Episode 78: What Makes A Business Sustainable And Profitable, With Brett Gilliland
What You Will Learn:
- How organizational behavior is the study of how parts of an organization unify to create an outcome, and why all organizations are perfectly designed to get the results they get
- Why defining your Values is only the first step, and why developing a Leadership Model is the key to sustainable, profitable growth in your business
- How a Leadership Model and Leadership Brand help further define how your organization’s Values apply to your business leaders
- Why rapid growth can cause you to risk bringing the wrong people into your company who don’t fit with your Values, and why developing your leaders internally is crucial
- Why developing a Leadership Model can be a powerful growth catalyst for businesses in the $1-3 million range
- What work to do to fulfill the four elements of the Elite Leadership Model: Set the Vision, build the team, deliver results, and developing leaders with the right attributes
- Why, to be a truly great and effective leader, you must care about the well-being and success of the people you lead
- Why great leaders should learn how to enroll, inspire and engage the people they lead in a collaborative, participatory way, and why the old ways of “command and control” don’t work
- Why your business can only grow as far as the collective leadership capabilities of your leadership team
About Brett Gilliland
Brett Gilliland is Founder and CEO of Elite Entrepreneurs, a company that specializes in giving $1M+ business owners the knowledge, processes, and tools to grow to $10M and beyond. Brett is an expert in organization development, leadership, and strategy and spent 10 years helping Infusionsoft grow from $7M in revenue to over $100M. Brett was involved in the foundational work of Purpose, Values, and Mission at Infusionsoft and facilitated the strategic planning process for many years.
One of Brett’s favorite professional accomplishments is co-creating Infusionsoft’s Elite Forum along with Clate Mask and building the Elite business inside of Infusionsoft. As the leader of the Elite business, Brett has helped hundreds of struggling seven-figure business owners overcome their biggest challenges and achieve new levels of success. He also played a central role in the development of Infusionsoft’s Leadership Model and was serving as the VP of Leadership Development when the decision was made to spin the Elite business out of Infusionsoft. As the new owner of Elite Entrepreneurs, Brett can’t think of anything else he’d rather be doing professionally. When Brett isn’t busy helping $1M+ businesses succeed, he is a family man who enjoys spending time with his beautiful wife, Sharon, and their 8 children.
- Elite Business Health Assessment: https://growwithelite.com/health
- Email: info@GrowWithElite.com
- Website: https://growwithelite.com/
Listen to the podcast here
Typically, I have an interview guest where we talk about things that matter to seven-figure business owners. Once a month, I spend some time sharing something that will be helpful to you. I want to tell you about the key to sustainable growth. I don’t think I’m exaggerating that point. I do believe this is the key to sustainable growth. However, it’s not very flashy or exciting. You are not going to find it in any of the popular business books out there. It is at the heart of your ability to make the shift from $1 million entrepreneur to $10 million CEO.
Before I share that, some context. Twenty years ago, I completed a Master’s program in Organizational Behavior. Organizational Behavior is the study of organizations, how they behave, and more importantly, how the parts of an organization come together to create an outcome or result. People and culture are at the heart of how an organization comes together to produce a result, but the organization also includes things like technology and processes, how decisions are made, how information flows, compensations, and rewards. You get the idea.
A lot of things go into making up the system of an organization, and your business is an organization. It’s a system. It’s like a living organism and there are all these parts in it that combine to get the outcomes that you get. I have shared this o overarching truth before, but it’s the main takeaway from two years of graduate school. I’m going to save you two years of tuition in business school, living expenses, and all the rest.
The main takeaway from two years of graduate school is captured in this quote by Arthur Jones, and it’s worth jotting down somewhere if you have a little piece of paper nearby, or if you want to type it out on your device or something. Here’s the quote, “All organizations are perfectly designed to get the results that they get.” Think of the implications of that statement for a minute. What it means is that you, me, and everyone else but for purposes of our time together, you have perfectly designed your business to get the results you are getting today.
You probably didn’t think of yourself as a master in Organizational Behavior but in a way, you are. You have set up the perfect system or organization to get the results you are getting today. You may not be happy with the results that you are getting, but you have set up the perfect organization to deliver those results. For your results, you are a master organizational design, organizational development, or organizational behavior specialist. You know what to do. If you like what you are getting now, congrats. If you are right where you want to be, then try not to mess up the delicate balance of your perfectly designed system.
