The Importance of Having an Explicit Vision Throughout Your Organization

Cole Abbott (00:00:00 -> 00:00:05)

So now we're moving into the nine core competencies. Yha, fun

Mark Abbott (00:00:05 -> 00:00:06)

Im looking forward to it actually.

Cole Abbott (00:00:06 -> 00:00:06)

Yeah. Are you?

Mark Abbott (00:00:06 -> 00:00:08)

I am Honestly <laugh>.

Cole Abbott (00:00:08 -> 00:00:49)

That's good. I know. Yeah. It's better than to not look forward to it. <laugh>, we're just dreading, dreading talking about what we do for a living. The core competencies of dread. Yeah. So, right. It's, it is important going through the nine Yeah. To give them some priority and some hierarchy. Yes. Right. Because can't, hundred percent, you know, you can't just go through all of them differently. It doesn't, doesn't really work. Yeah. So to start off, you know, we think it's wise to begin with vision. A hundred percent, right? Because that's where everything comes back down to. Yeah. So I guess the, the stupid simple question is, what is vision? Yeah.

Mark Abbott (00:00:50 -> 00:09:41)

So a vision is basically where you want to take things, right? So if you go on any journey, right? If you don't know where you're going, obviously you're going to end up, you know, somewhere. But is that where you want to end up? Right? So a vision, um, at its, at its simplest is where do you want to take this thing you're working on? So you have a, you know, you have a vision for like your career. You have a vision for where you want to take a, you know, a vacation. Uh, but if you're, if you, if you want to build a company, especially if you want to build a stage five company, which we talk about, right? Which is a company that someone would gladly, um, either buy from you or take over running for you, then ultimately you need to have a fairly clear and long-term vision about where you're going, because that will inform all the things that you need to start doing from this point forward. So, you know, then the question is, what should be inside of a vision, right? And so, um, you know, a vision should have a sense for a very strong sense, in my opinion, for what you're selling and who you're selling to as an example, right? And so, obviously what you're selling is a product and, or a service. And who you're selling to is called an ideal customer. You know, we call 'em ideal clients at 90, but, um, those are two pretty darn important things. But if your vision also includes like building a stage five company, now your vision also has to, uh, address the kind of people you wanna surround yourself with, um, the cultural stuff, right? Uh, and so, uh, most well developed visions include, um, a very explicit and resonant, hopefully coherent group of core values, right? These are the types of people that you wanna surround yourself with. Uh, so, you know, typical vision includes a sense of where you want to be, um, uh, as the stages of development evolve, and we can get into that in a second. Um, the, uh, the vision should start to extend, um, and as I said, a stage five company, it should be out five to 10 years. And we talked about why already. So we have the, we have your, um, where you would like to be in five to 10 years. We have a sense for your ideal customers. We have a, a sense for your products and services. Um, and then another, uh, component of vision is, uh, something we call unique value proposition. So what is it you're selling, right? Because lots of people have similar products and or services, but how do you differentiate yourself from others? Um, and how do you, uh, present your pros and source services to your ideal customers so that they resonate? Um, and, uh, so that's the unique value proposition, right? What is it you're selling? Some companies are selling lowest cost, some cus companies are selling something that's got great customer service. Some co companies are selling something about status like a, you know, a Rolex watch or a Gucci purse. And then, um, some companies are selling, uh, innovation, sort of cutting edge technology. Um, those are four of the classic sort of different unique value propositions that you'll see in across a lot of industries. Some industries don't have people competing along all four axes. Usually it's, you know, if you look at retail, you know, if you look at, okay, so you go to Walmart, it's lowest, lowest cost, you go to Amazon, it's, it's, it's selection and super fast, you know, delivery, um, of the product or that you're buying. Um, but those tend to be components in, in vision. The other one that you tend to see a lot, um, is, uh, a purpose, passion, or just cause. And the reason you see those in, um, in a lot of companies, a part of their vision is that you want to attract and retain, um, like-minded individuals back to culture. And so you