How to Go From Entrepreneur to Leader

How to Go From Entrepreneur to Leader with Alex Judd

Our guest is Alex Judd. Alex is the Founder of Path for Growth out of the belief that everyone wins when a leader decides to intentionally grow every single day. He is a passionate communicator who leveraged his time-tested principles to help leaders define the vision, take action and finally get great results. Before launching Path For Growth, Alex worked as the host of Dave Ramsey’s nationally-recognized EntreLeadership Podcast. That podcast was a great resource for me as I was developing my leadership skills, therefore I love being able to speak to Alex. In our interview, we dive deep to understand what is leadership and the responsibility of every leader in their organization.

Pay attention to how Alex explains how you need to transition from being an entrepreneur to being a leader with practical tips. Also, listen to the way Alex breaks down the steps to build a proper communication system for your organization. Finally, pay close attention to the practical tips Alex provides on how you need to focus on outcomes instead of focusing on tasks. This episode has many deep concepts for leaders that if you read it once, I ask you to read it again as well. Without further ado, here is my interview.

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Alex, thank you for joining me on the show.

Thank you for having me. I’m excited about this.

I’m excited as well because the Let’s Talk Business community knows that I’m all about leadership and personal growth, business growth. Who better could I have on the show? Somebody that was the host of the EntreLeadership Podcast and now you’re on your venture of starting your show for leadership and helping leaders get to the level that they need to be. There’s much to talk to. I think I’ve heard it when we spoke about your transition and getting into this path of creating those groups for leaders. There is a passion out there to support those leaders and help those leaders grow their companies. What motivates you every day?

I wake up every day with this conviction that everybody wins when a leader decides to intentionally grow. I believe that because I’ve seen the ramifications of that in my own life. When I’m working with and working for, and working around leaders are intentionally growing every single day, it benefits me personally, spiritually, my career and every part of my life. Also beyond that, when I decide as a leader and it is my responsibility to decide this, that I’m going to grow every single day, the ripple effect into the people that are in my sphere of influence is massive. That’s why I’m passionate about working with leaders and specifically impact-driven leaders. It’s because I believe that everybody wins when a leader decides to get better.

I want to start there where you left off. My follow-up question would be, I know the word leadership has been used for the last decade way more than it used to be used in the past. In the past, it was the boss, manager, and so on. I know that you and the organization you worked for in the past and organizations like that have been pushing that in helping leaders understand their role, their responsibility, and what impact it will have on their people and their corporation and business. My question to you is what fundamentally changed? What do you feel changed that an average leader, business owner reading to this show would say, “Do I understand what changed from manager to leader, boss to leader and so on?”

I think that an incredible transformation occurs when people recognize that the primary measure of effectiveness in leadership is not your performance. Your performance is important and that’s the price of admission to be a leader, but that is not the primary measure of effectiveness. The primary measure of effectiveness in leadership is your ability to make other people effective. If you can unleash the best in others, if you can take their strengths, talents, gifts, passions, calling, wiring, if you can take all of that as a leader and put it to work in a way that produces towards the desired result and the desired vision, that is leadership.

Often we think that, “I need to focus on me. I need to perform. I need to act.” We take the role of a superstar and a superstar is a great individual. We should all be superstars in our chosen craft, but we need to recognize that our individual performance has little to do with leadership because leadership is entirely focused on serving and adding value to other people.

What does great leadership look like?

I heard a quote once that said that the highest calling of leadership is to unleash the potential in others. I think that plays directly into your question of what does great leadership looks like? Great leadership looks like investing the time, the energy, the effort. Going the extra mile when people can’t see it. Doing the things that no one else wants to do, being bolder and braver and audacious than most people are willing to be because you believe so much that the collective, the team, the group is more valuable than the individual. As a great leader, you’re willing to step up and say, “I will do what needs to be done to get us from here to there.” I think that is crucial. Leadership is taking people from here to there. Many people are trying to lead and they don’t know where there is. I think first great leadership starts defining starts by defining where there is and then investing the time energy effort to get people there and have a blast doing it.

