The Practical Optimist: An Entrepreneurial Journey Through Life's Turning Points 9781642255812

Table of contents :
Testimonials
Half-title page
Title page
Copyright page
Dedication
Contents
Introduction | My Personal Turning Points
Chapter 1 | The Practical Optimist
Chapter 2 | It’s Okay to Be Human
Chapter 3 | Know Your Values
Chapter 4 | The Courage to Challenge the Status Quo
Chapter 5 | Transparency Brings Teams Together
Chapter 6 | Why Leaders Need to Stay Connected
Chapter 7 | Winning with Perseverance and Resilience
Chapter 8 | Diversity Does You Good
Chapter 9 | The New Abnormal—or Don’t Let a Good Crisis Go to Waste
Conclusion | It’s a Wonderful Life
Acknowledgments
Endnotes

Citation preview

 

PR AISE FOR KEN SCHMITT AND T H E P R AC T I C A L O PT I M I ST “I have had the pleasure of partnering with Ken for several years in my former Human Resources executive role for a large global automotive organization. His approach to building a strong relationship and connection right from the start is refreshing and meaningful. As he describes throughout e Practical Optimist, Ken and his team are focused on building long term relationships through transparency and an incredible work ethic, making their clients feel like they are the only thing that matters, and I would choose that any day of the week!” JENNIFER PIKOOS Global Human Resources Leader, Level One Consulting Group

“Ken has created a guide for entrepreneurs that is fresh, current, funny, honest, straightforward, and helpful. His work ethic, sense of humor, and professionalism make him an ideal partner for achieving success while having fun, and these values shine through in e Practical Optimist.” RON GEREVAS Professor, CSUSM, former Partner, Heidrick & Struggles

“Ken’s ability to yield the best from his team stems from being inquisitive and introspective, with impeccable EQ. As he describes in e Practical Optimist, being a true leader is all about bringing out the best in your team, and Ken’s natural aptitude for teaching and

coaching allows his team to be challenged while expanding their skills. I have never been more impressed by a leader.” DANIELLE MATHIS Head of Talent Acquisition, Clari

 

Copyright © 2023 by Ken Schmitt. All rights reserved. No part of this book may be used or reproduced in any manner whatsoever without prior written consent of the author, except as provided by the United States of America copyright law. Published by Advantage, Charleston, South Carolina. Member of Advantage Media. ADVANTAGE is a registered trademark, and the Advantage colophon is a trademark of Advantage Media Group, Inc. Printed in the United States of America. 10  9  8  7  6  5  4  3  2  1 ISBN: 978-1-64225-582-9 (Paperback) ISBN: 978-1-64225-581-2 (eBook) LCCN: 2022921020 Cover design by Hampton Lamoureux. Layout design by Analisa Smith. is publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional services. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. Advantage Media helps busy entrepreneurs, CEOs, and leaders write and publish a book to grow their business and become the authority in their eld. Advantage authors comprise an exclusive community of industry professionals, idea-makers, and thought leaders. Do you have a book idea or manuscript for consideration? We would love to hear from you at AdvantageMedia.com.

 

To Mom and Dad, the best mentors an entrepreneur could ever have.

 

CONTENTS INTRODUCTION

My Personal Turning Points

CHAPTER 1

The Practical Optimist

CHAPTER 2

It’s Okay to Be Human

CHAPTER 3

Know Your Values

CHAPTER 4

The Courage to Challenge the Status Quo

CHAPTER 5

Transparency Brings Teams Together

CHAPTER 6

Why Leaders Need to Stay Connected

CHAPTER 7

Winning with Perseverance and Resilience

CHAPTER 8

Diversity Does You Good

CHAPTER 9

The New Abnormal—or Don’t Let a Good Crisis Go to Waste

CONCLUSION

It’s a Wonderful Life

ACKNOWLEDGMENTS

 

INTRODUCTION

My Personal Turning Points

M

aybe I shouldn’t admit this, but the movie Jerry Maguire always makes me tear up.

Now this isn’t because I have some weird emotional attachment to Tom Cruise, Renée Zellweger, or sports agents in general. It’s because of one particularly memorable scene. Jerry Maguire, as played by Cruise, is invited by his boss, played by Jay Mohr, to eat in a crowded restaurant. Inside that eatery, his boss unexpectedly and brutally res Maguire, knowing he won’t make a scene in front of a crowd. is affects me so strongly because the exact same thing happened to me. In 2005, I started working at a small boutique recruiting agency in San Diego. e business was owned by Fred,1 someone who allegedly wanted to retire in a few years. Our arrangement was that when he was ready to step aside, I would buy him out and take over. So we worked together toward that outcome. At rst, everything was very amicable. We came to an agreement on a valuation for the company, our CPAs got the ball rolling, and I was going to take out a second mortgage on my house to nance the deal. Until there was no longer a deal.

In 2006, Fred suddenly changed his mind. He said he thought he could get more money from a different buyer and didn’t want to sell to me after all. I stayed on and did my job, same as I had been doing, but our relationship quickly became awkward. Fast-forward to March 2007. He decided he wanted to get together for a performance review. is was my initial indication of trouble—it was the rst time in three years I ever had a review. My second indication of trouble? He wanted to meet at a restaurant so that we could do the review over lunch, and he certainly wasn’t someone who would normally take his employees out for a meal. It just didn’t feel right. As I was on my way out of the office to meet him, a coworker asked me what was going on. After I told him, I added as a joke, “Who knows? I might not be back—ha ha ha!” Except it didn’t feel like a joke as the laugh came out of my mouth. e restaurant was a casual lunch place. Very crowded. We sat down in a booth together, and I thought to myself, Hmm, I wonder why he’s not making eye contact with me? And then he dropped the bomb: when the server came over to get our order, Fred said, “anks, but we won’t be eating today.” at’s when I knew my suspicions were valid—I was being Jerry Maguired. He brought me to the restaurant so that I wouldn’t make a scene when he red me, which he did, quickly and harshly. His excuse? Exactly one email I had sent to a client that admittedly may have been a little too direct—this client was always asking for too much, and I decided I needed to push back a little. is might be considered a teachable moment by a strong leader. Instead, that was all he had as ammunition for this one-man ring squad. “I just can’t trust you anymore,” exclaimed Fred over our phantom lunch. I responded, “We’ve had two back-to-back record-breaking years while I’ve been here running things with you. How can you say you don’t trust me?” e reality was that there was no reason. He was just looking for an excuse to push

me out the door—he had already decided to lower my commission plan several months prior. And then, to add insult to injury, I ended up getting treated worse than Jerry Maguire. In the movie, his boss allows him to go back to his office for his things, including his all-important client list. At the office, Jerry immediately uses that list to begin calling his clients and asking them to stay on with him at the new rm he planned to launch. He even tries to get other agency employees to leave with him. All this happens while the boss watches. In my real-life nightmare, however, I would never enter the office again. He told me I had to wait until the next day to get my stuff—again saying I was untrustworthy. I responded by telling him this was unacceptable because all of my personal things were in my office, and I had every right to get them. I told him I’d be back that day at 6:00 p.m. after everyone had left. He reluctantly agreed. When I arrived after working hours, he was waiting to greet me, along with another guy—for protection, I guess, in case I somehow transitioned from Tom Cruise to Liam Neeson, seeking bloody, violent revenge. But, as anyone who knows me will tell you, that’s not really in my DNA. I just wanted to get my stuff and leave without any trouble. And they made that very easy for me because they had lled up a box with my belongings and placed it at the front door, blocking me from entering. I was expected to simply pick up the box and be on my way, which is what I did. But wait, there’s more! He called me a day or so later, accusing me of trying to steal client phone numbers and craft a new business plan to start my own rm. “Of course the numbers were in my notebook,” I explained. “Over the previous two and a half years, I’ve been using those numbers to contact candidates and clients on my drive to and from the office every day.” And the business plan? ose were my notes detailing the changes I was planning to

make to his rm when I took over. All of these numbers and ideas were written in my personal notebook, which I kept in my personal computer bag in my desk drawer. at meant he had gone through my bag and read my notebook before he packed them up. Really classy! So there I was, suddenly without a job. Worse yet, my wife, Juliet, had stopped working six years earlier in order to take care of our two kids, Cory and Cass. In other words, I was the sole breadwinner, and as such, I was a little panicked. My rst thought was to replicate the position I had just lost—maybe I could join another recruiting rm as a minority partner? at’s when my wife gave me the best advice of my life. Despite the fact that we had just lost our sole source of income, she said to me, “You’ve thought about running your own business for a long time. You’re going to put the same blood, sweat, and tears into a company, whether it’s yours or somebody else’s, so why not own everything yourself and enjoy the full bene ts of having your own rm?” She was right, of course. I incorporated my new business on May 15, 2007. en, six months later, the Great Recession hit the housing and nancial markets hard as well as the economy at large. Had I taken out that second mortgage to buy Fred’s company, I probably would have had to le for bankruptcy. e recruitment business was suddenly in the toilet, and I would’ve had a huge debt to service. Instead, I ended up building my own business that I funded with $15,000 from credit cards. I successfully built the rm from the ground up because I didn’t give in to fear or desperation, I spent time thinking through and researching my options, and I listened to my gut and my wife’s very wise advice. Sometimes the worst situation can lead to the best outcome—if you are willing to see the opportunity, be con dent in your abilities, and take a calculated risk. e world is always changing and evolving. Disruption can

knock us back on our heels at any moment, particularly in these turbulent times. And while we can’t control those shocks of fate, what we can control is how we react to them. Turning points are sometimes necessary to shake us out of our comfort zone and help us grow, inside and out. ey can inspire and motivate us, helping to elevate our game and take us to a place we never thought possible. And sometimes bad turning points happen for a very good reason. I ultimately was so grateful that Fred red me when he did, because it was the best thing that could have happened. Yes, there was quite a bit of stress and angst launching my own rm. Yes, we suffered through some lean years. But I ended up with the opportunity to work with an incredible team, building a successful company along the way that’s still going strong today, with revenue of $1.3 million in 2021. As you’re about to discover, turning points have always been a big part of my life as well as my family’s. Each of us (like most of you reading this book) has had to deal with adversity at different times along the way. But my family and I have also orchestrated our own positive turning points by taking some audacious yet calculated risks, many of which paid off in life-changing ways. In the chapters to come, you will hear rsthand about how my family and I dealt with life’s good and bad turning points. I will share the self-doubt, second-guessing, inspiration, and, most importantly, risk tolerance and con dence that helped guide my decisions along the way. My goal is for you to nd some insights from my journey that will help you navigate your own turning points—the ones that come out of an abrupt change in external circumstances as well as the ones you generate yourself. Both types can lead you to live a life that’s more genuine and ful lling. I also hope to generate some laughter along the way. In fact, occasionally I will mention a movie I enjoy (like Jerry Maguire!) in order to make a point. I’ve

always been a huge movie buff, as evidenced by the 650 DVDs in my home, so I often use lms to illustrate my life experiences. roughout this book, you will see references to some of my favorite icks to help provide insight into my entrepreneurial journey. But what I hope most of all is that the real-life stories in this book will bring some new perspectives on how to deal with enormous change, especially when, at rst, the change seems overwhelming. It’s never as simple as turning lemons into lemonade. It’s more about listening to your intuition, being authentic, following your heart even when it seems crazy, taking big risks that could bring big rewards, and, most of all, being open to change, even when it’s forced upon you and you’re scared to death of what could happen next. Yes, turning points can be frightening. But they can also be gateways to personal growth and prosperity. Which is why I named my company—what else?—TurningPoint Executive Search. Finally, please don’t misunderstand me. I didn’t write this book to preach. Instead, it chronicles my fteen years of experience as an entrepreneur, thirty years as a husband, twenty- ve years as a father and thirty- ve years as a manager, as recorded in my personal journal entries. I look at this as more of a conversation, albeit a one-sided one, that I hope will inspire dialogue and re ection. With any luck, my decisions, both good and bad, might provoke you to think differently about your own life challenges. So here’s to your turning points—may they ultimately bring positive change to your life.

 

CHAPTER 1

The Practical Optimist

hen you face a powerful and pivotal turning point, your basic attitude toward life instantly comes into play. If you’re a cynic, you may ignore valuable opportunities that are sitting right in front of you but still pat yourself on the back for being smarter than everyone else. If you’re a Pollyanna, you may try to smile your way through a storm and get very wet. And if you enjoy emulating ostriches, you may just stick your head in the ground to avoid looking at what’s heading right for you, even if it’s an oncoming truck.

W

Your nature can’t help but shape your response to whatever life throws at you. So I think it’s important that you begin to examine how you deal with change by taking a hard look at your belief system. If you ask me what my philosophy of life is, I would say I’m a practical optimist: I approach the future, and major decisions, with a positive and proactive attitude, tempered with a dose of reality. In other words, I wouldn’t quit my job and empty my bank account to launch a business in an industry where I had no experience, no visibility into the demand for the product, no knowledge of how to sell, and no customers to leverage. What I would do—and did—is start my own company in a sector where I already had nine years of experience (even though I had never built and run a business before). You have to be an optimist to make the leap into business

ownership. But my decision was rooted in reality. I already enjoyed a track record of success in the recruitment industry, and I knew I had a talent and passion for that kind of work. I was scrappy, and based on my previous roles, I knew what it took to bring in clients while also handling 100 percent of the execution. If I didn’t have all that experience to draw from, it would’ve been too huge of a gamble—even for an optimist who happens to enjoy gambling. I’m awfully glad that practical optimism is my default attitude. Now let me tell you how I got there.

It Starts Early

Most people tend to emulate their parents, whether consciously or subconsciously. ey’re your rst real adult role models, and that’s a very powerful position. You can’t help but pick up habits from your mother, father, and/or guardian. It’s primal. I’m no exception—I inherited my practical optimism from my parents. But it took contributions from both of them to equip me with that balanced attitude. My dad, whose name is also Kenn, is optimistic and trusting (and also enjoys a trip to Vegas), while my mom, Valerie, is practical and realistic. You could call them Mr. Yin and Mrs. Yang for the way they balanced each other out. My father, born at the very beginning of the baby boom generation, has an immense pool of natural enthusiasm. Generally speaking, that was a huge plus in his personal relationships and business dealings, and it was a characteristic that made everyone around him want to follow his lead. However, it’s also caused him to trust some people a little too much. For example, he ended up working as a business consultant for a longtime friend. Although my dad saw a few red ags in their initial business relationship and his overall approach to

management, this guy had enough money to buy a small country. He spread money all over town and even owned a portion of a professional sports team. at made it all the more shocking when it turned out he had been defrauding his investors and employees left and right. He went to jail several years after my father terminated their working relationship but not before he stiffed my dad for $25,000! at’s what happens sometimes, when pure optimism goes wrong. Unbridled trust that people will always do right by you doesn’t always end well. On the other hand, that same enthusiasm has also served my dad very well. His energy, fresh ideas, and new perspectives tended to carry the day in many professional situations. is can-do, things-will-work-out attitude drove his career to new heights within the Jack in the Box organization, where he spent nearly thirty- ve years. Early on, my dad was recognized for his innovation, his willingness to treat his team as peers, and, above all else, his ability to take calculated risks. ese traits were so unique that it provided his boss with the con dence to sponsor my dad’s progression through his corporate career from manager to area manager to vice president and eventually to a franchisee. (By the way, the upside of having a dad who managed fast-food restaurants is that, when I was in college and couldn’t afford a meal, I always had more than enough free Jack in the Box coupons. e downside? When I had a medical checkup at the tender age of twenty- ve, the doctor discovered my cholesterol was 250!). My mom was just as brilliant and business-minded as my dad. However, as noted earlier, she was there to keep my dad from getting carried away with his overly optimistic ideas. Where my father’s attitude was “I’ll trust you until you prove me wrong, and taking a risk is the key to success,” my mother’s attitude was more like “I’ll trust you, but you better prove to me that I should—and my tolerance for risk is a bit more limited.” Maybe that contrast came from the

fact that my father was the youngest child in his household while my mother was the oldest and had to deal with more responsibility at an early age, especially given that her brother was an incredibly gifted and free-spirited artist. Whatever the reason, she eyed the world a lot more skeptically than my dad. We still laugh about the fact that my dad would often reminisce about what he considered to be a great time in our lives while my mom would let some air out of his balloon by detailing why those “good” times produced some hardships as well—practical optimism at its nest! But even with that perspective, she added so much to all of our lives. My dad was the recipient of a great deal of wisdom from her. She would remind him that his professional decisions affected a lot of people, not just him, which forced him to think very carefully before jumping feet rst into a new endeavor. My wife, Juliet, bene ted from Mom’s insights as well, helping her adjust to living with an entrepreneur. She remembers a time, about a year after I started TurningPoint, when my mom took her aside and talked to her not as mother-in-law to daughter-in-law but as peers who were both married to highly innovative, entrepreneurial men who had big ideas and even bigger ambitions. My mom shared her experience going through tough times when she didn’t always understand why my dad was making some of the decisions he made. Her advice to Juliet was this: “It’s important for you to provide the voice of reason and to provide support for his ambitions at the same time.” Fortunately for me, Juliet has executed this strategy awlessly! My mom had her own entrepreneurial moments, believe it or not. After spending nearly ten years as an accountant—a position and career she never really loved but kept for practical reasons—she decided to leave that role to become a real estate agent. As time went on, she became an expert at attracting more and more clients, simply because she was so different from the other agents in the market. While some would try to oversell their clients,

encouraging them to buy a home that maybe wasn’t exactly right for them, my mom had the opposite approach. She was very honest and truthful about the positive and the negative aspects of any home she was showing. As a result, people trusted her, and she got a ton of referrals. We were a little surprised by her success, as we never pegged her as being in a sales role. And because she saw herself as a purveyor of information and a guide for her clients, rather than as a salesperson representing a product, she made her mark. It turned out that people were very suspicious of those who sold too hard, and my mom was the complete antithesis of the clichéd salesperson. And to be fair, she was far from a Negative Nancy. She was just realistic. When my dad was contemplating making a job change or a move to a different city, his focus was squarely on the best thing that could happen. My mom? While she didn’t ignore the best-case scenario, she would take a hard look at the worst thing that could happen, incorporating both scenarios into her decision. at enabled her to fully analyze the risk by looking at the pros and cons and then determining with my dad whether taking a gamble had a reasonable chance of working out. My dad appreciated her willingness to keep him grounded. And this approach was in full force when it came to raising my sister and me. In fact, one of the most powerful things my dad ever said to me about my mom was this: “I believe it was this balanced, protective yet nurturing, realistic yet supportive coparenting that created our strong family bond. At the end of the day, we were a united front and were there to support our kids’ decisions, whatever they were.” is effective approach to coparenting became even more apparent when I decided to launch my company. is was a dream of mine, inspired by watching my parents chart their own professional paths. While they both cheered me on and expressed their excitement, their rst response was “Haven’t you been paying attention? Have you seen how much stress we’ve had to put

up with owning our own business? Have you seen how difficult and insane this can be at times? Are you sure you want to do this?” I was sure. You’ve heard the question, Is the glass half full or half empty? It’s used as the litmus test to determine whether you’re an optimist or a pessimist. e reality is that it depends on your perspective and the context. anks to Mom, I knew that everything wasn’t sunshine and rainbows. anks to Dad, however, I knew you could shoot for the moon and that sometimes you’d hit it. And most importantly, my sister and I were able to bene t from both of their approaches, making us well-balanced people with the con dence to take chances in life—but not without some scrutiny.

Why Practical Optimism Works

It wasn’t until recently that I discovered my practical optimism had some scienti c validity. Dr. Albert Bandura may not be a name you’re familiar with, but in 2002 he was ranked as the fourth most frequently cited psychologist of all time, behind B. F. Skinner, Sigmund Freud, and Jean Piaget.2 So this guy was the real deal. Dr. Bandura discovered decades ago that perhaps the best predictor of an individual’s success is whether they believe they will succeed. ousands and thousands of experiments later, he has yet to be proven wrong. Henry Ford perhaps sums up this conclusion in one of his most famous quotes: “Whether you think you can, or you think you can’t—you’re right.” But as Dr. Bandura acknowledged, there is a catch. In order for this kind of optimism to work, you need to understand the difference between believing you will succeed and believing that success will be delivered to you on a silver

platter. A practical optimist knows they have to make success happen— through effort, smart planning, and plain old persistence. ere are a lot of people who practice meditation, creative visualizations, and the like, thinking they can generate prosperity strictly through believing good things will happen. To them, if they will it, then the universe will pick up the slack and bring them the good things they desire. Unfortunately, it doesn’t quite work on sheer daydreaming alone. ere’s an old song with the memorable title “You Can’t Roller Skate in a Buffalo Herd,” and that about sums it up. You can’t change reality with a vision board. You have to put in the effort. A famous study proves this point. Some years ago, a psychologist approached a group of women enrolled in a weight-loss program and asked how likely they felt the program would work for them.3 ose who were con dent they would succeed lost an average of twenty-six pounds more than those who weren’t. Score one for optimism. But then the psychologist also asked the same women whether they felt the weight-loss program would be easy or hard. In other words, would they be able to resist temptation and eat according to the program’s parameters? Well, the women who thought it would be a cakewalk (maybe an unfortunate choice of words), lost an average of twenty-four pounds less than those who thought it would be difficult. Score another one for practicality. ese results were replicated in many other studies, which involved subjects like students looking for high-paying jobs after college, singles looking to nd love, and seniors recovering from hip replacement surgery. e practical optimists worked harder toward those goals, believing they could succeed— which they did at a higher rate than the others. Job seekers sent out more résumés, singles approached more potential love interests, seniors after surgery

worked harder at their rehab exercises. Translation: belief combined with effort brought the best results. e science is in—practical optimism is simply the best way to go after your goals. And, to me, it’s the best way to handle everyday life as well. Not that there aren’t still challenges in nding the right balance. For example, when my practical side is dominating, I will pick up on it quickly when I put too much pressure on an employee who isn’t really providing immediate value to the company. Rather than coming up with a short-term plan to get them back on track, I may start thinking about letting them go before it’s necessary. But if I’m too optimistic, I might give that same employee far too much time and too many chances to turn things around until, eventually, their negative impact is undeniable, and it’s obvious I’ve waited too long to let them go. And sometimes my overly optimistic self rears its ugly head when I’m dealing with a client. Recently, I had a client who refused to pay their nal invoice. I kept telling myself they would come through with the payment if I just gave them more time. After they failed to honor the contract on multiple occasions over nearly ve months, I nally had to hire a lawyer to handle the situation, causing me a lot of stress and many sleepless nights. Eventually—and with a few choice words for me—they paid. But not before I learned a valuable lesson about the perils of being too optimistic—and not practical enough.

When Entrepreneurs Are All in the Family

Turning points—and being a practical optimist—are a Schmitt family tradition. When you look at our family tree, you will notice that many of us turned out to be entrepreneurs. My seventy-six-year-old dad, for example, has spent the last ve years as a driver for Uber in Phoenix, where he now lives. I like to say this job combines

his two favorite activities, driving and talking—and fortunately he is good at both. So much so that he was recently acknowledged as being in the top 10 percent of all Uber drivers in the US. Earlier this year, we were talking about the fact that our whole family has a dose of entrepreneurship in our DNA. And if ever there was a career that required practical optimism, it’s entrepreneurship. While the strict de nition of an entrepreneur is someone who starts their own business, the Schmitt family has a broader take on it—that is, you don’t have to own a business to have an entrepreneur’s mindset. To us, it’s more about controlling your professional destiny and having a willingness to change things up rather than abdicating your career to someone else who convinces you that upward mobility is a pipe dream. While taking direction from someone else may be a great t for some, my family and I are very aware of what makes us tick, and we set professional goals based on what drives us. ose goals may involve running a business, but they’re not limited to that. In some cases, it’s simply an unwillingness to stay in a thankless job or to work for a boss who takes all the credit without any accountability. In other words, we don’t play it safe if we feel we’re heading in the wrong direction with our careers. Once again, my dad is a perfect example. When he graduated from high school at age seventeen, he had already been managing a local Carvel ice cream store in Jamaica, Queens. His plan was to eventually buy the owner out and run the store himself. (Sound familiar? If it doesn’t, read the introduction again.) But instead he decided to follow the advice of his guidance counselor and the oh-so-accurate high school skills assessment test and entered college to become an architect. He earned a full scholarship from the Pratt Institute in Brooklyn where he grew up and was quickly on his way. Until he wasn’t. ree

years into the program, he nally admitted to himself that he wasn’t passionate about becoming an architect. Most people who have invested three years in educating themselves in a speci c eld would probably suck it up and graduate anyway, just so that they didn’t feel they had wasted all that time and money. But if it ultimately makes you unhappy, and it’s clear this career is not for you, then what’s the point? My dad’s passion was for business and marketing, and he had already proven his business acumen and ability to drive sales through innovation while managing the ice cream store. So he dropped out of school, returned to Carvel, negotiated with the owner, and bought him out. is was perhaps the biggest and most crucial life decision he would ever make, as it set him on the road to success in the restaurant industry (more on that later). e only thing he regretted was not earning a formal college degree, although in hindsight, there isn’t anything he could have learned in a college classroom that was even half as valuable as running a real business at twenty years old. You might think his decision got him into trouble with my grandparents. Drop out of college to sell ice cream? Sell cones instead of designing buildings? To most parents, this wasn’t even an option. But, again, our DNA is a little different, and my grandparents were completely supportive—so much so that they loaned him the down payment to buy the store. I recently asked my dad if he remembered any con ict with his parents as a result of his abrupt yet pivotal decision. His answer? “No, they knew who I was, they knew my passion, they told me I had a good head on my shoulders, and they trusted me.” Well, they de nitely get the award for Most Understanding Parents! Granted, this wasn’t blind trust, as they had already witnessed my dad’s keen business sense. Before he started working at the store, the previous owner would close down every winter—after all, who buys ice cream in January in Brooklyn? When my dad took over as manager, he found a way to make it a

year-round business. He had the idea to stay open during those frigid winters, but he would offer a 50 percent discount on everything and market the crap out of the store. Needless to say, there was zero competition, and surprisingly, taking that risk worked extremely well. e store was pro table, the owner was thrilled, and a once seasonal business could now operate twelve months a year. at was typical of my dad’s marketing moxie as well as his optimistic nature. Of course you can sell ice cream in the winter! His mantra was always “Let’s give it a try. What’s the worst that can happen?” And if you go back another generation, you’ll

nd more of the same

business acumen and innovation. My grandmother was employed at a New York bank for eight years before she nally decided she’d had enough of that kind of work. She wanted more freedom and the ability to make more money. So she gave up a reliable paycheck to pursue her dream of becoming a real estate agent. She literally walked into a local real estate office one day, cold off the street, and asked about a job (which, of course, she got). e fact is that all of my grandparents had siblings who were entrepreneurs in Brooklyn. My great-great-grandfather on my mother’s side owned a saddle-making shop, which, in order to keep up with the times, was later converted to a gas station. One great-great-uncle owned a TV repair shop while another had a dude ranch and another owned a butcher shop. My great-great-uncle on my dad’s side was a music publisher while my great-great-aunt was Rosie the Riveter brought to life, working on the bombers’ assembly line during World War II. She became a fashion designer after the war. So, yes, we Schmitts take risks, but we work extremely hard to make them pay off. But this risk-taking isn’t for everyone. My wife, Juliet, and her family were unfamiliar with this level of entrepreneurial career management. I’ve been working since age fourteen and

had already begun testing several professions before the age of twenty— rst at my dad’s Jack in the Box locations, then in retail, then for a golf products company during college. I began my “corporate” career at a national rental car agency, but after more than ve years, and the birth of our rst son, I knew the rental car business wasn’t for me—just as architecture wasn’t for my dad. Having tried two more professions after leaving the rental car agency— selling radio ads and selling auto parts—I decided to switch professions again and enter the world of recruiting. I remember explaining to my in-laws that I wasn’t ful lled in my previous jobs and that I wanted to nd something I was passionate about. Fortunately, I get along extremely well with them, although our career trajectories were quite different. My father-in-law was a corporate attorney for over twenty- ve years and left that position only after being appointed a federal magistrate judge. And my mother-in-law spent several years as a teacher, followed by thirty years as a museum docent. ey both had very traditional jobs that they loved, in sharp contrast to my family’s various left turns while we were navigating our career paths. So my decision to change jobs three times in six months was a little hard to comprehend at rst. But in short order, they began to understand who I am and what I’m about. I’ve always enjoyed talking to them about the ups and downs—and the unique mindset—of being a business owner and an entrepreneur who thrives in situations where I can create something new. I’ve just never been good at keeping the status quo. But while I’m the kind of person who needs variety and despises a predictable schedule, many people are perfectly content in more structured careers and would probably have daily panic attacks trying to run a business of their own. is reality hit me between the eyes during the Great Recession, when the economy was in free fall from 2008 to 2011 and unemployment was skyrocketing. My team and I decided we could help those who had lost their

jobs by serving as a career coach. People would hire us to write their résumés, conduct mock interviews, ne-tune their pitches to potential employers, and so forth. I can’t tell you how many times I would be working with an unemployed senior executive and ask them, “What do you want to do in your next role?” eir response to this simple question was usually to tell me what they had done over the past fteen or twenty years. I would then say, “No, I’ve got your résumé. I know what you’ve done. My question is, What do you want to do?” To my amazement, they would literally stop, take a deep breath, and say, “I never thought about that. What do I want to do?” In other words, they hadn’t ever thought about their careers in that way (at least not since graduating college). ey had ceded control and took whatever job came their way. To them, work was how you made a living, and long-term career goals didn’t often enter into the picture. For some, ful llment in life comes from having a career that pays the bills, is engaging and challenging, and provides structure. For me, however, I would not feel this same level of ful llment if my career path was guided solely by my practical side. Practicality without optimism breeds complacence in entrepreneurs. And optimism without practicality can easily lead to disaster for those same business owners. I feel blessed that I grew up with a father who made active career choices and inspired me to do the same and a mother who motivated me to stay grounded when I made my own choices. To me, it was the best of both worlds —it was practical optimism. In the chapters to come, I will share more experiences that demonstrate how the right mindset coupled with the right approach can help build worldclass teams, improve communication, manage crises, and create a better balance of life and work. e foundation for all of this, however, is practical

optimism. If you don’t already practice it, try to inject some into your life and see how it feels. You might nd that it suits you quite nicely.

