any senior person you're hiring has to sit in on marketing meetings sit in on budgeting meetings sit in on finance meetings sit in on sales meetings they have to sit in on customer service meetings they have to go through training sessions they have to read manuals for different business areas they have to go and ride shotgun on sales calls they have to go for lunch or dinner virtually or in person with anyone in the company that manages people so the first 30 days is all about them understanding the culture the history the DNA and really getting a good glimpse of the whole business years ago I was at an event that Vern harness was running in Atlanta we all know Vern he was the founder of EO and I came off this stage this was back in 2007 or 2008 walked off the stage and this guy walked up to me and he said holy you're Cameron and I went yeah he goes for the last two days everybody's been walking around this event saying I need a Cameron I'm like what are you talking about he said I didn't realize you were a person I thought you were a saying I thought it was like a beag I need a beag I need a flywheel I need a Cameron and then realized it was you and people were saying that they needed what Brian had Brian and I actually met in an EO Forum group so we were in a forum together for four years I had two EO qualifying companies my first EO qualifying company I was a partner in boy Auto Body which is from Winnipeg uh Terry Smith and Brock bulbu were Partners I had a 10% stake in the franchising business that we built up expanded and when we took the company public I exited and Terry and Brock continued to build out what you know everybody in Winnipeg surely knows now was Boy Auto Body a huge success but that was my first EO qualifying company and then I was president of a private currency business and Brian watched me building those two companies while we were in Forum I watched Brian building what was called the rubbish boys and when we were in Forum he was doing just scratching the million $1.2 million Mark so he was still a small business as well but that's where Brian and I met I played the second command role three different times in my career as you guys mentioned or know I I wrote the book called the second in command which was my sixth book I started an organization in many ways similar to EO started this 7 years ago called the COO Alliance where no entrepreneurs are allowed to join and it's a community that's exclusively for the second in command where they go to actually grow their connections their confidence and their skill set we hold an event every year at MIT same place that EMP holds their program I host an event for the co Alliance there we held our first one there last September this September we're taking a group of Coos back we have 60 Coos I also host a podcast we've had 3 about 50 episodes now on the second and command podcast where we get the rest of the story and one of the things that I learned over the years was if you ask the entrepreneur the story or if you ask the second and command the story they have a very different perspective of how we built the business similar to if you ask Terry and I how we built the franchising group for Boyd auto body or if you ask Brian and I how we built- 1800 God junk or Kendra Scott who I think Jared knows if you ask Kendra and then her second command how they build her business there's very true stories but there's very different perspectives and that's what we identified in there we've been getting a lot of press around the COO groups um even as early as 2008 when we were only in our second year for the co Alliance we were written up in the actual physical print edition of Fortune Magazine and online as the rise of the COO support group and what they identified in this was that people like Cheryl Sandberg who is the second in command for Facebook didn't really have a community to go and learn from and I think it's something that you all need to remember about all of your employees is it's great to grow ourselves right it's great to grow oursel as the CEO or the Visionary but we really need a place to grow our second in command we also need a place to grow the rest of our team and that was something that we were really big on at800 got Junk was we made sure that each of the executive team had mentors we made sure that there were communities that each of the people on our team were spending time in and learning from and then I obsessed around the area of growing people and we're going to talk about that in the second part but that's why this whole rise of the co support group started getting noticed by Fortune Magazine I've always thought and Brian and even when we were building 1800 got Junk together saw ourselves as a real yin and yang partner where everything that Brian sucked at I was great at and everything that I sucked at he was great at and it really was a true partnership because neither one of us were capable of scaling the business off and Brian has talked about that for years that without me in those early days the first six years we never would have been able to go from the 2 million to 106 million that I was able to take them and Brian couldn't have done it on his own but I could have never built the Business Without Brian I could have never taken them from 2 million to 106 without being able to lean on Brian that entire time too so the definition of a COO it's funny there's we're going to get into some different ways to describe them and different ways to think about them but I've heard a couple of our Co alliance members one of them is an EO member from Toronto she said that her coo is the leash to her dragon and another one of our members said that he's the breakes to their coo CEO's gas and those are really great metaphors to consider is that our job is to kind of hold back the entrepreneur in many ways but not to harm them not to take away their unique abilities it's to try to save the entrepreneur from themselves most entrepreneurs are add and are bipolar I if I read you the traits of those you'd all identify as to why I would say that is being being accurate but we need the entrepreneur