Business coach and successful entrepreneur Bill Flynn of Catalyst Growth Advisors provides powerful insights drawn from personal experience and consulting with hundreds of businesses. In this episode, he shares that understanding your customer’s pain points is key to your success. Plus three keys to unlocking growth and the primary reason established businesses fail.
I’ve helped lead several start-ups and I was privileged to be part of some great teams. Primarily my focus was on the sales and marketing end of the business. I had a lot of success early on in my career which helped to build the foundation I use today as a business coach. I love what I do and only wish I would have started my coaching business sooner.
The formula I use won’t tell you how to be successful but it will show you if you can be successful. And it provides you the answer more quickly, using fewer resources. First off you need to fall in love with the problem you want to solve and the customers that you will help, get to know them and understand their pain points. Secondly don’t ever run out of cash. Those are the primary two problems as a founder or founding team you should worry about.
Regardless of your type of business, we often think we know why our customers choose us, and often we’re wrong. This is why understanding your customer is key to your success. There is a theory called Jobs-To-Be-Done that applies here, which is what is the job people are hiring you to do for them.
The facts are that most businesses fail, so when I wrote my book Further, Faster I studied those businesses the have survived and thrived. I found that there are a few things that successful business owners do well. The three main things you need to do well is to understand performance is a team sport, you have to build a system for your business, and you have to use cash as your financial growth metric.
What I’ve learned is that most businesses that are run well aren’t run by the leader. Rather they’ve created an environment for other people to be able to run the business well. Because the leader realizes their true job is to predict the future of the business, not run the day-to-day operations.
It’s not your customers' job to tell you what products or services they need. It’s your job to understand your customers' pain points and create products that solve those needs.
Resources Shared:
Bill Flynn:
You should fall in love with the problem and the customer. If you fall in love with the problem and it's something that really drives you, you've got to have this sort of passion, because startups are really hard and there are going to be days and weeks and months that just suck. If you're not really committed to really making this thing happen and gets you up and juiced every day, then you're much less likely to continue to do it. That's the first thing I say, is just fall in love with the problem and the customer. Get to know them. Really understand their struggles. The second thing is don't ever run out of cash. Those are the only two problems that I think as a founder or a founding team I really have to worry about. Values and all that kind of stuff is great, I love that stuff, but I would make it secondary to those two things.
Gordon Henry:
Hello. This is Gordon Henry at Winning on Main Street. This week, we have a terrific guest, Bill Flynn, an entrepreneur turned business coach, who will be discussing some of his coaching principles, which you could find in his book Further, Faster. Welcome, Bill.
Bill Flynn:
Hey, Gordon. Thanks for having me on. I'm looking forward to the conversation.
Gordon Henry:
Great to have you, Bill. You have a tremendous amount of great advice for entrepreneurs that we'll get into in a minute, but I'd like to begin kind of at the beginning of your entrepreneurial journey. You have an incredible background. You ran something like 10 startups in 25 years, nearly all of which got sold or went public, which seems incredible, the batting average. Can you kind of walk us through it?
Bill Flynn:
Sure. Well, first is I didn't run them all myself. I helped to run them, to give credit to others, so it's definitely a team of us. I was generally, most of the time was on the sort of sales and marketing side. So I would consider that the more difficult side of most businesses that are startups, but still there were certainly a bunch of people that surrounded me. I got into it in really sort of I'd say 1991, and just loved it, especially '95, I joined my first internet startup and it's just so much fun. It was called Open Market, which at the time was pretty well known. We were called the Netscape of the East. We had one of those crazy stories where I think we had four or five million dollars in revenue, we went public, not profitable at all, was valued at several billion dollars or something crazy like that.
Bill Flynn:
I had a whole bunch of those. That's my background. I just tried to stay with the team as much as possible. I did four with the same team and that was my best track record. I was three for four there. Then I sort of went off on my own. I had another one that I would consider a win. And then the last four were actually difficult. It's funny, I sort of did it backward. I got really lucky at the beginning, and then my last four were not very successful. Either they're out of business now or they completely went to another platform or an idea which was too bad, because by that time I had learned so much about how to really make it work, but I couldn't get the founders to buy in or really buy in, so they floundered.
