Ep. 608 - FAN FAVORITE | YPO President and COO Sean Magennis - Lead With a Servant's Heart

0:02All right, if you're an entrepreneur, you've got to go check out the Genius Network. The Genius Network is for ambitious, giving entrepreneurs who want to be part of the highest level connection group. And it's not just another mastermind. In fact, I have been a Genius Network member for eight years. Genius Network helps build a better entrepreneur by focusing on health, wealth, and making your business and life more ELF, which stands for easy, lucrative, and fun. Don't apply if you're just a taker, but do apply if you're a giving entrepreneur and you earn at least a million dollars or more in revenue.

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0:49You and I both know as CEOs, as presidents of organizations, we not only bring our business responsibilities and accountabilities to the table, We bring our personal lives to the table. We're doing our own desires. We know that a lot of our members, once they've achieved a certain amount of success, they want to give back or they want to impact their community. They want to do something that's socially good. We're really good with our defined constituent group, and we really help them and provide opportunities for access to learning, to each other, to great thought leadership, to great institutional relationships with universities and thought leadership around the world.

1:25we can collaborate across a variety of different ecosystems to really help make the world a better place at the end of the day. Business makes the world go round. We all know that. All comes down to business hiring, whether it's in the for-profit business sector or the non-for-profit business sector.

1:45Welcome to the Second in Command podcast, produced by the COO Alliance and brought to you by its founder, Cameron Herold. In the Second in Command podcast, we talk to top COOs who share the insights, strategies, and tactics that made them the chief behind the chief. And now, here's your host, Cameron Herold. Sean Majenis is the president and chief operating officer of YPO, the Young Presidents Organization. YPO is a global community of chief executives dedicated to becoming better leaders through lifelong learning and idea exchange. He began his business career in management in South Africa with Farmag Limited and Dow Limited, now one of the country's largest producers of agricultural chemicals.

2:30After moving to Canada in 1990, he founded an organizational development consulting and human resources business, as well as an executive search business with Brutu and Compass operations in Canada, the USA, and Mexico, serving thousands of clients. Sean is the past international chairman of the Entrepreneurs' Organization, EO, and he played a key role in EO's North American and global expansion for over 16 years. He's also been a goodwill ambassador in discussions with various government agencies, including the State Department. He's also an active member and past chair of the YPO Dallas chapter.

3:04And Sean and I were on a global committee, gosh, a long time ago, probably 20 years ago now for EO on a forum. So Sean, welcome to the Second in Command podcast. Thanks very much, Kevin. Great to be here with You were chairing this forum committee for EO and we were sitting down and debating. I remember at the time, I think we were talking about spousal forums as being this new initiative and everyone was really wondering whether it was going to be a good initiative or not. Lots of good debate. But you've been playing this kind of role where you've been largely involved in running nonprofits or businesses other than yourselves for a long time.

3:41How did you, I guess, balance that with running your own companies and also maybe just give us a little primer on what YPO is as well? Absolutely. Well, you know, it has been a fascinating journey. And I came to the volunteer world and the nonprofit world very early. I was very fortunate. And I know you have been too. Very early in my career, I just qualified my company for EO, just reached the million dollar sales mark. And it had taken me about three and a half years to get there. I bootstrapped it all on my own, no debt, no borrowings, literally sale by sale, at night generating invoices, borrowing.

4:17You know, in those days, we didn't have laptops. I had a big clunky IBM computer that you virtually needed a freight train to bring into the office. But one of the things I learned in that journey, and I was introduced to EO through a group of YPO members, was and immediately got told that I was going to volunteer to help run, and on an unpaid basis, a peer group of young entrepreneurs that were building their businesses, grinding it out with the same struggles. I got so much, Cameron, out of that experience because being in a group of individuals who were going through almost the identical pains, whether it was factoring your payroll or collections, your marketing, hiring your first employee, your second, your third, moving into a new market, you know, moving into a new country.