to be add it's actually not a disorder and I can speak to that if anyone wants to ask questions of why bipolar and why add are actually not disorders why those are the superpowers of entrepreneurs but we do need someone to kind of leash us back to work on the right things and to work on them in the right order so there's a I think the yin and yang component to it Harvard actually wrote an article now 18 years ago which is crazy but it's still quoted on almost a daily and weekly basis by people and companies and it was called the Misunderstood role of the COO and it was a really great article that identified the seven distinct types of cheap operating officers I'm going to talk to you about the different roles that each of the Coos play and how those roles can also morph over time because your company will scale and grow and your company will change as you scale and grow right the company that you're running today is not the company that it was 5 years ago or 10 years ago nor will it be the same company 5 years from now and the style of coo that you might need at a different stage changes so the first style that was identified is called the executor and this is the person that you hire to just get done it's the when things are just scattered things are all over the place or there's just so much that needs to happen that you need some one to come in to just get stuff happening I've often heard of of entrepreneurs and and Jared you even mentioned to me recently in an email that it's our add squirrel brain that somehow sometimes gets in our way because it shows us all the things that could happen but then we need someone to help us make those things happen so that's one role that is played by the COO another role that's often played and this is usually in a a mature company or in a company that's going through even though I hate the term a pivot but it's the change agent and it's usually when you're bringing someone in from the outside to help the organiz G ation go in a different direction or change the way that they're running the business the third is the mentor this was probably one of the core two roles that I played with Brian at 1800 God junk was I'd already built two EO qualifying companies I'd also opened the west coast of the United States for College Pro painters prior to even doing the boy Auto Body thing that's how Terry and I knew each other he'd watched me doing College Pro painters I was a family friend and had watched me really excel in opening up the west coast of the United States for college Pro so I'd already built a couple of franchise organizations I'd already had some pretty good success in business and I could come in and show Brian what needed to be done for the first probably four or five years I actually showed the list of all the stuff that we needed to do to scale the company and Brian had never done it before so I came in as a bit of the mentor the other half was certainly kind of part of where I would have played as well where Brian was able to take one part of the business that he was really great at and loved and then I was able to take another which which really was franchising where Brian had no expertise around that he understood the junk removal space love technology love the finance side of the house I wasn't strong on the tech side wasn't strong on the finance side but was really strong on operations execution all the areas of people from the recruiting interviewing hiring onboarding and leadership development of people and then all the systems around franchising marketing and PR were all super strengths of mine so I kind of came in as that other half of that yin and yang the partner can often be a COO and we have a number of members of our coo Alliance that are Equity holders in their business where it's usually sometimes the CEO and coo starting it together or the second in command might even be more of a tech side coo right you might have an entrepreneurial Visionary and then a tech leaning second in command who's often the partner in the business another role that we've seen happen over the years with the COO is the era parent this is the usually the key person inside of the company that you know is going to take over the business at some point sometimes it's in a family business and by the way if anyone in EO is a family run company take a look at an organization called Cafe which is the Canadian Association of family Enterprise it's like EO for family run businesses and I'd recommend that if you're in Neo and you run a family company you should also join Cafe to really get some great kind of Ip around that AA parent role and working inside of the family business because there's lots of these strange dynamics that don't happen in a normal company and then you also have the MVP role this is a person who is just so obviously the most valuable player on the team and if you don't give them that coo role they're probably going to go somewhere else so you need to handcuff them to the company otherwise you you risk losing them and that tends to be a migration path for this coo and you can come in from different areas to move into that mvp style of a COO there's a data point that Brad smart and Jeff smart talked about in their book's top grading and then in their book who which is the cost of the wrong person is 15 times their annual salary so the cost of having the wrong second in command in your company is 15 times what you're actually paying them so let's say you're paying your coo you know $200,000 a year which would be kind of more of a VP level it's really if if they're the wrong one the opportunity cost the negativity the problems the fact that you have to spend all of your time managing them or coaching them or growing them it's really costing you more like $3 million a year by not having the right person in place if you ever have doubt you have no doubt right if you're ever worried that the person is the wrong person you probably know that it's time to replace them and we can talk about that in a section that I call the parties over so why do we hire one well first on we only really run a company for one of three reasons