Bill Flynn:
Then I decided to become a coach about four or five years ago. That was the best decision I've ever made. The only regret is most of the time for us, our regrets are the things that we didn't do. I should've done it sooner. I now know what a calling is. I love what I do, time flies when I do it. It's such a blast. So I plan to do this for as long as I can.
Gordon Henry:
That's great. So it sounds like you had a lot of key learnings about what made some of the startups successful and maybe some of them not so successful. What were the key learnings, and is there a formula for making a successful startup?
Bill Flynn:
Well, there's a formula, but it doesn't mean you're going to be successful. It just means that you'll figure out whether you can be successful or not more quickly, and with less resources. It really derives itself mostly from Steve Blank, who's considered the godfather of startups. He's now a professor at UC Berkeley. He's written a bunch of books. For those of you who are interested, do not read any of his books. He writes like a professor. It's a horrible read, but he's great to listen to. He's got a great personality and he has some great lessons.
Bill Flynn:
In the end, he sort of says two or three things. I'm using him as an example, but I've also sort of taken my own experience, is first is you should fall in love with the problem and the customer. If you fall in love with the problem and it's something that really drives you, you've got to have this sort of passion, because startups are really hard. There are going to be days and weeks and months that just suck. If you're not really committed to really making this thing happen, it gets you up and juiced every day, then you're much less likely to continue to do it. That's one of the reasons I think most businesses fail. So that's the first thing I say, is just fall in love with the problem and the customer, get to know them, really understand their struggles. Don't try to sell them on your idea. When you talk to them, act like you're a journalist and you're just trying to understand the story and uncover it. If you find that you find a good story and you can't disprove your theory, your hypothesis, then you're probably onto something. You sort of apply the scientific method as well.
Bill Flynn:
The second thing is don't ever run out of cash. Those are the only two problems that I think as a founder or founding team, I really have to worry about. Values and all this kind of stuff are great. I love that stuff, but I would make it secondary to those two things. Once you get going, once you get through that knothole, then you can revisit values and all that kind of stuff and make sure you're there. I do say that you have to go back to all the key decisions that you made when you were a startup, in startup mode, prior to what some call product market fit, and revisit those key decisions to make sure that they're still the right moving forward. Because often, I don't know if you've done any startups, Gordon, or you know anyone, you make these crazy decisions because you have to survive or you're just trying stuff.
Bill Flynn:
If you keep that mentality going forward as you're driving ethos, it can send you in crazy directions, because most founders think they can do anything. They probably can, especially in the startup world. There's a phrase called SMOP, which is just a small matter of programming. We can do anything you want. The problem is you shouldn't be doing anything you want. You should be doing something that's very specific, very focused and get really, really good at it. Most really great businesses as they get through that knothole are really, really good at what they do. Those are the two things I would say. Don't fall in love with the idea, fall in love with the problem, and then don't run out of cash.
Gordon Henry:
Now, most of our listeners are small to medium sized businesses that handle what I would call everyday problems: plumbers, electricians, roofers, people who work in home services. We have a fair number of doctors, dentists, lawyers. So these are not people who are trying to solve some new, never thought of problem. They're just trying to run a successful business, often in their home town. Is that type of startup different than the startups that you worked with in the technology space?
Bill Flynn:
Not really. So we often think that we know why people come to us, and we're very often wrong. I would apply the same principles, which is really understanding your customer. So you got through the knothole or whatever or you started with a business that it's not really a startup really, it's you're just launching a business. I launched my own business here. I'm not a startup. I'm a coach, and there are millions of coaches around the world. I just sort of follow that formula. But what I do is I said, "Who is my best customer?" You mentioned dentists and doctor's offices. There's something called design theory or design thinking. If you apply that to your business, I think you're better off. That's generally what you do as a startup. That's basically understanding the environment, understand your customer. Understand the outcome that you're trying to reach and then work backwards from there.
