Transcript:
00:01
Derek Fredrickson
Hey everybody, it’s Derek Fredrickson here from The COO Solution and The COO Solution podcast. And I am very excited to have our guest today. A dear friend of mine and as I shared in the intro, a bit of a mentor, Cameron, that if I’m being honest, I feel like I’ve been in your world and circling around for a number of years. And so I’m really excited to have you on the show. So thank you for being here, Cameron.
00:21
Cameron Herold
Hey, Derek, you’re really welcome. Great to see you again as well. Yeah, thank you for the compliment. Appreciate it.
00:27
Derek Fredrickson
Of course. So I consider you to be like the know-it-all, the source-of -all-things COO. You’ve been in this space, been in this world for a long long time. So I would just like to start off. Why do you champion this, champion the second-in-command role? What is it about the COO that have you kind of like, have dedicated your professional career for the last 10-15 years about. Why, why is that such a passion for you?
00:53
Cameron Herold
It’s interesting. I didn’t really think that it was ever going to be a part of what I did, but I had been a COO a couple of times, so I’d been a second-in-command for a couple of different businesses. I guess probably three really. I was really the COO to the entrepreneur or the Integrator to the Visionary or the VP, Corporate Development to CEO, whatever it was. I was the second-in-command three different times. And I didn’t have a community of peers. I didn’t have a place where I could go and learn. And I kept showing up at these entrepreneur events. And even though I was very entrepreneurial COO, I didn’t fit in the room. I wanted to get deeper into some of the operational issues and the entrepreneurs didn’t.
01:36
Cameron Herold
And I kind of felt like a guy showing up at a baby shower or a woman showing up at a bachelor party. It’s cute, but you don’t really fit. And then a couple of CEOs that I was coaching. I was coaching a couple of YPO members and their COOs wanted to get together with me, and collaborate. And I threw up a one-page landing page and said, if I can get 10 COOs together, of like YPO, EO kind of companies, we’ll hold an event (three days). 26 hours later, 10 people had paid $6,700 to come to an event.
02:09
Derek Fredrickson
Amazing.
02:09
Cameron Herold
I’m like, well, I guess we have a, we have an event, we didn’t really have a model.
02:13
Derek Fredrickson
You have a market. It’s proof.
02:15
Cameron Herold
Yeah, I wasn’t looking for a market. I’m like, well, I guess we’re running an event. So I ran the event with no agenda. I had all the members share with each other their skills and I had all the members share problems. And we helped them stick each other. And at the end of two and a half days, 9 of the 10 people wanted to continue meeting. And so I started the COO Alliance from that. Then I started a podcast called the Second In Command Podcast ,originally just interviewing COOs of friends of mine’s companies and of members. And then that’s, we’ve had 550 episodes now and
Derek Fredrickson
Wow.
Cameron Herold
I’ve interviewed the COO’s of, you know, Tesla and Uber and Lyft. And I’ve interviewed like some really big COOs and it was really to expose the other side of that story.
02:58
Cameron Herold
And then I guess just recently wrote the book, The Second In Command. So I’ve never set out to do it. What’s interesting is it actually ties into my core purpose. My core purpose is to help entrepreneurs make their vivid vision come true. So by growing their COO’s skills and confidence and connections, that helps the entrepreneur. All 7 of my books help entrepreneurs. My “Invest In Your Leaders” course helps entrepreneurs. Everything I’ve done has helped entrepreneurs. So it just kind of fit into that niche. And then now I just see it as a real blue ocean. Right? Everybody has events for CEOs and not many are doing anything in the COO group or in that COO space.
03:37
Derek Fredrickson
Yeah, that’s so true. That’s so true. So as I said in the intro, I’ve been, I was a member for a number of years when I was a COO. Now as a CEO, I remember I reached out to you and you said you can’t join anymore because you’re no longer a COO, you’re now a Visionary CEO of your own company.
So I want to ask you kind of a personal reflection story. So when you got started, you were in that second-in-command COO for a number of organizations. We’re going to talk about 1-800-GOTJUNK? because I think that is a fascinating story. But you’ve shifted, I think, or evolved now where you’re not so much of the operator of other people’s companies, you have a business with a number of different businesses.
04:11
Derek Fredrickson
You’re a speaker, you’re an author, you’re a coach, you run this mastermind community with COO alliance. In my opinion, that’s very entrepreneurial, that’s very vision-focused. So do you feel like you’re more operator than Visionary or more CEO than COO? Like where do you balance the two?
04:28
Cameron Herold
I’m more operator than Visionary, but I’m more entrepreneurial operator than a corporate operator. So let me explain.
04:37
Derek Fredrickson
Yeah.
04:38
Cameron Herold
I had my first company of my own when I was 20 and I had 12 full time employees working for me in my business, painting houses. And then I became part of this franchise organization and started coaching franchisees. So I was 23 years old coaching entrepreneurs. And I did that for four years.