5:10All of those things, having never done them before, you can read them all, business school teachers, all of these various things to you from a more of an academic perspective. Living through it is a different matter. And so having the alignment with this group of volunteers, really, I became addicted to volunteering. And so once my business had qualified for YPO at the time, YPO's qualifications were about$10 million in annual sales. and I'd run through 16 years of EO, it was a natural progression for me. And for over 23 years now, volunteering for the nonprofit peer group has just been a central, pivotal contributor to my own personal success, personal learnings.

5:58I met my wife, Faliya, through EO, and she was the daughter of a white EO, the single greatest benefit that I've received. But, you know, to put it back in the context of YPO, for the last five years, I've been a YPO member since 2007. For the last five years, I've been on the management team of YPO. Two YPOs that run it. We have a CEO who's a 26, 27-year YPO member, and myself as his number two. We have a very active volunteer board of 17 highly successful CEOs. And then we have a governance structure in the organization of about 150 members from around the world. YPO today, we're over 27 ,600 members in 135 countries, 460 chapters.

6:43We have over 17 million employees across the membership companies. It's incredible. Yeah, and we're closing on$9 trillion in member company sales. So it's become a significant business. and even though it's a non-profit with a strong focus on providing learning and a platform for members to interact with each other within this what we call our safe haven when you put members together it's a highly personalized highly confidential environment that we create for them yeah and so it's become a fairly complex but extremely extremely exciting organization to be a part of from the inside you know so i have the benefit of having been the recipient of member value and services now, you know, having the privilege of at an inflection point, 68-year-old organization where we now have to be relevant in the 21st century with all of the things that your CEOs and your audience are facing, massive disruption, tech disruption, digitalization, fourth industrial revolution going on, you know, continuous globalization.

7:52I mean, how do you create a culture where you've got the underpinnings both on process efficiency all of your back office and yet you're not leaving your customer behind because the customer is the most important thing and you guys are not as you just pointed out with some of the numbers you're not running a small organization like 27 600 members worldwide 135 countries the world right now is littered with mastermind groups for entrepreneurs you know there's just dozens and dozens of these groups of entrepreneurs and when YPO is clearly the highest level and you're not just the entrepreneur you you also do the the hired gun president or ceo you're kind of the top person in organizations how do you get these people the men and women who are members of YPO globally and I have a client who's in YPO in Thailand and he said his chapter accounts for 37 percent of the GDP of the country Yes.

8:44Like you're dealing with the real player, real company CEOs. How do you get them to come and join an organization like this and be vulnerable? How do you teach CEOs at this level to be vulnerable and open and willing to learn? The key for us is we do it through member to member interaction or member to prospect interaction. The key for us is if built into the DNA of the organization is the spirit of volunteering and the spirit of openness and humility. A lot of it stems from the work that comes out of the Forum product that you were speaking about when we first started speaking. Forum was something that YPO introduced 46 years ago now, which is really a very intimate gathering of 10 to 12 members from non-competing companies to get together once a month for four or five hours.

9:36and it's a highly scripted, moderated experience where you have one of the members actually leads and moderates the group. You get trained to do that. And the purpose of Forum is so that you can bring your entire self into the Forum. Nothing that gets discussed in the Forum is allowed to be disclosed to anybody outside the Forum. If you disclose that, you're invited to lead the Forum. And that's very rigidly maintained. What happens is after a period of time, you as an individual forum participant bring all of your issues to the table. It starts out business and you get business issues solved.

10:14You're not allowed to give advice in forum. You speak from experience. And that's one of the key drivers that I'll anchor in on a moment is that YPO members get trained to speak from experience, which is very different to advice giving. So somebody that's been through, let's just say a business failure, a massive business failure, where there was a bankruptcy or there was a massive turnaround or the individual had to put a month's payroll on their credit card or mortgage their property. And then how they got out of that, how they solved that business problem, all of those things get disclosed very personally, very truthfully within forum because there's a guarantee that what gets said in that room stays in the room.