Action Items

If you want to put practical optimism to work in your life, here are a few suggestions. Practice get to versus have to.

Get to versus have to is an exercise I introduce to many professionals to help them balance practicality with optimism. It’s not original—in fact, it comes from one of my favorite movies, Parenthood. In one scene, as he is about to head out to coach their son’s last Little League game, Steve Martin

nds out from his wife, played by Mary

Steenburgen, that she is unexpectedly pregnant with their fourth child. She then asks if he really has to leave instead of talking about their situation. His answer? He has to. In a t of frustration and overwhelm, he loses control, saying, “My whole life is have to!” We all have parts of our lives that can be characterized by have to—it’s inevitable. My advice is to spend time taking stock of all aspects of your life and make two lists—one that highlights the things you get to do each day and the other that is full of activities you have to do. If the latter list is a lot longer than the former, chances are you’re being far too practical, settling rather than taking control to build a life that you truly enjoy. It might be time to push back on your status quo, take some risks, and nd ways to make your waking hours more satisfying. Conversely, if there are too many items on your get to list, make sure

you’re taking care of your responsibilities and truly challenging yourself to follow through on your commitments and decisions—rather than simply taking the easy way out. Life shouldn’t be about getting to do what you want all the time. Do you have out-of-control optimism?

Maybe you sense that too often, you’re looking through rose-colored glasses and not acknowledging the potential downside of important decisions. If so, go back and review the last three to ve decisions you made in a given part of your life (career, love, nances, etc.). If you nd yourself looking at a list of not so great decisions that didn’t end well—and even worse, you realize you’ve been defending these bad choices again and again—then chances are your optimistic side has far too much power. Find a way to temper it with some practicality. What’s the worst/best that can happen?

is is a tool I use before I make any reasonably important decision. I ask myself, “What’s the worst-case scenario? What’s the best-case scenario?” Neither extreme will probably happen, but answering these questions will provide insight into the emotions that could be driving your thinking. If you focus too much on the worst case, you’re probably too afraid to take a risk, and you may lose out on an amazing opportunity. If you tend to lean toward the best-case scenario, thrilled by the seemingly unlimited potential, then you might be a bit too eager to take big risks, failing to consider the potential downside. e important thing is to allow yourself to look closely at both sides of the coin and choose from there. Yes, you’re still going to screw up occasionally—

after all, you’re only human, and that’s okay. Nobody’s perfect. And—what a coincidence—that’s just what we’re going to talk about in the next chapter.

 

CHAPTER 2

It’s Okay to Be Human

L

et me tell you something that you probably already know—every one of us is unique.

We all have different ambitions, passions, and values as well as different backgrounds, ethnicities, and personalities. And sometimes that can cause con ict. But it doesn’t have to. Because when we recognize, acknowledge, and accept other people’s individuality—as well as our own—we can make our communities and our workplaces better for everyone. Not only that but this broader acceptance also opens us up to reaching heights we never thought possible. Rather than avoiding the turning points in our lives, we should be challenging ourselves to let go of prejudices and fears to become more thoughtful, caring, and honest human beings. So let me start this chapter with a story about a signi cant turning point in my life that has literally shaped who I am—as well as my child.

Cass and Me

My wife, Juliet, and I have two children. Our oldest, Cass, came out to us as gay at fourteen. We were completely supportive of this and, just as

importantly, of Cass’s friendship-turned-relationship with family friend Maddie. Cass and Maddie have been best friends since birth, and her parents are the godparents of our youngest son, Cory. Maddie’s parents got divorced when she and Cass were fteen, and both ended up in same-sex relationships. At the same time, Cass and Maddie started dating in their own queer relationship. en, in late 2018, Cass came out as transgender. He changed his name to Carson, introduced himself with he/him/his pronouns, and started living his life as a trans man. We once again gave him our complete support—and so did Maddie. ey continued dating, no longer as girlfriend and girlfriend but as boyfriend and girlfriend. Juliet and I are very grateful that Cass felt supported enough to come out, and we were by his side through the many steps of this transition. As you may know, the suicide rate for transgender people is sky-high—and an alarming 52 percent of all trans people have seriously considered killing themselves.4 So we feel very lucky that Cass, who’s now twenty- ve, is happy and healthy and feels loved by his extended family. I’ve learned a lot from this experience and have incorporated it into my professional role because it’s a huge part of who I am as a human. I have my pronouns on my LinkedIn pro le, and I’ve asked everyone on my team to do the same thing. To me, the more we can do to normalize the LGBTQ community—or any marginalized group—the easier we make it for everyone to live happy and ful lling lives. But before you think I’m breaking my arm patting myself on the back, let me tell you where I wasn’t so great about the whole situation, at least at rst. And more importantly, how this experience allowed me to be even more human.

While Juliet and I had always been involved with the LGBTQ community (Juliet’s private therapy practice focuses on supporting clients from the community), this was a whole new world for me, as I’m sure it would be for many other parents. When I was growing up, people weren’t very open about sexuality that varied from the heterosexual norm of those days, and no one talked about gender identity at all. Just check out any of the iconic sitcoms from the eighties and nineties to see what I’m talking about. So there was de nitely some initial discomfort related to talking about Cass with my business colleagues and peers, most of whom are in senior leadership positions. Even though these were professional relationships, there was always some overlap with our personal lives—we’d inevitably nd ourselves talking about our families and comparing notes, because that’s what people do. But I always found myself holding back. I didn’t know if it was okay to talk about Cass being in a queer relationship (this was before he came out as trans), because I was afraid it would somehow disrupt my professional relationships. It was an internal struggle for several years. On the one hand, I worried about how these people would react, and on the other hand, I thought, Why shouldn’t I be able to talk about what’s happening in my life and share this joyous part of who I am? One day, I nally confronted my fear. I was attending a networking event with a very senior executive who I knew was gay. My wife and I had gone out with her and her wife, so we were well acquainted. After the event, as we parted ways to go to our respective cars, I stopped when I reached mine and thought, You know what? I’m going to go ask her what she thinks about all this. I walked back to her car and said, “Hey, Jacquie, do you mind if I ask you something?” “Yeah, sure,” she replied.

I told her about my struggle. “I don’t know how to talk about Cass and Maddie. On the one hand, I don’t want to disrespect Cass by downplaying or not even mentioning their queer relationship. On the other hand, I don’t know how to address it with people who don’t have any experience with these types of relationships. How do you handle these discussions?” She was very honest and said, “You know what, Ken? I don’t wear my sexual orientation on my sleeve. I don’t start a conversation by talking about my wife. But if somebody asks me, then I’m not going to hide it because this is who I am, and it’s part of what makes me, me. If people react negatively or they can’t handle it, then it’s their loss. But I’m not going to diminish my ability to feel good about my life or celebrate my own family out of fear for how they might react.” at was a great way to put it, and it really resonated with me. So from then on, when someone asked me about my kids, I told them about Cass and Maddie, including his journey coming out as trans. And to Cass’s credit, he appreciated the fact that I was sharing this with my contacts. I often reference my role as the father of a trans son when talking about the importance of recruiting a diverse workforce. And as an added bene t, since I began sharing this story publicly, I’ve been approached by no fewer than thirteen other senior executives, many of whom I’ve known for years, asking if I would be willing to talk to them about their trans son, daughter, niece, nephew, etc. ese are conversations and relationships that would have most certainly remained somewhat surface level had I not been willing to share my personal story. In a larger sense, I realized the best approach is to always bring your whole self to a conversation, whether it’s a personal or a professional one. When you share who you are as a human being, as well as who your loved ones are, you’ll be amazed by the results. Bringing your humanity to your interactions is of vital importance to living a truly ful lling life. Why hide or duck and dodge?

Most importantly, I want Cass to know that we’re all proud of who he is and that we’re never going to back off from sharing that pride. e message is simple: It’s okay to be human. at’s the only way we can celebrate our differences rather than allowing them to divide us. And that message should resonate loud and clear in the business world as well as in our personal lives.

Humanizing the Workplace

Unfortunately, some businesses tend to shy away from dealing with people as people. You can nd the ultimate manifestation of that in the recent Apple TV series Severance, where a corporation’s employees are forced to have their brains altered to cut the cord between their personal and their working lives. When they’re off the clock, they have no memory of what they did at the office. When they’re in the office, they have no awareness of what their outside life is like. ere are a lot of employers who would love that setup, because they don’t like any distractions in the office that take away from business getting done. ey want things to be accomplished quickly and efficiently without complications. I get that, especially since I own a company. But when a worker needs to leave early to attend a child’s recital at school or take a sick parent to the doctor, or if they just need a mental health day, you have to allow your team to attend to very personal matters, within reason of course. Sure, they’re employees, but they’re human rst. Corporate management has traditionally been a very top-down system. Most bosses used a my-way-or-the-highway leadership style that was all about growth at any cost. We’ve all heard horror stories about companies abusing their employees and constantly putting the company’s pro ts, or their own

personal welfare, above that of their team. And yet some of these CEOs became revered as business heroes, such as Jack Welch, the former head of General Electric. Welch ran GE with an iron st, requiring his leaders to cut the bottom 10 percent performers on a regular basis. “Either up or out” was his mantra, earning him the nickname Neutron Jack. A different type of leadership nally began to emerge in the early 2000s, when multiple studies found that people produced more when they worked for someone who treated them as humans, empowering them to do the job they were hired for. Nurturing employees created higher engagement, which in turn brought happier customers and better nancial results. Even management bene ted from this corporate epiphany. A 2020 Gallup survey showed that the outcomes of highly engaged business teams included the following boosts: •

Twenty-three percent in pro tability

•

Sixty-six percent in employee well-being

•

Ten percent in customer loyalty

•

Eighteen percent in sales

•

Fourteen percent in productivity5

Fewer negative outcomes were reported as well, including the following drops: •

Eighty-one percent in absenteeism

•

Forty-three percent in turnover

•

Sixty-four percent in workplace accidents

Clearly, the bene ts of a humanistic approach to employee management are overwhelmingly clear. e basis of this move toward a more humane company culture began with the notion of servant leadership, rst articulated by business researcher Robert

K. Greenleaf in 1964. Servant leadership’s central thesis is that management should serve its workers by helping them succeed in their jobs and, at the same time, be cognizant of their personal needs. It seems like common sense, but it took decades for this philosophy to enter the mainstream of business thought. Again, the results speak for themselves: the companies that emphasize servant leadership over pro t are consistently ranked at the top among their peers with above-average results.6 In his book, e Heart of Business, former Best Buy CEO Hubert Joly states, “I believe that business is fundamentally about purpose, people, and human relationships—not pro t, at least not primarily.” He goes on to say, “Doing great work for customers happens when employees relate to these customers as human beings.” Today’s workforce wants to be seen for who they are—humans—not simply for what they produce.7 To many, however, servant leadership is e Poseidon Adventure of management theories—you’re turning the whole business hierarchy upside down just to pamper your people. But that’s not at all what it’s about. Servant leadership doesn’t mean you’re bowing down to your team and letting them run the show. It means you’re equipping your people with the tools and mentorship to foster a positive, productive environment that ultimately allows them to reach their full potential. You’re seeing them as human beings, not as cogs in a machine, and in turn, most employees will respond positively to that human touch. Whether employee or business owner, I’ve never been able to accept the mistreatment of people in the workplace, probably because I was inspired by my dad’s experience. Here’s an example of how sticking your neck out for the little guy can bring positive change. In the early 1980s, when my dad was working for the Jack in the Box organization, there were about two dozen secretaries—yes, that’s what they were called back then—who would take a ton of work home every weekend, simply because they couldn’t get it all done

during normal working hours. To make matters worse, they weren’t being paid for this extra work. is had been going on for years, and it added up to a lot of unpaid overtime. My dad went to his boss, Fred,8 a VP, and voiced his concern—and to really grab the VP’s attention, he also told him that it was a huge lawsuit waiting to happen if the secretaries started to resent being exploited and decided to take legal action. Within the year, the entire process was changed. ey hired more people to get the work done, and if any of them incurred overtime, they were paid for it. It was a happy ending for sure, but it could have easily gone the other way —with my father being thrown out on his ass. Dad took a huge risk by bringing this up to his boss, because these employees hadn’t been complaining about the situation and simply accepted the encroachment on their personal time. It would have been easy to leave well enough alone. But my dad was bothered by the injustice of the situation. He knew this was negatively affecting their performance and engagement, and he felt compelled to do something. A similar thing happened to me during my tenure at the rental car agency in my midtwenties. Fred,9 one of my rst bosses, was the textbook example of how not to lead—coming in late and leaving early every day, asking employees to do the work he refused to do, taking credit for others’ success, and publicly blaming the team for any failures. To this day I don’t know what possessed twenty-three-year-old me to think I had any power to push back on his management style, but I decided to talk to his boss, the regional manager. I explained the situation and the low morale caused by this guy, telling him that unless I was transferred to a different office, I would be leaving the company (again, who does this at twenty-three?). Fortunately for me, the regional manager understood and had observed some of these behaviors himself. Even

more fortunately, I really liked the company and my job, making me an effective employee who was being groomed to eventually manage my own branch. e next week I was transferred to another office and ended up working for the best manager in the entire San Diego region. ere was no question that I was happier, more engaged, and much more productive.

Success and Life Satisfaction

As a boss, it’s far better to give than to take. Life’s not easy these days for anybody, so why not help reduce stress levels and incentivize people to take care of themselves? Why not use your leadership position to help provide more life satisfaction for your team? To do just that, several years ago I started a new program within our company, which I call Me Time. It’s quite simple: I reimburse each of my employees up to $100 per month to go out and do something for themselves —something that’s not a chore like grocery shopping but that will help them feel rested and refreshed. My team is composed of all women, so the majority of them tend to apply that $100 to a spa trip or a meal out with their signi cant other. e program doesn’t cost me that much, but the value is enormous. If I just gave them a $100 bonus every month, that wouldn’t really make much of an impact. But when a facial or a massage or a great meal with a loved one is on me, they remember that the company cares about them as a human being instead of seeing them as a number on a spreadsheet. When they tell their friends about this perk, they are usually met with this type of response: “Wow! Are you guys hiring? I want to work there.” Here’s a funny thing to think about: Me Time shouldn’t be just for your team. Not only do some business owners and bosses treat their employees badly but they also treat themselves badly.

Many leaders and high-powered individuals feel they have to drive themselves to the point of exhaustion to continue growing their companies, advancing their ambitions, and amassing a major bankroll. ey’re afraid that if they let up, everything will fall apart. But that kind of single-minded perspective has cost many leaders their closest personal relationships and even their health. Ultimately, it costs them their humanity. As mentioned previously, I’m a movie buff, so forgive me while I bring up another cinematic example of what I’m talking about, the old Michael Keaton comedy Multiplicity. In that movie, Keaton’s character has a hard time juggling his work and family life and creates several identical clones of himself (okay, it’s not a true-life story). Each clone assumes responsibility for a different aspect of his life. Soon, however, those clones are no longer identical. “Work Michael Keaton” gradually becomes less emotional and more task oriented while “Family Michael Keaton” transforms into a traditional retro housewife type, focused on the kids, taking care of the home, and bemoaning the lack of emotional support from “Work Michael Keaton.” While the various Michael Keatons begin as the exact same guy, they evolve into completely different individuals with different agendas. Soon each clone is totally independent and has absolutely no understanding of what the others want and need. As they say, it’s funny because it’s true. When you devote all of your energy to only one part of your life, the other parts can’t help but suffer. And you can’t help but suffer as a result. at’s why achieving a meaningful work-life balance is so important to your ultimate life satisfaction—it’s what we humans strive for. As I described earlier, I started my company in 2007, at a point when Juliet was heading back to work. We both wanted to nd a way to avoid having to rely on a nanny to look after the kids when they arrived home from school. I knew that we didn’t really need an office in the recruiting industry, so, from

day one, everyone at my company has worked remotely, including me. at way, I could be home to make sure the kids did their homework, to make dinner, and to keep the household running smoothly. Meanwhile, Juliet was able to drop the kids off at school in the morning and go to her office to see her clients. It all worked out great. To my surprise, that on-the- y decision to build a virtual business became a big part of our culture. at level of exibility was hugely appealing to new hires, especially those with kids. ey didn’t want to have to suit up and go into an office every day from nine to ve—and neither did I. My mantra was, and still is, “As long as the work gets done, I don’t really care where or when it’s happening” (and this applies to me as well, given that I am a night person, doing a lot of creative work from 9:00 p.m. till midnight). at approach has been a huge win for us. I’ve been able to get great people to join our rm, in large part because they could do it from home, and they’ve remained loyal and committed. Prepandemic, you just couldn’t get that kind of exibility at most other recruiting rms—or at any rms for that matter. My team appreciates this empowerment. is is the same reason why we offer unlimited vacation time. ey know that I trust them to do the work handed to them, and they don’t abuse that trust (something we will talk a lot about in the next chapter). e upshot is this: Because I decided to make my business work for my family’s life, it also ended up making it work for my team’s lives. We attracted (and continue to attract) above-average employees, largely because autonomy and empowerment are so appealing to overachievers. ere was one other important decision I made to keep my life satisfaction as high as possible—remembering my human side. And again, the decision was based on an idea that runs completely against traditional business thinking. My decision? To not grow my business too much!

I read between eight and twelve business books every year, and 95 percent of them (at least it feels like 95 percent) advocate for nonstop growth. e authors focus on improving pro tability solely by building larger corporations —it’s all about scalability. As a small business owner, these books can make you feel like you have to grow your company or both you and your business will be considered a failure—or worse, a “lifestyle company” (as if working seventy hours per week driven by blind ambition to grow, grow, grow was a good lifestyle choice). en I discovered a book about a decade ago titled Small Giants by business journalist Bo Burlingham. It was the rst book I read that gave permission to small companies to stay small and to do things for the right reasons. e more I thought about expanding, the more I realized I didn’t want to open up offices around the country, traveling nonstop to oversee those different locations. Running a business empire just wasn’t appealing to me, even if I did manage to pull it off. For me, it isn’t what makes me tick as a human. Yes, we’ve de nitely grown since our beginnings. But our size is nowhere near the titans of the recruitment business—and who cares? We do very well in our own niche, and I never need to worry about compromising what’s important to me—family, creating a truly employee-centric culture, and taking care of our clients. You’ve heard the phrase grow or die? Well, I have one word for that kind of thinking—bullshit! Follow your own path, not someone else’s prescription. Put passion over pro t. Tap into your humanity to avoid becoming “Work Michael Keaton.”

Own Your Reality

Being authentic and genuine is another thing I do to stay human. Often, when I’m at a business event, someone will come up to me and say, “How are you doing? Business is good, right?”

In other words, they’re answering the question for me. e message I get from that is “All I want to hear are good things. If you have something bad to say, keep it to yourself.” Or even worse, they’re just thinking, I really don’t care how you’re doing. I just want to get an opportunity to tell you how I’m doing. Sometimes I will see someone at an event and ask how they’re doing, even though I know that things may not be going so well (they may be in a struggling industry, or I may have heard through the grapevine that their business is experiencing some challenges). As I approach them, I wonder if I can help them out in some way. So I’m hoping for a genuine answer, which allows us to talk about potential remedies. But what I typically get instead is something like this: “Oh, things are great. We’re really busy.” ey sugarcoat everything because they don’t want anybody to peek behind the curtain and call out the wizard. Yes, everybody likes to put up a good front, but ultimately I think it’s more harmful than helpful. Where’s the humanity in perfection? When you do admit to a problem, the other person may have some great advice or, at the very least, offer a shoulder to cry on. Men in particular seem to have the biggest problem discussing negative events from their professional or personal lives, as most of us were raised to be brave and self-sufficient, without showing any vulnerabilities. I believe this is changing somewhat with younger generations, but traditionally the masculine model has been to avoid showing any weakness and to constantly live in problem-solving mode. e reality is that it’s a lot healthier to own who you are and what you’re going through than to be in denial. Don’t get me wrong. I don’t think you need to spill your guts to anyone who will listen or wear your emotions on your sleeve in every interaction—the concept of TMI is alive and well. But what we do have to remember is the title of this chapter—it’s okay to be human. And being human means we all have our ups and downs, and there’s no point in trying to pretend we don’t. When somebody asks how things are

going, I’m honest. If I’m having a bad quarter, I’ll say, “ings are okay, but this year’s been a bit of a struggle. We’re trying to gure out how to get past it.” I’m going to give a real answer, in the hope that we can engage in a substantive conversation rather than fall back on the standard chitchat. When you keep it authentic and real, you’ll nd yourself engaging in much more interesting conversations. Again, somebody might have some helpful advice for you—advice you wouldn’t get if you avoided the truth by glossing over your situation. I’ve also found that if you’re willing to be the rst one to show your vulnerability, you are more likely to have the other person reciprocate. You’ll have a deeper, more genuine talk as a result of showing your human side. at’s what I’ve discovered just from being myself—sharing my mistakes, discussing business challenges, or talking about Cass. I have also seen leaders who refuse to admit to their own team that they made a mistake. Well, brace yourself—we all make mistakes. As a business owner in charge of business development for the rm, I sometimes take on clients I shouldn’t (usually because I give into the overly optimistic side of my practical optimist personality). And once in a while, things don’t go well, and we end up with an unhappy client who has no desire to work together to nd a solution. I end up wasting a lot of time and energy trying to x the client relationship, even when it’s obvious that’s not possible. When this happens, I don’t shift the blame to my team for failing to deliver what our client asked for. I blame myself for accepting the client in the rst place, given the red ags that were apparent at the beginning. It’s better to admit mistakes than to pretend they didn’t happen—or worse, to nd a scapegoat. I’ve found that my team shows more trust and faith in me because I am forthright about my screwups, something I learned from my executive coach, who encouraged me to share my learning experiences whenever possible. Pretending to be infallible doesn’t fool anyone. Nobody

feels great all the time. Nobody is in a good mood all the time. No one makes the right decision all the time. ere are times when things are just…well, shitty. Let me end this chapter with one last thought about being human: Don’t be afraid to give yourself and your team a break. You’re not a machine, and every so often you need to give yourself permission to just shut off from everything and everyone so that you can refresh and regroup. I’m not talking about turning off your phone and heading to Jamaica for three weeks without telling anyone. I’m talking about taking small breaks along the way. Remember when I mentioned how great it was to work from home? Well, let me pull that back a little. It’s great to work from home when you’re not remodeling the house, or grappling with launching a new business line, or experiencing a downturn in your business. As I write this, that’s exactly what is going on in my life. I’m trying to conduct meetings and calls and to concentrate on my work in the midst of very loud hammering and sawing, workmen yelling, and the sounds of whatever other power tools are threatening my hearing. Not to mention the loud voices inside my head telling me all the reasons why I should worry about the business, how this is not a good time to create a new business offering, and why this is the worst time to be spending on a remodel. Needless to say, this has sent my stress levels soaring as of late. And to make matters worse, an overwhelming number of incredibly negative world events are also taking their toll. Which is why, the other day, when I was in my home office, my chest got very tight, and my stomach began hurting like crazy. My muscles were tensing up, I had a horrible headache, and my stomach was experiencing some of the worst indigestion I’ve ever felt. What I was feeling was a panic attack.

Rather than ignoring the obvious signs that I was in overload mode, I owned it and accepted it for what it was—my body was telling me it was time to unplug. I hopped in my car with the dog and drove down to the beach. ere I parked where I could watch the waves, and I just sat in the car for about ninety minutes. I didn’t listen to music. I didn’t look at my phone. I didn’t call anyone. I just rolled down the windows, took lots of deep breaths, and listened to the ocean while I tried to relax and recenter myself. And after that little getaway, I felt much better and reequipped to handle the big decisions that were still in front of me. Some people meditate or practice mindfulness exercises, but my happy place has always been the beach. e point is, everyone needs someplace to go or an activity to do when feeling overwhelmed. is is another thing I’m not afraid to share with my group. When I need a break, I tell them I’ll be gone for an hour or two to clear my head. I tell them when I’m out walking with my wife, I tell them when I am leaving the office at 4:00 p.m. to attend my nephew’s concert, and so on. Why do I share those seemingly irrelevant things? To achieve the simple goal of normalizing self-care. From what I’ve seen, very few leaders feel comfortable or con dent enough to take this route, because, again, they don’t want to show any weakness. It’s very vulnerable to tell your team you are heading to the beach for an hour to clear your head. But let’s be honest. Everyone feels overwhelmed at one time or another. e trick is to recognize what’s happening and to take a time-out when needed. Trust me, ignoring the signs will lead to a much worse outcome, for you and for your business. (By the way, can you tell I’ve been married to a therapist for thirty years?)