04:58
Cameron Herold
So I was around this kind of coaching space, around this entrepreneurial space at a young age. And then the first company that I then joined as that kind of second-in-command was a, I was co-owner of a franchising group for autobody chains. And so I was an entrepreneurial COO. And then once we scaled that, took that company public, then I was hired to be president of a friend’s company. But it was a very entrepreneurial business and we scaled that and again I was a very entrepreneurial president of that company.
And then I joined Brian at 1-800-GOTJUNK? as employee number 14 and we scaled it to 3100. For me, for the first 4-ish years it was easy because it was below my pay grade. I’d already built stuff like this before. I was the one coming in, showing Brian what to do. We were very much almost like partners.
05:51
Cameron Herold
I was more of the adult in the room, the mentor, showing him what needed to be done. So I was the COO of a very entrepreneurial… we used to call it nitroglycerin like the two of us just fueled it. Boom blew up.
06:03
Derek Fredrickson
Yeah.
06:04
Cameron Herold
But once it got big, I was out of my sandbox. Right, once it got to the $100 million, you know, 248 people at the head office. 330 Cities, 3,000 employees system wide, 13 operating P&L’s. I was way out of my sandbox.
06:19
Derek Fredrickson
Yeah.
06:20
Cameron Herold
And it was big. I was kind of pulling-my-hair-out big. And then a year later, they brought in the former president of Starbucks USA to replace me. And she came in and said what a cute little company. So she was very much a very corporate COO.
06:34
Derek Fredrickson
I see.
06:35
Cameron Herold
She would have never been able to get it to there. And their current COO, who’s been there for 14 years has taken it from the $100 million to 900million, would have been horrible in the first six years too, even though he matched Brian well. He was a very corporate, polished up and down, kind of methodical, strategic. Where I was in entrepreneurial spark.
So I think I found my niche as a COO, as it was a very entrepreneurial spark hypergrowth. Yeah. If you’re growing at less than 50% or 75% growth a year, that is not for me. I’m used to the 100% year over year.
07:12
Derek Fredrickson
Okay.
07:13
Cameron Herold
So that would kind of give you my sandbox.
07:15
Derek Fredrickson
Yeah. Okay.
07:16
Cameron Herold
By the way, that’s what’s so different about the COO is. We have to match the size of our business, the industry that we’re in, the growth that our business is in. And we have to be good at the stuff the CEO sucks at and we have to like to work on the stuff they don’t like.
07:33
Derek Fredrickson
Yeah.
07:33
Cameron Herold
You’re the head of marketing for, you know, a home services business. You could probably be the head of marketing for all home services businesses. Not knowing that second-in-command role. So it is very complicated role to find and to hire for.
07:48
Derek Fredrickson
Yeah. So what I’m sensing is from an operator perspective, there’s this kind of entrepreneurial mindset of a company where a certain type of COO can be a very good fit for that. And then there might be other companies that are more, you know, larger scale, bigger structures, more corporate, where that type of the COO can fit into that role, if you will.
08:08
Cameron Herold
Yeah. That’s what’s been interesting about listening to the podcast, the Second In Command, where I interviewed all these COOs. They’re so completely different.
08:16
Derek Fredrickson
Yeah.
08:17
Cameron Herold
In fact, even for the COO Alliance, we have members now from 17 countries that are all COOs of mid-sized companies. I would probably be a horrible COO for 95% of our members’ companies. Maybe more. Even though I’ve been a COO and a very well regarded and very successful, if I don’t match, you know, the industry, size of the company, roles, responsibilities, then I’d be horrible at it.
08:44
Derek Fredrickson
Yeah, I get that. Yeah. The question I have for you is then so for like a founder, for a CEO is listening and for a COO that’s trying to understand, you know, where’s their lane? Where they can add the most value? Like what are some of the thresholds for? Like let’s use revenue as a benchmark. Like what are some of the thresholds for companies as they’re growing and scaling and say, okay, this type of COO works for a company that’s at multiple seven to low, multiple eight figures. Once you get to like $20million to $50 million, you’re going to need this type of operator. Like do you see those types of steps in the evolution of the businesses as they scale?
09:17
Cameron Herold
Yes, but it’s the second or third thing to look at. Everyone is kind of saying, I need a Cameron, right? I need a COO. I need an Integrator, Right? So the first part is, who are you? Do you really understand yourself as the entrepreneur? Do you understand your weaknesses? Do you understand the areas of the business that drain you of energy? Do you understand the areas of the business you don’t like working on? Do you know the two or three things that you love so much that you don’t want anyone touch? Do you understand the growth trajectory of your business? Do you understand some of the true idiosyncrasies that are hard in your business?
09:56
Cameron Herold
If you understand all those things, you can probably describe the person to come in to match you as your yin and yang. But just say like, what am I looking for? It’s first, who are you?
10:07
Derek Fredrickson
Right.
