an opportunity to book a call with my team.

We'd be happy to show you how we can help you build a forward-looking planning system, a communications cadence with your team, and the right infrastructure and the right people around you so you can grow and scale your business fast. When you scale with simplicity it's amazing how fast you'll go, and how confident you'll feel compared to entrepreneurs who are struggling to run their businesses through an app. Don't follow that trap. Go to billionairecode.com, fill out some information, and let's connect.

Thank You For Listening!

I am truly grateful that you have chosen to spend your time listening to me and my podcast.

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With gratitude,

Alex

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