Third party vendors can be pebbles in your shoe or building blocks for your school.
This is the time of the year when you should be taking significant inventory of WHO is on your team. This doesn’t just include employees; this includes Third Party Providers. Typically you hire a third party provider for one of two reasons:
Having strong third party support to do the things you cannot or don’t want to do is critical to your success. It can also be the pebble in your shoe that takes you down.
Six years ago, I started my business, and there have been two particular areas in which these pebbles have nearly destroyed my shoes, my toes, almost everything. (If you know college basketball and Zion Williamson from Duke--that’s the kind of shoe blow out in the 2019 tournament I’m talking about.)
These pebbles are:
I was so naive when I started my business. I knew nothing about the business side. I basically got QuickBooks and started failing forward. I met this very nice woman who provided some QuickBooks coaching. She was very patient with me. She too was starting her own business (selling creams or something) and didn’t want to keep books anymore (even though she had a gift). After a few months, she asked me, “Who is going to do your taxes?”
I asked, “Taxes?” I hadn’t given Uncle Sam any thought.
She said, “You haven’t been paying your taxes?”
I responded, “Ummm, maybe?”
She continued hopefully, “Your employee taxes? Your self employment taxes? Your quarterlies? Nothing?” When I just stared back at her, she said, “You need a CPA like yesterday. I know someone.”
Let me interrupt this story. This is important. Very important. Right there, ladies and gentlemen. Those words, “I know someone.” Be VERY VERY careful when you hear those words.
The CPA she pointed me to was great (I think). Honestly I knew nothing whatsoever, so who knows if the CPA was great or not.
I ended the year, and I was all caught up with cash in my pocket. She said that I was the most organized small business owner that she had ever worked with. I thought, “This owning a business thing was a piece of cake.”
After the turn of the calendar, I was getting pretty busy. It was still just me in the business, so I would check in with the CPA to make sure I was doing everything right. She said, “You know, I can do your books too, so you can focus on the real important work.”
I said, “That would be great.” I asked, “So no more quickbooks for me?”
“Nope, just get it all in there through your CC’s, and I’ll reconcile once a month.”
I only had to pay her a few hundred dollars, and I didn’t have to do it. Talk about a deal!
Towards the end of the 2015 year, I hired a full-time employee, and my bookkeeper jumped right on it. Geoff and I were working like crazy, putting over 50,000 miles combined on the two cars. WOW! The CPA took care of the books and was doing a great job. There was an occasional missed meeting, and QuickBooks wasn’t always up to date. Then I got a letter from the IRS about something needing to be filed. I reached out, and the bookkeeper was right on it. No issues at all. She told me that she had picked up some new clients and was growing herself as a business, but she assured me that it wouldn’t happen again. The end of the 2015 year happened, and Geoff and I celebrated our success: The business had grown 300% that year. We were thrilled!
But for some reason, something didn’t feel right. I hadn’t heard back from our bookkeeper for a while. QuickBooks wasn’t up to date, and worst of all, those IRS letters that she had said I wouldn’t get anymore now filled a trophy case. I was at a networking meeting and ran into the “cream lady”. I asked her if she had seen the bookkeeper. She shook her head, “No.”
After almost 50 days of no contact and my taxes due in less than 30 days, I had to write her termination letter. That was on 2/18/2016. Within 10 minutes, she responded, “I had a feeling this was coming. I’ll get your books ready for pick up.”
My only thought was, “What?!”
I scrambled to find a new bookkeeper. I had met another bookkeeper at a networking meeting, and she seemed nice. I thought, “Maybe she can help me.” We hired her, she cleaned it up, and saved the day. She didn’t file taxes, so I still had to find a CPA. I went to the Dave Ramsey website, and they have thee endorsed providers. Problem solved.
It was a good thing because the business was really taking off. We had added a few more consultants to the team; now we were stretched to schools outside of North Carolina!
A funny thing happened. While cleaning out my desk for our move to a new, larger office, I happened to find the agreement between us and the new bookkeeper. Seeing that we had been crushed by the last person (with no written agreement), we made sure that the new agreement addressed everything that had been a problem with the previous bookkeeper. We were paying twice the rate, but we knew it would be better for us. After re-reading the agreement, I asked Geoff whether we had been receiving all of these agreed outcomes.
He shook his head, ”No.” I didn’t have any idea that those outcomes had been in there.
We met with her, and she said, “Well, I was just waiting for you to ask for them. I can start doing them now.“
“Start?” I said.
She continued, “Or, you can just pay me for the regular bookkeeping, which is what I have already been doing.”
