Episode 362:

Are you making yourself irrelevant in your agency? We’ve been talking a lot lately about how important it is to have systems and processes in place so you can work less and get back to doing the parts of agency ownership that you love. But if you or anyone in your agency becomes irreplaceable, you will be stuck in your 60-80 hour work weeks.

This week, our guest Jesse Gilmore gives us a thorough breakdown of how to identify single points of failure in an agency—Hint: it’s often the agency owner—and how we can create a better flow that helps everyone work together more successfully. When we give our employees the tools they need to work effectively and delegate with other team members, our whole workflow improves no matter who’s out of the office that week.

A big thank you to our podcast’s presenting sponsor, White Label IQ. They’re an amazing resource for agencies who want to outsource their design, dev, or PPC work at wholesale prices. Check out their special offer (10 free hours!) for podcast listeners here.
single points of failure

What You Will Learn in This Episode:

  • How to identify single points of failure in your agency
  • If you’re the single point of failure, how do you make yourself more irrelevant?
  • Why removing single points of failure is vital for scaling your business
  • How to create systems and processes that aren’t cookie-cutter solutions
  • How to carve out time in your already busy schedule to put systems in place
  • What is the difference between a bottleneck and a single point of failure?
  • Timing out changes to your agency’s systems and processes
  • How removing single points of failure can improve agency culture

“A single point of failure is when if someone is gone, then the business literally can't either do business or do it at the same quality.” Jesse Gilmore Click To Tweet “I wanted to teach the world what I learned so that other people didn't have to go through what I went through.” Jesse Gilmore Click To Tweet “I started to see how impactful it can be when you create predictability in an agency, focus on client results, and make that predictable. It's like you become this diamond in the rough.” Jesse Gilmore Click To Tweet “You want to create a culture where people are advancing; they're innovative. They use the processes and the systems because they know they are a winning team.” Jesse Gilmore Click To Tweet “It's really enabling standardization and process to allow you as an entrepreneur to live your vision. The vision that you had at the beginning of your agency.” Jesse Gilmore Click To Tweet

Ways to contact Jesse:

Resources:

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 White Label IQ. Tune in every week for insights on how small to mid-size agencies are surviving and thriving in today’s market. We’ll show you how to make more money and keep more of what you make. We want to help you build an agency that is sustainable, scalable and, if you want, down the road sellable. With 25 plus years of experience as both an agency owner and agency consultant, please welcome your host, Drew McLellan.

Drew:

Hey, everybody. Drew McLellan here from Agency Management Institute. Thanks for joining us again for another episode of Build A Better Agency. We are going to be talking today with an expert in how to avoid single points of failure inside the agency. So different than a bottleneck, a single point of failure, oftentimes, by the way, is us, but it is really about looking at where is one person or one resource a risk for you in terms of what happens if they go away, what happens if they get hit by a bus, what happens if they get hired, what happens if they just can’t sustain the energy level or the output level anymore. So going to be an interesting conversation.

Before I tell you a little bit more about our guest, I want to remind you about a tool we haven’t talked about for a while. So last year, we put together a report card so agencies could measure how they’re doing in terms of equity and diversity and inclusion. So if you would like to look at that report card and see how the agency’s doing, and many agencies are using it quarterly or semi-annually to check their progress, you can go to agencymanagementinstitute.com/racialequity. Again, agencymanagementinstitute.com/racialequity, and you can download that report card. You can modify it to serve you differently or better, but it’s just a free resource that we would like to make sure that you know is available to you. All right.

So let me tell you a little bit about Jesse Gilmore. Jesse, interestingly, entrepreneur, had owned several businesses, and was, by his own admission, the single point of failure in some of his businesses but didn’t realize it at the time, decided to go back and get some more education. When he did, he learned about single points of failure, and through an internship and other things, he realized what a critical element of business this was.

Now, he has a company where all he does is help agencies and other businesses identify their single points of failure and then systemize or process their way out of that problem. So really interesting guy, really knowledgeable, and I think you’re going to really love the conversation. So let’s get to it.

Jesse, welcome to the podcast. Thanks for joining us.

Jesse:

Awesome. Thanks, Drew, for having me.

Drew:

You bet. Tell everybody a little bit about your background and how you have come to be somebody who’s thinking about this idea of a single point of failure.

Jesse:

Sure. Absolutely. So I became an entrepreneur in my 20s. I actually started my first business with my brother when I was 20 years old. It had just come from doing door-to-door sales, where I was talking with business owners all the time. I was always asking them, I’m like, “How do you make a successful business?” and whatever their answers were, I started cataloging different notes. So I thought that that was what it took for me to run my own successful company.