want to attract and retain people who sort of are attracted to the things that you're attracted to in terms of how you make life better. So, you know, on the vision front, those are the big components. Uh, core values, products and services, ideal customer, your, um, how you make life better. And then the last, and then, and then back to that five to 10 year thing, it's like, okay, so what are your big hairy audacious goals? As Jim Collins would put it, we refer to them as your compelling audacious goals, right? Or the couple of big things that you'd like to be in five to 10 years. Um, so those are the elements of sort of your classic, uh, vision descriptions. You know, you see that, something like that in EOS, you'll see it in a lot of the other bos. But I think the thing that's important to note is that, um, you know, this is what we teach people, but the reality is, is that there are actually five sort of archetypes of entrepreneurs, and not all five of them actually start off with having a vision like we've just described, right? Um, there they're on the five archetypes, and we've got a blog about this, right? But the five archetypes are number one, the classic visionary, right? Who has this kind of a vision typically, that's just one of the archetypes. The next one are legacy entrepreneurs. And the difference between a legacy entrepreneur and a visionary entrepreneur is a visionary entrepreneur has this sense of where the world will be in five to 10 years and how they're gonna impact and be there and almost lead that transition, um, in terms of that product and or service, or even literally start a new industry. Whereas the legacy entrepreneurs, they're like the Hewletts and the Packard of the world. They're, there's this industry that already exists, and they're like, I think I can build a better company, um, and, and I can be the best in the industry. Uh, they're attracted to something that already exists. Uh, the founders of Boeing, you know, is a good example of that. And, and there are a lot of other great examples of legacy entrepreneurs. Uh, then we have our classic lifestyle entrepreneurs, which is the, in my sense, and we're gonna do the research on this one of these days, right? But I believe that most entrepreneurs are actually lifestyle entrepreneurs, and that is they don't wanna work for someone. Uh, they're smart and they have, you know, uh, a reasonable level of ambition, but, you know, they wanna do it their own way. And you see a lot of, uh, lifestyle entrepreneurs, you know, sort of people who own dentistry practices. You'll see it in marketing agencies. And, and so they, they may not have that five to 10 year vision. They're sort of like, I'm just gonna, right? I'm gonna provide a product and a service and you know, I'm gonna do it, I think in a reasonably reasonable way. I'm gonna price reasonable, you know, reasonably for the, for the product and or service that I sell. But they don't always have a five to 10 year vision. In fact, the legacy guys may not always have a five to 10 year vision. The visionary vision visionaries tend to have pretty long-term visions. So that's three. Um, the fourth one are accidental entrepreneurs. And, uh, most of those actually don't have a long-term vision. So when we talk about vision, we need to understand that not everybody right? Starts off actually having this really sort of coherent and, and explicit vision. And then the last of the, uh, archetypes are opportunistic and opportunists and, uh, you know, they just see an opportunity to make money. And it could be like, just gonna be a year game, or it could be it's a two year game. And so their vision, unlike this five to 10 year that I described earlier, their vision could be just literally, I'm gonna make a trade. I'm gonna do all this work. I'm gonna make a trade. I'm gonna make, you know, a lot of money, and then I'm gonna go try something else. So, uh, I just want to clarify that just because we talk about vision being these things, not everybody has that type of vision, um, or, or even has those components. But generally speaking, you know, we teach that those are, you know, sort of the core components, and we tend to call 'em focus filters because it helps you focus. Uh, this is particularly important for visionaries who are, tend to like chase shiny objects and, and, and, and, and wanna do a bunch of different things. And so this helps them focus, helps the company focus, right? Um, helps them avoid, uh, like I said, chasing shiny objects.

Cole Abbott (00:09:41 -> 00:10:02)

Yeah. So when it comes to, right, the visionaries, and then it sort of, obviously founder shapes the vision and the vision ends up shaping the founder. Yeah. But how does this division, you know, shape the company as a whole? Like, uh, how does that actualized at scale? Yeah.

