Change Proof Podcast | Thomas Douglas | Adapt Or Die

 

Adapt or die. Pivot or perish. Innovate or evaporate. Whichever way you want to say it, it means the same thing – whether it’s in life or in business, we need to keep moving to keep living. Thomas Douglas knows this all too well from his rich experience in business leadership. In this episode, the CEO of JMARK and author of Adapt or Die, joins Adam Markel in a wide-ranging conversation on different topics, including personal development, innovation, resilience, leadership, and business success. Tune in and learn what it really means to build resilient organizations that will help make sure your legacy lives on long after you’re gone.

 

Show Notes:

  • 01:26 Tom’s Origin Story
  • 07:27 Adapt Or Die
  • 17:04 Building A Resilient Organization
  • 22:26 Innovation And Technological Transformation
  • 30:40 Preparing For Transition

Get the newest Change Proof Podcast episode delivered directly to you – subscribe here. And, if you’re enjoying the podcast, please give us a 5-star rating on iTunes! For instructions click here.

How do we leverage continuous uncertainty to thrive in this unprecedented new world? 
The answer is to build the resilience we need to power us through the challenges we face so that we become “Change Proof.” Prepare to tackle the future with confidence by reading Adam’s latest book Change Proof: Leveraging the Power of Uncertainty to Build Long-Term Resilience.

Watch the episode here

 

Listen to the podcast here

 

Adapt Or Die: Reflections On Resilience, Innovation, And Business Success With Thomas Douglas

I have an amazing guest. His name is Tom Douglas. I respect this gentleman quite a bit. You’re going to enjoy this conversation. Before we get there, let me share more about him. Tom joined JMARK in 1997 after serving in the Navy, where he was recognized with multiple awards. As a level-one engineer at JMARK, he worked his way up the ranks before purchasing the company in 2001.

He had to make some hard decisions and downsize the organization to only six people. With over 120 employees, JMARK is a leader in its space, having hit Inc. Magazine’s list of the top 5,000 fastest-growing private companies nine consecutive times and has also been awarded the number one best place to work in Southwestern Missouri. He is a trusted technology advisor to global lists of clients and often speaks on topics such as culture, people, puzzles, technology efficiencies, and cyber security. You’re going to love this conversation. Sit back and enjoy my discussion with Tom Douglas.

Tom, reading somebody’s bio is always fun for me. I love it in a variety of ways, mostly because I’m thinking, as I am reading it, how it was put together, what was purposely put in, and what was left out. My first question to you is, what is one thing that’s not part of your introduction or bio that you would love for people to know about you?

The first thing that comes to mind is how many times I screwed up and failed before we were able to get anything right. Your bio typically is a summary of your successes, but it doesn’t list the hundreds of things that you got wrong along the way before you were able to get a few things right. I’m humbled every day that we have the opportunity to do what we do and work with the people that we work with because we screwed many things up before we got it right. I remind young entrepreneurs and people that we’re coaching. Nobody at JMARK gets fired for making a mistake. It’s not learning from the mistakes that lead to an exit. We want to encourage people to lean into that, make mistakes, screw up, and be better as a result.

Make mistakes, screw up, and then be better as a result. Click To Tweet

Tom’s Origin Story

I want to talk about failure. Before we do that, I want to get the origin story set up for people so they understand who JMARK is and how you came to be. If you give us a little of that context, we’re going to dive into what is that f-word that people do not dig.

It’s a fun but challenging story, like many small businesses I went to straight out of high school. I went to college. I wasn’t sure what I wanted to do, but I spent a couple of years dorking around in college and didn’t find my why and what. I found myself floundering around. I decided to get my life in order, and I joined the Navy with aspirations to be a SEAL. I figured out that wasn’t quite my calling, but I was given the opportunity to work with some incredible people. I got to work with some people who were less than ideal as a leader. I learned both what to do and what not to do in a leadership role.

I found my way into technology because I didn’t like the way that we were managing some of the databases in the environment. I decided to write my own around Min/Max levels, stocking levels, and financials. I fell in love with this whole idea of data and data being able to tell a better truth and understand the facts of an environment.

I was going to reenlist in the Navy for several more years. I had my Navy chief at the time who came to me and said, “You need to get out. There are a lot of people that can do what you do in the Navy. You’re going to go out, create a business, or do something, and it’s gonna have a bigger economic impact on our country than you can have sitting here in the Navy. I was like, “Whatever.”

