Mark: Today on PowerTips Unscripted, we talked to Wayne Rivers of the Family Business Institute. Well, we kind of talk to him. He’ll talk to us. We’re going to explain in just a second.

Victoria: Hi, I’m Victoria Downing and welcome to PowerTips Unscripted, where we talk about tips, tactics and techniques to help you build a strong, profitable remodeling company. And I’m here with my co-host, Mark Harari.

Mark: You sure.

Victoria: Are. Hey, how you doing, Mark?

Mark: I’m doing pretty good. How are you?

Victoria: Good. Even better, because we have just come off of two days of serious strategic business thinking around tables.

Mark: Yeah, our our meeting, our.

Victoria: Semiannual two days and do nothing but work in on the business. It was.

Mark: Incredible. Yeah. We we walk the walk. We don’t just talk the talk. So even though we provide peer group and roundtables program, we go to a roundtables meeting for roundtables. Companies, companies.

Victoria: To do roundtables for different. And Wayne Rivers, who we are going to be hearing from today, is another one of the members of this really great group of very smart businesspeople.

Mark: Super smart people. I get so I mean, my head is spinning from all this stuff. We’re coming back away from that. And it’s always great because it’s great for our members, because we learn from our peers, we learn what they’re doing with their membership, what they’re doing with their program, and we try to pick the items that will help us improve how we do what we do.

Mark: Yes, and it’s a great thing. We wanted to have Wayne actually wanted to have Wayne. We wanted to have Scott. We wanted to have Julian. We wanted to have Steve. We wanted to have everybody on the show. But unfortunately, they can’t just hang around for a week and talk to us, so we’ll have to have them on in the very near future.

Mark: But in the spirit of that, Wayne with the Family Business Institute does a great, video blog that he puts out, and he had an episode that really I thought was was a good one. So what I wanted to do this week was, let’s listen to this episode. It’s not long. It’s a seven minute episode. He’s brilliant as usual.

Mark: And, and I think it’s going to be really helpful to our listeners. So you want to want to take a listen? Sure.

Victoria: Yes. Let’s do let’s.

Mark: Listen to this. It’s a good one.

Wayne: Hello, this is Wayne Rivers at the Family Business Institute. As always. Thank you for tuning in. This week, I want to talk about the fact that what leaders don’t do is just about as important as what they actually do as leaders. Is it? Why? Why is this important? I want to talk about something that you’ve heard me talk about before.

Wayne: So I suppose, and that is that leaders seem to tolerate bad behavior in their organizations, sometimes from family members, but just as often from non-family employees. And the reason this is important is because that costs you. It costs your organization. There’s hardly costs. There’s opportunity cost for tolerating these bad behaviors. And finally, bad behaviors in so many ways limit your organization and constrain your culture.

Wayne: And so I want to get to some of these things. So we learn from our members in our peer groups. And we were we had a great. And I’m going to I’m going to mess this up. I know I can’t remember what member actually gave this quote to Dennis. I can’t remember which peer group it was, but here it is.

Wayne: And it’s really profound. The culture of any organization is shaped by the worst behavior. The leader is willing to tolerate the culture of any organization shaped by the worst behavior the leader is willing to tolerate. And this comes from Grunter and Whitaker. That’s the source of the quote. And how can you not agree with that? It is so true.

Wayne: And the story came out in this peer group. But this is what happened. And I know you can relate to this, because I know this has happened to you at one time or another during your business life. But in this case, there’s a 30 year superintendent. He was awful to work with. He was a hoarder of resources of the company.

Wayne: He actually got caught stealing. And his son who worked there got caught stealing to. And there was like some discussion about what to do. Why would anybody want to keep an employee? A toxic employee stole from the company around. And I know you’re thinking, oh, this, this, this business owner must have been a real idiot to keep somebody like that around.

Wayne: But you’ve done it, too. And one way or another, in one degree or another. And so why do people put up with abhorrent behavior? I think there’s six specific reasons. The first is a rationalization. Oh, he makes money on his jobs. He’s a he’s hard to work with, impossible to work with, no people skills, no kindness, no no milk of human kindness in his heart.

Wayne: And yet he makes money on his jobs. That’s why we keep him around. The second one is, oh, I know him. I know his family. It would break my heart. I know his sister. I go to church with her. They would break my heart if I let him go. And I had to look at the sister at church every Sunday.

Wayne: The third one. I can’t let the guy go. He’s contributed so much to our company’s success over the years. Right. How much does he really cost you? Is the question you should be asking. The, fourth one is, no formal reviews. So there’s there’s really no arena, no theater to be able to get with your employees and discuss performance and improvement and things like that in a win win situation.

Wayne: And so the person may be toxic but not even know that they’re particularly toxic. Although I bet he knew that he was stealing. I don’t know how he could not do that. The fifth reason is this definition of stewardship. I’m gonna have a little story here. Take me a minute. I was playing tennis with a methodist minister one day, and we finished up, and he said, I’m not looking forward to going back to my church this afternoon, because I’m going to have to let the three ladies in the office go.

