Josh Fonger, Co-Founder of Work the System
Josh Fonger is a consultant, coach, and speaker who is recognized as the leading authority in Business Performance Architecture. With his unique ability of developing and implementing systematic solutions to complex business problems, Josh has personally consulted or coached over 600 business owners from more than 100 industries, from small startup businesses to large $500M enterprises. Due to his phenomenal success rate, and a mountain of client testimonials, he has quickly become one of the most in-demand small business consultants in North America.
workthesystem.com/sus
https://www.workthesystem.com/podcasts/
https://www.workthesystem.com/coaching/
AUTOMATED EPISODE TRANSCRIPT
[00:00:01] You're listening to Scaling Up Services where we speak with entrepreneurs authors business experts and thought leaders to give you the knowledge and insights you need to scale your service based business faster and easier. And now here is your host Business Coach Bruce Eckfeldt.
[00:00:22] Are you a CEO looking to scale your company faster and easier. Checkout Thrive Roundtable thrive combines a moderated peer group mastermind expert one on one coaching access to proven growth tools and a 24/7 support community created by Inc award winning CEO and certified scaling up business coach Bruce Eckfeldt. Thrive will help you grow your business more quickly and with less drama. For more details about the program, visit eckfeldt.com/thrive . That’s E C K F E L D T. com / thrive.
[00:00:57] Welcome, everyone. This is Scaling Up Services. I'm Bruce Eckfeldt. I'm your host. And our guest today is Josh Fonger. He is a business-performance architect. He's also the co-founder of Work The System. We're gonna talk to him about the work he does with companies, help them figuring out how their business structure needs to pull together to be able to scale it effectively and efficiently. So we're gonna talk about that. He's also an architect by training. I was love to talk to other architects having a background and articulate myself. I'm sure we're gonna talk about how you can approach business and the architecture of your business to help make sure that you've got solid foundations to be able to grow and scale. I think it's a big, big thing. Most people miss when they're putting together their businesses and figure out how they're going to grow them is making sure they have that particular right from the beginning. So with that. Josh, welcome to the program.
[00:01:39] Glad to be here. So why don't we start with a little bit of background? So I kind of let the cat out of the bag saying that you originally were an architect. But tell us the story of how you went from architecture to the work that you do now with work, the system.
[00:01:50] Yeah. Try to try to capitalize the story. But yeah, it's trying to choose between architecture being a doctor and business major. And I chose architecture. So that was that's kind of where that happened. And from Michigan to Arizona and working in the field, I realized that people who actually made the most money and got to make the most choices about how things actually happened were the developers and not the actual architects. And so I learned early on that if I wanted to play the game on a bigger level and actually tell the architects what to design, I'd to be the developer. And so I worked with investment companies and was a project manager. All right. To college. And most people are aware of the crash, two thousand eight thousand nine in that time. And so I was part of, you know what, those casualties. And, you know, at a wife and two kids and had to make some money. And after not finding anything, unless I want to take a 90 percent pay cut, I really had to jump to something different and talk about this in my own podcast. But I got my bachelor's in business as well.
[00:02:50] Well, is it doing development? And I wrote my thesis about why you should never hire a consultant like why you should hire consultants. Why is that? They're actually going to take your money. They were really valuable. They weren't useful. And they just gave you boilerplate. You know, you really just do it yourself. You should excel and that your team should develop these ideas. But, you know, when you know you have no job, you have no money. You got to beat tickets. You'll take whatever job you get. And that was the only job I could find. I was to be a business consultant. And so I took it, you know, and this this is not with Sam Carpenter, my current partner, but with another guy. And I had to I had to learn very quickly in the field, because as he just said, hey, are you good at outside sales? It's like, oh, yeah, he's like, how about, you know, putting presentations on? And I said, yeah, should be no problem. And and he just sent me out on the field to all these different clients. And miraculously had some had some success and really enjoyed the work.
[00:03:43] Yeah, well, not not an uncommon story. You know, necessity is the mother of invention or reinvention. And that's the case. Maybe because we did anything that you learned about yourself in that process. I mean, I always find that in those challenging times, you know, is when we really kind of have to dig deep and figure out like what what are we made of? What do we really care about? What are the things that are important to us and eat? Any interesting takeaways for you in that?