So me and my brother, we applied that knowledge and we found that as the business started becoming more successful and we started becoming more popular, our hours started to increase. So what ended up happening was is that it took us a long time to get a proof of concept, finding clients for your service, being able to have a predictable result driven from that to the point where in the five years at the end, we were becoming more successful, hours are too much, working 60, 80 hour weeks for years, and we just burnt out. We actually dissolved the business at the time where it was actually the most successful, and didn’t-

Drew:

Huh.

Jesse:

Yeah, and so-

Drew:

I think the whole idea of the 60 to 80 hours and the burnout, I’m sure a lot of listeners are feeling that pain with you. Yeah, yeah.

Jesse:

Yeah. A lot of clients, before we were start working together, that’s a lot of times what the bigger problem, but we’ll tackle that in a little bit. I didn’t really understand what was wrong, so I started another business, and another, and within those three businesses, it was the same exact thing. I was constantly trying to apply what I had learned before, but if I didn’t work, work didn’t get done. So I felt constantly a slave to the business. So I ended up sucking up my ego, going back to school, and I started working as an intern for a four billion dollar global corporation. I started working in HR, and very quickly, they realized I wasn’t the typical intern.

Drew:

I’m sure.

Jesse:

They were like, “Here’s three months worth of work,” and I was like, “I got it done in three weeks,” and they’re like, “Ah, okay.” So I started working under the VP of HR and she told me … Judy was so great. She was like, “I’m going to give you a project you can’t complete in such a short time,” and I was like, “Okay.”

She’s like, “We have a problem,” and this will all relate to single points of failure but, “We have a problem. We have a whole bunch of people that are going to retire, that have tribal knowledge in their heads of how to make the metals that go in space stations.”

So the company basically had SpaceX as a client. What the goal was is to systematically remove all single points of failure in the business through training, operation systems, creating integrated business management systems. So that way, it didn’t really matter who was doing the work. The work was able to get done so that way they could make that.

So I was on this mission. My sole mission in corporate America for about six years was working with VPs and this chief human resources officer of this four billion dollar global corporation to basically build a system to take all this tribal knowledge from the people that it took them 25 years to learn and make it to where someone could learn that in a much shorter period of time.

So during that time, I learned a lot about business systems, but actually, the big aha moment was when it finally got implemented and then one of the facilities got sold and I was like, “Oh, this makes it actually profitable, and this is how acquisitions work,” and all that kind of stuff. From that I go, “Oh, my gosh. It was the thing that was missing. I was the single point of failure in my own businesses. As I took on more clients or became more successful, the hours increased and it was like this rat maze.”

Drew:

After a while, you just can’t, it’s not sustainable.

Jesse:

Yeah, and it’s like everybody’s human. If you’re doing the same thing over and over and over again without progression in your own company, then burnout, but also, you become complacent, you don’t believe in the vision that you originally had when you first started the agency, right?

Drew:

Yup.

Jesse:

You got to have some type of progress and it’s a progress and develop in your own self. So towards the end, I actually was part of that facility that got sold. So during the acquisition, I saw how change management works in organization, the integration between two different systems now and how to build it into the new system. From that, I realized that I wasn’t fulfilled and I had learned enough from it just like the door-to-door sales. I learned enough that I was ready for something new.

So I started consulting and I didn’t really have a focus on it other than I knew this business systems and predictability was my new thing. I wanted to teach the world about what I learned so that other people didn’t have to go through what I went through, which is part of the reason why I’m actually really excited about this conversation.

So when I started Niche in Control, so that’s the company that I have, it’s my fourth business, Niche in Control originally just started as a consulting business, really focused on business systems. One of my first clients was a business that was a SaaS company, and they had a single point of failure where their vendor, so the person that actually did everything when it came to development and all that kind of stuff, was their single point of failure, and so they couldn’t actually get out of the contract. As the vendor started raising their prices, they were losing profit margins. They didn’t know how do that.

So I actually stumbled upon marketing agencies through a mastermind I was a part of, and it was an accountability partner and I was like, “Oh, you’re digital marketing and I’m systems, and you need digital marketing.” So we started working together and I started to actually see how impactful it can be when you create predictability in an agency and really focusing on client results and making that really predictable. It’s like you become this diamond in the rough and it’s like, “Holy crap!”

One of my first clients that was a marketing agency went from 15,000 per month to over 100,000 per month in nine months, and then it became monthly reoccurring on the 12th month. It’s all based around the things that I’m just about to describe with single points of failure, removing them, setting up predictability within the whole business, and really making it to where that marketing agency owner is no longer the six-figure hustler, and they’re more like a seven-figure CEO.