I had no aspirations to be a business leader or do anything like he was describing, but he was like, “You’re destined for it. I followed his advice. I got out and joined JMARK as a level-one engineer. I thought I knew a lot about tech because I’d gotten certified and done all the things. I came in thinking I was all that in a bag of chips and figured out I was a chip. That wasn’t all that.

Not the whole bag.

I had some great coaches and mentors. They helped me navigate through all of those things. Through my experiences in the Navy, I was able to put some processes in place and some repeatable experiences that led me to a service management role. The guy who formed the organization originally, the founder, was a gentleman by the name of James Montgomery Jr. He was at a place in his life where he needed to leave the business. It was struggling. He said, “Do you want to buy the business?” I was like, “Yeah, why not?”

With my dad and family members, we were able to reinvest in the business. We had to downsize it to about six people in the company. We have rebuilt it from there. We rebuilt the business model. Now, we have 125 people in the company and are going strong. It’s been quite the journey, but it’s been a lot of fun.

This is the snapshot of success. Often, we don’t talk about the failure. I want to go back to that for a second. You could tell any story of failure you want. I’m happy to have you do that. We’re all voyeuristic when it comes to that, like, “Tell us the ugliest thing that’s ever happened to you.” I’m fine with that. I want to track from a leadership and a senior leadership perspective how important failure is because it is a trope. It has been said before, and I don’t know why people buy into the idea of how important good failure is.

What I would add to the context of failure is it’s the impetus of wisdom. When we don’t have failure in our life, we don’t have the experiences. The times when we weren’t good enough for whatever reason, we lost the business. We let a customer, an employee, or a teammate down. All of those circumstances, we’ve all done them. It’s through those situations and circumstances that we gain the wisdom to be better as leaders to inform, guide, and coach them in the future.

If we can eat enough humble pie as we’re going through those experiences to carry it forward, make better choices, and avoid making the same mistake multiple times, it leads to an organization and a leadership style that focuses on gathering of wisdom rather than focusing on process and do what I say.

When there’s wisdom behind what you do as an organization through that experiential learning, it leads to outcomes because there’s a why and a story. Let me tell you how I came to this conclusion. That method of helping people navigate through situations is incredibly meaningful and powerful for them.

Adapt Or Die

You’re an author and got a book. Does failure play an integral role in how you teach others how to lead?

Change Proof Podcast | Thomas Douglas | Adapt Or Die

How to Create Innovation, Solve People Puzzles, and Win in Business

The foundation of why I wrote Adapt or Die is because I’m a big believer in learning from other people’s mistakes and watching other companies and leaders in terms of what they’re doing. It’s also because we had several years’ worth of incredible wisdom-building or experiences that were not good. If we can share that wisdom, pay it forward, and help an entrepreneur navigate through it, solve a financial problem, a people problem, or a process problem, we can help accelerate their success. I’m a big believer in rising tides lifting all boats. If the book I’m sharing with somebody helps somebody in Australia on the other side of the pond, that will positively impact the world.

It’s a driver and a motivation internally, intrinsically, to write and share content because, it’s never a month goes by I could say this truthfully, that we don’t hear from somebody somewhere around the world that says that the book I’ve written or collaborated on has had an influence that made a difference and helped create that ripple effect.

There’s part of it that I want to dig more. At the idea level, everybody understands the importance of making mistakes. At a visceral level or level of programming, we learn from the time that we’re young that mistakes have consequences and often cause pain. We live the bulk of our lives trying to avoid experiencing the pain and the consequences of those mistakes. It’s counterintuitive because let’s call it for what it is.

From a financial standpoint, the majority of the world is not living financially successful or in a successful, what they would define as successful. From the standpoint of business, more businesses fail than succeed. That’s always been the case. I feel like if we’re going to give people a bullhorn, the wisdom of our age or experience, we would say, “Don’t overlook the importance of failing.”

Don't overlook the importance of failing. Click To Tweet

It’s not like I’m saying you should wake up in the morning and go, “How do I fail now?” You have to recognize, on a subliminal or subconscious, that, at the level of programming, we avoid anything that might lead us toward failure. Whether that’s somebody who’s starting a business for themselves, an entrepreneur, or even people in mid-level or senior-level leadership roles within an organization, organizations adapt, die, pivot, or perish. They innovate or evaporate.

