9. Trust your people

Trust in people you need to trust insomething you might want to trust in systems you might want to trust insoftware, but consider for a minute trusting in people. First story. How didZappos build a shoe store that was worth a billion dollars. If you think aboutit, all Zappos does is sell shoes than anybody could sell at a pretty low priceonline.

[00:00:35] Just about anyone could haveopened an online shoe store, how to turn an online shoe store into somethingthat Amazon buys for a billion dollars. Well, the answer is that customerservice isn't an expense customer service is an asset. What Tony Shay. One ofthe founders of Zappos did, was he said to his customer service people, I'mgoing to measure how long you spend on the phone and how much it costs.

[00:01:05] And then he said somethingsurprising. He said, I want it to cost as much as possible. And I want you tostay on the phone for as long as possible. Every other company says this is anexpense. Customers are fungible process of get them over with Tony said, wait aminute. By the time someone is calling our customer service line, they'realready a customer.

[00:01:28] They have a problem. They'reraising their hand. They're eager to talk to us. I think the record is an eighthour long phone call. One of my favorite stories is the one about a woman whosemom passed away and she got to her mother's former home. And like some peoplewho are getting on in years, she had been hoarding things and buying things shedidn't need.

[00:01:52] And this woman found that hermother had bought dozens and dozens of pairs of shoes from Zappos over theyears, and never even opened the boxes. It was long past time to return theshoes, but the woman called Zappos. And when she told the person on the phone,what had happened first, she got a willing ear.

[00:02:14] She got a smile. She got avirtual hug on the phone. Then the person who Zappa said, we're going to send amessenger to your house tomorrow. Just take all the boxes and put them in thebox. We send you we'll take care of it. We know you're in morning. You don'thave to do anything. And then the florist showed up.

[00:02:36] There's a bouquet of flowers forthis woman and her loss. And so the question is isn't that a good reason to opena shoe store? Isn't that a great opportunity to connect with people in a waythat matters. If you want to be really profit oriented about it, isn't that waycheaper than running an ad. Cause I heard this story from someone who heardthis story from someone who heard the story.

[00:03:02] The fact is that because Zapposdecided. To like its customers engage with its customers and trust itscustomers. They got back far more than they put into their customer servicebudget.

[00:03:19] And we continue. What about allthose emails you've been sending out? Maybe you do an email blast. Maybe youhave a list. Maybe that list, all those email addresses you've collected orbought or traded or sold or whatever. Maybe that list is just a number to you.Send out a thousand emails, get three orders, send out a hundred thousandpitches.

[00:03:40] Maybe get a meeting, wait aminute. The people on that list are people they're not just email addresses.And if you treat the email addresses on that list, like they're nothing butdata. Why should you be surprised that the people you're emailing don't actlike anything, but data that what we have is a chance for the first time in thehistory of the world, to reach out to large numbers of people who want to hearfrom us to deliver anticipated personal and relevant messages to people whowant to get them well, we have the chance to do for the first time at scale istreat different people differently.

[00:04:23] That was impossible. 50 yearsago that one of the inventors of the price tag was Macy's. They invented theprice tag because they couldn't trust their clerks to bargain with people aboutwhat this should cost or what that should cost. And Macy's a department store,a giant, giant building where there's something for everyone, but everyone hasto choose from the same things.

[00:04:46] That's not true online anymore.If you realize that the internet is not a mass marketing system, it's bad atthat, but that it's a micro marketing system. Then what you have is the chanceto find that smallest, viable audience. So it's people who share hopes anddreams and serve them. And if there's a second audience serve them differentlythan what we get the chance to do is truly have people opt in.

[00:05:13] To decide to build somethingthat people would miss. If we were gone and too often, that's not what happenstoo often. Entrepreneurs want customers to solve their problem. How am I gonnamake my first quarter numbers? How am I going to make a profit? How am I goingto sell this thing? I need customers to solve my problem.

[00:05:31] But every once in a while, anentrepreneur shows up and realizes that, wait a minute. I can solve theirproblems. If you're on the hook to sell someone else's problem, it changeseverything. What does it mean if someone comes to you as a customer and youhave a competitor who can solve their problem better than you can, you need tosend them to your competitor because I thought you were in the business ofsolving their problem.

[00:05:57] This posture shift is trulyprofound because what it means is you can get back to what probably motivatedyou to do this in the first place, which is service, which is the idea ofpractical empathy, realizing that other people don't want what you want, seewhat you see need, what you need. And that's okay.