Drew:

Yeah. So as I’m listening to you talk, I’m hearing the listeners, the agency owners in my head saying, “That’s great, but our world is every client’s unique. They all want something different. We don’t do cookie cutter. So how in the world can we create that kind of systemization or process?”

Jesse:

Yeah. So in the agency world, there are two main schools of thought you have. Either you’re a complete productized agency, where you’re serving the average of the agencies that are out there, not really solving a specific need, and then there’s the customization, where you are bending over backwards for the client, doing everything for them, and everything is new. You’re reinventing the wheel.

When I realized these two schools of thought, they’re not really seeing that there’s 75% of what you do for a client that’s the same. It’s the same for every client on how you maybe onboard, but there’s 25% that is custom to the client. The key is to make that 75% as systematic as humanly possible, as predictable, efficient as humanly possible, and then that actually frees you up to focus on the 25% that’s custom to the client. When you do this, you’re creating what I call scalable customization, where you’re not only getting the speed and efficiency, but you’re also giving the client exactly what they’re looking for.

Drew:

Okay. So let’s talk about what gets in the way of creating this easier, better way to do the work.

Jesse:

Honestly, it starts off with time. People always think that they don’t have enough time to do something. The key is us you must carve out time and make this a priority. So that’s the first step. The second step is really just understanding that there is a systematic way of removing these single points of failure. I think it’s really the third one is based around buy-in, especially if you’re a larger organization. People get resistant to the idea that they’re not going to spend as much time working on the client’s work and they’re going to focus more on systems and processes and things like that, which if you’re looking at a utilization standpoint, yeah, the utilization might dip a bit, which is always nerve-wracking for anybody, but the key is is to put control limits on it and do it more at a continual pace, not really focus so much on the destination of getting every single standard in place, which is impossible, and really focusing on really getting just a pace at which standards are made. We’ll talk a little bit about strategy when we get into a single points of failure, but yeah.

Drew:

Yeah. So let’s define that. So what is a single point of failure and how is it different than a bottleneck?

Jesse:

Yeah, absolutely. So the easiest way to describe and understand the difference between a bottleneck and a single point of failure is to first off understand the value stream. For anybody who’s never heard of value stream described before, the easiest way to understand this is view it as a picture, and it starts off with a faucet, and the faucet turns on, and the water that comes through the faucet is leads. The leads go through different pipes through this journey of going from a lead to a prospect, to a client, to completing the client agreement.

Throughout this faucet and this journey, the water is going to fall through four different containers. First container is client attraction, otherwise known as prospects conversion to an appointment. The second one would be a client conversion, which is appointments into clients. Third one would be client fulfillment, so actually completing that client agreement, and the fourth one would be customer support and account management. On the other side of this whole value stream is what’s called throughput. For anybody who’s in operations, they know it’s the continuous flow of value through that system.

So a bottleneck is really where there is some type of constraint that’s holding that flow of value from becoming optimized. So you might have it to where the leads are coming in, you have no problem getting appointments, you have no problem making those appointments into clients, but you might have a problem when it comes to fulfillment. Now, you you know you have a problem or a bottleneck when it comes to fulfillment if the timeframes that you’re projecting are off or the cost structure is off or the client-

Drew:

Yeah, you’re not delivering on time or on budget.

Jesse:

Yeah, and then if you have a bottleneck in client fulfillment, one of the things that I see as a big trap is, usually, agencies will just throw account managers at it. So they’ll go, “Oh, I’m just going to hire more account managers,” when they’re not actually fixing the root cause, which is streamlining client fulfillment. So that is a bottleneck or just a constraint of the flow of value.

Now, in comparison, the single point of failure, let’s just take, for example, that there’s no bottleneck. So it’s a continual flow of value, everybody in the business is doing what they need to, it’s normal, but when a single point of failure is there, it’s when an individual could be a founder, could be an employee, could be a contractor or a vendor, and if they’re absent from the business, the business can no longer function as it has or produce the same quality of value to the clients. So a single point of failure is where if someone is gone, then the business literally can’t either do business or do it at the same quality.

Now, the single points of failure are pretty much in every single business up to eight figures. If you’re in a six-figure business and you’re trying to get to seven, the single point of failure removal is actually you as the founder. So that’s your journey to removing you as a single point of failure. If you’re a seven-figure agency going to an eight figure agency, you know that the game that you’re playing is not necessarily client acquisition, it’s talent acquisition.

The way to stand out as an agency and grow from seven figures to eight figures is based around getting your whole business to become this business system and removing single points of failure. So it might be your employees. It might be contractors, getting rid of contractors that are single points of failure so you can bring them in-house for employee. From doing that, your biggest challenge as a seven-figure agency is buy-in. So you got to get people to buy into it.