10:09
Cameron Herold
Then, then it is kind of looking at the growth of the organization and the size of the organization. So I would be looking for someone who has built companies from my size to a size I’m going to a couple of times. Right, I wouldn’t want to take someone from a big corporate world like Starbucks. And plug them into an entrepreneurial company. That’s actually one of the reasons why she failed was because she was a cultural misfit.
10:35
Derek Fredrickson
Yeah.
10:36
Cameron Herold
She culturally didn’t fit the entrepreneurial hypergrowth. She was very much about a brand, and corporate, decision, like, you know, very different.
10:45
Derek Fredrickson
Yeah, yeah. That’s part of what I look at as well. So when we’re working with our companies and figuring out like, you know, companies that come to us, they mostly know they need a COO. They need, they need somebody to get, as you’ve heard, the business from where it is to where it’s going to go. And when they have that realization that the founder is no longer the only solution to make that happen. We often look at size of company in terms of revenue, size of company in terms of team, size of complexity/opportunity, but also what’s their appetite for scale. Right. Are you looking to 2x, you’re looking to 10x, are you looking to exit? What’s your North Star? What’s the time frame?
11:18
Derek Fredrickson
And then from there you can get some parameters of what would be the right fit to give you the right solution, the right second-in-command to get you to where you want to go.
11:27
Cameron Herold
Harvard Review wrote an article about 17 years ago called, The Misunderstood Role of the COO. And it talked about 7 distinct types of Chief Operating Officers that would dovetail into what you’re looking for. And they’re things like a change agent. Right. Someone who’s coming in to literally pivot the organization and take it in a different direction, than the team can currently do. Or the Executor? Somebody coming in to just help us get shit done. Right. Because maybe you’re overwhelmed. Overwhelmed. Or someone coming in to grow the people, grow the team. Right. Like the mentor or maybe the entrepreneur doesn’t have the skills to grow the leadership team or the people. Or the time. Time. Or maybe you need that partner like somebody who can come in to either bring in financial or bring in, you know, business acumen that the person doesn’t have.
12:11
Cameron Herold
Or literally to kind of be there as the sounding board to help scale where they need that trusted advisor. Uhm Or you’ve got the MVP. Maybe it’s the person internally that you’re trying to promote so that you can handcuff them to the company because if you don’t, they’re going to leave.
12:25
Derek Fredrickson
Right.
12:26
Cameron Herold
Or you have the heir-apparent person who is going to eventually become the CEO when the CEO goes off to become chairman, right? So it’s looking at those kinds of things as well.
12:38
Derek Fredrickson
I listened to one of your podcasts. I don’t know if it was yours or maybe it was the one that you were on with Joe recently. I think Joe Polish. And you talked about the idea that a second-in-command does not have to be a COO. It can be a number of different roles in the organization, from COO to Integrator with EOs, to a chief of staff, maybe an ops lead, maybe even an executive assistant. Like describe a little bit about the distinction between second-in-command is kind of like the umbrella, but then there’s different flavors of what that can look like in an organization.
13:09
Cameron Herold
And by the way, first off, the term Integrator is really good for a company that is using EOS. And it’s a good internal title. It’s a horrible title to use to the external market because 99% of companies have no idea what the EOS is. Yeah, it’s like say I’m the Integrator and you’re starting to get confusion right away. Yeah, people understand traditional titles, so use traditional titles for that purpose. Now, if you’re the C level, whether you’re a chief operating officer, a chief marketing officer, chief financial officer, chief technology officer, etc., 30 Years ago, to get a C-level title, you had to be a major player at a major company.
13:49
Derek Fredrickson
Yeah.
13:50
Cameron Herold
And then around 1995, when emails started to come around, the banks recognized that if they put a big title on a junior person, they’d get through the gatekeeper. So everybody at the bank started to become VPs if you’re in investment banking. I had a friend of mine, 25, and he was the Vice President all of a sudden of an insurance. Yeah. But we’re all VPs. It doesn’t matter.
14:11
Derek Fredrickson
I’ve been in Wall Street. I’m familiar exactly with what you’re describing.
14:14
Cameron Herold
Right. So that’s where title inflation started. And then the rise of the dotcom era. From 95 to 2000, titles started to become something around the website on leadership team pages. So titles started to inflate. A true COO is somebody who has these five core things. Number one, when they join your company, they come in with a level of autonomy that they already know how to do the job. You don’t have to delegate stuff to them. If you’re delegating stuff to them, they’re probably a director of operations. If you and they are deciding together, they’re probably a VP. If they’re walking in, showing you what needs to be done and how to do it, they’re probably a C-level. Number two is they actually understand budgets, and cash flow and balance sheet and how to actually manage cash.
14:56
Cameron Herold
They understand the financial side of running a business, that’s a C-level. Number three is they come in with a level of strategic insight. They actually can see the future and because they’ve been around the space.
15:06
Derek Fredrickson
Yeah.