[00:06:17] But if you go to them, asopposed to insisting that they come to you and you figure out how to watch andlisten, you can learn to see. And once you learn to see, then you will be seen.

[00:06:34] And what about your employees?Your employees are people too. It's possible to build an entrepreneurial entitywith no employees whatsoever. It is possible. To start a business where youhave average employees earning below average wages, in which simply throughyour magic and force of will you create an enormous amount of value, but bothof those things are really unlikely.

[00:06:59] What is far more likely is thatthe people you hire will determine. The company you build and the people youhire have options to have options, to work for other organizations, biggerones, smaller ones to work on their own. They have the option of being afreelancer. So if we look at the gig economy, businesses like Uber, that raceto the bottom and say, we'll take any employee.

[00:07:25] As long as they meet ourrequirements, end up building something that might be big. But it could havebeen better because the opportunity is to realize that we don't want to build ajob that can be done by the cheapest available person. Because if every job inthe entire organization can be filled by the cheapest available person, that'sthe sort of organization we end up with.

[00:07:50] The alternative is to look for alinchpin. Somebody that would be hard. To live without somebody who doesn'tnecessarily become a square peg in a square hole, but instead brings uniquepersonality and skills and passion to the job. What does the receptionist do atthe old fashioned office? Well, what this person used to do is make sure badguys don't come in, maybe offer a cup of coffee.

[00:08:19] But what would the world bestreceptionist do? This person we'd know the calendar of everyone who was coming.They would create a hospitable environment. They would figure out how to makethe person who was coming, be in a better mood than they were before they gotthere, which makes it way more likely, they'll say yes to whatever deal is onthe table.

[00:08:40] Way more likely they'll bringpositive energy to that meeting. They came to this simple job. Isn't so simple.Not if you're willing to commit to somebody who is going to be a contributor,but we can go down the list and do this forever. Every one of the jobs in theorganization, you're hoping to build, instead of saying, I'm going to build ateam that will never cause me to lose sleep because I can replace any of themat a moment's notice.

[00:09:09] You could say, I'm going tobuild a team that I am dependent on and I'm going to live my life as if I amthat we're going to build an organization where it is the reflection of our passionsand talents.

[00:09:28] One more is APOE story for you.As Tony was building the business, they were hiring a lot of people. Once yougot hired, there was a two week training program. That's expensive. You gotpaid for two weeks while they trained you. And at the end of the trainingprogram, they decided who they wanted to keep for the long haul.

[00:09:45] But before they did that, theysat the employee down and they said to this person here here's $2,000. Maybe itwas $3,000. Here's a lot of money. You can have it. If you quit today. This iscrazy. Isn't it paying the best people they've recruited and trained thousandsof dollars to quit. Why would they do that?

[00:10:09] Well, it's pretty simple. Whenyou think about it, if someone's willing, after they've learned about theinside Zappos to walk out that door for just a couple thousand bucks, you don'twant them. The people you want are the people who are on the journey to peoplewho have made a commitment to people who see what you see and want to go whereyou are going, because that commitment is what you need internally at the verysame time that the modern world lets us take so much of our work and make itexternal.

[00:10:45] The other factor here is that itis easier than ever to outsource the work. If you're doing your owntranslation, that's a mistake because the translation service can do it for youand half the time and twice as well. If you can outsource it, you probablyshould, because unless you're going to make it better by doing it, in-house,you're distracting you and your team from the real work.

[00:11:08] The real work is the work onlyyou can do. Only the way you can do it. And so this new hybrid organization iscoming down the pike, there's outsourced work, there's artificial intelligence,there's all that stuff that's getting done automatically. And then right in thecenter of it, the core of the entire operation is that group of people whofigure out how to bring something remarkable to the work that they are doing.

[00:11:35] And that's up to you early inthe process. And if you didn't start your business this week, it's not too lateto make decisions about what it is to work in a studio. Peer-to-peer peoplespeaking up, owning their choices, figuring out how to make things better allaround them. Even if technically quote, it's not their job.

[00:11:55] The old model of industrialismis. The owner tries to get as much from the workers as they possibly can andpay as little as possible. And in return, the workers try to get away withdoing as little as possible, because if they don't, they're just going to gettaken advantage of, but in the new work, in the work of creativity andimagination and possibility.