I’ll talk about a strategy in a little bit that’ll actually help those seven-figure agencies to be able to prioritize standardization and do it in a way that actually allows your team to build teams and process to build processes, which is ultimately one of the greatest things that as an employee working in a company, if you can leave your fingerprint on the business and be able to make a difference, that’s how you do it. You’re actually empowering your people by doing so. So I get really passionate about it, Drew.

Drew:

Yeah. Well, it all sounds great until, and again, I’m channeling the listeners, until I think about, “Oh, my God, how do I actually do that?” So first of all, how do you identify that you have a single point of failure? Is there a process or a thought process or a way to look at the business as objectively as possible when you’re inside of it to see that you actually have one of these?

Jesse:

Yeah, absolutely. There’s a series of questions that I actually do in my live webinars because they are an idea where if you can answer these questions, if you’re wondering about a single point of failure or bottlenecks in your business, single point of failure, so the first question for you is if you took a two to four-week vacation from your business, would it sustain or grow without you? So always start internal. Always start with you first, right?

Drew:

Yeah, right.

Jesse:

Then the second one would be if one of your vendors, so I’m sure that everybody that’s in the audience knows the difference between a vendor and a contractor. A vendor is where they own the process, and they’re basically doing it as a part of you or a contractor follows your process. So when I use vendor, I’m talking about strategic partners, but if one of your vendors raised their prices, and you wanted to leave, could you do so without the customer being impacted? So that’s the vendor one. Then for an employee or contractor, if one of your top employees or contractors left, would your quality of service stay the same in the eyes of your client or customer?

Drew:

Yeah. Good questions.

Jesse:

Yeah. So those would be your identifying factor. Okay? Now, I found the single point of failure. Let’s just say it’s me as the business owner.

Drew:

How often is it the owner?

Jesse:

I would say nine times out of 10, unless you research business systems and you’re a geek like me about it. Yeah. It’s something that’s just very apparent until you hit about eight figures. Again, when you hit eight figures-

Drew:

Sure, right. It’s different. Yeah.

Jesse:

… you’re developing years of leaders and it’s a different game. So if it was you, then the step-by-step process is just to start by regaining your time because you want to make it to where once you start doing this, you don’t want to stop and you want to make it at a pace that is like the marathon because as an entrepreneur, you’re on a marathon of entrepreneur. It’s not about the destination of achieving whatever. It’s about consistency.

So regaining your time, and the key is is to carve out eight to 10 hours per week for you to work on the business, which allows you to have the space in order for you to focus on this project. Now, I know what the audience is probably listening is probably thinking it’s the same thing that all my clients were thinking originally, “How am I going to carve out eight to 10 hours to work on the business? I’m already working 60, 80 hours.”

Drew:

Yeah, 60 hours, right.

Jesse:

Yeah. Then the key is is actually just to make it so it’s not added time. The way that you carve it out, there’s a four-step process. I have a whole YouTube channel that’s all based around really carving out this time because it’s the foundation for everything. I’ll send it to you, Drew, and you can put it in the show notes, but-

Drew:

Yeah, that’d be great. Thanks.

Jesse:

Sure. I’ll summarize the four-step process. It’s pretty simple. You just need to do a weekly time log where you understand where your time is going. You got to start off with some data. Then from there, you want to go through a series of asking yourself, “What can I eliminate that I’m doing right now?” So start off by just eliminating stuff. A lot of times people go, “Oh, I’m just going to automate,” or “Oh, I’m just going to do whatever,” and it’s like, “Do you actually even need to do it?” So start by removing.

Then if you can’t remove it, then look into automation. Now, automation is one big shiny object, unless you know exactly how to use automation correctly. The way to know whether or not something should be automated is based around is it, first off, tedious. Second off, is it a data transfer? Any one of the data transfers, usually Zapier can do some type of integration. Is it something that is predictable? So it’s same thing that happens over and over and over again. Then if it is those things, is there a way of making sure that it’s ongoing? So you don’t want to automate something that’s temporary for only a month or so.

So from automation, so following again, eliminate tasks if you can eliminate them, try to automate them, working on those repetitive tasks. Then if you can’t do either one of those, then you move into delegation, and delegation is really, really key to do it effectively. There’s a lot of people that will just go, “Do this,” and they’re like, “Okay. Well, how do I do that?” or “How do I know I’m successful?” and stuff. So delegation is really key.

Really, when you start to look at what needs to be delegated, depending on what level in your agency you are, six-figure, seven-figure, delegation might be a little different depending on what it is, but delegation is really impactful if you do something where you can explain it in something like a Loom video. For people that don’t know what Loom is, loom.com, you can create little screen shares-

Drew:

Tutorial videos.