I’m a big believer that whether it’s God, the universe, or whatever is in your belief system, we are put in a situation to go through experiences so that it will lead to something positive in the future, a better outcome. While we may fail, we have challenges, and let someone down in some capacity, even if that’s ourselves, what we learn from that is if we don’t live in the past and we don’t live with all of the regrets, and it’s like, “I learned this lesson, how am I going to play that forward? How am I going to pay that forward? It becomes that gift that keeps on giving. It creates an opportunity not only for us to be better for it but for us to share that wisdom.

To your point of living through those circumstances, you don’t get in shape, and you don’t do anything positive with your life without sweating. In terms of ego, as humans, we have the tendency to shy away from having to work to get something we want. The kids that go through, and they get the participation trophies, whether you blame it on that or on parents who don’t let someone fail because they don’t want to see their kids suffer, all of those things are challenges that we have to learn to overcome if we’re going to be successful in business because it’s the best teacher.

Change Proof Podcast | Thomas Douglas | Adapt Or Die

Adapt Or Die: You don’t do anything positive with your life without sweating a little bit.

 

If you don’t screw some stuff up, you don’t know what risks you should take, or you shouldn’t take. Kodak is a perfect example. They thought they owned the market and nothing was going to happen. They were the first to use digital film technology. They had a digital camera. They squashed it. They didn’t want to change their business model because they were afraid. They refused to think that they could fail because they hadn’t gone through enough small failures along the way to recognize that it’s a company made of humans. Look what happened.

That’s a classic case study. They didn’t want to cannibalize their own market. The irony is that the technology they created is a technology that ultimately took them out of business. I forget what the numbers are. It’s been a while since I looked at that case study. On the day that they were going bankrupt, Instagram was valued at $20 billion. On the same day, these two things were coalescing.

I’m going to let this go in a second here, but I am like a dog with a bone sometimes. If I went and looked at each mistake I’ve made and if I had the magic wand to undo it, I would on one condition that I wouldn’t lose the lesson and what I learned about it in the process, because sometimes our mistakes lead to hurt, pain, the suffering of your own or other people’s, which is worse. If you scuttle a business and people lose their jobs or you make a mistake as a leader, you have to let go of a bunch of people because you can’t make payroll and the realities of business.

I’m not talking about small business. That happens all the time. We’re talking about big, publicly traded, multibillion-dollar companies that are higher up during one market phase. They go through a whole different cycle when that market changes, which often involves the pain of people losing jobs or a whole bunch of other transitions. There are consequences to these kinds of things, but I would never give up the experience of having been through that pain and suffering because I know that to do that would mean that I wouldn’t know what I know now and what I know now would never lead me down that same path again. We will make new mistakes.

The goal is an evolutionary process. The things that don’t evolve devolve. Anything that stagnates becomes toxic and leads to death and disintegration. Even a company like Lehman Brothers, I mean, there’s a great failure for you. They were the most highly regarded investment banking firm of their day and had been for many years. No one would’ve bet at the beginning of 2007 that that organization would implode. Whatever the odds in Las Vegas were, they were billions to one, yet that happened.

Building A Resilient Organization

Organizations must continue to evolve. There are a number of things that factor into that. I use the word resilience to describe this concept of sustainable persistence plus adaptability to use the term that’s important in your book. The sustainable is key because you have to persist. People have heard that before. It can’t be the persistence or perseverance that leads to depletion and burnout. If that happens, the capacity to adapt, take your licks, have your humble pie, and move forward, they don’t have the energy to do it. That’s why people quit because, at some point, they’ve run out of steam.

I want to get your take on any of that, including how it is that you’ve built resilience into the organization that you lead and your own self-assessment of how you are all doing in regard to that. You came through the pandemic, and your organization was essential at the beginning of the pandemic when people didn’t know how they were going to get their business online and work in a strictly remote environment. You and JMARK stepped in and met that challenge head-on while everything was shut down and in lockdown. That’s a good starting point.

We saw a massive shift, as we all did, through the beginning of the pandemic. It was overnight. Here’s the ironic set of circumstances. We were in a building that we had been in for quite some time. We loved the building, but we had outgrown it. We were trying to find a new place and hadn’t found one yet. The landlord wanted to retire. He wanted to sell that building, but he needed a long-term lease. I said, “I can’t sign one because we’ve outgrown the building.” He leased it out from under us.

