How to Inspect Your Business

Nothing improves in life unless you inspect
it regularly. And I mean nothing. So take any area of your life. For me, I’ll give you an example. 90 days ago I did not like where I was at
with my body weight, and my energy. I weighed 257 pounds and I’ve never weight
257 pounds. Ever. I went to a doctor. We spent four hours together. We did testing. We got every single thing I can get on myself. My body fat percentage, my body mass index,
water, how much fat my body carries, what muscles do I need to have, triglycerides,
every single detail we could possibly do. He made the recommendations. The recommendations were made. I’m supposed to implement with the recommendations
that were made. So whatever those recommendations were, no
grains, you know, all this other stuff that I went through. Fast forward 90 days later. I went this morning. I ended up losing 24 pounds. I’m at 233 right now. I haven’t weighed 233 since 2006. My energy is just off the charts. Why? Because I inspected it. If I don’t inspect it, that’s not going to
happen. The same goes with your relationships. The same goes with your business. The same goes with your life. The same goes with your finances. Back in the day in 2003, my credit score was
terrible. Every single month, I mean every single month,
I started running my credit score. Every month, on the 19th of the month, I ran
my credit score. Every month I read all my reports and found
out what wasn’t supposed to be on there and what was. A year, two years, three years later my credit
score went from a 489 to 822. Why? Again, inspecting. So today I’m going to talk about how to inspect
your business. Again, this question is probably one of the
most common comments we get. Pat, how do you inspect your business? Now prior to me getting into this, I want
to tell you that I’ve got a surprise for you at the end, because this actually requires
you to have a PDF to print out and have access to, so stay tuned and watch the entire video
because you do want to have this PDF to do exactly with your own business, that I’ll
tell you how I do it myself. It’s a very, very extensive PDF that will
help you out with. So, inspecting your business – how often do
I do this? I do this, full day, once a year. And another time per year, every six months
or so, I’ll do it for a half a day. We’ll sit down and go through a few things
on what we need to improve in, and we’ll improve it. But once a year, when I inspect this, is a
full day. Maybe two days, that we’ll inspect the business. And it’s multiple businesses, and it’s multiple
parts of my life, when I’m doing my life planning and business planning. So let’s get right into it. How to inspect your business. First of all, there are 12 different categories
that I have here. And every one of them is tied to a number
and a goal. Every single one of them. So you see on the left side here is numbers
and goals, and then here is a different category to inspect within your business. I’ll explain every single one of them to you
and I’ll tell you how I do this. #1: Team The first one is team. What is a team? So when I look at my team, who do I need,
who am I missing, what department needs help, what department needs a leader, what department
needs support, what department doesn’t need people, what department do I need to fire
the weakest link that slows everybody else down. But I look at the team within different departments. When I look at my team, I score the team,
between 0 to 10, how good do you feel about your team. And by the way, you can score teams and getting
even more detail. You team could be your assistant, your team
could be could be your executives, your sales force, it can be many different things. But I score my team. Then once I score my team, I write the good,
bad, ugly. So let’s just say the score is five. I write the good is that these two people
have grown a lot from last year to this year. And I’ll put two names down. The bad is, we still don’t have somebody that
knows how to do. . . The ugly is this one department is a disaster
this year. We’ve got to do something about this department. Great. Then in this category, I write my three actionable
items. So what am I going to be doing? I’m going to do this, I’m going to do that,
I’m going to do this. Now, this is tied to numbers and goals. So my goal is to hire three people, two in
this department, one in this department, fire this person. Number, goal. Number two, my number that I’m going to do,
my expectation of this team is for them to do $600,000 in the next two weeks, whatever
the number may be for your business. Great. There’s a goal. So every box will have a number and a goal
tied to it when it comes down to actionable items. #2: Sales Flow The second one is sales flow. How’s my sales flow looking? So I’ll go through and look at the sales cycle,
right? Where does the customer come in? Once the customer comes in, what options do
they have? Is it pretty easy for them to know what next
steps to take? Do they find this pretty well? Do we do a good job of selling and do we do
a good job of presenting? Do we do a good job of going through the sales
flow part. Do the people know the products that they’re
selling to them? It is pretty easy? Do we sell it in a simple way? Can it be found easy? So I’m going to look through my sales flow,
and the sales flow could be, you know, we had a video that I did that’s called the sales
process video — why don’t we put a picture? What’s the title of that video? How to improve your sales process? Something like that. Why don’t we put the link here so they know
what it looks like? You can go find it. I look at that sales flow, the sales process,
on how I can improve it. Again, same exact thing. Score it 0-10, write down your good, bad,