Mark Abbott (00:10:03 -> 00:13:28)

So, uh, so many different ways, right? So let's just talk about core values, obviously, right? So it shapes the nature of the culture, right? So, um, it shapes the nature of the people that you, you know, hopefully, if you're pretty good at hiring and, and, and interviewing for, for core value fit, it shapes the nature of, uh, as I said, of, of the culture and of the employees. And so that's a pretty important thing. So that's how it partially shapes. Um, you know, not all people are gonna be attracted to, you know, all industries, right? There's certain industries that you're gonna just have an interest in. So obviously, you know, getting clear on your product and or service by definition means you're, you know, you're, you're putting yourself into a particular industry or niche, uh, um, that's gonna shape the kind of people that are attracted to the organization. Uh, the purpose, passion, and just cause is gonna shape, um, help shape the kind of people that are attracted to you, uh, your compelling and audacious goals, right? I, I like to say, you know, for those of people who don't like, see the value of like a compelling five or 10 year, um, um, big hairy, audacious goal, or a set of audacious goals, um, you know, I like to suggest to them that, hey, right, in order to attract and retain great people, they're gonna want to know that your vision's big enough for their vision for themselves, right? So that your dreams are big enough to be able to accommodate the dreams of the people who join your organization. So, once again, getting back to the type of talent you're attracting, if you don't have a five or a 10 year vision, it's not clear. It's just like, well, you know, we're just gonna, we're just gonna see what kind of, you know, we're just gonna try to increase the revenues by 5% next year. I'm just making that up, obviously. Um, that's gonna attract a different, you know, level of talent, um, than if all of a sudden it's like, oh, I can, I can see myself growing, I can see myself challenged, I can see myself, you know, developing, uh, in a manner that that's compatible with my level of ambition, right? So, um, and, you know, and then, and then back to, um, the unique value proposition. You know, some people, uh, are attracted to efficiency games, and some people are attracted to effectiveness games. And what I mean by that is, right, if you lowest cost producer, and you know, and, and that's like what you're all about, that's gonna be, you know, that's gonna attract a certain, uh, type of talent versus if you are more innovative and creative, right? And you're willing to try a bunch of stuff and fail, but like, but, but, you know, enjoy that, that, that, that type of, uh, learning process and experience, then you're gonna attract different types of people. So, um, the, the, you know, a really well articulated vision enables you to go out and find people that really match up well with who you are. There's a blog that I read, um, actually in the last couple of weeks that talked about culture market fit, not product market fit. And I think what I just described is culture market fit. Does that make sense? Yeah.

Cole Abbott (00:13:28 -> 00:13:47)

If you're doing a culture market fit, that's more of a, we talk about a brand centric approach versus a product centric approach, right? 'cause you're, you're going after the, the culture, the, the people that resonate with your vision, with your why and with everything. Yeah. As opposed to just really making sure each product is optimized for its specific niche and market. Yeah. And so, yeah,

Mark Abbott (00:13:47 -> 00:16:21)

And, and I, and I think, you know, <laugh>, I I have biases, you know this, right? And, uh, I'm not saying they're all right. Um, um, but they work for me. I'm comfortable living within my, you know, my biases suit, my suit of biases. And, um, and one of my biases is that, uh, I am far more attracted to market oriented businesses than product oriented businesses. And what I mean by that is that, you know, if you look at our company, at our core, we're about helping people build great organizations, right? Um, and in particular, we're actually a little more focused than that. We're about helping small and mid-size businesses and lead the leaders of those businesses built great organizations. And so that's a narrower thing, right? Um, and I'm even narrower than that because it's, I'm really about people who want to build a business that they could eventually either sell or hand off. And the reason I'm more about that is 'cause I actually think that's in the best interest of our economy and our country, right? That people play the longer game, right? And, um, going back to why I like markets versus products, per se, even though we have a product, is they're gonna be, in my opinion, I can't imagine a hundred years from now, there aren't people who build companies and run companies and scale companies. And so, as long as I'm focused on those people, our products and services can evolve, and they're gonna help us because if we build high trust relationships with them, they're gonna help us evolve and stay relevant, right? Because if we have a high trust relationship with them, they're, they're gonna want to help us, right? And so they're gonna tell us about, you know, the need for our product and or services to evolve, and we're gonna stay close and, and support one another as we evolve together. And so, you know, but if you're just selling the product, right? And to use the obvious one of, you know, a a whatever they call it a buggy whip, right? Or what was it called? A buggy whip? Yeah. Right? Sure. From like, you know, a hundred plus years ago,

Cole Abbott (00:16:21 -> 00:16:23)

That's what you're talking about. That's a thing. That was a thing, right?

