How to Go From Chief Everything Officer to Chief Executive Officer with James P. Friel: An EOFire Classic from 2020

0:01Boom! Shake the room, Fire Nation. JLD here and welcome to Entrepreneurs on Fire. Brought to you by the HubSpot. podcast network with great shows like duct tape marketing. Today we're pulling a timeless EO Fire episode from the archives so the giveaway may not be active and we'll be breaking down how to go from chief everything officer to chief executive officer. To drop these value bombs, I brought James P. Friel into EO Fire Studios. When businesses are ready to scale, they call James Friel. He's a secret weapon helping many of today's well-known entrepreneurs become successful CEOs. Breaking complex problems into small actionable steps is his superpower.

0:36In today's information, we'll talk about how a system is a combination of people, process, and tools. It needs to be coordinated to achieve an outcome and how to get into the habit and the mindset of being an effective CEO. Don't fall into the trap of being the aforementioned four types of bad bosses that we go over in the episode and so much more, Fire Nation. And a big thank you for sponsoring today's episode goes to James and our sponsors. Element is an electrolyte drink mix with everything you need and nothing you don't, try it totally risk-free today. Visit drinkelement.com slash EO Fire and get a free sample pack with any purchase.

1:10Plus a no questions asked money back guarantee. That's drinkelement.com slash EO Fire. Outbound Squad hosted by Jason Bay is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Tune in for convos with leading sales experts and top performing reps to help you land more meetings with your ideal clients. One of my faves, the monthly app with Jason and Ethan, where they share hacks, tips, and tricks. Listen to Outbound Squad wherever you get your podcasts. James, say what's up to Fire Nation and share something interesting about yourself that most people don't know.

1:50What's up, Fire Nation? Great to be here, JLD. So I think one of the things about me that most people probably wouldn't know unless you're my parents. My first big sale in my career was actually selling my swing set when I was like eight or nine years old. You're like, I'm done with this for sale. Yeah. Well, it was really funny because I was home alone and my neighbor came driving up our driveway and he knocked on the door. He's like, hey, are your parents here? I was like, no, they're not here. And I just figured the conversation would end. And we just kind of stood there and it was awkward for a minute.

2:24And he looked over at my swing set. He's like, oh, that's a really nice swing set. And I looked over at it and realizing exactly what you just said. I was like, well, do you want to buy it? And he said, really? I was like, yeah, sure. I was like, I'm not using it anymore. Why don't you make me an offer? And he - He's like, five bucks. I sold it for 75. Whoa. Yeah. He's like, all right, I'll take it. And I was like, perfect. So he goes driving down the road and my parents see the swing set hanging off the back of his truck. They're like, was that your swing set? I was like, yeah, I just sold it.

2:55Your parents are like, we spent$745 on that swing set. Exactly. Exactly. Well, Fire Nation, as I shared during the intro, we're going to be talking about how to go from chief everything officer to chief executive officer. And we have a lot of great ground to cover. And James, I actually want to start by talking about the genius paradox. Why do most people get stuck in their business? Yeah. Most people get stuck in their business because they're really good at something. And most people start a business because you have an idea for a product or a service or whatever it is. And you're good at that thing.

3:37And you start doing more of that thing and you create success. And it's almost like those Chinese handcuffs where you put both of your fingers in. Oh, yes. Right? The harder you pull, the harder it is to get out. And I think the better you are at your thing, the more success that you create. And what winds up happening, if you picture a pie, at first when you're starting, you're getting to do your thing 50, 60, 70, 80 % of the time. And the more success you create, the more other things that you create while you're doing that thing, right? You now have more customers, you have bills that need to be paid, people that are working for you potentially, all these different things.

4:24And so that percentage of the pie that you're working on your zone of genius, which is the catalyst for growth, starts shrinking and shrinking and shrinking. And sooner or later, you're like, man, I'm not even getting to do the thing that I'm good at, the thing that I love, the thing that I was so excited about when I first started this because there's all this other stuff. So it's almost, it's sort of this cruel joke. The better you are, the faster that success happens. And then that creates this whole new set of problems. It kind of reminds me of the book a little bit, E-Myth Revisited. And, you know, where they're just kind of like talking about how this person, oh, they love baking muffins.

5:01So they started a bakery and then they just realized like, huh, like I'm no longer doing anything to do with baking. Like I'm doing all the things, but, and that is kind of like potentially that issue that you're getting into. And I think that's really fascinating about the genius paradox too, is like, man, you're just really good at that thing. And you kind of get stuck doing that thing because you're so good at it. And like in your mind, a lot of entrepreneurs have this problem. Like we think like, oh, nobody else could do it. Like I could do it. And guess what? They might not be able to do it a 10 out of 10 if you're a quote unquote, a 10 out of 10.