Action Items

Feeling like your humanity is disappearing, crowded out by so many priorities on your plate? Try these suggestions to keep it real. Make time for you.

e story I just relayed about sitting in the car with my dog at the beach epitomizes the need to take a break when everything seems so daunting. We all need to recenter ourselves from time to time—to unplug, clear our minds, and refresh our thought process. Afterward, I nd I’m more focused, more productive, and more able to see things in a way I couldn’t when I felt underwater. But I don’t believe in waiting until your body begins to shut down to take that break. Don’t lament day after day that you really wish you could take some time for yourself but that there just aren’t enough hours in the day. Instead, be proactive. Make a habit of blocking out time on your calendar to follow through on your commitment to maintain your sanity by exercising, cooking, walking, taking your pet to the beach, etc. Share mistakes and weaknesses.

As I mentioned in this chapter, the more you share with others, the deeper the connection will become (and the less burdened you will feel). What really counts is not being afraid to say you screwed up. Or to admit to someone that a certain skill just isn’t one of your strengths. All you’re really admitting to is being human. We all need to do this on a consistent basis in order to stay human.

e more you display your humanity, the more others will relate to you and begin to understand who you are—and the more they’ll reciprocate by opening up to you. ere’s no point putting up a front of perfection. Nobody will believe it! Don’t get me wrong. You shouldn’t walk around whining about what a loser you are and how much the world around you sucks. Just be honest about your shortcomings and be open to hearing others’ insights. Make time for lessons learned.

You also want to encourage your people to admit their mistakes without being afraid of punishment. at’s why in your weekly staff meetings, you should block off time to discuss two key items: lessons learned and biggest successes. It’s not about dwelling on everyone’s mistakes; it’s about discussing the problem and agreeing on ways to prevent it from happening again by doing things differently next time. at way you create an atmosphere where everyone feels comfortable being honest about not getting it right. Otherwise, if they’re hesitant to tell you un attering information or to push back on your ideas, you’ll be left in the dark about things you need to know, until it’s too late. Share your priorities.

Here’s another, albeit less traditional, way to show your team the real you. Make a list of what you consider to be the top ten most important things in your life and check off those items that your people are already aware of (family, music, travel, etc.). Review the rest of the list to see if you’ve been holding anything back that would help your team

truly understand who you are. If so, share those items. Let your human side shine through, and your team will respond in kind. As human beings, we can sometimes feel lost and confused. But there’s a great way to regain your bearings, remind yourself of who you are, and get realigned with your goals—and that’s by tapping into your values. ey will be your North Star when you are trying to work your way out of difficult situations or when making a signi cant professional or personal decision. In the next chapter, I’ll tell you how this strategy has worked for me.

 

CHAPTER 3

Know Your Values

nne Mulcahy, the former CEO of Xerox, once said something that really resonates with me: “Who you are, what your values are, what you stand for…they are your anchor, your North Star. You won’t nd them in a book. You’ll nd them in your soul.”

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I really believe this to be true, and I know my own values have guided me through many tough spots. We’ve all had to push through some pretty serious challenges in recent years. When you’re trying to nd your way out of a global pandemic, an economic upheaval, or even a company- or industry-speci c headwind, it’s easy to lose sight of who you are and what you stand for. at’s why having a foundation of solid values is so crucial. We all need guideposts to refer to when the world around us goes haywire. As I said in the last chapter, it’s okay to be human. It’s okay to make mistakes and have weaknesses. We all deserve a hall pass occasionally. However, being human also comes with certain responsibilities. Without this North Star of values, it’s really easy to get yourself in deep, deep trouble. To illustrate that point, let me tell you about the time I repeatedly broke the law.

A Corporate Conundrum

Yes, it’s true, I once was something of an outlaw, but then again, so was everyone else around me. Before you judge me, read on. I’ve already shared that very early in my professional career, I worked for a large rental car agency. Today it is considered one of the best places to start your career. However, in the mid-1990s, it was like the Wild West. Just about everyone in a position of leadership was in their twenties, like me. Most of the leaders struggled with managing a team, and very few had any leadership training. I did well after a year and a half on the rental side of the business, so in 1993 I was promoted to car sales, where I was told I was to do whatever my manager—we’ll call him Fred Jr.—ordered me to do. at’s where the trouble started. Fred Jr. said not to worry about any potential customer’s debt-toincome ratio when I was qualifying them for a car loan (a speci c formula used by banks to determine whether a customer made enough money to afford a speci c car payment). “Don’t even question their credit worthiness. As a matter of fact, just have the customer sign a blank credit application. And if you forget to have them do that, go ahead and sign it yourself,” Fred Jr. would tell me time and time again. What could go wrong? If you haven’t already guessed why we would have customers sign blank forms, it was because, when necessary, we would take those applications, ll in the customers’ information, and then adjust their expenses or income levels in order to get the applications approved (and although it was rare, once in a while, I followed his additional orders to sign a credit app myself ). is was de nitely not okay! And deep down I knew it wasn’t, even though every office was doing it. e leadership team justi ed it by telling us we were simply

helping customers qualify for the car they wanted, and the banks pretty much knew this was going on, which may have actually been true, because they never bothered to verify anything. is wasn’t an unusual practice back then, both in the car market and in the housing market. People not only were getting approved for car loans they shouldn’t have been eligible for but also were getting giant mortgages that they would ultimately be unable to pay off. is contributed to the credit bubble that inevitably burst and caused the Great Recession at the end of 2007, a little over a decade later. Maybe that eventual crash was simply con rming just how wrong these practices were. At the rental agency, our system of making the credit application say what we wanted it to say went on without a hitch until, one day, one of the banks we worked with (and a pretty good-size bank at that) picked up on the fact that a customer’s signature on a credit application I had submitted didn’t match the signatures on his other loan documents. Whoops. I guess that was what could go wrong! e bank called Fred Jr.’s boss, whose name was Fred Sr., and asked what was going on. Because, of course, shit always rolls downhill, Fred Sr. called me directly and came down on me hard. Let me paraphrase his side of the conversation: “Ken, what the %*#@ were you thinking?” It was pretty obvious that he was about to re me. I was honest. I took responsibility for the misdeed and admitted that I was guilty. I owned up to my actions and accepted my fate. However, it was obvious that Fred Sr. believed that I had acted alone in this male cence, as if I was a lone wolf who single-handedly dreamed up this whole elaborate scheme. I explained to him that I was trained this way, and that if I didn’t follow this protocol, I knew I would be red (Fred Jr. wasn’t known for being easygoing; in fact, there was a time when he yelled at me at the top of his lungs for ve straight minutes on the car lot in front of customers because I didn’t close a

deal.). I also knew there was no way Fred Sr. was unaware of our credit application shortcuts. He had trained Fred Jr., who in turn trained me, so I knew that his playing dumb was bullshit. He was just pissed that we got caught. To make matters worse, Fred Sr. was even more upset that Fred Jr. did not take responsibility like I had. Frankly, I think he was surprised that I told the truth after Fred Jr. basically threw me under the bus by claiming he had no idea this was going on. Fred Sr. quickly told me he would call Fred Jr. and would get back to me. Surprise, surprise, Fred Jr. immediately called me, literally crying, saying we had to stick together on this and that we were partners and could work together somewhere else, even though he tried to put all the blame on me not ten minutes earlier. I played along, even though I was thinking, Dude, this is bullshit. You’re only changing your tune now because you might get red too! Somehow we both escaped with only a stern reprimand—and the inability to use that bank ever again. inking about it now, I understand that the main reason we didn’t lose our jobs was because they would’ve had to re everyone, as all the branches were doing business that way. I knew it wasn’t right when I was doing it, and saying that I was just following orders is a pretty lame excuse. However, I was only twenty-four, and most of us end up bowing to the powers that be at that age. When push came to shove, however, I stuck to my values. I took responsibility for my actions and owned up to my mistakes. But I also didn’t allow the injustice to go unchecked. I wanted to make it clear that the system forced me into it. Sticking to my guns probably saved my job, but it wasn’t any great triumph—after all, I still felt forced to do wrong in the rst place. I am completely embarrassed and horri ed that I engaged in these practices. In fact, I debated whether to even include these events in this book.

But at the end of the day, I am sharing this experience to illustrate a point and to help others avoid my mistake. It’s certainly something I wouldn’t consider doing now, nor would I ever put someone else in a position where they are forced to compromise even a small portion of their values. e feelings I experienced during that episode in my career made a huge impact on me, both personally and professionally. It signi cantly shaped my business philosophy and leadership style, and I have no doubt it made me a better leader.

The Danger of Working without a Values Net

Business is business, and when you don’t have the right values in place, it can become very ugly, very fast. Unfortunately, too many employees and freelancers nd themselves in the kind of dicey situation I just described (heck, I just nished meeting with someone who told me how she got red from a pharmaceutical company at age twenty-seven for refusing to forge doctors’ signatures on prescription pads!). In our modern economy, a lot of companies are focused on pro ts at all costs, no matter the consequences. We all know the horror stories about Amazon drivers who end up peeing in bottles because their strict timetables don’t allow them to search for a restroom. Too often, the end somehow justi es the means. at shortsighted thinking has led to the collapse of more than a few companies that were guided by leaders who began to believe their own bullshit. ose of you who have been around a few years easily remember companies like Enron and WorldCom, out ts built on fraud that eventually crashed. ere are tons of other examples I can cite, and you probably can too. As I write this book, two of the major streaming services are airing a miniseries

highlighting how bad business practices took down three supposedly innovative corporate darlings: WeWork, eranos, and Purdue Pharma. But Wells Fargo takes the cake when it comes to brazen disregard for ethics and, frankly, morals. ey have a history of consistently abusing their customer base. ey steered Hispanic and Black customers into high-interest subprime loans, allowed money laundering on a regular basis, and gouged customers with huge overdraft fees. In addition, in September 2016, the bank was ned $185 million for opening over 1.5 million checking and savings accounts and 500,000 credit cards on behalf of customers without their consent. ink about that. A business that is entrusted with your nancial well-being felt so compelled to meet their numbers and hit their quotas that management opted to ignore ethics, morals, and common decency to create ctitious accounts (and I’ll bet many of the employees creating these accounts were twenty-fouryear-olds taking direction from their bosses, just like I was). at last item alone caused the ring of nearly 5,300 employees.10 Why was this allowed to take place? It comes down to placing pro t and shareholder growth over ethics and doing the right thing. We continue to read stories like this every day. And because so many executives seem to pro t from this malfeasance, escaping with a mere slap on the wrist, it’s easy to get cynical about the value of values. If nobody exhibits strong ethics, why should we even bother with them? e irony is this: By every measure— nancial, moral, or otherwise—it’s better to run a company honestly and ethically. To quote Investopedia, “Companies that implement a management philosophy that relies heavily on business ethics are proven to be more successful than those that operate in an unethical manner.”11 Furthermore, research shows that “56 percent of US consumers stop buying from companies they believe are unethical. What’s more, over one third (35 percent) of consumers stop buying from brands they

perceive as unethical even if there is no substitute available and 27 percent stop purchasing even if they think the competitor offers lower quality. Overall, more than three in ve consumers feel that ethical issues are becoming more important (63 percent).”12 is focus on company values is particularly strong in younger generations. ey expect companies to behave responsibly, and if they don’t, they simply won’t buy from them. ankfully, they have no qualms about sharing their distaste for a brand or business. A company’s long-term survival, just like a human being’s, depends on the existence of sound ethical values. A line must be drawn between right and wrong, good and bad, just and unjust. Now I’m no Pollyanna, and I know things happen that shouldn’t. But these fraudulent scenarios should be an anomaly, not standard operating procedure. If you’re in the business world, I’m sure you’re aware that there are plenty of examples where shady practices are not only winked at but also openly encouraged by top leadership. To me, if you want to sleep well at night and feel good about yourself (and you’re not a sociopath), that’s reason enough to run an ethical company.

Good Comes from Good

So where do strong values come from? Usually, a morally sound foundation is created by your parents, guardian, grandparent, or whoever raised you. I was lucky because I had excellent role models all around me when I was growing up. I began working directly for my father, beginning at age fourteen, before I even had a work permit (I suppose if you count the couple of weeks in middle school when I bought candy at 7Eleven for three cents apiece and sold them on the school bus for a nickel, I actually started “working” at age eleven). Watching my dad navigate the

craziness of management and business ownership, I learned how to apply strong ethics in the workplace day after day and how to treat others with dignity and respect—while still running a pro table enterprise. During my teen years, he was running several Jack in the Box franchises in the Southern California area. He built strong relationships with customers, employees, and other franchisees, and he knew how to manage in a positive way. He did a lot of little things that really made an impression on his team. He was always the rst person to step in and take customer orders, clean the dining room, or lend a hand in the kitchen during a rush. Around the holidays, he would drive from store to store, handing out envelopes with cash bonuses to all the workers as well as a holiday ham for all of the managers. I would go with him on these deliveries, and I distinctly remember how happy everyone was to receive these wonderful extras hand-delivered by the owner. is small gesture helped build a real team atmosphere rather than an usversus-them mindset that’s all too typical in employee/employer relationships. Since most of his workers were Latino, my dad also made it a point to learn enough Spanish to allow him to communicate more easily. He cared that much about forging a strong connection with his people, and the results showed. Both of my parents contributed to my positive values, with my mom constantly reminding us about the importance of trust, honesty, and respect for others. ey were also quite transparent with my sister and me about how things were going with their businesses and jobs. Our dinner conversations were incredibly educational because not only did we talk about the typical goings-on—school, friends, the latest episode of e Brady Bunch or e Love Boat—but also about how they were working to overcome difficult situations in business and what to do when dealing with a dishonest person or someone who just didn’t take their job seriously.

I credit both my parents with helping me to develop an ability to consider all options when making a big decision—either personal or professional. is was true even when my parents sat my sister and me down to talk about their decision to move from San Diego to Los Angeles in 1978. I was eight, and I vividly remember them sharing the reasons for this decision and how it would bene t our family. I also remember the same conversation three years later when we moved back to San Diego for my dad’s next promotion and then eighteen months after that when my dad lost his job as part of a corporate restructuring, prompting him to buy his rst franchise. I always felt like I was more of a peer to my parents than just a kid who was expected to sit down and shut up. I don’t know if they realized how much they were teaching us while being direct and honest about their adulting. My folks were never so blatant as to say, “Okay, here’s an important business lesson, so listen up,” or “Let me tell you how to handle this personal problem later in life.” ose are the kinds of statements designed to make kids run for the hills. Instead, their own real-life stories provided those lessons in a much more meaningful way, because they embodied their values. Be a good leader in your business. Accept responsibility for your actions. Always have a plan B. And above all else, be a good human being and treat others with respect. All of this was communicated to us simply through casual, candid, and consistent conversation. It’s a tradition we’ve carried on with our own kids.

Learning from Tough Calls

It’s not always easy to hold true to your values. We all face ethical challenges every day (like I did at the car rental agency). But when you know your values

and they’re ingrained in your behavior, you’re able to make better decisions and be a more effective leader, especially when you are under a lot of stress. It’s easy to stick to your values in good times, when nothing is challenging the status quo. But those values also serve as necessary guardrails when times get tough. For example, there have been several times when my company struggled nancially and we needed to nd new sources of revenue—fast. But when a prospect with a questionable reputation approached us during those times, I had the fortitude to walk away rather than to take on bad business, all thanks to our core values and my practical optimism. As a recruiter, I don’t want to work with businesses that are problematic. Every time I have, I’ve regretted it. is policy isn’t meant to protect just my company and me; it’s also a re ection of my obligation to protect the people I recruit. In most cases, we’re asking someone to leave their current job and accept a new role with our client. If I feel that a company or leader is going to be difficult to work for or has a crappy reputation as an employer, I can’t in good conscience ask a candidate to leave a secure job for a new one that could blow up in their face, and I don’t want to be the guy who threw them into an alligator pit. A mentor of mine in the recruiting business, who sadly passed away recently (we miss you, Pepper!), used to say, “We’re in the business of changing people’s lives.” at mantra has really stuck with me. As recruiters, we exist to help people land a job with a better income, a stronger work-life balance, a more engaging position, a higher title, or any number of things that will improve their day-to-day life. Likewise, we partner with companies to bring them talent that will enhance their organization in an ethical and reliable manner. My team and I feel that deep responsibility to both sets of stakeholders, and we take it very seriously—driven by our values.

Building a Values-Driven Team

Even though I’m the owner of my business and I try to imbue my operations with positive values, it can’t be just about me. I need a team that shares this belief in doing business the right way, or at some point I will have to deal with someone else’s not so great judgment. So when I make a hire, I work very hard to ensure that the candidate’s values are aligned with our company’s. In this way, our internal ethics grow even more powerful. Since launching TurningPoint in 2007, I’ve developed seven key values that drive our success. I’d like to share them with you. We are a small company, requiring us to work as a very close team, which means that trust (key value 1) is absolutely essential. I need to make sure that whoever we bring in works extremely well with others, operating from a place of collaboration, not skepticism. at’s why conducting a thorough interview is so important. My interviews go way beyond the clichéd and meaningless question, “Tell me about yourself.” Instead, I ask about situations when they had to trust a coworker or subordinate to complete a job, even if they used a different approach, or when they had to support their manager’s decision even if they disagreed. But I can’t ask everything I’d like. For instance, I would love to ask people if they come from a good family and if they have kids, and if so, what their philosophy is on parenting. I’ve learned over the years that these data points are an important barometer of how they will function within our company. Family is extremely important to me. I know the names of all my employees’ spouses, their kids, their kids’ ages, and what’s important to them as a family. But I can’t legally ask these questions during the interview. Instead, I talk a lot about how close we are as a team, painting a picture of how we function together, to let them know what type of company they are joining. Our dynamic is very unique, and work-life balance (key value 2) is

extremely important to me as a leader. During our interviews, I also ask what they do outside of work. Sometimes they say, “My spouse and I like to travel,” or “I coach my kids at Little League,” or “I am teaching myself to play the piano,” which gives me an even better sense of who they are, how they prioritize their lives, and whether they are willing to share what makes them human. As a small company, hiring someone who de nes themselves based solely on their job just won’t work for us. It always made me feel so proud when I could make my parents, my sister, and my friends laugh, even when it got me into trouble for cracking jokes during class. And on more than one occasion, my mother-in-law and my high school friends would say, “Kenny, your mind is so quick, you should be a comedian.” While I have yet to pick out a stage name to support an act, this sense of humor (key value 3) has carried me through many a difficult day, and it helps if the people I work with also recognize and embrace the lighter side of a bad situation. And above all else, they must be willing to laugh at themselves. If the person I’m interviewing doesn’t crack a smile, or never jokes around, or can’t relax as the interview progresses, again, they might not be a good t for us, because we don’t take ourselves too seriously. Ego and arrogance are not welcome in our operation. We all believe in the power of humor and having fun to make work less stressful—and more human. Yet at the same time, we’re committed to delivering a high-quality service to our clients, and our work ethic (key value 4) is unparalleled. e importance of a strong worth ethic was without a doubt instilled in me by both of my parents. Even after my dad became vice president at Jack in the Box, earning a very hefty salary, we never lived beyond our means or had fancy cars or traveled to exotic vacation destinations. However, they made it known that we were able to live an uppermiddle-class lifestyle as a result of the effort, energy, and hard work they put into their jobs.

People who work at TurningPoint know that I also expect them to challenge the status quo (key value 5)—and that status quo includes me. I don’t want yes people who create an echo chamber of my ideas. ere’s a business axiom that states, “Always hire people who are smarter than you.” ere’s a lot of wisdom in that, but I would amend it just a bit to say, “Hire people who can do the things you can’t.” Fill those gaps in your own expertise by adding new skills to your company instead of duplicating what’s already there. It’s also imperative that we build a team that doesn’t always approach a problem from the same direction. e best way to ensure that we have a mix of perspectives is to inject diversity (key value 6) into the hiring process. A coed team with different cultural backgrounds, outlooks, and life experiences will create an organization that is more creative, disruptive, and innovative (we will address this in more detail in chapter 8). I pick up a lot from people whose expertise and life experience don’t match up with mine. To me, if a leader isn’t willing to learn from the team (key value 7) and instead clings to the delusion that they’re always right, they’ll eventually crash and burn. Here’s how I almost did that very thing, by ignoring that last key value. As I referenced in an earlier chapter, in 2009, when we were in the middle of the Great Recession, our recruiting revenue dropped dramatically. We began providing career coaching for people looking for jobs to help the multitude of unemployed professionals. We would charge a small fee to help them create a job search strategy that equipped them with the con dence and narrative to enhance their interviewing. And because our recruiting business was so slow, we also offered résumé writing services. e economy nally began to pick up in late 2011, and so did our core recruiting business. at’s when Elaine, my right-hand person, said to me, “You know what, Ken? We shouldn’t spend so much time on the coaching side, especially doing résumé writing for our clients, because it requires me to

drop everything else to meet a very tight deadline. And it also takes time away from our recruitment clients and your business development. When you look at the numbers, the coaching isn’t generating a whole lot of money anyway, and the ROI on your time just isn’t there.” But I was stubborn. I was passionate about coaching—I loved doing it, and I wanted to keep doing it. So for another six months, we continued to offer these services, all the while Elaine would constantly push back, asking me to reconsider. Eventually I saw that it didn’t make sense to put so much into the coaching practice when we were getting so little return. I nally told Elaine she was right (which I’m pretty sure she already knew). I respected the fact that she was willing to push back on me, challenging the status quo and sharing her perspective. She knew what was important to our brand and to our revenue model. Ironically, this transition away from coaching and résumé writing became a positive for us. We took all the coaching materials we had developed and put them on our website as a free toolkit, which also added value to our online presence while supporting our candidate community at the same time. e decision to give these services away, after charging a fee during the previous three years, came out of a brainstorming session with Elaine where we discussed how to wrap up that part of our business. Whether it is pushing back on the status quo, offering up new ideas, or simply collaborating to nd a new approach, none of this could have taken place without our number one key value, trust. If Elaine didn’t trust me, she would have been hesitant to continue challenging my decision to stick with coaching. If I didn’t trust Elaine, I wouldn’t have listened to her perspective, and we would have continued to make a big effort for a small payoff. As noted by Stephen Covey, best-selling author of e 7 Habits of Highly Effective People, “Trust is the glue of life. It’s the most essential ingredient in

effective communication. It’s the foundational principle that holds all relationships.” And the stats back him up on this. e Harvard Business Review states that, compared with people at low-trust companies, people at high-trust companies report the following bene ts: •

Seventy-four percent less stress

•

One hundred six percent more energy at work

•

Fifty percent higher productivity

•

irteen percent fewer sick days

•

Seventy-six percent more engagement

•

Twenty-nine percent more satisfaction with their lives

•

Forty percent less burnout.13

In other words, trust is worth ghting for, so I do everything I can to make sure it is the core value that drives our culture. My team has to trust each other to do their jobs, and they have to trust me, as the owner and head of business development, to bring in clients. And I also have to trust my team enough to know that when I bring in a client who’s a little challenging, they will work their tails off to get the job done. I’ve just described the values that I’ve deemed essential to my organization. Some are important for any company to possess—trust and work ethic, for example. However, other companies may not care so much about things that matter to me, like having a sense of humor or a strong family. It all depends on the nature of the company, the leadership style, and the speci c job. at’s why, during our kickoff call with a new client, we ask a lot of questions to establish what kind of person they want to hire, such as the following: •

How do you like to communicate?

•

What kind of person is successful in this company?

•

What drives your company, and what differentiates you?

•

How would you describe your employment brand?

•

What kinds of people don’t work well here?

•

For people who have left the company, why did they leave? What caused that misalignment?

When we have the answers to these and about twenty other questions, we can begin interviewing candidates with those qualities in mind. Issues arise, however, when we work with companies that haven’t taken the time to de ne their core values lacking an understanding of their true culture. In their bestselling book Beyond Entrepreneurship 2.0, Jim Collins and Bill Lazier talk about the importance of crafting your company values as early as possible, regardless of your eventual exit strategy or company size. When you’ve injected the right values into your workplace and everyone respects and honors those values, it’s amazing what can happen. Recently, we placed the new US COO for Kia America, the multibillion-dollar car company. is is a huge organization, and you would have expected Kia to use a name-brand, specialized, global search rm for this enormous task. Well, that’s not us. We have seven employees, and we don’t specialize in the automotive industry. But we had already completed ve successful searches for Kia, and they liked what we delivered, how we operated as a team, and what we stood for. With a good track record already established, we were able to beat out the big guys to secure this search. at only happened because my talented team is motivated to provide personal, unwavering service grounded in our core values. Because I take the time to hire a team that complements my strengths, we punch way above our weight and work extremely hard to deliver

what our clients want. Underpinning all that is our foundation of values, which informs everything we do.

Action Items

Here are seven ideas for how your company can internalize strong values and put them to work in your organization. Think about what attracted you to your favorite company, job, and/or manager.

Make an extensive list and use it to extract the values you want your organization to represent. Take inventory of the lessons you’ve learned.

How did your family, friends, and mentors help shape the way you think and act? How can you develop your ability to in uence others in the same way and to help those around you? Poll your employees, clients, and partners to ask what makes you stand out.

Use that feedback to judge the values you’re representing, intentional or not, and adjust accordingly Think about the good and bad employees you’ve encountered.

is is an especially important exercise if you are responsible for hiring people. ink about the types of people who get the job done and who you enjoy working with as opposed to those who made your life a living hell. Again, focus on their values and how they came into play in your relationship. What are three to ve key differentiators that make you a leader in your industry?

Again, make a list and begin to focus on incorporating these traits into your everyday business life. What are you absolutely unwilling to compromise on?

ese values represent your strongest-held beliefs (trust, honesty, transparency, etc.). Make sure your people are fully aware of these values and re ect these beliefs when conducting business. How will you measure the success of your work, your team, and your company in the next 12, 36, 60, and 120 months?

Use the tangible and intangible measurements that are germane to your industry and company (i.e., don’t focus just on revenue and pro t). Consider both the positive values that will propel you to success and the negative values that might impede your progress. In the next chapter, I’ll delve deeper into one of the seven key values I shared in this chapter—challenging the status quo. You’ll discover how doing just that can create some very powerful turning points.

 

CHAPTER 4

The Courage to Challenge the Status Quo

“

If you build it, they will come.”

at’s a movie line you’ve probably heard before. It’s resonated for the last three decades since Field of Dreams was released. e lm continues to be regarded as a classic. So much so that, for the rst time in 2021, Major League Baseball played an official game at the baseball diamond specially created for the Kevin Costner movie. e sport has turned that event into an annual tradition, spurred by the love people still carry for that inspirational lm. As a movie buff, I’m one of its fans. If you’ve seen it, you’ll remember how Costner’s character, who lives with his family on a farm in Iowa, is guided by a mysterious voice to build a baseball eld in the middle of a corn eld. So he does! And his wife backs him! Now that’s a supportive spouse (reminds me of Juliet when I decided to start my own business). Naturally, to Costner’s new neighbors, he looks ridiculous. What does this guy think he’s doing, plowing under perfectly good crops, risking imminent bankruptcy, and creating a baseball eld in Nowheresville, USA? Well, the locals stop laughing when some long-dead pro baseball players begin magically appearing at the new eld to…what else? Play ball! At the end of the lm,

people begin arriving from all over the country to see them, and Costner is able to charge admission and save his bacon—or corn—because he stuck to his guns. (Fun fact: two of the extras in the stands are none other than Ben Affleck and Matt Damon.) Field of Dreams is rst and foremost a moving story about how baseball brings together a father and son. But underpinning that theme is a lesson in courage and bucking the status quo, when everybody tells you your idea is crazy, but you know it’s the right thing to do, so you do it anyway. at’s a precept my family and I live by. Sometimes it gets us into trouble, but in almost every case, we learn and grow from the experience. If you risk nothing, you usually get nothing in return. But having the courage to go against the odds and change things up can lead you to a valuable turning point you might never have reached otherwise. As you will see throughout this chapter, this holds true both in life and in business.