15:07
Cameron Herold
Number four is they bring employees with them and partners with them and suppliers with them because they’ve worked with other people and other individuals over the years. And then lastly, their roles and responsibilities match a pay grade for a title like a COO.
But when I was at 1-800-GOT-JUNK? and left 19 years ago, my comp 19 years ago was $306K. I was making 300,000 19 years ago, that was a true COO. If you’re paying somebody $140,000 a year at best, they’re a vice president of marketing, probably more like a director.
15:42
Derek Fredrickson
Yeah. Okay, got it.
15:45
Cameron Herold
Be careful. Now, a CEO or an entrepreneur really only hires a COO for one of a few reasons. Either to free up time so that they can work on the stuff they like to, or to get more leverage or so they can actually have somebody to help them grow their team and grow their people. So it’s kind of putting the right title on that right person for the right reason.
16:05
Derek Fredrickson
Right. And I think as a result of that, depending on the situation, you know, some COOs might be more strategic minded. It might be more of that thought partner to the CEO really looking at the bigger future, the bigger vision. And that kind of like the idea of how to make that happen. And other COOs are more kind of executing on the oversight of the day to day in terms of right people, right seats, and creating the structure and the process and the foundation. So, yeah, it’s a combination of both.
16:29
Cameron Herold
When I joined 1-800-gotjunk? I walked in the front door and I sat down with Brian, and after a week of assessing the company, I gave him a list of about 10 things that needed to get done. Write a franchise manual, create a franchise marketing program, create a PR campaigning program, franchise coaching program. I gave him a list of all these things and he’s like, I don’t know how to do any of that. Not only did he not know how to do it, he didn’t know that they were needed.
16:53
Derek Fredrickson
Yeah.
16:54
Cameron Herold
So here’s somebody walking in saying, not only do I know we need to do these things, but I know how to do them and I’ve done them before. And he was like, oh my God, such a breath of fresh air. That’s a true C-level person.
17:08
Derek Fredrickson
Yeah.
17:08
Cameron Herold
Right. Often the entrepreneur is trying to delegate everything they need done, which there’s some of that, right? Can you manage these people, do those, whatever. But that’s how you know what you’re really hiring.
17:18
Derek Fredrickson
Yeah. I often say to a potential client, we come in batteries included. Right. The COOs have been doing this for 10-15 years. They’re not going to show up and say, what would like me to do? They’re going to come in, lovingly and say, here’s what we’re going to do, here’s what the plan is. And also, yeah, part of that is freeing up the founder to focus on the bigger vision, the bigger future. But they’ve got the confidence and the trust of somebody that’s managing and running the day to day, not just babysitting, not just kind of keeping things stable, but actually elevating and escalating what’s going on in the organization. So it kind of fuels the confidence of the CEO and be like, yeah, I can go out and get more growth and scale.
17:52
Derek Fredrickson
Like sometimes I used to say in the beginning, founders be like, I want growth and scale. So I got a foot on the gas. But then subconsciously the foot is on the brake because they don’t want the growth and scale, because if it comes to them, it’s going to land on their shoulders and it’s just more frustration, more challenge. Exactly. So when they come in and say, here’s what we’re going to do. Here’s how it’s going to happen and I’ve got it and you can trust me to go and make it happen. The CEO is like, aah! you know, like, literally, they can breathe like a breath of fresh air. Yeah.
18:18
Cameron Herold
You know, another danger point that I’ve seen entrepreneurial CEOs do is they say it doesn’t really matter what title I give someone. We can call them a COO if they want to be called that. Ah, let me explain a couple reasons why it matters. Within about three months, they’re out there, Glassdoor and Grock and Gemini, finding out what a COO gets paid. And they realize COOs get paid $300K, but why are they only getting paid $150K? So they want a pay raise.
18:44
Derek Fredrickson
Yeah.
18:45
Cameron Herold
Or they start playing COO and they’re not willing to roll up their sleeves and get dirty and do that director work, which is really what they were supposed to be doing in the first place. So, yeah, that’s really wrong expectations. It gets people focusing on the wrong stuff and it’s very dangerous for your payroll.
19:00
Derek Fredrickson
I have a question for you because you have a lot of experience, obviously, with this. So our model is Fractional. Right. So it’s part time. It’s a done-for-you C-model.
19:08
Cameron Herold
You don’t, you don’t know this. By the way, do you know what my very first company was called when I left 1-800-gotjunk? 19 years ago?
19:14
Derek Fredrickson
No.
19:14
Cameron Herold
It was called Back Pocket COO.
19:17
Derek Fredrickson
I’ve heard that. I’ve seen that. Yeah.
19:19
Cameron Herold
And the reason was you can’t afford me full time, but you can’t afford not to have me in your back pocket to pull me out when you need me. I was a Fractional COO before they existed. The term Fractional whatever didn’t even start until about 12 years ago.