5:31But if you can get somebody doing something like a seven or eight out of 10 that frees you up to do other things, to grow and expand your business and to actually fulfill your vision, that's something to definitely think about. Now, let's be honest. Systems are massive. I mean, we have built entrepreneurs on fire on the back of systems and automations. I mean, it has been critical for us. So why is our business growth limited to the fact that we'll never be able to exceed the capacity of our systems? It's a great question because I think that people generally are more excited about the result that they can create than the system.

6:11And I'm right there with you. I told you about selling my swing set. I love sales. I love working with customers and that sort of thing. And even though a lot of people know me as a systems guy, they think it must just be like, I just like wake up every morning and I'm like, oh my God, you know what I want to do today? I just want to build more systems. But what I really want to do is I want to grow my business. I want to grow my business. I want to have a life. I want to have the ability to work on the things that I find meaningful and important. But at the end of the day, I'm only one guy. And even if I have a team of people, we are only so many people.

6:51And each one of us has a limited amount of resources at our disposal. It doesn't matter who you are, whether you're a solopreneur or you're Jeff Bezos, at some point, there's a finite amount of resources that we all have to work with. And systems are the gateway to freedom. And the way that I like to explain it is systems give you leverage. And leverage is an incredibly important concept that I think a lot of people talk about, but is misunderstood. And I remember the first time I learned about leverage was not in the business context. My dad was a mechanic. And so he was always working on cars in the garage.

7:33And I went out to the garage one time and he was kind of under the hood doing something. And I asked him if he wanted any help. And he's like, yeah, just grab that wrench and take that bolt off of this, you know, part of the car. And I was like, okay. So I grabbed the wrench and I'm like, I'm pulling on it. And this thing just like, won't break. And I'm like, oh my God. So what's, what's my reaction? Pull harder. Right. So I'm pulling harder and he walks, you know, he walks away. So he doesn't see what I'm doing. I'm like standing on the engine of the car and I'm like pulling on this thing. And he comes back and he's like, what are you doing?

8:04I said, well, you wanted me to get this off, but I don't like, I'm not strong enough to get it off. and so he's like, hang on a sec. So he walks to the other side of the garage, grabs this three-foot length of pipe, puts the pipe over the handle of the wrench. He's like, here, grab the top part of this pipe. And I did and I pulled and the bolt immediately broke off. And that was the first time I was like, wait a second, I put less effort in and I got the result way easier, right? And systems are the leverage that we need in our business because we only have so much time in the day. We only have so many people on our team.

8:40We only have so many resources to use human capital and financial capital to do things that could be systemized is not the best use of resource. And so our business growth is ultimately bottlenecked by how effective our systems are. Fire Nation, I think it's so key to really recognize the fact that systems will give you leverage. They'll give you the ability to scale. And I love that visual that you gave James about the fact that, Hey, let's take a pipe on the end of this wrench. And then all of a sudden something I couldn't move five seconds before now, because of leverage, I'm able to do it and I'm able to do it fairly easy.

9:19Like it's, it's not super difficult. And so like whenever you're finding yourself being like, man, this is so difficult. Believe me, there's a better way. And, you know, a lot of times people ask me, they're like, John, like, how have you been able to build the business and the success that you've been able to achieve so far? And like, I'll answer with a straight face. I'll be like, I'm a tweaker. Like, I'm literally a tweaker. What I mean by that is every single time I do something, I'm typically just doing a little tweak, a little leverage, a little something, just a little twist that's just making that system a little bit better.

9:54But guess what? when I have made a hundred tweaks, you know, over a hundred days, like that compound effect has been massive. And so like, I am always tweaking things. I'm always adjusting. I'm always looking for that, that system that's going to give me that leverage, that ability to scale. Now, when a lot of people think of leverage and scale and freedom, James, they think, wow, well, I just need to hire people because hiring people will make things easier. It will make things better. Is hiring a team going to do that for sure? It's not a certainty. There is absolute value in having a team. I totally believe that.

10:31But I also think that unless you're setting up systems, then your team is just a drain on you, or it could be a drain on you. It's expensive to have people and it takes time to manage those people. And so I think a lot of times when people run into bottlenecks, they say, oh, well, just throw money at it and hire somebody. And more often than not, that doesn't really fix the problem because you never got to the root of the problem. And if hiring people is always the solution, then you really haven't dug deep enough. And it kind of brings me to the point that I want to make about what really is the system, right?

11:13We throw this word out a lot and people say, oh, you got to systemize things and just create a system. And it's kind of become a buzzword. And I'm glad that there's awareness around it. But the definition is critical. And back when I left my corporate job nine years ago, I was running my first agency. And I had a lot of sales and marketing success, but delivery and keeping everything on track was a total mess. And I just thought maybe I should just hire people. And so I had this revolving door in my business, for a year and a half where it would be like one person after the next, after the next, and it just wasn't working.

