Season 3 Review of the last 4 Conversation with Steve Sandor

In this episode of Reclaiming the Joy of Business, host Steve Sandor reviews the insightful conversations with four business owners navigating the complexities of building and growing successful enterprises.

Steve emphasises the importance of strategic decisions, the emotional challenges of letting go of control, and the necessity of fostering a supportive company culture.

He discusses the significant impact of rapid growth on team stability, the importance of aligning leadership roles with business evolution, and the need for transparency and self-reflection in addressing personal and organisational weaknesses.

Steve also highlights the crucial role of training and empowering teams to ensure business sustainability and value.

The review offers practical steps for business owners contemplating succession, demonstrating how a well-prepared exit strategy can lead to greater business value and personal fulfillment.

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Transcript

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Steve Sandor (OD) 0:02

Welcome to Reclaiming the Joy of Business where I have the privilege of speaking with business owners who are facing the same challenges as you. My guests are building a successful business. The conversations focus very much on not just their success, but the decisions that have influenced the direction and strategies they have made. If you've been listening to this podcast for a while, you'll have heard me say this many times. Mistakes are only decisions that are made with not enough information, more information, different decisions. Not better. Just different. and it's because of these lessons that the owners can course correct. So in this third series of the podcast, my intention is to have conversations with three or four business owners and a subject matter expert, and then one of these solo episodes for me to focus on the lessons from each of the previous episodes. So you'll be my guest for the next 30 minutes or so. My business, as you know, is providing business advice to family owned businesses who are in their twilight period, where the owner is starting to think about the future beyond their current lifestyle. There are plenty of challenges for this cohort, not just in maximizing the sale value of the business Over the next five years, the number of baby boomer and Gen X business owners who will be retiring is staggering. It's known as the silver tsunami. This is important to every business because there is the obvious threat to the downward pressure that supply and demand will have on the valuations of all businesses, And there will be opportunities as well that will be presented to the market for entrepreneurs to take advantage of those businesses that are not yet prepared for the tsunami. The elephant in the room is how the family business owner deals emotionally with an exit. This is the fear that surrounds the concept of not having an attachment to something of meaning. I cover this and other topics in the words of Wisdom newsletter that I send out each week. So if you'd like more information on that, you can subscribe to the email version or via my LinkedIn page. I'll leave connections to both in the show notes. Robert Boschetti, Carlyn Cooper, Jussi Karjalainen and Josh Saunders are all. at the other end of the business spectrum in that they are in the early phases of building their business. And the reason I've chosen to focus on this cohort is that these are the people who are likely to be buying your business. They are the younger generation still prepared to work hard and make sacrifices, but are doing it for a lifestyle and purpose in mind. so I'm listening to how they are creating their business because as I help you plan your business, exit the strategy will need to reflect a strBoschettiture that considers lifestyle impact and purpose as well as profit. So let's get started on the key points of these discussions. One area of concern that I see business owners feel or fear is the concept of letting go of control. They're told you need to let go. I don't agree with that. I've said this many times. I think you need to be in control, but you can be less controlling and that builds a self-sustaining team. For family business owners preparing for succession or exit, the fear of letting go of both control and the hands-on role is a major shift in how the business is run. This is often coupled with the anxiety about whether the team can maintain standards, culture, and value without the founder's daily involvement. Addressing the issue is essential for a successful, valuable, and an emotionally satisfying transition. Carlyn made some comments in our conversation, and these were, and I'll quote, I, I always worried about how we maintained a standard that I felt was necessary, and she went on to say that, to mitigate that. How can we make sure that we provide the best standard of training for our team, and how can we make sure that they're the most competent clinicians? So that changed her strategic thinking because to enable retention and good consistency of her team, she needed to think about how to service her team so that they could focus on the clients. And as much as Caryln loves the clinical work, she realized that her role as the leader had changed and she needed to focus on training processes, not the clients. And so Carlyn's experience highlights the emotional and operational challenge of moving from doing to leading. The fear of losing quality or reputation is real. But the solution lies in investing in team training, clear standards, and shifting the owner's focus from clients to empowering staff. I know that empowering is an overused word today, but it does describe what needs to be done. For succession this