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Diagnosing The Workplace: Not Just An HR Podcast
Diagnosing The Workplace: Not Just An HR Podcast
Stressed Out Founders, Building Employee Trust, Customer/Employee Retention - Answering Listener Questions
In this episode, we explore 3 questions from listeners and conversations with clients:
1. What Do You Do When The Founder Is Too Stressed To Invest In Solving Business Issues?
2. How Do We Build Trust With Employees?
3. What is The Connection Between Customer Retention and Employee Retention?
Our prescription for this episode: Understand how vital elements like employee retention, trust, and workplace culture are to business outcomes and sustainability.
Past Episode Referenced:
S3 E13: What Is Transformation Fatigue And How Do We Overcome It?
S2 E21: What Is The Technical Founder Paradox?
You can reach out to us to talk more about any of these topics, contact us at info@roman3.ca or through our LinkedIn page at https://www.linkedin.com/company/roman3
Don't forget to sign up for our New Quarterly Newsletter that launched in 2024.
About Our Hosts!
James is an experienced business coach with a specialization in HR management and talent attraction and retention.
Coby is a skilled educator and has an extensive background in building workforce and organizational capacity.
For a little more on our ideas and concepts, check out our Knowledge Suite or our YouTube Channel, Solutions Explained by Roman 3.
Breaking down everyday workplace issues and diagnosing the hidden sickness, not just the obvious symptom, our hosts, James and Coby.
[COBY]:Did we lose a patient?
[JAMES]:No, that's just m. My lunch.
[COBY]:Hey, thanks for joining us. I'm Coby, he's James. And we're going toa do something a bit different today. We're going to answer some questions posed to us by you, our faithful listeners.
[JAMES]:Yeah, so another Q and A question episode. which is great. We, I really like the, switching up the format a bit and answering some of these questions. So what we're going to do. Coby, I'm going to toss the first question at, you. What do you do when the founder or business owner is just too stressed out to invest in solving business issues?
[COBY]:So this is something that we've been kind of seeing more and more and talking about more and more with some of the partners and collaborators that we work with. and this question is really kind of more about addressing that issue than anything else because, I mean, kind of going back to the episode we did a couple episodes ago about, transformation fatigue and burnout, it's the idea that, you know, there's a bit of, you know, like, sometimes people are too stressed out, too burned out from all the need for all this constant change, that there's tired of it. There's that, in something that's, you know, is a difficult situation when businesses, you know, that are well equipped to handle stuff, they're just like, you know what? I'm exhausted. We don't want. We want to move beyond this problem. That's what we talked about with transformation fatigue. But something that we're also seeing that’s 'just as damaging and surprisingly just as common is when the founders are almost like dealing with, well, let's be serious. Business owners and founders right now are dealing with a pretty stressful time economically. So a lot of them who are just, they're feeling really stressed by internal and let's be serious, a lot of external factors, and that stress is causing them to have a block on how they can deal with pertinent core issues that are putting the business at risk, but they're too stressed out mentally to o their depth, with all those coming at them to actually be able to kind of focus, kind of put on a cool head and actually tactically invest time, effort and resources into solving major business issues. And this is something that is a little bit more about almost like an, unfamiliarity. Ah, with some of, how do you take this focus and deal with these Longer term issues. Think longer term. and it is a major problem that we're definitely seeing in a lot of different businesses.
[JAMES]:Well, what were. I think it'd be helpful to get into a little bit of an example. But I think first really what we're talking about is the outcome or what happens when you do not address things like the technical founder paradox. we've talked about the Technical Founder Paradox many times on the show and but really what we're talking about is there comes a point in pretty much every business owner, entrepreneur, founders journey where the skills that made them very successful early on in starting the business and growing it. If those skills do not change and adapt, it's what's going to keep them back from being able to take their business to the next level. And that's what we're seeing a lot of. It's a people getting themselves into situations where they are on in unfamiliar territory. It's in a domain that they don't have the bench strength in. and they have not done the prerequisite work along their journey to either build the capacity to address these issues or to find somebody who can augment their skills and delegate those responsibility to somebody who understands and is able to address them. So really this is a continuation of that technical founder paradox that we see in virtually every entrepreneur or business owner hits at some point in their journey and it's hitting the Technical Founder Paradox is not in and of itself a negative. We all have limitations in our skills. We all have certain pieces that we are very good at and that's what we tend to build our businesses around. If we fail to expand our skill sets as founders, then we are going to hit a wall where we run out of problems that can be solved with our current skill set.