[00:04:05] Yeah. Not to get too deep when you try to me to cry.
[00:04:09] Plus, I wouldn't be the first time. But we try to keep it together.
[00:04:13] I you know, I learned that what what is most most valuable in life obviously can't be taken away from you. So I would say definitely for anyone who's gone through the kind of crushing the experience of having everything taken away except for your family, friends, your faith like that, those all get strengthened during those times. And you once you realize that most what's most essential, you can't lose. It gives you a whole lot of confidence, a boldness to to try new things and to expand it, change yourself. And so, you know, it great. It was great to lose it all and to go with, you know, Josh 2.0. And so I think it's it's an amazing, serious that most people never get to have if they've never been laid off or had something like this happen, that they're they're stuck in their patterns. They can't they don't they're not gonna push themselves into that situation. Yeah, no, it's a purposely do it. And so I think for those who've done it, never have it happened to them. They're way more resilient, the way more resourceful. They're they're they're hungry and more pragmatic about solutions. And so there's the theoretical like my first gig consulting was here's a list of two thousand names. Make some calls if you don't close anybody. You don't make any money. You don't. And so. Yeah. And I'm going to close some sales, even though I have no idea how to. You know, cold calling my early. So you just figure it out because you have to. And I think that that's once you had that competence as a as an entrepreneur out in your own, you are way more competent trying other things because, you know, you can figure out if you really have to. And most people who've been employees their whole lives are waiting to be told and they have never built that muscle.
[00:05:38] Yeah, it's not an uncommon story or a theme. Think for a lot of the folks that we've talked to on this podcast, just in terms of what they do now is somehow informed by impacted by created by, you know, some kind of adverse event. You know, whether it's a personal financial health business. And in that process, there's kind of this. Well, you know what? I survived that. And it wasn't it wasn't as bad as maybe I envisioned it could be. And so it gives me a lot more. Yeah, I think it's confidence, but it's also, you know, the ability to take a risk, knowing that, knowing that these things are, you know, survival, not fun necessarily, but they're survivable. And it gives you a little bit more willingness to to try things be less kind of risk adverse or kind of fear based and more opportunity based.
[00:06:22] And I just see that as just a pattern. A lot of the folks that have kind of gone through this process and come out the other side and it's seen that as a take. So it's interesting. So tell us about the work with Sam and the work, the system, how I guess how to how did that come about? How have you kind of sounded that and what is the focus of that business?
[00:06:39] Well, yes. So basically, I was flying around from case on location, location, helping out flooring store owners. So these would be people, a mom and pop shops, maybe they were doing two to three million dollars in sales, family, generational business. And I would clout there. And I realized that all of the things I would put in place would actually fall apart within three months, six months, a year, because they were things that I was installing in the company from the outside and it wouldn't stick. And I met, you know, I read this book called Work The System. I lived in Bend, Oregon, where Sam Carpenter lived. And I realized that his solution, which was kind of documenting the processes of your business so that they do stick and so that they do scale and so they can be innovated upon was an approach that I need to use my own consulting. And I became friends. And ultimately, he he's 70 now and he's enjoying total freedom.
[00:07:26] Doesn't need he doesn't need the money, doesn't it? It doesn't reach the goal.
[00:07:30] Oh, yeah. And he's got an amazing life. And so he and I met when he was 60 and he didn't want to do any coaching or consulting or creative ads because he didn't need to. But his book had such a massive following and interest that it kept getting people wanting help, one help with a business. And so he realized that he would need someone like me to grow a business where we actually help these folks, not just hand them a book, but actually walk them through the process of installing what we call the work, the system method of the business. And so about eight years ago, we we founded that company together. And that's what I've been doing since Donna.
[00:08:03] And I guess why do people have the challenge? And I see this and lots of kind of cases, but I'm kind of curious in your cases that you've got this book, it's compelling. It talks about how to how to do these things, like where does the book fall short and what is lacking that creates this opportunity to build the practice room?