11:51I was like, man, what am I doing wrong here? And I zoomed out and created a definition of a system that has helped me ever since. And a system is a combination of people and processes and tools. And all three of those things need to be coordinated in helping you achieve a certain outcome. And so if you're hiring people and plugging them in to a system where there's processes and tools to help them get their job done, people do the thing, processes help them know what to do, and the tools support them in that effort, then hiring people is a great idea. But if you're just going to throw people at a problem, then you're going to have a much bigger mess.

12:33And it reminds me of a story, and you and I are both good friends with Russell Brunson. And Russell's been a client of mine, and I helped him put systems in place in his business. But one of the stories that he shares is in his early days, he had a team of six, seven, eight people, and they'd just be sitting around while Russell did all the work. And it's like, man, if your team is just sitting around while you do all the work, that means that you haven't fully integrated them into a system. And really, it's just costing you money. So the right way to think about hiring people is how do you plug them into that system that is a combination of people, process, and tools all trying to achieve a similar outcome.

13:14See, I love that. I just want to repeat that one more time, Fire Nation, that a system is a combination of people and processes and tools all trying to achieve an outcome. Like that is just such a great way to look at that process, to look at what a real system will do, a profitable system will do for you. Now, Fire Nation, if you even think we're close to done dropping value bombs, you have another thing coming. We're going to break down the four types of bad bosses and so much more as soon as we get back from thanking our sponsors. Hydration is key. Whether you're intermittent fasting or getting your sweat on in the gym every day, muscle cramps, headaches, and fatigue can set in fast due to electrolyte and sodium deficiency.

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14:31And right now you can try Element totally risk-free. If you don't like it, Element will give your money back. No questions asked. Visit drinkelement.com slash eofire today and get a free sample pack with any purchase. That's drinkelement.com slash eofire. Content is a major driver of traffic and leads in most businesses, but creating great content takes a lot of time and people. That's why AI is making major headlines these days and HubSpot's AI-powered content assistant is coming in hot. HubSpot's AI-powered content assistant helps marketers brainstorm, create, and share content quickly and easily.

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15:42Get early access to HubSpot AI today at hubspot.com slash artificial dash intelligence. So James, we're back and there are not one, not two, not three, but four types of bad bosses. Let's break each one of those bad bosses down one by one. It's important to recognize this because I think we've all probably, as I'm going to talk about, we've all seen ourselves become these types of people in one shape or form. And having awareness around this and what to do about it is the thing that can help really drive growth when we have the systems in place and we're managing a team. We don't want to show up as these four.

16:22And so the first one is what I call the hypercritical boss. Okay, this is the person who needs to be right all the time. They're kind of judgmental of other people's contributions or opinions. Nothing's really ever good enough. They tend to think they could have done things better themselves. They're sort of like driven by anger. Maybe it's outward. Maybe it's passive aggressive, whatever. And their team is not really empowered, but they're sort of dependent on this person for solutions. And that ultimately stumps growth. And so the team doesn't grow because they're always worried about this person who's hypercritical.

16:58And so that's on one side. And then on the other side, you have sort of the opposite person who is the people pleaser. And this is the person who really, really wants to be liked by their team. It's super important that everybody thinks they're a good person. They want to keep the peace and avoid conflict and difficult conversations and potentially even have self-sacrifice in order to avoid that conflict. And even though they tend to think they could do things better themselves, they just volunteer to take on more because they're trying to make sure everybody likes them. And so they wind up having resentment towards their team because they're doing their team's job and they're not really addressing the issue.

17:40And this leads them to feel like they're a victim and wishing that things were different, but they're unwilling to make a change. And so you've got sort of these two on one spectrum. And then on the other spectrum, we kind of have this concept of presence, like am I more present or less present? So being too present is the helicopter boss. And this is the person who's constantly hovering over the team, worried that everything's going to fall apart if they're not involved. They're the dominating micromanager. They do everything themselves because they don't trust other people to do things correctly.

18:13And they're driven by fear of losing control. And then the opposite of that person is the absentee. And we've seen these people plenty of times as well. They're bothered when their team needs them. And they think that what their team is doing is beneath them. And they just kind of want their team to figure things out on their own because they think most things aren't worth their time. In many cases, they're likely to grant premature ownership of tasks and responsibilities because they don't want to be involved. And they're driven by the fear of missing out on other more important things. And so, you know, there's these two spectrums that we all can fall on.