we start a company to kind of put a flag in the ground or a stake in the ground to say that we accomplished something often entrepreneurs are the ones who struggled in school we might have been the solid B students or C students and we're still starving for praise still starving for recognition and we need someone to say hey great job and we start a company to be able to do that to kind of feed that need for ourselves so that's one and once you've got the company up and running you've accomplished that so you got that check mark done the second one is to give you money and it it allows you to have the financial freedom to do whatever you want and to be able to buy whatever you want another family friend of ours who was from Winnipeg his name was Paul alberon had known Paul very very well he ran a company called guard wine and Paul's hauling out of Winnipeg he was the 90-year-old guy who drove around Winnipeg in the Lamborghini and the Ferrari and Paul's motto was Whoever has the most toys when he dies win and that's another reason why we start a business but at some point you know you have enough toys you've got your sassin citation you got your Lamborghini you got your golf club membership at St Charles or Breezy Bend or wherever these guys are playing out over these days then you're kind of you got your check mark so you know you've got your money sign and then third it's around free time and this tends to be the one area that many entrepreneurs get sucked into is they forget about their Hobbies they forget about their passions and they become that workaholic who's only working and one of the core reasons why you can hire that second in command is to buy yourself the freedom to be able to do what you want when you want to be able to work on what parts of the business you want to and then also to be able to take a lot of time off and take a lot of time away from the business so some key reasons to hire one are to free up your time to leverage your unique ability so that you only have to work on the critical few areas that feed you with energy so that you can divide and conquer and and kind of work on the areas of the business that again feed you and get someone else to work on the areas that drain you and then really to accelerate growth right you're often going to get an incremental lift on the business by putting that right second and command in place tce by my metrics I think you should be getting a four times gross margin lift off the cost of hiring them so if you're going to spend $200,000 a year that person needs to be able to generate at least $800,000 in incremental gross margin in their first year of being with you that should be the metric that you put in place so that they work on the right projects to then allow you to scale so those are some reasons why you're going to hire one as a friend of mine Jack Daly who many of us in EO have heard of said if you don't have an an executive assistant you are one so one of the very first second and command roles that we hire should be our EA and if any of you are running a company today without having an executive assistant I really highly suggest that you actually look to get an EA in place because you're really going to leverage different parts of your brain and different parts of your business by getting those minimum wage jobs off your plate right at the end of the day let's say that your business makes you a million dollars a year your effective hourly rate is $500 an hour if I if I was on your board and I found out that you know you were making $500 an hour but you were doing $20 an hour work if you were doing any tasks that were $20 an hour $50 an hour even $100 an hour I would be pissed off as the board that were paying you $500 an hour to do minimum wage work so make sure that you bring an executive assistant in to get that stuff off your plate and then also look at your leadership team and do activity inventories with them and find out are any of the members of your leadership team working on the administrivia parts of their business so when I was the second in command at 800 got Junk back when I was coo in the second year trying to remember where we were in the floor plate we probably year three so we were probably approaching 15 million in Revenue at this point maybe 8 to 15 million in Revenue I had my first executive assistant at 1800 got Junk before Brian even had an EA I hired an EA to get a lot of the stuff off my plate I'd had an EA prior when I was building the private currency company so I understood the opportunity to get stuff off my plate and there's a huge opportunity to make sure that not only you have an EA today but your second in command can have one and these days the fact that you can hire fractional executive assistants we have a full-time EA who supports my assistant and this uh EA is actually based in in Manila my assistant's been with me for eight years she now runs all of operations she runs all of sales but she now hired an EA a year ago who's $1,800 a month so for two grand a month we have a full-time executive assistant in the Philippines working 40 hours a week for us you know it's irresponsible not to put one in place so I referenced the idea of the activity inventory it's important that you and all of your leadership team every 6 months do this exercise so the exercise that I like is I literally pretend that someone walks around with a video camera this is like a side camera that I have going on right now so I can get b-roll while I'm talking to you on the main camera but pretend that someone followed you around with a video camera all day long for an entire month and as they're following you around for an entire month you can actually watch yourself if you play back the movie and watch every single aspect of what you do in your day-to-day running the business and you play back and you might be able to to write down all of the tasks that you work on over the course of a month so what I like doing as an exercise is I open up a spreadsheet and in column A I write down every single thing that I do over the course of a month in my role I go to meetings I prep for meetings I