Wayne: And and I learned about employee stewardship from you guys. I learned that you never let anybody go. You rehabilitate them, you you reeducate them, you give them a chance after chance after chance. And I said, Bruce, what about your stewardship responsibility? And he looked at me in the strangest way you can imagine. Now, this is a methodist minister.

Wayne: He knows stewardship. And he said to me, Wayne, the Methodist Church has limited resources, and I would be a poor steward of those resources and my congregation if I didn’t let these three ladies go. They lot time had passed them by. They couldn’t operate computers, all that kind of stuff. Lots of reasons why I had to do it.

Wayne: But he turned my and your definition of stewardship upside down. His stewardship was to the larger church and the larger congregation, not to these three individuals. Your stewardship is not to one person on your payroll. Your stewardship is to yourself and your family and your entire business. One person should not be allowed to hold you and your organization back.

Wayne: And that’s my story. And the reason is that people don’t let toxic employees go is they don’t have a great system for getting new employees on the bus. So they’re afraid if they let you know Johnny go, they won’t be able to replace Johnny with anybody at all in today’s world, or they won’t be able to replace him with somebody that’s competent.

Wayne: And that’s because they don’t have a great system for recruiting and attracting talent to the organization. So those are the six reasons people keep toxic people around. Now, what have you. What do you do if I’ve if I’ve run your bill and I’ve kicked you in the shins here, what do you do if you have a toxic person around or somebody that’s just not fitting with today’s culture that you want to have in your organization, the first thing is you’ve got to develop a spine.

Wayne: One thing that I’ve seen in our peer groups, my peer group personally, as well as our the peer groups that we run, is that the peer groups help people develop spine. And they say, you have got to let this person go. And guess what? It happens, it happens. And everybody breathed a sigh of relief and go. They say, oh gosh, why didn’t you do that six months ago or six years ago?

Wayne: So it’s it’s really a great thing to have a community that helps you make difficult. And that’s the most difficult business decision, letting people go. That’s just heart wrenching. Even if the person is toxic, it’s still heart wrenching. Nobody likes to do that. It’s the worst thing a leader has to do. But you’ve got to do it.

Wayne: And the third thing is for people that aren’t toxic but maybe have a chance for rehabilitation, you’ve got to give them an improve or remove scheduled. You’ve got to give them things. They have to stop doing things. They have to start doing specific measurements, metrics that they need to meet to keep their jobs. And you just have to make it clear for them.

Wayne: Some people are plagued by lack of clarity. If you make it crystal clear, these are the targets you have to hit, then it makes life simple. If they don’t hit the targets, they know that, that it’s time to move on. All right. The quote is this the culture of any organization is shaped by the worst behavior. The leader is willing to talk or tolerate you is the leaders.

Wayne: What are you tolerating that you shouldn’t? And now the bigger question. What are you going to do about it? Love to have your comments on this one. Thank you. This is Wayne Rivers at the Family Business Institute.

Victoria: Wow. That, really strikes, doesn’t it?

Mark: A little bit, right?

Victoria: Oh, my God.

Mark: He’s he’s so great.

Victoria: But, you know, one of the things obviously I could hear myself in that in that episode for sure, but I loved that he brought up the fact that the peer groups help you get a spine, because that’s exactly what they did for me. Yeah. At the last meeting, they made me get a spine. I had to commit to something.

Victoria: It was very challenging, but I did it. And it was it was hard, but it really made the difference because I wasn’t going to go back there and report to them that I didn’t do it when I knew it was the right thing to do, and I was just didn’t have the spine.

Mark: Yeah, it’s so true that if it’s I mean, it goes back to accountability when you have to answer to someone and be accountable for your actions. And it’s hard for any business owner because typically you’re the top of the pyramid. So there’s no one to be accountable to. But the peer group kind of forces that accountability to the to your peers.

Mark: And they definitely do give you the spine, which is a huge piece of that puzzle.

Victoria: You know, another thing that I was thinking of when I was listening to Wayne, is the concept that I think that there are business owners out there who so don’t want to have to say the tough stuff that they will develop systems that will, quote unquote, punish everybody for one employee’s bad behavior. You know, because they just don’t want to address that one person.

Mark: Right. Well, and it was such an insightful quote that he got from his, his member that your company’s culture, it’s kind of a play off of like a chain is as strong as its weakest link. You know, it’s that lowest bar that you allow happen is going to dictate the culture of the company. And, you need to raise that bar a little bit or else you’re going to have a mess on your hands.

Mark: Yeah, it was really good stuff. I wish we actually had him on so we could pick his brain a little bit about it. But I, you know, he’s such a great speaker and such a smart guy. I really wanted to share that episode with our listeners.

Victoria: No, I’m great choice.

Wayne: Great choices.

Mark: Good stuff. We want to thank Wayne for letting us share that episode. And if you liked what he had to say, you should totally check out his YouTube channel, the Family Business Institute. Channel. He’s got all kinds of great, great content on there. And we’ll put a link to the to the channel in the in the show notes, which you can find at PowerTips podcast.com.

Mark: Thanks for being here as always. I am Mark Harari.

Victoria: And I’m Victoria Downing. See you next week.