ugly, and then your three actionable items. #3: Systems and Procedures The next one is systems and procedures. What is the system that we have in the company
for hiring? Meaning, when you sit down and you hire somebody,
what questions do you ask when hiring? How was the firing protocol? How do we fire somebody? Who fires somebody? How is the exit interview? What do we do with the exit interview? What opportunities do we give to them? How do we let them go? What is the system when we have a complaint
come in? What is the system that we have when we have
a question come in? What is the system that we have when we have
a good story come in? What is the system and procedure that we have
when we recruit somebody that we’re putting them in a department that’s processing or
compliance or operations or . . . what is the system for them to learn? So if I bring a new hire, how is the new hire
going to learn about our company? How is the new hire going to be injected into
the culture? What process do they go through for orientation? Those are my systems and processes. Then the process comes down to areas on the
back end that I’m looking at with the processes and technology and the CRM, and is our CRM
doing a good job? Can we get a better CRM? How is the software that we’re using? Do we need to enhance the software? What areas of the software are we not using
at all? So make a list of the 20 different areas in
the software that we use and which ones do we not use, rank them. Why do we have these things? Why don’t we eliminate them? What can we enhance? These are all questions I’m asking about systems
and processes. Again, by the way, you’re doing the exact
same thing here – scores 1-10, good, bad, ugly, then your 1, 2, 3 actionable items,
tied to numbers and goals. #4: Partners Then it’s partners. I write down partners. How are our partners doing? Now keep in mind, I have partners here, and
I have vendors over here. Partners and vendors are different. A partner is somebody that I have worked with
generally for three years or more. Once somebody I’ve worked with for three years
or more who is invested in wanting to improve the relationship, they’re investing money
and they’re vested in wanting to improve the relationship, that becomes a partner to me. Then I’ll ask, how’s the partner doing with
us? Are they servicing properly? Is it getting better? What can we do to make this partnership better? So in the partnership category, I will make
a list of all of our partners. So let’s just say it’s five of them. How is this one doing? So the scoring on each one is going to be
different, because it’s five partners. How’s the good, bad, ugly of each partnership? What three actionable items do I have about
each partnership that I need to talk to them when I have a conversation with them? So I put that together and then I’ll say with
this partnership, have the numbers gone up? Has it gone down? Why has it gone down? Is it our fault? Is it their fault? What is it that their processes hasn’t improved? What are some things they’re maybe not happy
with us and we can improve and have we improved on it, and have we delivered on our promises? I’m looking at that, with our partners, and
areas that my expectation of the partners. What do I need to go and negotiate with the
partners? What conversations do I need to have with
the partners? I’m having those types of conversations and
writing them down, on which partners I need to speak to again. That’s the other area I inspect. #5: Customer Service How is our customer service? Is our customer service good or are we way
too aggressive? Are we listening to the customers? Do we become too offensive too early? Is our way of selling a way that makes customers
happy? What is the experience we’re giving to our
customers? What are the words that we’re using? Is it more of a script or is it more of an
experience? What is the difference between a customer
service and a customer experience? Are we doing a good job teaching customer
experience and customer service? Are we doing a good job taking care of our
clients in a way that we’re getting more referrals? So, I break that down, and I find out about
the five least happy clients that we had this year. Why were they not happy? What did they do? Out of the five, let’s just say that one of
them was just a rant. They were just unhappy, nothing made them
happy, and you can see the trend. Everybody is unhappy, everybody is unhappy
with that one client. Great. But the other two had valid points. And these other two had questions that we
never answered. Why don’t we call these two? Let’s find out a little bit more. Let’s let them teach us about our customer
service. Tell us what you’re not happy about. What happened? We want to learn. We want to improve. Would you mind sharing that with us? Yes, great. And then giving them something just to share
their feedback with you. Let’s improve in this area. We’ve got to get better in this customer service
area. We rank them and we try to improve that. This is probably one of the most important
ones and one of the most difficult ones because it’s an area you don’t have control in, but
it’s an area that when you’re running and gunning, you forget to do this sometimes. You need to do it. The sooner you can do it, the better it is. Again, same exact exercise, 1-10, good, bad,
ugly, three actionable items. #6: Brand How’s the brand doing? What does the brand mean? What does the market see our brand as? Is it improving? Is it getting into every single household? What is the meaning of our brand? What’s the story behind our brand? Tell me about the brand? We sit down and say, “What do you think about
when you think about the company?” If I were to ask you, “What do you think about