Real-Life Change, Real-Life Success

You might be saying to yourself, at movie is a nice little fantasy, but that kind of thing doesn’t happen in real life. Okay, I will admit that seeing ghosts and hearing voices in your head generally ends with a prescription for some pretty heavy medication. But, to me, the idea that you should follow your intuition, even when it goes against the grain, is something I strongly believe in. Because it really can lead to amazing results. Here’s a guy who proved what I’m saying. At the age of seventeen, Stanley Lieber had no higher education or training. Fortunately, he was able to earn a paycheck, thanks to the time-honored practice of nepotism. His uncle owned a comic book company and installed the young man in the offices as an assistant

in 1939. Stanley saw it as just a temporary situation, as he was determined to one day write the Great American Novel. A couple of decades later, there was still no novel from Lieber. And while he was now running his uncle’s company, there wasn’t much left to manage because in the late 1950s, comic books were on the verge of disappearing, due to many adults calling them out as violent, crass, and immoral. Many stores banned them, and many parents forbade their kids from buying them. Lieber was down from supervising twenty people to only three. And the outlook was bleak. As they entered the 1960s, Lieber’s uncle told him to start a superhero comic, because superheroes were slowly becoming popular again. Lieber didn’t take the suggestion well. As a matter of fact, he was ready to quit the whole business. He didn’t want to write another copycat comic. He was convinced he needed a complete career change if he was ever really going to make his creative mark. So he went home and talked through his difficulties with his wife. She nally told him, “Look, don’t just quit. You’ve been going through the motions for years. Instead, do this one the way you want to do it. Put everything into this new comic and see what happens. You can always quit later.” at lit a re in him. Why not? He didn’t have anything to lose, and he might as well go for it. So using his pen name of Stan Lee, he created e Fantastic Four with artist Jack Kirby and was as shocked as anybody when kids began buying up the new comic like crazy. In short order came an incredible creative burst from Stan and his artists that produced Spider-Man, e Incredible Hulk, e X-Men, Iron Man, or, and e Avengers. He also rebranded the whole line, calling it Marvel Comics, and gave every cover the same distinctive design. He pushed the boundaries of traditional comics, publishing, and storytelling in every way—in-jokes abounded and adventures

were continued from issue to issue for the rst time, just like soap operas. In short, he built the foundation for a new empire and created a host of heroes that currently rule the cinemas. Sixty years after Lieber made his bold break with tradition, Marvel movies have grossed a total of $25 billion at the box office.

My Professional Turning Point

Let me start by saying that I’m not Stan Lee. Nor do I have $25 billion in walking-around money. I’m sad to say I don’t even have $1 billion. But I did something similar when my business seemed to be in a rut, and I found myself somewhat unengaged—I completely changed things up. And what I did increased our revenue as well as my own professional satisfaction, bringing a multitude of rewards and ful llment that I still enjoy to this day. But at the time, there was no guarantee it would work. In fact, a lot of knowledgeable people told me it wouldn’t. As I moved forward with my plan, I kept thinking of how Reid Hoffman, the cofounder of LinkedIn, had described what being an entrepreneur is like: “someone who jumps off a cliff and assembles the airplane on the way down.” I knew that’s exactly what I was about to experience. Before I made the big change, we focused on recruiting for accounting and nance positions. Having done this with my previous employer for nearly three years, I was a bit tired of this particular niche, not to mention it ran counter to my personality. I’m outgoing, a little goofy, and I get my energy from interacting with others. However, I was largely interacting with people who were numbers oriented. ey were lovely and amazing people, but many were very buttoned-up, formal, linear thinkers who despised the idea of networking with strangers. So when I attended industry networking events, I

didn’t really click with anyone. And I began to feel that it was time to do something different with the business. ere were two elements to TurningPoint’s transformation. First, I wanted to recruit for marketing and sales positions, not accounting and nance. Second, I needed to stabilize our cash ow. Up until then, we operated on a contingency basis, which meant we didn’t get paid anything until the very end of the search when our client hired our candidate. is resulted in us spending a lot of time working for clients without any compensation, because many would decide not to hire the person we found for them, or they would promote someone from within instead. However, if we invoiced our clients for some of the fee at the beginning of the engagement, we could smooth out our revenue. So I changed our payment structure around to break up our fees, charging a retainer up front. Inside, I was certain these were the right moves to make, as I had spent three years at one of the world’s largest retained executive search rms, Heidrick & Struggles, and I experienced their success using this same fee structure. But as I said before, many people around me were less than supportive. “Ken, you de nitely shouldn’t do that,” they would say. “Accounting and nance recruiting is so much better, because there’s such a need for those people out there. And, by the way, nobody in San Diego’s going to pay you a retainer. It’ll be impossible because everyone works on a contingency basis.” at last part was de nitely true. I would estimate around 85 percent of the local recruitment companies worked that way, with only a select few charging a retainer. But, again, I was tired of doing so much work for so little payoff. With the contingency model, we ended up with nearly two-thirds of our clients ultimately paying us nothing. e only way to counterbalance that number as a contingent rm was with volume, volume, volume. e more

clients we brought in, the higher the likelihood we would eventually get paid. But this was an exhausting business model when you knew that 66 percent of the work you were doing would be for free. Moreover, it created a very transactional vendor/supplier relationship with our clients. In contrast, the retainer model smoothed out our cash ow. Don’t get me wrong. I didn’t just close my eyes, hold my breath, and dive head rst into the deep end of retained recruiting for sales and marketing professionals. Along with my right-hand person, Elaine, we spent a great deal of time discussing the pros and cons of this potential shift. I also spent a few months talking to my existing clients to hear their experience using a recruiter for sales and marketing positions in addition to their willingness to pay a retainer for those services. Overall, the client feedback was positive, and I had enough people saying they would use us to justify the change. Again, I channeled my dad’s mantra: “Give it a try. What’s the worst that can happen?” And I knew that if it didn’t work, I could always go back to the previous model. Practical optimism at its nest! So, in 2012, I started small, charging just a couple thousand dollars up front, increasing it to a $6,000 retainer six months later, and within two years, I moved to our current model of charging between $10,000 and $25,000 up front. Once we had 100 percent of our clients agreeing to this new fee structure, we soon found ourselves completing 95 percent of the searches we were hired to ll. By paying an initial fee, our clients now had some real skin in the game, and they weren’t so quick to dismiss the people we put forward. And because we were no longer volume-driven, we were able to offer a higherquality research and process-based approach to nding the best candidates for these higher-level positions. Ultimately, we catapulted the business into a new growth phase, with a new brand and more unique specialization, all because we took a calculated risk.

The Courage to Create Change

Challenging the status quo requires a lot of courage—and a sprinkling of good luck. As the iconic authors Jim Collins and Bill Lazier write in their book Beyond Entrepreneurship 2.0, every company has good and bad luck. e great ones seize the opportunity to act on the good luck, taking their company to the next level by maximizing what Collins and Lazier call return on luck. However, without the courage to act and drive toward real change, all the luck in the world doesn’t matter one bit, because without action, nothing will happen. Sure, it’s much easier to settle into your groove than to take chances and shake things up. And change can be risky, expensive, and time-consuming, with no guarantee of success. Frankly, that’s why most business leaders frequently avoid making big changes. Simply put, it’s easier not to change and not to act. And that point of view trickles down to the rest of the organization with predictable results. e Harvard Business Review conducted a study and came to the following conclusions: Organizations put tremendous pressure on employees to conform. In a recent survey of 2,087 U.S. employees in a wide range of industries, nearly 49% agreed with the statement “I regularly feel pressure to conform in this organization.” is takes a heavy toll on individuals and enterprises alike. Employees who felt a need to conform reported a less positive work experience on several dimensions than did other employees.14 As that paragraph makes clear, the courage to change has to be present at the very top of a company’s leadership or it rarely comes to pass. Why? Well, nobody likes to cause problems, and changing up what already seems to work

is bound to create more than a few issues. To me, the danger is greater on the other side of the equation. If you get too comfortable doing what you’ve always done, the lack of innovation and risk-taking is going to catch up with you at some point. So many companies and careers go under simply because people fail to act on, or react to, new developments in the marketplace. Times change, and we all should too. As the leader of our company, I feel it’s my job not only to push myself out of my comfort zone but also to do the same with my employees, allowing them to grow, develop, and improve their craft. I want them to feel continually challenged, engaged, and excited because there’s always something new going on. I have to call on my courage to make this happen, and they in turn have to call on theirs. In the last chapter, I introduced you to Elaine, my second-in-command, who pushed me to change when I got too enamored with coaching job applicants instead of paying attention to our core business of recruiting. Well, I’ve returned the favor over the years by frequently pushing her into taking on new responsibilities as well. Her formal title is managing partner of operations and marketing, but that covers only two of the eight or so duties she handles for us, including IT, research, HR, and our website. Over more than fourteen years with the rm, she stepped up and taught herself how to do all those things. When I rst hired her, she had no idea what skills would be required to help run our company. But as our business grew, I continuously turned to her and said, “Elaine, we need this. We need that. We need the other thing. I’m not good at any of it, and I don’t have the time to learn because it holds me back from adding value to the company in other ways.” And Elaine understood completely. She got it. She didn’t hesitate at all but instead embraced the challenges I threw at her. If I added all of her responsibilities and talents to her title, it might be longer than this entire book.

I’ve learned so much from Elaine. at’s why, when I’m hiring internally, I focus on bringing in people who complement me, are willing to push back, and are open to getting out of their comfort zone to take on new tasks that aren’t in their job description. In a business as small as ours, it’s imperative that we hire people who are willing to do whatever it takes to move the business forward. Let me be clear. Motivating my people to grow isn’t just good for the company; it’s good for them as well. About ten years ago, we brought in our rst-ever intern. She was about to graduate with a degree in marketing when she was introduced to me through one of her professors, a mentor of mine. At that time, she told me her ambition was to take on an HR job inside a corporation. e more we worked together during her internship, the more I realized how smart and talented she was. I told her she should think seriously about getting into the recruiting business, because I believed her skill set was a good match for what we do. She said, “No, no, no, that’s not for me.” She wanted to stick to her plan of nding a stable HR job inside a company rather than recruiting for a rm like ours. Well, a few months after her internship ended, she found that she enjoyed learning about the recruiting industry so much, she ended up going to work for a very large staffing company, Robert Half. Not only is she still there today after a decade but has continued to earn numerous promotions and now serves as the regional director overseeing all of San Francisco. at happened partly because I encouraged her to consider something different, even though she initially resisted. But the real credit goes to her for being open to new ideas and a different career path. Clearly, her willingness to take a chance and get out of her comfort zone really paid off. And in case you were wondering, yes, I constantly push myself to grow and develop as a leader and as a human being. at’s why, since 2019, I’ve relied on

an executive coach to help guide my professional and personal development. Actually, for a time, I was working with two coaches who were business partners (that shows you how much I needed to learn). I enjoyed working with both of them and gained a lot from their advice. en the time came when the two decided to sever their joint coaching business. at left me in the awkward position of having to choose which coach I would continue to work with. It was like my parents were splitting up and I had to choose which one to live with! Coach 1 lived in the San Francisco area. He had a sales background similar to mine and had been a very successful sales and marketing leader for several large corporations. His style was more reassuring and nurturing and less confrontational. I would end a call feeling good about myself, knowing that he really understood my perspective and why I did things a certain way. Coach 2 came from the operations and executive leadership side of the house. He had a different demeanor due to his international background running very large global companies. And while he was fair, incredibly insightful, and quite professional, he was more formal and direct. Some people might have called him too direct, as he could be very blunt at times—to the point where I got offended during one of our early sessions. So when judgment day nally rolled around, I had to weigh my options. With Coach 1, I knew what I was going to get. We were aligned, our backgrounds were similar, and I knew he would deliver his message the way I wanted to hear it. I knew that Coach 2 would call me out on my shit, hold me accountable, bring a more global perspective, and push me out of my comfort zone. It wasn’t always going to be fun, but I knew it would be extremely productive. I was con dent that he would help me continue to develop my management and leadership skills and that I would learn a ton along the way.

When all was said and done, I chose growth and slight discomfort over status quo. I knew Coach 2 would continue to push and prod me, elevating my game and opening my eyes to new ideas. at’s what you need from a coach, and that’s why I picked Martin. A year and a half later, I’m still with him, and I’ve become a better leader thanks to him.

The Courage to Address Tough Times

So far, this chapter has been largely about creating positive change, but I have to acknowledge reality and mention the importance of confronting negative change as well (another reason to have an executive coach like Martin in your corner). When trouble does arise, I have to deal with it in a proactive way to avoid having it become my new normal. at means tough calls have to be made—the kind of tough calls that require the same kind of courage I’ve been discussing throughout this chapter. Truth be told, it may even require more courage because difficult situations and wrong choices often leave us feeling helpless and depressed, questioning our ability to lead. In the introduction to this book, I wrote about the time in 2007 when Fred15 reneged on his promise to sell me his company and abruptly red me six months later. It provided the impetus to go out on my own and start TurningPoint Executive Search. What I left out of that account was the difficulty we as a family faced during the early days of running the business. All of a sudden, I wasn’t bringing in any money—but I sure was spending it in order to invest in the business as we set up the new operation. Juliet, my wife, had taken six years off to be home with our sons. at was important to both of us. But starting your own company, which she supported wholeheartedly, is a huge nancial challenge. We had already begun discussing the possibility of her returning to work in 2006, but things really accelerated

when I lost my job in early 2007. I knew things had to change if I was going to pull this off. So I eventually built up the courage to say, “Honey, nancially we need you to go back to work.” It took me a while to develop the strength to make that request—and honestly, it took a toll on my ego for a bit—but we really had no choice, and I knew deep down that she would understand. On the ip side of this discussion, it was Juliet who had to have the courage to say yes, even though she would have loved to stay home with our kids inde nitely. She understood what was at stake, and although she wasn’t at all anxious to return to work, she knew what she needed to do for our family and for my sanity. She spent the time and money to renew her therapy license, networked with colleagues, and was able to nd a job as a therapist at a therapeutic group practice in San Diego, where she worked for eleven years, until 2019. And that’s where we come to an interesting twist to this story. Over those eleven years, and being the serial entrepreneur that I am, I would gently ask her, “Do you ever think about starting your own practice?” She didn’t have my background growing up with other entrepreneurs, so she would usually react as if I had just asked her if she wanted to become an astronaut. She would always shake her head and say, “No, no, no. at’s not me.” She liked the safety, security, and predictability of working for a company where she didn’t have to bring in her own clients. I understood completely and didn’t press her. But then around the end of 2016, her tone changed. “I’m not sure I want to stay at this place,” she’d say. ey had switched up how they compensated their people, and it impacted her take-home pay (I’m thinking Fred took over the practice). She also found herself working a lot more hours than she wanted. Needless to say, this was an abrupt change, and she was now facing her own difficult turning point—to stay with the predictability and security of her corporate role or to take a risk and go out on her own.

Finally, at the start of 2018, after seeking guidance from her own therapist and industry peers, she struck out on her own. Unlike me, she had the opportunity to plan out a smooth transition from employee to business owner. She kept her primary job for a short while but gradually wound down her responsibilities at the larger rm while she launched her own practice. is was something that I never expected. After all our talks, I didn’t think she would go out on her own, because that was never her dream. But I give her so much credit for following her gut when the time was right and spending enough time formulating the right strategy that allowed her to exit her “corporate” job—and it all worked out pretty well. Now she’s working on her terms, she loves her mix of clients, and at the same time, she is earning a better income and feeling much more ful lled running her own practice. e stresses are still there, as they always are when you have your own shop, but at least she is the one driving all the decisions and developing the ideal business model to t her passion. Had she not been willing to face her diminished engagement at the big rm, she would have missed the opportunity to make this positive change.

The Ultimate Challenge to the Status Quo

If there’s a theme to this chapter (and this entire book, for that matter), it’s this: Don’t be afraid to take your professional life into your own hands (that entrepreneurial mindset that we talked about earlier). Have the courage to take control of your work life. Take charge and make your status quo what you want it to be. And although striking out on your own to start a business may not be right for you, it’s important that you remember how much control you have over your professional destiny. Sometimes it takes the courage to leave one job for another in order to connect with your true passion. No, it doesn’t always

work out, but when it does, it’s a game changer. ink about it. When you are working for someone you don’t respect, or worse, when you have a job that you aren’t passionate about, you spend forty or more hours a week under someone else’s thumb. When you work for yourself…well, you only have your own thumb to worry about. I dearly hope you have a kind thumb. I’ve told you a lot already about several unlikely entrepreneurs in my family. My wife starting her own practice. My mom becoming a real estate agent. Now let me tell you about my sister, Vicky, who changed careers several times in order to nd her professional passion. Vicky was a teacher for four years before having kids and then for another four years after her sons were born in 2003 and 2006. In 2009, after her most recent stint as a teacher, she began working for my company just a few hours a week, helping out with administrative and marketing tasks. Over time, she took on more and more hours and responsibility, eventually becoming our digital marketing manager and working thirty-plus hours a week. She’s been with us for more than eleven years. But marketing was never her passion or her lifelong dream. She enjoys it, she is incredibly effective in the role, and she’s learned a ton along the way, but it wasn’t where she saw herself long term. In 2018, Vicky decided to focus on living an even healthier lifestyle. As she made that commitment, she also decided she wanted to help others in the same pursuit. So she became a certi ed Optavia health coach, offering a unique holistic-based approach to eating and living healthier. Following this program really helped her, and she was con dent it would also help others. After all, the program wasn’t built around some crazy fad diet; it was more about changing unhealthy eating habits, adding in some healthier ones, and making sure there’s an exercise component in your life (I will stop there, so you don’t think I work for Optavia).

Now, if you recall, my mom became a real estate agent and succeeded largely because she wasn’t salesy. She would provide honest feedback and guidance to her clients rather than trying to push them into a house that wasn’t the right t. Well, my sister is very similar in that regard. She doesn’t even think of herself as a salesperson, and she despises networking. Instead, she thinks of herself as a consultant, one who’s very collaborative, truthful, and transparent—an accountability partner who helps her clients follow through on their health programs. Like our mom, she’s done very well with that approach, recently expanding her business and becoming a certi ed nutritional coach. As I write this book, she is in the midst of building out a full business and thrusting herself into the unlikely world of entrepreneurism—whether she wants to admit it or not! If you had asked Vicky just ve years ago if she wanted to run her own business, she would’ve answered just the way Juliet did: “Nope. I have no interest…it’s not for me…stop asking!” But now that she is able to take her passion for health and use it to build a business the way she sees t, she is 100 percent on board with the idea of being a business owner. If you’re not currently running your own operation because you too feel it’s not for you, telling yourself, “I have no business running a business,” I encourage you to keep that door open just a touch rather than closing it for good. If you start small, take it slow, and follow your passion, you can build a successful small business of your own, just like so many of my relatives have done. And here is an eight-step process that can help you

esh out the

framework. is is simply meant to be a very loose exercise to show you that it might not be as far-fetched as you think. •

Identify your passions and embrace what you’re good at.

•

Link the two by matching your passion to your expertise and research whether there is an industry to support your idea.

•

Map out what it would take to start your business (the nancials, the technology, the team, the marketing, etc.).

•

Con rm that people want and need what you have to offer.

•

Determine how you can put a different spin on the offering, leveraging your agility as a small company.

•

Consider the pros and the cons, balancing your practical optimism to lay out various scenarios.

•

Consult with your peers, con dants, family, coach, therapist, etc.

•

Take a chance and go for it!

Simplistic? Sure. But also true. If you love what you do and you’re good at it, there may be a way to nd your path to entrepreneurial success. All it takes is some research and the willpower to pursue it. As they say, “If you love what you do, you won’t work a day in your life.”

Action Items

I’ve talked a lot about courage in this chapter and maybe it’s scaring you off from entrepreneurship. e truth is it doesn’t require as much courage as you might think. So let me end this chapter by sharing a few pointers on how to make it happen with a minimum of pain and a lot of engagement. In other words, it’s time to make the status quo bow down before you. Minimize the risk.

If there’s one thing Stan Lee and I have in common (besides our love for superheroes), it’s that when we ipped the script, there wasn’t a huge amount at stake. He was able to use his existing comic book operation to publish something radically different. I was able to use my existing recruitment business in the same way. I didn’t have to invest a ton of money to make the switch, and I knew that if it wasn’t successful, I could always return to working for another company in my industry. In other words, don’t throw the baby out with the bathwater. Work with what you already have and build from there. Start slow.

I began TurningPoint’s transition from contingent to retained, and from accounting/ nance to sales/marketing, by mixing in a few sales and marketing recruitment jobs with our legacy accounting and nance clients. When I saw how well we were able to handle this new area of recruitment, I nally reached the point where I said, “Okay, that’s it. No more accounting and nance at all. We are going to build a niche in sales and marketing.” I also eased into the retained fee structure, increasing the upfront fee we charged new clients every four to six months as we gained more traction and credibility. It took roughly twenty-four months to get to our current fee structure. However, making this gradual shift completely changed the nancial picture of the company. Test the waters.

One of the things I did before I began to change the company was to hold a small focus group consisting of HR heads from companies I was

already working with on the accounting and nance side. I said, “We’re thinking about rebranding. Do you ever use recruiters for sales and marketing? If you do, who are they? How do they operate? And is there a need for this?” Almost all of them said they use outside recruiters for sales and marketing. But, amazingly, none of them had a go-to rm here in San Diego. Instead, they all had to go to Los Angeles or San Francisco to nd a recruiter with that expertise. is surprised me and reinforced my instinct that this was the right move for us. (is is also another example of my practical optimism: my optimistic side, a.k.a. my gut, told me this was the right thing to do while my practical side said I should do some in-depth due diligence and not just jump in, blindly hoping it’s going to work out.) Challenging the status quo successfully often brings unexpected rewards. For example, all of my former competitors, the other recruitment

rms that handled accounting and

nance positions,

suddenly became my referral partners. ey all hated sales and marketing and were more than happy to refer clients to us, just as I’m more than happy to refer accounting and nance jobs to them. My decision to rebrand created a win-win situation that was good for all of us. Another thing that bene ts everyone is transparency—being honest and forthcoming with your internal team and your external partners, even when it’s information that you may feel uneasy about sharing. I was always 100 percent transparent with my team as we rebranded the company, changed our fees, red a client, or hired a new employee. In the next chapter, we’ll discuss transparency and what it really means when you commit to it.

 

CHAPTER 5

Transparency Brings Teams Together

f you consult any leadership book, you’ll discover that virtually every one of them declares how communication is a huge factor in effective leadership. In this chapter, I’ll talk about why I believe that transparency is even more important and how approaching every interaction from a place of consistent transparency has elevated my company to new heights.

I

What Transparency Is All About

For bosses who like to wield power, put people in their place, and run their department like a efdom, transparency is not a welcome word. Conversely, when transparency is allowed to thrive both up and down the organization, it’s one of the strongest predictors of trust in the workplace. At a time when people increasingly question the honesty and motivations of individuals even in our most time-honored institutions, creating a culture of trust through transparency has never been more critical. Yet few leaders are truly engaged in that effort. A 2019 Deloitte study of CEOs found that while 37 percent were worried about their ability to create trust and 60 percent were

concerned about their employees’ perception of their transparency, only 18 percent believed they had a transparent and open culture.16 You read that right —fewer than 1 in 5 CEOs feel they’ve succeeded in fostering a transparent culture! Transparency isn’t about office gossip or airing dirty laundry. It’s about helping your people understand why the company is heading in a certain direction and the reasons behind the decisions being made by leadership. e more your people understand your actions, providing them with a glimpse into the big picture, the more comfortable and con dent they will be doing their jobs and supporting your initiatives—not to mention feeling more empowered and motivated along the way. Transparency can easily falter in the presence of bad news. Pro ts are down. Downsizing has to happen. Your industry is shifting and not for the better. You just lost your biggest customer. ese negative events are difficult to share with your people, and many leaders opt to keep their teams in the dark, lest they paint a bleak picture of the business. During the depths of the pandemic in 2020, most companies did exactly that—retreating to a hunkerdown-and-survive mode and sharing nothing with their teams about how they would navigate those uncharted waters (and these same companies wonder why the Great Resignation followed in 2021). Let me be clear. Transparency is not a one-way street. Sometimes your people have difficulty coming forward with their own bad news. ey may be clashing with a coworker. ey may have a personal issue that could impact the hours they can work. ey may even be unhappy with their immediate boss (who, no doubt, is named Fred) but are afraid to take their concerns to human resources. And with today’s stresses, they may be struggling with mental health issues. When an organization practices and encourages a high degree of transparency, everyone is more willing to share the bad news as well as the

good. at’s an advantage, since the sooner people are made aware of a problem, the better chance there is of resolving it. e worst thing for a leader to deal with is a surprise issue that no one brought to their attention. But let’s bring transparency back to how you lead. In chapter 2, I told you it’s okay to be human. Your people don’t expect you to pretend everything’s ne and to put on a happy face when it’s obvious the business is struggling. Instead, by modeling transparency through the sharing of difficult situations, you make it okay for your team to follow suit. is allows you to trust that your employees feel empowered enough to raise any concerns before they blow up in your face. ere’s a famous story about Alan Mulally when he took over as CEO of Ford. He asked the management team to share their top metrics and to label each as green (on target), yellow (off target but a plan is in place to address the issue), or red (off target without any plan to x it). One executive after another presented their key metrics displaying the same color—green. And this was at a time when Ford was losing close to $17 billion and on the edge of bankruptcy. Finally, one brave executive shared a metric that was red. Mulally gave him a standing ovation. And that proved to be a pivotal moment in shifting the culture at Ford to a place where leadership felt they could be honest with the CEO, sharing accurate data rather than telling fairy tales. Transparency is too often just another corporate buzzword with nothing behind it. It requires real effort to bring transparency to life. If you want people to trust you, you have to trust them—it’s a two-way street. If you feel like you can’t trust your team, there are four possible scenarios at play: •

You’re too suspicious.

•

You haven’t hired the right people.

•

You haven’t taken the time to get to know your team.

•

You’re a Fred and everyone hates you.

If it’s the rst, work on trusting people until they prove you wrong (my parents’ philosophy on life). Give them the bene t of the doubt and let them take a few chances. ey will not hit a home run every time, but if you never let them come up to bat, how will you know what they can deliver? If it’s the second scenario, then it’s time to re ne your hiring process. You need to bring in people who are excited by and aligned with your mission and values, who have a passion for your business, and who possess the skills necessary to get the job done. You may also need to review your onboarding, training, and retention strategies, as the disconnect may develop after they are hired (and if you need a recruiting rm to help, I may know someone!). If it’s the third situation, you must spend time with your people to understand what makes them tick. Applying a one-size- ts-all approach to management is doomed to fail from the start. Trust comes from understanding, and you can’t understand your team if you don’t spend time with them. And if you are just another Fred, it’s time to change your name as well as your personality. Ultimately, transparency comes down to treating everyone in your organization with respect by giving them access to everything they need to know to be successful in their role. e more you share, the more they share. e more you trust, the more they trust. e more you hide, the more they keep their distance, not knowing what’s lurking behind your evasiveness. Of course, there is a limit to transparency. Sometimes there are ethical or legal issues that prevent you from sharing information, particularly when it involves something an employee told you in con dence or an HR issue. Sometimes, like when you hire your sister, Vicky (or any relative for that matter), you have to keep your CEO and your family hats separate. But, for

the most part, the more you share, the stronger your organization becomes and the more trust you create. Your people will feel more committed to doing a great job—for themselves, for their leadership team, and for the entire organization.

