Momentum Podcast: 504
Part 2: 5 Reasons Why Companies That Should Scale, Don't: Communication System
by Alex Charfen
There is one place where most problems in any business come from. It's challenges in communications. Communicating what's needed, what's expected, what's wanted, what the objective or outcome is in a business on a day-to-day basis to keep it moving forward is a challenge and it causes massive problems.
Now in entrepreneurial businesses, communication is even more challenging than in larger companies because in a small business, when the team doesn't hear from the entrepreneur within a system, they often get confused, don't know what significant, and they have a tough time moving forward.
There’s one place where most problems in any business come from, challenges in communication.
For a business to scale, it needs to have a system for communication, a cadence. Communication outside of a system is often misunderstood. When communication is predictable, comprehension and retention of information go up. When meetings are choreographed and repetitive, you can move people around with clarity. If you install a communication cadence, your team will be aligned, your issues will go down, and your momentum will go through the roof.
Full Transcript Below
Alex Charfen: There is one place where most problems in any business come from. It's challenges in communications. Communicating what's needed, what's expected, what's wanted, what the objective or outcome is in a business on a day-to-day basis to keep it moving forward is a challenge and it causes massive problems. Now in entrepreneurial businesses, communication is even more challenging than in larger companies because in a small business, when the team doesn't hear from the entrepreneur within a system, they often get confused, don't know what significant, and they have a tough time moving forward.
This is the second of the five reasons that companies that should scale don't: communication systems. 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 rewrite 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.
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Here's what it's like for a team member in an entrepreneurial business where there is no system for communication, and by system for communication up front here I want you to know, what I mean is a cadence where you are having the same meetings at the same time, the same conversations at the same time, you're updating their team in the same way, at the same time, over and over again.
To a lot of entrepreneurs, as I say that, we get uncomfortable and think, you may not have to have meetings on my calendar at the same time every week, I never want to do that. Well, if you never want to do that, you probably shouldn't be running a business because if you're going to have haphazard communication with your team and you're not going to put a system in place, it makes it incredibly challenging for your team to know what they're doing and for you to be able to grow and scale your business. Communication systems change everything.
Here's the issue in small businesses. Entrepreneurs either communicate way too much or not enough, and either way the team is waiting for word from on high. See, when they don't know when they're going to hear from you, when they don't know how they're going to hear from you, and when they don't know why they're going to hear from you, they're always waiting to hear what's going to happen next. The challenge is in the case where you communicate too much, they don't know what's significant and they will choose what they think is, and often that will be a miscommunication. In a case where an entrepreneur is not communicating enough, the team will hear them communicate what they do and it will become way too significant and may modify behavior or change plans.
So here's the key to running an entrepreneurial business, getting it up and running, and growing your team and having everyone on the team be in momentum and understand where they're going. You must have a communication structure, a system, a process through which you communicate because in a business, most problems are communication. But we blame other things. We blame hiring and process and systems and structure. We blame people all the time, but the fact is, if we accept that most problems are communication.
If you talk to any coach or consultant who helps with business growth, they're going to tell you communication is one of the top issues, if not the absolute top issue in company challenges. If we accept that this is true and we're willing to create a process around communication and make it systematic and structures that our team knows when they're going to hear from us, everything in our businesses and everything in our lives will change. Here's why.
Number one, communication outside of a system is often misunderstood. Here's the reason. When your team doesn't know why you're communicating or how you communicating or what you're communicating, you often won't have them, or you often won't get the result you want from them. If you're having, and here's what happens in so many businesses, meetings are haphazard. They don't happen often enough. Then when they do happen, there's way too many things that are tried to be covered or there's creep and the business or the meeting starts from one thing and ends with another and goes in 18 different directions, and it's confusing for people.
When you have what I talked about in the last podcast, a strategic plan, the second thing you need is a communication system to communicate that strategic plan consistently so everyone on your team knows exactly what is going on. When you communicate within your system, your team will hear you. Here's why.
The second reason, when communication is predictable, comprehension and retention go up. Here's what I'm willing to bet. You might not have watched Wheel of Fortune in a long time. However, if I asked you to, if you've seen it once or twice and you've watched Wheel of Fortune, you could probably give me an outline of what happens at the show.
I've seen it twice; once when my friend was actually live on the show and I went and sat in the studio audience and I was blown away that it was one of the top rated shows on TV because I could never see myself actually sitting through that show. And then I watched it when it came out on TV and he was on TV at a party. I remember thinking, I can't believe people watch this for a half hour every night.
It's basically two word puzzles or three word puzzles; two in the beginning, then one at the end for the person who is in the challenge and a lot of noise in between. I'm like, Wheel of Fortune could be a four and a half minute show if you wanted it to. It could probably be a three minute show if you were really strict on your editing.