Jesse:

… with your face and you can explain stuff. This is a really good way of just capturing whatever knowledge you’re trying to pass on. The reason why it is actually I believe superior to giving the assignment in an in-person meeting is because can rewatch it and then they can ask questions about it.

Drew:

Of course.

Jesse:

So effective delegation is key. Then the four steps, so if you can’t delegate it, can’t automate it, can’t eliminate it, then the key is is to do what’s called time boxing. Time boxing is really where you allot a certain amount of time for a given activity, and you go into deep work, where you just turn on your phone. Let’s just say, Drew, you’re like, “I’m going to do this for 30 minutes.” Take out your phone, put a timer on, say 30 minutes, shut off all distractions, and go into it. The reason why this is super important is because you want to minimize what’s called task switching, which ultimately is creating your own mental rework, and by doing so-

Drew:

It takes so long to get your brain back to where it was, right?

Jesse:

Yeah, yeah. You can also, I mean, without going so much into models and it’s like that, there’s a Parkinson’s law, which-

Drew:

I talk about that all the time. Yup. If you give it eight hours, it’ll take eight hours. If you give it an hour, it’ll take an hour. I mean, it sounds ridiculous, but you just see it over and over and over again. Yeah. All right.

So let’s say we have carved out the eight to 10 hours. Now, what do I do with that time to identify and remove the single points of failure? So that’s what I want to talk about, but first, let’s take a quick break and then we’ll come back and figure out how we actually do that.

Hey, sorry to interrupt, but I wanted to make sure that you are thinking about how to connect with your clients by figuring out what they love and maybe a few things that they’re not so crazy about with your agency. So at AMI, one of the things we offer, our Client Satisfaction Surveys. We do both quantitative and qualitative, so an online survey, but also interviews with some of your key clients. Then we come back to you with trends, recommendations, what they love, what they don’t love, lots of insights around how you can create an even tighter relationship with your clients.

So if you have interest in that, you can go under the How We Help tab on the AMI website, and very bottom choice on the How We Help tab is the Client Satisfaction Surveys. You can read more about it, but whether you have us do it or you do it yourself or you hire somebody else, it is really critical that you be talking to your clients about what they love and what they wish was different or better. So do not miss the opportunity to tighten your relationship with your client, whether we help you or not. All right? All right. Let’s get back to the show.

All right. We are back with Jesse Gilmore, and we’re talking about single points of failure, which, again, as a reminder, different than a bottleneck. It is literally that if you or a key partner or an employee slash contractor go down for the count, get sick for an extended period of time, get hit by a bus, take a different job, whatever it is, that that is going to have a dramatic impact on your ability to serve your clients and to deliver on your promises.

So right before the break, I asked Jesse. Okay. How do we identify these single points of failure and more importantly, how do we remove them?

Jesse:

Absolutely, and because once you have carved out those 10 hours, the question is, what do you do with it? The starting point is really just brainstorming the documentation of processes and the things that you’re doing. If you are the single point of failure, which the majority of people listening to this will be, you start there. Then just identify everything that you’re doing within the business and start with client fulfillment because that’s going to be your first usual bottleneck. You can’t really be confident in marketing and sales if you don’t have predictable client fulfillment.

So you start by starting from a really high level, identifying all the roles within a business. Now, roles differ from titles as roles are what you actually do. Examples would be like bookkeeping, purchasing, sales, PPC campaigns, whatever it is. Then you start to underneath each one of those roles identify and list out all the different tasks that that role performs. So a task is an activity that needs to be accomplished within a defined period of time or by a deadline to work towards work-related goals. So it would be like writing purchase orders or sending a proposal or whatever it is.

Once you understand it, and one of the tricks that I learned in corporate America when we were doing this is we started to look at every single process in every single role. What is at the beginning? What’s the start of that process? Then how do you know when it’s done? Then what kind of milestones? How do you know that you’re on track going from A to Z? Then from there, start looking at what happens before this task in order for it to be set up correctly, what happens during this task in order for us to add value, and what happens after this task to pass it on in succession.

Drew:

Give us an example.

Jesse:

So client onboarding for an example. So if you’re looking at client onboarding, it may start with the client signed an agreement, right?

Drew:

Yeah.

Jesse:

The next step in that process may be did they pay, and if they paid the invoice, we can move forward with our process. If they didn’t pay it, then we got to follow up with them. If they paid the invoice, okay, what’s the next step? If the end of client onboarding is kickoff call, okay, what do I need to do? I need to schedule the kickoff call. I need to build the presentation. I need to get my team members onboard, and I want to make sure that the presentation, everything that we’ve done before the kickoff call is correct. Once that happens, then that’s complete.

So that is really where client onboarding would be a completed process, where you know each different milestone within that process. That way, you can start creating standards for each part of that process, which basically starts to remove you as the single point of failure.