10:54So that authenticity, that sort of humility, that egoless ability to safely share what's happening in your life, that starts to permeate through the whole organization. You will hear members say, I'd like you to hold this conversation that we're having under the guidelines of forum confidentiality. Those on the inside is, I'm telling it like it is, and I expect you to hold that in confidence. And so it's not a legally binding framework, but it's part of the DNA of the organization. So when we go out and attract members, prospective members, we very often lead with the concept of what would it be like if you were to meet with another group of very successful CEOs, the same age as you, younger than you, older than you.

11:43And what if you were able to learn all the lessons that that individual had learned in their business career and in their personal lives in a manner that's truly authentic, that's based on trust, that's factual, and that's real, and you're getting it from the person that lived through that, would that be a useful experience for you or opportunity for you? I have very seldom had a qualifying prospect say no to that invitation. Yeah, that invitation is huge. Powerful, isn't it? Yeah, it's funny. I'm sitting you're listening to and going, wow, yeah, of course, like just sign you up, right? Yeah. And then it's also about the whole person.

12:21So we know, you and I both know as CEOs, as presidents of organizations, that we not only bring our business responsibilities and accountabilities to the table, we bring our personal lives to the table. We're doing our own desires. One of the things that we've migrated to IPO over the years is we know that a lot of our members, once they've achieved a certain amount of success, they want to give back or they want to impact their community. They want to do something that's socially good. They want to change the world in some positive way. And so we also now provide a platform for those of our members who want to have a significant impact outside of the pure sort of profit generation desires when you first get into a business.

13:05More and more of our members, Cameron, are playing multiple roles, whether it's giving back in their community, leading in politics, impacting through some technology or through philanthropic giving and really starting to have an impact on the world. And so I'll talk a little bit about the strategy and the evolution of where the organization is going and how we need to provide in an ecosystem. And I use the word ecosystem because we don't feel we need to own the peer-to-peer space. We're really good with our defined constituent group, and we really help them and provide opportunities for access to learning, to each other, to great thought leadership to great institutional relationships with universities and thought leadership around the world, create a place for young children and spouses to work within this and collaborate together.

13:55We can collaborate, you know, across a variety of different ecosystems to really help make the world a better place at the end of the day. For sure. And business makes the world go round. We all know that, right? All comes down to business hiring, you know, whether it's in the for-profit business sector or the non-for-profit business sector. Well, I'm curious how you're taking some of the skills and lessons that YPO has really ingrained in building the forum experience and the chapter experiences. What tools do you take from the forum kind of experience or the YPO membership experience and bring into your business?

14:31Do you take that confidentiality in? Do you take the bringing your whole self in? What do you bring in and how do you bring those in? In fact, we have a product in YPO called Forum in Business. And, you know, part of that is taking some of the key tenets of forum, transparency, honesty, authenticity, parking your ego, equality. Part of forum is the process of forum because you're talking from experience, not from advice giving is suspending judgment. And even if you just follow the basic principles of listen before responding, really assess your own, you know, how are you feeling? Is the hair going back?

15:08You know, you're sitting in a business meeting. it's been a tough quarter, you're looking to blame or you're expecting somebody to blame things on you. The forum principles teach you to kind of sit back, breathe, listen, evaluate utilizing data and fact, not jump in with a defensive comment or a critical comment. It really helps you suspend some of those basic things that are, by the way, natural human reactions. Yeah. These are just physiological reactions, but the discipline of the forum techniques helps you identify what those are and then helps you as an individual, and I'll use my experience, it's helped me tremendously partition the physiological reaction from what is the reality, what am I hearing, how does that play to the data that I have at hand.

15:59So building those structures and those disciplines, very powerful in all the way. So do you take those tools and those structures and teach them to your employees? And if you do teach them to your employees, how do you teach them so they understand that same experience? Because I think that's where it can be really powerful, can't it? Yeah, so it's done in different ways. At YPO or iEmployee Group, every single employee as part of the orientation gets trained in how to participate in a forum. Okay. So they go through the full training that a member would go through, and they experience that in a small group.

