What Your Key Executive Needs From You, with Craig Barnes.

Speaker 1:

If you’re going to take the risk of running an agency, shouldn’t you get the benefits too. Welcome to Agency Management Institute’s Build a Better Agency podcast presented by HubSpot we’ll show you how to build an agency that can scale and grow with better clients, invested employees, and best of all, more money to the bottom line. Bringing his 25 plus years of experience as both an agency owner and agency consultant to you, please welcome your host, Drew McLellan.

Drew McLellan:

Hey everybody, Drew McLellan here. Another episode of Build a Better Agency. For many of you, one of your goals is that you don’t have to do it all anymore, that you have built a team that you can count on and who is skilled enough that they can step up and do a lot of the things that historically you’ve had to do. And so today’s guest is going to help me dive into that a little bit. So let me tell you about him. So, Craig Barnes, first of all, I got to tell you, Craig Barnes is a great friend of mine. We’ve known each other for gosh, probably 10-15 years. And Craig started in the TV side of the business. About 30 years or so ago, he decided to start an agency. Over the course of the last 30 years, he has owned and run his own agency, which he still does today.

At one point, the agency was over 50 employees, three offices in three different states. So Craig brings decades of agency owner experience to the world. Craig is also on the AMI team. And one of the things that Craig does, and the reason why he’s on the podcast today is, he facilitates what we call the key executive group. So imagine an agency has a right-hand person, a COO, sometimes a director of account service, but really it’s the agency owner’s right-hand man if you will. Those folks come together in a network, so its a peer network, so everyone in the group is a right-hand man or woman. And some of them have minority ownership, but most of them do not.

They come together twice a year and hang out for about two and a half days in the fall and in the spring, share best practices, learn from each other, share resources, and Craig is the guy that brings them together and facilitates that. So he in essence is coaching and facilitating and eavesdropping on these conversations with these folks. So we thought it would be interesting to talk about sort of their perspective on the agency and how they’re trying to help agency owners and what gets in the way of that. So, without any further ado, Craig, welcome to the podcast.

Craig Barnes:

Thanks Drew. Glad to be here.

Drew McLellan:

So, you and I have both been agency owners for a long time and we both have had key employees who make our lives a heck of a lot easier. And as you know, about a year and a half ago, a lot of the agency owners wanted to provide some professional development and some sort of peer to peer mentoring for their key execs, which is why we started these groups. So what surprised you so far about these folks? You know, you’re hanging out with 40 or 50 sort of key execs, what is surprising you about these people?

Craig Barnes:

I just think their total commitment to helping their owners move the agency’s mission forward. Very skilled, very bright, very involved in the business and willing who do what it takes to help move the needle for the agency in the marketplace. And some come to the position having worked at other agencies before, which I think helps bring a little bit of unique perspective for that owner. And some have grown up in the agency and gained the confidence of the owner to the point that they are in that role so they really know the organization inside and out. And I think that, overall, I characterize these people as being very interested in making sure that the owner and the team behind the owner are all sort of on the same page.

And some are interested in ownership and some frankly are not. There’s a mix within the people that we have in our groups. But all of them though, I think have a singular focus of, “How can I help my owner achieve what we’re trying to achieve here?”

Drew McLellan:

Yeah. You know I think one of the things that’s interesting is owners often assume… Agency owners can be, I don’t want to say paranoid, but they can be concerned about sort of opening the kimono too far and either letting the employees see the bad news or how great it is, how much they make, whatever that is. And always assuming that their employees are sort of cut out of the same cloth. And one of the things that I’ve noticed about the key execs is, in traction language, most agency owners are visionaries and most key execs or right-hand people or number ones are integrators. And many of them have no desire to really be in the front role and to run the agency and be the face of the agency. They like being in the background making sure that the machine is actually working.

Craig Barnes:

That’s absolutely right. I mean, I think in the pure traction model and people that listen to the podcast follow that model and know that very well. And you need an integrator. You need somebody to, as you say, pull the levers. And I do think that the people in our groups fit that description almost “to a tee” that that’s what they are interested in doing, with the exception of I’d say there’s a couple people that are certainly interested in ownership and there’s nothing wrong with that. But I think also to elaborate on your point a little bit, as owners, most of us probably did not set out to own an agency.

Drew McLellan:

We’re accidental business owners.

Craig Barnes:

Absolutely.

Drew McLellan:

Most agency owners are. Yep.

Craig Barnes:

Absolutely. So we’ve had to learn along the way how to run an organization and some of us have done better jobs of that than others and we’ve learned by trial and error and we get counseling and advice and coaching and all those kinds of things to grow into our positions. And through that experience, I think oftentimes we find ourselves in a position, and I think you can relate this to your personal life too, whether it’s your wife or your husband or whomever, we all have blind spots.