19:36
Derek Fredrickson
Yeah, I love that. You’re like the OG man. I’m telling you. You’re like the trailblazer.
19:40
Cameron Herold
I just didn’t want to work full time for a company, but I wanted to help a few.
19:44
Derek Fredrickson
I get it and a lot. You know, I have 14 Fractional COOs on my team right now. We bring one or two every month for the two to three new clients that we bring on every month, they’re all what I call, Fractional for life. They may have been in a corporate permanent COO position, but they like the variety, they like the independence. They like not having all of their eggs in one basket. But my question for you is, I’ve had this conversation with founders and CEOs where they’re questioning is, Fractional the right model? Like at what point if a company is growing and scaling, do they feel like they may be more of a full-time permanent COO support model?
20:16
Cameron Herold
Yeah.
20:16
Derek Fredrickson
Or a Fractional?
20:17
Cameron Herold
It’s usually when you get to about 40% of the week’s time is being used up by that person. You could probably leverage them enough to bring them on full time. So if they’re really working with you in the business two or three days a week, you’re ready for full time. You’ll find enough other leverage off their plate. Right.
20:36
Derek Fredrickson
Okay, got it. So before we switch off kind of COO stuff, I want to talk about your Vivid Vision, which I love the book, everything about that. Paint me the picture for the next five to 10 years, in your world, whether it’s how the COO role is going to continue to gain more visibility, gain more traction, gain more, I don’t say popularity, but like the second-in-command, like that didn’t exist so much 10-15 years ago. Now it’s quite, it’s expanding quite a bit. So what does it look like from your vantage point in the marketplace for second-in-commands and what do you think your part is with The COO Alliance? Like what’s your vision for The COO alliance over the next five to 10 years, longer term?
21:15
Cameron Herold
Well, mine is probably different from the industry and it’s probably more because of the stage of life I’m at as well, right. I’m not sitting here trying to look at, to build an empire when I just turned 60 years old and I’m enjoying, you know, where I am, and my role, my life.
21:28
Derek Fredrickson
Yeah.
21:29
Cameron Herold
Sheryl Sandberg was really the person who gave the COO title some visibility. Right. She was the adult in the room, the second-in-command to Mark Zuckerberg. I just had breakfast with her high school prom date this morning, which is really random. I just want to give more exposure to the role. Gino Wickman with Mark Winters with the book Traction and Rocket Fuel did a really good job with getting exposure to the term Integrator – what is really entrepreneurial small company, second-in-command. I disagree with a bunch of the stuff they said in their book, but they’ve certainly given some visibility to that as being a critical role in the company. I think now it’s time to elevate that role to what a true COO is or a true second-in-command is of a mid sized organization.
22:17
Cameron Herold
They did a good job with the true kind of minus less than 50 employee company. I’m more in the 50 to 500 employee zone as to what a true COO of a midsize company is. So it’s just giving them the skills and the connections and the confidence to do their role. So it’s me being on podcast, it’s me doing speaking events. It’s continuing to scale up The COO alliance. I just met with one of the key executives at YPO to see if we can do more with YPO and get more of their members putting their COO into the mastermind. It’s me working with lots of mastermind communities like Genius Network to get more of their members into The COO alliance.
22:53
Cameron Herold
I think it’s getting entrepreneurs that are members of communities like EO and YPO to recognize that their COO has to be in the community. And The COO alliance could be one of those communities.
23:08
Derek Fredrickson
Yeah, I think it is. I mean, I remember when I was in that group for a number of years, it was, and I still think it is the network for COOs, because there’s nothing else that exists like that. There are many entrepreneurial organizations, networking groups, masterminds, etcetera, because it’s needed it. But for COOs, they’re kind of like, they’re the backstage running the business and they’re backstage in terms of getting that kind of support to level up how they’re doing what they’re doing. So I think it’s great. I think it’s great what you’re doing.
23:34
Cameron Herold
That’s, I think why my book The Second In Command is taken off like it has too is it’s giving people the insights as to, you know, what is a second command, where do you find them, how do you hire them, how do you onboard them? It’s kind of giving them that script. And then I’m trying to share the expertise of all these COOs, of all these different bands with my podcast.
23:52
Derek Fredrickson
Yeah.
23:52
Cameron Herold
Just to kind of share that message.
23:54
Derek Fredrickson
No, I love it. I love it. So switch gears a little bit. If you could I’d love for you to share your story about Vivid Vision because it’s a fascinating story about a vision board versus or a mission statement for a company, what you believe in terms of a vivid vision, but also how it creates a really strong synergy between the CEO and the COO when they’re aligned on that vivid vision. So I’m going to kind of give you some open space to talk about that.