I’m guessing some of you are tuning in to this show and saying, “I’m not happy with what I’m getting today and I would like to make some changes.” The reason I started to share about my graduate program is to tell you something I learned at one of our alumni events. Every year, the school would bring the alumni together and put together an event where there are networking and growth opportunities for everyone there, and they are great. These conferences are the best.
Over the years, the best of the best from our program would come back and share some of the things that they were learning and doing in the organizations where they work. These are the practitioners, not just the academics from the school. We went and learned lots of theories and lots of ideas, but these conferences were the place where we could get our hands on the work that people were out there doing in real life, right out in the wild, and bringing back their learnings and their best practices.
I don’t remember exactly what year this was. I think it was around 2009 or 2010, but I went to a session at one of these alumni events and was listening to one of the early distinguished alumni from this organizational behavior program. His name is Ralph Christensen. Anytime I got a chance to listen to Ralph, I was like turning up the listening skills. Everything that he shared came from years of him doing it in the workplace. He was a practitioner that I looked up to.
He had been the Senior VP of HR at Hallmark Cards for several years, and he moved to a new organization. In that organization, they decided that they would put together something that they called a leadership model. The thing that he shared that day is that the key to sustainable growth for your business is a leadership model. It was a result of several months of work collaborating with the leadership team where he worked, but he shared this leadership model.
As I listened to Ralph teach us what it was, how they created it, and how they used it in their organization, I knew I was having one of those moments in my life that was a life-changing experience. Have you ever had that where you hear something or experience something, and you know at that moment that it’s changing your future? That’s what this was for me. I knew immediately that I was having a life-changing experience.
As a business leader in the 21st century, if you haven’t heard someone talk to you about the importance of articulating the values of your business, you have probably been hiding under a rock somewhere. These are not new concepts. You need to identify your core values, and then you need to build your team around them.
This stuff is becoming more and more commonplace knowledge. Growth-oriented business owners like you know that they need to help their teams get clear on the values and then you should hire, lead, and fire to those values. It’s almost a given anymore, but most seven-figure business owners have never heard of a leadership model.
While the values become very commonplace where we need to do this like table stakes, having a leadership model is like that next-level thing. Most business owners still aren’t aware of this idea of a leadership model. I’m going to share with you something that was cutting edge, in my opinion, back in 2009 and 2010 when I heard it. In 2021, when I’m sharing it with you now, I have not seen this take a massive hold out there, especially not in seven-figure businesses.
Maybe in larger companies, this is a more typical understanding, but in smaller businesses, it hasn’t gotten that commonplace everyday ubiquitous knowledge level. It’s not something that everybody knows. Let me share about it. Much like the values provide clarity to everyone on your team about the behavioral standards of conduct or the predominant way of being around here, a leadership model captures the behavioral standards and attributes of leaders in your business.
Let me try to say that a little more clearly. The values help everyone know, “Here’s how we behave around here. Here’s who we are here for everyone.” The leadership model does that for the leaders. It’s like an add-on to the values. It doesn’t replace the values. These values are important for leaders too. The leadership model is in addition to the values. Here’s how leaders behave. Here are the things that they do and some of their attributes. We hire, lead, and fire everyone to the values in our teams, and we hire, lead, and fire leaders to the leadership model for our business.
Back to my story. I came back from this conference on fire. You can imagine. I already told you. I knew this was a life-changing moment for me. I could see so clearly why it was important for us to develop our leadership model. I excitedly told the CEO and his co-founder about leadership models and why it was essential for us to create one for our growing business, and they bought in. They helped shape our original draft. We shared it with the rest of the leadership team, and I felt accomplished. It was like, “We have a leadership model.”
It was awesome, but only one problem. No one was against the idea of a leadership model, but they failed to recognize the importance of what we were trying to do. Looking back, truth be told, shame on me for not involving the entire leadership team in a co-creative process to draft our leadership model with them. You will learn why that’s ironic later. I did involve the CEO and his co-founder. I have three co-founders, and so the three of us worked on this, but we didn’t involve the rest of the leadership team.