Drew:

Okay. So I’ve now identified there’s a single point of failure in that process. What do I do to then eliminate? How do I eliminate that? Do you understand what I’m saying? Okay. I now know that I, Drew, am the single point of failure in this part of the onboarding process. So where do I go then to find the solution so that I don’t … Because I think probably most of the listeners are like, “Yup. I’m the single point of failure here, here, and here,” right?

Jesse:

So the key really is to prioritize the single points of failure. Once you’ve identified them, you need a priority. So the way to figure out priority is based around high frequency, high risk if it’s done wrong, and then high variability. So if there’s a variability in the results, it’s unpredictable, it doesn’t really give you confidence or certainty within the business. Once you’ve identified what single point of failure you’re going to tackle, then you go through a process of standardization.

The key is is to start from a really macro high level first. I call this the guidebook, and the guidebook is basically like a tree trunk. It’s unchangeable. It’s the same for every client, and it’s at a high level to where you don’t really have to change the guidebook very often. It’s different from an SOP, where an SOP is like the branches of the tree. The guidebook is that 75% that’s the same for every client.

So with that, how do you do that? You start to list out checklists. For a lot of my clients, I call it the process to checklist, where you’re basically looking at three types of checklists within the guidebook, one of them being the instructions, so how to complete the task, the step-by-step instructions. You can do that through the Loom video. I was talking about it earlier.

Within the instructions, you want to think about that before, during, and after the task. So before, what needs to happen before the task can be completed? Does anything need to be set up or information gathered? What materials are needed in order for you to do the work? During, what happens or what needs to happen in order for the task to be completed? How are you adding value? Then for after, you can ask yourself, “What needs to happen to bridge the gap between the completion of this task and the start of the next one?” So that’s instructions.

The second type of checklist is really those message templates, so what messages need to be sent, usually email. It can be sent as a email template, but if you find that the emails that you’re sending are basically the same for every time that you’re at client onboarding and you’re scheduling a new kickoff call but the dates are changing, then that can be templatized.

Then the third type of checklist, which a lot of people miss out on or forget about, is quality assurance, and this is really where you’re defining whether the task was completed correctly, “Do we have this? Do we have that?” So that’s the guidebook. Once you’ve gotten that unchangeable stuff, then you start to move into SOPs or the branches. So these are the things that are more specific. They might change often. So for any ad agencies that are listening, it’d be an example of managing a campaign in Google. Google changes in algorithm. You got to change the SOP. You don’t want to change the guidebook.

With SOPs, you go through that same prioritization, prioritization of standards or single points of failure, where you’re looking at the high frequency, high risk, high variability, but with SOPs, you are involving others a lot more and you get more into this group validation. The way you do that and the way that I did it in corporate America to make it to where groups of 500 are all agreeing on a standard, which is hard to do-

Drew:

No doubt.

Jesse:

… is you start by doing some informational interviews, so get people to individually contribute. Then you start to look at the commonality between their answer. So what questions are you asking? You’re basically asking them the same questions that we did in the guidebook, where we’re looking at what do you do before the task, during the task, after the task, but now, it’s more specific to that SOP, that focus.

From there, you can take the informational interviews, summarize them, and present them to the whole group, and get group validation. So that makes it so that if you’re missing something or best practices, everybody’s contributed, and you can start to find that collective knowledge.

Drew:

How long do you allow that process to happen because again, Parkinson’s law, right?

Jesse:

Yeah, yeah, totally, and these are good questions, Drew, but I wouldn’t say … It really depends on the scope of the SOP of whatever you’re trying to create. I would look at scope of SOPs, and if it’s taking too long, break the SOP or the standard into manageable pieces, so that way you can work through the agreements together, but what’s more important than anything is buy-in, and then if you get to a point where you’re, depending on the size of your organization, if it’s smaller and people are not agreeing, and there’s three people and there’s two, you basically have to have a standard and you’re just trying to prove that the standard works, but if you’re a large organization and you’re trying to make standards or improve on those standards, then you need real data behind it, and the data actually trumps it. Does that answer your question, Drew?

Drew:

Yeah, I think so.

Jesse:

Cool. Now, aside from all of this, once you’ve created the SOPs, you need people to be held accountable, right? So one of the ways that we instruct our agency clients to do is, and once you create that SOP, then you distribute it to the people that are going to be using it. They have to sign that they understand it, that they’re going to start using it, and they’ve received it. Then you start to hold them accountable.