But, why do people watch it? It's predictable. It's something that they know is going to happen. They know what's happening next, and the vast majority of the population wants predictability. They want to be able to guess what's going to happen next. They want to be able to anticipate what's happening next. When you put someone in a communication system that's predictable, comprehension goes up. They actually understand more of what's being said because they're not asking themselves, why are we having this conversation? What is he trying to do? What's the outcome here?
All of the things that people ask when an entrepreneur communicates, when you're communicating within a system, you take that noise away. And so not just comprehension, retention of information goes up too. If your team doesn't understand why they're being communicated with, if it's not in a predetermined targeted interaction, which is what we call meetings. We don't have meetings in our company, and we don't have meetings... Our clients don't have meetings. Meetings are terrible. It's just getting together and doing stuff.
We have targeted interactions where we know the outcome going in, it's choreographed so we know exactly the steps we're going to take in every meeting. It's predictable because everyone knows, they've been there before and if they haven't, they can watch the agenda and know exactly what's going to happen and then we also, it's predetermined. They know in advance that it's on the calendar, that it's coming. There is no surprise meetings in our business because we want comprehension and retention to be at the absolute highest for every member of our team who's in the meeting.
Number three, here's a big one. When meetings are choreographed and repetitive, you can move people around with clarity. See, if a department meeting in one place is the same choreography, the same structure, the same agenda as a department meeting in another place in your business, you can move a person from one department to another department and there's continuity for them.
There's actually an understanding of what's going to happen in the meetings, what's going to happen next. When people feel that understanding, when they can anticipate and predict, they actually feel more intelligent and they have the three Cs. You hear me talk about these all the time. When you have a communication system, you increase clarity for your team. Last podcast was a strategic plan. That tells everybody where you're going, when you communicate that strategic plan within a system, you dramatically increase clarity for everyone on your team. Second, when your team has a... When you have a communication system and they hear from you in a predictable way, in a repetitive way, they know why they're hearing from you. They know when they're hearing from you, how they're going to hear from you.
What happens is, you actually have, is not just clarity that goes up, confidence goes up. When your team is more confident, they will anticipate what's coming next. When your team's more confident, they'll take risks, they'll move out. I hear entrepreneurs all the time say things like, my team doesn't take initiative. Well, when your team lacks confidence, they will not take initiative. They'll do what they're told but they will not take initiative.
If you want your team to take initiative, give them clarity and confidence and if you do that, you will have the third C, commitment. Commitment is when a team member commits to the company. It's when they commit to what your outcome is. It's when they commit to your client centric mission and helping you get to the biggest outcome and biggest contribution your business can.
When you get commitment like that from a team member, here's what you get. You get their discretionary time. When they're driving down the road, when they're in the shower, you hear me talk about this all the time. I want you to get more leverage of out of the people that you have right now and a big part of that is a communication structure within which you communicate, the communication cadence. We actually teach cadence, a system called the Charfen Cadence.
Here's the math I want you to understand around a communication system. We've done hundreds, maybe thousands at this point, of time studies with entrepreneurs where for two weeks we haven't tracked their time. You've heard me talk about this, I've had podcasts on it. We track their time in 15 minute increments and we look at what they're doing in each of those time slots.
What we've found is that in most entrepreneurial businesses, entrepreneurs are spending somewhere between 50 to 75% of their time just getting the business to move forward. When you look at a 40 hour work week at 50%, that's a 1000 hours a year. When you look at a 60 hour work week, which is much more common for entrepreneurs, 60 hours or more. When you'll get 75%, that's 2250 hours a year.
That means just getting your business to move forward, you're spending 250 hours a year more than someone who's working full time. That changes everything. That's why, and it doesn't change, it challenges everything. That's why so many entrepreneurs have a hard time getting what they want to get done. That's why so many entrepreneurs feel overwhelmed all the time.
That's why so many entrepreneurs feel like they're stuck and spinning their wheels and can't move forward because they're spending all of their time on this invisible thing called getting the team to move forward. But there's no system or structure or process around it that they can push and lean on and make better. When you create a communication system, a structure, a cadence, everything in your business will change.
Here's what you need to know about creating a communication structure. Number one, and this is important, it has to be predictable and it has to be absolute. Here's what predictable means. Predictable means, every Monday at four o'clock central, my entire team gets on a call and we do our weekly planning with the team.
That same Monday at 2:00 PM, I'm in with my leadership team doing a leadership weekly planning meeting so that we can understand where we're applying our resources for the week. Every day at 9:27, my team gets on for a huddle that takes anywhere between 12 and 25 minutes and everyone connects. They know where we're going, they understand what happening, we update all the scoreboards from the day before. It is predictable.
Then the second step is, it's absolute. Here's the last thing I will ever do, cancel a meeting with my team. If I can't be in a meeting, then my team holds it anyway. If we have a targeted interaction set up, it's going to happen. It's absolute. Cadey and I have been running businesses for over 10 years and in that entire time, we've never missed a daily huddle except for once.