One of the ways that I got connected to you is through the community of the EntreLeadership, which is run by Dave Ramsey. I’ve had the privilege of attending one of those events. I think it was a three-day event, EntreLeadership Summit and then I got hooked on the podcast that eventually you were to host. If you have to sum up everything that’s being taught in leadership, it’s about the leader who needs to know, needs to gain that level of clarity. You gained the level of clarity, you’ve got to cast it to your team. It’s not enough that you declare, you’ve got to cast it as a team and you have to bring your team along. I want to get into how you do it. You have that passion, you have that vision, you have that mission, whatever you want to call it, what you want to achieve. You then cast that to the team. As a leader, how much of that vision is it the leader’s vision that then they’re casting it to the team and the team is, “Let’s go do it,” versus bringing in the team as part of developing that vision in the first place?

I think it’s dangerous to prescribe any general like, “This is the only way you can do things.” I like to stay away from doing that because I think some teams thrive best whenever they all get into a room and say, “We’re going to figure out what this vision is together.” Some leaders need and desire that. There are some leaders that their gifting and their wiring is their ability to see a future that doesn’t yet exist. The way you framed the question is correct. What we have to make sure of is that we achieved the desired outcome. The desired outcome is that everybody knows, number one, crystal clear what the vision is. Number two, everyone buys into what that vision is. I think of outcome-oriented leadership. You need to be driving towards the outcome of everyone on our team knows where we are going.

If I was to walk into your office, I could ask the question of anyone and they would say, “This is where we’re going. This is the hill that we’re climbing or hopefully the mountain that we’re climbing.” Not only that, but the second objective that you have to achieve if you’re going to be an effective leader and by extension an effective organization is your people have to care about that vision as much as you do. The strategy for achieving that objective, it can look like you going and figuring out what is our vision for this organization and spending the time, effort, and thoughts to curate other people’s ideas and bring them into a compelling vision that you didn’t cast to the team. It can also look like, “Let’s get in a room. Let’s whiteboard through some crucial questions and make sure that we’re defining where we’re going.”

If you do that, I’m hesitant around the whole idea of vision by committee. If you’re going to do that, make sure that the people in the room are people that you’re going to want in the organization for the long-term. I had someone not long ago, they told me on a coaching call, they came excitedly. They’re like, “We’ve got our vision. I’m excited.” I asked him the exact question you asked. I said, “Did you go off by yourself and find it and then got the team on board? Did you ask the team?” They told me, “I sent out a Google survey on what our vision should be for the organization.” Some of the people had worked there for two weeks and they were filling out this Google survey to talk about where the organization is going for the next ten years. That’s dangerous territory. You don’t want to do that. Make sure you’ve got the right people in there.

To elaborate on what you said, we speak to leaders all the time. They would say, “My team is pushing me towards this, towards that.” At the end of the day, if you are the leader and it’s your organization, you’ve got to be comfortable in your own skin. You’ve got to be able to know that where they’re taking me or they’re trying to help me get to that’s where I want to be. Sometimes you could see a leader starting a company and their people are deviating from the original vision to somewhere else. Maybe it’s worked for the short-term or the long-term plan. This leader doesn’t even want to be serving that community or sector of business and whatever it is. I think it’s important for our audiences to evaluate if they are not capable of developing their own vision, they need strategic help.

They could reach out to groups and masterminds and other organizations that help you. Even if you want to include your team, you have to constantly have to ask yourself, “Are they taking me to a place where I could visualize myself being there?” Not something that I’m not comfortable and I’m not talking about audacious goals where I’m not comfortable seeing immediately that we want to be there. I’m seeing being servicing in that space or being my company to be that space because the leader has to be able to be in the driving seat of everything. Correct?

I think that’s correct because if you’re not in the driver’s seat, the opportunity will be. The dangerous thing about opportunity is that you will pursue it. You’re a business owner, you’re going to pursue the opportunity. You’re a leader, you’re going to pursue opportunity and you will pursue every next best opportunity up to the point that you reach this top of the mountain only to realize it’s not a mountain you ever wanted to climb. I’m hyper passionate about people deciding on the front end what mountain do we want to climb? That when we get to the top, we’re happy.