And we need somebody who can help us make sure that we’re seeing the big picture when sometimes we may be so focused on a particular subject or area of interest that we don’t see the train coming down the tracks the other way. And we need somebody to help us stay on our game. And I certainly think that, as a key exec, and number two, an integrator, that’s what these folks do.

Drew McLellan:

Yeah. It’s interesting. I just did a podcast interview. It hasn’t aired yet, but I just did a podcast interview with Mark Winters, the guy who wrote Rocket Fuel, which is the companion book to Traction, and he was saying that integrators are kind of a rare beast, that for every four visionaries, you’re going to find one integrator. And so for agency owners that have found a great right-hand person, it is in their great interest to make sure that that person stays engaged and connected to the agency because they’re kind of a unicorn. They’re hard to find.

Craig Barnes:

Right, and I think that what I hear most from our key execs is that they want to have a stream of communications that works both ways with their owner, both for contributing, as well as for those times when they need to push back and ask them to consider perhaps another strategy or another direction. And they want that both ways. And they also want to know as much about the operation as possible and for them to be forthright, and as you said, share the good news and the bad news, because that’s the only way they can truly be effective.

Drew McLellan:

Yeah. So in your conversations in the network meetings with the integrators, what are some of the issues that they are wrestling with? What are some of the specific things that they sort of feel like they’re banging their head against a wall about?

Craig Barnes:

I think consistently, and again I think this goes back to us as owners having not set out to do this originally, is the control. We have a hard time letting go. And I think that’s a lot of what the key execs run up against is that the owner will want them to take control and to run with it, but then will stand over their shoulders sometimes and micromanage things. And we all know we’ve seen that across the number of people that we’ve encountered in our agency lives of people that tend to want to hold the reins. And I get it as an owner. I get it. I mean, I was talking to someone about a month ago about this who’s with an agency and they were expressing that frustration.

I said, “Look, you have to at least have the perspective knowing that your owner started this agency. They put their blood, sweat, and tears into it. And it’s a little difficult sometimes to let go of the reins. As much as it’s important for growth of the agency, it’s difficult sometimes.” And I think if you have that perspective, knowing what the owner sort of feels, this odjet, if you will, that they feel, that it can help you understand where they’re coming from and put you in a better position to sort of lead from the rear sometimes, but have that perspective because it is tough. I mean, you’ve been there, I’ve been there, and probably every agency owner that’s listening to us has been there too. It’s like, “Uh,” you get that feeling like, “Oh, I know I want them to do this, but boy, I just feel so nervous sometimes.”

And I think you have to develop a relationship and you have to develop that sense of trust between two people in order to move that forward. But I think that’s the biggest thing that people bump their heads against is just the owner sort of getting in the weeds, getting in the way, and not letting them do what they’ve asked them to do.

Drew McLellan:

Well. I think part of it is, one of the conversations I have with owners, and I know you do too when you’re coaching them, is someone else’s right way may not be your right way, but it doesn’t mean that it’s not going to get you to the end game and that if you want to scale your business, and you know most owners… It’s fascinating to me, on the one hand, every owner talks about the fact that they want to not be involved in the day to day. They are tired of working the 60 hour work weeks. They’re tired of being the only person who can do strategy, fill in the blank, fill in the blank, fill in the blank. And yet they’re the bottleneck stays in the way of that being able to change.

Craig Barnes:

Yep.

Drew McLellan:

It is akin to inviting a nanny in to raise your kids during the day while you are at work. It’s often hard to watch someone else discipline your kid, or get a hug from your kid, or whatever, go to the school play with you, whatever that is. But the reality is, if you don’t do that, then you have to stay anchored home and you can’t go out and do what you need to do. So you’ve got to set the nanny up to be successful and I think that comes down to, and I’m curious your thoughts, but I think that comes down to having really clear expectations about who gets to decide what when, and having almost like a safe word where you can say orangutan and that says, “You what, you’re violating our agreement.” Whatever that is, whatever the communication mechanism is that says, “Look, you told me that I could make this decision and that as long as these criteria were checked, that you were going to let me run with this and now you’re not. Now you’re pulling the rug out from under me.”

Craig Barnes:

Right. And I will tell you that a real simple way to address that and a full attribution to one of the members of our key exec group has this in place with her owner, and it’s an empowerment agreement and it’s a one-page document. And you know, we all set goals. We sit down with our staffs or with our number one and we create a set of goals for the year. But really the empowerment agreement can be a simple one-page document that basically has four points to it. And it’s about decision-making boundaries. And point one is, please go forward and run with these. And you decide which of these things do you want your number two to run with. Two, please inform me after you take certain actions and do certain things. Three, please consult with me on X, Y, Z. And then four, please request my permission about, again, whatever list is.