Before the pandemic, we had to go because we didn’t have a home. We had to go to a full remote workforce. We had gone through this whole process of exiting, building, and moving all of our team to work 100% from home temporarily while we tried to find a new home. It was about at that moment that the pandemic hit. Whether you call it divine intervention or other things, we didn’t have to pivot because we had gone through it. We had all of those lessons to learn from in terms of the challenges the businesses were going to face. We were able to lean into it and help to move a hundred and some odd businesses to work from home within a matter of weeks.

We installed more laptops, servers, and whatever we had to do to facilitate that. Our team was incredible. They stepped up, met that challenge, and navigated through what it meant. What we’re still learning in resilience is how you refuel the jet while it’s in the air rather than having to come crashing down, refuel, pause for a while, and keep going.

What we’ve been trying to learn from you, and in our own world, is we have to be sustainable, which means that we have to be able to recognize the tolerances of our people at different phases of their life with different priorities and sometimes conflicting priorities as it relates to kids, health and other things that happen in family dynamics. The gift that we’re gaining an appreciation for is building that resilient organization that recognizes where people are, what’s going on with the business, what talents, and what skills and capabilities we have to build.

We can let people breathe for a moment. Even in the middle of the day, they can continue to do it, whether it’s taking a walk or forcing people to use their PTO to help them be in the right mindset to navigate through the challenges of technology, business life, and all the things that are thrown at us. We are and will always be a student when it comes to getting this right, but we’re getting better all the time in terms of helping and coaching our team through what it means to run a business that respects the whole human and creates an environment where they can be successful.

How does your organization handle change? Where has it been strong in that area, and where has it potentially been something other than that?

When it comes to the adoption of technology, that’s something we have to deal with every single day because that’s what we do. We’re good at that. We have opportunities to continue to grow on the people side, keeping our policies up to date, managing, leading, and thinking about PTO and paternity leave. Because we’re always dealing with the shiny things of technology, it’s this other piece of people’s stuff. Sometimes, it doesn’t get the same level of attention.

As an organization, we’ve implemented, in the last couple of years, a team inside our company called the culture crew. Their whole job is to surface these issues from the frontline. It’s a volunteer team. Their whole job is to make sure that we’re staying on top of these areas of business and be like, “This thing is stressing people out. This is something that I hear about that’s worrying this group of people. This is going awesome. Let’s do more of this.” That team brings those things to the table. It helps us to lean into it instead of waiting for somebody to quit or have a blow-up before we hear the story of how we let somebody down.

Innovation And Technological Transformation

How has AI been adopted or being embraced? What’s your take on where it is inside of JMARK? You are touching many other businesses because you’re their technology solution. We’re in the first inning of the AI revolution and transformation. I would love to get your own assessment, both internally and externally, about that.

We are leaning into it and embracing it as an organization, but we’re doing it with a lot of caution because there’s a lot of unknowns around security as it relates to how that’s implemented. Our current policy is that we don’t put any customer and own name. If you’re working on something on ChatGPT, you have to anonymize all of the data before you work on it because there are still things untested and unproven related to that.

There are enterprise agreements that you can put in place with these organizations, which give you more security and control over that. Because it’s undefined, we’re treading carefully as it relates to sensitive data. The other thing that I’ll say is that most people don’t yet have an appreciation for it. There’s a public side of the Open AI, ChatGPT, and Bard. There’s private AI. Both of these have been going on for years in terms of their development in the last couple of years.

In the last several months, the revolution that you’re talking about is we’ve gone from an environment where you had to be a developer to ask a computer to do something, or you had to be trained on how to interface with it. You can use plain language, and it understands what you’re trying to do with it.

The public environment and the ChatGPT, you can use for a thousand things, whether it’s a blog post, job descriptions, simplifying contracts, summarizing contracts, finding new language to solve problems, and graphic design. There are massive amounts of accelerations. All those things live in that public domain, but there’s also an incredible capability technology that’s available now that’s more private, but it involves your own data.