Bill Flynn:
There was a story I read years ago about a doctor's office, and they had a designer that came in, and it was a pediatric office. What they did is they designed the office originally for adults, but their customers we kids, so the designer came in and he or she, I can't remember if it was a woman or a man, got on their knees and they sort of walked around on their knees to get the perspective of a child. They designed the office that way so you weren't staring up at a big desk or whatever. It was sort of at that world. The parents love it because you were thinking about their kid and their business got better and better and better. They got recommended by others.
Bill Flynn:
It's the same process, you're looking at it differently. There's a theory called jobs to be done, which I think would apply to that. What is the job that people really hire you to do for them? Yeah, maybe it's to give shots and keep your kid healthy, but that's not the entire job. They want you to make your kid feel safe and you want them to feel welcome. They're scared because they're going into an environment where they don't know anything and they have to trust this doctor, so you have to create that environment for them. Then you've solved their problem. They've solved the whole job that they hired you to do as opposed to one thing. I'm a huge fan of jobs to be done.
Bill Flynn:
Those of you who don't know what it is, it's a theory that's been around for about 30 years. There's an argument on who started it. I don't really care. Clayton Christensen, who's a Harvard business professor, is the one who sort of popularized it. I'd say he's the Paul to the Jesus of the movement if you will. He was the promoter of it and the biggest name, but there are a couple of other guys. My favorite is Bob Mesta. I highly recommend if you haven't read his book, Demand Side Sales 101, read it. It just digs really deeply into this whole process. It gives wonderful examples of things you know like Snickers bars and Casper mattress and all that kind of stuff, of how this really works. That's what I'd say to those folks. By the way, my dad was a pipefitter, so I'm right there with the plumbers, electricians, all the trades. I've lived it as a child anyway.
Gordon Henry:
Yeah. Essential services. So I'd like to turn to what you're doing now, and specifically some of the thinking in the book you wrote. So you're now a business coach, as you mentioned, you wrote a book called Further, Faster. It really, I think, describes your thinking about what businesses need to do or entrepreneurs need to do. You have built a course on really how to grow a business, and you talk about taking the guesswork out of growth. Can you explain kind of what that means and what's your formula?
Bill Flynn:
Yeah. So I'm going to back up a little bit, Gordon. Most businesses fail. There's some great stats out there, I think it's the Small Business Administration and the Bureau of Labor Statistics, I think it's called. They pretty much line up, which is you have about a 50% chance of making it five years, and then you have about a 25% chance of making it 15 and about a 16% chance of making 25. So the longer you're in business, the less likely you are to stay in business. I think when people start businesses, they generally aren't thinking... few of them are going to say, "Well, I'm going to do this for four or five years and flip it." They want to probably do this either as a lifestyle or they want to grow it to a big thing. I'm sure people make that decision and they get bought or whatever, but those stats are pretty staggering.
Bill Flynn:
But what's not mentioned in those stats is those are just the ones that died. That's almost better because it's over. There is a very large percentage of the people who didn't die who are just struggling every single day. Very, very few thrive. So what I've done and what I did in my book was I studied success. I said, "So what about these businesses that have survived and thrived? Is there any sort of commonality among them?" I'm sort of a mini Jim Collins, right?
Bill Flynn:
I didn't go quite to his depths, but I read a lot of books, I read a lot of things. I talked to a lot of folks, and I found that there are just a few things that business leaders do really well, and it's embodied in the gentleman by the name of Alan Mulally. A lot of people don't know who he is.
Gordon Henry:
Yeah. Former CEO of... Yeah, go ahead.
Bill Flynn:
Yeah. You know who he is, right? Yeah. CEO of Ford. He was also the CEO of Boeing Commercial Aircraft. I would say he's probably the best leader we've had in a century. What's really interesting is most people don't know who he is because he's just a humble guy. He didn't want to be in front of a camera. He wasn't a superstar CEO, like Jobs or Musk or whatever, it just wasn't his thing. He just wanted to get the job done. There's this great book about his journey at Ford called American Icon. It tells a great story about what he did and how he did it. He did a few things really well, and they really line up well with my premise, which is there are three main things that you have to do as a leader.