[COBY]:Yeah. And so I think that I'll just kind of quickly kind of point people if this idea of dealing with stress managers is something that you're dealing with, you want to learn more. Like we said about transformation fatigue. I'll put the episode, it was a couple episodes ago but I'll put episode number in the show notes. And then we did an episode solely on the Technical Founder Paradox that il put that episode listed there too. But you're right. This is about them. Often they have like domain specific expertise to what the businesses provide but they don't have the competency in financial forecasting in of the investments required for sustainability.
[JAMES]:Those types people management in these, I mean if you are an expert in Marketing. And you want to start your own business, you're probably going to start a business. You're going to open a marketing agency. Right. It makes sense. That's where your strengths lie. If you are a phenomenal cook, then you may start a restaurant. Right. We build businesses based on the skill sets that we have. Right. But nobody can do everything themselves.
[COBY]:Right. Especially we hit a certain scale.
[JAMES]:Well, exactly. And nobody should be expected to carry all of that weight themselves. And yet founders still put all the responsibility on themselves.
[COBY]:Yeah.
[JAMES]:And it's, you cannot. Very, very few people can change and adapt and grow and to build a requisite knowledge in all of the different facets of business growth and management to be able to do it by themselves. Can it be done? Yeah, there are brilliant people out there who are a, hell of a lot smarter than I am. But is it regularly done?
[COBY]:No, no, no, you're right. And the thing too is that, you know, the stress that business founders and owners feel when they're in this area outside their domain specific expertise is really what we're talking about. And usually it's in. And usually it's the problems dealing with are outside their domain specific issues. So they almost have two kind of areas of stress. The domain that the weakness or the risk is in, like whether it's they're not bringing enough customers in. So there's a marketing and sales issue, whether it's a, they have major turnover issues, so it's a people management issue or whatever it is. There's that area that they're unfamiliar with. But if they haven't built another sales skill set about again, financial management and financial forecasting, then the ability to invest in having someone help you or wisely purchase or partner or whatever it is to with someone who can solve those first sets of issues, that's another area of stress. And this is, I think is where we're seeing a lot of businesses. They even have people because again, we work with a lot of partners and consultants who are the person that can help them solve the area that they're struggling with. But the business owners are like, well, we can't invest in that because money's tight or, or we're losing customers, so we can't invest in the issues that we're having. And the problem is when the issues are around turnover or they're around, you know, customer acquisition, they like we, it's almost like they're saying we can't afford to bring in new customers because we don't have enough customers.
[JAMES]:Yeah, Right.
[COBY]:And that's really kind of where this stuff kind of falls. It's this idea of they're too stressed out to invest in solving their issue and these. So the problems become circular and they end up being kind of how you kind of dig a hole for yourself you can't get out of.
[JAMES]:Yeah. And I mean the conversation that was where this question came up and was catalyst for this, question. I mean the person was working with a business and helping them to build their marketing and had proven, had, you know, the leads, the conversions, the customer acquisition had increased steadily over the time that they had been working with them, with the time that our contact had been working with their client. and yet they, their customer retention was what was killing them. They weren't able to actually keep people, long term. So it was just trying to pour more money into a leaky bucket. But the work was being done. The work was actually making a significant difference. And what they needed to invest in was figuring out how do we actually hang on to people once we attract them. But because the cash flow, they weren't willing to invest in the retention.
[COBY]:And, and that was what was so funny. So our contact was saying, yeah, so we've been having these great campaigns, we've been converting these great leads. We're bringing in like 20 new customers a month, but they're losing 15.
[JAMES]:Yeah.
[COBY]:So there's still a net positive gain. But the problem is, is that, you know, I don't know, I don't have access to the tools. I need to figure out how do we cut that 15 down to say seven and all. And they went to back to the founder with a pretty small ask of can we have. Here's a small budget with these tools, we can actually start to kind of cut the retention number down. And they were shocked that the business owner was like, we're a little too cash strapped for that right now. So just keep trying to bring customers in. And he's like, well, for how long? Right. How long do you expect to kind of keep this bailing out this leaky boat? Right. But it was the founder riches. But they were just so stressed it couldn't see past the very, very first step of coming in with me for money. And you. We're cash strapped, so we can't invest in anything. Even if that thing that we're investing in is. The thing will free up money. Right. It's a tough place to be in.