[bctt tweet=”The primary measure of effectiveness in leadership is not your performance; it is your ability to make other people effective.” username=””]

I want to ask you another question, which is a little deviating from where we are, but it’s nevertheless important. We find two types of people out there is way more, but I’m saying in the context of this conversation, they are people that are almost like born leaders. Even without having a single employee, they have that leadership mindset. This is the type of information that synchronize with them. This is where they try to pursue and this is almost like they’re leading. They don’t have any followers so far.

There are entrepreneurs. By nature, they’re not leaders. By nature, they’re creators. People that are seeing a petunia in every step of the way. Every time they see a stone, they figure out what could I do with that stone? How could I make something out of it? A lot of those entrepreneurs are founders of companies that are potentially being put in that position to be leaders. What advice would you have for people reading this show? How do you transition from that? Open-ended entrepreneur to now focused leader and those to grow this business that you’re trying to grow.

Dave used to always say that he’s been to the hospital when babies were born and they say that it’s a boy or a girl. He’s never been there and they say, “It’s a leader.” There are certain people that are wired for leadership. That’s important that we all recognize that and like all of us are wired for certain things. As you said, some people are wired for entrepreneurship, but what you’re hitting on is crucial because a lot of times we confuse the two. We think that entrepreneurship is leadership and we think that leadership is entrepreneurship. That is not true because the skillset it took you to start your company is not going to be the same skillset that it will take you to sustain your company.

If you’re going to build this thing beyond yourself, you’re going to have the focus on systems, processes, delegation, operations and empowering other people. Your greatest skillset as an entrepreneur is that you do the work, but the whole point of building something bigger than yourself means that you can’t always do the work. I’m smack dab in the middle of this. We started this business and I wasn’t anticipating this, but the opportunity came out of nowhere. I ended up hiring my first coach within the business. It was super exciting but what I realized almost immediately is that it’s no longer enough for me to have a strong skillset. My measure of effectiveness is for this individual to have a strong skillset.

More than any other time in my career, I’m having to spend more time training, developing, communicating and intentionally thinking about not my success, but the success of that individual. That’s the shift that must take place, but I’ve heard Tony Robbins said this line before he said, “You either need to find someone that can help you lead this business or you need to tap into the part of yourself that can lead this business. Recognize that part of yourself is not the same part of you that started this business, but it is a skillset that can be learned and developed.”

I think once you get to that understanding, you have that shift in mindset, then you get it down to practical. How do I do it? What do I start doing it? How do I start doing it? What would be some practical advice you would tell the person that’s now making that transition, they’re starting to hire. Maybe they already hired 1 or 2 people. What would be some practical pointers that you would tell audiences how they should start that leadership process?

The first thing I would say is to develop roles around outcomes, not tasks. This is front of mind for me right now because I was writing about this for LinkedIn. We as leaders need to be delegating outcomes to highly qualified and highly creative individuals. You can only do this if you’re hiring the right people. If you’re not hiring the right people, this is going to be a bad strategy. If you’re hiring people that are Patrick Lencioni’s humble, hungry, smart, then what they do not want is to be treated like a robot. If you treat them like a robot, they know one day their job is going to be done by a robot and that no one wants to feel that way. They want to be relied on. They want to use critical thought.

They want to be able to use creative thinking and creative problem-solving. How do we rely on that? We delegate outcomes and not tasks. The best way I’ve heard this explained is say that you’ve got someone that’s in a janitorial position. Let’s use a basic example. If you’re going to delegate them a task, the task is sweeping the floors. The outcome that you’re delegating to that position is clean floors because when you give someone an outcome, you’re relying on them to think of the most efficient and the most effective way to achieve the desired result. You’re saying, “Those floors are your small business and I want you to act like an entrepreneur. You are going to care about those floors more than anyone else in this building because those are your floors.”