Bill Flynn:
You have to understand that performance is a team sport. It's very rare that you'll have these wonderful lone wolves who get things done over a long period of time. Maybe it'll work for a short period of time, but over a long period of time, it doesn't work. And I think Steve Jobs is an excellent example of that. When he first did it, he tried to be the lone wolf. He tried to be the smartest guy in the room and do everything, and then he failed. He got kicked out of his company and he learned a lot of lessons at the end of that. Then when he was at NeXT. He came back and he was a different kind of leader, he applied that a little differently.
Bill Flynn:
Al Mulally had three things that he did, or four things really, which I build on into three. Performance is a team sport. You have to build a system is the second thing. A business is basically one big system. It's made up typically of a number of smaller subsystems, so I think your plumbers, electricians, et cetera will get this. My dad was a refrigeration mechanic and he put in big stores, like Whole Foods and Stop & Shops here in the East. The store was one big system, but it was made up of a number of smaller systems, from refrigeration to electric to the construction side of it, all of that, and they had to work well together. You have to understand that is a business. If you want it to scale, you have to have some repeatability to what you do and some predictability.
Bill Flynn:
Lastly, if you want to grow and you want to grow larger, it doesn't have to be billions of dollars, but certainly you want to grow larger, you have to use cash as your financial growth metric. Why? Because growth costs money, and generally it costs money in front of growth. You have to be a pretty good guesser and you have to invest wisely. You have to have the money. Either you have to make it yourself or you have to get it from somewhere else. I'm not a fan of getting it from other places unless it's friends and family or maybe a bank, because as soon as you get investors that want their money back, you've decided to sell your company on that day.
Bill Flynn:
It may sound great, like, "Oh, they just gave me millions of dollars," but you've just decided to sell your company. They want it to be sold in five to eight years. Then you're going to have to figure that out, and sometimes you don't realize it until later and now you're in trouble and they generally vote you out at some point if you don't do what they want to do. So those are the three things. Learn how to build really great teams, learn a business operating system. There are 23 different business operating systems that I could find so far. I'm a fan of a few of them. And then lastly, really understand cash. Cash is such an important metric to understand, and we don't pay enough attention to it. We love revenue, we're enamored of the revenue thing, but it's vanity. Revenue is just vanity in my opinion, and I'm a 30-year sales guy, so that's saying something.
Gordon Henry:
That's great. You talk about, I think, some of the mistakes that entrepreneurs make. One of the ones you talk about, or maybe this is more [inaudible 00:15:56] of what you're supposed to do, is you say fire yourself from the day-to-day. Fire yourself from the day-to-day to the greatest degree possible to spend more time on creating the future of the business. What does that mean?
Bill Flynn:
Yeah, so for I think three or four years, I was a Vistage speaker, and I would speak, those of you who don't know, it's a peer-to-peer advisory group that's international. They're pretty big. They've been around since the 60s or the 50s, I can't remember. Basically, you go in and you talk to 15, 16 CEOs at a time. I was a speaker. I had this sort of little mini experiment I did, which every time I went to speak to these groups, I would ask the same questions and see what the answers were. I would either have them write them down or say them out loud. One of the things I asked them was how much time do you spend working in the business, meaning operating it, versus on the business?
Bill Flynn:
Now, these are businesses that are varied in size, but some of them are pretty big. I think I had a couple of billion-dollar businesses in the room, but most of them are tens of millions or hundreds of millions dollars in size. They've been around for a long time. They would tell me most often, 80 or 90% of them would be in the business and 10 to 20% on the business. And then with Vistage, they have a really, really cool thing they do is a check-in at the beginning. One of the check-ins is friends and family. And that means how are friends and family going? You do a score from 1 to 10. Always the lowest scores. I see fours a lot, fives a lot, twos. That means that you're spending so much time in the business you're not actually living your life, which is terrible. Then that's going to wear you down and I think this is sort of this vicious circle, et cetera.
Bill Flynn:
So what I said is what I've learned is those businesses that are run really well by the leader, they're not actually run by the leader. The leader has created an environment for other people to run the business because he or she knows that their job is now to predict the future of the business, not to run the day-to-day of the business. Again, varying of size, all those kinds of things because, especially these days, for many businesses is things are changing dramatically. Technology and other things, the access to data, so a lot of things that were protected before the internet and other things are not protected as much. And so things change much more rapidly, so you don't have time to do that. And that's about insight, innovation and creativity, and the question I also ask, and I'll this of you, Gordon, is at when do you get your best ideas? What are you doing? What's going on at that moment?