[JAMES]:It is. And I do empathize with the founder. I mean it is money is always what keeps you up at night.
[COBY]:Absolutely.
[JAMES]:it's, and cash flow is a major consideration. I mean you have dozens and dozens of employees who rely on you for their livelihood. You've got customers and clients who rely on you for the goods or services that you're producing. There's a lot of stress that comes with it. The problem goes back to what we talked about of this is an area that the founder doesn't have a lot of real technical expertise in. Understanding how all of these pieces are interconnected and rely on each other. And just addressing one can help in the short term. But for long term growth you need to actually not just try fix the attraction of new customers. You need to also for their particular business model, you need to hang on to them because it's, it's not a one and done single purchase model.
[COBY]:It's a, well, this business lives and dies on the lifetime customer value.
[JAMES]:Yeah, absolutely right.
[COBY]:So I mean in those kind of businesses the retention is so vital, but I mean that's really not that different from what we kind of see in a regular basis where we'll have businesses to bring us in to do kind of an early diagnostic, help them identify their issues and then we'll say okay, so you have, you know, so like you, you have some major employee retention issues. And they're like, well we're kind of used to that. So we've invested in like better recruitment and better this. it's almost like they accepted the churn as just standard operating procedures. And we're like, well, you know, it doesn't have to be. If you could div. If you shifted away and spent a little bit more on retention, you, you wouldn't have to invest so much in having such a great attraction program. but the idea of like you like, well I, you know, this is how we do business. And I'm too like, you know, I'm too like flustered to think is one.
[JAMES]:Of the 4700 other things on my plate right now. I mean part of it is legitimately there's a lot that needs to be done to keep a business operating and growing.
[COBY]:Right.
[JAMES]:And especially in smaller organizations, you know, it more and more rests on the founder or the leader. And so breaking through that, that need to focus just on what can I do today. Because while that is very important that the day to day gets taken care of, if you are just have your head down, blinders up, and you're focusing on just what's in front of you today, you're going to land yourself in the ditch, you're going to walk right off a cliff or walk into the ditch because you're not taking the time to look up and actually see where you're going and make a plan. Right. It's the idea that you need at some point you have to stop working in your business and start working on your business.
[COBY]:Absolutely. And then to go back and answer the question of what do you do when your founders too stress to invest in solving business issues? I think a lot of it is the founder needs to develop level of comfort and confidence in the financial planning, in the financial management, and even in the areas where they're struggling and the, risk is. And the way that they can do that is a few different ways. Again, this is kind of going back to the episode we talked about, the technical founder paradox. It's about building the competency yourself. Or it could be about bringing in a team that you can trust that will allow you to kind of help you through. And you have to be open to develop in the comfort and confidence. And I think. And third thing, you need to start focusing on the business un. Less in the business. Because again, if we are, if we're too stressed out to invest in solving our issues, our issues are what take us down.
[JAMES]:And it can be really, really difficult to place trust in other people, especially around key aspects of your business if you're used to doing it all yourself or holding a lot of these responsibilities. Yeah. it can be a significant challenge to kind of delegate that and empower. It's not just about delegating. It's if you're going to delegate, you need to actually delegate the authority, along with the responsibilities.
[COBY]:Wow, that's. That's a quote right there. You have to delegate the authority as well as the responsibility to solve the issues is something that I think most people go, oh yeah, you need both.
[JAMES]:Oh yeah, you can't just tell somebody to do it, you have to give them the authority to do it. I mean, that's a great way to just piss people off.
[COBY]:Yeah, yeah, yeah. Well, well, it's like, hey, intern, you know, unpaid intern. You're responsible for figuring out a fiscal solvency over the next five years. Good luck. Like it's. Yeah. But I do think though, the one area that we probably could dig into a little bit more. I, maybe this is an idea for an upcoming episode is about how do you almost like create a bit of that comfort and confidence or reframing how you understand the financial planning of your business. So that way you do feel like you're in a position you can invest in solving our issues.
[JAMES]:Yeah, it would be nice to do a maybe, a full episode on kind of the practical steps that a founder can go through.
[COBY]:Yeah. Or at least, or at least better understanding where some of your money’s could be re-Divested or. Or, yeah, I think that might be something for us to think about doing it.