As leaders do, they get busy with the day-to-day responsibilities of leading their respective teams. We were growing fast and it was chaotic. The leadership model took its rightful place on the shelf of good ideas that never go anywhere. You know what that’s like. I’m sure you have one of those shelves as well. I went from being elated that we created this leadership model because I knew it was game-changing to being disappointed that it had fallen flat.
Two or three more years went by. Our business is now much larger. We have some new members of the leadership team. One day, someone on the team said to the rest of the team something like, “We need a standard for our leaders. Something we can use to measure how well our leaders are leading, as well as something that we can reference as we are looking for ways to develop future leaders.” You can imagine that I was all over that.
I said, “That’s a great idea.” Instead of saying, “We did that a few years ago,” and pulling the one off the shelf and dusting it off, we set out to co-create a leadership standard as a leadership team for the company, which was the right way to go about it. This time it stuck because we got all the right people involved, not just the two co-founders. I couldn’t have been more thrilled.
For the next several years, the leadership model communicated clear expectations for what it looked like to be a leader in our business. It’s the first time I’m introducing that idea, so the leadership model and leadership brand are probably two sides of the same coin. Values and brand for your company are very interconnected, but our unique leadership brand is now codified. We could hire, develop, and fire leaders against the standard this leadership model represented.
You have heard me mention on this show about the company where I spent this time. I spent ten years helping this company build from seven figures to over $100 million in annual revenue. That company was called Infusionsoft. They have since rebranded. The company is now called Keap. We had created an amazing award-winning culture. We set out to build a company to last.
The Jim Collins book Built to Last was our Bible. We said, “We are going to build this thing to last.” We were consistently growing from 40% to 50%. We were on those Inc. 500 and Inc. 5000 lists for 6 or 7 years in a row consecutively. We grow, grow, grow. We won the top 25 best small workplaces in America. We were doing it. It was awesome until we experienced some difficult challenges. Frankly, they were challenges that we brought on ourselves.
Guard The Front Door With Your Life
When I look back on those challenges and lessons we learned as we grew that company, there are two things that I would do differently if I could. I’m going to share those with you right now. I don’t think this detracts too much from our leadership model conversations. The first that I would do is I would guard the front door with my life. Saying with my life might be a tad bit exaggerated, but I’m attempting to communicate how critical it is to make sure everyone you hire, especially leaders, fits with the culture or fits with the team. They are in sync with the purpose and the values. They are the right people to help with the mission.Make sure everyone you hire, especially leaders, fits with the culture and the team, is in sync with the purpose and value, and is the right person to help with the current mission. Click To Tweet
We have to make sure that we don’t bring the wrong people in. We were growing so fast that we did. We brought some of the wrong people in including senior leaders who created some massive fissures in our foundation. There were some cultural dynamics that were off when we brought the wrong people in. That’s the first thing I would do differently if I could go back. It would be to ensure that we never brought people in who weren’t a fit with our values, especially key leadership hires.
Develop Leaders Faster
The second thing that I would do differently if I could is I would develop leaders faster than we did. We were forced to go with external hires for way too many of our leadership needs because we hadn’t developed enough of the leaders that we needed internally. We didn’t develop them. At first, we didn’t have a model for it, but later even when we did have a model for it, we used it more on the idea of developing leaders. We did it pretty well to evaluate the current leaders that we had. It was a little bit late in the game. We didn’t develop leaders fast enough for that leadership model.
That’s where this leadership model comes into play. If you have done the work of articulating what good leadership looks like, or more accurately, what it acts like in your business, then you can begin to develop people to that model. You can also use the leadership model to evaluate your leaders and work with them to make course corrections if they are veering away from your company’s leadership brand or to evaluate leaders that you may need to bring in from the outside. I’m not saying that you can develop every single leader you need for the next leg of your journey. If you are growing from $3 million to $10 million in revenue and none of the new team has ever been at $10 million, they don’t even know what it looks like.
Let’s say that they are growth-oriented and resourceful. They figure out how to go from $1 million to $10 million and your business is pushing that $10 million mark, they still don’t know what it looks like at $30 million the next stage of growth. At some point, you have to bring in enough outside leadership to help you see what the next leg of the journey looks like. If you hire too many of those key leaders from the outside, then your culture is at risk.
Elite Leadership Model
You need to be growing leaders from within as fast as you can and supplementing that with occasional key hires from the outside. For the longest time, I was of the opinion that in order for a leadership model to be effective, it’s like values. Every business is different. You have to go through the process of identifying your unique brand of leadership.
