Mike Paton: An interview by Bob Morris

PatonMike Paton has spent a lifetime learning from and sharing with entrepreneurs. The product of an entrepreneurial household, he cut his teeth in banking before running (or helping run) four small, growing companies. For the last seven years, he’s been helping entrepreneurs clarify, simplify and achieve their vision by mastering the Entrepreneurial Operating System (EOS).

Mike discovered EOS while trying to run a $7 million company in Minneapolis. Drawn to its simplicity and usefulness, he quickly became a passionate advocate of the system and leader of a vibrant and growing community of professional EOS Implementers, clients and fans. An award-winning speaker and best-selling author (Get A Grip: An Entrepreneurial Fable, with EOS creator Gino Wickman), he has conducted more than 1,000 full-day EOS sessions with leadership teams of more than 100 companies. He’s also helped thousands more business leaders at dynamic, value packed keynote talks and in-depth interactive workshops. Whatever the venue and format, Paton attracts large audiences, receives consistently high ratings and introduces a complete set of simple concepts and practical tools that help leaders “get a grip” on their business.

Mike lives in Minneapolis with his wife Kate and sons Henry and Charlie. An older son, Jon, lives and works in Clifton, IA.

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Morris: Before discussing Get a Grip, a few general questions. First, who has had the greatest influence on your personal growth? How so?

Paton: My grandfather, Art Pfeil, who taught me how to learn, how to teach, how to work hard, and how to love doing all three.

Morris: The greatest impact on your professional development? How so?

Paton: Gino Wickman and his business partner, Don Tinney — without whom I’d have never discovered EOS and become a passionate teacher of the system. They’ve helped me simplify, clarify and achieve my vision as an EOS Implementer, a business owner, and a man.

Morris: Years ago, was there a turning point (if not an epiphany) that set you on the career course you continue to follow? Please explain.

Paton: I was fortunate to grow up in a household where teaching and learning was cherished. My sense of curiosity and wonder were encouraged, and it’s something I bring into every class, every book, every job, hobby and personal relationship I’ve ever encountered. The only epiphany is that very few things in life – professional or personal – don’t fulfill that desire for discovery and wonder – if you just open yourself up to it. From a career perspective, that desire to learn and grow – and to have that impact on others who want to do the same – has always driven me.

Morris: What do you know now about the business world that you wish you knew when you when to work full-time for the first time? Why?

Paton: What I know now is that we are all in complete control of our own choices, and accountable for the outcomes those choices create. I spent way too much time early in my career focused on people and things that didn’t have anywhere near as much impact as I imagined on my work and my life. I’d refocus all that time and energy on my own actions and outcomes.

Morris: Of all the films that you have seen, which – in your opinion – best dramatizes important business principles? Please explain.

Paton: This may get a laugh – or bring an abrupt end to this interview – but Tommy Boy has always been a favorite. As silly as that movie is, it fairly accurately identifies some issues (and solutions) common to entrepreneurial companies. First, you have a gifted, gregarious, driven founding entrepreneur who doesn’t adequately develop the next generation of leadership in his company, thereby exposing the organization to risk. Upon his death, a power struggle develops between his pedantic number two, his oaf of a son, his trophy wife, a risk-averse board/capital partners, and an unscrupulous competitor. And the company is saved when the son partners with the people in the business, reconnects with the “soul” of the business, and begins making great things happen. That story is played out each year in literally hundreds of entrepreneurial companies – admittedly with less hilarity and more frequent failures than successes. And, as an added bonus, it’s really funny.

Morris: In one of Tom Davenport’s recent books, Judgment Calls, he and co-author Brooke Manville offer “an antidote for the Great Man theory of decision making and organizational performance”: organizational judgment. That is, “the collective capacity to make good calls and wise moves when the need for them exceeds the scope of any single leader’s direct control.” What do you think?

Paton: I agree completely. At some point in every young company’s growth curve, it hits a ceiling. Often that ceiling is caused by the limited capacity of the person (or people) who make most of the decisions, handle all the most important projects, and do the most valuable work. When a “great man” or “great woman” becomes overwhelmed, the company often either flat-lines or fails. Truly great leaders see the need to hire and develop extensions of themselves, so that collectively the team begins achieving more than the sum total of its parts.