[00:08:20] Yeah, I think just like losing weight and people might read about it and know how to lose weight or know how to fix the business. Since it is a change, it's they need help walking through that change, whether it's accountability, additional training, coaching. Maybe they're missing some tools, but ultimately they aren't going to make the steps on their own because it's not natural to them. What's natural to them is shooting from the hip, putting fires out, just kind of always reacting to the environment. What's unnatural is to step back, look at it, have an objective look at your business to build a strategy and principles and procedures and teams and just do the methodical structure building that all large companies do and ninety nine percent of small companies will never do. And so that that's the way you fit in is actually walking them through that that process, because there's a lot of, I guess, shiny objects long today and they need somebody to hold them to. The fact that this is building processes and procedures in your business is never urgent, but it's always important. And so the urgent things always take them off track. And so we're here to keep them on track and to help them through that transition from knowing it all in their head, to get it out of their head into a framework where they can actually grow a team and they can actually hold the team accountable and they can actually set up some consistent KPI is and they actually can, you know, scale. So it based on the conversations that you and I had before this interview. I think that you probably work with more companies that have made it past this transition. And now they're actually doing, you know, five, 10 million plus a year. And now it's about how to get a hundred million. And beyond that, where it's more about leadership and team culture, whereas most people I work with, they're never gonna get to that level because they keep it all in their head.
[00:10:01] Yeah, yeah. I would say that there's a there's a a series of kind of evolutionary processes that, you know, a founder CEO needs to go through, you know, to grow and grow to business. And some of it's some of his external, you know, looking at market market strategy, some it's internal in terms of process and system. And honestly, some of it is mental. It's just changing the mindset and the.
[00:10:20] I kind of view the perspective that they have on leadership, on their role in the business about what they're focused on and they're all very different takes kind of expert coaching and systems are going to help each step. I'm curious what you've as you've worked with companies, if you worked with leaders on this process. Is there anything that tells you fairly quickly you're either in conversations with prospects or, you know, early in the client relationship, either attributes, characteristics, things that tell you that someone is more likely or less likely to be successful in this process. Are there any early signs that you've identified or experienced, you know, looking at all the people you've worked with?
[00:10:56] Yeah, I think it's going to be based on hunger or desire, like if they have and that's how we help them. We actually help them visualize what their life would be like if they have more, more time or more money. That's that that's our three criteria is basically lower your stress, give you more time back as an owner and give you more personal income. And so are those three categories. What will your future look like? And if they just say, oh, my future will be a little bit better, although I'm not going to go through that. I know if they say they want to grow their business by 3 percent, then they're not going to do the work. It really comes down to somebody who has ambition to open up new locations. They have ambition to sell their business. They have ambitions to, you know, get their business to their son or daughter. They have ambitions to really go beyond. They have special projects that they just can't get done until this structure gets put into place. And so we've had one client where they're the number one manager died and they sign up for our program. They were very motivated.
[00:11:55] They saw what what that did to destroy the culture, the relationships that the business operations, you know. So when things like that happen, you know, one client where she had cancer, he was going to be terminal. Well, she was very much against structure in place because it was a family business. And so it's a lot of it has to do with what is the driving motivator if people are are okay with things as they are status quo and they then they won't do this. They have to be in a lot of pain. So I guess that would be it is. Do they have a strong current pain, like at a client where his wife was pregnant and she really needed him to not be working at hundred hours of work, hundred hours a week. He was very motivated. Get done a lot of pain and a a big a big ambition for the future because they know they will never get to that big ambition without putting this in place. And those are my best. It has nothing to do with intelligence or degrees or industry. It has to do with those things.
[00:12:49] Yeah. And I think that makes sense. I think the one the one thing that I run into, you mentioned, you know, selling the business and that that's often the case is, you know, working with companies who are looking to grow in scale and sell. But one of the first conversations I have with the founder with the CEO is, is after you sell, what are you going to do? Because too many times I see there's no plan. There's no concept of, you know, literally how my going to spend my time, how I'm going to measure my self-worth. They get so their egos and their self-worth are so trumped up, so wrapped up in the business that they go to sell. And either they sell and they're miserable or or they sabotage the sale because they haven't. They get so scared of actually not doing anything, know they'd rather they'd rather just keep the business going and actually sell it at a very nice profit. You know, that's going to give them financial freedom, but then they don't have any purpose. I'm curious what you run into. If you've seen that at your level of of this kind of we'll see you get a whole bunch more time. What are you going to do with it? Problem?