Gordon Henry:
Walking.
Bill Flynn:
Walking?
Gordon Henry:
That's my answer. Yeah. I do a lot of walking.
Bill Flynn:
Yep. And so you're just walking and you're probably just not really thinking that much. You're just walking. People say in the shower, when I'm on a run. That's generally when your brain is quiet and relaxed, because the older part of your brain is far more powerful than the newer part of your brain, and what happens generally is something called the edge effect. These are loosely-connected ideas that all of a sudden, they actually physically change your brain. Your brain starts to connect these two things physically inside. There's a biological change. That's when you get the idea of an insight. That's what you have to do. In order to grow and change, et cetera, you need to be innovative and creative, which is doing this. So the day-to-day, you can't do that. You cannot drive your car through an obstacle course and do complicated math at the same time. Your brain cannot handle it.
Gordon Henry:
Right.
Bill Flynn:
That's what you're doing. You're navigating an obstacle course when you're running your business, and then you're doing complicated math because you're like, "Where are we going? What are we doing?" You just cannot do it at the same exact time. You have to find time to just relax. There's this one guy here in the Boston area, his name's Brian Halligan. He runs a company called HubSpot, which is one of the best growing and most respected companies in the country, maybe in the world, and pretty well known.
Bill Flynn:
I know Brian a little bit. I'm not really friends with him, but we hang with the same people. I asked him once, I said, "How do you account for the fact that you went from zero to like $450 million in about eight years or something?" He wrote me back right away and said, "Every Friday, I work from home and I do not talk to anyone. I just think. I read, I write, I do all sorts of stuff." And he said, "And that's helping me to be able to plan for what we're going to do. I bring these ideas to my team and then we work through them." I think that's a great example of giving your brain a little bit of time to rest so you can predict the future of business because that's really your job moving forward.
Gordon Henry:
That's great. We're going to take a quick break to hear a word from our sponsor, and we'll be right back with more from business coach and author, Bill Flynn.
Gordon Henry:
We're back with Billy Flynn. I wanted to turn a little bit to you and your business and ask you about that. Are you able to work in any business? Do your ideas apply to any kind of vertical, any [inaudible 00:21:58] business? Do you find there are certain businesses you can't coach?
Bill Flynn:
I would say just about any business. I'm working from first principles, and they're pretty horizontal. So just about any business. I would say a business that's got more ephemerality to it, like fashion or design, where it's harder to sort of have some repeatability, because things change, tastes change, probably not as easy to do. I haven't tried it. My closest is sort of this crazy apparel company that does human streetwear. It's sort of art and clothing, but up until the pandemic, they were doing some great stuff. The woman who's leading it is just a wonderful leader and she's very humble and thoughtful, and just really wants to do the right thing by the business. Open to having help from other people like myself. So that would be it, but other than that... so that's a really small percentage of things, but yes, I've applied this to... I think I work in six different industries with my customers all over the place, from manufacturing to high tech to study abroad to e-commerce, whatever. They all work the same.
Bill Flynn:
I work with hundreds of coaches around the world, and it's the same. There's not a lot of variabilities. Now, the application of the principles will vary, but the actual principles themselves will not. For instance, if you're a really small business and you're not doing execution very well, on the operational side, there's this thing called EOS, which is probably a great system for you. EOS I think has some limitations in the long run. There's not really a lot of focus on strategy and vision and moving out beyond maybe a year or two. I have talked to a number of EOS companies and I have a couple of friends who were EOS implementers, and they call me up because I'm a sales and marketing guy, and they hear from me. They ask, they say, "Hey, I hear you're doing this. I want to run some stuff by you," and they're in EOS. I said, "This is the issue with EOS." None of them wants to admit that that's the problem, but they're saying, "I'm having trouble getting sales," which means I'm having trouble growing.