[00:12:17] None of that makes sense. Whatmakes sense instead is to figure out who are the special people with a specialattitude and a special posture. They're going to change how your organizationdevelops

[00:12:34] the next part of this. It's hardto do all of this. If you're trying to be average, average has another name.Mass mass means. Most people, most people by definition are average. Mass isnot your friend, masses, no entrepreneurs friend. It is really unlikely thatyou will build anything bigger than Starbucks and Starbucks only serves a tinyportion of the population.

[00:13:04] My books have sold millions ofcopies. And yet more than 95% of the people in the United States have not onlynever read one of my books, they probably have never even heard of me. And thatis fine. It's fine because you don't want to be a wandering generality asdelayed Zig Ziglar used to say you want it to be a meaningful, specific.

[00:13:28] What it means to be a meaningfulspecific is to be peculiar, to be weird, to be an edge case, to be special, tobe someone we would miss, if you were gone and to do that with all thepressures that are on you is difficult, indeed, because your investors want youto be right in the middle. Cause they want you to be big and your employeesdon't want you to lean too close to an edge because they want to feel safe andthe customers don't get the joke.

[00:13:56] The customers who didn't come toyou for peculiar, but just came because you were convenient and we're hopingfor average, they're not going to be shy about speaking up, but guess what?It's not for them. If someone was hoping that you would race to the bottom forthem to be the cheapest easily replaceable, you need to say, I'm sorry.

[00:14:16] I'm not for you because theproblem with the race to the bottom is that you might win or worse. Come in second.The alternative is to race to the top. And you can only do that by being human.You cannot out system Google, you cannot out industrialized general electric.It's not available to you. What's available to you.

[00:14:40] Is the chance to be more human.The biggest advantage or organization has over the big guys is simple. The CEOis in the room. CEO and founder is listening. The CEO is ready to change thingswith alacrity, with grace, with flair, because you can see the others.

[00:15:07] I'm not proposing a fully custombusiness. If you want to be in the custom business, I think that's fine. If youwant to be a custom architect or a custom Baker, that's fine, but you need tocharge appropriately custom work. And demand should cost many times more thanmass work. If that's your business, make that your business and be more customthan anyone else.

[00:15:30] All dreams satisfied within acertain range. But if you're not custom, you need to have boundaries. We servethese people with those problems. We don't do this and we don't do that. And itdoesn't really matter. If business is slow, when business gets slower, it mightbe a sign you're encountering the depth and the depth as we know is real.

[00:15:52] But the answer is not to go raceafter different, early adopter to go run away from this dip toward a differentone. The answer is to realize you set out to be on this journey a while ago,and the journey is going to continue and it's going to be funded and built andpowered by humans. People with real needs who are not cogs in your machine ortheirs.

[00:16:16] Then when you become a cog inthe industrial system, you might profit for a little while, but soon you willbe replaced by somebody else. Who's an even more willing cog than you are. Thechance instead is to build your own system, to build your own network, tosupport people in community, to make it so they're insiders and outsiders thatwhat you are doing as an entrepreneur is you are leading a circle, a tribe.

[00:16:42] If you want to call them thatpeople who are aligned in the way they go through the world who have ashorthand who understand that people like us, not how we look, but how webelieve and how we act. People like us. We do things like this and your job isto establish what things like this are, make a list, make a list right now ofcompanies that you view as heroes, as companies you view as models, as homerunsas companies you'd like to aspire to be like, you got the list.

[00:17:13] I'm guessing. And nobody on thatlist is about racing to the bottom. There no brand, no organization on thatlist is on it because they're the cheapest or the most brutal or a monopoly.That's not what we set out to do. Or we set out to do is make a difference tomake things better by making better things.

[00:17:33] So the sign on your walk andsay, when in doubt, be more human, that problem that's in front of you. If youdidn't have to hide behind the fact that there's a company and you're thefounder, and you could just solve that problem as a human, what would you dothat customer who's in front of you? The one who doesn't understand.

[00:17:53] How can you help themunderstand? How can you write to people? How can you earn permission? How canyou tell stories that resonate with people at a human level? Because the bigguys they're stealing the industrial level, they're stealing. Uh, we have apolicy against that level. What's left for the rest of us is the chance to leaninto the idea that we can treat people the way we'd like to be treated.

[00:18:19] And we can build somethingbigger than ourselves. But we can be proud of it because we're making thingsbetter. I don't think that's a rant. I think it's actually the roadmap that somany entrepreneurs need to be specific, to be meaningful, to be peculiar, tolisten, to learn, to see. And then once you understand the system to get betterat.