[00:13:43] Yes, it actually does happen. And I remember this one of my first clients with Sam was saying that we're just figuring this out, like how do we help these companies? Because he tested out in his own business and he had gone from a hundred hour workweek to a two hour workweek. And he wrote it all in his book work. And so here out there in the field and we had this client and within three to four months, he had worked himself from 50, 60 hours a week to the office, didn't need him at all. It was it was a commercial appraisal firm. And he was having his best months yet. He was, you know, 20, 30 percent growth. And he said, now what I do. And so he he joined a band. So a church band playing guitar. And he got a road bike and a lot of road biking. And now there's some other hobby he got into. But basically is is Josh, I've been doing this for three months now. They don't know me, the office. So I think it might open up to more locations. And then he got you know, he got more motivated. He went back to work and he was really excited to stick the structure he built, opening up new locations and different cities. But he was so burned out, he had to take some time just to like just figure himself out. But yeah, it definitely happens. And that is what the coach gets all. I mean, in your experience, do they need to help you break out of normal? Because oftentimes entrepreneurs lives. What they think is normal is crazy. It's it's insane. It's like there's there's someone here to talk to you about this podcast. And she thought that was a normal for people, her staff, to work till six or seven and at night every night from Monday through Friday and then also work Saturday and also works Sunday afternoons. And she thought that was that was normal. So she does. Yeah. It's like, well, why don't my employees do that? I said that you're never going to do that. They're not crazy. But you didn't know that.
[00:15:23] Right? Yeah. No perspective. The other one I always find as I run to these entrepreneurs that get frustrated with their team and they're like, I just want people that are more entrepreneurial. And I said, I don't think you really want that. I mean, think about you as an employee. Think if you were trying to manage yourself, you would be a nightmare. Right. And so I think people get stuck in this. Why can't people just be like me? Mindset or this kind of mentality? And it does take some kind of awareness and reflection to realize that you don't you don't want that and your norms are not reasonable norms for the rest of population.
[00:15:53] Exactly. But I think that the the genius of entrepreneurs is they need to realize, is that the only way they're going to push down some of that genius onto their team is by getting their genius into a scalable format. That's why our you know, that's kind of the unique thing that our company does to try to help them get that, whether it's video, audio, text, some kind of recorded framework so that they can pass it down. And their team has the same strategy. This team has the same principles. Their team has the same ways of doing things. And any entrepreneur can say, oh, wait. Now, now my team is aligned with what I think. And I can go do other things because, you know, I have these scalable entities, these little assets that will teach everybody beneath me.
[00:16:33] So talk to us about the system.
[00:16:34] So what is the basic sort of philosophy or process that you work people through? What does it work? What are the challenges of it?
[00:16:41] So we try to keep it as simple as possible. So, again, we're working with small companies and you know, you were talking before and about, you know, a lot of the structure that big companies, five, 10, 50 million dollar year companies had a lot of structure. But and they needed because of the team is when you're when you starting out, you have to be really simple and pragmatic. And that is where our method excels, is that for one, we work on the owners mindset. So we call it the systems mindset where they they extract themselves from the business, get outside of it and they see the separate pieces of it, not for for them in there, but just for the systems. And so this is a mindset shift first, which can be quite quick. There's a strategic objective, we call it. So it's a one page strategy document, which is basically where you're going and how you're going to get there. So one page quick document. It doesn't need to be eloquent, but it does need to keep you and everyone else on track motivated towards a common direction principles. So how do you make decisions about everything time, talent, design, customer service, like a document that. So some folks might call it your your values or your beliefs, but you do need one document like that, even if your company is just, you know, you and your wife, just something that lets everyone know. Anyone who works with us is going to follow these principles.
[00:17:53] And so, I mean, I give stuff to my team all the time and I just say follow the strategy and principles and then then to figure out how to do this, because you know how it's all of it. And this is, you know, new initiatives, new projects. And then the last thing is procedures. We call them working procedures. Bigger companies might call them S.O.P. As we call it working procedures, because you are always working on them and you're always working in them. And we build that one at a time. It's we call it the heavy lifting because no one wants to do it. But, you know, we have coaches and we have writers and we people who will help you extract that piece by piece. You know how to open up the doors in the morning, how to lock up at night, how to do the recipe, how to make the sales call, how to do each little tiny piece of your business the right way. And then then you can innovate on that. That's the that's the best, basically the model. And then over time, those procedures will get more complex into how they do their sales and their marketing and customer service and their finance and their I.T. And so we know gonna build up a collection of those. And that's really helped them, you know, in our case, get to the next level where they can work with you.