While I think that may be true when you get, big, let’s say north of $30 million or $100 million range. Maybe there’s a unique flavor of leadership that you want to preserve there. For most of us in the seven-figure business range, I’m very confident in recommending a generic set of leadership model elements that all of us can benefit from. After all, good leadership is good leadership. There’s not going to be that much variation.
You have two great companies or two great seven-figure businesses that are in that $1 million to $10 million range. What good leadership looks like in that range is pretty similar between those two companies. The labels and the behavioral descriptions may be a little unique to each business, but the core fundamental elements of their leadership models would be very similar in every business.
We have put together an Elite Leadership Model. It’s specifically designed for seven-figure business owners. I’m going to share that with you now. I want you to think about, “How do I develop myself as a leader and how do I develop and evaluate other leaders in my business so that we can have sustainable growth?”
For businesses in the $1 million to $3 million range, that stage of business, I would say the focus of our leadership model is primarily to help you as the business owner make the shift from scrappy, resourceful, and gritty startup entrepreneur to capable and confident business builder, $1 million entrepreneur, $10 million CEO. Even if you don’t see yourself as ever being a “CEO,” the point is not the title. The point is you have to stop being the ultimate doer or producer at the $1 million entrepreneur level. You have to be more of a capable business builder, and this leadership model will help you with that.
In the $1 million to $3 million stage, the model is primarily for you as a founder to get clear about the changes you need to make in leadership for yourself. For those of you in the $3 million to $10 million stage, the focus of the Elite Leadership Model is to assemble a strong leadership team and develop the future leaders that you will need as the business continues to grow.
Set The Vision
In our Elite Leadership Model, there are four elements that I’m going to share with you. Three of those elements describe the work good leaders do. The fourth element speaks more to who good leaders are or their way of being. You think about that as attributes. We will talk more about that later. Let’s talk about the first element of the leadership model. You know I’m a big fan of Jim Collins if you have been tuning in to this show at all.
Jim Collins says, “The number one responsibility of every great leader is to set the vision.” How could that be missing from our model? That’s the first element of our Elite Leadership Model. For each of the elements that I’m going to share with you, I’m going to give a few bullets of the work. What does it look like to do that set the vision work, for example? Let’s start with that.
What kind of work does a good leader do to set the vision? First, they articulate a vision with their team. Not for the team, but with the team. In other words, they get help from the team to get clear on the why, the what, and the how of their work. We do this in a co-creative way. That’s why I said earlier, it’s ironic that my first pass at bringing a leadership model to our business was a flop. It’s because I didn’t do the co-creative process with all of the right people or with enough of them. That only happened with the two co-founders. While they thought it was a good idea, we didn’t bring the rest of the team along the right way. Good leaders who set the vision correctly use a co-creative process to articulate a vision with the team.
The second piece of work under the element of setting the vision is to create a plan to execute that vision. That’s not enough to articulate the vision. Now, we have got to create a good plan to execute. That includes things like strategy and identifying resources needed. It may include things like designing processes that need to be in place or putting new processes in place to be able to execute that vision, but there’s a plan around how we are going to get it done.
The third thing that a good leader does to set the vision is more of an ongoing responsibility. Once that vision is set and we have a plan to execute, then the leader must champion that vision through to completion. In other words, it’s the ongoing work to enroll and inspire the team to make it happen. Articulate a vision with your team, create a plan to execute that vision, and then champion the vision in an ongoing way, and enroll and inspire people along the way.
Build The Team
Those are the three pieces of work that a good leader does to set the vision. It’s the first element of our Elite Leadership Model. The second element of the Elite Leadership Model is to build the team. What are the three pieces or bodies of work under building the team? The first one is to organize the work. This is a little bit different than creating a plan to execute the vision. It’s more around making sure that individual team members know what’s expected, how it will be measured, and how it aligns with the plan. It’s organizing the work. Think about an organization chart.
How are we going to organize ownership of work, and how are we going to give people clear ownership with accountability for pieces of that work? That’s the first one. The second thing under build the team is to assemble a winning team. Once you know what the work is, how do we put the right people to it? We are going to gather the A-players that you need to get the job done. The third part of building the team is the ongoing work of growing or developing the people that you have.