Mark Abbott (00:16:24 -> 00:17:08)

Um, you know, the companies that made those, right? I don't think any of 'em exist maybe from, you know, from 150 years ago or 120 years ago, right? So, so there's just certain things. If you just, if you're just like, that's what I do, that's what I sell, um, someday that product may no longer make sense. Um, you know, obviously we can talk about, uh, you know, companies like Blockbuster, right? That product doesn't make sense anymore, or you call it a service. It was this product and a service really. But, but you know, the beauty of like Netflix versus Blockbuster is Netflix was, you know, evolved, right? And, and actually helped the industry evolve, but it stayed close to the customer.

Cole Abbott (00:17:09 -> 00:17:15)

Well, you didn't focus on serving the need as like, okay, you want video at home. Yeah. How do we best provide that service?

Mark Abbott (00:17:15 -> 00:17:20)

You want? Yeah. You want video based entertainment at home. Yeah. Right? So how do we evolve?

Cole Abbott (00:17:20 -> 00:17:21)

Yeah.

Mark Abbott (00:17:22 -> 00:17:58)

And so the other one, um, and I'm being old man when I talk about this, but is not as old as buggy whips. Yeah. Not as old as buggy whips. But the other one is, I remember, you know, in my old days, right? Lending and investing in businesses and someone brought us an opportunity to invest in a payphone company. Ha, that's a good one, right? And, uh, I turned that one down. Thank you. Um, but you know, that's a, right, that's a, if that's what you are, a payphone, a manufacturer of payphone companies, right? That's not a good long-term business.

Cole Abbott (00:17:58 -> 00:18:09)

But if you just want to, you know, like talk about the other types of entrepreneurs, you just want to sort of squeeze the juice for two years and yeah. Get out of it, or just, you know, really enjoy your life in the moment and set up something that works for that. Yeah. And that's,

Mark Abbott (00:18:09 -> 00:19:46)

Well, and that's, this is a great one. Um, because one of the deals that, um, I remember, I think we even invested in it, right? But it, the, uh, this private equity firm bought a company that did carbon paper. Now obviously e even back then, it was clear that that industry was gonna go away, but they bought it for such a low price that they could, you know, make a good investment on it, even if the e, even if all the carbon paper was basically being, you know, um, no longer used within three or four years, right? Um, now that's a good example of you don't need a five to 10 year vision, right? You needed a vision for like the next three years. And then, you know, and now, you know, the thing you had to deal with in a company like that is, well, how do you keep employees <laugh> when they know that the business is gonna go outta business within three years? Right? That's, so it's an interesting conversation, but I mean, that actually is, I think a pretty good example of you can have longer and shorter term visions, but it has implications on a whole host of things, including like, the types of people that you can attract and retain, right? The need for core values, the need for a bunch of different things. The, you know, purpose, passion, just cause well, right? Your just cause is to make a lot of money and, you know, so now you're right. You're gonna go find people that, like, that's everybody's, we're all in this together. We're just gonna milk this thing for three years and then, you know, then we're all gonna look for a new job.

Cole Abbott (00:19:48 -> 00:20:06)

So given the, I guess you could say different types, the temptations or whatever, different at things that are attractive, right? Different people, where do companies sort of tend to go wrong in creating and enacting their visions?

