Podcast Transcript:

[00:02:21] Sean Steele: G'day everybody, and welcome back to the ScaleHQ Podcast. Welcome back to our regular listeners and to anybody joining us for the first time, we are thrilled to have you. My guest this week is Karen Kovaleski. Karen, now a Management Consultant. It looks like from the last sort of 12 months or so after 20 successful years in leading startups and growth stage companies in digital and tech, and what I love about your background is you've done all the hard yards in the same way as I kind of grew to see, you've done sales, you've done marketing, you've done HR, you've done operations. You'd done all the stuff. You've designed customer journeys. You've been everything from VP, Operations, Vice President, CEO, and all the way from startups to companies, more than a hundred mil. So, lots of diversity. I'm stoked to get some time with you today. How are you?

[00:03:08] Karen Kovaleski: Thank you. Well, I am thrilled to be here and be able to chat with you. Yeah, I have that crazy background that so many of us get to have, which is so fortunate because we learn with our hands and by getting in there and doing the work and then hopefully being able to translate that over time into new industries and new methodologies and new technologies that probably weren't there when I started and are there now. But we had some great learning and we understand how the business, but yeah, I've done a lot of different things in a lot of different industries and I've been very fortunate with that and it's been great.

[00:03:40] Sean Steele: Well, my kids are now 18 and 15 and they laugh that my first sales jobs were in directories where people used to still get the yellow pages. I'm like, yeah, these like huge books get used to get delivered to everybody. And you'd look for a phone number and they're like, what? ...Why did you do that?

[00:03:54] Karen Kovaleski: My first advertising job, we used to call on the phone and talk the words that were going to go in your ads in the paper on the weekend. So yes, I just dated myself very good.

[00:04:06] Sean Steele: You know what, actually we bought a business that did that. So, like I’m with you and I'm all over it. Actually, the previous sales job to that, I was in a warehouse in like this industrial area and it was literally like boiler room style, like 25 desks with just a phone and a white-pages, which was just, you know, the director was like; okay, just call people. We're going to invite them to a seminar and that's what you're going to do all night long for days and days.

[00:04:28] Karen Kovaleski: That’s what they called cold calling, right? A good old fashioned cold calling.

[00:04:30] Sean Steele: Was real cold calling.

[00:04:31] Karen Kovaleski: Was the beginning of the days, yeah. So, we've all been in the trenches. We've been in the trenches in different places, but definitely been in the trenches, yeah.

[00:04:39] Sean Steele: Well, I guess a bit of context for our conversation today for the audience before we just ramble on. We was introduced by a colleague of both of our, Sean Flynn, who runs the Silicon Valley Podcast. So, I believe you've done your interview with Sean, but it may not have been published yet.

[00:04:54] Karen Kovaleski: Yes, I don't think it's not quite published, yeah. We just did recently, yeah.

[00:04:58] Sean Steele: And one of the things that Sean mentioned to me was that he said, like, Sean, you've got to chat to Karen. He goes, you're absolutely going to love Karen. And I was looking at your background and I could see that you're really big, you know, from your experience on organisational alignment. And I am too, and I'm so excited to have this conversation with you because I saw this, when I was kind of researching, I saw this thing in your LinkedIn profile, the statement about the challenge of alignment. I just want to read it out because I think it's really important for people for the context for today. You said; "Companies often struggle to connect the dots between the corporate mission, sales, product delivery, and customers goals, M&A, rapid growth, and other disruptive processes typically amplify misalignment. And then when they're not addressed, that leads to missed opportunities for revenue, for employee engagement, for customer satisfaction. But organisations who try to solve that essentially through this customer focused approach in the hope that that is the rallying cry that's going to create the alignment of everybody and the product and the process, it just doesn't happen. And actually, then your brand starts to suffer, engagement declines, customers are going elsewhere, et cetera.” And I could not agree more. Like I see that growth putting pressure on misalignment all the time. And like almost the natural go to is, Customer first. Okay. We'll solve this just through, the customer will generate all the alignment. That's not a solution.

[00:06:17] Karen Kovaleski: That is not a solution. And I often say too, rallying cries, those are just cheers that is an action that doesn't have a method, doesn't have a madness. It's important, you know, positive feedback and energy, those are important things, but those are not the results. And, you know, I'm pretty passionate about that and I know we'll talk further about it and I can expand, but I'll also say one of the reasons more recently, and the pandemic opened up a time slot for me. I decided to go back and get an HR certification. And it wasn't because I thought; oh, I'm going to go into this industry specifically as HR. It's because as you and I noted, we've been in all parts of the industries we are in our businesses. We've worked with people. We've been managers. We've been CEOs. So, HR is part of it. It's the cultural confines. And I wanted to sort of reassess my perspective and brain and make sure that I am in alignment with utilising all of that as you continue to develop in corporate structures, whether you're at a startup or going into larger, that we continue to take into perspective, the risk management, the financials, but the human aspects of all of it. And when things aren't aligned or when they aren't working well, what's that trajectory and what can happen. So, it's been kind of interesting that I did that and I was like, okay, yeah, this is it. And it's just added a little bit more fuel to things that maybe I've been doing or been looking at it. It gave me a little a refresher of one aspect of it. But yeah, that is one of my passion points in, in anything in organisations. Yeah.