[00:18:55] Yeah. And what are the challenges? I mean, I'm a big believer in standard operating procedures about defining the process, improving the process. But I always find there's kind of challenges, hiccups in terms of, you know, extracting that. And then it can be painful from the people that kind of know it or are currently working the process. What are some techniques or what are some methods it use to be able to uncover or discover, you know, extract the processes that currently exist in the business into a real defined, documented system? How did how do you do that?
[00:19:26] Yes. And there there are a whole host of ways to do it. And the main thing is the leader needs to decide 100 percent it's going to happen. I don't think that's the number one thing, is that they're kind of like, well, give it a try and we'll see if it works. It'll never happen because everyone is going to not want to do it first because it adds additional work. But then once they know the owners decided we're definitely going to do this, at that point, you'll find different ways to do it based on what type of business you're working with and the skill sets of the people in your team. So if they are like, I'm working with a landscaping company and they're all on the field whacking him, mowing lawns, I'm not going to be asking them to write a bunch of working procedures and type them up because that's not going to be their skill set. That's not where they work. So I'm in a more trying to get videos, pictures, audio of some of the systems that they're going to do, whereas an accounting firm is getting more of, you know, type them up and use screenshots.
[00:20:15] Sometimes we'll use things like a loom or snack or camp Tasia to. Screen record, oftentimes for me, my preference is audio, so I will give my team a procedure via audio. So I'll just say, hey, you know, we're going to do a new accounts receivable process. Here's the purpose of it. Step one's gonna be this step, too. I'll walk through it in a three minute voice file and send it up. That's it. So that that's the easiest for me to get it out of my head. So it's about, you know, figure out the technique and having playing the long game, which is long gamers want to do this. And, you know, in Sam's business, in his book, he talks about what he did. He's got about three hundred procedures in his business. And that sounds overwhelming. So most people won't start. But if you have a goal of let's just do two or three a week. Most people can do that. And it's just about being consistent after that.
[00:21:03] And do find I mean, you mentioned the three hundred procedures, which sounds daunting, but I guess where do you typically start or where do you advise folks to start and how do you identify the procedures that need to be done first? And then how do you kind of building grow based on that?
[00:21:16] For most companies, the owner is the bottleneck and bringing up the owners time is the most valuable thing a business can do for small companies especially. And so we figure out what is what are repeatable things the owners doing that really they shouldn't be doing. And we try to cleave those off into procedures. So it might not be the most consequential, amazing, complicated thing. It might just be a you know, the owner stays here late at night and locks up and puts the security password and does that stuff. We could pay someone $10 an hour to do that. So let's get the owner. You know, that one thing that he does every single day. Interestand and so we're gonna cleave of the things off the owner first. That's gonna be the best for the business. And then beyond that, it's going to be what's going to have the biggest, hardwire, biggest impact. That's something that you're you know, is you're doing really bad. Like, let's just say you have a sales team. There's no process for how you actually have a sales conversation. And you're thinking, oh, we're doing this sales conversations every day. One does it differently. We really need to get this documented, because I know if we get it right, we could probly double our business. And that's gonna be a key foundational procedure to work on. But oftentimes I find out what people really do is the next problem that their company runs into. Like tomorrow they have an angry customer. They'll say, you know what, we don't want that to happen again. What happened? Let's write a procedure so that we don't have any more angry customers. And they will they'll handle the next fire that pops up and they will build a system to prevent that fire from happening. So now any one of those techniques and there's there's a lot more to it can work. But the main thing is to commit to it to get started. And, you know, really free up the owners time.