24:17
Cameron Herold
First off, there’s a funny story about the vision board. So the idea of a vision board got popularized in the movie The Secret. And it was a guy named John Assaraf who pulled out his vision board to show his son. It had a picture of the home they were actually living in. John and I are good friends. John Assaraf and I met a week after I left 1-800-gotjunk? and I went into their office and he was speaking there and he pulled out of his pocket a piece of paper with the name Cameron and my phone number. And someone had told him to meet me in Vancouver. So that’s where I met John Assaraf from the movie, The Secret, and really the guy who got the vision board idea.
24:50
Cameron Herold
The vision board is a whole bunch of pictures that mean something to the individual that when you put them all into this collage, it aligns you with your future and inspires you, helps you manifest. But if I showed a picture of like, you know, this room as an example, there’s one thing in this room that means something to me. What do you think it is?
25:12
Derek Fredrickson
It’s that painting, right?
25:14
Cameron Herold
Right. You would see the painting. But maybe for me it was the flowers beside it.
25:17
Derek Fredrickson
Right?
25:18
Cameron Herold
Well, you’re like, but why is the cow there? The cow didn’t mean anything. So a picture can say a thousand words. Yeah, but if I said something about a vase of flowers will always be around me, then that one sentence cannot be misconstrued. So I realized that a vision board was good for one person. But the concept of a vivid vision, you know, a four or five page description of what your company looks like, acts like and feels like in the future is a way to align all your customers, suppliers and employees so everybody can see what the entrepreneur can see. We got exposed to this concept 30 years ago at an EO event in Vancouver, Canada where 120 entrepreneurs were invited to a lunch with a high performance sports psychologist.
26:03
Cameron Herold
He was a Canadian Olympic team coach and he taught us how to use vision to align people and he taught us how vision aligned athletes but how we can use that inside of the business world. So that’s where the concept came from.
26:18
Derek Fredrickson
Okay, can you describe a little bit more about what… Give me an example of a vivid vision if you could, to kind of put it to real life form.
26:26
Cameron Herold
The best example I can give you before the business version is if anyone has ever built a home or done a kitchen renovation, they’re really the Visionary of that project. Right. You’re the homeowner, you know what home you want to get built, you know how you want it to flow. You know what you want the lighting to be like. Like, you know what you want the kitchen and bathroom to look like. But you probably don’t know how to do electrical, probably don’t know how to do plumbing. You’re probably terrible at hanging cabinets and doing flooring. But you can describe your vision. And then you go get a contractor, like a COO. Yeah. Who can.
26:59
Cameron Herold
Who can literally read your mind, and they can come up with the plans and the blueprints and the elevation drawings and the budget to make your vision come true.
27:09
Derek Fredrickson
Yeah.
27:09
Cameron Herold
And you sign off on plans and the budget, the contractor signs off on your vision, and then the contractor goes out and hires a bunch of employees and they build your dream home without ever talking to you. That idea was like, wow, if we could do that in business, that would be powerful.
27:24
Derek Fredrickson
Yeah.
27:25
Cameron Herold
So what we do is we get the entrepreneur to craft a four or five page description of what their company looks like, acts like, and feels like three years in the future.
27:36
Cameron Herold
And they describe maybe one paragraph about I.T., and one paragraph about sales, one paragraph about marketing, one about operations, about customers. They do a little paragraph about how your employees are living, the core values and how your meetings run and how you’re leveraging dashboards. They literally, almost as if you were walking around the business and describe everything of what it looks like. But they don’t know how to make it come true. Come true doesn’t describe how to do the electrical. They just describe the lighting.
28:07
Derek Fredrickson
Right.
28:08
Cameron Herold
Right. When you’re writing your vivid vision, you don’t describe how to do these things. You just describe them as they are. And then your leadership team will figure out what are the core projects to make every sentence come true.
28:20
Derek Fredrickson
Yeah.
28:20
Cameron Herold
And then the key is to do those projects in the right order. Right. Build the foundation, put in the walls, do the electrical and the plumbing, put in the drywall, paint. Right. But if you put the wrong things in the wrong order, your business falls apart.
28:33
Derek Fredrickson
Yep. I love that. Okay, that’s great. I think that’s interesting because it’s something that we talk about with the clients that we work with, because again, they’re coming to us and say, I want to grow, I want to scale, I want to 10x, I want to exit. Whatever it is, I say, great, we’re going to do those things with you as a Fractional COO. We’re going to focus on what you need to do. But more importantly, in some cases, it’s actually how you’re doing what you’re doing. That’s, in my opinion, the key to grow and scale. Because it’s not just the what that needs to happen, but it’s the structure, it’s the process, it’s the people. It’s everything that needs to be in the how in order for that to be realized. Do you agree with that to some extent?
29:08
Cameron Herold
Yes, but for me, it’s even. There’s even a layer below that which is the it’s kind of the why. If you think about Simon Sinek’s Golden Circles, we have the why, the how and the what.
29:18
Derek Fredrickson
Yeah.