It’s crazy how when you give people an outcome, they immediately start becoming engaged in the work that they’re doing because they know that they have agency of over how it’s achieved. That would be number one. Number two that I would say once you establish those outcomes for every role, and we can dive in more to this if you would like to establish a consistent cadence of deliberate communication within the organization. Clarify the roles and then a consistent cadence of rhythmic communication.

I want to add a story that I can’t hold myself back on. You mentioned about the outcomes. We have the latest form where we teach a lot about leadership. One of the things we teach is DRI which means Direct Response Individuals. Every outcome has that direct response individual. Somebody was having an issue with that. The warehouse was all over the place. He felt that he has hundreds of thousands of dollars of inventory sitting around when he makes reorders because it’s not accounted for. We ask them, “Don’t you have a warehouse manager?” He said yes, but the person is busy. They can’t fulfill their orders. They can’t clean up the warehouse.

I told them the following, “Sit down with him the next day and tell him the following. If you’re too busy, then we’ll hire someone but that person will be hired by you because you are the warehouse manager. Give me until the end of the week, think it through. Do you want us to hire someone or you want to be able to hire someone or you feel that your team now could manage it?” He called me up weeks later and he says, “I have to tell you the rest of the story. I had that conversation. The person told me to give me a few days to figure it out. He said, ‘No, I think we could find our way. We don’t need to hire anybody.’” Not only did he clean up the warehouse, but he also made a process that it shouldn’t happen again.

I get passionate about that because it’s creative problem-solving. It’s leadership. One conversation unleashed potential in that entire organization that they didn’t even know existed. That’s powerful.

What I took out of it is the second you told that person, he knew that he’s the manager of the warehouse. The second you told the person regardless of who we’re going to be hiring, that person is working for you because you are in charge of the warehouse. If the warehouse is a mess, you are a mess and that person took it. If I’m the mess, I need to clean up my mess. I’m going to better make sure it doesn’t happen again. That’s the power of it and speaking about outcomes, we need a clean warehouse. How you get it? You want to hire someone. You want to find a way to do it. That’s powerful. I want to move back to the topic that you asked me if I want to elaborate, which is communication. It’s important. I feel that we live in a world that is digital and there are different forms of communication. We have text message, email, phone calls, one-on-one face-to-face meetings and so on. There is much broken in communication. I would love to hear from your experience, working for an organization that is well-oiled in that sense as far as growth and bringing everybody together. What would you say now that you’re working in the Path For Growth for other leaders? How do you create a format that you’re not wasting time with meetings but yet you’re effectively communicating what’s happening and where we need to go?

I think it ties in perfectly to what we were talking about before this is outcomes. I never want to tell people, “For your organization, you need to have this weekly meeting. You need to have this daily meeting. You need to have this monthly meeting and you need to have a quarterly this.” Different organizations operate differently. Different industries operate differently. What I always think about is if you are going to be an effective team and leader, these are the outcomes that your rhythm of communication needs to be achieving. Outcome number one is you need to have a rhythm of communication that is intentionally dedicated to reinforcing and refining the culture of the organization.

This is why we exist. This is where we’re going and this is what we stand for. That is culture. When we start to live into those things, your mission, vision and values, that’s where your team starts to reach what Pat Lencioni calls an advantage. You have a great competitive advantage because your organization is not smart, it’s healthy. Number one outcome is that cultural unity and we need to establish rhythms that will create that. Number two is accountability. There too often, people try to establish expectations for roles, but then they do not hold people accountable to those expectations, and in doing they hamstring the individual and by extension the hamstring the organization. We need to make sure we set clear expectations and then we need to apply rhythms of accountability to make sure those expectations are achieved. Maybe you’ve experienced this, accountability can mean many different things to many different people.

I went through a part of my career where I heard the word accountability and it scared me. I thought it meant punishing someone. Accountability is serving someone. It’s saying, “For this thing that you’re responsible for, for warehouse management, where would you say we’re at? Red, yellow, green?” They say, “We’re probably yellow.” You say, “I agree. Is there anything I can do to help you make it green? What would it take for us to make it green?” That’s what accountability looks like. Serving the individual by making sure that they’re operating at their absolute best in their given role. Number one is culture. Number two is accountability.