The Three Areas of Transparency

To me, there are three areas where transparency should be front and center in your business: your team, your nancials, and your company culture. 1. YOUR TEAM

I strive to see the members of my team as more than just employees. ey’re human beings and should be treated accordingly. Egotistical leaders who treat people as the help or like a line item on a spreadsheet will create walls that can’t be broken down. Besides being open to feedback and differing opinions, I also like to do little things to boost transparency and to make our entire team feel more secure and comfortable in their positions. For example, as you might be aware if you’ve watched the news for four or ve seconds lately, we live in volatile times. e other week, when a bunch of bad stuff was raining down from CNN and Fox, I decided to email my team the following message: Hey, everybody, I know there’s an awful lot of crap going on in the country and the world right now. I just want you all to know that this is a safe place to talk about it, if you’re comfortable doing so. You guys know I run a transparent business, but sometimes it’s about more than just

business. It’s also about what we’re going through as humans, and if you’re like me, right now it feels like everything is outside of our control. Please feel free to share how you are doing, if you feel comfortable. I am happy to talk—we are in this together. Was it risky to suggest that their CEO is feeling overwhelmed or to call out the problems swirling around us? Maybe. But in my view, this is a perfect illustration of transparency—acknowledging that the world outside our business impacts all of us inside the business. I want my team to know they don’t have to bury their concerns if they are feeling out of control. If, once in a while, you feel the need to vent or commiserate with your fellow employees, that’s okay. It will help lighten the load. e odds are if you as a leader are feeling overwhelmed by world or company-speci c events, your team is probably feeling it as well. Again, we’re all people, and our shared humanity should be encouraged, not repressed. 2. YOUR FINANCIALS

I realize this is a controversial area, and those companies that are bound by SEC regulations will need to spend a good deal of time ensuring that they are not running afoul of any legal obligations. at being said, in my experience, your company’s numbers are another vital part of transparency. If you keep your people informed of what’s happening on the P&L statement, they’ll understand how the business is doing and the reasons behind each metric. is window into the company’s inner workings helps them understand the broader context of what the company needs to do to be sustainable and pro table—and more

importantly, how their speci c job contributes to the broader business goals. I make it a point to go through the nancials with my team several times each year. I talk about where we are spending money as well as our pro t margins. If there are big expenses coming up, I let them know we might be stretched thin for a while. If we’re investing in new systems or a marketing campaign, we talk about why and how much it’s going to cost. If we lose or gain clients, or if I secure a new line of credit, that information is also shared. If we have a strong quarter and will be paying bonuses, I share that as well. In general, people appreciate this kind of honesty. And the younger employees expect it. Most Generation Z and millennial workers are all about transparency— nancial and otherwise. is is even true when it comes to disclosing compensation, something that would have been unheard of even a decade ago. It throws off the older people among us (including me!) to think about employees sharing their compensation with one another. But it’s happening, whether we like it or not. You might as well do what you can to control the message, because this type of transparency isn’t going away anytime soon. For example, if you’re trying to lowball a new employee with a salary that’s not up to snuff, that person is going to nd out once they’ve been hired—because at some point, their peers are probably going to talk about what they make. If they discover that someone doing a similar job within the organization with the same skill set is making, say, 20 percent more than they are, that’s not going to y, and they are going to let you know about it (and if you don’t handle it well, rest

assured, it will be shared on social media). ey’re also going to ask about gender and minority inequities, so be prepared for that as well (more on this in chapter 8). 3. YOUR COMPANY CULTURE

Transparency must be embedded in the foundation of your company, or it’s always going to be an afterthought. You have to be honest about what your culture is—or isn’t. In the recruiting world, when we talk to a new client, we always ask, “What is your employment brand?” We pose this question so that we can nd candidates who not only possess the technical skills to do the job but also

t their culture—the way things get done at their

company. If our client is honest, then we can get a clear idea of what they stand for at their core (you’d be surprised by the number of companies that are in total denial about how they are perceived externally). Is your company one that offers a lot of ex time or the ability to work remotely or on a hybrid schedule? Do you show real concern for your people’s well-being by offering coverage for mental health and an above-average number of PTO days? Do you have a mentorship program that supports upward mobility and cross-training? Or is your company a hard-driving, go-go-go, work-sixty-hours-a-week kind of place? Do you want people to focus solely on their job description, never deviating from their lane? Do you promote quickly to make up for the 50 percent turnover that results from your employees being expected to keep their foot on the gas at all times? Are

you a pre-IPO company that will ask your teams to work weekends for nine months but will reward them with a handsome bonus post-IPO? ere’s no judgment from me on which kind of company you want to be. What I and the candidates will judge, however, is whether you own who you are instead of pretending you’re something else. Again, it comes down to transparency. at means if you’re a company that expects your people to come in early, work late, and maybe spend half a weekend at the office, you may not want to hire someone who cherishes their downtime and who isn’t going to be able to give more than forty hours a week. You want people who truly t into your culture rather than trying to make them t. Trust me, that rarely works. And the only way to nd the right employee for your operation is for you to be honest about what kind of business you are running. (If you’re not entirely sure what your employment brand truly is, consider doing anonymous surveys of your employees or check out blind reviews on Glassdoor.com. You might be surprised by what you learn!) In chapter 2, I referred to TurningPoint as one of the small giants, based on a book of the same name. ese are companies of limited size that still drive hard and focus on increasing pro tability, but they aren’t trying to grow just for growth’s sake. Empire-building can be rewarding but also incredibly exhausting—it’s not for the faint of heart. By remaining a small giant, we focus on efficiency and quality, serving as a true partner to our clients while still making room for our people to have personal lives (including me). Some companies are dedicated to becoming the biggest in their industry (following Neutron Jack Welch’s mantra of operating only in industries where they rank rst or second). Others may be stuck in start-up mode, running a

lean business that relies on successive rounds of funding, comprised of highly specialized employees who are paid premium salaries to work fty-, sixty-, or seventy-hour weeks in the hope that they will eventually see a nancial payoff in return for forfeiting their personal life for several years. en there are those rare leaders who are driven to take their company public, doing whatever they can to grab signi cant market share while operating at a loss and hitting lofty nancial goals to impress would-be investors. Again, none of these are right or wrong in their own sense. However, if your workplace is more of a pressure cooker, leaders should be honest with candidates about just how hard they will be pushed. If they know what they’re in for going into the job, they won’t have anyone to blame but themselves if they are surprised. One last word. Transparency, and with it, culture, is driven by leadership at all levels (sometimes referred to as the tone at the top). Employees pick up on management’s cues and react accordingly. If you’re some version of Fred, those cues will be negative and cynical, breeding distrust, discontent, and a few other words that start with dis. ere’s a saying in the recruiting world: People join companies and they leave managers. I’ve seen this play out hundreds of times during my twenty- ve years in recruiting, regardless of industry or the state of the economy. If you are someone’s boss, the way in which you supervise them will decide whether they stay with your company or spend their nights and weekends applying for other jobs. e company itself may be great, but if middle management is comprised of abusive nightmares, that won’t matter. Your employment experience is most impacted by the person you report to. Period.

Seeing through Social Issues

As I’ve mentioned, I like to acknowledge that there’s a world outside our business. And so do younger workers. Not only are they concerned about fair compensation but also their ethical streak extends much further. ese workers expect CEOs and other business leaders to take a stand on issues in the outside world. More than any previous generation, Generation Z and millennials are passionate about social issues—really passionate. Statistics show that of Americans aged fteen to thirty-four, they feel the following: •

Seventy percent are unhappy with the way things are going in this country.

•

Forty percent are downright angry about where America is at the moment.

•

irty-eight percent feel anxiety about the state of the country.

•

Meanwhile, only 13 percent feel positive and only 9 percent feel excited about the future.17

And those numbers are from just before the COVID-19 pandemic! Employees don’t like to see what they perceive as injustice being propped up—or ignored—by their employers, and they’re not shy about expressing their displeasure. As I write these words, Mickey Mouse is brawling with Florida. e state passed a controversial bill labeled “Don’t Say Gay,” which states that kids in grades K–3 are not allowed to be exposed to any lessons or discussions that include references to the LGBTQ community. e CEO of Disney, the state’s largest employer, didn’t make a peep about the legislation when it was rst passed. en its employees, shareholders, customers, and even Abigail Disney (Walt’s grandniece) vigorously protested the corporate stance— or lack thereof—causing the CEO to ultimately condemn the law (and

prompting Florida to punish the company economically by dissolving their special tax district). at’s a perfect example of how employees now expect CEOs to take a position on social issues. Diversity is another hot topic, not to mention women’s reproductive rights. As I write this (I have to say that a lot in this book, because the world keeps changing faster and faster), Roe v. Wade has just been overturned by the US Supreme Court. Huge corporations like Amazon are already proclaiming they will reimburse employees for travel costs if they go to another state to obtain an abortion. And then there’s the Russia-Ukraine war, which caused many American corporations to shut down their pro table operations in Russia. ose that didn’t immediately pull out of the country faced

erce backlash from the

public, so much so that, later on, they gave in and retreated from the country’s marketplace. (Who thought there would ever be an event so catastrophic that McDonald’s, Starbucks, Deloitte, and Coca-Cola would decide to leave Russia completely?) In the past, a CEO’s response to world events didn’t have a place in the office. Recently, my dad and I spent several hours discussing this very subject. He just turned seventy-six, so when I ask him what he thinks of the CEO’s responsibility to respond to social issues, he’s coming from a different time and place. He believes, as many baby boomers do, that a CEO should be focusing on their business and their customers rather than spending time grappling with outside events to placate disgruntled employees. My argument to him was that your business is your people, and your people are human, and humans have opinions. And if your people are expecting you to take a position (or are already unhappy with a stance you’ve taken), then they’re going to voice those opinions. You have to be ready to defend the company’s response to local, national, and world events in a manner that is consistent with your company’s

brand or risk dealing with the ire of your employees, your customers, and your vendors, as evidenced by what happened to Disney. at brings me to an important point about transparency—it’s everywhere. A company used to be able to keep most things private. But now, thanks to the internet, previously hidden corporate decisions are quickly made public, almost immediately after the CEO sends an internal memo. Glassdoor.com posts blind reviews of companies from former and current employees, in addition to compensation levels. eMarkUp.com busts Big Tech companies that routinely mislead us. And that’s just two of the many truth-telling websites that constantly bring daylight to information that’s supposed to stay secret. Even the Supreme Court’s preliminary brief on Roe v. Wade was leaked to the public. When he was running his business, my dad didn’t have to deal with this heightened level of transparency and the difficult task of keeping internal documents…well, internal. He could just focus on running his business. But times have changed, and we need to change with them if we’re going to keep our people engaged and passionate about their work. ey want to be reassured that they’re not being employed by bad actors—leaders who are only about the bottom line and don’t care what they have to do to achieve their nancial goals (remember Wells Fargo?). Employees want to be part of positive change, not an oppressive hierarchy or one that refuses to weigh in on the important issues of our time. As business leaders, we have to demonstrate that we’re on the right side of history with meaningful action and clear messaging to our people.

Transparency: A Two-Way Street

When you lead with transparency, it’s good for you, your business, and your people. I learned that lesson in my second official job in the recruitment industry, which was at a huge global rm called Heidrick & Struggles. It was here that I grew the most as a professional recruiter, thanks to my boss, Ron Gerevas, who I regard as a mentor to this day. He showed me what managing with transparency was all about. is was the rst Fred-free environment of my corporate career. My title was senior associate, which could mean just about anything in the business world. In my case, my responsibilities were technically limited to doing the initial sourcing, researching, and screening of potential job candidates, then presenting my top picks to Ron, who in turn presented them to his client. I wasn’t responsible for bringing in clients. I wasn’t responsible for generating revenue or any client management. at was left up to the partners like Ron. Senior associates had little insight or visibility into the nancials, what it took to land new clients, or what it was like to collect the fees we were charging. Ordinarily, that would be the end of the story for a senior associate. But Ron was determined to expand my professional horizons. He took me under his wing and showed me how the company and the industry really work. He challenged me not only to research and screen candidates but also to present the nalists directly to our clients, with him alongside me. I was on just about every call, interacting directly with our clients. is not only taught me how to communicate with boards of directors and high-powered CEOs but also how to prepare and defend my point of view if they pushed back on my recommendations. Ron knew his stuff more than most. He had once been the CEO of Heidrick and the president of Jenny Craig International, and he even worked

to revamp the recruiting process for the Peace Corps in the late 1970s. He really helped to shape my leadership style and sharpened my business acumen within the recruiting arena. None of this would have happened if he hadn’t been willing to operate as a transparent and trusting leader (there are those two words again), pulling back the curtain on the recruiting business. He didn’t have to do this, and in fact, most of the other senior associates I spoke with in offices around the country couldn’t believe how involved I was with each search. Fortunately for me, Ron saw the value of being transparent. I am so grateful to him for helping to accelerate my career by trusting me with his knowledge. He is the reason I practice transparency with my own team. I want them to grow and evolve in their roles, learning new skills and gaining a broader view of the business, just as I did under Ron’s tutelage. e challenge for any leader is keeping an open mind when their employees bring new ideas to the table. As long as they are well informed and constructive, born from employees who are genuinely dedicated to improving the operation, why shouldn’t they listen? If I’m not open to hearing new ideas, I’m cutting myself off from valuable input from the people who have intimate knowledge of how our shop works. What’s the point of that? To save my own ego? To put my ngerprints on every idea? Even if they’re correcting me on a decision I made, I need that pushback so that I can improve. If I didn’t encourage that kind of feedback, I’d be building walls, not bridges, and I would completely dismantle the trust I’ve spent so much time developing. Of course, transparency without accountability is a recipe for disaster. ere are times when someone on the team screws up, and when that happens, it’s my responsibility to let them know. Transparency isn’t always fun, but it must be a two-way street. Another lesson I learned from my dad is that you praise in public and criticize in private. (Did you hear that, Fred?) So I limit

any constructive feedback to our one-on-one discussions, ideally immediately after the incident occurred. Here’s an example. With a new employee, I will participate on calls while they screen a new candidate or run a kickoff call with a client. I’ll take notes because I want to give them honest and real-time feedback as soon as the call is done. When I follow up with that new employee, I rst ask for their thoughts on what they believe went right and what went wrong, and I don’t comment on their viewpoint until they are done sharing. en, when it’s my turn, even though they may have made a big mistake, I serve them a positivity sandwich. I start with a positive comment, then bring up the negative feedback, followed by advice on how to handle it differently the next time, and then offer a nal dose of positive feedback. A positivity sandwich is low on calories and goes down easily. It improves my chances of building trust and rapport as well as in uence. It renders my employee less defensive and more willing to listen because they can see that I have their best interests at heart and that I am not going to embarrass or degrade them. It’s important to me that my team can handle feedback of all kinds (and I expect the same from myself ). at’s why, in my hiring process, I will often ask the candidate to tell me about a time they received constructive feedback on the job and how they handled it. I want to get a feel for how comfortable they are sharing that difficult experience. If someone makes a mistake, it’s not a big deal—as long as I know they’re coachable and ready to do what it takes to x the problem. It’s really exciting when I give them constructive feedback and then see them put my suggestions into action in a subsequent interaction. It makes me feel like I’ve succeeded as a leader, and I know they are growing as a professional. What happens when a client complains to me about a member of my team? I don’t automatically go into attack mode or use it as an excuse to re

them (unlike my Jerry Maguire experience outlined in the introduction). Instead, I want to hear both sides, as it’s the fair way to deal with a difficult client situation. Again, it’s about transparency and seeing the whole picture rather than just a small piece of it. So, in a nonthreatening manner, I will ask the employee for their take on the situation by saying something like this: “I’m curious about your thoughts regarding what happened. Why do you think our client is so upset?” at’s a valid approach, because there are a lot of times when the client has misinterpreted an innocent comment or action. ere are also some clients who aren’t—how shall I put this?—the most agreeable people in the world. Some people won’t ever be satis ed, no matter what you do, and I need to take that into account. I try very hard to nurture a collaborative environment within our company. Our team excels at working together on projects by listening to each other’s ideas about how to reach our goals in the best possible way. I even cite this approach when I’m in sales mode with a potential client. I explain to our prospects that collaboration is one of our key differentiators. At other recruiting companies, clients typically have one person who ends up doing all of the work. At TurningPoint, a client will have the full team working on their behalf on every search. Yes, there will be one main contact person, but everybody in the company works on every search (including me), which means our clients bene t from the collective ideas, insights, resources, and hard work of the full team. At the end of the day, this is an enormous bene t to our clients. is type of collaborative approach also brings us closer as a team. ere are no hidden agendas, and egos don’t get in the way. My team and I talk weekly as a group, focusing on the big picture, the successes, and the lessons learned. What are we seeing in the marketplace? What are some up-and-

coming trends we should pay attention to? What are the challenges we’re seeing out there? How should we address those challenges? en we dig deeper. Maybe we talk about one client’s unique issues—they’re being unrealistic on compensation, they’re not being responsive, they’re changing the hiring process midstream, etc. en we collectively workshop the problem to gure out the best course of action. Ultimately our clients win, my team wins, and I win thanks to this commitment to collaboration and transparency.

Action Items

Want to bring transparency into your workplace? If your name isn’t Fred, I think you do. Here are a few ways to establish it. Share results, both successes and failures.

is is especially important when things aren’t going as planned. Acknowledging problems and working out how you will address them is key to building trust and a culture of empowerment. Pull back the veil around job functions and responsibilities.

Beyond speci c salaries, it’s all fair game. Every team member should know the basics of the other relevant positions in surrounding departments (within reason, of course) and no one should be dissuaded from offering—or receiving—productive advice to improve overall company performance, even in a function outside of their scope of responsibility. Be honest and communicate effectively.

Most of us are leading teams of digital natives who’ve grown up oversharing through social media sites like Snapchat, Instagram, Twitter, and Facebook. Don’t let big news linger for long before announcing it. You’re better off getting in front of and controlling the message than you are trying to dispel the rumors later on. If bad news gets out before you make the announcement, you will come across as a leader who is trying to hide something, and this will not end well. As I said at the beginning of this chapter, transparency breeds trust, and trusting others equips you with the con dence and open mind to develop a strong team internally as well as an ecosystem of trusted advisors outside the company. Having a broad external network of trusted advisors will be another huge boost to your business. Even with all the transparency and trust in the world, however, a business leader can still feel very alone, because the bulk of responsibility rests on their shoulders. is level of responsibility can make you feel isolated from everyone around you, because they can never fully understand how it feels to be the nal decision maker at the highest level. In the next chapter, we’ll talk about how to mitigate that isolation and to nd turning points with the help of your peers.

 

CHAPTER 6

Why Leaders Need to Stay Connected Uneasy lies the head that wears the crown. —WILLIAM SHAKESPEARE

ecently, my wife, Juliet, and I were watching TV when we noticed a series of clever commercials. In one of them, a man and a woman on a skydiving trip jump out of the plane, when, horror of horrors, the guy’s parachute won’t open. e woman keeps offering to help, but the guy says he has to work things out for himself, refusing a helping hand. at doesn’t end so well.

R

In another spot, a guy is bench-pressing some serious weights, but they’re so heavy, he can’t hold them up. ey end up lying across his chest, and he doesn’t have the strength to lift them off. His spotter offers to help. But this guy, just like our skydiver without a parachute, turns him down, saying, “I have to do this myself. You don’t know my family.” ese commercials are for an online therapy service called BetterHelp, and they do a great job addressing a very common human aw—our inability to ask for and accept help. (Raise your hand if you’re guilty of this. I know I am!)

is can be due to pride, ego, shame, or any number of things. But it’s a trait that many leaders share. Because they feel they have to establish their authority, they can be reluctant to admit the need to lean on anyone—even when times are tough—lest they display weakness or admit they can’t do something on their own. (I encourage you to reread this last sentence, replacing “they/their” with “I/my” to see if what I’m saying resonates.) Well, I’m here to tell you it’s not weak to admit that I (oops, “they”) need help. Seeking others’ advice and wisdom isn’t just smart business; it’s good for our mental health (just ask my wife, the marriage and family therapist). In this chapter, I’ll talk about why it’s so dangerous for a CEO or any leader to isolate themselves—and how they can develop positive connections to counteract the impulse to go it alone.

The Ins and Outs of Isolation

It’s easy for a business leader to ignore that feeling of isolation. After all, you’re managing people and connecting with others outside the company all day long. Sometimes it feels like all you’re doing is talking to people, so how can isolation ever be an issue? For starters, the majority of those professional conversations tend to be very surface level and utilitarian. You may share some small talk here and there with employees, but these relationships skew toward being transactional, rarely ful lling that human need for true bonding. Of course, when you’re working ten- to fourteen-hour days, making multiple decisions on a daily basis, carrying the weight of the business on your shoulders, guarding against competition, innovating new strategies, and so forth, you may feel like you don’t have the bandwidth for deeper connections anyway. But rest assured, the need is still there.

Additionally, leaders tend to spend a great deal of time in meetings, which can make it easy to neglect the importance of getting out of the office and in front of customers to connect and engage. If you’re not careful, this internal focus can make it easy to miss industry shifts and customer concerns. Before you know it, you nd yourself playing catch-up. And recently another wrinkle was added to the mix—the increase of remote work thanks to COVID-19. Working remotely can make you feel even more alone, running an isolated company, full of isolated employees selling to isolated customers, with the only interactions happening over Zoom. What’s a leader to do? Now you may think, Ken, you’re way off base here. I don’t feel isolated! After all, chances are good that you’re an extrovert, as the overwhelming majority of business leaders are. One survey found that in terms of the general population, half of us are introverts and half of us are extroverts. But when we look at middle management, suddenly the number of extroverts shoots up to 88 percent. And when we move further up the ladder to senior executives, introverts comprise only 2 percent of that cohort!18 And don’t forget, the de ning factor of identifying as an extrovert or as an introvert is based on where you get your energy—from engaging with others or being on your own. So, again, if you’re such a people person, how can you possibly feel isolated or lonely? Extroverts may be very adept at building lots of connections and having many friends and followers, but they’re not always good at building deeper, quality relationships. ey can be a bit intimidating to others (especially introverts) because they are so outgoing, and they always seem to have their shit together. But this frequently isn’t the case. In fact, in their heart of hearts, many leaders are lonely too.

Leaders: People Who Need People

Friendships at work are crucial for employees to feel truly engaged. An article from the Atlantic illustrated this by providing the following statistics from a study: •

More than 90 percent of people have friends from work.

•

Seventy percent said friendship at work is the most important element to a happy work life.

•

Fifty-eight percent said they would turn down a higher-paying job if it meant not getting along with coworkers.

•

Employees who say they have a best friend at work are almost twice as likely as others to enjoy their workday and almost 50 percent more likely to report high social well-being.19

Makes sense, right? Human beings are social animals, and we get a lot of pleasure and ful llment from our relationships. Unfortunately, the boss is not always recognized as a normal human being! e Harvard Business Review says that half of CEOs experience loneliness on the job—and they also admit that loneliness often gets in the way of doing their best work.20 And there’s more bad news—loneliness is also linked to a higher rate of burnout among leaders.21 And let’s pile on even more: Another huge drawback to being a leader, in terms of being socially isolated, is that they are often unaware of up-andcoming issues within their organization. As the Harvard Business Review put it, “Senior executives tend to be shielded from organizational problems and data; they are given limited and

ltered information about their operations,

employees, and customers. While time constraints make some of this ltering

necessary, having a layer of handlers who make their own decisions about what the leader should or shouldn’t see exacerbates the isolation.”22 ey go on to talk about when James Wolfensohn rst became president of the World Bank in 1995. Wolfensohn went on a series of trips to developing countries so that he could see rsthand the kinds of projects the bank was funding. But after a few of these excursions, he realized that everything was too…well, good—just like our example of Mulally at Ford from the last chapter. Every project seemed to be successful, and every person he met had a smile frozen in place. He quickly readjusted his process, straying from his official guides to see what was really going on. And that’s how he learned that a lot of the World Bank’s money wasn’t going to the people who really needed it. If, like me, you are a fan of the reality television show Undercover Boss, you’ve seen for yourself how shocking it is when an incognito CEO is exposed to the raw truth behind the scenes of their business. So, to sum up, business leaders are often isolated, which causes loneliness, which causes unhappiness, which causes them to underperform. It also causes their employees to hide bad news, which causes problems to get worse rather than getting resolved. As Frankenstein might say, “Isolation bad!” It takes a lot of work each and every day to prevent this from happening. Which, I guess, is why I work like hell to create connections inside as well as outside of my business. I’m a very social animal, and I know I need meaningful relationships and interactions to be at my best. I’m willing to bet that you do too, so I’d like to help by talking about a few of the things I do to build professional connections in order to minimize any isolation and loneliness.

Creating Internal Connections

As I discussed in the last chapter, I share as much as I can with my team by being fully transparent. While the boss-employee relationship inherently creates some degree of distance, by approaching these relationships with the belief that everyone’s in this together, I’ve been able to build incredibly strong bonds with those around me. I want to share the most powerful example of how this approach can bene t you and your team—because it happened to me. Near the end of 2014, when we were struggling as a business, there was a period when we really hit rock bottom. ere was literally less than $200 left in the business account and not much more revenue on the horizon. I hadn’t been paying myself for several months in order to keep the company a oat, and I knew this wasn’t sustainable. As a transparent CEO, my natural reaction was to talk to my team to get their input. However, I decided to share this difficult situation with several of my very close peers rst, asking for candid feedback (more on this peer group later). ere certainly wasn’t a consensus about what I should do. Several people agreed that I should share the details with my team to brainstorm ideas, but others felt that this was a very bad idea that was doomed to back re. A lot of bosses wouldn’t have thought twice about it, opting to keep this very worrisome news to themselves, until it was time for layoffs or a restructuring. e fear, of course, was that if I let the cat out of the bag and shared everything with my team, they would immediately run for the exit or, at the very least, morale would completely crash. Luckily, it’s not my nature to play things close to the vest, and because I trust my team, I decided to be completely transparent. What happened next was nothing short of extraordinary. During this same time period, a potential new client contacted me about retaining our services to ll six positions. Good news, you say? Yes and no. I

had known this company for a while, and I was aware that the leaders, all of whom were named Fred (really not sure how this keeps happening), were trying to sell the business. ey were working overtime to make the operation look a lot better than it really was, and part of that effort was hiring key talent to spruce up the place (read: put lipstick on a pig). My gut told me that anyone they hired would probably be back on the street six to nine months after the company was sold, which meant we would be putting our placements in jeopardy. As recruiters, one of our core values is to treat both our clients and our candidates with respect and honesty. We don’t want to throw anybody to the wolves. So I sat down with my team to discuss our options, saying something along these lines: “Here’s the scenario in front of us. We desperately need revenue. We’re in a very tough spot right now. And we have two choices. Do we take on this new client and the revenue it will generate, even though their values con ict with ours, and knowing it will most likely end badly for the folks we place? Or do we turn down this client because they’re bad news? If it’s the second option, then I must be honest—we have to talk about layoffs because right now, I can’t make payroll.” Needless to say, telling your team that downsizing is right around the corner is a CEO’s worst nightmare. It was the very de nition of having two bad choices. But I had to be straight with my team, and I trusted them to be straight with me. e rst thing they said was, “You know, Ken, we obviously don’t want to take on a bad client. at’s not worthwhile in the long term, and it goes against who we are.” ey then asked a few questions about the nancials and our pipeline. I said it was de nitely improving, albeit slowly. “e business isn’t here yet,” I went on, “but I feel pretty con dent that we’ll be in a much better spot three months from now.”