And it’s very simple, right? And I think if you have that in place, then there’s something for reference to your point earlier that you can go back to and say, “See, this is what you asked me to do. This is what you agreed to.” And I think it creates a framework to help accelerate the process to a point that you begin to see those results you’re looking for and as you say, not work the 60-hour work week, or allows you as an owner to focus your time to work on that business as opposed to being in the business too much and getting in the way of progress.

Drew McLellan:

Yeah. That is a great model and tool.

Craig Barnes:

It really is.

Drew McLellan:

And I think it’s created in a moment of calm and in a moment where you’re not feeling pressured to make a decision so everyone is sort of bringing their most rational self to the discussion as opposed to their emotionally stirred up or… I think at the end of the day, one of the ways I explain this to employees, which is I think right in alignment with what you do is every owner has made a bad decision that put them in a position, whether it was I didn’t chase after new business aggressively enough, whatever it is, they’ve made a bad decision that put them in the position where they have to let someone go because they just don’t have enough money in the coffers to keep somebody on payroll.

And so I think at the end of the day, the fear for the owner of letting somebody else raise the baby is the impact that it has on the family. And so the motivation is great, it’s just sort of misguided.

Craig Barnes:

Absolutely. Absolutely. And I think too that owners, as you say, they have had those experiences so it shapes some things that they do down the road, but in talking with our key execs in these groups, they all I think sort of get that to some degree and they’ve seen those things happen and they really take their role seriously from how they can help motivate the team. One of the analogies I like to use is that… I’m a big hockey fan. Our son grew up playing hockey. He played hockey all through college. And one of the things that you’ll see in a hockey team is a very specific role for the position of captain. And it’s not a ceremonial position by any means.

And what a captain on a hockey team does is that they are the conduit between the coach and the players. So the coach may have some specific things that they want to get done, and the captain can help translate that to the players in a way that makes sense and for the players to relate to what the other player is saying. And oftentimes too, employees may not feel that they can always approach the owner, but they can always approach the number two or the captain of the team to bring concerns to them or ideas that they want to move forward.

And I think that in your point about having made these bad decisions and fear and stuff, I think that in this role, these key execs can help these owners move past that in a way where they’re setting up this communication stream with the team that gets everybody on the same page and I think helps take away some of that fear because they can see the results of what’s happening as the team progresses and things move through the pipe.

Drew McLellan:

Yeah. As always, in every relationship, it all boils down to communication. And one of the things, when I look at agencies who have a successful sort of owner and key exec relationship, versus the ones that are struggling, a lot of it is about communication. And so it about the clear boundaries, so the tool you talked about, the empowerment agreement, is really a brilliant tool. But it also is about regular communication. So one of the things that I know works best in an agency with a key exec or somebody who’s a right-hand person is that there is a standing meeting that both of them will bust a hump to honor.

So again, if I’m traveling, we talk on the phone or by Skype or Zoom or whatever. If we’re in person, we’re either in the office or we’re on a golf course or we’re at a bar. I don’t care where it is, but that the key exec comes with an agenda of things to talk about and the owner also probably has his or her own agenda, but that’s the key exec’s meeting to update the owner on where they’re at with goals and what’s going on and decisions that are coming up.

And it’s the time that the key exec truly has the owner’s full attention, because, as you and I know, with owners, A – we’re a little scattered and oh, squirrel, anyway, that’s just our nature. But B – owners are burdened with so much. The to-do list is so awful and so big that even if somebody walks into your door and says, “Hey, do you have five minutes?” You’re looking at them. You’re sort of listening to them, but you’re also either mentally answering an email, or you may even be looking at one of your screens, so they don’t really have your full attention.

Craig Barnes:

Yeah. And I think the key there is what you touched on just a minute ago, and it’s bust hump to keep the meeting.

Drew McLellan:

Yeah.

Craig Barnes:

And that’s the one thing that key execs will tell you is they’re looking for that consistency from their owner and that kind of commitment because you’re right, and we teach this in the workshops too that to have these once a week meetings, or however you set them, once a week, two weeks, or whatever it is, where you come to the table with a very clear agenda about what you want to discuss and that time is sacred.

Drew McLellan:

Yeah.