It works with Microsoft, Google, IBM, and other organizations. You can take your groomed data and put it into some of these AI models to get the truth out of our customer sentiment or the banking environment. You could take three years of a trial balance for a business, throw it in there, and say, “Show me what would happen to this business if they had a 10% growth in revenue and a 5% reduction in cogs. What would happen if they had inflation of 7% and a decrease in cashflow by 5%?”

You can run these models in plain language against the trial balance to test the risk tolerance of a particular business. In an analysis, having to spend hours and days running these models, you can do it in a matter of seconds. We’re going to see incredible changes in advancements in financial management, healthcare, health management, and troubleshooting, including the human body.

The former lawyer in me still wears that hat frequently. I get it that we’ve got good guardrails, or companies are trying to build guardrails for this thing. On an organic level, we don’t have enough guardrails. There are a lot of people who don’t believe that to be the case. Do you think people are ready to embrace this disruption? This is a personal question.

It’s a mixed bag. Some companies are going to embrace it and do incredible things with it. They’re forecasting that it’s going to have a $13 trillion impact on the world economy in a positive way. That is going to shift jobs. When you have the Kodaks of the world who board instead of innovate and lean into it, you’re going to see some disruption in those environments.

We want to encourage people to get out of the fear mode and start testing and playing with ChatGPT. Go to PI.AI and start having a conversation. It is written to be an AI conversation bot, and it’s incredible. Start getting comfortable with it. I would challenge people to think and consider that if you had to run your business now without a calculator and Microsoft Excel, you would find it troubling and challenging to run your business. Several years from now, that’s going to be AI.

While we see some people running for it, we see others that are like, “I’m going to wait and see what happens in my industry. I’m not going to do anything.” That’s a risky position because it’s moving faster than the adoption of the internet back in the day. When you think back to 1997, 2003, and 2004, when the internet went boom in that period of time, we’re going to outpace it by ten times in this impairment. While some are shying away, it creates more risk to not embrace the technology than leaning into it, doing some initial testing, and getting comfortable.

It actually creates more risk to not embrace the technology than leaning into it and doing some initial testing and getting comfortable. Click To Tweet

It comes down to mindset. We spend a fair moment talking about that and how people are programmed to see threats. The threat is a good word in the space of security and tech. It’s interesting because there has to be harmony between recognizing legitimate threats and, at the same time, having this openness to change. Without that openness to change innovation, bottlenecks. At some point, it gets choked off. Slowly, now or later, this leads to the disintegration of a system. I appreciate what you said there.

It’s a different topic, but I’m curious. You’ve grown the company, and the company is doing well. You are a young man. I don’t know that you are thinking about succession yet, but I’m sure there are people in a span of time in their careers who are not yet thinking about it but will or are already. From a leadership succession standpoint, what is your philosophy about that? Have you started to think about how it is that you train the next level of leaders that would bring JMARK to that next level when you might not want to be as day-to-day in the operations or if you were to have transition yourself and see the company sold?

Preparing For Transition

It’s an incredibly important question and one that I do spend a reasonable amount of time thinking about. It starts with developing a value-creation strategy for the business. What do you want the business to be worth at the time that you do exit? I would encourage most entrepreneurs, whether you’re young, middle, or have been in the game for a while, to be thinking about your value creation strategy.

If bad things happen, you get hit by a bus or a major health event, and your business isn’t worth what it needs to be worth for you to be for your family to be in a place to continue the lifestyle and make the decisions that you want them to make in the future, you’ve let them down. It’s an inherent responsibility of an owner of a business, an entrepreneur, or someone responsible to those stakeholders to be thinking about what they want the business to be worth in what period of time.

It is that value creation strategy and thought process that leads to understanding the need for growth, margin management, financial oversight, and the roles that you want to have in the business to make sure that those things are happening in a healthy way. I’ve heard this story many times. It makes me cry inside each time people say, “I want to retire. I’ve got this awesome business. It does $5 million worth of business, but it’s been run like a lifestyle business, and it’s not worth anything on paper.”

They have nothing to sell. They have no secession planning. They have nothing going on in that arena. It’s a major risk to the business. They go to a business broker, and the business broker is like, “Sorry, we can get a couple of hundred thousand dollars for this business, but that’s it because you don’t have strong enough cashflow. You’ve not built a machine that churns cash to pay back debt services.”