So I always taught in management that you document, you train, you manage, and then you audit, and that’s your stages of evolution. So the auditing, if you’re a six-figure agency, it’s most likely going to be you. When you’re a seven-figure agency, then you’re wanting your C suite to be this random auditing overseeing management, right? That culture of accountability, if people are not following it, and you make this a part of your culture, having the accountability there, it’ll make it to where people will actually start raising their hand if people are off or they’re not doing it correctly, which is ultimately what you’re wanting. If someone who’s not following the standard is trying to find a better way, then you still want that innovation, so you don’t want to stomp out the innovation part, but you want to use data to determine improvements and such.

Last but not least when it comes to a strategy from another high level, if you’re working yourself through this business system and removing single points of failure, as an owner, you want direct them through client fulfillment first, client attraction, otherwise known as marketing, second, and then client conversion, which is sales-

Drew:

Sales, right?

Jesse:

… third, yup. Then the admin and other processes, if you have admin people, they can be doing this all the time, anyway, but if you’re working with your direct team and you don’t really have the admin support as much, then that’s the strategy that you want to do. That’s the way to really free you up as an owner to transition out of hustling into that CEO so you can focus on growth or-

Drew:

Yeah. It makes sense. It makes sense. First, we’re going to take care of the clients, then we’re going to figure out how to get more leads, and then we’re going to figure out how to convert. I mean, that order makes sense, I think.

One of the things we haven’t talked about is we’ve talked about this in terms of, okay, let’s eliminate the single point of failure. We’ve talked about it in terms of the owner getting away from the 60 to 80-hour work weeks. One of the things we haven’t talked about is as we wrap this conversation up, I’ve been thinking about the fact that this also not only helps the owner get out of the day-to-day, but it helps all the other employees get better faster. So can you talk about that for a quick second?

Jesse:

Yeah, absolutely. So what you do in operations can be applied towards training, towards onboarding, towards career development, towards succession planning, and it really empowers the people where, originally, it feels like standardization. You’re moving a boulder up a mountain because it never seems to end, but what you’re actually doing is you’re giving people a way to win.

If they don’t have these standards and they are the single point of failure, then they think that that’s their job security, when in actuality, that’s not the culture that you want to create. You want to create a culture where people are advancing, they’re innovative, they use the processes and the systems because they know that they are a winning team. When you have the single points of failure, then it’s like these information silos and it’s a different culture.

So when I look at how this can be applied to real ROI of standardization, so think about what we just did. We made it to where you’re freed up with your time, you’re focused on single points of failure, you’re starting to remove them in a systematic way, you’re removing the unpredictability, the variability, the risk, and you get to a certain point where you’re able to look at your business from a place of vision and perspective and you know where it’s going. You can hold people accountable, which is really, really awesome.

When you start to use these standards as a way of onboarding new employees, this is really where you start to scale. When you take those standards and you start to organize them as a curriculum or a training for a new hire, you can shorten the time period it takes for them to go from new hire to independence in the role. This is ultimately how one of my clients went from the 15,000 to 100,000. We did this whole thing and we took everything out of his head, and then we put it into the guidebook and then the SOPs, and then we organized it based around certain jobs.

So we looked at an account manager. What did they need to know, and what’s some of the basic work that they need to get exposed to first? What’s that really hard stuff that’s going to be a lot later? What’s the timeframe that we’re going to expect them to be at? Then take all those standards, put them into a Thinkific course and then send it out. When you do that, you can track training, you can track everything. What happened was is that he took an account manager that used to take nine months to independence down to three.

Drew:

Wow.

Jesse:

When that happened, it was like that.

Drew:

Yeah. Yeah. All right. Last question. How long does all of this take because it sounds grueling and hard? I think you’re talking to somebody who’s already working 60 to 80 hours and they’re like, “Okay. First, I have to find eight to 10 hours, and then I have to do this process by process by process.” How does somebody wrap their head around this? What’s a realistic timeframe to accomplish this because it sounds, on the other end, it sounds like it would be amazing, but getting there, the journey sounds challenging?

Jesse:

Yeah. Honestly, I’ve found that it really depends on the agency itself. Full service agencies take the longest.

Drew:

Sure.

Jesse:

You got way too many things going on. Usually from the process of doing it with the full service agency, they really realize that they have a core competence and then they double down the competence and they grow.

Drew:

They understand.

Jesse:

Yeah, and if you have a small number of services, it goes a lot faster. Some of my clients that have done this, they were able to get a minimum viable guidebook created and it doubled their profit margins in three months.

Drew:

Wow.

Jesse:

That was a small six-figure agency. The larger the organization, most likely the harder or the longer it’s going to take-

Drew:

Sure, of course.

Jesse:

… just based around the process, but yeah, I’ve seen it take anywhere from two months for a small agency to 12 months for a larger or a multi-service agency, but the return on it, if you’re tracking, time tracking, which I highly recommend-

Drew:

Me too.