There was one time where I was driving into my office and I got behind. I got on a call, I had to take the call walking in. The huddle was about to start. There were some things I wanted to tell the team, so I said, "Hey, let's delay it." They call that I was on too way too long and it actually had to go from one call to another because there was kind of a challenge within the business. I was in my office. I kept waving people away because I was on the phone. By the time I got done, instead of 9:27, it was about 11:30 or 12, and so we just made the decision not to do the huddle.
It was by far one of the least productive days we'd ever had in our business and by the end of the day, I had multiple people come into my office and say, "Hey, let's not do that again. Today was weird. Today was uncomfortable. Today was unsettling. We didn't understand what was going on. We didn't have the huddle. We didn't connect in the morning. We don't ever want to do that again." Since then, we never have.
When you create a communications cadence, when you have meetings with your team, I want you to understand something. Those are the most important meetings you have. Entrepreneurs will cancel meetings with their team for just about anything, for a sales call! You set up a meeting with everyone on your team, the people who are helping you make your dreams a reality, and then you cancel that meeting with them so that you can get on the phone with a single client.
That is so challenging to your team and they will feel the disrespect because let's be real, that's what it is. They will feel the disrespect that you've shown them and they will also feel like they're not important. I want your team to feel leveraged. I'm want your team to feel clear. I want your team to be excited. I want your team to feel like they're important. You do this by making your communications cadence predictable and absolute.
Second, it's understood and it's scheduled. That means part of the onboarding for people on our team is understanding the communications cadence. When they're going to be in targeted interactions, when they're going to understand where we're going as a company and what our goals are, when they're going to understand what our monthly results were.
Every member of our team understands when they're going to know these things and we have our targeted interactions on the schedule way in advance. Annual planning is on the calendar for six months. Our 90 Day target meetings are on calendar for six months. They are there for a long time. Here's why. When I say that it's absolute and it schedule and it's understood, people don't take time off when we are doing our major planning meetings in our company because the cadence is that important.
Then the last step is, it's repetitive and clear. When I say repetitive, entrepreneurs get uncomfortable, they get frustrated, they get irritated, they start squirming. They don't want to do repetitive things, they don't want the same meeting on their calendar. I already mentioned that, but you know that's how we feel.
But here's why so many of our clients, hundreds of companies have installed a repetitive, absolute, predictable, scheduled communications cadence. Because after a short period of time, you see everybody on your team actually get better. You start realizing that the gotten minutes and the interruptions you used to have have gone down to an absolute minimum.
If you don't want your team interrupting you, if you don't want your team coming in and asking you questions, if you don't want the constant stream of interruptions, create a communications cadence where they know where they'll have their questions answered, where you're going to connect with them, where they have one-on-one time.
If you do this correctly, you can go from that massive number of 1000 to 2250 hours a year to an hour system, we drive that down to about 300 hours a year, including preparation for every targeted interaction you're going to be in to keep the company moving forward. That's why when so many companies get into our system and start using it, their businesses absolutely explode.
Our communications cadence changes how the team works. It increases trust between you and the team, it increases visibility from you to the team, and it lets them know exactly where you want the business to go because they're hearing from you in a way that they actually comprehend and retain.
Here's the results you will get if you install a communications cadence in your business. Your team will be aligned, your issues will go down, and your momentum will go through the roof because when people understand what's going on, is when they give you their full attention, their full commitment, and they go all in. But when they don't, it's really hard to get anyone to do that.
People will not walk into a fog. Psychologically, they will not walk into a place where they don't understand. You may be paying a team member to sit at their desk idly waiting to hear what they should do. When you have a communications cadence, they will always know what they can do to move the company forward, achieve their goals and create momentum. Communications cadence will absolutely change your business, but it'll also make you a better entrepreneur, give you better perspective and help you create the momentum you absolutely know you want.
If you're ready to start changing this in your business and you want to install a communication cadence for your company, go to billionairecode.com. Three things will happen. One, you can give us your first name and your email and on the first page we will make sure that we email you a copy of our eBook, The Billionaire Code decoded so that you have the entire billionaire code matrix, which is the nine levels you go through from zero to $100 million in order to create entrepreneurial success.
Second, we'll give you an opportunity to sign up for a call with a member of our team, and you should. If you are in a place where you have a team that you want to communicate with better, if you want to create a strategic plan. If you want to, on a monthly basis, know which processes to document, which projects to execute and which people to hire, let us help you. You don't have to do this all on your own.
Go to billionairecode.com and let us show you how our communications cadence can make your team better at what they do, can make you better at what they do, get you all into momentum and start creating incredible outcomes and leave your den in the universe; billionairecode.com.