Craig Barnes:

And you have full attention so that you can address whatever needs to be addressed. And the whole point about consistency is key. And as an owner, I get that. I mean, sometimes, as you say, we’re thinking about many different things, whether we’re looking at cashflow or whatever it is that’s occupying at the moment, you got to be able to clear your head and spend that time with your key exec in order to make sure that the agenda and what is on there is being addressed in a way that helps move the agency forward.

Drew McLellan:

Well, not only is it the tangible getting through the agenda and making decisions, but it is, at the end of the day, this relationship only works if there’s a great mutual respect and trust. And I think having that regular meeting on the calendar and honoring it, even though you’re both crazy busy and you have a million things to do. A, what that does is says, “Look, I can count on you. I can rely on you.”

But it’s about the respect for the other person’s position and through time, by walking through those agendas and making those decisions together, and if the key exec is smart, over communicating what’s happening on the day-to-day to ease the owner’s worries, especially on the front end of the relationship, pays off huge dividends in terms of building up the trust that allows the nanny to take the kids to the playground without mom or dad, and then to take the kids to the zoo and maybe to actually take the kid in the car. It just builds up that trust in a way that I think is pretty hard to do any other way.

Craig Barnes:

Yeah. The one thing that I’ll talk to key execs about is, I know this from my own experience of having a key person work for me, is that I always talk to them about you just can’t bring issues to the table without some proposed solution. And I think often that’s a great way to build trust. If you are a number two and you want to develop that relationship solid with your owner, you have to come to the table with a proposed set of solutions.

It may not be the solution that the owner chooses, but at least it shows you’ve looked at the problem, you’ve thought about the problem, and you’ve addressed it in a way that you think is a way to solve that issue and that you’ve spent the time and you’re deep into it so that at least they have something to consider as opposed to just throwing it out on the table and saying, “Well, what are we going to do?” And this approach, I believe, is a great way to build trust because I’m coming to the table and I’m bringing a solution with me.

Drew McLellan:

And by the way, those key execs should be modeling that with whoever they’re supervising and making sure that they’re doing that when they walk into their office. I mean, that should be an expectation for agency employee behavior at every level. We even teach that at the boot camps. “Look, I don’t care if you’re account coordinator. If you’ve identified a problem, awesome come tell us right away, but come tell us in the context of I’ve given this some thought and I’m wondering if one of these three options might be a good solution, whatever that is.” And depending on your role and your experience level, that’s how you learn how to solve problems and that’s how you move up the ranks because nobody wants someone to just hand them a problem.

Craig Barnes:

Right. Right. Just don’t throw it at my feet and walk away. It’s better to come to the table with some ideas about how we can and solve it. That’s key.

Drew McLellan:

And as the owner, I think you also have to be receptive to the fact that every solution brought to you may not be the way you would solve it, but again, recognizing your own blind spots, that doesn’t mean that one of those isn’t the best solution.

Craig Barnes:

Right, right. And I think that goes back to being flexible and understanding that there are multiple ways to look at something and address things and to be willing to look at it from all angles and to consider that, so that, again, it just doesn’t all fall on your shoulders as an owner to fix everything yourself.

Drew McLellan:

Right.

Craig Barnes:

Why have a number two if that’s what you’re going to do?

Drew McLellan:

Right. Right. I want to dig into sort of what makes an owner ready because I honestly believe not every owner is ready to have a key exec and some owners just aren’t ready to hand over the reins and let somebody else help them raise the baby. So I want to dig into that, but first let’s take a quick break.

I get that sometimes you just can’t get on a plane and spend a couple days in a live workshop and so, hopefully our online courses are a solution to that. Lots of video, hours and hours of video, a very dense detailed participant’s guide and all kinds of help along the way to make sure that you get the learning that you need and apply it immediately to your agency. Right now we’ve got two courses that are available. We have the Agency New Business Blueprint and we have the AE Bootcamp. So feel free to check those out at agencymanagementinstitute.com\ondemandcourses. Okay, let’s get back to the show.

All right, I am back with Craig Barnes from AMI. Craig runs our key exec groups and hangs out with a lot of your top employees, employees who have often been with the agency for a long time. You may be grooming them for ownership, they may be a minority owner already, but they already play a pivotal role in your shop. So one of the things, Craig, that you and I both see in agency owners is sort of a varying degree of business maturity in terms of the willingness to acknowledge that their idea isn’t always the right idea, to mentor and guide without choking/keep employees, and the ability to share responsive ability across the organization so that they don’t have to make all the decisions and everything’s not resting on their shoulders.

When you look at the key execs, what are some of the traits that the “good owners”, the owners who are ready to have a key exec, what are some of the traits they exhibit that listeners need to sort of look in the mirror and see if they match that profile?