[00:22:48] Yeah, I like that. It's almost like start with Haine and then look at value, because I think that's smart because, you know, people are far more motivated by pain than value. Like I tell somebody like you can make an extra hundred dollars or I can remove this thing that is this horribly painful for you. They'll know the value of removing the pain I find is a lot more than the financial benefit of some of these things. So, you know, folks focusing on getting the owner enrolled, bought into the process by removing pain from them, get committed to seeing the value and then rolling that out. I think that makes kind of psychological sense in terms of how you get people to adopt this stuff. Let's talk a little bit about sort of the other challenges of implementation. I certainly have seen I can imagine you've run into so as a leader, you bring in a system like this. You know, you're working the you're documenting the processes. You're communicating these out. You're working with your team, and you run into some people on your team, some people in your organization that just just refused to follow the process. Right. It's documented. It's there. You've made it clear that this is how we're going to do things. And they just choose to do things differently. You know, they're their lone wolves. They're mavericks. They're just by nature, not process or at least not rule followers or process followers. How do you deal with that situation? I see that come up a lot.
[00:24:00] Yes. Yeah. And this is dealing with reality. Hence the need for a coach or a consultant and a couple different quick ways to handle it. One, you know, if there really a problem to your organization and your principles say we're gonna be team players in your strategy says they're gonna follow systems and they just really are gumming up the works and causing problems after they've been shown the strategy principles they might have to leave. Right. People who are really great for your company in a dysfunctional, you know, emergency type business are not always great people when things are organized and dialed in and efficient. So they might just not fit the goal of the business anymore. That sometimes is the case. Sometimes they're just not the kind of person who can build procedures. And so they're happy to follow them. But they're happy to innovate on them. They're happy to share their ideas. They really love the concept, but they're just not going to be the one to ever get it down on paper. And so that's fine. You identify that and you say, okay, so you're not going to be a writer. You're not going to be a reviewer, but you're going to be someone who innovates and you're gonna be someone who's gonna follow them when they're done. But you're just not going to help us build all these things.
[00:25:01] And there's gonna be some folks like that for sure. And then often what happens is I call quarantining, but you have a maverick or now it's usually they're an outside salesperson and they're a deal maker and they just do things their own way. They're never going to follow what you do, but you really need them. And so or their family. And so what you do in those cases is you. Hey, Jim is going to stay in the outside sales division or the special projects division, and he's not going to be part of this program. And Jim, you're not going to, you know, obviously get the support and the efficiency and the automation and the technology we're doing here is Gestapo, dear old thing, and we're gonna let you do it, but you're not gonna screw up or we're building it. So you've got to set appropriate border a let everyone know man sometimes. And that's what's happened is that Jim, who quarantined after six months or year, is like, hey, you know, it it sure is nice over there where everyone's dialed in money that they're not working weekends. And sometimes they're they're late adopters. But yeah, the reality is sometimes you can't lose, Jim. And so you just you have to kind of make those leadership decisions.
[00:26:00] Yeah. And I think that's one of the hardest things about this process. Yeah, unfortunately. Do you get in situations where, you know, someone is not working out with the new plan and how things to work, but eventually you need them from, you know, from a revenue or an expertise point of view.
[00:26:12] And yeah, I like that the quarantining or the isolation strategy of, you know, preventing them from from making it difficult to do what you want to do with everyone else and making sure you're making progress without losing the valuable contribution they make and then ultimately deciding what the bigger picture strategy is. But yeah, that's I think that's one of the challenges. So, Josh, if people wanna find out more about you, about work, the system, what's the best way to get that information?
[00:26:34] Well, I've got a special page just for your audience. It's workthesystem.com/sus. So if they go to WorktheSystem.com/SUS, they're gonna find information there. We give away the book for free. So I mean, you can certainly buy it on Amazon for 20 bucks, but you can download it for free on that page. I've got a podcast as well. We talk about similar issues to, you know, how to thinks your business, how to grow it, leadership, all the latest tools, things like that. And then also I run a coaching program. And so our our flagship coaching program is there as well.
[00:27:06] Awesome. I'll make sure that the links are in the show notes so people can click through, get the information from the webpage. Appreciate you setting them up and the podcast. I'll make sure people can get that. Yeah, there's a great conversation. I think we're we're just scratching the surface on many of these things. But that whole idea of how do you make your business a system and how do you optimize the system of all the system so that the system is doing the work, not you. As you know, as leader, as CEO, as founder. So really, really good points. I think it's something that we can all strive to do continually get good at. So this has been a pleasure. Thank you for being on the program today. Glad to be here.
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