Building a growth mindset is best done in community with Pam Slim

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, please welcome your host, Drew McLellan.

Drew McLellan:

Hey, everybody. Drew McLellan here with another episode of Build A Better Agency. This is an episode that I have to confess, I’ve been looking forward to recording for a really long time. I’m going to introduce you to someone who I have followed for a long time, read all of her books. I think most of you are going to be very familiar with her work, and she’s doing some very interesting new things that are really going to speak to some of the challenges that you’re having in your business. Without any further ado, let me tell you a little bit about her, and then we’re going to jump right to the conversation. Pam Slim is an award winning author, speaker and small business coach. Most of you probably know her from her book, Escape From Cubicle Nation, but let me tell you a little bit about what she was doing before that. She spent the first 10 years of her solo practice as a consultant at large corporations like HP, Charles Schwab and Cisco, and she worked with thousands of employees, managers, and executives.

And then came Escape From Cubicle Nation, the blog, which led to the book, which won, by the way, the Best Small Business Entrepreneur book of 2009. Her latest book, Body of Work was released with Penguin Portfolio in ’14. Now, Pam has opened up what she calls a business learning library, called … It’s K’é. Pronounce it for me, Pam.

Pamela Slim:

It’s called K’é, which is a Navajo word. Now, all your listeners know one word in Navajo-

Drew McLellan:

That’s great. And in Navajo, it means what?

Pamela Slim:

It means a system of kinship, connection, family. My husband is Navajo, and I love to watch when he meets relatives from his tribe. They introduce themselves by clan, and as soon as they’ve figured out the specific way in which they’re related, so sometimes you might be somebody’s grandfather by clan or auntie, it’s that look and that feeling that they have, it’s that K’é, that emotional moment in which you know that you are related. My husband and I, that’s the way we like to feel in general in our community, and certainly within our learning laboratory here in downtown Mesa.

Drew McLellan:

Here’s why I love that, that’s what AMI is based on, right? It’s these communities of agency owners that commit to being as excited and supportive about someone else’s success as their own. They come together in really these little clans, which are these peer networks, and so they always talk about that those groups are their brothers and sisters, and then all the other clans or peer networks are their cousins. And they not only help their own brothers and sisters, but they reach out and connect with and help their cousins. So, it’s exactly the same mindset in my world as it is in yours.

Pamela Slim:

I love that. I feel like it goes to one of just the core dimensions of what it is that we hunger for as humans, which is what Brene Brown talks about a lot, which is belonging, which is connection. And to me, it’s at the essence, it’s not something you add as a last ingredient when you’re creating a business, it’s always the first, it’s always the first.

Drew McLellan:

It’s the core.

Pamela Slim:

It’s the core of everything, your client relationship, your employee relationship, all of it, even as you grow the relationship with your board and senior team and all of that.

Drew McLellan:

Amen. Well, officially, welcome to the podcast. I’m thrilled to have you here.

Pamela Slim:

I’m super excited to be here.

Drew McLellan:

I want to jump right in. I know that Susan Baier, who many of my listeners are very familiar with, who is my research partner in all of the AMI research and has been on the podcast a couple of times, and Chris Lee, and you have embarked upon a new research project. Tell us a little bit about what the project is, and why you decided it was important enough to invest to find the answers.

Pamela Slim:

Yes. Well, I have been in business for 21 years, believe it or not, and I, in the last 12 years especially, have been super interested and excited, and the core of everything I’ve done in my work is really an understanding what actually makes somebody able to on one hand, successfully quit their job to start a business, AKA escape from cubicle nation. What is that true journey? What I found in that book and all the years that I wrote that blog was that, yes, it was part understanding the steps in order to start a business, it was understanding all the legal requirements, it was understanding business models, and there was a huge emotional component to that, that had to do with identity shifting, telling your uncle at Thanksgiving that you’re actually giving up your big, high paying job at IBM in order to start your own business, which would get you an immediate lecture and banishment to the children’s table.

Drew McLellan:

When I started my agency, my mom would bring coolers of food, and she would always have some excuse, like “Oh, the ham was on sale and blah, blah, blah, blah.” It took me a while to realize that she was bringing food, because at that time I had an infant, I was raising my daughter, because she thought I wasn’t feeding her. She assumed that I had lost my job, I was starting this crazy new business, and clearly, my child was going to die from starvation. So you’re exactly right.