29:19
Cameron Herold
Companies have to be very solid on their core values, their core purpose, their big hairy, audacious goal. They have to really explain the culture of the organization and kind of the history of how we got here. So everyone is indoctrinated in that cult. That becomes the foundational underpinnings of the company. And then you get all the people systems, right? Getting the right people into the organization, training the right people, onboarding the right people, aligning the right people, having everybody working on the right stuff, the leadership development of people, getting rid of the toxic underperformers and then all the how comes in. Right. The right meeting rhythms and the right software and how to do our job and the SOPs and all that stuff.
29:59
Cameron Herold
But if you have, if you have all of the right people with all the best SOPs and manuals and systems in place, but they’re not culturally aligned or they’re not living the core values, the whole thing falls apart.
30:12
Derek Fredrickson
Yeah.
30:13
Cameron Herold
Right.
30:13
Derek Fredrickson
Yeah. So there’s no direction to the bus. Right?
30:16
Cameron Herold
Right.
30:17
Derek Fredrickson
So we’re talking how the CEO-COO dynamic is really good. It’s really positive how it can help. In your experience. What are some of the pitfalls? What are some of the, like the blind spots where that can be a relationship that can be detrimental to the success and growth of a company. Like, where do you see some challenges in that dynamic between the founder, CEO and their second-in-command, be it a COO?
30:42
Cameron Herold
I talk about this in the book, The Second In Command, that it’s very similar to a traditional marriage. A traditional marriage of a husband and wife falls apart when the couple grows apart. The couple doesn’t play with each other and have fun together and hang out together. When the couple argues in front of the kids, when the couple argues in a dysfunctional way and not for the good of the marriage or the good of the family. So the CEO and COO need to be able to debate for the good of the vivid vision, debate of living the core values, debate for the.. Like, we have to look at the numbers, and the data and the facts and feelings, but not against each other.
31:23
Derek Fredrickson
Yeah.
31:24
Cameron Herold
Like arguing for the good of the company. And then they need time to get away from the rest of the kids, get away from the rest of the leadership team. Go for a run, go for drinks, go have fun, go play golf. To hang out with each other. So that you like each other. So that you communicate better and more effectively.
31:39
Derek Fredrickson
Yeah.
31:40
Cameron Herold
And then having each other’s back. Right. A dad can’t tell the kids. Oh, yeah, your mom’s a bitch. And your mom’s crazy. Whatever.
31:48
Derek Fredrickson
Unified front. Yeah.
31:49
Cameron Herold
Because then you’ve destroyed it. Right. Your dad’s an asshole. Your dad works too hard. Your dad’s grumpy. No. Talk to each other about that. But not in front of the kids.
31:58
Cameron Herold
So. So the CEO and COO need to be able to get away from the rest of the leadership team to go, hey, you were a jerk yesterday. Here’s what I thought. Here’s what…. So the COO has to be the brakes to the entrepreneur’s gas, but not the parking break. We need to be the leash to the entrepreneurial dragon to not choke them. And the CEO has to shine the spotlight on the COO to make them look good internally too.
32:20
Derek Fredrickson
Yeah.
32:20
Cameron Herold
So it’s getting a way to stay in sync. And then lastly, it’s giving each other some time to talk about stuff. Right. So that you’re always moving. Those are the core things that need to happen.
32:32
Derek Fredrickson
Yeah. Okay. I love it. The parent analogy, it’s perfect. It makes complete sense. I get it.
32:37
Cameron Herold
I was coaching a company in Vancouver, Canada, years ago. The CEO is now the mayor of Vancouver, Ken Sim, one of my very first coaching clients. Company blew up spectacularly. Like $100 million-$200 million in revenue now. It’s called Nurse Next Door. But I made the CEO and his COO go for date night. They chose to go to Starbucks every Tuesday at 11 o’clock. Just sit with their laptops and do work and just to chat with each other. And it was a really healthy thing that they needed.
33:03
Derek Fredrickson
Yeah. That trust component is huge. That’s why I often say with the clients we work with, you get a trusted second-in-command. I have a COO that I work with. You know, she helps run my company and we have a very good open positive. She’ll challenge me, she’ll push back, she’ll be the decision maker. In some cases where there’s a bit of like, should we do this or should we do that? So I trust her inherently which is a big component, because otherwise I could be in one direction and she could be in the other direction. And then we’re like that. Yeah.
33:27
Cameron Herold
And I didn’t. I didn’t mention that, but I talk about that in my book, the Second In Command. They really have to work at continually building trust with each other because it is critical. Like a mom and dad. The other part is that a shared, vivid vision of the company, that you’re both on the same page, you’re both helping to build. But if you don’t have that shared vision, then of course you’re going to start growing apart.
33:49
Derek Fredrickson
Yeah. Okay. Got it. Before we kind of wrap up, I want to go back to one of the books that you wrote, because I think it’s a great title. I know. I’m sure you could kind of very easily characterize what’s in the book, but “Meetings Suck”, like, what was the premise of that book? Why did you write that? What’s the idea behind it?