And that’s when they came back to me with a third option that I had never considered, because I thought it was way too big of an ask. On their own, my team volunteered to forgo their own paychecks for those three months. ey said, “Ken, we don’t want to lose anybody, and we certainly don’t want TurningPoint to go away, but we also don’t want to take on bad business. We trust that you will get us through this really difficult situation, and we will all do our part.” All of them had some money saved as well as spouses with consistent salaries, but still, I couldn’t believe what I was hearing. Rather than compromising our values or risk losing a teammate, they chose to forfeit their pay! I committed to retroactively repaying their lost compensation after those three months, feeling incredibly humbled by their huge sacri ce to keep our business going. I continue to be so overwhelmed by their con dence in me and their we’rein-this-together mindset that I still get emotional when I tell the story. ey found a resolution I couldn’t have come up with on my own, all thanks to the trust we had built over the previous seven years. I never could have imagined saying, “Sorry to tell you this, but I can’t pay you for the next three months while I try to x the business.” Employees tend to react badly to those kinds of ultimatums. But because it was their idea—and the fact that I ate, slept, and drank business development over the ensuing months—everything worked out. ree months later, I was able to repay what they had forfeited and I even paid a small bonus a few months after we got back on our feet, in appreciation for their support and sacri ce. anks to their dedication to the business, we had made it through what, up to that point, was the worst downturn our rm had ever encountered. As for the company whose business we declined? Well, one year later they were acquired and most of their San Diego team was laid off. Our placements no doubt would have been in that group.

ings did rebound, and both 2015 and 2016 ended up being record years for us. To this day, however, I don’t believe we would have come through the storm as well as we did if I had been forced to dismantle the team. Had my style been one of unilateral, isolated decision-making, TurningPoint would be a very different rm today. I forced myself to overcome decision isolation syndrome and instead consulted with my external peers, followed by my internal team, considering everyone’s input to make the hardest decision I had ever faced as a leader. Now please don’t misunderstand me. I am not so delusional as to say that every difficult decision will magically work itself out if you simply just ask your team what to do. Business—and life—are vastly more complicated than that. CEOs must regularly make difficult decisions on their own, affecting others’ lives in the process. However, developing an external circle of in uence that you can rely on for un ltered feedback with no strings attached, combined with the buildout of a trustworthy inner circle that is willing to be completely honest and transparent (putting the good of the business before selfpreservation), will ultimately result in a stronger organization and better decisions in the long run. At the end of the day, when you’re the CEO, everyone effectively reports to you. at burden can make you think that you either have all the answers (which, trust me, you don’t) or that it’s your obligation to nd the answers on your own. As President Harry Truman famously said, “e buck stops here.” Yes, it does, but before the buck pulls into the station (I may be mixing metaphors; I have no idea), others can give you a big assist. You have to trust that your team wants the business to succeed just as you do and that they also want to contribute to that success in a meaningful way. ey have valuable ideas and insights to share, because they know the business and you hired them for their insights and expertise. Don’t cut them off from adding that value.

Regardless of your title or the size and structure of your company, I guarantee you won’t have all the answers—and it isn’t realistic to expect this of yourself. As I’ve seen rsthand over the last twenty- ve years of recruiting, if you’ve done a good job hiring, there should be a lot of insightful people within your company who want to contribute. You just need to be willing to tap into that resource. Not only could it help you out of a jam but it will also decrease the distance between you and your team, ultimately creating a more engaged workforce that feels empowered and becomes more productive.

The Power of Creating External Connections

As I alluded to earlier, in this incredibly difficult situation, I also felt an obligation to consult my external advisory board rst—before going to my team—as I was interested in hearing different perspectives. And while I didn’t ultimately heed the advice of every one of my outside advisors, I believed I had a responsibility to hear them out. Once I enlisted their feedback and made the decision to talk to my internal team, I instantly felt a measure of relief. I was no longer bearing the burden of this decision alone. People who I deeply respect provided me with the guidance I needed to address an incredibly difficult situation. You may have great relationships with your people internally, but they’re still your people. And no matter how great they are, most of them will never completely grasp the immense challenges that come with being a CEO or business leader. at’s why I’m a really big believer in building an external ecosystem that extends beyond your internal team—the group I referred to earlier in this chapter as my advisory board. Having this resource is invaluable, in good times and in bad.

What you want to do—no, need to do—is spend time building a network of leaders outside your business with whom you feel comfortable sharing issues. Obviously, these should not be competitors. Instead, this group should be comprised of fellow CEOs as well as heads of marketing, engineering, nance, or whatever role happens to correspond with your current position. ey can be in the same city or virtual. If you can get a few of these peers together on a regular basis to hash out professional challenges and business issues, congratulations! You’ve successfully created your own advisory board—what’s often called a mastermind group, a concept rst coined in 1925 by author Napoleon Hill in his legendary business book, ink and Grow Rich. He studied such titans of industry as Henry Ford, omas Edison, and John D. Rockefeller and discovered that they all used mastermind groups in their professional lives. As a therapist, my wife, Juliet, also believes in this resource. In fact, she has a standing meeting every couple of weeks with about

ve other licensed therapists, and it’s proven to be

extremely helpful, especially when she is facing a particularly difficult therapeutic situation. us, creating a mastermind group is effective across industries and company structures. ese mastermind groups serve a dual purpose. Not only will you receive insights from the other members, it will also afford you the opportunity to share your best practices and experiences with the rest of the group. Engaging in these types of groups with people you trust and respect will help to lessen any feelings of isolation, and you will nd it to be extremely ful lling. My group includes myself and ve other people. Four of us own recruiting rms, and the

fth person leads the entire western region for a national

recruiting company. Our businesses are very complementary. I handle marketing, operations, sales, and C-Suite positions while one recruits engineers and developers, another handles nance and accounting, another handles legal,

and the sixth has expertise working with marketing agencies. We never bump heads over clients, but since we’re all in the same industry, we encounter very similar issues. is allows us to compare notes on the state of the recruiting business while also talking about compensation trends, fees, hiring and onboarding techniques, and employee retention. Having this kind of mastermind group (or advisory board) to bounce ideas off of is incredibly valuable. It’s so valuable, in fact, that there are multiple organizations around the world that provide a formal platform to help build your own peer advisory network. Companies like Vistage (which is based here in San Diego), Renaissance Executive Forums, Chief (which is exclusively for female executives), Entrepreneurs’ Organization, and Young Professionals Organization (YPO) exist to help busy leaders nd and build a network. And not only are there in-person groups but virtual groups exist as well, because there’s an app for that—actually, quite a few apps, including ones that connect sales professionals, CEOs, VC investors, women leaders, medical professionals, doctors, marketing leaders, and a ton of other

elds and

categories. Many of these apps have raised millions of dollars from the private sector, demonstrating the appetite that so many professionals have for this kind of networking. In the words of Sahil Mansuri, the founder of Bravado, “e concept of nding your tribe and the concept of nding like-minded people that you can kind of grow your career with is something that’s extremely compelling. at’s something everybody would want to have access to.”23 Another important component of my ecosystem is my executive coach, Martin, who I discussed in the last chapter. He continually helps me up my game by strengthening my CEO skills. He doesn’t come from the recruiting industry, but he’s run very large teams across the globe. He knows the dynamic of managing people and running a company, so he’s helpful on a whole different level. I’m fortunate to have so many smart and talented people to call

on to help me through whatever business challenge I might be facing. Had Martin been my coach back in 2014 when I was facing the difficult decision I talked about earlier, I am con dent I would’ve spent quite a bit of time consulting with him. If you’re interested in working with an executive coach, ask your peers if they have any recommendations, and take the time to do a deep dive when you interview prospective candidates. As I said, they don’t have to know your particular industry, but they do need to understand the unique dynamic of leadership—and they have to be willing to be blunt and honest, telling you the hard truths when you need them most.

Become an MVP—Mentor, Volunteer, Partner

If you really want to recharge your entrepreneurial batteries, you may want to take yourself out of the office completely in order to stay truly connected to the world outside. To do that, step away from your network of peers and nd a whole new way to meet people at different stages of their career, with different lifestyles and socioeconomic statuses, by being a mentor, volunteer, and partner—a true MVP. ere’s a big value in doing this, because it broadens your horizons, takes you out of your comfort zone, and, once again, lessens any feeling of isolation. Best of all, you can make a real difference in someone else’s life, which in turn enriches yours. I‘ve experienced this positive dynamic for myself. In terms of mentoring, every few months I am contacted by someone who is thinking about becoming a recruiter, opening their own business, or moving from an outside recruiting rm like mine to an in-house recruiter role. In each of these situations, I’m happy to schedule a thirty-minute call to offer advice and guidance to help others learn from my experiences.

Some of my volunteering efforts include getting involved with the North County LGBTQ Resource Center, various job fairs, and speaking at local universities, including my alma mater, the University of San Diego. However, without a doubt, my most consistent and rewarding volunteering and mentoring gig to date is working with Junior Achievement, which I’ve been doing since 2013. I participate almost every semester in what they call their Company Program, an entrepreneurial program for high school students. In my role, I serve as an outside mentor, partnering with the teacher of a business class at Canyon Crest Academy. Over fourteen weeks, a colleague and I work with nearly fty students who are charged with coming up with a business idea, creating everything from the business concept to its name and brand and putting together the student-executive team to run it. e class brings the product or service to life, exposing these students rsthand to how a business operates in the real world. During this program, I am reminded about the fundamentals of starting, building, and running a company and why I became an entrepreneur in the rst place. is experience in turn has motivated me and my team to hire one high school senior as an intern each semester, expanding our mentoring and volunteering beyond the classroom. Not only does this help my team and me to break up our internal focus and routine (read: minimize our feeling of isolation) but I am also hopeful that it teaches these students the value of building and maintaining connections at an early age. When it comes to partnering, I spend time every day looking for opportunities to introduce people within my network. In 2011, I created the Sales and Marketing Leadership Alliance networking group to give back to business leaders and to help facilitate more of these connections. I also provide referrals to a wide variety of other professionals in order to be a true resource to my clients, including career coaches, payroll companies, health and wellness

coaches, attorneys, other recruiters, compensation consultants, networking groups, etc. Finally, I serve on the executive committee for Talentor Global, offering advice and market intelligence to my other partner countries around the world. You might be wondering, Ken, how do you have time for all this? I’m not sure, but it all seems to work out. What I’ve learned, however, is that pushing yourself outside your employee base and beyond your advisory board to become an MVP provides other ways of avoiding the downward spiral of loneliness and isolation that often accompanies leadership. ese activities create an incredible energy that engages your mind and heart by truly connecting with other human beings, ultimately motivating you to think about things from a whole new perspective.

Action Items

e Rodgers and Hammerstein song “You’ll Never Walk Alone” sums it up nicely—if you’re willing to put in the work. e truth is you absolutely will walk alone if you shoo everybody else away, dismissing opportunities to make meaningful connections and ignoring the importance of building an external advisory board. With that in mind, here are some suggestions to help you live a less isolated and more ful lled life by staying connected to the world around you. Watch out for workaholism.

As a society, we tend to revere the workaholic entrepreneurs who put in seventy-hour weeks to create the next great company. Believe it or not, the more hours you work, the more isolated you can become—from your family, your friends, your customers, and even your employees,

who probably aren’t as eager as you to work around the clock. So examine your work habits and re ect on opportunities to ease up a bit, allowing more time with those personal and professional connections. Sometimes your brain just needs a break, so do it a favor and give yourself a rest. Be aware of your isolation.

Sometimes as a leader you don’t realize how isolated you’ve become. at’s because when you make it to a position of power, people begin to treat you differently. ey’re either too afraid to authentically engage or they overcompensate with constant

attery and a side of

bootlicking. Don’t let this become your new normal. is is where transparency and trust come in handy, creating real bonds with your people instead of obligatory, arti cial boss-employee relationships. Encourage others to challenge you, to be honest with you, and to avoid seeing you as infallible. Burst your bubble.

Sometimes you just need to get out of your office—even if it’s at home, as mine is. e more you surround yourself with work—physically or electronically—the less room you have for other pursuits, including the lost art of clearing your head. Earlier in this book, I revealed how I drove to the beach with my dog just to take a mental break. I think that sort of thing is important for everyone, especially when you’re loaded down with leadership responsibilities. We as leaders need to take breaks, and we also need to create a space where our employees won’t fear retribution if they need a break.

Another way to burst your leadership bubble is to come down from your ivory tower (or wherever your office happens to be) and interact with your team members and customers on a regular basis. You don’t have to guest star on Undercover Boss to nd out what they truly think. ey’re bound to have some insights you don’t, simply because they’re in a different position and they see things from a different perspective. Network.

Networking is a fantastic way to interact with others and to stay connected. It gives you a chance to get away from the day-to-day business to engage with other professionals from different walks of life, and it’s best if you can do this in person rather than virtually. I almost always come back from a networking event or conference enlightened with ideas for new blog posts, topics for a video, or some other new insight I can share with my team to enhance their work ow. To aid with organizing your networking, I suggest you create a connection road map that contains a plan and sets out goals for each external activity. For example, if you decide to attend a conference, de ne your priorities. Are you there for the content, the speakers, the networking, the potential business, or all of the above? You might also want to take a board of directors seat, volunteer as a speaker, or get involved with a trade association (either as a volunteer or as a member). Falling prey to a sense of isolation is a trap that’s easy for leaders to drop into. Fortunately, as you can see, there are a lot of ways to avoid that trap. Because you are a leader, you have a duty to your team, your customers, your investors, and yourself to spend the time to stay connected and balanced.

In the next chapter, it’s time to learn how to let go—of bad stuff anyway. Too often leaders get stuck in a rut of their own making. Turn the page to nd out how to blow the cobwebs off your CEO strategy and freshen up your leadership skills.

 

CHAPTER 7

Winning with Perseverance and Resilience Fall seven times, stand up eight. — J A PA N E S E P R O V E R B

hen I rst thought about the topic of this chapter, it seemed like it would be a useful exercise to consult the dictionary for the exact de nition of the two words that I believe de ne the essence of entrepreneurship:

W •

Perseverance: Persistence in doing something despite difficulty or delay in achieving success.

•

Resilience: e capacity to recover quickly from difficulties; toughness.

Reading these de nitions reminded me how well these traits work together. Simply put, perseverance moves us forward; resilience keeps us in the game. As you might have heard (especially in this book), life has its share of challenges. We all face unexpected obstacles and downright disasters at one time or another, sometimes caused by our own decisions or behaviors and sometimes by events totally beyond our control. In some instances, the

difficult days can really rattle our world to the point where we want to go home, get in bed, turn off our phone, and pull the covers over our heads. And it’s okay to do that—once in a while. What’s not okay is giving up. We all nd ourselves on the brink of quitting when faced with a very difficult situation—or worse, a string of them. But what will you gain by giving up? Not much. In contrast, what do you have to lose by trying again? e answer is the same—not much. But by giving it another go, you subject yourself to a huge potential gain. You just need to keep on keeping on (or, to quote Dory, the famous philosopher sh from Pixar’s Finding Nemo, “Just keep swimming, just keep swimming!”). You can’t argue with a sh. So why not take another swing at whatever challenge(s) you may be facing? Let me talk about a special someone who did just that. He happens to be my youngest son.

The Education of Cory

is philosophy of living a resilient life is something my wife and I have embraced since we rst met in 1987, and we hope we have passed it on to our kids. I’ve already written about how our oldest, Cass, bravely dealt with his gender identity. I’d also like to share what I observed when our youngest son, Cory, went off to college in the fall of 2020, demonstrating how perseverance and resilience are essential skills, even for an eighteen-year-old. Cory decided to pursue his higher education at Indiana University, far away from the perfect year-round weather of the California beach town he grew up in. His goal: to become exposed to a different way of living, a new perspective on life, and what it’s like to have actual seasons. He was accepted into the school’s small yet highly specialized audio engineering and sound

production program, which admits only twenty new students each year (in a college with thirty- ve thousand students total). Since there were so few students in this program, Cory wanted to get off to a good start, so before the rst semester, he connected with his future roommate and some students in his program through social media. ey all seemed to hit it off well. He also began messaging with a girl who would be attending IU that fall. ey Instagrammed, texted, and eventually even Zoomed. Cory began to feel as if they might date when the school year began. Eventually, August rolled around and Cory started his college experience. And things were great…until they weren’t. Here’s a summary of what transpired in his rst month of college: •

He and his roommate discover they are polar opposites. ey wake up at very different times, have very different ideas about cleanliness, have completely different eating habits, and have study schedules that are way out of alignment. Result: thanks to new COVID-19 restrictions, as well as the fact that they weren’t terribly compatible, his roommate moved out within the rst month.

•

As for the girl Cory had been messaging, they meet up only once, and that was pretty much the end of their conversations.

•

e twenty students who were part of Cory’s audio program were very welcoming at rst. But suddenly that went south too. ey began to exclude Cory from their chats, texts, and get-togethers, and he is left without a core group of friends.

•

And since this was August 2020, Cory was exposed to COVID-19 when someone he started hanging out with tested positive. Cory suddenly found himself quarantined for two weeks in an old musty dorm with almost no face-to-face contact with the outside world. I say

“almost” because, once in a while, a DoorDash delivery person made a cameo appearance to drop off his food. Pretty great start to college, wouldn’t you say? Cory seemed to handle this tidal wave of bad news pretty well. However, when he returned home for winter break, we half expected him to tell us he was bailing on IU altogether. He de nitely wanted to talk about the struggles he was having. But we were shocked—and impressed—that not once did he raise the idea of transferring to another school or staying at home to work instead, taking a “gap year” as many would-be college freshmen opted for during COVID-19. To me, his level of resilience and resolve was extremely admirable, especially for an eighteen-year-old. What was really impressive was his ability and willingness to look for solutions instead of just dwelling on his problems. He talked about looking outside of his audio cohort for companionship. Speci cally, there was someone he had met for lunch when he rst arrived at school but didn’t end up staying in touch with due to their different schedules. Maybe if he reached out to him to reconnect, he thought, this guy could be someone to hang with second semester. at plan worked out better than Cory could have possibly hoped for. Not only did they reconnect but he also introduced Cory to his circle of friends, and suddenly Cory had the active social life he had been craving. To make it even better, he also began dating someone he met through this new group—Kenzie—and, as of this writing, they’ve been together for two years. And it gets even better because the very next semester, Cory ended up bonding with the audio cohort that had abandoned him during his rst semester thanks to their ability to nally hang out in person and get to know one another after the pandemic restrictions were lifted. How’s that for perseverance and resilience paying off?

Many students experience a difficult start to college life. It takes time to nd your crowd, especially when there’s a pandemic raging. But feeling shut off and isolated from people you thought were going to be your friends has the potential to lead to overwhelming depression (the same can be said for starting a new job or moving to a new city). But to his credit, Cory never thought about giving up. Instead, he took the time to think it through and talk it over with us until he found a positive course of action. He didn’t dwell on the problem or get overcome by a woe-is-me mentality. Instead, he actively sought out potential solutions, took the initiative, and gave it another shot. Needless to say, that made his parents quite proud. ese are profoundly stressful times in the world, and both resilience and perseverance are more vital to our survival than ever before, whether you’re eighteen, thirty- ve, or eighty.

Don’t Stop Believing

What’s true for an eighteen-year-old college student is true for all of us, at any stage of life, even entrepreneurs and business leaders. ese twin traits of resilience and perseverance have been shown to be absolutely essential to success. In her New York Times best-selling book, Grit: e Power of Perseverance and Passion, Dr. Angela Duckworth demonstrates that it’s not talent or genius that gets us to where we want to go—it’s our own willpower and desire to succeed. As a matter of fact, those who are blessed with enormous natural skills sometimes end up quitting far faster than someone who has a deep passion for what they’re doing but has to work extra hard to reach their goals. Innately talented people sometimes believe they will get what they want just because things tend to come easily to them. Life just doesn’t work that way. Listen to

the wise words of a few special people who understand what it takes to succeed, experiencing it at the most elite levels: •

Legendary business leader Lee Iacocca: “You’ve got to say, ‘I think that if I keep working at this and want it badly enough, I can have it.’ It’s called perseverance.”

•

Sports legend Michael Jordan: “I’ve failed over and over and over again in my life. And that is why I succeed.”

•

Supreme Court Justice Sonia Sotomayor: “I have never had to face anything that could overwhelm the native optimism and stubborn perseverance I was blessed with.”

ese highly talented people reached the peak of their professions through grit, determination, and hard work. And they are far from alone. ere are numerous examples of perseverance not only winning the day but also conquering a marketplace. For example, Jack Can eld submitted his Chicken Soup for the Soul book to 130 publishers before he made a sale, and today there are more than 250 books in the series. Howard Schultz, the founder of Starbucks, went to over 200 banks looking for a loan to open his rst coffee shop. After a year of being rejected, he nally got the money he needed, and today Starbucks employs over 137,000 people. It’s never too late to create these kinds of success stories. Ray Croc was a mildly successful fty-year-old milkshake mix salesman when he founded the McDonalds chain. Colonel Sanders was sixty- ve when he made Kentucky Fried Chicken a household name. Considering my cholesterol level, maybe I shouldn’t be honoring these two guys, but you have to admire their perseverance and resilience. Finally, there’s the man who routinely wins the title of Greatest American President—Abraham Lincoln. Talk about resilience! Honest Abe’s business

failed when he was twenty-one. He lost his rst election at the age of twentytwo. He had another business fail when he was twenty-four. When he turned twenty-seven, he had a nervous breakdown. He lost his bid to become a congressperson at thirty-four and to become a senator at forty- ve—and again at forty-nine. In between those two senatorial races, he failed in an effort to become vice president. I might have just gotten a clerk job at a feed store after all that rejection. But Lincoln kept pushing forward and eventually got elected president at the age of fty-two during an incredibly tumultuous time in our nation’s history. And thank God he did. As I said, it’s easy to just give up, especially when the world seems to be showing you the back of its hand on a regular basis. But giving in to rejection only serves to guarantee your defeat. Becoming cynical and resigning yourself to failure gets you nowhere. Abandoning your dreams and aspirations will suck the life right out of you. Better to try, try again than to run for the exit at the rst or second or third sign of trouble (although, as we’ll discuss later, there are some very speci c situations when moving on is the best option). I have had some very positive role models over the years (none of whom were named Fred) who have demonstrated the power of resilience as they persevered through their own difficult situations. A quick shout-out to a few of my favorites who showed me the way: •

Philip Welp at HTC International, where, as a nineteen-year old college intern, I was allowed to let my entrepreneurial ambitions run wild.

•

Stephanie Astley at the rental car company, who was the rst person, other than my dad, to demonstrate the importance of working hard and having fun.

•

Olga, the chief marketing officer at Accountants Inc., was the rst person to recognize my natural tendency to be a collaborative, relationship-driven sales professional rather than a pushy, transactional sales guy.

•

Ron Gerevas and Pepper de Callier at Heidrick & Struggles, both of whom treated me with respect. ey took the time to listen to my ideas, hold me accountable, and empower me to make decisions while never missing an opportunity to provide on-the-spot, constructive feedback.

Each of these people shaped my ability to be resilient, to serve those I managed, and above all else to share the credit for my successes and be accountable for my mistakes.

Risky Business

Earlier in this book, I recounted a few of my not-so-wonderful misadventures at a rental car business that shall continue to remain nameless. If I had let these negative experiences get to me, they could have easily derailed my journey to success in the recruiting industry, just like Cory’s rough start in college might have stopped his education in its tracks. Even after I left the rental car company, however, I soon found myself in the grips of even more fearsome Freds. My business acumen and career con dence were both severely tested by these particularly nasty challenges, leaving me to wonder if there actually were any good bosses out there. My rst job after I left the rental car agency was selling refurbished Jaguar auto parts for a small company with only about six employees. I thought it would be a good t after my car rental years. Wow, was I wrong. e owner

was incredibly arrogant and expected me to sell parts right and left from day one, without any training—and I was supposed to memorize the entire inventory of parts within the rst few days. I realized within a week that not only did I have zero passion for this industry but I had even less respect for its owner. Inevitably, I ended up getting red for my “lack of performance.” And when that magic moment happened, he actually accused me of having my wife write my résumé for me, because, in his words, “you don’t have any of the skills you claimed to have.” I have a few regrets, but they don’t include losing that job. Two weeks later, I had a new job, this time in the wonderful world of radio advertising. For all of you younger peeps out there, radio was still big business in 1997, and radio commercials were a moneymaking industry. Unfortunately, this boss was even worse than the Jaguar parts guy! She literally came to work drunk or high just about every day—and made me want to start doing the same thing! My “training” consisted of being told to just “go out and sell anywhere, to any business that wants to buy radio ads. And by the way, don’t bother asking the other reps for help, because they are your competition, and they won’t lift a nger for you.” Gee, thanks for the pep talk! at was it. No mentoring, no role-playing, no examples of what a good ad might sound like—absolutely nothing. On top of that, it was a very niche music station with an owner who was too cheap to pay the small subscription fee to give us access to the ratings we were supposed to reference during our sales pitch. Having no idea where to begin in this ill-begotten job, every day I would climb into my olive green Nissan Maxima that I had purchased from the rental car company and drive aimlessly around coastal San Diego, holding back tears while trying to nd businesses that might be interested in listening to me sing

the praises of spending thousands of dollars for a radio spot on a station that I don’t think many people ever listened to (not that I knew for sure, of course, since I couldn’t see the actual ratings). Within six weeks, I had sold only two spots. Unfortunately, my boss was just sober enough to notice, so, once again, the axe fell, and I was out looking for yet another new job. Having two horri c professional experiences in a row can’t help but shake you up. At the rental car company, at least I was able to do my job well, despite the long hours and challenging leadership above me. After over ve successful years in the rental car industry, which I left in pursuit of a better work-life balance, I had now been red from two entirely different industries. True, I didn’t exactly get a lot of time to learn the ropes, but still, they felt like huge failures. Not only that, but it was beginning to seem like Freds ruled the world. is was a bleak situation, to say the least. So, like Cory, I faced a moment of truth: Do I allow these rejections to get the best of me, or do I continue to push forward? Do I settle for anything that offered a steady paycheck, or do I hang on until I nd a job I liked in an industry I actually cared about? Obviously, the latter option was the preferable one, but I didn’t know if I had the luxury of being so selective. I hadn’t made much money from either of the two previous ascoes, and my bank account was quickly sinking into the sunset. As I assessed my situation, I quickly realized that I had just worked for two very, very tiny companies with few resources and zero employee support—not to mention a complete lack of values and morals. I was literally thrown into both jobs and expected to sell. is is when I learned one of the most valuable lessons of my professional life and one that I share on a daily basis with executives of all shapes and sizes: Don’t chase a paycheck. If you focus on a career that is engaging, challenging, and ful lling, the money will follow.

I re ected on what had worked for me in the past. At the rental car agency, there was a solid structure and training program for all employees. I was taught what to do and how to do it. I also enjoyed what I called putting the puzzle together, whereby I had to nd a way to match up customers, cars, and nance companies. at led me to think about industries that might offer a similar dynamic. e recruiting industry felt like it could be one of them. I wouldn’t be a oneman band on an island where I was expected to sink or swim. Instead, I would be working with other people on a daily basis—the kind of environment where I tend to thrive. I would also be “matchmaking” again by connecting candidates with companies. I already kind of knew how that worked, since, at the rental car company, I sat on the other side of the table, recruiting, interviewing, hiring, and ultimately supervising a staff of ten. So with my new target industry in place, I applied to a few recruiting companies and eventually ended up with two offers. One was from a very large company that offered general recruiting for administrative and hourly jobs. e other offer was from a midsize out t named Accountants Inc., which was much more specialized (as you may have guessed from its name, this company recruited for accounting positions). I didn’t know much about the business yet, but my instincts told me that recruiting more specialized functions would be more valuable in the long run, as it seemed easier to master a niche than an entire industry. So I ultimately accepted the offer from Accountants Inc., and it was the perfect choice. Funny enough, my rst boss was yet another Fred, but this time, there was a positive wrinkle. is Fred was so incompetent, he ended up getting red, and I was asked to take over the office as the interim manager after only six months on the job!