Bill Flynn:
EOS helps you be really efficient and works really well. I actually cobbled together my own little sort of mini EOS when I was a leader because I wasn't smart enough to know that there were systems out there when I was doing it, so I'd made my own. It worked tremendously well for a little while, and then it sort of slowed. I think generally 80, 90, 95% of businesses, this could apply to them. Absolutely.
Gordon Henry:
And your company is called Catalyst Growth Advisors and you're based out of Boston. You do take consulting assignments, so if somebody is interested in contacting you, we'll put that information on our show notes, but you're at catalystgrowthadvisors.com, right?
Bill Flynn:
That is correct.
Gordon Henry:
Okay, great. And you said something interesting to me in our pre-meet, that part of your fee is paid by the state if companies are coming in from the Massachusetts area, right?
Bill Flynn:
Yeah. There's this really cool fund in Massachusetts, and many states have it. I don't know how many. I know California has a similar thing and Rhode Island also has something. I think these were started years and years ago through the Department of Labor for the trades, mostly, to help you bring on the apprentice and help to fund that because obviously if you can accelerate their learning, then your business is going to grow and you're going to have more jobs available, that kind of thing. In Massachusetts, it's called the Workforce Training Fund. For me, I've worked out my fees where half of them are paid by the state. They'll do up to a certain amount of money a year and per employee, there's some restrictions, but as long as you're in good standing with the state and you pay unemployment taxes, you can benefit from a fund like that, which is just terrific.
Bill Flynn:
That's I think why... I have one client in Maine, and all of my other clients are Massachusetts I think because I'm pretty expensive, and they're like, "Oh, cool." They like me, but they're like, "I don't know if I want to pay that much money for you." I say, "Oh, actually you get half off," and they're like, "oh, great. Let me do that." It's kind of a pain in the ass, bureaucratic process. It's not really streamlined, but it takes about a week or two to really nail it, and then about three or four weeks to get approved. No one has not gotten approved that has applied from my customers, so it's a wonderful little secret that most people just don't take advantage of. It's too bad.
Gordon Henry:
That's great to know. So just a couple more questions about your thinking, your theories before we kind of round this out. So you talk about purpose-driven businesses and you say that many businesses should think about becoming a purpose-driven business or consider having a social impact angle. What does that mean?
Bill Flynn:
So purpose-driven and social impact are two different things.
Gordon Henry:
Okay.
Bill Flynn:
I'm a neuroscience geek and I love anthropology, I love all that kind of stuff. One of the things that these scientists have found is that we have this unique tension as human beings, especially in the United States, I think, in the West, is we want to consider ourselves as unique, but we also want to belong. The belonging is the purpose side. If you can give someone something that they can tie into and feel like they belong to something, but also make it so they feel like they're unique by belonging to that... this is the tattoo culture. This is emo, this is punk rock. This is Apple. Pick your cult-ish-like, well-known thing, and that's why they do really well, is because people are like, "Yes, I'm different, but I'm part of this group."
Bill Flynn:
There's this great meme that's out there. I can't remember where it is, but you could probably look it up. It's a classroom and you're looking at the classroom as if you're the professor. It has sort of that stadium theater seating, so you see dozens and dozens of students are there and they all have their laptops open like they're taking notes. All the laptops except for a couple are Apple. At the bottom, it says, "Be different," which is hilarious, but that's what they feel like, they're different. So if you could do that, that's a wonderful, wonderful thing to do because it really dovetails well with how our brain works. It's sort of a magic trick that you can do.
Bill Flynn:
So that's what I've learned. Having a social impact is great. I think it's wonderful. I think the conscious capitalism movement is a wonderful movement. It's really thinking about all the stakeholders as opposed to just the shareholders, which Milton Friedman screwed us on 50 years ago, whatever it was. And he was just wrong. Now, he was right in the short term. If you focus on your shareholders in the short term, then you will do well in the short term, but in the long term, you generally won't do well because you're ignoring your customers. You're ignoring your employees. You're ignoring your suppliers, your vendors, even your competitors a little bit.
Bill Flynn:
The conscious capitalism movement, which was really started by John Mackey and Kip Tindell and this guy Raj Sisodia, basically say, "Look, if you care for all of your stakeholders, over the long term it will benefit you. Yes, it will be expensive. You'll probably have slower growth in the beginning, but in the long term, it'll be wonderful because you're sort of building this immune system with all of these different players that are helping and protecting each other."