You have to find somebody else who wants to buy a lifestyle business, and you’re not going to get much for that. You can spend the next several years of your life staying in business when you thought you could leave when you’re more tired, and you don’t have the energy to put it back on the rails or on the rails in the first place that it does create the cash to support debt services and creates an exit strategy so that the business is worth something.

This is an area that I knew nothing about many years ago. I had the great fortune to work with some incredible coaches who were like, “Tom, you got to start thinking about this now.” I’m several years away from retirement, and they’re like, “No, think about it now because you owe it to your family to put the company in a position. If something happens to you, they can sell the business, or the business can continue to support them. Whichever the preference is, it’d be okay.”

The way my dad advised me is he said, “You have to have enough cash, life insurance, and future-proofing built into the business for the company to go out and buy another CEO because you’re not going to find somebody like you. You’re going to have to buy them. You’re going to have to pay them top dollar. You’re going to have to give them equity inside the business to bring them in if your company is not set up for health because that’s not what you want.

We constantly train our entire team about what it means to create a healthy business and increase safety in the business. We can make intentional decisions rather than having to make reactionary emergency decisions. We proved that during the pandemic. We had the cash to navigate because we had a lot of people who couldn’t pay us for all the work we did. Our revenue dropped by massive amounts, and our workloads increased, but we knew it was a period of time.

We had to be resilient and persevere, but we had to have the cash in the bank to navigate through that. I was able to stand in front of the whole company and say, “Nobody is going to lose their jobs. We’re good. We’ve been planning for this for years because I had been talking about safety in the business with the company for years. This is what we were preparing for. We knew winter was coming. It’s here. We’ve got our coat on. We’re good to go.

Change Proof Podcast | Thomas Douglas | Adapt Or Die

Adapt Or Die: This is what we were preparing for. We knew winter was coming. It’s here. We’ve got our coat on. We’re good to go.

 

I’m picturing what it felt like in that room. I know you have some companies that are not under one roof, but the bulk of your people are in that one location that I was fortunate to come and visit. I’m putting myself in that room to hear those words and what they must have meant for people playing every scenario in their heads imaginable, like, “Is this the moment when two-thirds of us are being given our notice?”

I want to go back and say that in my work, both now in the consulting and our business, even when I was a lawyer for a couple of dozen years, it is often the case that people who are the founders of businesses have not thought through their succession planning well enough. I mean some big companies. I’m not talking about mom-and-pop stuff.

Because of that, any number of things can happen, but what happens is that the person wants to maintain control forever. It’s baked into their identity and a whole bunch of other psychological stuff. They hang on so long until their energy and ability to see the field and be open are altered in a way that isn’t positive for the business. The business that they’re forced to sell at some point is worth what it was worth even before, is one fact.

The other thing I wanted to ask you about was the way that you might be training those people inside because if you’re not going to go out and buy a CEO, which is expensive to buy a good one, sometimes you could buy a bad one and it costs as much to buy a good one. If you’re going to train that for that succession plan to be effectuated, what does that look like internally? Say as much as you’re comfortable saying. I’m curious. I imagine folks who are reading this going, “Yeah, tell me. How do we do that?”

I don’t know that I got all the answers, but I’m happy to share at least the mindset of the process that we’ve gone through. It starts by having a conversation with your leadership team to say, “I may be at the helm now. The future of this business has to survive past me. It’s our responsibility to build a business that has the capability to outlive Tom. Tom’s true success metric isn’t what happens.” I can put myself out of a job. I can make the business future-proof. They can sustain beyond me. A hundred years from now, people can still look and say, “JMARK is a great company and has a great culture. It takes care of its people and clients.”

If we can be successful in achieving the hundred-year vision of what that is, it’s like, “What are the building blocks that we need to have as an organization to make it that sustainable and have the perseverance built into the company.” As we speak, we’re going through this exercise. My executive leadership team is meeting with them without me in the room. The exercise that I’ve asked them to go through is to say, “If Tom got hit by a bus now, what would we be missing? What are the skills, capabilities, passions, and leadership aspects that we don’t have? How do we build that into the DNA of the organization so that several years from now, if that happens and I need to exit for whatever reason, it’s no big deal?”

We’ve built it into the DNA of the company. There are certain roles, skills, and functions that need to exist within a business. If I have time, I can train the right people to do about anything. What does that group of people look like? How do we need to budget? How do we plan for those roles so that it is not the Tom show, but the JMARK show as it should be?