Twenty- ve years later, recruiting is still my chosen eld, and I absolutely love it—especially now that I’m running my own company.

You’ve Got to Know When to Fold ’Em

ere are few things more humbling than running your own company. And having the ability to persevere no matter what is usually a good thing. But there are times when it’s a double-edged sword—like when you can’t stop yourself from chasing your own tail. Often it’s difficult to determine whether an idea is good or bad when you rst start working on it. It’s only when you really dig in that you begin to uncover whether it’s going to lead to something great or just a dead end. And that’s when you have to make the call, choosing from three very distinct options: •

Is this project truly worth working on in its current form?

•

Do I need to make some adjustments to really make it y?

•

Is it time to abandon ship and just let it sink?

You can believe in something all you want, but if that belief never leads to real progress, it’s time to switch gears. Perseverance and resilience only go so far. Sometimes you just need to move on with your life and let go. Let go of what, you ask? Ideas that aren’t viable. Strategies that go nowhere. Business efforts that don’t yield results in the medium term. Relationships that are one-sided, toxic, and hold you back. Employees who aren’t working out and never will. Jobs where you’re supposed to sell radio ads and Jaguar parts for insane managers. And most importantly, your ego. No matter what your role is (but especially if you’re in a position of leadership), when you decide to pursue a goal or an objective, it’s natural that

you will get emotionally invested (truthfully, if you don’t, it’s time to ask why you’re pursuing it in the rst place). And the further you take your pursuit, the harder it is to let go. Eventually, if you’re not careful, it becomes more about proving you’re right than actually accomplishing anything. If you ignore the signs of a bad business initiative—lack of sales, an absence of support from your team, a negative reaction from the marketplace, higher costs than anticipated, etc.—you’re only hurting yourself and the operation, not to mention your credibility as a leader. A true leader doesn’t allow themselves to get overly attached to their own ideas. Just because you generated the idea doesn’t mean it’s good. Instead, a true leader evaluates the incremental outcomes of their efforts, making realtime decisions about whether it’s time to change course. Sure, it’s tough to make a U-turn, especially in front of your staff and maybe even your customers, but pulling the plug when its warranted can be good for you, your business, and your people. As we talked about in chapter 5, accountability encourages transparency, which increases respect for you as a leader. In some instances, you might feel that reversing course is not an option because the consequences of abandoning the initiative might leave you with no other options. You may fear that a lack of direction is worse than heading in the wrong direction, and that fear is what pushes you to continue pursuing a bad idea. is is where perseverance can become a curse. Yes, you need a healthy dose of it in the beginning so that you can explore an idea enough to determine whether it has legs. But you must also have con dence in your own resilience—and internal bullshit meter—to know you can bounce back if you ultimately decide to terminate an ill-fated project (and once again, this is where having an advisory board is incredibly valuable). In chapter 4, I talked about how I rebranded my company to focus on recruiting marketing and sales talent rather than on nance and accounting

professionals. At the same time, I elected to change the fee structure to collect some of the fee up front. Both were monumental changes. Both were met with considerable pushback. Neither decision was a slam dunk. However, I knew in my heart of hearts that even if those changes didn’t work, I had the resilience to regroup and continue to push the company forward in other ways. I doubt I ever would have attempted these changes in the

rst place without a

foundation built on resilience and perseverance, not to mention my practical optimism. Without question, I learned these traits from my parents through their multiple setbacks in life: two bankruptcies, being laid off from a corporate VP position, a fraudulent payroll company, deceptive CEOs, and, later in life, the loss of parents and even ovarian cancer. I also bene ted from watching my parents emerge from these setbacks together, as a united front. ey continually supported each other through thick and thin, relying on their lifelong blend of practical optimism. en, in 2017, my dad was forced to battle the most signi cant event of his life on his own, when my mom died unexpectedly. I truly thought this immense loss would take the wind out of my dad’s sails, perhaps extinguishing his natural optimism permanently. He and my mom had been together since late high school, moving across the country after getting married at ages twenty-four and twenty- ve, raising two kids in Southern California, and eventually moving to Arizona in 2016, having visited and vacationed in Phoenix numerous times during their nearly fty years of marriage. While my mom had been slowing down over the previous twelve months, her death was still a huge shock. It took all of us by surprise and shook our family to the core. But my dad didn’t let this horrible setback extinguish his zest for life or his passion for moving forward. He didn’t isolate himself; he didn’t stop visiting us in San Diego; he didn’t ignore his friends; he didn’t

abandon the things that made him happy; and he didn’t ignore his feelings or become a cynic. Instead, he continued to live in Arizona while the rest of us were here in San Diego. And because it kept him engaged and allowed him to continue doing something that he truly enjoyed, he kept driving for Uber. Six years later, we see him every month or two, and he’s even visited his family and friends back in New York. He now takes regular trips to Las Vegas as well, rather than the two or three annual trips he made when my mom was alive. His desire to lead a rich, satisfying, full life pushed him through a very dark and difficult time, and I truly admire him for it. While I have not been faced with the death of a spouse, this fundamental ability to overcome even the most difficult of circumstances, handed down by my parents, has served me well as a parent, a husband, and an entrepreneur. I have certainly made my share of mistakes, too many to list here (although I’ve given you a heapin’ helpin’ of them in this book!). However, my single biggest failure as the CEO of TurningPoint has been my inability to hire a successful sales/business development manager. e irony of this situation is not lost on me, given that we specialize in placing sales professionals at other companies. But alas, in the ve years I’ve tried to make a hire, I’ve struggled mightily to nd a sales manager for my own business. Our rst business development hire back in 2016 was a very junior person who I thought I could train, knowing full well that they had minimal outside sales experience. In my in nite wisdom, I decided to give them every inbound lead—even though their job was to generate their own leads. My thought was that giving them “free” leads would help build their con dence in and knowledge of the industry. Eventually, I reasoned, they would generate their own leads. Wow, was I wrong!

Nine months later, they had generated a whopping one lead on their own and instead relied on me to keep feeding them prospects. inking that maybe they would improve if I provided them with some outside support, I hired a sales coach. ree months later, still no improvement. After eighteen months, I nally let them go (which I probably should have done eight months earlier). My second business development hire also didn’t work out too well. He started asking me for leads almost immediately, even after I made it abundantly clear during the interview process that I expected him to generate 100 percent of his leads on his own. Having learned my lesson from the previous hire, I refused to give him any leads. He lasted about ve months. Time for that perseverance and resilience to kick in. My third hire? Well, they lasted less than thirty days! ree weeks into their role, having exhausted the four leads they brought with them, they told me they “just didn’t have a passion for recruiting and didn’t believe this was the right industry.” I didn’t get it. It’s not like I was asking them to sell refurbished Jaguar parts or something… Time for perseverance to take a breather. If I gained anything from these experiences, it’s a clear understanding of how relying too much on an ability to persevere can hide the fact that sometimes you have to admit defeat and move on. Fortunately, I had learned from my previous mistakes and was getting rid of bad hires faster and faster rather than letting a negative situation get worse. But I remain resilient to this day, believing the right hire is still out there… somewhere. As the saying goes, hire slow and re fast.

Action Items

Like many other abilities, your powers of perseverance and resilience can be strengthened over time if you work at them. Here are a few ways to do just that. Build a brag book.

I just told you about three hires I made that didn’t work out. However, in between those bad apples, I hired three fantastic people. It would be easy to dwell on the bad hires, painting my hiring skills with a completely negative brush. But when I look at the big picture, I am quickly reminded of my ability to make good hires. Making those bad hires didn’t stop me from adding to our team, and I know deep inside that I have the chops to do it again. When you feel hesitant about continuing with a consequential change that your gut tells you is right, don’t second-guess yourself based on a few mistakes. No leader has a perfect record, and the best of them re ect on their full portfolio of decision-making, not cherry-picking all the good ones or all the bad ones. Unfortunately, the bad ones sometimes seem to stick in our minds forever. To combat this, I encourage each member of my team to create a brag book (which I do in the form of journaling). is document should be a record of your accomplishments, successful decisions, client testimonials, and milestones. When things get shitty or you have a string of bad decisions—and trust me, it will happen at some point—your brag book will keep you grounded. Take the rst step, even if it’s a small one.

Most of us have had the experience of approaching a swimming pool and dipping a toe in to check the temperature. Well, metaphorically, you can do the same thing with a business decision—you don’t have to dive head rst into monumental change. Instead, identify one small action at a time that will move you forward. Every small success will help you move on to bigger decisions and hopefully bigger successes, helping you to stay focused on the big picture rather than dwelling on the possibility that you could fail. If success isn’t immediate, that doesn’t mean you should give up. Take another small step and see how it feels. Assess the outcome, then take another step, and another, and another… Good things take time. Like hiring the right people, promoting someone, changing your pricing model, and rebranding. Remember that slow and steady wins the race.

When I rebranded my business, I knew I wouldn’t be able to claim victory or defeat in a couple of weeks. I knew I was embarking on a long journey that I couldn’t rush. Going into overdrive to meet an arbitrary deadline can cause you to hurry the process to the point that you end up making big mistakes, burning out your people along the way—and probably yourself as well. Usually, the bigger the change, the longer it will take to gauge the result, so give it time. I naively thought my rebrand would require six months to take hold. e reality? People still thought I was recruiting accountants eighteen months later! Ideas are rarely fully formed at the outset; they take time to coalesce. e same is true when it comes to implementing an idea.

Give your idea time to take hold and give yourself the time to make an accurate assessment of whether the results match your expectations. Change gears when necessary.

When a new entrepreneur or business owner asks me for advice, I always start with the same comment: “Don’t be surprised if you never truly gure things out, because it just doesn’t happen.” When I started TurningPoint in 2007, I thought I would have the formula for success by year three (honestly, I don’t know what possessed me to think that). Now, even at the fteen-year mark, I’m still learning something new every day, and I have yet to gure things out. As you continue to lead your business, you have to be willing to change gears, switch strategies, and take different paths when necessary—because things rarely work out the way you thought they would. Some goals just aren’t realistic. And sometimes your goal isn’t the problem. Sometimes the issue is the way you’re going about reaching that goal. Perseverance doesn’t mean you have to stick to your original plan if it’s clearly not working. I’ve found that there are always moments along the way when you have to change your approach to increase the odds of getting the desired result. ink about Cory’s situation. He changed his thinking about how to socialize on campus and where to nd his tribe, giving it another shot rather than getting beaten down by rejection after rejection. at’s when resilience trumps perseverance— you regroup and look for a different path to success. Regardless of your age, education, gender, or ethnicity, building your resilience and perseverance will serve you well in everything you do, both professionally and personally. e key is being willing to take

enough risk to allow for the possibility of failure. Relying on resilience and perseverance will get you through those losses as you move toward your next win. In the next chapter, I’ll tackle a huge issue: diversity. Whether it’s diversity of thought, gender, age, ethnicity, or sexual orientation, any business that expects to succeed long term must embrace diversity. e simple fact is that having a mix of voices and perspectives in your organization will allow your business to truly thrive and experience explosive growth.

 

CHAPTER 8

Diversity Does You Good What divides us pales in comparison to what unites us. — E DWA R D K E N N E D Y

ecently, we were doing a search for a high-level marketing position and were having a hard time pinning down what our client, the CEO/founder, was after. So we scheduled a call to clarify the candidate pro le and to ask what he was really looking for.

R

His answer? “Well, Ken, I’m really trying to nd someone who could be my friend.” My friend? at struck us as a very strange thing to say. When writing a job description, no one says, “We need a creative, self-directed, experienced leader who can also serve as the CEO’s friend.” We were eventually able to work around that requirement, with some very blunt and direct feedback for the CEO. However, it clouded his ability to effectively screen candidates. e more I thought about it, the more I realized that this CEO was expressing something out loud that most hiring managers keep to themselves: ey want to hire people who are like them—in other words, friends. Why? Because it feels comfortable. When they hire employees with similar

backgrounds, who pretty much see and experience the world in the same way, they can bond more quickly. ey don’t feel threatened or challenged. Instead, they feel reassured and at ease and tell themselves, I can see myself hanging out with this person for a beer after work, so they must be a good t for the job. Wrong! Not only does that line of thinking lead people to hire less quali ed applicants but also it causes them to unconsciously gravitate toward candidates who all look and sound the same, a phenomenon known as unconscious bias. at human inclination to surround ourselves with people we resemble explains a big part of the lack of diversity in so many American businesses— perhaps even more than overt prejudice. Companies have always been primarily run by white guys who have traditionally hired other white guys, because that’s who they know and who they are most comfortable with. Founders who are grads of Stanford or who live and work in Silicon Valley hire others who went to Stanford and live and work in Silicon Valley. ere’s nothing nefarious about this; it’s just easier and more comfortable. Don’t get me wrong. On occasion, racism and misogyny enter the mix as well. But however you slice it, women and minorities have ended up on the sidelines for the bulk of our business history for no good reason. And even in the post-George Floyd/Breonna Taylor era, it’s still going on at far too many companies, which is bad news not only for our society but also for the bottom line. When you don’t practice diversity in hiring, you risk cutting yourself off from new innovations, fresh perspectives, and different cultural considerations that if acknowledged and respected, could help you expand the market for your product or service. Leadership that avoids diversity does itself a huge disservice. No one can fully understand someone else’s life if they lack context and familiarity. Here again I have to tip my hat to my dad for helping me

understand the importance of diversity. When I worked for him as a teen at his Jack in the Box, he and I were in the minority in terms of ethnicity and social backgrounds. Most of his employees were Hispanic, and some were either kids of divorced parents or they themselves were a divorced parent, scenarios that were different from my experience growing up. Some of his employees would talk about having two or three generations living in the same house or never nishing high school, which, again, was very different from my life experience. Working with such passionate and diverse employees gave me a whole new perspective, exposing me to other life experiences. is was hugely valuable and helped shape my future as a leader and business owner. at kind of experience doesn’t happen unless you break out of your bubble, allow yourself to feel uncomfortable with your surroundings, and take the time to interact with people who aren’t like you—whether they are a different race, a different age, or have a different sexual orientation, educational background, gender, etc. As I’ve said, it’s important for leaders to push themselves out of their comfort zone on a regular basis. And that effort must include hiring people who aren’t like them but who can get the job done (regardless of whether they become a friend).

Diversity Facts and Figures

Before you dismiss me as an ultra-woke extreme liberal (I do not subscribe to the extreme woke community or cancel culture), know this—to me, it’s simply about being aware and fair. Research has shown over and over that an inclusive workplace is an advantage that delivers real bene ts. As the owner of a sevenemployee rm where there is a twenty-one-year gap between our youngest employee and me, and where I am the only male, I can attest to this personally. And I’m not alone.

McKinsey & Company, a top global business consultancy, conducted a study that revealed the following eye-opening facts:24 •

Companies in the top quartile for racial and ethnic diversity are 35 percent more likely to have nancial returns above their competition.

•

Companies in the top quartile for gender diversity are 15 percent more likely to have nancial returns above their industry norms.

•

Companies in the bottom quartile both for gender and for ethnicity and race are statistically less likely to achieve above-average nancial returns than the average companies in the data set. In other words, they lag; they don’t lead.

•

In the US, for every 10 percent increase in racial and ethnic diversity on the senior executive team, earnings before interest and taxes (EBIT) rise 0.8 percent.

e Harvard Business Review took a deeper dive into the question of how diversity affects pro tability by zeroing in on its effects on the venture capital industry.25 e authors were able to examine the decisions of thousands of venture capitalists and the outcomes of tens of thousands of investments. e ndings were abundantly clear: Diversity signi cantly improved the performance of pro table investments and overall fund returns. On the other hand, the more alike investment partners were, the lower their investments’ performance—11.5 percent lower on average when partners had shared school backgrounds and a staggering 26 percent to 32 percent lower when the partners shared the same ethnicity. Of course, diversity alone doesn’t make a business better, especially if the power remains in purely white male hands. As the Harvard Business Review put it, “Business leaders must…embrace a broader vision of success that

encompasses learning, innovation, creativity,

exibility, equity, and human

dignity…leaders must acknowledge that increasing demographic diversity does not, by itself, increase effectiveness; what matters is how an organization harnesses diversity, and whether it’s willing to reshape its power structure.”26 In other words, diversity can’t be just a buzzword or limited to a few token hires. It has to be an integral part of the company’s operation. As we discussed in an earlier chapter, innovation and risktaking without action lead nowhere. Okay, so we know diversity is good for business. But it’s also good for us as human beings because it broadens our horizons. So why has it taken so long for so many to embrace it? Well, here’s a fact that might shock you—most of us were raised to be racists! Now I’m not saying Mommy was a neo-Nazi or Daddy spent his weekends as the leader of a white supremacist organization. Not at all. As a matter of fact, your folks could have been the most tolerant people on earth. But this goes back to science and our DNA—it’s an unconscious trait that’s built into us at birth. As early as three months old, infants of all ethnicities start to recognize faces from their own racial group better than faces from other racial groups, especially if they haven’t been exposed regularly to those other groups.27 So they start reacting more positively to their own race. If all the child saw were white faces, that child will grow up not fully “recognizing” faces of other races. And it doesn’t stop there. Kids in preschool and kindergarten already begin to attribute positive traits to whatever group they identify with, whether the group is based on race, gender, or even something random (for example, kids told to root for the Mets versus kids told to root for the Yankees—talk about extreme con ict!). We are all conditioned to believe our groups are nicer, smarter, and friendlier.

A lot of this is simply due to evolution. It’s tribal. Back in the cave dweller days, you had to quickly identify groups as friends or foes. And if you failed, you might end up very dead. So our ancient ancestors worked to develop strong bonds within our group in order to create safety, support, and cooperation in the face of whatever prehistoric horror was out to get us. In other words, there’s a foundation of fear underlying all this unconscious prejudice. And fear can lead to some very unpleasant outcomes.

Battling Basic Instinct

As you can see, we’re battling an innate aspect of human nature when we pursue true diversity. But that’s precisely why we need to do it. We’re not cave people anymore (at least since the pandemic lockdowns were lifted). If we all work together, we create better results for society, especially if we break down the walls of sameness. Professionally speaking, I have spent my career hiring diverse teams and encouraging our clients to do the same. Our mantra is “We’re going to bring you the best candidate for the job. We don’t care about their gender, age, or ethnicity. ese will be the best people for the position. Period.” I am oored when we have a client tell us they want to hire only an attractive thirty-year-old female for a sales job, justifying it by saying, “Our customers are forty- and fty-year-old men, and we nd they buy more from younger women.” Needless to say, these are the types of clients we run away from. Our recruiting process is simple and objective: We send a presentation that consists of a résumé, their LinkedIn pro le, and a write-up. But over the years we noticed that even though we submit the best candidates with equal experience, the older candidates or those with more ethnic-sounding names tended to get fewer interviews.

To combat this, in early 2022, we decided to up the ante, with the goal of weeding out this unconscious bias. I realized that even though we can’t truly control who our client ultimately hires, we can control who they decide to interview. So our new process includes the presentation of blind résumés, in which the names and locations of the job candidates are removed. is makes it much more difficult to judge someone on anything but their actual quali cations. We also no longer provide their LinkedIn pro le, because obviously a hiring manager is going to click on it immediately and take a look at who this person is (translation: “Is this candidate like me?”). Once our client decides they want to interview someone based solely on their skills, we then share all of the candidate’s personal information and their LinkedIn pro le. Yes, it’s extra work on our part to prepare information for clients and remove pronouns and personal information, but it’s more than worth it considering the results. We will continue monitoring this approach in the coming months to measure the impact. Again, I’m not here to label everyone as a racist. is is unconscious bias we’re

ghting for the most part, and it’s not deliberately sinister—but

nevertheless, it’s very real. What we noticed at TurningPoint has been commonplace for some time. ere is a ton of academic research proving the point, beginning with a landmark 2004 study in which researchers used what they called a résumé audit. For this study, researchers sent employers identical résumés with randomly assigned names. e result was that a résumé suggesting that a candidate was Black (such as Jamal or Lakisha) generated fewer interview requests than one that suggested the candidate was white (such as Emily or Greg).28 ese ndings have since been replicated many times in other studies. I will admit we’ve gotten some pushback on using blind résumés from 10 to 15 percent of our clients. ey tell us things like “We know everybody in

this industry. We want to make sure we’re not wasting time looking at a blind résumé if the person turns out to be someone we already know.” I highly doubt they really know everybody, but I’m happy that the vast majority of our clients are very appreciative of our new process. Some have told me that they like having the ability to tell their board or their executive leadership team that the company is taking an extra step to bring in a more diverse mix of candidates. at’s a de nite plus for any organization. At TurningPoint, we recognize the value of having a diverse workforce, incorporating different backgrounds and perspectives into our organization. In my experience, diversity of thought is sorely lacking in many companies, primarily the result of hiring the same kinds of people from the same colleges and the same industries. It’s no wonder groupthink is so pervasive. You can’t say that we’re sexist or that we suffer from groupthink at TurningPoint, given that our staff consists of six women and me, with a robust mix of ethnicities, life experiences, family situations, colleges, and backgrounds. Here’s what it comes down to—the goal of a leader is not to hire a friend. Great hiring managers and business owners hire the best person for the job. Period. While the hire needs to t into the company culture and adhere to the same values, hiring and ring must be a business decision, not a personal one. As one of my mentors told me when I launched my company, “Ken, although it’s your company, never refer to the business as I. Instead, when you make a decision, make it clear it’s because the business needs the decision to be made, not you.” is approach to building a diverse team is relevant regardless of experience level or title. We recently hired a high school student as a summer intern, and she was of Indian descent. She was incredibly articulate and had amazing insights, but she was extremely shy and quiet, to the point where my team and I weren’t sure if she would be able to handle our corporate setting. But as I

have learned from several friends from the Indian community, this was very normal. If I had wanted to hire an intern who could also be my friend, I never would have hired this person. I’m a talker who thrives on sarcasm and humor (hard to believe, I’m sure), and I wasn’t positive she would t in with our group given that we are super-communicators and enjoy healthy debate. However, my team and I felt it was worth taking the chance to give the intern an opportunity to show us that she could do the job—while also pushing ourselves to be slightly uncomfortable. We felt she was someone who could bring different ideas to the table—and, conversely, I also thought we could help her develop her communication skills. e result was phenomenal. First of all, she did a fantastic job. She was incredibly adept at completing the research project and was amazingly efficient for a seventeen-year-old. More importantly for her, she did indeed come out of her shell a bit by the end of the eight-week internship. I am con dent that because my team and I were willing to hire someone from a different background—even with communication skills that weren’t quite developed— we all gained something. We embraced diversity, and we are better for it! Before we conclude this chapter, I want to make something abundantly clear. I am 100 percent aware of the difficulties faced by so many companies when it comes to hiring a diverse team. e truth is, there are fewer female candidates in engineering, data science, and software development. ere are also fewer LGBTQ, Black, and Hispanic professionals at the VP and SVP levels, making it difficult to bring diversity to the C-Suite. However, these demographics will never change if those of us in a hiring capacity (especially us white males) don’t acknowledge our unconscious bias and make a concerted effort to do something about it. It’s time to look for candidates in different places, to screen based on objective criteria, and to take note of the oftenoppressive groupthink that exists across our departments and organizations.

Action Items

If you want to make inclusion and diversity an important part of your organization, here are a few ways to make sure your moves aren’t just for show. And remember, this is not an HR issue. Bringing diversity and inclusion to your business must be a company-wide initiative. e tone at the top has never been more important. Revise your recruitment policy.

Hey, remember us? Our

rm did this! As I shared, we’ve recently

changed how we submit job candidates to our clients—providing them with blind résumés that lack any personal information. Internal recruiters and hiring managers can petition for this change within their own organizations as well. Here are some other ways to boost diversity. Seek referrals from diverse employees. Advertise

speci cally

to

minority

groups

through

collaborations with historically Black or Hispanic colleges. Develop partnerships with local colleges that support females in STEM. Write job descriptions with more inclusive and less maleoriented language, avoiding such terms as bold, aggressive, and hard-charger. (Studies have shown that these terms tend to dissuade female professionals from applying). Include employees in the decision-making process.

Diversity doesn’t mean much if you’re not giving those employees a voice in your organization—this is the inclusion part of DEI. Different groups will add a unique voice to the conversation and broaden the thinking within the company. Feeling listened to and respected also empowers underrepresented groups to excel simply because they feel they have a personal stake in helping their team, department, and company to succeed. Leadership should also meet with and create affinity groups for diverse employees to get valuable feedback on company culture and the internal effort to represent and respect all backgrounds. Bring diversity to leadership.

If your executive team is comprised primarily of white men and minorities are noticeably absent, your company’s diversity initiatives may not be seen as genuine or effective. At the very least, you’re sending a message to diverse employees that they’re probably not moving up the corporate ladder anytime soon. Equality and equity aren’t fully realized until leadership is proactive in helping diverse employees advance. is makes all employees feel welcome and supported while improving your employment brand. Honor and celebrate differences.

According to a Randstad study, 56 percent of female workers and 52 percent of male workers believe their employers could do more to promote gender equality and diversity.29 at means different backgrounds and beliefs should be recognized and celebrated, including religious practices and cultural habits. My oldest son, Cass,

recently started a new job with a midsize retailer based in San Diego. Part of the onboarding training was a video that addressed everything from sexual harassment to business etiquette and approved behaviors. One segment of the training also included a primer on LGBTQ, transgender, and nonbinary employees, including terms and why using incorrect pronouns is considered so disrespectful. All it takes to build bridges and encourage diversity is an acknowledgment that we are not all the same. By taking the time to understand those differences, your entire workforce feels included and workplaces are more cohesive and pro table. Remove “college degree” as a requirement for every white collar job.

Statistics show that while 44.3% of white men have a college degree, only 26.5% of black men are degreed; requiring a degree rather than focusing on skills will reduce your ability to attract a more diverse team.30 In the next and nal chapter (please don’t be sad), I’m going to take a look back at how the COVID-19 pandemic threw businesses (including mine) for a huge and unexpected loop, forever changing the way we manage. ere’s still a lot of turbulence in the air, so buckle your seat belt and let’s talk about how we can weather the continuing storm of business uncertainty and volatile world conditions—without losing our collective shit.

 

CHAPTER 9

The New Abnormal—or Don’t Let a Good Crisis Go to Waste The infallible leader is out. Leading with an apology, acknowledging what you don’t know, and asking for help—these are the currency of leadership in the new normal. — DAV I D PA C H T E R , R E M OT E L E A D E R S H I P

W

here were you in March 2020, when you realized the world was about to turn upside down?

e COVID-19 pandemic unleashed a number of economic shockwaves that are still coming our way as I write this book. When it rst hit, some companies were instantly knocked out of business. As time went on, others were able to radically revamp how they operated in order to remain in business. Supply chains were torn apart, and shortages hit us all where we lived (remember when you couldn’t nd toilet paper anywhere?). is was followed by six to nine months of employee furloughs, layoffs, bankruptcies, companies retrenching and restructuring, and, unfortunately, many businesses closing their doors for good. And then, less than twelve months after the pandemic began, workers began resigning en masse, prompting the Great Resignation.