Valuetainment?” what are things that would come to your mind? What would you say about the brand Valuetainment? What would you say? You, would teach us. I would sit there in a meeting and say, “Guys,
what do you think about the company? What does the company mean to you? Can you tell me what our mission statement
means to you?” And I want to see the heart. I don’t want to see the logical side. I want to hear them. Because based on their answer I’ll realize,
man, we’re too logical. Why are we so logical? Why do we get away from the initial mission
statement of the company? Have we forgotten what it was all about? Well maybe if we’ve forgotten what it was
all about, then it was my fault. I’ve got to take responsibility for it because
I’m the leader. What are we doing over here? We’ve got to get better with the brand. So then the same thing with the brand – what
it means, breaking it down, going into it, looking at every aspect of the brand, looking
at everything with the website, social media, all parts of it, then, same thing – score
1-10, good, bad, ugly, three actionable items to improve in. #7: Skills Let me explain skills. So skills for me is not just one dimensional. Let me explain to you what I mean by skills. So skills to me is first of all, most important
is me, how am I going to improve my skill set? How am I going to become a better CEO? So for instance, I just went to Harvard Business
School, their OPM program, Owner President and Management program. I was with them for three weeks and I’m going
there next year and the following – it’s a three-year program. And I’m around everybody in the room, net
worth, give or takes, 20 billion dollars combined, with 144 of us, only 14 from America, 60 different
countries. So why go over there? What skills do I need to improve in? What areas do I need to improve in? Do I need to get better at operations and
find somebody that’s strong in operations? Do I need to learn the ratios better? Do I need to understand the finances better? Do I need to understand development better? Do I need to understand expansion better? What are some areas I need to improve in? A lot of times the most challenging thing
with skills with you, the leader is, you think you’re good enough already. That’s the biggest challenge I would say. You think you’re already there. You think you’ve already arrived. You think you’re already good enough to take
the company to the next level and you’re not. The Patrick that got his business to $100,000
a year revenue couldn’t get the company to a half a million dollars. He had to change and improve. Then a half a million to a million he needs
to change, and a million to two million, and two million to five million and five million
to ten million, ten million to 20 million, and 20 million to 50 million and 50 million
to 100 million – there is a part of recreating yourself, right? So skill set starts with myself, what I need
to improve in. Then, my main executives and leaders – what
do they individually need to improve in? So I’ll take the skill sets of them, and really
assess it, and sometimes you don’t like doing this, because it’s time consuming, but one,
they will appreciate it so much that you put time into it, two, the company’s going to
grow. So if you think you’re going to wing it, sometimes
people are blinded by their skills. It requires coaching and a leader to say you
have a little bit of a thing here, you’ve got to work on it. This is not helping you in the business. And the last time you had to work on this,
and you did, your income went up. Your business grew. You hit your goal. So let’s make sure we improve in this area. So again, skill starts with me, then my main
core executives, then my customer service operations, what skills can we improve in? Then, what area do we need to improve in on
the sales side? What area, and in every single thing it goes
skills. How to, how to, how to. Then from that area, I either read the books
that we need to give and assign to those people, an article, a video, a movie, a speaker, a
consultant, a keynote, it doesn’t matter. We need to improve in audacity. We go bring somebody that’s about audacity. For instance, we brought Grant Cardone. We need to improve in seeing the vision about
capitalism. Boom! We bring somebody that talks about capitalism. We need to improve entrepreneurship and seeing
that anybody can go from nothing to somebody. Magic Johnson’s a keynote speaker. We need to go and improve the area of management
and overcoming conflicts and all this other stuff. Crucial conversations. We need to figure out how to get better in
dealing with issues and systems. Let’s go bring. . . it doesn’t matter what it is. We’re constantly looking at skills that need
to improve, then figuring out tools to add to improve this skill set. So score, good, bad, ugly, 1, 2, 3 actionable
items. #8: Expansion Expansion is what market do you want to get
into that you’re not into right now? When we first started our insurance agency,
we were all in Northridge, California, one office, 66 agents. And we wanted to expand and grow from one
state to two states, so we went to Florida. Expansion. I sent one of our executives over to Florida. And then from there, when Chad went to Florida,
working with John, then we said, how are we going to go into different markets? Then we put our plan of action together, our
strategy together, on which markets we wanted to get into. So then we put our plan of action together
and then all of a sudden, we went from two states to five to ten, to 20, to 30, to 40
– I think we’re in 44 or 45 states right now. By the end of the year, we’ll be in all states. But that’s because we have to talk about expansion. And I see a lot of times the entrepreneur
sometimes one, thinks about expansion too early and loses the penetration that he has