Pamela Slim:

And you know what, I’m probably more like your mom than you because I’ve seen the back side of what it’s like to run a business. It’s one of the great blessings and sacred experiences of really being behind the scenes, not the fancy glistening thing that we put on Facebook, or the brave face that we put on in our high school reunion where we tell people what’s going on, the behind the scenes is a big emotional journey.

Drew McLellan:

Yeah. It can be so grueling.

Pamela Slim:

Oh, my gosh. And it can be as invigorating and joyful. Don’t get me wrong. It’s all of it. But one of the things in working with Susan, and we’ve really, specifically the last three years, Chris and Susan and I have become mastermind partners, just business owners that get together and focus on solving each other’s problems, and in really deeply diving into understanding Susan’s perspective, it became so clear to me as a business coach that having this very specific way that we could understand, not just the problems and challenges faced by business owners, because honestly, there are some core ones that everybody’s going to recognize, get me some more customers, oh my God, I have too many customers, I have no idea how much money I’m making.

Drew McLellan:

Cash flow. I can’t find the right employees, I have too many employees. Everyone else does what I do, and they sell it for half the price. Right? You’re right.

Pamela Slim:

It’s certain things, like it’s what everybody is going to say, because that is being in business. What it is that we became fascinated by, and to me as a business coach and as somebody really who has the mission to be helping to build the leadership capacity of small business owners and entrepreneurs. That’s what drives me. I see it as it can be in one-on-one situations with clients, I can see it as this emerging island of misfit toys collection of people around the country and the world, which by the way, makes up about 53% of the US gross domestic product, non-farm GDP, our small businesses. Crazy. 99.7% of new jobs are created in the small business sector. That comes from the Small Business Administration Research in 2015. So, we’re not talking about just a couple of people that are doing some new things, we’re talking about the majority of our economy.

Drew McLellan:

Yeah. The backbone of our economy.

Pamela Slim:

Right. And that’s where all directions are pointing, is that more and more people are going to be independent. So to me, I think of, okay, what is going to help us in tumultuous times in which we are right in the middle of, doesn’t look like that’s going to change, and that is deeply understanding really what are those keys that are going to help us unlock the solving of the problems, the great problems that we know have been there. So, what we decided to do with this research is to dive into what are people’s attitudes toward obstacles. So, when faced by an inevitable challenge, what actually is your attitude toward that obstacle? And clearly, as you probably understand where we’re going with this, depending upon what your attitude is, that absolutely is going to drive whether or not you’re able to overcome it. And so, that was really the attitudinal side that never before had been done in an academically valid study, so we actually partnered with over 100 organizations, we were co-sponsored by … they were formerly known as The Small Business Web, now they’ve just rebranded to The Cloud Software Association.

So, it’s Dropbox and Google and FreshBooks, and pretty much every app that you use in order to run your small business, because that’s the world they live in too. All their customers are trying to face these challenges, and so we got over 2,000 responses. We embedded all kinds of cool research in there to actually look at ecosystems, and that’s actually the topic of my next book, is I think people gather in natural ecosystems that are surrounded by products they use, and influencers they follow, and associations they belong to, and events they go to. So, we actually put a lot of questions in the survey that also will allow us to actually see what some of these ecosystems are, and what’s this interplay between, if there is one, between stages of business and products they use and people they follow. So, it should be really juicy.

Drew McLellan:

Now, you guys are in the midst of this research now, right? So, you’re out of the field, you’ve already done the data gathering, you have not gotten the final data yet, right?

Pamela Slim:

We are weeks away. Probably in a couple of weeks, we’re going to do our first webinar sharing the results with all the survey partners. So, we’ll show that to them first so they can see it, and then we’re going to be rolling that out with a lot of information. Of course, we’re going to share it with you and with everybody, because we really have designed it. We totally funded this ourselves, we really wanted it to be something that was extremely useful for both business owners, themselves, as well as people who support business owners, because we want to make things better. And then it definitely leads into the next stage of what it is that I’m doing here in business.