[JAMES]:Maybe we should actually plan the episode off camera.
[COBY]:But, yeah, we'll try that for a change. But yeah, so hopefully that, you know, us talking about kind of like the different kind of where it comes from and kind of like how you need develop comfort and confidence is enough of an answer for this specific question. But I do think it's something that people should be really starting to ask yourself. How do we see this problem, but how do we actually address it?
[JAMES]:Yeah, it's common enough. It’s worth its own.
[COBY]:Yeah.
[JAMES]:Cool.
[COBY]:All right, so let's move on to the next question. I'll ask this one to you.
[JAMES]:Okay.
[COBY]:All right, so question number two. How do you build trust with employees?
[JAMES]:Well, we just talked about trust.
[COBY]:Didn't we've talk about a few things?
[JAMES]:Yeah, but, yeah, so trust is huge. And it's a funny thing. If it's been broken, it can be extremely difficult to build back. and if you've had your. If you as a leader have been burned in the past, you may be very reluctant to actually trust others because it has blown up in your face. But trust is the only way that you're going to get that delegation is actually going to work. If you don't want to do everything yourself, you have to trust that other people are capable of doing the work. Right. So how do you actually build that trust? Honestly, the best method that we have come across for the early stages is a combination approach. It's creating very clear expectations with people. We've talked about setting and managing expectations dozens of times. It's central to so much. And if you build that skill, that's going to help you in every situation. But specifically with trust, you need to have very clear expectations of what people are responsible for, what they are allowed and what they are allowed and not allowed to do. So one of the projects that we're doing right now is very closely aligned with building, some trust and authority in a leadership team. And the methodology that we've been using is creating very clear expectations through, detailed job descriptions. So, you know what, not, not just your basic job description of, you know, here's a general overview of your responsibilities, but actually going into what is the intended impact of this role? What does success look like in this role? How are we going to measure success in this role? Those expectations are critical. If you want to build trust with people. They need to know what’s expected of them, what success looks like and what they going to be measured against. So that is the first critical piece that needs to be in place.
[COBY]:Yeah, And I think like too the idea of this trust is a two way street. There are a lot of leaders that feel like they can't fully trust their employees. But I would say there's a lot.
[JAMES]:If you are the leader, your responsibility is to lead and trust first.
[COBY]:Right. So I would say a better way to put that is your job as a leader is to trust but verify, right?
[JAMES]:Yes.
[COBY]:But I mean the idea of like, you know, a lot of employees feel that their leg is to broken trust. We see that all the time. Often when we go in and we have to fix kind of organizational like culture issues. Usually the trust is one of the core tendencies of, of what went wrong. And a lot of times it's that employees don't, they don't feel like they can trust or even kind of like let their guard down around their supervisor, around their manager. And that's kind of where the fundamental breakdown of most things kind of happen. And you know, and this is kind of a case of what you referred to as kind of the project that we're working on now with the leadership team. But part of it is it really goes back to like you said, kind of what you were saying is transparency. It's the idea of building a sense of like, you know, again, good job description seems like a weird, almost like lame answer to how to build trust. But when we say that, we say when you think about our traditional job description, throw that out the window. That's not what we're talking about. We're talking about a document that's almost like a core foundational piece that should be part of how the employee understands their job, their role. It should be what they're referring back to on a regular basis, not what they're looking at when they sign the contract and they put into a file and never see again. Because again how success is measured, what success looks like, the intended impact, where your levels of authority are these types. This is what kind of creates this clear, transparent like fence for you to work in. It's like. And the idea of if you know all these things, if you know how things are, what you're going to be held to and what you're expected to deliver on and what success truly looks like. Not just what success looks like. Different day to day, different manager to manager, what success will almost empirically look like. That's something that, that level of transparency makes it a lot easier for the employee to go, okay, I know what's expected of me. So it's easier for me to kind of trust the process because the process could not be more clear.