locally, or they never think about it, and they just hope it happens accidentally. Both ways there’s a flaw, meaning, if you
have three people or five people or a small sales force, you don’t want to all of a sudden
spread everybody thin and say you go over here, you go over there. You’re all of a sudden thin. It’s like military. You don’t want to go to war and tell your
generals you’ve got 200 soldiers, and you tell 10 go here, 10 go there, 10 go here,
10 go there, and it’s like 10 different soldiers went 10 different places, and all of a sudden,
70 got killed because they’re too weak, because they faced 600 soldiers in one area. You don’t want to flank it like that. So you go and expand and take your army from
100 to let’s just say 350, then you move 50. So you need to also know about expansion timing,
is it the right time for me to expand? Is this person ready to go to a new market? Are we ready to take this product into a new
market. Do we want to go into this state? What are the top metropolitan cities? Is our product tailored to a metropolitan
city or is our product tailored to a second tier city that we want to get into that’s
not maybe a top 20 metropolitan city. What is it? So you’ve got to sit there and really think
about expansion. You’ve got to think about that. Then again, same exact thing, 1-10, good,
bad, ugly, 3 actionable items. #9: Culture Culture every single year. So culture is something that it goes back
to the brand. Brand and culture are very similar, but culture
sometimes the further you get away from it, and you no longer go circulate among the troops,
culture disappears. It is very important for you to circulate
among your troops for the culture to stay intact. So I’m going to sit there and say, what was
the culture in the first year? What was the culture in the second year? What is the culture in the third year? And we continue. The basic thing I’ll tell you is what is the
difference between a cult and a culture. Here’s the difference. A cult is all predicated on a cult leader. A culture is no longer predicated on a cult
leader. So maybe you went from being a cult, because
everything was dependent on you and you’re no longer a cult, now you are a culture. Because a cult leader can be disappearing
and the question is, if the cult leader dies, will the culture continue? And hopefully there’s been duplication taking
place with other people taking the culture to the next level where this is no longer
needed and it becomes a figure head or a voice, but the more you’re touching the culture,
the thicker it gets and the more social capital it creates, and then there’s a part you’re
talking are we evolving, are we adapting, are we still the same? Sometimes bigger companies, their problem
is their culture is a 50 culture, and you were still using DOS. We’re old school with this. Well maybe old school doesn’t work because
the person you’re trying to attract is not turned on by old school. So are you paying attention to that? So who do you want as a customer? Are they going to be interested in your culture
that hasn’t adapted yet? So the culture requires a lot of due diligence. I did a video once, I think it’s called 24
ways to build a company culture. Let’s put a picture again, an image up here
again so you can see it on how to improve your culture. And by the way, I get into very, very vivid
details on how I worked on the culture in myself. #10: Compliance Boring. No one likes compliance. This keeps you in business. Every business has compliance. you’ve got to get the best compliance people
working with you. The best of them. Even when I was smaller and I was running
a sales shop out of the Granada Hills office and it was not the best area where we got
our office. A couple of times there was a drive by. We had a legalized marijuana joint and they
were not only selling marijuana, they were selling cocaine and other things out of this
place. So anybody that would come into our office
would just smell the marijuana – maybe that’s why people bought easily from us. Maybe that kind of helped out a little bit. But compliance was something I invested in,
because it kept me in business. Sometimes if you’re the marketer and you’re
a sales guy and you’re going a million miles an hour and everything is sales, let’s just
make it. . . and you’re not hitting compliance, you’re all of a sudden creating an avalanche
of compliance problems that you need to put up with two years from now that you could
have solved the sooner you touched up on compliance. So don’t skip this too quickly. This is very, very critical to know exactly
what compliance issues you have. Same exact exercise you need to do with compliance. And sometimes compliance will have to do with
hiring new team members. Keep that part in mind. #11: Vendors Vendors are people I’m doing business with,
that I’m transacting with. I’m paying them, they’re a vendor, and I’m
seeing which of these vendors can possibly become partners. And which of the vendors do I want to fire? There’s a vendor this year I’m firing. I’m not happy with this vendor. That person’s going to get a personal phone
call and “you’re fired.” Because I’m not happy with the way, sometimes
vendors, and I hope my vendors are watching this, by the way. You know who you are, because some of my partners
and vendors, some of you watch all of these videos and you message me afterwards. If you’re watching this vendors, I hope you’re
seeing this. I love vendors who have aspirations of becoming
partners. I have a very big problem with vendors who
have already done business with you two or three times and they’ve gotten 100, 200, 300
thousand dollars out of you, let’s just say a million dollars out of you because you’ve
done business with them. So now they think it’s on automatic that you’re