Drew McLellan:

Yeah. Listeners, by the time you hear this, the research will be out. We will make sure that there is a link in the show notes for you to get to the research, and I will make sure that we have Pam and Susan back together to talk us through some of the data. I will also have either a link or a note to you about when I think that episode is going to air so you can get the full story. But let’s back up, have you seen enough of the research that you can tease us a little bit with some of the things that you have seen that is particularly interesting or insightful as you think about what you know about agency folks and their world?

Pamela Slim:

Yeah. We haven’t begun to name the segments yet, but something really out to me, I don’t know if you have ever read the book Mindset by Carol Dweck, have you read that book?

Drew McLellan:

Yeah. Yeah. It’s a great one.

Pamela Slim:

Yeah. Anybody who’s a parent, it’s like mandatory reading, because it’s great for being a parent as well.

Drew McLellan:

Yes. Yes.

Pamela Slim:

But she really talks about a fixed versus growth mindset, and one of the things that really struck me as we started to look into the attitudinal segments is that there is one attitudinal segment that exhibits the really typical characteristics of a growth mindset. When faced with an obstacle or challenge, these people expect challenges, they know it’s part of doing business, so it’s not something … they tend to really have a positive mindset of saying, you know what, if there’s a problem, I know that I can try to figure it out, that problems are figure out-able. I have an attitude toward overcoming that obstacle that makes me optimistic to think that I probably can overcome it. There’s another segment, not surprisingly, that’s really contrasting that, which basically is saying you got it or you don’t.

Drew McLellan:

Yeah. Interesting.

Pamela Slim:

Which, when you think of how that actually plays out in the world that I live in, which is in the emotions and the mind of entrepreneurs, that’s pretty brutal. Let’s say you’re early on in your practice and you do a pitch to a really large client, you don’t get it, and you have that very strong fixed mindset, you might say, “What in the hell was I thinking? I am clearly not cut out to be an entrepreneur.”

Drew McLellan:

Well, I have to lower my standards and go after smaller clients or whatever. That that one incident taught me to not do that again. I touched the stove, it was hot, I’m never touching it again.

Pamela Slim:

It’s exactly right. And so you see, when you have that kind of mindset, it’s understandable, who wants to go fall on your face and make change? Change is horrible for all of us that have to go through it all the time. There are a few people who really like it, but you realize from an attitude toward obstacle perspective, you can end up, especially in the early stage of business when your foundation isn’t as clear, when you’re still going through the conscious competence model, this is another thing for my training and development days, you go from being unconsciously incompetent, you don’t know what you don’t know, you have to make it through the conscious incompetence stage where you are just painfully aware about what you don’t know. At that stage, is one where you might tell yourself if you fall into that attitudinal segment, it’ll never work, I’ll never learn, lower my standards, what was I thinking? Right?

What we know is that with practice and feedback and mentoring, sometimes you can move to conscious competence, or you learn, oh my gosh, what was I thinking? That was a good first step, but maybe really what I need to do is I need to do something else. Like I need a business partner-

Drew McLellan:

Or find a partner or something. I still have to solve the problem, I just am not going to solve it the first way I thought I was going to.

Pamela Slim:

Exactly. Right. Yeah. And then finally, of course, you get to unconscious competence where you feel really comfortable. It was so interesting to me from a lifelong learning and development perspective that’s really been the path of my career of really seeing the link between how it is that we see things, how we learn, what we believe about our capabilities and how successful we are going to be. Because the less likely you think that you are able to improve, obviously, the less times that you’re going to practice, which then means you probably never will get there.

Drew McLellan:

Right. So, you’re going to stay in that conscious incompetence, and you’re going to get stuck there?

Pamela Slim:

Yes.

Drew McLellan:

Yeah, yeah.

Pamela Slim:

Or just barely limp through, which is just yuck, what a horrible place to be.

Drew McLellan:

All bloodied and brutalized. Right. Yeah. And then, you think, I’m not doing that again. That’s too hard. Yeah.

Pamela Slim:

Yes. Yes.