[JAMES]:Yeah. And it needs to be integrated clearly into your performance management process as well. And frameworks. but the second part of that really is like the job descriptions are critical, but you also need to develop. Doesn't need to be as formal as this, but we use a framework of professional limitations which sets the rules for what people are not allowed to do. It's all framed from, it's honestly, they're all framed from the negative. They're the, the thou shall not. Right. So in leadership positions, maybe there's a certain amount of money that you can spend, that you have some budgetary discretion. and you know, so the, maybe that threshold is $10,000. So the limitation would be framed around, you know, you shall not spend more than X amount, without approval from whatever person. Right. It just really goes through and sets the. As Coby, you were saying, it sets that fence around what you're allowed to do because if you know what's expected of you and how success is going to be measured and you're told, here are the things that we don't want you to do, everything else is up for grabs. Right. It actually, by creating these limitations, it creates more freedom. By providing people with some freedom in how they do their job, you can show that you trust them. So these things are interconnected, stumbling over my words. but they're critical to actually answering the question of how do you build trust? You can actually create a framework that builds trust.
[COBY]:Yeah. Well, and the thing too is that most people think that the biggest cause of broken trust between employees and employers is betrayal. Now betrayal is definitely a. It happens, it happens. But I would, I would go as far and be as bold to say it is by far not the biggest culprit. I think the biggest culprit to eroding trust between, between employees and employers is expecting that employees figure stuff out on their own with little direction like mind reading and the realities of inconsistency. I think those are the big two. So a lot of we say, how do you Build trust with employees. What you need to do fundamentally is you need to remove guesswork and you need to kind of. And you need. System need to like systematically remove inconsistency. And that's really the big two. And what you were saying about job description, professional limitations is a very practical, tangible way to achieve that. It's not simple. It's not. It's something that know not going to be quick. No. And we don't recommend you listening to this. Oh, these are the two things. I'm gonna go do this on my own. I'd recommend against that. but I mean, it's something that. This is where this stuff needs to kind of come from is you need to create this transparent, clear process into your standard operating procedures, into your performance management systems, into all the stuff that you do. It needs to be like woven into kind of your fundamental HR systems and processes. Because that's where. Because trust is not usually broken with a big betrayal. It usually starts cracking with expecting guesswork, inconsistency and then eventually enough straws break the camel's back. And that's when trust usually goes away in most cases.
[JAMES]:I'm glad you brought that up because even just thinking back, on experiences in my own career, the times when I have been most angry or felt betrayed or ticked off at my boss or whomever has been. Instances exactly. Of that, it's go do this thing with very little, direction or authority or whatever, and then you do the thing to the best of your knowledge and professional judgment and you get penalized for it.
[COBY]:Right.
[JAMES]:Well, you didn't do it exactly the way that I wanted you to. Well, then you should have told me how you wanted it done. Right, right. Like, but legitimately you're right. That's how trust erodes over time. So if we can remove some of that guesswork and make sure that expectations are very clearly articulated and that people are. People know how they're going to be measured for success. Man, it just, it makes things so much easier when it's done properly.
[COBY]:Yeah, well, and what's funny is that, you know, one of the things that we always enjoy doing when we, when clients bring us in to kind of do some early diagnostics and to kind of help them. Them find some of their core issues. Usually one of the first things that we tear apart is their performance management system and their job descriptions and that kind of stuff. Because of this. Because we largely say where this is where we think we should start. Because this is where the trust is eroding. The Fastest and without the trust, all of your big goals are completely impossible. And it's one of those things where it's so common that there's this similar situation in most businesses that again, the simple diagnostics, identifying the major issues, identify the gaps. Here's the plan for forward. It's not an easy process, but it's uncomplicated and it's surprisingly consistent. So like this is something that we always say with most businesses, if you want to actually start to build the trust, something is simple like our process of. Sorry, like our diagnostics to assess your processes really are where the effective, long lasting change comes from.
[JAMES]:Yeah, move on the next one.
[COBY]:Sure.
[JAMES]:All right, so the next question is what is the connection between customer retention and employee retention?
[COBY]:Right. That is. And that is a good question. And I remember when this question got asked and it was something that was. It's funny because most of the time people have a pretty kind of like, you know, superficial or superficial. I think that's a bit reductive. They've got a clear picture in their mind, but the picture is very limited on. Well, obviously you need employees to serve customers, so there's obviously a connection like again, kind of at that service level. But I think that the question that we often bring to the conversation that makes that question a little bit less of an obvious employees are the ones that serve customers is kind of. Is to dig a little bit deeper. We often ask the question, well, who delivers your value proposition M. What is the impact of all of your employees on the customer experience? Because it's. Because not every employee in every business has the exact same impact on customer retention. Because again, some employees have a much greater impact on retaining a single customer than others. Right. So one of the things that we often like to kind of tie to is when you're thinking about that connection between customer retention and employee retention is to really kind of figure out what type of business model, customer experience model that you operate with. and that should really tell you about how vital your employee retention, your employee, Employee experience is toward your customer attention and your customer, experience.