It’s not always go and hire somebody from the outside when you need something done. We are also growing our team. As an aside, we love Liz Wiseman’s work on this topic. If you haven’t read it, I highly recommend you check out the book Multipliers. It’s about this idea of unlocking additional potential and multiplying the ability of an individual, so growing or developing people. Check out that book Multipliers.
Under the element of building the team is organizing the work, assembling a winning team, and growing or developing the people that you have. Those are the three chunks or bodies of work under building the team. The third element of our Elite Leadership Model is called deliver results. That may sound obvious, but it’s not all set the vision and build the team. Now we have to get it done. I recognize that parts of these have overlaps. They overlap with each other, but that’s okay. We are trying to create distinction so you can see more clearly what it means for you to become an effective leader and what it means for you to develop other great leaders for your business to have sustainable growth.
These are the three buckets of work under deliver results. The first one is about understanding what it looks like to win. It’s identify, measure, and report KPIs. Most people know that stands for Key Performance Indicators. I’m not trying to call you out if you don’t. There’s a new term, KPI or Key Performance Indicators. Some people might call them key results, activities, objectives, or goals. Whatever you call them, figure out what winning looks like so that the team knows that. We know what winning looks like. This is the first part of delivering results.
The second bucket of work under that is to create a culture of performance and make necessary adjustments along the way. We know business is chaotic. We know things change, but that isn’t an excuse for not getting the job done. If we set a course and we say, “Go team,” and something changes and we are not achieving, then we need to be aware of that, but we need to not be okay with that as a team.
We create a culture performance that says no. When we set goals, we figure out a way. We make necessary adjustments when obstacles happen, when our environment changes, or whatever it is. After we know what winning looks like, we create a great culture or a positive culture around performance and winning.
Great sports teams do this. I don’t need to veer off and do a whole thing on winning sports teams, but they know what winning looks like. They create a culture or chemistry on the team to make winning results happen. Thirdly under deliver results is what we call hit your numbers. Good leader leaders figure out how to lead their teams to declare and accomplish the right goals. We don’t just know what winning looks like and create a great culture, but we deliver the results.Know what winning looks like and create a culture, a chemistry on the team, to make winning results happen. Click To Tweet
Those are the three elements of our Elite Leadership Model. Set the vision, build the team, and deliver results. You might be saying, “That’s what leaders do,” but I bet you didn’t have a nice framework for thinking about what a good leader does, and it doesn’t have to be unique to your business. I thought that for a long time. We have to have our flavor of leadership. How many flavors of good leadership are there going to be out there? You might not like the way that we have labeled these. You could change some of the labels and some of the descriptions, but the core essence of your leadership model as a seven-figure business should be to set the vision, build the team, and deliver results.
Who Are You As A Leader?
Finally, the mysterious fourth element of our Elite Leadership Model. It’s less about what leaders do. It does show up in their behavior, for sure, but it’s more about who they are. They are more about their attributes. You can think about this as qualities of a leader or characteristics of a good leader, not just the work that they do.
For us, we stuck with three things in the attributes element of our leadership model. The first one is that they must be living examples of the values in your business. They must be passionate about the purpose of your business. They are the poster child. A good leader in your business is the poster child for the purpose and the values of your business. I hope that it makes intuitive sense.
In other words, as we said earlier, we are not replacing the values. We are adding to the values and these leaders. Living your purpose and values needs to be at the heart of your leadership model, or else all this falls apart. If you say that purpose and values matter in your business and any one of your leaders is not living that way, then everybody on their team is saying, “They don’t mean it. They say this is important, but our leaders aren’t living that way.” These people have to be the living examples. They have to champion it. They have to teach it, but the values and the purpose are right at the heart of these attributes of a great leader in your business.
The second part of this is that they need to genuinely care about the people that they lead. If you are holding this up as a mirror moment for yourself, you need to genuinely care about the people that you lead. We can’t see people as objects. We can’t see them as a necessary evil. I hear business owners all the time talk about how employees equal headaches. More employees, more headaches. We can’t see them that way if we want to lead well. If we want to have sustainable growth in our business, we have to level up our own leadership. Right at the heart of it is that we genuinely care about the people that we lead.