16:29Now, they're not a YPO forum, so, you know, it's because the YPO forum is a true peer-to-peer forum. Yeah. In an organization, what you want to do is tease out those applicable principles because you're not in a peer group. You may have a supervisor with a subordinate in a matrix organization with another member of a different team. But as long as the principal foundations are adhered to in terms of how you structure a meeting, what you discuss in a meeting, how you discuss, the timekeeping, the recordkeeping, the speak from experience, the use of data and fact, suspending critique and judgment, those foundational things work perfectly within the constructs of managing a business.

17:09Yeah, it's funny. I just started listening to some of what you're saying. I thinking to the book that I wrote, Meeting Suck, and how much of what I pulled from forum, I actually pulled into the meeting structures almost by osmosis. I was thinking about the moderator, the timekeeper in the parking lot, and those are right out of the forum experience. Right out of the forum experience. And really at the outset, so much of business today, you know, the best CEOs that I've met, and I've met like you thousands and thousands and thousands over the last 24 years. The best CEOs are the ones that can clearly articulate their values, their own personal values, you know, show up as authentic human beings, human first, business second, you know, operative second.

17:52And within Forum, that foundational principle of sharing your values, your hopes, your dreams, some of your frailties, and even for CEOs, obviously there's a boundary and there's a line and you're not going to share with your employees that you've got terminal cancer when you're leading a publicly traded company without informing your shareholders first and having all the risk mitigation strategies involved. But if you can clearly commit to sharing your values in a way that says, here's who I am, and I care for you at the human level, step one. Massive. Massive, right? You know, because that, I mean, we spend so much time together in an organization.

18:31That has to be a core first step. I led a session at the COO Alliance event. I run kind of the only network of its kind in the world for the second in command. And I had a session that was very impromptu about a year ago where I was going through a really tough day, Frank. I was looking at the group and I thought to myself, you know what, I'll bet you every single person in the room is struggling with something right now as well. So I had everybody write down one thing they were deeply struggling with on a post-it note. And we all passed around the post-it notes and shuffled them up and read them out loud.

18:58And man, it was powerful to see 30 different people in tears when they realized how much everybody else was struggling. And I think that's just part of the human condition that every employee is showing up with the same shit we are, right? Yes. And, you know, Cameron, in today's world, we have employees whose families are employees here in the United States whose families are living in emerging market countries where there's civil war. So they're carrying their accountability load within the organization and obviously expectations, etc. We all have lives in the background. So those forum constructs enable you to understand that first and foremost, you're dealing with a human being.

19:36The second aspect of forum, which is so profound and so pertinent to business, is 100 % commitment, 100 % commitment to your obligations that you sign up for in joining a forum. Now, my forum, I'm allowed to miss two meetings a year. We're an older group. People have traveled, have homes around different parts of the world. And so in the business context, when you're working in teams, the commitment is 100 % commitment to show up to each other. Foundational, right? Interesting. Then you've got the protocols. So then you've got the speaking protocols. You know, when you speak, it's got to be from a factual database foundation.

20:14How many businesses do you and I know where it's a lot of knee jerk, shining new balls, you sweep the reality under the carpet, the best businesses, define process, utilization of data. Obviously, you don't want that to kill creativity. You still want creativity and innovation. you want to fail fast, but you want to have this culture of, come on, let's go for it. Let's transform. And let's do that continuously. You still need the underpinnings. I was talking yesterday to somebody about the underpinnings of a business changing. And I was saying that we've evolved like in a business, a business evolves like a human evolves.

20:50So when you were four years old and when you were 14, and when you were 24 and 34 and 44, you were still Sean Maginus, but you were a very different version of yourself. Of course. How do you think a company has to evolve and how have you worked to evolve companies as they grow and as they kind of go through the teenage, adolescent, adult phases? What needs to change? You take an organization that's 68 years old that started out really more of as an association model. And as it grew, so it started. So the demographics got older. The average age of total membership today is 50 years old. But in order to get into YPO, you have to be under 45.

21:33We recruit most of our members in the age of about 35 to 42. So the average age of a new recruit is closer to 40. But because we have a whole group of individuals that's over 50 years old and growing because we have a very high retention rate, in our industry, we have a 94, 95 plus percent retention rate, which is every business would give their right to run. Die for that, sure. Die for that, right? So it's meant that during certain phases of the business's growth and development that you have to really take a very close look. Firstly, you've got to position yourself and you've got to really understand your business comparatively to the market.