Morris: In your opinion, why do so many C-level executives seem to have such a difficult time delegating work to others?

Paton: Many leaders and managers – at every level of an organization – struggle with delegation. There are literally dozens of “root causes” to this issue – some owned by the leader and some caused by their organization. In the language of EOS, we find most of those root causes can be traced back to weakness in one of six “Key Components” of a well-run business – Vision, People, Data, Issues, Process and Traction. And delegation issues can truly be traced back to weakness in all of them.

For example, sometimes a leader fails to delegate because he or she doesn’t have the right people on his or her team, or isn’t cut out to lead and manage. That’s weakness in the People component. Sometimes, the company’s core processes aren’t documented, simplified, and clearly followed by all – the Process component needs work. Sometimes a strong data component (with metrics that alert the leader to an issue and help keep people on track) will help solve a delegation issue.

Morris: Now please shift your attention to Get a Grip. When and why did you and Gino Wickman decide to write it, and do so in collaboration?

Paton: What’s funny is that Gino and I each had an idea for this book on our individual “3-Year Picture” when I first began my EOS journey in 2007. About 18 months into that journey, one of us casually mentioned it at a quarterly collaborative exchange. As we began talking about the reasons to write this book, and the strong feelings we each had about making it a business fable – we really were starting on the same page.

In a nutshell, we decided to write the book and make it a business fable to help entrepreneurs better understand and implement EOS in their businesses. We’d discovered that many Visionary leaders learn best by observing others with whom they share a common bond. So we worked hard to create a “real-world” company, led by real people that would ring true for most entrepreneurs and their leadership teams. We then told a story that includes dozens of common situations that each of us had seen multiple times in the real companies with which we work every day.

By walking through the Swan Services EOS journey with our readers, we hoped to help readers more usefully follow the process and the EOS tools a professional EOS Implementer employs to help his or her clients master EOS.

Morris: Were there any head-snapping revelations while writing it? Please explain.

Paton: Just how hard it is to finish a creative work – to push it all the way across the finish line.

Morris: To what extent (if any) does the book in final form differ significantly from what you originally envisioned?

Paton: It’s surprisingly consistent with the earliest summaries and character sketches Gino and I shared with one another. What made the process challenging was the need to strip away all but the essential parts of the story. There’s a temptation to share everything one has learned while working in the trenches with entrepreneurs, but 950 page business books generally don’t appeal to our target market!

Morris: What do the two books, Grip and Traction, share in common in terms of their core insights?

Paton: At the core of both books is a belief that most entrepreneurial companies – and their leadership teams – are both wonderfully different and shockingly similar. That there are a set of common issues and challenges, strengths and weaknesses, and range of human tendencies and emotions that materially impact what the company can accomplish, and the quality of life its owners and leaders enjoy.

What’s also very core in both books is the belief no organization can succeed running on multiple “operating systems,” it must choose one. It must have a team of leaders working together to achieve a clear vision, instilling focus and discipline throughout the organization, and working together as a healthy, collaborative leadership team.

Finally, both books help entrepreneurs understand the value of strengthening the Six Key Components using a set of timeless principles and practical tools.

Morris: To what extent are they [begin italics] significantly [end italics] different?

Paton: For me it’s really the format of the two books. Traction is essentially a how-to manual. It’s engaging, insightful, and full of real-world stories and examples – but at it’s core Traction is designed to illustrate the concepts and tools central to EOS, and to explain to readers how to build and use those tools. Get A Grip is a story that illustrates the common problems entrepreneurial leaders face, and their trials and travails as they try to resolve those issues using the tools.

What are the core principles of the Entrepreneurial Operating System (EOS)?

Paton: In addition to the principles mentioned in the “Core Insights” question earlier, I can go into a little more detail about the Six Key Components – Vision, People, Data, Issues, Process and Traction. Our belief is that truly great businesses are “strong” in all six of these key components.

When a company implements EOS, they begin working to strengthen each of these components using simple concepts and practical tools. The team strives for 100% strong in each of these components – knowing that’s impossible, it’s utopia. But it works to get to 80% strong or better, and then constantly uses the system and the tools to keep itself there.

Morris: Which of these principles seems to be the most difficult to master? Why?