Bill Flynn:
It's exactly what Alan Mulally did at Ford. He said, "It's all of us. It's not just us at Ford and not our shareholders. It's our dealers, it's our suppliers. It's all of these different places." And he was right. In eight years, he turned Ford around from losing $17 billion the year he started, to, I think about six to nine months after he left in 2014, Ford for a little short little part of time was the largest car manufacturer in the world again. They were the first largest one until GM overtook them like 80 years ago.
Gordon Henry:
Right. Right. Their hit in the '90s I guess was the Taurus, right? Wasn't that the-
Bill Flynn:
Yes. Yes. He said, "We got to get more energy behind the Taurus. People love that car. Let's do it."
Gordon Henry:
Yeah. Last question before we get to a little bit more personal, is what I wanted to ask you. You talk about your customer research, and I think you love that saying, "If I asked my customers what they wanted, I would have made faster horses that people attribute to Henry Ford." So what do you think about customer research? I know you're fond of getting close to the customer, but you shouldn't listen to your customers to figure out what the next product should be?
Bill Flynn:
No, you shouldn't. If you type in the original train car, it looked like a stagecoach because the people in the railroad industry said, "Oh, let's just make," they just incrementalized the stagecoach, which is a horrible design for a rail car, right? It's not aerodynamic at all, it's top heavy. There's so much stuff that's wrong with it. There's a lot of great examples.
Bill Flynn:
There's a great story that Clayton Christensen was known for, which is called the milkshake story, which you might know, but many people don't so I'll quickly tell it, which is he was asked by a McDonald's franchise owner to come in and help him sell more milkshakes. He came in and said, "Okay, what did you do to do this?" He said, "Well, we talked to our customers and said what would it take for you to buy more milkshakes?" He said, "What did they tell you?" The owner said, "Oh, well, they said you need more flavors and you need different consistencies, more creamy, whatever. All these things." And he said, "So what happened?" He said, "Well, we did everything they said." "What happened to sales?" "Nothing. Sales did not move." He said, "Great."
Bill Flynn:
He and his team went in the next day and they just observed. They found that about 40% of all the milkshakes were purchased before 8:00 AM and another large percentage, but not quite as large, was bought in the early afternoon. Then he went back the next day and asked those people and said, "Why did you buy the milkshake?" And the people went in the morning and said generally the same thing. "I have a really long commute. It's super boring. I'm not hungry yet, but I will be before lunch, so this will hold me over." So they hired it basically to just distract them and fill them up a little bit. It really had nothing to do with anything in the flavor or whatever.
Bill Flynn:
Then the afternoon it was dad typically, and dad was with the kids and he wanted to feel cool because the kids would say, "Hey, Dad, can I get a milkshake?" And he'd say, "Oh, it's okay, but don't tell Mom." So what he said, "Let's figure this out." So in the morning, what they did is they changed the delivery system. They didn't change the product at all. Because one of the other things that happened was I think that the line sometimes could get really long. Those of us who, before the pandemic, you want to go to Starbucks. Sometimes you're waiting in line for like three, four, five minutes to get your quick coffee, but it's important and you wait in line. You're not going in the store, whatever.
Bill Flynn:
So he said, "For those who wanted to, we're going to put the milkshakes on the counter inside. We're going to give them a swipe card." Remember, this was years and years ago, before all the stuff we do with micro currency and all that today. "They can just come in, grab their shake, pay for it and leave. Don't have to talk to anyone." Sales started to go up. But in the afternoon, it was a packaging problem, so what they did is they actually changed the delivery system of the package. They made it in more like a sippy cup because kids would squish the cup, et cetera. They made it a little smaller so dad didn't feel quite as guilty, and they made the straw bigger so it was easier for a child who hadn't quite gotten the muscles yet, because it's kind of hard sometimes to get that thick thing through the straw. Sales went up.