Craig Barnes:

I think the thing that I see among those in our groups that have a system that’s working really well is that the owner is first and foremost interested in growing the agency, but realizing they can’t do everything themselves. So they’re openly committed to wanting help, recognizing they can use the assistance so that they can focus on what they want to focus on and truly empower that number two to do the tasks that they’re asking them to do. One in particular I can think of, she does an excellent job of running… She’s responsible for running the day-to-day operations of the agency. So in essence, she’s probably operating as a COO, right?

Drew McLellan:

Yep.

Craig Barnes:

And she’s been empowered to do that and that owner wasn’t always ready for that, but has evolved into that because he can see what it takes in order for them to achieve what it is he wants to achieve as an owner in growing that agency and truly has put her in a position to be the COO to make sure that the day-to-day operation is moving along and the problems are being addressed and that, at the end of the day, goals are being met and that he can go and do what he needs to do to grow the agency and most often that is spending the time and the willingness to go out and sell the agency.

We’ve talked about this a million times that no one sells the agency like the owner sells the agency. And if you’re truly going to put yourself in a position to do that, you have to have somebody who’s at the house watching over things, making sure that’s not burning down.

Drew McLellan:

Absolutely.

Craig Barnes:

And I think that’s key. And I would say to the owners out there who are considering this, I mean, you got to the hard look in the mirror and say, “Am I willing to either put my trust in somebody that I rely on already or I think I can tap into this in a way and give them my full support?” And if you can’t, you may not be ready. But I think if you want to grow, you have to be willing to put a system in place with strong processes to support it that allows somebody else to take those day-to-day tasks and carry them out in a way that matches the goals and the objectives of the organization so that you can go focus on the things you want to do.

And maybe you just want to play golf once a week. You should be able to do that, whatever it is that is important to you, but you have to be committed to really letting somebody do what it is you’re asking them to do. And if not, it doesn’t work. I see it all the time. I talk to owners as part of the coaching that we do who get frustrated because they say, “I don’t know if this person really gets it.” And I always challenge them about, “Well, let’s talk about what are you doing to help give them the freedom they need to do what they need to do. What’s holding you back from that?”

And again, its control. It’s control. So you have to look in a mirror and say, “Can I relinquish some control? Am I confident releasing this control so that I can let this person manage what needs to be managed and I can do what I need to do?” And I think that’s the key. It’s looking inward and being honest with yourself. And if you know that you can’t do it right now, that’s okay, but if you want to grow, I think you have to set forth a plan and you have to figure out how you can get there and, as I said, put processes in place to support that so that it gives you the confidence that at point in time you can do that. You can let go a little bit at a time.

Drew McLellan:

Yeah. You know, I always think of it as it’s sort of like when you’re teaching your kid how to ride the bike. So they’re never going to learn how to ride the bike if you don’t let go of the back of the seat. And so you can run alongside them for a while and you can hold on, and honestly, at a certain point in time, the one who is more afraid of letting go is you the parent, not the kid. They’re ready to go. And it’s us typically who is holding them back.

And so one of the conversations I have with owners sometimes is, “Here’s the deal, if you don’t let someone else the business and you don’t let someone else help you take the controls and move the agency where you want it to go, you’re never going to be a sellable agency because no one wants to buy an agency that is dependent on the owner who, by the way, when they sell the agency wants to leave. And you can only to the capacity that you have as a human being to not sleep, because at a certain point in time, there’s just too much to be done and you cannot do all the strategy, mentor all the employees, do the new business, oversee the finance, fill in the blank. In many cases, service some clients. You are the one who is in the way of growth, so you’ve got to decide, am I content creating a job for myself that just keeps me super uber busy or do I really actually want to create a business that creates revenue whether I’m at the table or not?”

Craig Barnes:

Right. Right. And I think you also have to be honest with yourself about do you have the right person in place. Do you have the right person in place to help you do this? And you alluded to it earlier, I mean, we are sometimes quick to hire, slow to fire. And you have to be willing to have an honest assessment to say is this the right person. Do I really truly have the right person to help me? And if not, you’ve got to find that person because oftentimes you’ll think, “Okay, well this person’s been here long, et cetera, et cetera and it seems like a logical move for them.”

Drew McLellan:

I’ve promoted them four times simply because they’ve been here for a while. It’s like a bank, if you’ve been there five years, you’re a Vice President.

Craig Barnes:

Exactly. Exactly. And they may not be the right person for the job. Just simply may not be the right person for the job. And you have to be able to figure that out and whether you do that through your own skills or use an assessment, like with our friend Art Belay or someone like that, who can help you identify whether they have the kind of tools that you’re looking for, you need to make sure that the right person is in place.