Paton: Gino and I say often, “Clients are like snowflakes,” and this question is a great illustration of that point. Each of the six has come easily to a handful of my clients, and each has been difficult for others. What’s quite common, though, is that the people component gets the most attention, because it drives the most emotion. We all have clients who are 97% strong in the people component – literally 65 of their 67 employees are right people in the right seats – that are tremendously frustrated about those two people issues.

Morris: My own opinion is that the same principles can also be of substantial benefit to executives in Fortune 100 companies. What do you think?

Paton: In theory, you may be right. Certainly “Entrepreneurship” is a word buzzing about the halls of many large organizations today. If the leadership team of a Fortune 100 company wants to clarify and simplify its Vision, instill discipline and accountability at every level of the organization, and eliminate politics and confusion to become a truly healthy, cohesive, functional leadership team with a truly vibrant culture – implementing EOS can be a great way to do that.

However that work is hard, requires fundamental change at every level of the organization (beginning at the top), commitment from every member of the leadership team, and won’t happen overnight. And the people who run the organization need to feel truly empowered to make the tough decisions, to run the business day-by-day, and to accept accountability for everything that occurs.

Often in a larger organization with more a more complex structure and larger set of stakeholders (like boards, capital partners, etc.), that is not the case. So practically, EOS is easily a better fit for nimble, growth-oriented, privately-held organizations. That’s the audience we’re laser-focused on helping, and those are the people for whom it works best.

Morris: In recent years, you have conducted full-day EOS sessions with leadership teams of more than 100 companies. To what extent have the nature and extent of the challenges leadership teams face to today changed significantly [from those they faced only 3-5 years ago? Please explain.

Paton: I don’t think they have changed, Bob. The real root causes of the issues leaders face today are the same as they faced a decade or a century ago. They have issues with their people. They’re not all on the same page. They’re not running their business on data, making better, faster, fact-based decisions rather than running on feelings, emotions, and egos. These are age-old challenges, and they may look slightly different than they did years ago, technology may have accelerated the pace a bit – but the root causes are similar if not identical.

Morris: For those who have not as yet read Traction and/or Grip, please explain what differentiates the EOS system from all others?

Paton: I’m not an expert on the differences between EOS and other systems for running a business. What I can tell you is that Gino built a holistic system that treats the whole body of a business, not just a few of its parts. And its focused on identifying and resolving the real root causes of the common issues facing entrepreneurs and their leadership teams, not symptoms. Lastly, there are no theories, no abstract concepts, no silver bullets or management fads – just a complete set of practical tools that helps leaders get more of what they want from their businesses.

Morris: What are the especially important dos and don’ts to keep in mind adopting the EOS system?

Paton: You cannot run a great organization on multiple operating systems – you must choose one.

Morris: When implementing it?

Paton: Less is more. Have fewer rules, stated simply. Establish fewer priorities (and get more of them done well). Repeat yourself often. Be open and honest – with yourself and your people. Have the tough conversations. Be consistent and lead by example.

Sun Tzu once claimed that every battle is won or lost before is fought. I think that the success or failure of almost every change initiative is determined before it is launched. What do you think?

Paton: Two thoughts. First, the battle plan and/or the people who put it together must be good enough that the people who are about to race into battle believe it will work. But I also like General George S. Patton’s quotation, “A good plan violently executed now is better than a perfect plan executed next week.”

Morris: Of all the great entrepreneurs throughout history, with which one would you most want to share an evening of conversation if it were possible? Why?

Paton: George Washington. A simple human and practical businessman who – when asked to serve – agreed to help. Someone who never considered himself a great man, but who helped others achieve their potential in war, in building a great country, and in overcoming massive challenges to build something of enduring value.

Morris: Long ago, Thomas Edison observed, “Vision without execution is hallucination.” Your response?

Paton: Gino and I paraphrase Edison often: “Vision without Traction is hallucination.” Most entrepreneurial companies have plenty of Vision. What they lack is Traction – the focus, discipline and personal accountability at all levels of the organization – that ensures everyone executes on the Vision every day. This is what EOS brings to an organization – organizing and harmonizing all of the human energy so that everyone is contributing to achieving that vision.

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Mike cordially invites you to check out the resources at these websites:

EOS Worldwide link

Mike’s Twitter link

Mike’s LinkedIn link

Mike’s Amazon page link

Mike’s YouTube video link

“EOS Story” YouTube video link

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