That’s such a practical step and an exercise. Multitasking with the phone is almost like we’ve grown a sixth finger on a hand, but people are taking notes on that one. That’s practical. Charlie Munger passed away. He’s 99 years old, a couple of months from his 100th birthday. For those who don’t know that name, Charles Munger, you ought to know him, but this is Warren Buffett’s right-hand man and partner. Warren is still around. Charlie was massively important in the growth of Berkshire Hathaway and in his own right. He’s a genius. He would not call himself a savant but smarter than the average bear.

He was talking about succession in his last interview, which was a few weeks before his death. He was asked about succession planning. I’m glad you answered that question. Even for a company that’s worth $500 billion, succession planning is not an easy thing. Thinking about the qualities of the person or persons that will lead an organization beyond its founder or visionary, in your case, is a big deal.

I wasn’t an estate attorney, but I could tell you one thing. I would make this statement that most lawyers do not have wills to this day. Most clients that you talk to, if you ever said, “Do you have your estate plan worked out? Do you have your will and all that good stuff together?” They’re like, “No, you should talk to my partner. You should talk to somebody else.”It’s not a topic for people who want to wake up in the morning and go, “I want to think about my death, or my retirement even.”

I’m glad that this came up for those who needed this goose thing to say, “Start thinking about these things.” Your exercise is brilliant, Tom. You are a teacher. I’ve said this to you privately. I was describing you as a leader. I was in that room with your executive team and saying, “If Tom was gone tomorrow, what would we need to replace?” To me, you need to have the heart of a teacher as somebody who cares enough to get into the weeds about how you teach, how people learn, and how you create an organization that educates because that’s what is required for growth. If people, people aren’t growing, the organization isn’t growing. Does that resonate with you?

I’m as much of a student as I am a teacher. I’m always learning. I love learning. Our conversations do feed into that, and many others do. One of the things that you were saying that made me think back is I like to use the analogy in family dynamics of when you have the conversation about sex with your kids. If you wait until it’s too late to have the conversation, you’re dealing with a messy or challenging outcome.

The same is true when you’re talking to your team about pay, succession planning, and sustainability within a business. If you wait until it’s too late, it’s a big, messy thing to deal with, and it’s not so much fun. If you lean into it and you have that uncomfortable conversation prior to needing to have it, it makes the future a lot better.

When you think about an employee, do you wait until they come in and say, “I got an offer for 25% more?” Do you make it a normal conversation to talk about pay? It’s like, “Before you go out and start hunting, have the courage to come and have a conversation with me and say, ‘I’m at a point in my life where pay has become more important, and I need to make some certain investments or prepare for college. This trip is important to my wife.’ Be candid with me. I’ll be candid with you. If we can make it happen, let’s figure out how to create the value.” Let’s have all of these conversations before they become messy and something that we’re having to deal with instead of getting to deal with.

At the risk of blowing more smoke at you, I’ll say that my read of JMARK is that the culture includes transparency. When you said what you said, “If you come into the office, you tell me I’m about to go into that college phase. I’m going to need to earn more.” That’s a different conversation than somebody covertly looking for a job that pays more. They come to you and say, “Sorry, boss, I found something that’s going to meet my needs better.”

Your culture, because it includes transparency, creates transparency. It’s like the chicken and the egg thing. If it’s not in the mixing bowl, it doesn’t end up in the cake. My feeling is that because it’s in the mixing bowl, and transparency is part of the culture at JMARK, you get people who will be transparent enough to say, “Boss, this is an interesting time of life for me. It’s a joy to have my house back, but the kids are going to college, and it costs $60,000 for a private school per year. That’s my reality.”

It starts with things like you’ve shared already about how you’re transparent with your teams, including about what the company might be like if you weren’t around. A lot of leaders keep those cards to their vest. They don’t share them. They’re not transparent in those organizations where there is that level of secrecy, which is more the norm than it is than anything other. Your secrecy begets more secrecy.

Kudos to you. When one person teaches, two people learn. That’s an old expression, but that’s a good one because we’re both learning. I have learned and enjoyed the conversation, Tom, as always. Thank you so much for being a guest. There’ll be full show notes so that people can find out more about the work that you do in the world, the work that JMARK does, and your authorship. Adapt or Die is a wonderful book. I have that book. I’ve loved that book. I’m going to recommend it to people. You spoke and asked to do that on stages. This is some great stuff that’ll be in the show notes.