Drew McLellan:

Yeah, absolutely. So when you look across the spectrum of the key execs that you have in the groups, what are some common traits that you recognize because you see them bubbling up and serving them well, but also from your own experience of having good ones and bad ones? What are some things owners need to look for if they’re looking out over the landscape of their employees or they’re looking to hire someone to help them run the agency day to day, what are some of the skills and characteristics and personality traits that you think make a great key exec?

Craig Barnes:

I think one, they have to demonstrate that they’re good communicators and it’s how they work with the other people within the agency and watching them, how they interact with them, and how the other people respond to them. I think that’s key. Secondly, I think you need to look for someone that has a large view of what the business is about and not just the agency business, but really what is the business of business. That’s the business we are all in, we should be in, is solving business problems and not selling stuff. And do you have somebody who really recognizes that the agency really needs to be in the business of business and do they have a global view? So I see that in a lot of our execs that really understand that and understand that’s what the agency should be focusing on.

I think you should also look for people that have a personality such that they attract people. You know, they attract people in a way where people respond to them positively and that they’re motivated by them and they understand what it takes to move a team forward. And I think also these are people that I see as being highly organized. They present really great exceptional organizational skills and they’re willing to roll their sleeves up to get done what needs to be done and it’s not just about them. They really have a sense of team and I think that’s critical.

Drew McLellan:

Well, and I think the detail part gets super important when you think about most owners, that’s not really their gift. And so having somebody who is really making sure that all the “I’s get dotted and the T’s get crossed” as the agency gets bigger and the owner can’t possibly know what everybody is doing all of the time becomes vital to being able to continue to grow your agency while not tripping over yourselves and making mistakes and losing clients. And losing employees, right?

Craig Barnes:

Absolutely. And I think that the traits of these people, they need to really understand what makes the agency engine go in terms of holding people accountable. I mean, we all talk about how much time we write off during the course of the year. Well, this number one person, or number two person, however you want to refer to them, should really be on top of that game to make sure that the way that work moves through the agency is doing so in a way that you’re going to get the kind of yield that you want so your effective hourly rate doesn’t go into tank. They have to be committed to helping make sure and shepherd that process through. They have to have an understanding from the metrics of the organization really what does that mean.

And as an owner, you have to be willing, and we talked about this really early on in our time today, but you have to be willing to open the kimono and help them understand this is how we run. This is how we run. And I think one of the things with our group, the consistency that I think helps with we have owners at AMI, owner networks, and then we have their key execs in this network, and they’re all operating under the same 55/25/20 principle.

Drew McLellan:

Yep, and looking at the financials the same way and all that, yep.

Craig Barnes:

Exactly. So there’s consistency there, so they understand that and they can help make sure that the financial performance of the agency is such that they’ve got their finger on the pulse to control what can be controlled in an appropriate way so that at the end of the day that yield is there.

Drew McLellan:

Just for clarification, I always call them number ones, because, and this is self-revealing, but because on Star Trek, The Next Generation, Picard always called Riker number one, so in my mind they’re number ones. That’s a technical agency rule that I think we all just need to abide by because it’s a Star Trek way. One of the things I think about when I think about the key execs or the number ones who are really outstanding, they behave, whether they do or not, they behave like they own the joint.

Craig Barnes:

Yes.

Drew McLellan:

And so whether it’s having to cut staff, or it’s managing the budget, or it’s hearing bad news from a client, they respond in exactly the same way. If you hook them up to some sort of a machine that monitored their brain and their heart and you hooked up their owner to the exact same machine, I think their reactions would be absolutely identical.

Craig Barnes:

Yep. And I will tell you too, that I think that the number ones are real good about spotting when there’s a problem employee on the team that may either need to be counseled or exit the agency. And they often see this either well before the owner sees it, and are much more willing to cut the cord for the betterment of the agency than the owner is.

Drew McLellan:

Yeah. I have a theory about agency owners. I think for most of us, and this is certainly was true of me, for most of us, when we were an agency employee long before we got the crazy idea to start our own, or we were an employee wherever we were, our social circle was built through our work friends like everybody’s is. And when you become the owner, there’s that weird dotted line between you and everybody else and I think you been the rest of your career hoping that everybody likes you and hoping that you’re popular and that you’re a good boss, which quite honestly is great and it makes agencies great places to work, but it also is a huge blind spot for agency owners and they have such a hard time letting someone go or disciplining someone because of that. And I think the key exec has a different perspective on it. They’re down in the trenches with that person and they can see very quickly if somebody is not carrying their load.