I wish I could say that this was the last time that I was burned. It was because of the people I chose; I was burned because of the way that I chose them. I had been violating John Maxwell’s Law of the Inner Circle. This law shares that a leader's potential is determined by those closest to him. The law warns us that we naturally surround ourselves with either people we like or people with whom we are comfortable.
It is critical to give significant thought to those you bring closest to you.
Ask these 5 questions:
One last bonus question, Do they display excellence, maturity, and good character in everything they do?
There are two critical steps in achieving the goals you have:
Once you have this team, it is critical that you praise them publicly as much as possible. Nothing worthwhile is accomplished alone, and public praise will let everyone know that you know who is responsible for your success.
Every year as a business owner, I should be getting better at this, but to be honest, I think I have gotten worse. Recently, we hired someone to transfer our current web site over to a new platform (the 4th change in 5 years by the way). The new platform is what holds these calls and is really a one stop shop for us as a team. Our last provider was great, very customer-service friendly (as long as you did it their way). She was definitely a tech-guru. Not a call went by that she didn’t let you know that. She wasn’t excited that we were leaving, and long story short, the transfer got ugly fast.
Please understand, as most of you know, my EGO is huge. Instead of a “Hey, can we talk about this,” I went on a closed Facebook group and asked, “I need someone to do these two things like yesterday.” Someone who I trusted on the FB page recommended an expert in the UK. I reached out to said expert and said, “Look, I have these 2 problems. You came highly recommended. She said, “Sure. Here is the price. No problem.”
Click and problem solved!
Two weeks later, problems were not solved. She was making progress, and when I shared my concern with how slow the transfer was going, she said, “Oh, I didn’t realize there was a timeframe. This Google transfer thing is a lot harder than I thought. Cheers!”
Cheers is right. Right to our old providers because I had to pay them for another month.
I said to the UK provider, “Get it done.”
I put two other team members on the work to keep it moving.
I reached out to the guy who recommended her and asked, “Hey, what work have you done with her?”
He said, “None, but she always seems to be right on point with her responses in our group.”
“So you’ve done no work with her?”
“No,” he said.
“Ok,” I replied as I heard the flush of all the cash going down the toilet.
March 15th comes around. This is the deadline we’d given the new team for the transfer. Emails are flying; invoices are coming in from the first group with an offer to extend for one more month, and I said, “Nope. We are not paying. I gave the UK group a deadline. If we lose emails, then we lose emails” My ego was on fire!
The next morning I get an email from a client, “Hey, I am trying to upload all of the resumes for the HOS position into our folder, but it says it’s gone? I uploaded like 60 yesterday.”
That was the first clue that things were amiss.
Over the next two days, there were multiple similar messages. The drive was not fully transferred. The emails were not syncing. I had to crawl back to the old provider begging, “Will you please turn on our old domain?”
Remember when I said I had the opportunity to pay for one more month? You may have thought this was a big bill. It was $15. Now they wanted $500.
I have a great deal to learn. One thing I have learned is that when you are struggling, find someone WAY more successful than you are and ask him or her how he or she overcame this challenge. I turned to my mentor, Paul Martinelli. He has built 5 multi-million dollar businesses and runs amazing PD experiences. He gave me 5 strategies that I am gifting to you so that third party vendors stop being pebbles in your shoe and instead become building blocks for your business.
Honoring and valuing time is critical. If they are late for something, make a big deal out of it Ask them, “What could be more important than us? Five of my people, waiting for 5 minutes. That’s not 5 minutes that’s 25 minutes.”
Remember, how you do anything is how you do everything, so be slow to hire and quick to fire.
I love what Mark Tracy at Kestrel did with me when he first hired me. We sat down and walked through each of the objectives and talked through what they would look like so that each of us had clarity. He had also recently gone through a challenging agreement and wanted to make sure he learned from his experiences.
At LBL, we provide our clients with monthly or quarterly updates. My white board is filled with each school and what we are aiming to do, so I can keep it in the forefront. It doesn’t always happen.
Steve Joyner sends a monthly time log. We have built something similar. As a business, we need to be able to answer this one question: Is the LBL team serving the organization and its goals?
To ensure that you are not making the same mistakes over and over again, do these exercises:
Reflection: This is critical when you lose a hire. I remember my first fire and first hire. When that first hire left in the dead of night, I thought, “What could I have done differently?” What about you? What could you have done about your first fire?
Call to Action: Design your A level players, including a description of the skills, competencies, character, and measures of success.
Design your process, your postings, and partners.
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