do follow-ups for meetings I coach my team I read emails I book flights you know all that stuff right I might have 80 different things that I do and then in column b i c categorize each of those tasks or each of those projects or each of those activities I categorize them in one of four different ways either I for incompetent meaning I suck at it C for competent meaning I'm okay at it e for excellent meaning I'm really really good at it but I don't necessarily love doing it or you for Unique ability which is a stuff that I'm really good at and I love to do right it feeds me it fuels me up so in column three or the column C I write down the hourly rate if I was to pay someone just to do that job day in and day out what would I pay for that job right what do I pay someone to clean toilets or to do laundry or to prep food or to cut grass or to answer emails or book my travel or handle requests from clients what's the effective hourly rate for every task that's on my sheet and then what you want to do is delegate everything that you're incompetent at right get everything off your plate that you suck at get everything off your plate that you're only okay at which is what Brian did when he brought me in he didn't know how to run the franchising business so he was just making it up as he went so he was kind of incompetent at that and then the stuff he was really good at around it and managing an IT team to build out the software was something he really loved he loved to kind of get into that and for me that drained me of energy so you look at getting stuff off your plate and then also lastly getting stuff off your plate that's below your effective hourly rate some of that's going to go to an assistant some of those projects or tasks might go to a COO or a sect in command some of them might go to different business area heads one of my biggest pet peeves when I've worked with entrepreneurs and I've coached CEOs in group coaching and also in one-on-one coaching for almost 17 years now I still have a group coaching program that CEOs pay to be a part of one of the big problems I have for entrepreneurs is they say oh I I can't delegate that project to Dave because he doesn't have the skills get the project onto Dave's plate and grow Dave's skills or find someone to grow Dave skills but what we need to be doing more actively as the CEO or as the Visionary is to delegate everything except genius so that all we have left on our plates are the two or three core things that were really good at and that fuel us with energy and you start building out these unique ability teams of people that are working on their unique ability areas and that's really where you actually are going to scale up the company quite quickly so the activity inventory is the starting point at actually knowing who to bring into the company as your second in command because it shows you the stuff that you're going to be hiring for over the years we've had what I call Title inflation and title inflation is companies giving away titles that are too big for the actual roles and responsibilities and the level of pay for the person that we have doing that job 20 years ago to get a COO title you had to be a pretty major player inside of a pretty major company I was the first coo that I ever knew I didn't know of other people that ended up with that title and it happened I think because it was around 20002 2001 where the rise of the internet companies were starting and people were starting to get equity in Li of compensation and we were starting to give away these bigger titles to attract people and we also recognized that with the internet there was something around being able to leverage the title in email communication right remember email really only started around 1997 1998 is when we started using email with external companies so it was almost like giving out a digital business card and people started to give out titles to allow people to have a digital business card that was more meaningful for the people that we were talking talking to but the title coo could be a vice president of operations or it could be a general manager it could be a director of operations could be a project manager it could be an EA your second and command's title is based on four or five core things the first is the level of strategic Insight that they bring into your business so the ability for them to come in strategically and know what to do know what to do not to do kind of be able to point the organization in the direction of where they're able to go so it's not the CEO delegating everything so that's number one how much strategic Insight can they bring into the organization number two how much p&l responsibility can they have and do they have are they making financial decisions for the company are they able to manage the budget are they able to manage projections and cash flow and the p&l can they actually understand how to leverage the balance sheet or do they have that kind of visibility and financial occum to bring in number three how much autonomy can they have in their day-to-day role can they actually just show up and start working or do you need to manage them all the time you need to help them with their role day-to-day because the bigger the title is the more autonomy that they should be able to have in their day-to-day the fourth is what are the core projects and roles and responsibilities and metrics that this person is responsible for based on the roles and responsibilities based on the metrics that they're responsible for that starts to point in the direction of a different title and then lastly it's how many people are they able to bring in from the outside into your organization either other key hires strategic Partners you know how much talent Talent can they bring into the organization and that usually is a determinant around title so be careful that you don't give out titles too soon one of the other parts I've seen though as a company if you're ever trying to exit that's usually a time to put the proper titles in place to Market your business a little bit better if you're looking to sell your company in the