Craig Barnes:

And I think they also have very clear vision and an understanding of, by keeping that person on the team-

Drew McLellan:

What it costs.

Craig Barnes:

What it does to the rest of the team.

Drew McLellan:

Yeah, absolutely.

Craig Barnes:

And how and how they view the decision making within the agency. Because if the owner continues to hang onto someone who the number one knows needs to go, then everybody else in the agency takes that cue. And I think that’s extremely important. And you and I both have seen so many cases where owners are so hesitant to reach that critical decision and thinking about it for them most often is far more fearful than actually doing it once they do it. But the results generally, after they’ve made that decision, can really catapult the agency to another level. And I think the number ones are very keen and very aware and see these issues well before owners do and that to me is a tremendous asset that they bring to the table.

Drew McLellan:

Yeah. Well, I always think of when you let a bad employee stay for too long, the cost is not only what that person doesn’t do, but it’s the sliding of productivity from your good employees because their attitude is pretty much, “Well, if that person can get away with that, why am I busting a hump at night or on the weekend or whatever? Screw it. I’ll behave like they behave.” And I think the key exec is in a position to see that dynamic and go, “Uh oh, not only is this person slowing down the boat, but the entire boat’s going to freeze in a minute because everybody’s going to slow down.”

Craig Barnes:

Right. Absolutely. Without a doubt. Without a doubt. And it’ll thwart the agency’s ability to grow. There’s no doubt about it.

Drew McLellan:

Yeah.

Craig Barnes:

Without a doubt, without a doubt.

Drew McLellan:

So in some of your meetings, have you talked about, or in some of your individual conversations with some of the number ones, have you talked about how these people want to be recognized and compensated? Because when you’ve got a good one, they’re kind of a unicorn and you probably want to keep your unicorn because they’re hard to find, so how can owners appreciate their number ones and what can they do both inside of work and through compensation and other things, what can they do to make sure that that person wants to stay and feels really valued?

Craig Barnes:

I think that from a compensation standpoint, I think that they want to be treated fairly and they want to find ways to enjoy some of the perks that agency owners can also enjoy themselves. So the kinds of things that an owner can do to help that person, sort of a pat on the back if you will certainly goes a long way, but I think in addition to that, if owners are willing to, whether it’s to send them on a trip, using some of your frequent flyer miles or some of your Amex points or stuff like that, I think those kinds of things along the way to help them feel a little extra special is a great way to do it.

I think they also want some acknowledgement that what they are doing, even though some of the things that they’re doing really are behind the scenes, may not be as is visible to everybody else in the agency about the role that they have, I mean the impact that they’re having, I think the owner helping make everyone else aware that the owner sees what this person is doing and recognizes that across the agency so that the rest of the agency understands that as well. Because a lot of times it’s the minutia, its the small detail things that these number ones are doing that the rest of the team may not necessarily be aware of, but has a huge impact on the agency. And I think owners making everyone else aware of that is extremely important.

Drew McLellan:

Yeah. I even see, like for example, if you’re sending them to a conference, because I think one of the other things they value is continuing to grow and get smarter and better. You know, to say to them, “Hey, that workshop is a Tuesday, Wednesday. Why don’t you fly your family out or whatever and stay Thursday, Friday, Saturday, Sunday in fill in the blank cool city?” I think a lot of those sort of niceties go a long way, but I also think just acknowledging, like looking them in the eye and saying, “You are making a huge difference. Thank you for this. I know that sometimes I’m your biggest obstacle and I hope I’m getting better, but I want you to know that even on the days we disagree that I appreciate you and I value what you bring.” As owners, we’re not good at slowing down and having those conversations very often.

Craig Barnes:

Right. Right. And while this may seem a little self serving for our groups, but I will tell you that to a T in the groups, every person that’s in our groups, they have found this experience to be absolutely a great recognition from their owner of their importance to the agency. The fact that they’re sending them away for these two and a half days twice a year to meet with other number ones who share similar issues and challenges in triumphs, and to create a network for themselves of support among like peers to help them be better at their jobs. And I think they all are extremely excited and appreciative that their owner is paying the tab for them to be able to do this. And I think it’s this witness too that you and I know this from the first group that we started, the intent was that we were going to meet once a year. And they all said, “Well, that’s not enough.”

Drew McLellan:

Right. We’re hungrier than that.

Craig Barnes:

We’re hungrier than that. And the owners responded because they went back and they had a logical reason. I told them, I said, “If you’re going to ask your owner for this, you come up with a set of rationale about why this would be important.”

Drew McLellan:

Yeah. What’s the value?