[JAMES]:Yeah, I think I want to jump on the idea of who delivers your value prop. because that's an interesting way to reframe the question that I think there's a lot of value in exploring. So well, I mean we've worked just going through some of the different types of companies that we've worked with. over the years we've worked with private educational institutes and I mean a single teacher in A classroom has a massive impact on delivering the value proposition of the company to the students. Right. It's all about quality of the curriculum, the quality of the instruction, the activities. So in terms of who delivers the value proposition, I would say like 80 to 90% of the value proposition of the company is reliant on the individual in that classroom delivering value.
[COBY]:Yeah. And I'd say like, like account managers, we work in businesses that have a lot of like their sales, like you know, their sales are done through specific account managers. They're probably in the same boat too. Right?
[JAMES]:Yeah. Like I mean even looking at businesses that we engage with, like there's a software that we use in our business that we have account managers and the software is a huge part, like it is a huge part of their value proposition. Right. The software itself is probably more like 70% of the value proposition. But the account manager still has a big impact. And like I'm thinking about this in our case cause fortunately we've got a great account manager who has been really responsive and accommodating. when we have questions, they're right there, they're walking us through things. So while even in a software business you would think, well our value proposition is the quality of our software, the impact that that account manager has on my satisfaction with your software is pretty significant. I love the technology and it's a great tool that we use in our business. But the, there's still, I mean I'm contrasting that with a teacher where like 80% might rest on them and you know, 80% might rest on this software but there's still a significant human element in play.
[COBY]:Yeah, Well, I would actually say that I would disagree with you a little bit on the, I think the account manager probably has in the short term a know, I would say, I would say that's probably 80% of your, of your value proposition is actually with the account manager. Because you, because especially during the onboarding system or when you're familiarizing yourself with it every piece. I mean we are, you and I are very tech savvy. We a lot of tech in our work but I mean we are awkward and ham fisted using new software like everyone else is when you first start out and its experience with the account managers that make, help build the confidence in that familiarity, the learning curve. Right. so I would say over the long term, I would say its like 80% account manager, 20% software until you hit a certain point when you've developed kind of mastery with it, then that probably reverses.
[JAMES]:Right. I mean as I become more comfortable and using the software and I'm more familiar with it, I'm going to rely on them less, my interactions with them will be less and therefore the delivery of value proposition is going to be less. Right, that makes sense.
[COBY]:Yeah. But I would say like teachers, in this case account manages, even like brokers. Like we've done some work with kind of different corporations and different organizations that have like brokers and stuff too. But though even those that we've worked with, even our brokers who were the customers, they are vital to the customer retention. And we kind of refer to that as like single impact retention. right. Because it's about this single teacher, this single broker, this single account manager. They deliver the most critical employee experience is them. So when we say about that connection, so losing that teacher, that broker, that account manager is devastating to your customer retention.
[JAMES]:Yeah.
[COBY]:Right. So those are things that we talk about the relationship. That single impact, experience is a huge blow to it. Which is why you know, in those. So if in your business, if you listening in your business, if your major customer experience relies on those single impact, a single point of contact, then the retention requirements for those positions should be your number one priority. You should be focusing on employee retention over customer retention because your employer retention is the key to your customer retention. Right, right. but then to contrast that there's businesses that operate with like retail or food service where it's usually not about a single experience, it usually more about multiple customer or multiple customer interactions. With outside of the extreme it a lot, it takes a lot of customer interactions with different people to kind of have that impact. So it's almost like there's a collective of employees have the impact on the customer experience. And I think so again, knowing that value proposition, is it a single impact or is a collective impact is something that is an important consideration as well.