22:13And obviously, there are a number of key drivers there. Are you getting year-on-year growth? Is your growth stagnated? What is your demographic? Is there any price sensitivity to the pricing points for your product or your service? There's a whole series of business metrics. And then obviously you've got competitors or comparatives that you can go in and compare to. In our sphere, we follow about 110 companies, not necessarily just strictly core competitors, but more and more we're following online communities. We're following virtual communities. Wow. We have a whole team, Cameron, that's looking at, you know, and really listening to our membership, right?

22:54So we've, in the last year and a half, we've spent a lot of time listening to, holding focus groups with the millennial population. And then the next group that's coming up, part of it is how do you remain relevant? We know from the older demographic what's important to them. And we know that there's a lot of stickiness there because people that have come through our ranks and who've had a great experience with us, our fees are relatively low. they know how to extract value from the products and services that we put together. The other part of the question is what changes in the fundamentals? I don't think the fundamentals change that much.

23:31I think what changes is the environment in which your business is operating, whether it's the economic environment, the global environment, the different things that are happening, the stresses that are out there. The fundamentals, if you look at any business, and I'll say this with a high of confidence because I've seen a lot of businesses. I've seen turnarounds. I've seen, I spend a lot of time with a variety of different company CEOs, as you know. And the foundation elements of getting process right, communication right, transparency, clearly understanding and setting a vision and a purpose and a mission and aligning your whole team towards those, those constructs.

24:11They stay. I think they stay. Yeah. It's just the nuances. And then the most critical thing which doesn't change, which will never change in a business, is that every business is heavily reliant on every single person in a business. Do those foundational pieces that you listed off, do they stay consistent in all of those 135 countries as well, or most of, or does it change in any, are there any countries that you're doing business in where those things just don't work, or there's something different? I think there are absolutely cultural nuances, right i mean every country has a slightly different cultural nuances but the foundational business practices if you look at what we learned from japan when japan taught us the quality parameters after the second world war you know we went in and there was the marshall plan and we did all this rebuilding let's say we were giving all our ip but look at what's coming look what came back to us from japan yeah look at what's coming back to us from china it's incredible even though There seems to be this prejudicial conversation or very highly loaded conversation.

25:16And I'm not going to take sides in this one because that could take us three years to decipher, right? But once the foundation is set and people expect quality, people expect on time, people want what they want. And they'll, particularly in an environment that's not socialist or communist, they vote with their pocketbook. The one thing I noticed, I was talking to a YPO in Kenya, and he was talking about what's important to employees and what a company needs to focus on is different in North America or in Kenya and that region of Africa versus North America. I said, well, in what way? He said, our employees are going home and we're not ever sure if they're able to feed their family.

25:53That's a big one. And he said, North Americans don't really think about that. They're all trying to give their employees a better workplace and a foosball table and free massages and alignment with core purpose. And he goes, I'm not sure that my families are being fed. And then he said, we started to realize that if we paid the men more money, the assumption was the money was going home to the families and it wasn't. So what we started to do is at the end of the day, we gave them the male who was working food to bring physical food home to the family because we knew they couldn't spend the food at a bar.

26:22And it was just interesting to see that kind of a cultural shift. Do you pick up any of those things culturally or have you picked up any cultural things that are happening globally and brought them back into your business? We do. We have 360 full-time employees spread around the world. 75 % of our employees are women, by the way, and 50 % of YC Suite are women and very diverse, diverse cultures. So, you know, in certain parts of the world in which we operate, we need to make sure that our employees can actually get safely from their home to the workplace and back again. Yeah. We don't think about that in all of a sudden.

26:58We all jumped in our cars here in Dallas and we head home and we operate in certain cultures where they are still very male dominated. Yeah. And where we stand for equality and we stand for full diversity across all the diversity spectrums, not just gender. and we plant a stake and we say we're going to have members that are representative of every community in the world. We have to take into consideration and be patient and work through without sacrificing our stand and being in integrity with our stand. We have to work with the rules that we give them. And I don't think there's a culture or a business that we can't learn something from.