is critical. A business that depends on the owner's personal touch is not ready for a transition. One of the things that Jussi Karjalainen mentioned was the owner's involvement as either the specialist or the builder of culture and leadership. And this is where Jussi mentioned the alignment of his role as managing director to the activities that he was engaged in. And he mentioned that he applies for his job every six months, which I thought was a fantastic concept. And it's understanding that as the business grows, so does the role of the leader. And he said, I may not be the best CEO for the business as it evolves. There might be a day when somebody else would do a better job than I, and I want to be in a position to make sure that I've seen that for myself. Jussi's Insight is a powerful reframe. The owner's job is to make themselves easy to replace. This means building a culture and leadership team that can challenge question and ultimately surpass the founder's own capabilities. For most business owners, this is both a practical and emotional hurdle, but it's the foundation of a business that can thrive through succession. Let's get back to one of Caryln's comments where I asked her what are some of the mistakes that you made? And she made the comment that during the pandemic, her business grew and the focus was on dealing with the demands of the clients. And this growth placed a lot of pressure on the staff to deal with the reframed work situation and the additional client pressure. And Caryln said, I would've probably done it more strategically. And considered the impact that the growth had on the team. my thoughts weren't communicated consistently, and I think I have a lot in my head, but sometimes I didn't clearly communicate what I'm thinking, where we are going and what we are doing. I might be three steps ahead, but everyone else is still using the existing processes and seeing the children, And I think that's a common theme amongst creative, entrepreneurial business owners and that unplanned or reactive growth, the opportunity that is presented to them and they're keen to take advantage of that opportunity, but without a clear strategy for the team to develop that opportunity or it's poorly communicated that can destabilize a business and erode the joy within the business. Carlyn's example is not uncommon when the owner is ahead of the pack seeing and creating opportunities, and the team is trying to create a workable framework to deal with the growth. And when I've worked with businesses, this is the most frequent criticism by the staff of the owner. My comment is always that this dynamic or tension is why the business is successful, and when there's a process to build a bridge over the chasm of creativity with thoughtful processes and a common language This enables the owner to be creative and the team to create the mechanism to keep up Robert Boschetti made a really interesting observation of the reflection of him onto his business, and he said all the things I was good at, our company was good at all the things I was bad at, our company was bad at. and this is exacerbated as the business grows, The good bits get bigger and the bad bits get bigger. And the challenge with that is acknowledging the harsh reality that the bad parts of your own personal expression are exposing the company. This is brutal. It's hard, and it takes years to learn about yourself. And Robert mentioned the goal of continually looking for improvement was how he overcame this particular, let's call it a fault or failing in the personality, But it was Robert's honesty about how a business amplifies both the owner's strength and weaknesses. That is the crucial lesson. It's the acknowledgement of that, and for succession, it's not enough to focus on what's working. Owners must also confront the, and address their own blind spots and failures and build systems and teams that can compensate and improve on them. I would say having a culture that allows for alternative views is as important as having systems and processes. This is the path to a business that truly is ready for the next generation. One of the areas that I think is common amongst. Most business owners is the emotional toll of, am I good enough? And Jussi shared some very personal self-doubt that came about as a result of his not achieving the goals when he first started the business that he had set. And this was demoralizing as he was questioning his own judgment of starting the business and whether in fact, he may have been better off staying where he was as an employee. He was being supported by his wife, but she also held the torch to his feet and gave Jussi a gentle shift along, and this focused his attention on a timeline. To be accountable. A few things about this. Firstly, there is no shame in being honest about a negative situation. In my experience, when you are transparent, that's when people show up to help. being open and transparent allows people to think about how they might be able to help. There is an interesting psychological position in the minds of family business owners that they have a greater financial responsibility to their family versus that of an employee. And when you say it like that, it's obviously not true My view is that business owners feel that they have to have all the answers, resources, and have a deep feeling of responsibility to all the stakeholders. On the other hand, someone who is an employee can lean on the resources of the organization and the entity itself has ultimate responsibility. Jussi's story is just a reminder that we as business owners need to be kinder to ourselves. Business is simple, but it's definitely not easy. It is a reminder that resilience, transparency, and a willingness to be held accountable are essential qualities of all owners. Josh Saunders