When one person teaches, two people learn. Click To Tweet

For our community, if you have a question, please feel free to go to AdamMarkel.com/podcast. Leave your question or comment there for Tom or me. We will not have any AI or chatbot to answer that question. It’ll be us. We love it when you rate the show. If you wouldn’t mind, on whatever platform you consume this show, you could give us a rating. Five stars are lovely. It helps the algorithm to get this content out in front of more people, but your rating is up to you, and we appreciate the feedback. Tom, thanks again for your time. It’s been a blast.

Thank you so much. It’s been a privilege. I enjoyed it.

As promised, in our conversation, Tom and I went into a variety of important areas. I have so much respect for this gentleman, not as a CEO, but for his title and having been an entrepreneur. He’s purchasing the company, seeing it go through some tough times, and being able to make the changes that allowed it to grow to its current position, which is a leader in that space, employing many people. Aside from all those things, Tom is a teacher leader.

One of the things that came up in our conversation the other day is that when any of us teach, there are two people who learn. That’s indicative of who he is as a leader and his humility. He’s always on the path of learning, and at the same time, he’s helping other people to learn through what he’s learned, his own experience, and his example.

I love talking to Tom about what it means to operate a business and all the pushes and pull there. It is an up-and-down road in a lot of ways. You have to be resilient in many respects, operating a company of your own, a private company, or being involved at a public company level or in many other spaces. It’s not for the faint of heart.

We talked about value creation and looking at the value creation strategy for those who operate businesses that want to think about succession, whether it’s a preparation of those that will succeed you, meaning those groups of leaders that will take your place, sit in your seat and be able to move the organization and the team to higher levels as well as those that wish to exit their businesses and create a liquidity event that is meaningful and generationally speaking. A lot of us work in business because we are thinking about our families and the legacy that we leave for them, financially and otherwise.

We talked about AI, the role of resiliency, and how resiliency is created. We talked about Tom’s journey, his specific brand of leadership, the culture that he has worked to cultivate and curate at JMARK, and what members of the team, and how those members of the team have all collaborated in that one effort, getting everybody’s oars in the water, in synchronicity and rowing together to create this greater overall result that benefits more people internally and externally.

I enjoyed the quality, the depth, the conversation, and the breadth of it. We covered a lot of things. If this is an episode that you learned something from, in that light of when one learns, when you teach something or share something, often two people are learning at the same time, my request is that you share this episode with somebody, a friend, colleague, a coworker, family member, or somebody that might benefit from some of the things that you read.

We’d love to get your comments. You can go to AdamMarkel.com/podcast and leave a comment or a question for Thomas or me. If you can rate the show, it’s helpful in terms of the algorithm that people take that moment to give us a rating. I’d love a five-star. Our team would love that. We are empowered by that. Whatever rating you feel is appropriate, we appreciate you taking the time to give us that feedback. It is a collaborative effort. It’s a big community, and we love that. It grows with people who care enough to take that moment and sometimes leave their feedback. We appreciate it.

As a give-back, we’d love to give you something of value. That is to determine how resilient you are in those four specific zones of resilience at this moment. It’s something that we offer without charge. It is a wonderful three-minute assessment, and it provides deep insights into your resiliency in the moment. It’s a snapshot in time. The resources you gain access to are entirely complimentary. These are things that you can do immediately to increase your mental, emotional, physical, and spiritual resilience.

All you need to do is go to RankMyResilience.com. Three minutes later, you’ve got yourself some new insights and answers. What we can tell you is that it never hurts. It’s only three minutes. Feel free to access it and take advantage of it. I want to say thank you wherever you are at this moment. We appreciate you. Have a blessed and beautiful rest of your day.

 

Important Links

 

About Thomas Douglas

Change Proof Podcast | Thomas Douglas | Adapt Or DieAfter serving in the Navy and recognizing his leadership abilities, Tom purchased JMARK in 2001 and grew the company from 6 to over 110 employees, landing on Inc. magazine’s Fastest Growing Private Companies list nine consecutive times and earning Biz 417’s #1 Best Place to Work in 2023. Tom now shares the business insights and leadership principles behind JMARK’s remarkable growth journey in his book and online courses.