Number three is going to be the basic same page status updates that a lot of times are accomplished through maybe weekly or daily to say, “Here’s where we are if you have any questions,” things like that. I think that there needs to be a rhythm of caring about individuals as individuals. That always occurs in one on one meetings. I will tell you because I’ve experienced this with the small businesses that I work with, but I’ve also seen this at Ramsey Solutions. I’ve now established it at Path For Growth. Your organization will exponentially improve if you go from not having one on one meetings consistently to having them. People start to learn that you don’t care about them as units of production, you care about them as people and that makes a difference for your team.

[bctt tweet=”Entrepreneurship is not leadership. The skills you need to start your company are not the skills you need to sustain it.” username=””]

In our company, we run a little bit on the EOS platform. One of the things that you got to attend, which is the level ten meetings, those Tuesday meetings. One of the most powerful pieces of that meeting is the scorecard. It’s the bird’s eye view on a set of numbers. That alone is not enough. The follow-up meetings one-on-one to say, “I saw those numbers. How can we do to help? What can we do to help? How can we improve it?” It’s valuable because people don’t feel they’re alone at it. They feel that they have the support of the leaders. They feel to have the support of their peers. When people feel that everybody’s there to support them, they perform better. I always say this and nobody told me that I’m wrong so I’m going to continue to say it, which is 99% of people come to work because they want to perform. Maybe 1%, but we’re not talking about the 1%, but 99% of people want to be successful in what they do.

Either they’re not fit for the job, which then you set them free as Dave always says, and it’s perfectly fine. You can stay with friendship. However, most of the time it’s the leader and not giving them the proper feedback on how to improve and it becomes emotional instead of factual. You could have a person that, “I am busy and the business wouldn’t survive without me.” The business owner, the leader is saying this person is not doing their job and they’re far apart. Why? Because their outcomes are not clearly defined and therefore that person confused busyness with effectiveness. All of a sudden, they’re all over the place versus a person saying, “This is the outcome we expect. Anything in between, it’s great.” You’re a great asset to the company, but you’re not delivering that outcome. When you want to have the KRA reviews and you want to have those one-on-ones, it becomes emotional. Somebody goes out hurt versus, “These are the facts. Let’s work on a plan to perfection.”

I was working with the owner of a gym and one of the things we were talking about is he talked about exactly what you’re saying. He talked about how they’ll do these one-on-one KRA meetings and they will become emotional. We talked about why that was because he was working with a lot of young people. These are twenty-somethings. A lot of times college students said this is their first job in their career and a lot of times the school system does not properly set us up for accountability. A lot of times the school system, if you study for the test, you get an A, and that’s your entire track record. You then sit down at your first job and the teacher, the boss or the leader looks at you and says, “You’re not passing spec.”

It’s soul-crushing. It’s like, “I’ve never experienced this in my entire life. I always get As. I’m an A-plus student.” What we need to recognize is it doesn’t need to be emotional. We need to take the expectations. We need to take the results. We need to take everything the role is responsible for, we need to put it on the table, and we’re going to talk about that. We’re not going to talk about you as a person. We’re going to talk about the results. When you depersonalize the results from the individual, that is a powerful method of accountability. Alan Mulally was the former CEO of Boeing then transitioned to Ford. He left Boeing, which is a world-class organization to go to Ford whenever Ford was a mess.

He architected the Ford turnaround and has now spoken, written and talked a lot about what it was like to turn Ford around to being back to being an iconic American brand when it was a little bit of embarrassment for a long time. It’s one of my favorite leadership talks I’ve ever seen and he is one of the most remarkably humble and down to earth leaders I’ve ever seen speak. I’ll never forget he was telling the story about whenever he got to Ford, he said, “We’re going to start having a regional managers meeting.” It was something like ten managers around the table from globally. You’ve got your North American manager or director. You’ve got your Asia director. You’ve got your Europe director. All of these regional directors of Ford in a meeting.