Drew McLellan:

Do you believe, based on the research and your 20 some years of experience doing what you do, do you believe if somebody comes to owning a business with that attitude of that rigidity around their capabilities, or their ability to problem solve through something, or to endure the discomfort of learning something new, or muddling through that, is that a learned skill or behavior? Like if I’m that way today, am I stuck being like that forever, or can I learn to be the person who believes, you know what, challenges are part of business. And I have proven over and over again, that one way or the other, I will figure out how to get over that hump, and so, I’m going to push through.

Pamela Slim:

Yeah. The focus of our research wasn’t necessarily digging into that, our ability to change, we were measuring the attitudes as they are. That really does go to the heart of the book, Mindset, which not surprisingly, that Carol argues that the view that I could never change is a fixed mindset, which is a choice that indeed, including our IQ is not fixed, and we can really grow and develop. I think that it’s the fun part of really digging in and beginning to analyze the data, and then looking at ways in which it will be applied, which is basically the work we have over the next five years, is really looking at the live examples of how we apply it with real business owners. To me, part of what is fascinating as a business coach is even as we looked at some of the research and we saw the output in terms of financial performance, or where it is that people were in terms of their annual revenue and some of those demographic information.

There wasn’t as big a delta as you might think between people who had a very fixed mindset and people had a growth, the part that I think is very interesting is it’s usually about the emotional experience of the business owner, is what is that person’s life like when the lights are off, and they’re sitting with themselves? If you’re constantly beating yourself up, if you don’t feel like you’re good enough, that tends to be a really difficult emotional state that you have. That’s the kind of thing where you can still be grinding it out, doing critically great work, your clients can be really happy, but you as a person don’t necessarily feel good doing that work. And for me, that’s a really important part of the equation. I don’t necessarily think that everybody needs to start a business, people can decide that they thought it was a good idea, and then they go back to working for somebody else, which I highly encourage.

It’s one of the reasons I wrote Body of Work, because I was sick of all the nonsense saying, you can only be free if you work for yourself. That’s just not true and doesn’t make sense. But I also think that businesses need core things. It is like a natural ecosystem if you look at a garden, you need to plant the seeds, you need to tell the soil, you need to water it, it needs sun. You can’t just ignore your finances because you hate accounting. I actually talked to a lot of people who were like, “I love what I do, I just can’t stand marketing. I hate marketing, I just don’t want to be in front of anybody”, to which I say, “That is great, show me your budget to be hiring somebody else to do that for you, because your business will not succeed if you do not do those things.”

Drew McLellan:

Absolutely right. Absolutely right. Well, I talk to a lot of agency owners, they’ll come to one of our workshops and we’ll be talking about financial metrics, and I’ll say, “Well, what is your XYZ?” And they’ll go, “Yeah, I don’t know.” And I’ll go, “What do you mean you don’t know?” “Well, you know what, we’ve had a tough six months, and so I can’t look.” I say, “Well, that’s like having a baby and not enjoying the smell of baby food, so you just don’t feed it. The baby can’t survive.” I also think there’s a myth, and I think your latest book addresses this too. I think there’s this weird myth about being self-employed, like it’s basically a circus and your birthday party all packed into one every day. And it’s like, no, sometimes it sucks, sometimes it just sucks. And there are some things, even on the best days that you still have to do that you don’t enjoy and are hard, or boring, or fill in the blank.

I think that’s part of what I worry about when people start their own business, is that they … again, because they’re trying to escape, whatever the cube that they lived in, that whatever they’re going to is going to be so much better. I think sometimes they’re profoundly disappointed when they find out that it still has yucky parts to it.

Pamela Slim:

It’s so true. In Escape, I wrote that hating your job is not a business plan, and sometimes that’s the way that it’s marketed. That’s an important catalyst to get you to make a change if you feel like you’re really ready to make a change. In Body of Work, I talked about a loading scale from one to 10. So if you imagine one is you bound out of bed on Monday morning, eager to go to work, and 10 is you feel physically ill on Sunday night when you even think about working. And really, I’ve met people who are on the 10, and I’m telling you, it very often has very strong health, physical related implications. It’s real when people are not a good [crosstalk 00:21:34]. When you think about it from that side, that is a piece of motivating you sometimes to make a change, but a solid business needs to have a viable product or service that actually creates value for people who have the resources to pay it, and you have to have the means and the capabilities to deliver it.