brought up my favorite topic, which is culture and I talk about creating a business village culture, and for family business owners preparing for succession or exit. A strong, supportive organizational culture is a key driver. In the business's value. It also contributes to staff retention and a legacy. It ensures the business can thrive without the founder's daily presence and attracts both successes and buyers who value a positive, resilient workplace. Josh said, I always tell everyone who works for me family first. he went on to say that he tells his staff, if you've gotta be somewhere to be there for your child, do it. Don't think that at an hour of working for me is more important than being there with your child. He went on to say that they were really family first, and you'll always be able to come to work tomorrow and do more coding for Log Master. But if it's a play or if it's a recital or some school activity, go and do that instead of being here. We understand that's important, and the businesses that I've worked with have that sort of family feel about it. This explicit prioritization of family and life outside work is a powerful cultural differentiator. It doesn't mean you accept poor performance or behavior. Family owned businesses who embed these values not only supports staff wellbeing and loyalty, but also makes the business more attractive to future leaders who increasingly value work-life balance, and it's a legacy that goes beyond the profit. Josh also gave the example of a developer they employed very early on who's based in Mongolia, living in a yurt with his wife, children, and her parents. Now, a yurt is a tent. I thought it was a form of a yak. Um, I need to get educated And over time because of the opportunity given to this developer, he was able to save enough money to buy a house for him and his wife and children. He bought his in-laws, a house. He bought a car. He's now studying overseas, all because of the opportunity that Josh gave this individual. Leaving aside the fact that the employee lives in a developing country, the concept of providing an opportunity for people to join your purpose of the business to deliver exceptional service is a very valid position to take in a country like Australia. The business owners I've worked with over the years whose mindset is to be focused on success, have an innate pride in their own achievements and are supportive of their team because they understand that to be impactful, there needs to be a common commitment to a purpose. And the purpose may not be a formal statement, but it's definitely in the DNA of the business and what I call the business village culture. So the key takeaways from these four conversations I had with these really dynamic business owners was For family business owners thinking about succession or exit, a significant challenge is letting go of control and trusting their team to maintain standards and culture. This fear is understandable given the owner's deep involvement in the business. The owner's role needs to evolve from being a specialist to becoming a builder of culture and leadership, and the goal should be to make oneself easy to replace by empowering, there's that word again, the team. A rapid growth without a strategic focus on team support and communication can lead to burnout and instability. Thoughtful leadership and consistent communication are crucial. A business often mirrors the owner's strengths and weaknesses, and these are amplified as the business grows and owners need to address their blind spots for successful transition. And the transition process can bring about an emotional toll and self-doubt for the owner. Transparency and support are important during these times. And finally, creating a cultural supportive organization is vital for business value, staff retention, and a lasting legacy. This includes prioritizing, family supporting wellbeing, and fostering a sense of purpose. By taking this approach, what I've seen is that businesses increase in value and are more attractive to successes or buyers. It reduces the personal stress of the owner as well as their staff And a renewed sense of joy and the preservation and enhancement of the business, legacy and culture. here's a couple of practical steps that you might be able to take. start by looking at how you can invest in your team's training and development to ensure they have the skills and competency needed to firstly uphold your standards as you step back, and this will build confidence in their abilities. Reflect on your own role in the business and begin to shift your focus from day-to-day tasks to building a strong culture and empowering your leadership team. Think about how you can make yourself easy to replace. and finally, take an honest look at both the strengths and weaknesses of your business, recognizing that these often reflect your own, And. Identify the areas that need improvement and build systems, and a team that can compensate for any shortcomings. I hope this information was informative and valuable, and food for thought as you plan your exit or look for ways to be less involved in the doing and being more strategic. If you like what you heard and you are not already a subscriber, please subscribe as it helps with the algorithm. And if after listening to this you are thinking I could do with some help, you might be planning your exit or looking to increase the value of your business, or not thinking about selling, but you like the concept of being the leader of an enterprise rather than having a job and like the thought of creating a business like Josh. Jussi, Carlyn and Robert, then use the link in the show notes to book an exploration call with me where I'll invest 60 minutes of my time in your business. It's on me, and let me help you reclaim the joy of business.