He said, “We’re going to meet and we’re going to figure this out together.” He got there and Ford is projected to lose $13 billion in his first year. He said, “We ended up losing $14 billion so we beat the goal.” That’s what he said and he laughed about it, but he sat down and he would sit down in these meetings and he would say, “Let’s go over certain processes, certain operational objectives for the organization. Let’s see how each of you is doing within your region and then we can have a great discussion about how we can help each other. Let’s do it simply. Red, yellow, green, how are you doing in this area? Red means we’re a mess in this area. We need help. Yellow is not where it could be, but it’s also not red. It’s not on fire. Green is we’re healthy. We’re thriving in this area.”

He goes around the table. Every single director says they are green in every single area. He looks at them and he says, “We’ll meet again next week.” They meet again next week and every single director is green in every single area. He looks at them and he’s like, “We are projected to lose $14 billion and you’re telling me that everything is okay, healthy and thriving? There’s got to be something wrong here, so we’ll meet again.” They keep meeting. You’ve got to think that people are traveling. It’s messing up people’s schedule, they’re coming in and they go around. Several weeks in, they go around again. Everyone is saying green and then there’s one lone soul that says, “To be honest, in this particular area in our region, we’re red.” He said, “Thank you.”

He stood up and he went like this, “Let’s put that problem on the table and talk about it.” Within fifteen minutes, because they were able to collaborate around something they defined as an issue, they were able to move the thing forward. He called the guy and he said, “We’re going to meet next week. When we meet next week, I want you to sit in the chair right next to me because I want everyone in that room to see that when you said it was yellow, that was not a stain on your report card. That was the greatest sign that you are someone that I can trust.” They showed up for the next meeting. This guy is sitting right next to him. They start going around and everyone says yellow, red. He said, “Now we’ve got something we can work with.” I think that is the most perfect illustration of what it looks like to put the results on the table so that the team can confront negatives instead of ignoring them.

It’s important and I think it goes back to what we thought before the story, which is that people feel it’s emotional. It’s going to reflect badly in my report card. If everybody’s aligned with the mission and vision of the company that we need to take this company forward. We got to address the elephant in the room. We’ve got to bring it up front and try to tackle it one at a time, otherwise, I always use the analogy of a parking ticket. If you get a parking ticket and you take it into the car, it doesn’t go away. It only builds interest in it. Nobody’s parking ticket disappeared because you took it out away from a windshield. You’ve got to take care of it.

The same as with business challenges, if you do have those yellows and those reds, most of the time, unless you’re lucky, they’re not going to disappear without any work in it. This was a fascinating story. I appreciate you sharing it. Our audience will appreciate it because it illustrates the point of taking action as a leader. What I also took from the story is if you’re a new leader, he could have been there the first meeting and start dismantling the team and saying, “How could it be?” He gave them the space to realize it themselves. He gave them that space that they should come forward because that’s the best way of a leader to achieve what they need to achieve is that brings the best out of their people. I think what better way of closing this episode is with that statement where people reading to this episode to understand that leadership is about coaching your people but ultimately giving them the autonomy to focus on the outcomes.

Be there to inspect what you expect, but not stand in their way. Otherwise, you’re going to create robots maybe, but not people that could thrive in your company and your organization. Thank you for that. For our audience, I want to tell you that there’s so much in this episode that you should go back and read more than once. I know that Alex has launched his Path For Growth. Let’s close with four rapid-fire questions. Number one, book that changed your life?

The Second Mountain by David Brooks.

Number two, piece of advice you got that you’ll never forget?

Good leaders hold you to the standard of others. Great leaders hold you to the standard of your potential.

Number three, anything you wish you could go back and do differently?

Spend less time worrying about what people think.

Number four and final question. What’s on your bucket list to achieve?

I want to build a multimillion-dollar business that is serving people exceptionally well and making an impact nationally on the way our country views leadership.

Thank you for joining us. I know your time is valuable. In the name of our audience, we will forever be grateful for sharing some of your time with us.

I appreciate you. Thank you for having me.

It was a lot of fun. Thanks.