Craig Barnes:

What’s the value to the agency? And to a T, the owners responded. But I can tell you that’s huge for them that they have this opportunity to create their own support system, if you will, of like peers, the same way that owners enjoy in their owner networks, same thing.

Drew McLellan:

Well, you think about it, you and I were both in an owner network for a long time so we know that running an agency, a lot of times you sort of feel like you’re hanging out there all by yourself. And there’s great comfort in having a peer group that gets your world and that is supportive and has resources that can help you. And so I’m sure for the number ones, it’s the exact same thing that they’re in a weird position because they are an employee, but they have knowledge and the confidence of the owner that the other employees don’t have. And they know a lot of stuff they can’t really talk to anybody about but the owner. And so to have a group of people where they can talk about the challenges that they face in a safe and confidential environment I’m sure is really probably a great relief, and in some ways probably elongates their longevity because they don’t feel quite so alone.

Craig Barnes:

Right. And I think it demonstrates there’s a commitment to this person and I trust you and I’m sending you off to do this. And they have that they have that opportunity and it says to them that they have a solid position within the agency and the owner appreciates what they’re doing.

Drew McLellan:

Well, and I think the other thing too, which we haven’t talked about, but seems kind of obvious is if you’re an owner you need to structure some sort of bonus program tied to goals that rewards all of your employees, but probably there’s a special side pot of money for your key exec so that they financially benefit when the agency benefits. So again, I always argue if you get to keep 75% of it, what’s the big deal in giving away 25% of it. It’s better than paying tax on it.

And in today’s environment, the other thing you have to recognize is this is a highly skilled human being that anybody would kill to have on their staff and so if you are not a good owner and you are not giving them the opportunity to really do their job well, and you are pulling the rug out from under them with decisions or sort of working around them… I’ve got some owners that set their key execs up for failure because they give them authority and they give them responsibility but then when they do something the owner doesn’t like, he or she does and end run around and undoes it. And you know what, that person’s not going to stay very long.

Craig Barnes:

No, not at all, not at all. And that will erode quickly into situation that’s not good for anybody.

Drew McLellan:

Yep. Well, you know what we could chat about this forever and I would definitely have you back on the podcast because this is a topic that needs to be dissected even more, but kind of as we close, talk a little bit about, and I know that you’ve only been working with these guys for about a year, but talk bit about what you’ve seen in terms of agency performance when you’ve got a number one in the role.

Craig Barnes:

What I’ve seen so far is that in each of our meetings, before they leave the meeting, they make a commitment of action to take between now and the next meeting, a very defined goal that’s a smart goal that can be measured and has a timeline to it. And they come back to the next meeting reporting the impact it’s had on the agency, whether it’s been a financial improvement or they’ve created a client dashboard, whatever it is, they’re using the opportunity to create very specific sets of action that produces positive results for the agency. And I think that is the key. It helps them become focused on what they can do. Pick the biggest rock, if you will, that they can identify and move that rock to conclusion before the next meeting and report on those results. And we’ve seen some fantastic news and results coming out of those efforts.

Drew McLellan:

Yeah. Again, the lesson here owners is whether your key exec or your number one is in a group like ours or another group, or they attend some sort of executive thing, one of the things you need to ask them to do is not only be working on the agency goals, but that they should have some very specific goals of their own and that you need to be coaching and mentoring them on how to get that done, which by the way is not always our, as agency owners, strong suit. You know, we tend to be up in the clouds a little more and the key execs are the ones who are grinding it out day to day. So again, a vital position for you if you’re ready to have one.

Craig Barnes:

Absolutely. Without a doubt. Without a doubt.

Drew McLellan:

Craig, this has been awesome. Thanks for carving out the time today to chat with us.

Craig Barnes:

Thanks Drew.

Drew McLellan:

Hey everybody, this wraps up another episode of Build a Better Agency. Hopefully you found it valuable. Couple things, one, really, really grateful if you will go to iTunes and leave ratings and reviews. You have no idea what that does to promote the podcast and also to make sure that we get on more folks’ radar screens. If you’re looking for me, you can find me at [email protected]. We’ve got all kinds of amazing workshops for owners and AEs coming up in the next few months, so make sure you check that out at agencymanagementinstitute.com and I will be back next week with another great guest to help you build an agency that serves you and your family and your employees and your clients well. I’ll talk to you soon.

Speaker 1:

That’s all for this episode of AMI’s Build a Better Agency brought to you by HubSpot. Be sure to visit agencymanagementinstitute.com to learn more about our workshops, online courses, and other ways we serve small to mid-size agencies. Don’t miss an episode as we help you build the agency you’ve always dreamed of owning.