27:36If we stop learning and experimenting, then I think this grand, incredible societal world. Before we continue, today's episode is supported by our trusted gold partner, Redirect Health. If you've ever felt like you're overspending on healthcare and your employees can't even afford to use it, then listen up. Redirect Health offers healthcare benefits that finally make health insurance optional. It's a 24-hour online primary care and Rx membership that protects your business by guiding employees before problems happen. That means you're not overpaying for coverage that you don't need. It's like your mom is your doctor.

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28:42that we live in grindstone. What do you think your biggest skills are as a COO or as a leader? You know, it's changed over time. A good executive is constantly learning. I think as a COO, I think the important thing that I've learned is one, particularly also in an organization like YPO, you've got to learn to park your ego at the door. What doesn't work in a peer group or in a relationship between a CEO and a COO is having either both of you or one of you allow your ego to get in the way. So ego management, so difficult to do. And that's something, you know, that certainly I've tried to work on a lot better at.

29:24Coaching, coordination, I think are fundamental 21st century skill sets for a CEO today and a COO. You've got to be able to direct and coach and influence without direct accountability. responsibility particularly as your organization gets bigger right when you're a sole practitioner or you've got five or ten employees and you're still sort of able to roll up your sleeves and do most of it it's more hands-on you've got to be able to think more strategically and become a dot connector and then problem solving you know and that comes with experience i am way more capable cameron today at 54 years old in solving problems because i've seen so many problems one thing to apply intellect.

30:09And when you're dealing with human nature, when you're dealing with problems that are not necessarily financial or technical, that are more nuanced, that require patience, that require negotiation, that require bringing disparate group of stakeholders together, vendor negotiations today require a huge degree of skillset. All of those nuances require CEOs to upskill on a consistent basis. It's interesting. You're talking about all the soft skills that in some ways I used to take for granted. I was really exposed to a lot of this stuff at College Pro Painters years ago when I was with College Pro and opening up the West Coast of College Pro.

30:44And we really worked hard at growing our people. I remember Greg Clark, the founder, and Greg used to say that the leader's job is to grow people. And he obsessed about how can we grow our people? How can we grow our people? What you're talking about now, I think, is even infinitely more important than it used to be because the speed of business is faster. Business is so fast now that I think the soft skills leadership is probably more important than it's ever been. How are you growing your team at YPO and how have you grown it in past companies you've run? The key thing, obviously, is to have a very defined talent and career path.

31:17When a person comes in, obviously, they come in with a baseline. They come in with the experiences that they have, the skill sets, the resumes, and they're in a particular role with a particular set of objectives. From a developmental standpoint, it's very important to understand what they come in with. And then also to understand very early on what their desires are for future contribution, because everybody comes in knowing that they have to do X, Y, and Z, and they get their two-year plan, they get their team. But it's very important to transparently understand, to collect and gather where an individual is, what they personally want to do in the construct of your organization, and then even further, and then to create the conditions for that.

31:57One of the struggles that I've had in this business and in previous businesses is when you have relatively flat organization where there's not a lot of room to move. Yeah. How do you keep a person stimulated, rewarded, and growing where, you know, they may hit the ceiling and there may not be a role for them elsewhere in the organization within a three to four year time. And so the key is to maximize that time that they're with you. Okay. So you're touching on something that I've been trying to wrap my head around recently, And it's the second half of the Gen Y cohort. So really, we're talking about the 23 to 30-year-olds currently today.

32:35So how do you get this next, the second half of Gen Y, the 22 to 30-year-old-ish group, how do you keep them loyal to an organization? YPO seems to have done a pretty good job with that, where your team doesn't transition as fast. Or is that a legacy feeling? No, no, no. I think that's still fairly accurate. I think our turnover is in the sort of 2025. 25. Listen, I think turnover is healthy too. Part of my dilemma in the early days of my business is I came from the old school. I watched my father. I've been to stay and I've tried to build my businesses around that. So I'd take a person in a junior role.