How does that make any sense? e average business owner, watching all of this unfold, couldn’t help but freak out. Hell, the average person was really freaked out as well. It’s pretty clear that, moving forward, business as usual is no longer a workable concept. e world is so much more uid these days. So as we reach the end of this book, it’s a good time to draw from our experiences over the last few years, to get our heads around what we can do to push through the huge, life-changing, neverending turning points that will inevitably come our way.

Our Turning Point

In March 2020, our company, TurningPoint Executive Search, was a roaring success. We had been in business for thirteen years, we had weathered the nancial crisis of 2008–2009, we had navigated our rebrand in 2011–2012, we had dealt with three bad hires in sales, and we were off to another strong start to the year. Just before the economy began to shut down, our team was handling six executive searches, all of which were progressing quite nicely. en COVID-19 hit, and all bets were off. Two of our searches were put on hold, four of which we would eventually ll, and one of which ended up coming back about a month later. So despite the global pandemic surging, we lost only one engagement, and our rst quarter turned out to be pretty strong nancially. en the good feelings vanished. During Q2 of 2020, we launched exactly zero new searches. Nada. Zip. Bupkis. And Q3 was only slightly better. Prior to this, we had been averaging around $100,000 per month in revenue. Suddenly we were making $30,000 to $40,000—per quarter.

Like many CEOs, I wasn’t prepared for this nancially. Of course, few were, but, thinking back, I should have had a backup source of funds (e.g., a line of credit) for exactly this kind of unexpected disruption. But I didn’t. What I did have was the ability to secure a PPP (Paycheck Protection Program) loan offered by the government to businesses such as ours to help us navigate these new, uncharted waters. Securing this government loan was so complicated, however, that we had to hire an outside expert to help gure out the application process. at rst loan of $120,000 in September 2020 got us through the initial shock and allowed me to keep everyone on the payroll. And once again, in order to preserve capital, I was unable to pay myself for a couple of months. en, a few months later, the Treasury Department issued guidance allowing for a second PPP loan, and you better believe I was rst in line. By Q4 of 2020, I had received loans totaling $210,000 to keep the ship a oat while we all tried to gure out the new abnormal. And while we were stable nancially, unfortunately none of us had much to do since the recruitment business was still in the toilet. e challenge was to gure out how to do something productive instead of just sitting around, twiddling our thumbs. But while there wasn’t much revenue coming in the door, at least we were no longer bleeding cash. It was time to invest in our future. Armed with these loans and a lot of time, we decided to deploy some of the PPP funds to enhance our marketing efforts. We freshened up our online content and created more blogs, videos, and thought leadership pieces to build our brand, planting seeds that we hoped would eventually sprout into a prosperous future. It was the perfect time to embark upon these new initiatives because we never seemed to have the time to do it when business was booming prepandemic.

I continued some of my business development efforts, even though nobody really needed recruiting services. However, I shifted my client discussions, talking to dozens of companies about how they were weathering the storm and where they saw the market heading. I was genuinely interested in hearing how everyone else was reacting to the crisis, and I had a sense that other CEOs were curious as well. Yes, we needed revenue. But the goal wasn’t to sell. Instead, I wanted to demonstrate to our clients that I understood—and felt—their pain. is period was about empathy, not revenue. I wanted them to know that this wasn’t about a commission or a transaction. It was about maintaining and strengthening our long-term relationships as we all worked our way through those incredibly stressful times. In other words, much like the situation in 2014 when we had to choose between taking on bad business or potentially laying people off, we weren’t going to compromise our guiding principle: relationships before pro t. Once again, I have to say it’s easy to stick to your beliefs when everything is peachy keen. But when the virus hit the fan, and everything was crashing down around you, that’s the true test of how strong those beliefs really are. I didn’t want to appear tone deaf to the challenges being faced by so many businesses across the globe, so I focused my attention on bringing people together to discuss strategies for survival and innovation. To further support our business community and provide valuable market intelligence, I decided to create a market survey out of these conversations, highlighting how CEOs were keeping their businesses a oat. I asked questions like: What are you doing that’s different today? Are you pulling forward any product releases that were initially slated for 2021 or 2022? Are you laying people off or making strategic hires? Are you making any new investments in existing product lines to further innovation?

We posted the results of our informal survey in July 2020, and the report got a lot of engagement. e results follow: •

Forty-one percent of the companies I talked to had laid off or furloughed staff.

•

Ten percent cut salaries.

•

Sixteen percent added staff.

•

Twenty-eight percent added new products or services.

at last data point was signi cant, because that 28 percent represented companies that were taking a risk by changing things up to deal with the pandemic, when no one really knew what the next 30, 90, or 180 days would bring. Because of that willingness—and need—to quickly adapt, these businesses were surviving, and even thriving, because they were open to creating change that would address the new abnormal head-on. After speaking with almost ninety company leaders, my key takeaway was this: External change requires internal change. You must be willing to make dramatic moves in your business when everything around you is in ux. You can’t stick to the same old script when the business landscape becomes so radically different. COVID-19 obviously wasn’t going to go away in a week or a month. And those businesses that stuck to their old playbook, sitting around doing nothing new, were bound to fail. In our case, because we had built such strong relationships with our clients during those initial dark days (and in the months and years leading up to the pandemic), our business came roaring back beginning in the fourth quarter of 2020. Many of our legacy clients returned in droves, as they began to rethink their corporate structure and address areas that required a talent upgrade. is

resulted in a record year for us in 2021, with our revenues up by 19 percent over 2019. To shore up our revenues even further, I launched a new division in February 2021 called GrowthPoint. is was in response to requests we were receiving as the pandemic’s impact was beginning to ebb. Multiple companies were coming to me and saying, “We need to hire somebody. ey’re not quite executive level, so we can’t really justify paying a full-blown retainer fee. But they aren’t entry level or junior positions either, so we can’t rely on a job board.” In keeping with my willingness to take a calculated risk, once again my team and I innovated, developing a whole new fee structure that eliminated the upfront fee, delaying it until the rst round of client interviews. I also hired a recruiter to handle this new initiative. is was an idea we had loosely contemplated before COVID-19 hit, but we quickly saw it as an opportunity to craft a unique solution for our clients that would solve their hiring problems without compromising our revenue model (in 2021, nearly 20 percent of our revenues came from this new division that didn’t even exist in 2020). Like many CEOs in early 2021, while rolling out new initiatives and monitoring our customer engagement, I was also spending an incredible amount of time managing and forecasting cash ow. Obviously, no one on my team was receiving any commission, and until we secured the PPP loans, it was very tough paying their salaries as well. It was a real guessing game for many small businesses like mine, as we had no idea whether the return to revenue growth in late 2020/early 2021 would be sustainable. Additionally, no one knew whether the Treasury Department would forgive the PPP loans or if we would eventually be required to repay them (a prospect that was more unpopular than the virus itself ). Finally, to my relief, new regulations were released regarding the PPP loan, and because our loans were relatively small, they were forgiven in Q3 of 2021. We could nally focus

100 percent of our time on our core business once again without having to deal with any debt hanging over our heads (as opposed to the people who used the loans to buy yachts and luxury cars—they got into a bit of trouble with Uncle Sam). So, yes, we had to constantly scramble and adjust our approach during those treacherous months. But, fortunately, our business made it through a very dark time.

Make the Most of the Worst

So that’s how we handled the pandemic. ere were many, many sleepless nights, lots of time spent wondering what I would do if recruiting never fully recovered, and numerous calculations about how much we would pay in penalties if my wife and I were forced to take distributions from our retirement plans just to pay our bills. I’m sure, if you’re a business leader, you had to tackle similar challenges. And I hope you were able to persevere. But now comes the big question: How do we prepare for what’s to come when we have no idea what that might be or when it might happen? e chaotic times on planet Earth seem to be getting more volatile. So how do you deal with this degree of uncertainty and the constant need to innovate, take risks, and perhaps even reinvent your company and your leadership style? How do you deal with the phrase it’s always something when the somethings keep getting bigger and scarier? It’s important to realize that no matter how much you prepare, there’s only so much you can do. As my wife, Juliet, tells me, you can’t control events—you can only control your response to them. And, again, she’s a therapist, so she should know. Freaking out and running around in circles ailing your arms about isn’t going to help (and it will make you look ridiculous as well). What will help is thinking rationally about your options, considering best- and

worst-case scenarios, conducting market research if possible, reaffirming your corporate mission and vision, and, most important, communicating with your team along the way. But then it’s time to act. Don’t allow yourself to get hung up on paralysis by analysis. Eventually, you have to put your plan into action and try something new. And if you and your organization fail to establish your core values when times are good, it will be nearly impossible to keep them alive and well during challenging times. You need guardrails to keep yourself in check. Your employees need to know that you and your executive team are unwilling to compromise your value system. I would argue that the previous chapters are a playbook on how to be prepared for the worst, even before you are faced with an actual emergency. Here are four of the values we discussed earlier that I think are particularly important to enshrine in your organization to prepare for the inevitable challenges ahead. 1. TRANSPARENCY

A recurring theme in this book is the need for transparency (which we tackled head-on in chapter 5). If you’ve already put that value into practice, then you should give yourself a gold star. Congratulations— you’ve created an atmosphere of trust and honesty where your employees are free to roam about and share their opinions. is mutual trust and empowerment will serve you well when turbulence strikes. If you have open and honest relationships, you’ve got your best shot at making it through a crisis. I know it helped us tremendously—on more than one occasion. roughout 2020, I made sure everyone knew what was going on with our nancials as well as with our PPP loans. ere were no surprises, and my people appreciated knowing exactly what was happening during those unpredictable times.

Because of our willingness to be candid and honest with each other, we were also able to brainstorm as a team to gure out what we needed to do to stay a oat. How could we save money? What expenses could we put off? Where could we cut back? How should we put our free time to use? How could we pave the way for more revenue in the future? e whole team was involved in those company-wide decisions and pitched in to help us make the best calls. 2. CONNECTION

We discussed this one in chapter 6, where I emphasized that connected leaders who work hard to stay connected—both internally and externally—are happier, more ful lled, more well adjusted, and better able to read the room when dealing with employees and clients. By avoiding isolation, they’re also much more in tune with broader market trends and business cycles. However, as we all know, our ability to stay connected was a huge challenge during the pandemic. Networking events and trade shows disappeared overnight. With the massive shift to remote work—from only 9 percent of jobs being remote in 2019 to nearly 80 percent in mid-2020—a leader’s ability to easily stay connected to their team also vanished. Many had a hard time making the transition to remote management because they were accustomed to supervising and evaluating people who were sitting just down the hall, relying instead on what I call line of sight management. When that visibility was removed, leaders became insecure. And rightly so. ey felt lost because they couldn’t see what their people were doing, and they hadn’t

taken the time to set up alternate lines of communication prepandemic. is is where a culture built on trust has the upper hand. Moreover, a company focused on outcomes rather than on hours worked is better equipped to adjust their work ow and remain productive long term. Are your employees delivering the outcomes you expect? If so, you shouldn’t worry about whether you can physically see them working. What’s more important in this new abnormal/work-from-home dynamic is setting clear expectations with your team, equipping them with the tools to get the work done, and scheduling regular conversations to offer support and track their progress. at conversation shouldn’t be an interrogation, designed to question them about what they’re really doing all day. Who cares? If the work is getting done, give them that autonomy—they’ve earned it. Instead, you should be engaging with them to keep the relationship intact, to build rapport, and to remind them that you’re human too, experiencing many of the same stresses in the new abnormal. Having an actual talk—yes, using your mouth to make words rather than your ngers to push keys—is much more effective in a work-from-home world. It creates stronger bonds and better communication, lessening the chance of misunderstanding one another (which we all know is very possible when you’re sending what you thought was an innocent email, only to nd out that you offended the recipient in some way). And the chances of a misunderstanding taking root are sky-high if you hired someone during the pandemic and they never got the chance to build rapport with you or fully understand your social cues and how you and your team communicate. If you or someone who works for

you employs sarcasm or humor so dry it makes you thirsty, a new hire can easily misinterpret a written joke or snarky remark as offensive or critical. Connection, like transparency, builds a stronger team that will be more motivated to pull together to overcome a challenge. at’s a quality you’ll need when trouble hits. 3. RESILIENCE AND PERSEVERANCE

is power pair, detailed in chapter 7, may be the most important characteristics for any leader. McKinsey & Company conducted a study on how businesses responded to the pandemic and discovered that resilience was critical to the success of those that prospered in spite of COVID-19. at same research shows that in the pandemic, high-performing companies invested more time than others in clarifying their goals and setting strategy (business model resilience). ey established small, cross-functional teams and empowered them to act (organizational resilience). ey spent more time coaching and recognizing employees (also organizational resilience). ey made hours and roles more exible (operational resilience). And they spent more money on collaboration technologies (digital resilience).31 Companies that made the commitment in these areas found that— surprise, surprise—they could quickly shift their business model and perform dramatic pivots in a matter of weeks (initiatives that might have taken them a year or two in the before times). eir ndings also jibed with the informal survey I conducted—those that made smart,

bold moves pro ted from them and continued their innovation into 2022 and beyond. McKinsey also looked at the top 20 percent of companies (ranked by total shareholder returns) during and after the 2008 nancial crisis. ese businesses outperformed in the months leading up to the crisis, during it, and then extended their lead in the years that followed. What the research revealed was that they took two sets of actions to bolster their resilience: (1) they created a safety buffer for exibility, and (2) they cut costs before others did. I get that—now. As a business leader, the best time to create a backup plan and secure a loan or line of credit is when you don’t need them. I remember during that rough patch in 2014 when I tried to get a loan from a bank where I had been a customer for years. eir answer? No. ey told me I couldn’t get the money because our business wasn’t pro table. I said, “Yeah, I know I’m not pro table. at’s why I need the loan!” eir response, “Come back to us when you’re pro table.” I thought, Why would I come back for a loan when I’m pro table? I won’t need the money then. Catch-22, right? So much for strategic banking. It took me a while, but I gured it out. When things did improve a couple of years later, I went back to the bank and asked for the loan I didn’t need. And it was approved. So if your business is going well, it’s time to develop your contingency plans B, C, and maybe even D. Go ahead and get that line of credit while you’re at it. Sound business

leaders hope for the best but plan for the worst because we all face a black swan event at some point. Having this safety net will strengthen your resilience and your ability to persevere while also letting you sleep a little more soundly at night. 4. PRACTICAL OPTIMISM

I chose this title for the book for a very speci c reason. Maintaining this balanced mindset is incredibly important at all times. When times are good, this mentality allows you to take small, calculated risks rather than betting the farm on a new idea, something the iconic Jim Collins describes in his seminal book Great by Choice as ring bullets before cannonballs. en, when a crisis hits, you can still bene t from this blended approach to leadership by relying on the work you did to prepare for exactly such an event. Believing in your ability to make it through the rough patch and having faith in your problem-solving skills will equip you with the courage to take the necessary steps to remedy the situation. I believe the ability to be practical yet optimistic is what fueled so many successful leaders during the pandemic. ey didn’t ignore the farreaching problems created by the global economy shutting down. ey didn’t overreact when everyone had to start working from home overnight. ey didn’t run out and convert their entire business into a company that makes toilet paper or hand sanitizer. And they didn’t compromise their values. Instead, they took calculated risks, they used their mission and vision to keep them on track, and they found ways to make their business work, despite the massive upheaval.

And that’s what all business leaders must do. During and after the Great Recession from 2008 to 2010, I had the time and space to truly innovate and assess the market, resulting in my decision to completely rebrand the

rm to focus on sales, marketing, and operations

recruiting, moving away from our legacy accounting/ nance solutions. is practical yet optimistic decision fueled our growth, allowed us to create an expertise that many of our peers did not possess, and ultimately made me a happier and more ful lled CEO. A crisis forces us to look at how we do business through a different lens. e CEO of Google, Sundar Pichai, recently said, “Scarcity breeds clarity.” How profound is that? When things get difficult, the need to be more practical can spur you to make long-overdue yet extremely positive changes. As a practical optimist, I have constantly challenged myself to be open to whatever comes my way, requiring me to make the most of a bad situation.

Action Items

Here are a few other survival tips to refer to when you face a new version of future shock. No one trusts a robot, so be real with your people.

At the beginning of this chapter, I quoted author David Pachter, who wrote a book titled Remote Leadership.32 Well, I’m about to quote him again, because he’s a smart guy. He makes the point over and over that top-down leadership isn’t going to cut it in this new age of business, especially with remote work becoming such a large part of that

evolution. To Pachter, “Work from home has pancaked the idea of leading with old-fashioned authority like asphalt under a steam roller.” So be as human as possible. You will need your people on your side to make it through a crisis. Embrace uncertainty.

e ability to lean into ambiguity is incredibly important for a leader. Don’t expect things to go as planned because they never do. One of my favorite expressions is this: “Life is what happens while you’re making other plans.” Nowhere is this truer than when you are running a company. With that in mind, put some reusable methodologies in your toolkit that can bring structure to chaos and clarity to confusion. It’ll take time to develop this expertise, but don’t worry—the world will provide lots of opportunities to hone your skills. Lose what’s not working, then nd what will.

It’s easy to get lost in a crisis, but it’s helpful to focus on solutions rather than xating on the problem. Remember your core values and what your company stands for. It’s not all about revenue or growth for growth’s sake. Be willing to change things up as necessary, adjusting your metrics of success along the way to re ect the new world order. e old ways of doing things may no longer be applicable, so accept that reality and keep everyone aligned with the activities that will bring the greatest success.

 

CONCLUSION

It’s a Wonderful Life

s I was looking for some appropriate quotes to put in this book, I came across one that stopped me in my tracks. It was from Ben Horowitz from the legendary VC rm Andreessen Horowitz, who wrote, “If you don’t like choosing between horrible and cataclysmic, don’t become a CEO.”

A

Part of me can relate. As a business owner, every so often you encounter a crisis without an immediate or clear path to resolution. roughout this book, I’ve shared many examples of situations that, frankly, could have derailed my career, and I’m sure you’ve faced a few extreme challenges yourself. But as you’ve also seen in this book, it’s never hopeless. ere is always a way through the malaise, if you’re willing to be a practical optimist—someone who knows how to persevere, change things up when necessary, ask for help, and trust in the people around you. I began this book by talking about the movie Jerry Maguire and how it mirrored one of the most signi cant crises of my life. I’d like to close the book by referencing another classic lm that offers hope and inspiration in the face of adversity—It’s a Wonderful Life, my favorite holiday movie in which star Jimmy Stewart faces his own choice between horrible and cataclysmic. Stewart is at a point where he’s sacri ced most of his dreams to help the people in his

town of Bedford Falls. He never ful lled his desire to travel the world; he never made much money or built business empires; and he never got out from under the family business, where he nds himself up against a nancial crisis that could land him in jail, even though he did nothing wrong—other than trusting his absentminded Uncle Billy with the daily deposit. As a result, Stewart feels lost and alone with nothing to show for his lifetime of hard work, sel essness, and sacri ce. Occasionally, this is exactly what it feels like as an entrepreneur. At times you feel as though there isn’t any viable path forward in spite of your sixtyplus-hour weeks, lack of sleep, and constant preoccupation with growing your business. But if you’ve spent the time to develop a strong ecosystem of con dants outside the company and you’ve built a team that’s trustworthy and you’ve treated them with respect, empowering them to do the job you hired them for, then both your internal and your external teams will be there for you when times get tough. I found that out when I couldn’t afford to pay my people for three months (as related in chapter 6), and they volunteered to continue working anyway to keep the company a oat. Just as the citizens of Bedford Falls rushed to save Jimmy Stewart when he was at the end of his rope (except for that creep, Mr. Potter!), my team was there for me when I was sure everything was falling apart. You could say I’m lucky to be surrounded by such wonderful professionals —and you’d be right. But if you pressed me further, I would also say you make your own luck, and as we discussed earlier, it’s what you do with that luck that separates the mediocre from the exceptional. If you ght against a life of isolation by fostering transparency and vulnerability with your network, eventually, when your back is up against the wall, you will nd yourself with access to an over owing reservoir of goodwill from people who genuinely want to help. Just like George Bailey, you’ll look around at the people in your life

and realize that your friends, family, employees, mentors, colleagues, and peers are there when you need them most. (Okay, maybe our old pal Fred won’t return your calls, but then again, why would you ever call him in the rst place?) For me, the reality is that being an entrepreneur is incredibly rewarding and engaging, even with the occasional stroll through hell. For all the challenges and difficulties that we business leaders face, there is a lot more good than bad. You feel like a proud parent when your employees do well. And you feel invigorated when your business is thriving. Not only that, but it’s indescribably gratifying to help your customers solve a problem with a solution provided by your company. In the recruiting business, when we make a placement and that person directly contributes to an increase in revenue, a new marketing campaign, or a streamlining of processes, you feel like you had a hand in that success. ere are so many positive things that can come out of entrepreneurship that it’s well worth the stress. Finally, let me go back to a movie I referenced in chapter 4, Field of Dreams. At the very end, after Kevin Costner’s character has built a baseball eld in the middle of his corn eld, the late, great Ray Liotta, playing the ghost of iconic baseball player Shoeless Joe Jackson, turns to Costner and tells him he can’t follow him into the mysterious corn eld. Costner gets angry, leading to this exchange: Costner: “I did it all. I listened to the voices. I did what they told me, and not once did I ask what’s in it for me.” Liotta: “What are you saying, Ray?” Costner: “I’m saying, what’s in it for me?”

at’s a question we often ask ourselves when deciding whether to commit to something. Human beings are naturally transactional. We expect to get something out of our efforts. For me, the something I receive is the enormous satisfaction of knowing I’m doing the best job possible for my clients while doing everything I can to keep my people happy, engaged, and challenged. It’s not about money, glory, or fame. It’s not about me. It’s about all of us pulling together and pooling our mental resources to create incredible outcomes. at’s what makes for a truly wonderful life.

 

ACKNOWLEDGMENTS

is book is the culmination of so many amazing events that have happened to me over the last fty-two years. e continuous love, support and accountability from my parents can’t be overstated, and I am grateful every day for their “practical optimism.” I can’t begin to say enough about my amazing and passionate kids, Cory and Carson, who have inspired me in ways they will never know. ank you to Joel Can eld, my literary partner in crime who brought my voice to life for this book. My sister, my in-laws and my team at TurningPoint have all contributed so much to making me the leader—and the human being—I am today. But most importantly of all, were it not for the love, support, sense of humor, encouragement, honesty and push back from my wife Juliet, none of this would be possible. You supported my decision to leave the rental car company without another job, in order to spend more time with our family; you suggested that I start my own rm back in 2007; and you encouraged me to commit to journaling on a regular basis, which ultimately served as the foundation for this book. You have been there with me every step of the way and I am eternally grateful for your willingness to join me on this entrepreneurial journey.

Last, and certainly least, thank you to the many “Freds” that I have had the displeasure of working for. Had it not been for your lack of leadership, I wouldn’t have any examples of what not to do as a business leader.

  ENDNOTES

1

Just to be clear, I am not going to reveal the real names of the people I’m going to bag on in this book. I am simply going to call them all Fred. Let’s just say that the names have been changed to protect the guilty. Be prepared to meet more than a few Freds!

2

S. J. Haggbloom, “The 100 Most Eminent Psychologists of the 20th Century,” Review of General Psychology 6 (2002): 139–52.

3

Heidi Grant, “Be an Optimist without Being a Fool,” Harvard Business Review, May 2, 2011, https://hbr.org/2011/05/be-an-optimist-without-being-a.

4

The Trevor Project, “Talking about Suicide,” thetrevorproject.org, accessed October 28, 2022, https://www.thetrevorproject.org/resources/category/talking-about-suicide.

5

Gallup, “The Powerful Relationship between Employee Engagement and Team Performance,” 2020, https://www.gallup.com/workplace/321032/employeeengagement-meta-analysis-brief.aspx.

6

Sen Sendjaya and James C. Sarros, “Servant Leadership: Its Origin, Development, and Application in Organizations,” Journal of Leadership & Organizational Studies 9, no. 2 (2002): 57–64.

7

Hubert Joly and Caroline Lambert, The Heart of Business: Leadership Principles for the Next Era of Capitalism (Boston: Harvard Business Review Press, 2021).

8

Again, not their real name. And for those of you keeping track, this is our second Fred. Don’t worry—more to come!

9

Third Fred.

10

Stephen Gandel, “Wells Fargo Exec Who Headed Phony Accounts Unit Collected $125 Million,” Fortune, September 12, 2016, https://fortune.com/2016/09/12/wells-fargo-cfpbcarrie-tolstedt.

11

Melissa Horton, “Are Business Ethics Important for Profitability?” Investopedia.com, published May 27, 2021, https://www.investopedia.com/ask/answers/040715/howimportant-are-business-ethics-running-profitable-business.asp.

12

Mintel, “56% of Americans Stop Buying From Brands They Believe are Unethical,” mintel.com, published November 18, 2015, https://www.mintel.com/press-centre/social-

and-lifestyle/56-of-americans-stop-buying-from-brands-they-believe-are-unethical. 13

Paul J. Zak, “The Neuroscience of Trust,” Harvard Business Review (January–February 2017), https://hbr.org/2017/01/the-neuroscience-of-trust.

14

Francesca Gino, “Let Your Workers Rebel,” Harvard Business Review, October 24, 2016, https://hbr.org/2016/10/let-your-workers-rebel.

15

.!

16

Deloitte, “2019 Transparency Report,” Deloitte.com, September 2019, www2.deloitte.com/content/dam/Deloitte/us/Documents/audit/us-2019-audittransparency-report.pdf.

17

Kim Parker, Rich Morin, Juliana Menasce Horowitz, “Looking to the Future, Public Sees an America in Decline on Many Fronts,” Pewresearch. com, March 21, 2019, https://www.pewsocialtrends.org/2019/03/21/public-sees-an-america-in-decline-onmany-fronts/. AP-NORC, “What Americans Think about the Economy,” apnorc.org, February 2018, http://www.apnorc.org/projects/Pages/MTVAP-NORC-Youth-Political-Pulse,-March2018.aspx.

18

Pete Ross, “If You’re an Introvert, You’re Probably Getting Screwed at Work,” Observer, January 30, 2017, https://observer.com/2017/01/introverts-underrepresentedmanagerial-positions.

19

Arthur C. Brooks, “Why It’s So Lonely at the Top,” The Atlantic, August 27, 2020, https://www.theatlantic.com/family/archive/2020/08/how-make-friends-lonely-bossworkaholic/615709.

20 Thomas J. Saporito, “It’s Time to Acknowledge CEO Loneliness,” Harvard Business Review, February 15, 2012, https://hbr.org/2012/02/its-time-to-acknowledge-ceo-lo. 21

Claude Fernet, Oliver Torres, Stephanie Austin, Josee St-Pierre, “The psychological costs of owning and managing an SME,” Sciencedirect.com, Published March 29, 2016, https://www.sciencedirect.com/science/article/pii/S2213058615300097.

22 Saporito, “It’s Time to Acknowledge CEO loneliness.” 23 Sophia Kunthara, “Industry Specific Professional Networks Get Funding as New Startups Help Remote Workers ‘Find Their Tribe,’” Crunch-base News, May 19, 2022, https://news.crunchbase.com/news/bravado-sales-networking-professional-groups. 24 Vivian Hunt, Dennis Layton, and Sara Prince, “Why Diversity Matters,” McKinsey. com, January 1, 2015, https://www.mckinsey.com/business-functions/organization/our-

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