If you struggle with this or you want some great resources to help you develop other leaders on your team, the Arbinger Institute is outstanding with this material. They have written a few books over the years. All of them get the same material, but they are either from a different angle or an updated version. The Anatomy of Peace is the individual version of this. Leadership and Self-Deception. Maybe you have heard of that book. That’s the leader of the business application of what they teach. They came out with a book called The Outward Mindset, which is probably like Leadership and Self-Deception 2.0. It’s like the newer version of their material for a leader in a business context.
I highly recommend the Arbinger Institute for understanding how to see people as people and not objects, how to increase genuine care about what matters to others, and how to lead them effectively. Lastly, under this attributes piece is something I have talked about already throughout our episode. It is that you do it in a way that enrolls others through a co-creative process.
Great leaders for your business will learn how to enroll, inspire, and engage people. We are beyond the point of command and control environments. We are beyond the point of dictators working very well in the business context. We have evolved. We have progressed a lot in the business world over the last 20 to 30 years and even before that.
We don’t even talk about the Industrial Age anymore because we know that wasn’t a good way to lead. Sometimes, especially in our seven-figure businesses, and this is part of the shift, we see ourselves as knowing all the stuff in the business. If we don’t do it or if we don’t make the decision, it’s not going to be done right. We have to make that shift if we want to scale our businesses. If we want to build our business, we have to be able to organize work.
We have to set the vision, build the team, and deliver results through people with people. Not see through them like objects, but with them like people, like co-owners in the work that we are doing together. That’s the third part of the attributes that we are going to prescribe as part of the Elite Leadership Model.
Let me try to put a neat bow on our time together here. Your business can only grow as far as the collective leadership capability of the team. At the end of the day, all of your challenges in business are leadership challenges. As soon as you figure that out, life is going to get a lot better for you because you are going to realize, “I have a lot more control as a leader on all of these problems than I thought that I did.”Your business can only grow as far as the collective leadership capability of the team. Click To Tweet
When I was in my entrepreneurial mind and I thought I had to do it all myself, it was overwhelming. I couldn’t possibly get it all done. As a leader, I recognize it’s my job to help other people understand where we are going, build a great team, and set up the systems and processes to predictably deliver results. Now I’m coordinating thoughts. I’m coordinating focus. I’m coordinating efforts, and I can relinquish control to others. That’s a powerful moment when you make that shift. Until you do that, your business will be capped at what you can lead and manage on your own. Once you start relinquishing control, there’s more leadership in the business that can move the business forward.
I hope you will use what I have shared about the Elite Leadership Model as a lens through which you can evaluate yourself and develop yourself as a leader. When you feel like you are on that path, squarely, that you are developing and evaluating yourself by these standards of setting the vision, building the team, delivering results, and with the right attributes, you can use the leadership model as a way to assemble and develop the leaders that your business needs to continue to grow.
You are going to need to develop a strong leadership team. You will need to hire leaders from the outside occasionally as we talked about earlier. This lens of the Elite Leadership Model now gives you some clues about what to look for and some intentionality about how to develop leaders. I know I haven’t answered every question about how to develop leaders today. That wasn’t the intent, but I wanted to unlock for you this power of understanding that our businesses can only grow as far as our collective leadership capability can take us.
An Elite Leadership Model will give you a wonderful lens through which you can assess and develop leaders, and increase the likelihood of achieving your growth objectives. If you want help with that shift that you have to make as a leader from $1 million to $3 million in revenue, that’s all about you figuring out how to make the shift. If you want to help with the shift from three $3 to $10 million, you are in the right place. This is all we do. All we do is help seven-figure business owners learn how to do this shift.
It’s not all about the leadership model. There’s also a set of processes, systems, and mechanisms to use in your business to be able to help it grow, but the leadership model is right at the heart of it. You can learn more about how we help seven-figure businesses on our website at GrowWithElite.com, and you can get started there.
We’d be happy to help you with this shift. It’s something we have helped hundreds of other business owners like you do. Whether or not you get our help, please leverage what I have shared with you in the Elite Leadership Model to think about ways that you can improve your leadership and enable the future growth of your business.
I hope you will keep tuning in to the show. Next time, we will have more interviews. We will have an interview with another great guest to help you in your seven-figure growth journey. I invite you to subscribe, share, like, and do all the things with this show so that you can help other business owners like you get the benefit that we are trying to share with as many people as possible. Thanks for tuning in and we will see you next time.
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