Bill Flynn:
That's really understanding why your customers buy from you. Don't ask them. They don't know. It's not their job to tell you how to make them satisfied. Their job is to complain and tell you their struggles. We love that. We're really good at that, and there's gold in there, and you can take that information and then apply and say, "How would we solve for that?" Waze did that with the map. Google made a better map than MapQuest, put them out of business, but Waze said, "Why do people hire maps?" They found out most of us hire a map to go from point A to point B on time. Then they came at the problem differently and said, "How would we do that? With all the technology, all of the things we have available, how would we do that?" They used the gyroscope and all this stuff in the phone and create a much better solution and Google, the king of maps, bought them for I think a billion dollars, a billion three, I can't remember. The numbers I've heard, a million six, a million three, whatever it was. It was a lot of money because they didn't look at the problem like Waze did. There are tons and tons of other examples like that.
Gordon Henry:
Yeah. That's great. Well, Bill, we're almost out of time. I wanted to ask you, what do you do for fun? You're a busy guy, you got all these consulting clients. What do you do in your spare time? Or do you have any?
Bill Flynn:
I play hockey. It's sort of my outlet.
Bill Flynn:
It's in a mask. It's a little harder these days because I'm older and I'm not quite as fit as I was, but that's what I do. I actually played last night, and we won and I scored. It was very exciting. I don't score very often, so that's kind of cool.
Bill Flynn:
Otherwise, when I'm not working with my clients I love to learn, so I'm always trying to find ways to learn. I'll be reading or watching Ted Talks or whatever. I write about them a couple of times a month just to help me learn better, and I put that out. That's on my website as well. So those would be the sort of two things that I like to do. The other thing is, probably a third, which I do more often now with the pandemic is I love puzzles. I think that's why I love startups. I'm always doing the New York Times crossword. I'm very proud, because I used to be very intimidated by Friday and Saturday, which are the hardest days, and now I do them first. I still don't do them very fast and I sometimes have to cheat, but I'm getting better at it. So that's what I do.
Gordon Henry:
Yeah. That's awesome. And last question, what's next for you? You said you love what you do, so I guess maybe the answer is you keep doing what you're doing, but what do you see for yourself in the next three to five years?
Bill Flynn:
Yeah, I don't think I'm really going off a track, but I'm amplifying. I have a purpose. I'm a purpose-driven company as well, which is really me, it's called Simplified Servanthood. The premise is that I think it's a shame that really great ideas, really great businesses and really great people fail or struggle for completely preventable reasons. My goal is to change the slope of that curve that I mentioned, the 50% in five years, et cetera. It's not necessary. I've joined the MG100, which is something Marshall Goldsmith started and Alan Mulally started. It's a great organization with these wonderful thought leaders, Thinkers 50 is part of that. I was in a meeting with these people that I admire, I read their books, and Ken Blanchard is on there and Dorie Clark is on there and Michael Bungay Stanier, the coaching habit guy, is part of the group. It's just a wonderful group of people. What's lovely is they're generous, so they can help me amplify.
Bill Flynn:
I also became an advisor to the Women's Business Collaborative, with trying to get more women into leadership positions. Quite frankly, I think women are generally more suited to be leaders than men, at least in the longterm. The pandemic has proved that out a little bit with these great countries who've done really well. Seven out of the 10 best countries are run by women. It's kind of interesting. There's a lot of theories on that. So that's sort of what I want to do, is I want to reach more people as I can. That's why I wrote the book. As you mentioned, it's a do-it-yourself book. Most consultants write books so they can confuse you so you'll call them. I did not want to do that. I wrote it in simple terms, I have exercises that go with the book. If you want to call me, great. If you want to hire me, even better, but it wasn't designed to do that.
Gordon Henry:
Got it. Well, Bill, we're out of time, but I really appreciate you joining us. This has been a fascinating conversation, and I hope people who listen will look up Catalyst Growth Advisors, maybe read your book and who knows? Maybe you got a couple of consulting clients. So thank you and have a great day.
Bill Flynn:
Great. Thanks for having me on, Gordon. Appreciate it.
Gordon Henry:
All right. This has been Gordon Henry, Winning on Main Street. We've been speaking with Bill Flynn and we'll see you next week. Thanks very much.