Jesse:

Yeah. If you’re tracking time, then you can start to see the results, and especially if you have that prioritization that we talked about earlier, Drew, where you’re focused on the high frequency tasks and then the high risk and then high variability, you should be able to actually start to see the qualitative return on it. Some of my clients also that took the longest, when they were nearing the end, they had all of the buy-in from the group, and everybody going, “Let’s do this,” and then they got acquired.

Drew:

Which I guess for many businesses and agencies, for sure, that’s part of the goal is to make yourself sellable, for sure. Yeah. This has been fascinating. This is such a challenge for agencies as you know with your work with them. I guess appropriately, you’ve created a system or a process to fix your systems and processes. So I think you’ve outlined for everybody a really tangible way even to just tackle one or two processes, where a single point of failure really puts them at risk, and then they can decide if they want to go deeper and do the rest of the organization.

So I suspect this has been a really helpful practical episode. So thank you so much for sharing your expertise and the passion you have around what for many agency owners is a frightening concept, I think.

Jesse:

Yeah, and to close, Drew, it’s really enabling standardization and process to allow you as an entrepreneur to live your vision, the vision that you had at the beginning of your agency, where before everything became so complicated.

Drew:

Which probably was not an 80-hour work week.

Jesse:

Which was probably, for a lot of my clients, they wanted to spend more time with their kids, and then they’re working 12 to 14-hour days six to seven days a week.

Drew:

Yeah. Well, and maybe that’s all the motivation we need is a reminder that when we started the business, we had this vision and the vision was a mix of things. It was probably a more personal time. It was wanting to help more people. It was probably wanting to make more money and that the bottlenecks and the single points of failure get in the way of all of those things. Yeah.

Hey, this has been great. If folks want to track you down, if they want to talk to you more about the work you’ve done with agencies around this systemization process and eliminating single points of failure, what’s the best way for them to track you down?

Jesse:

Absolutely. I just created a free training about the method that we use and a free case study as well. You can go to nicheincontrol.com/freetraining. That’s the easiest way to understand how we use an inside out perspective called Leverage For Growth to systematically scale agencies. Otherwise on our website, nicheincontrol.com has pretty much our two programs. We have a mastermind called Alliance. We have a team coaching program for us to help build out the C suite, those seven-figure agencies that are looking for this applied to their C suite. Then we also have a YouTube channel. So if everything that we talked about with carving out the eight to 10 hours seems really daunting, I’ve just finished the eight episodes or eight value-packed ways of looking at time and becoming a time master.

Drew:

Awesome. All great resources. Thank you again for being on the show and for sharing your expertise with us. I appreciate it.

Jesse:

Yeah. Thanks for having me.

Drew:

You bet. All right, guys. This is an episode that is packed with to-dos, which I know you don’t want more to-dos, but I think the point that Jesse made is it’s the right to-dos. So it’s about getting rid of some of the things on your plate so you can focus on the business. So as we’ve talked millions of times, this is shifting you from working in the business to working on the business, which is what allows the business to scale and grow. I think Jesse gave you a ton of practical tips, tools, next steps, and lots of resources to go and review. If this wasn’t enough, if you want more meat on the bone, it sounds like the website and the YouTube channel have lots of resources for you.

So I know that oftentimes we don’t love the word system and process. It feels less creative, but remember, this is on the business side of the business. This isn’t about the work we create for clients. The more you can systemize and standardize that, the less critical you are to the process.

One of the things that I think is hard for agency owners to wrap their heads around is your whole goal is to be irrelevant in your own organization. In terms of the day-to-day work, your job is to be irrelevant. For many of you, that is a far distance from where you’re at now. So I think this episode gives you some ways to become ironically more irrelevant, which I think should be everybody’s goal.

So with that, I’m going to let you go, but quickly before we do that, I want to thank our friends at White Label IQ. They are the presenting sponsor of the podcast. So they make it possible for us to come and see you. They do white label design dev and PPC, and they are the saviors for many AMI agencies. So you can check them out at whitelabeliq.com/ami, and they have a special price. Actually, I think it’s some free hours on your first project there for you as a podcast listener. So many thanks to them, and as always, many thanks to you for making the time to be here on the show, to join us, and to let us come into your world for an hour or so every week. So I am grateful for that. I’ll be back next week with another guest to get you thinking a little differently about your business. All right? Until then, have a good week, and I’ll talk to you soon.

That’s all for this episode of AMI’s Build A Better Agency Podcast. Be sure to visit agencymanagementinstitute.com to learn more about our workshops, online courses, and other ways we serve small to mid-sized agencies. Don’t forget to subscribe today so you don’t miss an episode.