[JAMES]:Yeah. Single versus collective. I'm with you. retail, I agree. Food service, not so much. no, because I think about the impact of a. So if I'm going into a retail environment, I'm buying ah, a new shirt and I have a negative interaction with an employee there. It probably, it may make me reconsider, or it's probably not going to change my purchasing decision. If I've already decided that I'm buying a shirt, it might. So I get that. But with food service, If I'm sitting down to a meal and I have a negative interaction with the person who Is with the waiter, waitress that has a much more direct and significant impact on the customer experience than maybe retail. So yeah. Anyways the single versus collective is spot on. I think the retail example is spot on. I think there's, it might depend on the, I mean in a fast food environment a single negative experience may not have as direct but I mean it also maybe it's you know if depends on the. What is the value proposition? Right. With fast food it's fast and cheap and unhealth. well at one time it was. I don't, not so much anymore. But if you're right. So maybe it's… but if you're setting expectations of a like world class dining experience and the employ and the interaction is subpar that's going to have a much bigger impact. So the how you position your value proposition may have an element to do with that as well.
[COBY]:Yeah, no that, that's a really good point because I mean like it's kind of good to kind of list different types of what's single, what's collective. The other one, there's a third one too. which is about the impact of product quality. You were saying with software it kind of like the software quality is the main impact of customer experience. I would agree with you, your dev team, those types of things. But also think about manufacturing. Its about the employees don’t have any impact on the customer experience because they’re not customer facing employees. But its the quality, the consistency, the reliability of access to the products that is fundamental to the employee experience. So there is that third element too that there's kind of like we say there's kind of these three types of value proposition for businesses. There's a single impact, there's the collective impact and then there's the quality impact. And how your customer retention is affected by those three is really what is the impact or what is the connection between employee retention to customer retention in a single impact. We're talking bus drivers, we're talking like teachers, we're talking like anyone that has someone's job is to provide face to face or consistent, you know they're the main connection between you and the business. Huge impact. When it comes to collective impact, it's about again if I would agree with you based on where the proposition lies but again if the expectation is you deal with multiple customers or sorry multiple employees in a small and superficial kind of way then it would take, then the collective impact impacts the value proposition. Whereas when it's about quality, when it's a quality impact. It's about having reliable employees who are producing quality software, quality products or whatever it is, call it transportation, in order to make sure that you feeling that your impact is about the reality of what you've experienced by receiving the product reliably high quality. So going kind of. So the answer is kind of it depends on which of those three things you have. But my advice would be of anyone that's interested in this connection between customer retention and employee retention is to be kind of clear, well, who delivers our value proposition? Is it through single impact, is it through collective impact or is it through quality impact?
[JAMES]:So yeah, yeah, that's great. Cool.
[COBY]:All right, so I think I'll just kind do a really kind of quick summary. This has been a pretty good conversation. anything else you want to add before I do?
[JAMES]:no, I'm good.
[COBY]:All right, so, so the first question was what do you do when the founder is too stressed to invest in solving business issues? Well largely we talked about that the answer to this kind of thing is that they need to develop kind of comfort and confidence in the areas that they may be experiencing the challenge in if it's outside their domain specific skill set and having some kind of comfort and confidence with the financial planning, forecasting and management. So they can invest whether that's time, effort or energy. But it's something that this is kind of a symptom of the technical founder paradox knowing and also a symptom of the transformation fatigue. I recommend if this is a question that really connected with you to take of those two episodes, which I'll put in the show notes, next question was how do you build trust with employees? Well a lot of it is realizing that most trust erode slowly over time because of the expectations around. We need to read people's minds and inconsistency is kind of what is kind of how we are allowed to kind of show our employees direction or whatever. But those are kind of the two fundamental issues. If you really want to build trust with employees, processes are going to be a huge way to do that. If they're transparent, if they remove guesswork and if they eliminate inconsistency. So that's where you're going to want to start. And then last was what's the connection between customer retention, employee retention? Well really use about the idea of where is your value proposition coming from, who delivers it and is it that your customer model, your employee relation model is with a single impact where one person has a huge impact on 80% of of the value of your company is provided through that one person, like a service industry or whatever. Is it a where there's a collective impact on a value proposition through things like retail or fast food is kind of a good example of where multiple employees kind of make up that experience, or is it through a kind of a quality impact where it's about employees making sure that there's good, reliable quality of product and that's kind of what is the most common experience that you have with that company? Knowing which of those three things is your kind of model will help really drive home the point of how important employee retention is to your customer retention. So that about does it for us. For a full archive of the podcast and access the video version hosted on our YouTube channel, visit Roman3.ca podcast. Thanks for joining us.
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