next year or 18 months you want to make sure that you have a team of at least vice presidents so that you're packaging around your business looks and smells like something much more successful than just with a couple of general managers when you're having a SE in command they have to be someone you implicitly trust so you have to make sure that you really work on and continually build that trust this is where Brian and I had a very unfair Advantage right we were in Forum together for four years before I joined him as his second in command and he'd been the best man at my wedding 3 months before I joined him as his second in command so our trust was already implicit you also need to make sure that you bring someone in who has done it before right so when I joined Brian again as his second in command it was going to be the fourth company that I'd helped to build it wasn't going to be my first kind of rodeo or my first try I already had proven experience at having built a couple of franchise organizations and a couple of very fast growing teams the private currency company that we built we were hiring three people a day and we sold the company in January of 2000 for 64 million Canadian so I'd already you know that was 24 years ago so we'd already built successful businesses we'd done it before there was able to to be kind of proof that I actually knew how to run companies and that's something you need to hire for so you need to make sure that your interview processes are really tight if you are looking to hire not only a COO or any good senior person right now get the job description written but then poish it using chat gbt or polish it using a professional copywriter so that it reads and sounds more like a sales letter and much less like a government job description or job posting because your bios and job postings have to be something that push people away and pull people into your company like a magnet you're also never going to be able to find a great second and command by posting a job online and hope to get applications the best Coos are already working somewhere and you have to poach them to bring them into your company Terry Smith who built Boyd Auto Body knew my family from Sudbury used to come to Sudbury on Paul alberon's plane to play golf and I used to Cy for Derek Talon and Terry Smith and Blake Emery and all these golfers from Winnipeg I used to Coty for them in Sudbury so Terry had watched me building companies I was running College Pro painters and Terry poached me away from College Pro to help him build Boyd Auto Body when I was running the private currency company in Seattle Brian asked me if I would join him to help him scale out his business there was never a job posting or a job description for me it was the vision of that someone had for the business and their ability to entice me to come over to then help me go to that next level or take them to the next level that's really what you have to do is figure out how to poach people and bring them into your company and then once you have a second in command it's how do you leverage one I've talked a little bit about working on that unique ability is looking for the two or three are areas that feed you with energy that you're really really good at and delegating everything else onto the other people on your team specifically that second in command that's going to be the one big leverage point that you get the other part is in the first 90 days that you bring this person in is don't screw up the onboarding what we tend to do when we're hiring senior people is we're so glad that we have them that we let them start in their job right away what I do is in the first 30 days is I make them sit in on every single meeting so they have to sit in on finance meeting s this is a COO CTO whatever any senior person you're hiring has to sit in on marketing meetings sit in on budgeting meetings sit in on finance meetings sit in on sales meetings they have to sit in on customer service meetings they have to go through training sessions they have to read manuals for different business areas they have to go and ride shotgun on sales calls they have to go for lunch or dinner virtually or in person with anyone in the company that manages people so the first 30 days is all about them understanding the culture the history the DNA and really getting a good glimpse of the whole business I also like them to walk around with a notebook and a pen and to write down in their notebook all of the ideas that they have of what things they want to change inside of the company and the reason I like them having it on a p on a notebook and not doing it digitally is I don't want them to start any of the ideas that they come up with in the first month I only want them to write down all of the ideas that they have fire Bob promote Kelly integrate a CRM into the business whatever all these ideas are in the second month after they've sat in at all the meetings they've met all the people they've written down all their hypothesis of things they want to do in the second month they go back and look at all of their ideas and they start meeting with people to ask about their ideas and to learn more to decide which ideas are the ones to maybe start working on which ideas are the ones to kill and which ideas maybe are the right idea but not this quarter and in month three is when they can start working on some of the projects that require ire the least amount of people the least amount of effort and the least amount of money so that they actually get Buy in from the team and that people are excited about their ideas and they don't see their ideas as being a whole lot of work that require a lot of heavy lifting so that's how I kind of see the first 90day period starting and then our job as Leaders is to look for the Ripple effects that happen because anytime you bring a good senior person into the company there's going to be negative Ripple effects and positive Ripple effects of that senior leader coming in your job is to look for those when I left 1800 got Junk is coo 12 months later Brian found my replacement he brought in the former president of