And so, those are things that you have to figure out. Now, part of what I think is so cool about the new world of work is we have a lot of really creative ways now we can get that work done. I’m probably one of those that as much as possible, just tries to engineer away, the parts of my business that I don’t enjoy doing, and sometimes by improving the operations and automating it. Susan Baier’s actually an expert at this, she’s such a nerd. I love to look at the 20 ways that she takes her basic operations in her research business and optimizes it by automation. She’s such a genius at that, and that, I think is really smart. The other thing is having other people as advisors. I have a great tax attorney who is very happy to deal with the IRS when I don’t want to look at it, and will look at me in the eyes and say, “You must look at these parts of your business in this particular case”, but not all the time.

That wouldn’t be wise if I was spending most of my time in areas that weren’t my strength. But it’s a really common thing. And I get old and grizzled now, I’ve passed 50, so I can do that technically, and I used to-

Drew McLellan:

[crosstalk 00:23:09] like a badge or a card?

Pamela Slim:

I did. Yeah. It was like you could say whatever you want, and nobody can question you because you’re past 50. I did martial arts for many years, and it’s really some of the best metaphors that I can think of. First, I did Capoeira, which is Afro-Brazilian martial art, and I did mixed martial arts in my 40s. I would always observe that there were different people who might come into the martial arts studio, and you can notice a difference in behavior. Some people would walk in and they would see the black belts the first and they were like, I want to do that, and I want to just jump in and do it. And then, there were other people who would walk in and say, I’m brand new, I’ve never done this before, or I come from a different style and I recognize that I don’t know yours, and so I really want to learn the foundation.

It truly is just, I think, part of life and part of business, and definitely a part of martial arts that if you were to go from a first day into fighting other black belts, even if you were physically strong, you would not have the emotional, spiritual, physical capabilities because-

Drew McLellan:

It’s not going to be a good day for you.

Pamela Slim:

It’s not going to be a good day. You have to go through those steps of really learning and gathering the courage. So sometimes, it’s a message that’s not sexy, it’s not a message of make six figures in two months with no effort at all from the beach, and yet, I don’t think it means that you are destined to 10 years of horrible grinding in order to get to a place of success. It’s a combination of good self-reflection, knowing your strengths, intelligent business design, wise counsel and mentorship, and then just dealing with the reality that anything good takes time.

Drew McLellan:

Right. Right. Absolutely. You said something that I want to dig into a little bit, because you know what, for most agency owners, even the wildly successful ones, there’s an age old phrase in our business that it’d be a great business if it weren’t for the clients and the employees. It’s hard work, and it’s a lot of people. No agency owner goes into the office and has the day that they expect to have, because they basically walk in, and all they do all day is put out fires, whether they’re employee fires, or client fires, or financial fires, or whatever it is. So, even an agency that’s doing really well, the work is difficult. So early, early in my career, long before I started my own agency or before AMI, I can remember being in a job and having a guy who was one of my mentors.

And so, I was, I don’t know, 29, and he was maybe in his early 40s, and he said to me, “Drew, advertising is a young man’s game.” And I thought, what is he talking about? Well, you know what, I have the same card that you have, and it is a hard game, and I get what he meant by the energy around it. So, you were talking about before, when you were talking about the research, you were talking about, basically, yes, do you have a fixed mindset or a growth mindset, but both of those can be augmented for the good or the bad based on basically what’s happening outside of work. One of the things I worry about with a lot of agency owners is that they pour so much of their heart and soul into the business. It’s not Monday through Friday, it’s not 9:00 to 5:00, they sacrifice sleep and their family and the other stuff, and I think they’re tired. And I worry that in that state, it is difficult to keep going up to bat, and to keep swinging at the ball.

So, talk to us a little bit about in your work, what it looks like and how do you build that support, and whether it’s people or place, I don’t know what, this is why I’m asking the question. How do you build that place that replenishes you so that you can get back in the game again tomorrow with a mindset and a heart set that sets you up to be successful?

Pamela Slim:

I think that there’s a couple of assumptions that’d be fun to dig into when you look at how it is that work is structured. I know sometimes certain types of professions can just be like you described, kind of the ad agency where that it’s just part of the culture of the way that it is.