18:49And our goal is to recognize these tendencies that we have and how we show up as leaders and managers and to bring things towards the center to this concept of what I call being an engaged leader who is, you know, showing up, giving feedback, willing to have the difficult conversations, giving the right authority and autonomy to people and being engaged when is necessary. And so it's really important that we recognize that it's not your fault if you're showing up like this. But once you have this awareness, how can you become an engaged leader instead of showing up like one of those four types?

19:26Now, let me put you on the spot here. Which one of these four is your least favorite type of a bad boss? My least favorite type is probably the absentee. because I'm like, man, if you have a business, roll up your sleeves and be the business owner, be an engaged leader. And I think it's hard to do that if you just feel like everything is out there and not really supposed to be requiring you at any level. And which is the one that you think is probably the easiest to make an adjustment and become a good boss, even though right now you might quote unquote be a bad boss? I think that with the right delegation systems in place, it's way better.

20:09And I think it's easier to go from being the helicopter person who's like always micromanaging things. Hovering everywhere. Yeah. Totally. Nobody likes to work like that. It's exhausting for everybody. and with systems, people, process, tools, but then delegating things like who's going to do it, when's it going to get done, what exactly needs to be done and making sure that you have feedback loops on those systems, I think it is easy to move away from being that helicopter boss, which nobody really likes. And it's empowering too to your employees and the people on your team, Fire Nation, when you're just like, you know what?

20:43This is what I want you to do. Now you go do it and you figure out how to do it and I'd love for you to come up with a better way than maybe I'm showing you right now. But like at the end of the day, this is your job. Come back, take control, take power, take ownership. This is yours. You're empowering these individuals now to go out, take responsibility. Now they have pride in this thing, Fire Nation. When someone has pride in something, man, they do not want to screw up. Like they want to be proud of something worth being proud of. Now, if we really wanted to break it down to the core, because we hear the word hustle all the time.

21:18I mean, we said Russell Brunson's name a few times. People look and they see that he seems like he's always hustling around, like he's doing Instagram stories, live speeches from stages, webinars, writing books, doing all this jazz. What's the difference between a hustling entrepreneur, somebody who's just hustling, and an effective CEO? This is such an important topic because I think that there is a big difference, but it's not immediately clear on the outside, right? Because I'm not saying that you're going to achieve success without putting work in, because it takes work to build systems, to build a team, to build a business that's valuable.

21:58But I think the key distinction between a hustling entrepreneur and an effective CEO is that a hustling entrepreneur, if you look at them today, they're going to be grinding today. But you look at them a year from now, they're going to be grinding on a very similar problem. A quote that I really like is, don't ever be working on the same problem a year from now. You could be working on a worse problem, a better problem, a different problem, but don't make it the same one. And I think a hustling entrepreneur is somebody who's just waking up, going through the grind, doing the same thing day in, day out, and they're not creating any foundation for themselves to stand on.

22:36And contrast that with an effective CEO. an effective CEO is somebody who recognizes that if you're building a business that's going to be an empire, right? And you have ambition to build something of significance and substance, then that empire is built on the bricks of systems, right? You constantly need to be replacing yourself and other people with these systems. And so part of your job as an effective CEO is what systems need to be built so that 30 days, 60 days, 90 days, a year from now, we're not working on the same problems. We've solved those problems and now we've moved on to bigger and better things, whereas the hustling entrepreneurs are still going to be working on the same things a year from now.

23:24Fire Nation, if you really break it down to brass tacks, the level of your success is the level of your problems. I mean, if you're working on low-level problems today and you're still doing that a year from now, then your level of success will not have ratcheted up at all. But if you're working on really big problems a year from now, because listen, you've continued to hire out and delegate and make systems and scaling and leveraging, you're going to be having higher level problems because you're having higher level success. So always think of that when you're going forward and building out your empire.

24:00So James, we've talked about a lot of awesome stuff today. what is one key thing that you really want to make sure Fire Nation gets from everything that we've talked about? Then give us the best way that we can find out more about you, learn more from you, give us that call to action, and then we'll say goodbye. Absolutely. So I say the one key thing is using that definition of a system, people, process, and tools, figure out what is the first brick that you need to systemize in your business, Is it you need to figure out somebody to help you with your content distribution? You need to figure out somebody to help you with your hiring, your onboarding, your customer onboarding, whatever it is.

24:39Start getting in the habit and the mindset of being that effective CEO. Don't fall into the trap of being those four bad bosses that we talked about. Be an engaged leader and an effective CEO who starts building your empire on the bricks of those systems. That's the one big thing. Maybe there were a couple of things in there. but that I would share. And so we've prepared something super special for you guys. And I'm very, very happy to share that with you guys. So it's a whole audit, basically. It's a series of worksheets that lets you go through your entire business and see where you're at. We've got a framework that I didn't get a chance to go into today called our RYG framework that will enable you to see where are your systems in your business, which ones should you be focusing on first, and then how to build those.