Starbucks USA and he didn't look for the Ripple effects he really kind of abdicated and let Lonnie just go off and run the business and within 12 months he fired her because she'd caused all of these negative ripples inside of the business in fact when I left the company the revenue was 106 million when she left two years later then it was down to 76 million so because of the global financial crisis and because of her mismanagement and the cultural Ripple effects the company had gone from 106 down to 76 it then took him another full year to go out and find the next replacement and now Eric has been with the company for the last 10 years and they're up to 450 million so you have to bring in the right person you have to bring them in the right time you have to look for the Ripple effects that they're going to cause you also want to make sure that you have space for you and the clo to get away from the rest of the team space where the two of you can actually brainstorming things strategically away from the rest of the leadership team it is truly that yin and yang partnership more than the CEO and any other senior role you really need to stay in sync with that senior person and I also think you need to have something like date night where you have time with this other person once or twice a week or at least once a week but a few times a month where you get away from the rest of the team and you just do stuff and hang out together Brian and I would go for runs on Tuesday and Thursday mornings we would work from his tennis club or my golf club on Fridays together we just sit and hang out and then we just did countless Bond activities together to stay connected as friends so that we could work through the tough issues together but we had systems in place to ensure that we had that real strong foundation for us and then I visualized my job as shining the spotlight on Brian and making him look good and he saw his job was to shine the spotlight on me to make me look good back in I think 2004 we came and spoke to the EO Winnipeg chapter and we were on the stage together and you'll often you you almost never see two people on a stage together Brian and I were talking about how we were scaling the company and I was always talking about what he was working on he was talking about what I was working on our job was to make each other look good internally and externally inside of the organization and then when's the party over right at some point the company does tend to outgrow that person's skill set unless the person can continue to grow their skills at the same Pace the company grows there's a couple of really interesting data points out there um I was speaking with clay mask who is the founder of infusion soft and he and I both believe that a senior person can only stay in their role after two doubles in the company so when a company goes from 5 million to 10 million they can still be in their role let's say that their head of operations when you get to 20 million they can probably still be in their role as the head of operations but when it gets to 40 million the company is now too big for them right because really from 5 to 40 million is an eight-fold increase but it's only three doubles uh Ben Horowitz who wrote the hard thing about hard things said an executive can only go through one triple when it's too hard to go to the next Triple so 5 million to 15 15 to 45 you end up roughly around that same point the company just gets to be substantially different than it was so in scaling wender got Junk from 2 million to 106 million we doubled the size of the company Six consecutive years in a row and it was in year six that we realized the head of Finance had been replaced the head of it had been replaced the head of franchise sales had been replaced the head of the call center had been replaced Brian and I were meeting one Thursday morning before our leadership team meeting I ordered my typical eggs benedict Ryan would usually order eggs benedict as well and he ordered grapefruit and he started to kind of tear up and he said I think it's over and I said I think it's over too I told your assistant last night that you were firing me this morning and what we realized was that even though we were still best friends even though we'd scaled the company and had ranked as the number two company in Canada to work for that year we had 3,000 employees systemwide which was up from the 14 employees the day I walked in as employee number 14 the company was just substantially different and I didn't have the skill set to be able to take it to the next level so even though I was the right coo to match Brian and to have the skills to get us to that stage I didn't have the skills to get us to the next stage interestingly Eric Church who is COO for onew got Junk today Eric and I met back in 1987 in Ottawa we were in uh University together we actually co-founded a fraternity in Ottawa together called AAA I was president the first year Eric was President the second year and now Eric is the COO for 1800 got junk and he's grown them to 450 million he would have been a horrible coo for the first 6 years because he didn't understand the entrepreneurial side of the business didn't understand franchising wouldn't have had the skills to be able to get it to the 100 million but he is absolutely the best to be able to take it from the 100 million to the 450 million because he does have that skill set for the right season that the company is in so that's something else you have to consider when you're bringing people into your organization is what season is your company in or what stage of growth is your company in and have they built companies in that stage of growth that you're in right now your business deserves to have a successful year the core thing that you need to do is really clearly articulate a vivid vision and communicate that Vision to your customers your employees and your suppliers so everyone is completely aligned that inspirational value that comes off of vivid Vision will be massive for you click this video below and learn how a vivid Vision will be really powerful to help you grow your company