34:03
Cameron Herold
I probably should have called it something else. I probably should have called it, How to unsuck your meetings because I’ve had a lot of people go oh, yeah, meetings totally suck. I’m like, did you read it? No, but meetings suck. I’m like, no, it’s not all about that. It’s teaching you how to run highly effective meetings that don’t suck.
34:18
Derek Fredrickson
Yeah.
34:18
Cameron Herold
It’s trying to give you the systems and the tools to actually run highly effective meetings. In fact, when Elon Musk sent out that famous tweet about or text message about four years ago, five years ago, and he told all of his employees, if you’re ever in a terrible meeting or shitty meeting, stand up and leave the meeting. I sent him a text. His brother used to work for me. So I said, I sent Elon a text message. And I said, don’t tell your people to leave shitty meetings. Go back to first principles. Fix the meetings so that they’re never in shitty meetings.
34:46
Derek Fredrickson
Don’t have shitty meetings to begin with.
34:48
Cameron Herold
Yeah, Right. Then they don’t have to stand up and leave them.
34:50
Derek Fredrickson
Yeah, got it. Love it. For those that are listening, either as a founder, CEO or as a COO, so audiences both. Right. There are some people that are listening to this because they are improving themselves as a COO. And then there are others that are obviously founders and CEOs. What hasn’t been said? What is something that’s a Cameron gem, something that we haven’t talked about that you want to share with our audience before we wrap up for either audience or both.
35:15
Cameron Herold
Yeah. One is that you have to clearly clearly understand in the first 90 days that person’s coming in, what are the core outputs you want from them so that you start getting a very early ROI on your investment. That’s an important one. The second one is to not panic about the annual compensation for that person. So let’s say you’re gonna have a COO and it’s $300,000. You’re not giving them $300,000 tomorrow. Yeah, you’re giving them $23,000 a month for the next 12 months. So don’t, and don’t worry about $23,000. It’s only $11,500 in the first payroll period.
35:54
Derek Fredrickson
Yeah.
35:54
Cameron Herold
So then figure out for that $11,500 in the first two weeks what are the things that I can get them to do to generate at least $11,500 in gross margin so we’re break even and eventually. So they’re generating three or four or five times their pay in terms of incremental gross margin going forward. But if you don’t set them up for that success, then, then yeah, you’re going to go skidding sideways and then you’ve just added overhead. You’re not adding, you know, any incremental upside.
36:20
Derek Fredrickson
Yeah, that’s exactly how we do it. So when we work with a client, we do a 90 day focus to begin with which are, you know, what are typically five, call them projects, goals, ideas, rocks, things that are going to be above and beyond the day to day, realistic, but a bit of a stretch. But it’s going to pull the business into the, to the, a bigger future. And then the COO reverse engineers what needs to happen in the first month, the second month and the third month for that to happen or have really really good progress and momentum. And then the other thing we do, because I believe in the same idea which, everything through the filter of ROI, results and value.
36:50
Derek Fredrickson
So we do what we call a 21 day sprint, which are low hanging fruit, money on the table opportunities, unfinished projects, quick wins that give the founder bandwidth, but also confidence that there’s momentum so they can see that things are going to be moving forward.
37:04
Cameron Herold
Well and in addition to that, if they actually work on the low hanging fruit activities. I even talk about that in my book, The Second in Command. Anything that has a low P to A factor, projects that have a low pain in the ass factor. All of the employees and leadership team are like, oh yeah I like this guy or I like this woman. Because we just did three of their projects and they were easy, and they were easy wins and we got a result. So now the people start to know you and like you and trust you and then you’ve earned the ability to roll out the more complicated project later.
37:33
Derek Fredrickson
Yeah, there’s more of a runway, there’s more adoptability, they’re more onboard. They see it as a win for them, not just a win for the founder. And then, you know, cliche, rising tide lifts all boats.
37:42
Cameron Herold
There you go.
37:43
Derek Fredrickson
Cameron, excellent. Where can people find you to find out more about your books about The COO Alliance, about your operations course? Where can people find out about all things. Cameron Herald, the OG of the COO.
37:56
Cameron Herold
Yeah, and if they are a COO, we actually send a free copy, including shipping of the book that the Second in Command to any COO of companies. So if they just drop us a line, we can sign the copy. If they go to cameronHerald.com, it has links to all my books, the Second In Command podcast, The COO Alliance, my Investor Leaders training, it’s all there. My website is set up almost like a LinkTree, so it’s just really easy to find everything.
38:22
Derek Fredrickson
Cool. Well, thank you, Cameron. It was great to have you on the show. A lot of wisdom, a lot of knowledge and it’s great to see you. So thank you.
38:28
Cameron Herold
You as well. Thanks, Derek. Appreciate it.
38:30
Derek Fredrickson
All right, thanks, everybody. We’ll see you next time on the COO Solution podcast. Have a great day!