Mark Abbott (00:20:07 -> 00:20:10)

Well, um, as I said, we could spend hours talking about this stuff, right? We,

Cole Abbott (00:20:10 -> 00:20:11)

We do not have hours <laugh>. Yeah. So,

Mark Abbott (00:20:12 -> 00:22:38)

So you gotta, you gotta manage me on this one. But, um, so, and this will be another podcast, we'll get into agreements based cultures, right? Uh, but, you know, ultimately, you know, I think the, the slippery, some of the slippery slopes are your, you know, you have this list of focus filters, you have core values as an example, and then you don't walk the talk clearly, right? Um, so, you know, um, an, an example of that is one of your core values is team. And yet you have all these incentive plans that basically pit people against one another, right? So that's a, an example of, you know, um, an area where you can run into trouble with division stuff, um, you know, uh, your ideal customer, right? Basically you say your ideal customer has, you know, it's demographics, psychographics, and geographics, right? Um, and then, you know, you tell your whole marketing organization, right? This is who we want to go after. Um, everybody in the company knows this is who you, you really want to attract and retain. And yet the sales organization brings you a bunch of people that are clearly not ideal. And so those non-ideal customers, um, and let's just say it's like a lot of 'em, like, right? So all of a sudden it's like, well, you know, all of our customers are asking for X, right? Which is the lowest cost, right? But we say we're not the lowest cost provider, we're actually selling innovation. So your cu your customers are saying, I want X but your product people, your marketing people, right? Your, your and your and your customer service people are saying, but you're not bringing, that's not who we have, right? They're asking us to, to ma meet needs that are not aligned with what we say we are. So, you know, we don't sell ourselves this way, we don't market ourselves this way. Customer service wasn't set up this way. So that's another classic example of where, you know, you say one thing, but you behave in another, in another way. And at the risk of stating the obvious, it just hurts the credibility of the senior leadership team. Um, and almost always the credibility of the, of the founder, CEO.

Cole Abbott (00:22:38 -> 00:22:57)

Yeah. 'cause if you're flipping sort of what you're trying to do and why you're trying to do it, then yeah, you, it's hard to create any sense of trust within your Yeah. Market, obviously. Yeah. And it's also hard to, it takes time to build a product and, and work that you're way up through everything. And if you're switching on it repeatedly,

Mark Abbott (00:22:58 -> 00:22:58)

Yeah,

Cole Abbott (00:22:59 -> 00:23:00)

People are just gonna lose interest.

Mark Abbott (00:23:01 -> 00:25:05)

<laugh>. Well, it's trust once again, right? Yeah. It's, it's, it's, you know, trust the three dimensions, character, competency and connection. And so, you know, in some regards, you may be hammering yourself on all three, right? Okay. You say one thing, but you do another. That's a character thing, right? We've all learned how to be really competent at this thing, and yet we're being asked to do this thing. That's a competency thing, right? And then the whole connection thing is, you know, we, we've all been attracted to go out and out, just, you know, once again, another example, we've all been attracted to go out and find, uh, people who value what it is we're selling. And, um, and, and, and so on the connections front, uh, but we have all these people that, you know, are yelling at us as an example, yelling at our customer service people. And it's like, alright, this isn't who I want to serve. And, and, and, and, and, and support. And so, yeah, there's a lot of ways to, um, mess up if you're not genuine about the components of your, of your, of your vision, right? Your vision attracts and retains the talent. And, um, and if you can nail it and live it right, and you won't be perfect, none of us are. But if, you know, 90, 95% of the time, alright, 'cause, um, 'cause by the way, everything, every one of those things is an agreement, right? Our core values aren't an agreement. Our purpose, passion just causes an agreement. Our ideal customer is an agreement. Our, uh, you know, our unique value proposition is an agreement. And so when you know, you consistently live up to your agreements, it just makes it so much easier for you to thrive. And part of it is, it's just the compounding, right? The eighth wonder of the world according to Einstein, right? If we stay focused, call 'em focus filters, and we consistently like just improve, improve, improve, improve, then all of a sudden the next thing you know, you got a pretty damn good company. Yeah. It all starts, you know, inside. Yeah. It all starts with vision.