going to say yes every single time and they can now upsell you by 10% or 15% or in just
hidden commission stuff, because you’re already doing business with them. I have a very big problem with that. And every time this has happened [snap], someone
gets fired. Every single time [snap] someone gets fired. So vendors I’m looking at which of them I
need to have a very private conversation with them and tell them exactly what my expectation
of them is moving forward. And I will have those conversations with vendors. I will have those conversations with vendors. And then sometimes the vendors are doing such
a great job, I’m really hoping that we can get over here [partners] and I tell them what
it’s going to take to go from here [vendors] to here [partners]. If we do this, then you become a partner. And when you become a partner, we endorse
you, and once we endorse you, everybody goes through you. And sometimes partners get demoted to vendors
as well. #12: Competition Last but not least is competition. So competition may be what new competitors
are getting into the marketplace, what is the barrier to enter today, how are regulations
looking for us to go against the bigger guys? What bigger competitors are buying a presidential
campaign or nominee and funding them because they’re hoping to add a new regulation or
law that’s going to prevent us from competing with the bigger guys. I mean, we study all of this stuff. You know, you don’t build a billion dollar
company accidentally. You need to know that these guys that are
up there, the bigger competitors don’t want you to grow. They’re wish is for you to go out of business. Listen, they’re dreaming you’ll go out of
business today. You know who you are, you’re my competitor,
and you’re watching this. Many of you watch, as my competitors. You are praying we go out of business today,
right? But we study you as well. We know how powerful you are, and sometimes
you’ve got to see who’s coming up from here, who’s getting down, who’s getting out of the
game, who decided to get out of the certain product that you’re in, they don’t want to
touch it anymore, and why? What price are they being sold? What is the price point right now, kind of
like the comparables. What is the company’s value because somebody’s
company was sold for $17 billion so it automatically raises your valuation. All of those things you pay attention to with
competitors. Which one of them are calling you? Who wants to go from a competitor to a partner? Some of these competitors see you and say,
I don’t want to compete with you, man. Can we become partners? How can we become partners? Then you know there’s possibly a relationship
there, so there’s proper due diligence and investigation. It’s pretty detailed here with the competition
side as well. And then boom. Same thing – numbers and goals. That you do. By the way, this, once a year takes a full
day. Once a year it takes a full day. And it’s well worth it. It will make you millions if you do it properly. Another time you do, six months, it’s an overview,
because you’re debriefing what you did for the full day and you’re just recapping and
going through the points and you’re marking off we need to adjust, are we doing this,
not doing this, highlight which actionable items we already hit, which one’s close. Sending emails saying guys, remember earlier
we talked about this, we’re this far off. Update, update, update, and then boom. So once a year full day, second time inspect
and email where everybody’s at so everyone knows what the goals are with this. So again, this is a full day course. I can do this full day course, but this is
not the place to do a full day course. This is simply a YouTube channel video that
I’m doing for you. But here’s what I want you to know about. What I did for you is a couple of different
things. One, this is not a video you want to watch
once. You want to watch this video twice. You want to watch this video and share this
video with people that are part of your team, especially your executive team that can also
figure out ways how they can improve their parts of the business. The other area I would tell you to do is this. I have a PDF that I had my team produce that
has this formatting, on a sheet of paper, for you to score yourself, then questions
underneath it with the good, bad, and ugly and the one, two, three that you can go print
and download, for free, there’s no cost to it. Some people would pay hundreds of dollars,
there’s a lot of online people that would pay hundreds of dollars for this – purely
free – you need to go to or the link is going to be somewhere here
if you’re watching this on YouTube, the link will probably be on the bottom. If you’re watching this on a completely different
website, come to my website and on there find this video, just type in
“inspect” in the search and the video will come up, you’ll have a
downloadable item, a PDF on the bottom, you’ll see it. Print it out, go through it yourself with
your business as you inspect it, and then send me a message once you do this, and if
you have any questions or comments or thoughts about it, comment on the bottom and last but
not least, be sure to subscribe to this channel. We are this close, listen, this close to 100,000
subs and we would not get here without your help and many of you I’ve personally want
to thank who are getting their entire teams to subscribe to this. We’re so excited about all these projects
we have coming up over the next three, six months, a bunch of collaborations that you’ll
be excited about. But please subscribe to the channel if you
haven’t already. [throws the pillow] Mario, good catch. And everybody else, this is how I inspect
my business. Take care everybody, bye bye.

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