33:10I'd look after them. I'd accept weaknesses. I'd mitigate forward. And you end up building almost what I would call a bloated structure. I did that twice. I built this loyalty. And what I found was while I thought I was helping the individual, I was actually harming the individual. I wasn't really giving that individual the opportunity to be the best that they could be for me and be totally fulfilled and maximize their potential. In one particular example, I over-promoted an individual, got to the point where this person was getting paid more than a junior level contributor that was doing three times what the individual was doing.

33:49And I think we all make those mistakes. So So one is clearly understanding the current role requirements, having a really good, simple, simple and continuous feedback loops. Because the last thing you want to do with a 22 or 23-year-old is not give them regular weekly or monthly or regular feedback. Because they're very into their personal development. The old way of every six months sitting down, doing a review, how are you? So managers today need to be talking to their employees, their subordinates almost weekly in terms of making sure that they're effectively supported, doing what they're expected to do, and that they're fulfilled in their role.

34:31Purpose is another big one. I find that a lot of younger people today, Cameron, will not work for an organization unless they clearly align their value set with the purpose and values of the organization. That sounds like a truism, or it may sound trite, but I can tell you that in our organization, in others that I closely work with, I sit on the boards of a number of companies, that's a very big attractor. And so often, we think that you've got to pay top dollar. If you don't get your values right, in fact, if your values are right, the conditions of employment are right, you care for your people, you give them upside.

35:07And by the way, if they do lead because there isn't a role for them in the organization, when they lead, you've prepared them so well, you've given them the tools, you've given them the right sort of examples, they'll go on and be your advocate. That's right. Way longer past their employment with you than you will believe. And there's statistics behind it. That's such a huge point for entrepreneurs and for leaders to actually understand is that our job isn't to try to keep people forever. Our job is to grow them and keep them for as long as they're useful and they're having fun and we're having fun and then set them free almost like we're growing our children, right?

35:41Our job is not to keep our kids at home forever either. 100%. And then there's the classic, right? You've got to measure what you're looking for. So we do engagement surveys and we look very tender. We do it by department. We slice and dice it in a number of different ways. And we'll see, you know, this department is not doing great. Well, what are the ratings on the manager? Boy, the impact of a manager's behavior is so profound on the people that are reporting to them. It's a direct correlation to success. You look at the work that Michael Bush is doing in the best companies to work for. He's the CEO there, and you look at the statistics.

36:17You look at Fortune's list of best places to work. You look at their research on leadership. it all boils down to particularly for the younger individual the person leading them mentoring them guiding them and that's where we spend a lot of our time with our managers teaching them training them i spend a lot of time and as do our c-suite individuals coaching a level down or two levels down mentoring another one huge how do you learn right it's interesting you keep going back to the data a lot as well and how data making decisions. Is that something that is a new skill for you? I was in businesses that were very data heavy, building low income housing.

36:59We need an engineered product. You have to be on top of all the detail. But in business, professional services business, which really YPO is, and how we're modeling ourselves, data is the lifeblood of our business. Understanding what your member needs are, understanding where the markets are, the cultural differences, the nuances in different chapters and regions, what's working and what isn't, the effectiveness and the outcome of certain events that we write. You know, we're putting on a mergers and acquisitions seminar, and we're getting a neck promoter score of, you know, 10, as opposed to 90.

37:33We're doing something wrong. Wow, yeah, very much, yeah. And I love that you're using it. Do you ever allow your gut to overrule the data, or do you just trust the data? I have learned that if I go to data first and I sleep on my gut reaction, it's more a 50-50 or 60-40 in favor of the data today. Yeah, and what I'm finding is if my gut's trying to overrule the data, I go look for more data. And the data will sometimes will play out and either change to prove my gut or the data will just start to really slide in the favor that my gut was just wrong. And also I've learned that the leadership journey doesn't need to be a lonely journey.