Drew McLellan:

That’s controlled gaps.

Pamela Slim:

Yes. That said, I think there’s a way that you can approach business, which is just jumping in with both feet, having the expectation that you’re just available 24/7, you’re going to do whatever it is that you need to do to make things happen. I love that energy. It’s also an extremely dangerous place to be. One of the things I see very frequently that is part of what can help is where you do spend some time in advance really thinking strategically about your business. I always work backwards. When somebody might still be in the cube where they’re really considering working for themselves, the place we start is really looking at what kind of life do you want to have, and how can you begin to design backwards for that? So, you can create certain decision criteria that helps set parameters around exactly what you do and how you do it.

And when you set those parameters, clearly, there can be repercussions, that you can set certain parameters around having maybe just slightly crazed clients as opposed to those that maybe pay you three times more, but are going to be crazed all the time, because you find that you have a very strong value about actually knowing your children, and who they are as they’re growing up, and you know that that’s part of what it is that you decide. It’s one of those qualities of leadership, and even if you’re just working for yourself, or if you have other people, to me, it’s all leadership, where you are effectively and clearly making decisions about what your boundaries are. And I have met people of all ages in all my years of experience, who sometimes are working in the same area in the same field, sometimes even the same company, and some have exceptionally clear boundaries that people respect and other people are like, you can text me at three o’clock in the morning and I’ll jump out of bed and I’ll respond to you.

I don’t mean to discount sometimes cultures where you need to work hard, but part of it is where you’re really clear as to designing from the beginning, what it is that are really your boundaries and then building a business around that. That’s one really important piece. The other piece, which knowing you hang with Susan Baier, won’t be surprising to you, but we don’t define our audiences in a clear enough manner. And that is the drum beat that Susan is always saying, we can’t just jump in and work with anybody, because all clients are not alike, they’re not all matched to our capabilities, and they have very different attitudes toward the work relationships. Clients that are not a great fit for you from a values perspective, from an attitudinal perspective are truly kryptonite to your superpowers. This is what my friend Charlie Gilkey says, it’s just very difficult.

So from that side, I would say there’s some proactive design that you can do, there’s very proactive work that you can do around ecosystem marketing and really investigating, really understanding the reality of where your ideal clients live and hang out, so that you’re not on the road 50 weeks a year knocking on every rotary club door or whatever, trying to randomly attract people that you are very focused in how it is that you do that effort. So, that’s proactive, thoughtful, strategic design that I think is a really important part of the piece you look at. The other piece is where you do really have a combination of thoughtful practices that could be around things around mindfulness, like meditation. My husband, as I said, who’s Navajo, who was raised as a traditional medicine person, one of the many gifts that he gives me on a daily basis is just stopping me from my crazedness and the kids, and before we step out the door, we all get really quiet and we take deep breaths and we ground ourselves.

And I’m telling you, taking one minute to do that as a family makes a huge difference in the rest of our life. So, some of the practices that you can do, being physically active, practicing mindfulness, it doesn’t have to take tons of time, but that can also make a difference. And then, I think the other thing is having really honest, supportive friends. I call them peer mentors, so the people who understand professionally where you are. You’re always going to have your mom, bless her heart, who’s bringing your ham and thinking you’re starving, or somebody in your family who’s just like, “Oh my gosh, you’re working all the time and you’re killing yourself.” Sometimes you can have that feeling of they just don’t get it, they know nothing about my world. It’s really different than when you and I are on the phone, and I’m like, “You know what, Drew, you’re really full of crap.” You actually are making a choice to not hold a firm boundary, which you could hold.

And if I know that, and I’m a peer, I’m not just trying to give you a hard time. I care about you, and I know that I need you to be physically healthy and around for the long-term. So, you need friends like that, who will call you on your stuff, and they have to have a deep understanding of really the nature of the work that you do and some of the challenges.

Drew McLellan:

Yeah. Yeah. Well, and that’s why. That’s one of the reasons why I think mastermind groups are so powerful. I know that you and Susan and Chris are in one, and I’m in a couple, one is a virtual one and once a week are physically in the same place. Those are the people who more often than not will go, “Why are you making that assumption, Drew? Do you hear what you’re saying?” And they p