38:15I'm blessed with an incredible group of individuals that I can go to for advice from their experience. I can pick up the phone and talk to a CEO who's running a$300 million business, roughly the size of our business today, and say, how have you dealt with this issue? How have you worked with a board? What are your compliance things? What sort of experience have you had in this different area? I can get an instant answer or two or three different answers, calibrate, and then make my decision. Yeah, well, I've never been smart enough to figure it out on my own anyway, so I like to rip off and duplicate.

38:50Why would I try to figure it out when I'm sitting with a forum group of 10 people who have already figured it out? On a way you've been helped, right? I mean, part of the integrity of leadership is also not necessarily taking the credit. it, even though you're the deciding force and the buck stops with you, or in my case, the buck stops with Scott. He backs me up, by the way, 100 % in my decisions. That's the other important part, which we didn't discuss, is how two people who are running an organization support each other and what sort of rules should be in place and commitments. How do you stay in sync with the CEO and how does the CEO stay in sync with you?

39:25And how do you decide roles and responsibilities between the two of you? Because it is kind of a two in the box. communication, agreement, and agreement. I mean, we sit down, we do days away together, which are just spectacular. We do a lot of forum stuff, start with a softer interpersonal, how are you doing, what's happening, you know, really get connected as people. We look at authority matrices. We're very open in terms of discussing what's working and what isn't. We have a format that we follow, that are the baseline agenda. We share our views openly, without critique. We agree to disagree.

40:00But when we leave that room, we're 100 % alive. We're very clear on our roles. Once a year, we sit down and we say, okay, how are we doing on our roles? My commitment to my CEO is I'm a vision amplifier. I'm an executor. I'm not in the limelight. I am not the ultimate accountability individual. And I had to get real clear with that because for 25 years of my life, I was. You were, sure. It's got to be openly discussed and agreed to. The definition of decision-making rights, what's appropriate and what is appropriate, you've got to get clear on that. If there's any gray in that area, you're going to butt head.

40:35And on the flip side, I need support. I don't need to have anybody utilizing a backdoor to countermand a decision. If there's a backdoor, I've got to be told about it. And this isn't about restricting people from meeting. We have a very clear, open authority that anybody can talk to, me or the CEO. If you create the culture of we're going to be very openly open transparent um but that's very very key and there any changes that come up we have a commitment to each other that if we for one minute suspect it there or feel that something isn't right we pick up the phone yeah it sounds communication communication yeah occasion agreement and then telegraphing it to the rest of the company when we go out we do this consistently we'll sit in our senior team leadership hey you haven't been CCing Scott, you haven't been CCing Sean, I just want to remind you, you know, we're a partnership.

41:30Here's how we expect to be communicated with. And it's reinforcement. Once you get into that rhythm, it takes time and it takes the right combination of people. It's not easy. But if you get it right, and I feel we've got it 99%. If we were to rewind back to the early days of your career as a CEO, or really early days of your career as a COO, what's something that you've really, really learned that you've really gotten good at that you wish you'd known earlier on? What's a lesson that you wish someone had told you or you could tell yourself as a 20-something entrepreneur? I would not rush any type of communication interaction with key employees.

42:10I've learned to take time. In the old days, it was ready, fire, aim, ready, fire, aim, one thing to the next to the next. What happens with that is you lose connectivity and you don't establish relationship. The more you put into individuals, the more that you'll be able to have them respect, trust, forgive you, give you a little bit of leeway and slack because we know that the world is messy and you know that business is messy. Business is never a straight line. The old adage of the hockey stick going up, it's a whole bunch of little wrinkles and swivels and ups and downs and hopefully the trajectory is in the right direction because you, you know, we all aspire to improve.

42:50The mantra that I adopted, which I never had before, was operated as a leader with a servant heart and a business mind. That's great. Certainly your step is huge. Sean Majanis, president and COO of YPO. Really great learning from you and sitting and listening to you again. And wonderful that we've met 20 odd years ago. And thank you so much for being on the Second in Command podcast. You've been listening to Second in Command, brought to you by COO Alliance founder, Cameron Herold. If you enjoyed this episode, please be sure to like, share, and subscribe to us on Apple Podcasts, Spotify, and our other podcast streaming platforms.

43:25For more best practices from industry-leading COOs, visit COOalliance.com.

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