[00:07:55] Sean Steele: I love it. And look, that's precisely why all the work that I do with Founders and in the courses I've developed, we first build a growth strategy, but then we build an execution plan where the full thing is aligned from top to bottom. Like the job is to make sure that everybody has clarity about what success looks like for the organisation and for them individually; both in the long term and the medium term and the short term. And then you've got all those feedback loops built into your execution rhythm so that the growth plan is getting reviewed. The priorities are getting reviewed. Things have been constantly realigned and everybody's always aligned to what success looks like. And in the absence of that, you've just got a whole bunch of randomness going on. And you see Founders with this frustration of having to put out fires all the time. I'm like, well, that's because you're not allowed, they've got their priorities and you've got something in your head that you think is trying to be achieved. And there's not like, there's no framework that integrates it. So, talk to me today. Like I challenge you to say; Hey, like, well, what's your framework? I want to learn from you and how you think about it. Could you maybe share a story, like to give us a bit of a frame around this, maybe a story that's had these kinds of misalignment issues and that was able to solve them by applying the way that you think about it?

[00:09:02] Karen Kovaleski: Absolutely. And I can tell you. You mentioned in the thing that you read that it says, mergers, acquisitions, massive growth, startup influx of cash, capital, even, I would say market structures. But if we really talk about internal, all of those things amplify it. But I can give you a story that came early in the career that really helped me sort of solidify my framework in the way I think about it. And then over the course of my career, I've been lucky enough in those other organisational roles to apply it to, you know, this one I'm going to share because it's really easy to see it in M&A. It's super easy to see the dysfunction. So, I'll give you that as an example, but I was able to apply it to a startup and a growth stage and someone that was very highly funded, but that creates its own chaos and so forth. So early on, you know, early enough, my first10 years, and I was with them for 10 years, I started my career in advertising and in advertising, you kind of go up and you're in management. And this was some years into my business work and I was a general manager and we were acquired by a…we were kind of a midsize company, so national, but not like, and we were acquired by a larger company who did a particular aspect of advertising and wanted to branch out and the way they were going to do that because they had the funds and they were large enough was acquisitions. So, they acquired. And I don't mean one or two, I mean an extensive amount of acquisitions that gave a national footprint than an international footprint. So, people, places, and things, as well as some technology that was going to be built, and there were two companies. So, in the acquisition process, the majority of those organisations were mid, some were small, but midsize, I'd say small to mid, so that they were really engulfed and brought in, but we were doing the same thing. So, the easiest, this goes back to that idea that customer is nothing's going to change. We all do the same. We're all advertisers. We are in this niche. This is what we offer. Here you are. Well, the reality is everybody did it differently. Everybody had different sets of skill sets. And very quickly with such great. I mean, it was an all-consuming experience, but with such great expansion, there was access to these great clients and new avenues and people would walk in and go; Oh my God, we're so big now. And we've been acquired and look at all these things we have to offer. But they didn't know what that meant. They didn't know how to execute on it. So, you had salespeople rushing outside. You had existing client folks who were managing day to day clients and the clients going; Oh, your name changed. And I write checks differently. Like, what does that mean to me? What do I get? Oh, we have more things. Right. And it was just a very dysfunctional, not on purpose. You know, the hope was to try to keep things moving until you could do it. And then even the simple, in that case, back office does tend to have problems like invoicing and so forth. And so, it was during that, there had to be, and so those of us that were in that management executive level in the various regions and areas had to come together and start back where I think about it. And I have my, I think of it as, I call it; educate, motivate, activate, evaluate, and iterate. Those are my kind of five steps. And I don't think I had the words to that back then, but it was the process. And we had to sit back and start with the educating of right down to then I can share more about those individuals, but it starts with who and what are we today? Not where we were, not what we were, not what they were, but now we're this new entity and what does that mean? And not to make it fluff, but what is the mission and the vision and the values and sort of like who, what, why, where, and then start at that point and kind of apply it out. So, really it, it gave me such an extreme example and it's an extreme real case. I mean, we worked on that and then over the course of my next how many years I could apply that same sort of methodical step and you can do it in departments. You can do it for an organisation and they aren't all and I'm not professing, in that case, it was a kind of a long drawn out, very complex process, but in others it's not. In others it's a little quicker, but it's still the same steps and same methodology when things start to change, when you start to notice that clients are leaving more quickly than they're coming, or every time we get a client, we lose two or the revenue is not the same or something seems off. If you can just pause, and set that stage again to make sure that you've been staying in alignment, you usually can find the fixed quicker, other than just throwing a lot of band aids at, oh my God, we're losing clients. Well, we got to do whatever they say, right? Like, let's fix that. We're obviously not providing good service and let's change out our account teams like that happens a lot. People just want to get rid of whoever's there or they want to change their products or services because a client got mad. So, that's not really the right answer always, it could be, but it might not be. So, that this just gives you a pause and a step back and kind of reevaluate and figure out where the gaps are in your alignment. So, that's how I started it. And that's what it looks like in the highest level. And then each of those obviously are more detailed and I'm happy to share those details.

[00:14:31] Sean Steele: Yeah. Absolutely. And so I guess, one comment there, having done quite a lot of M&A and lots of integrations, and like you realising that when you build methodology and then you get to apply it into a startup business, and then you have to apply it into a really large business and then a medium sized business, you learn a lot about the stuff that actually matters and you kind of get to get rid of the fluff that doesn't matter. So, I'm really keen to understand those steps and like, what do they actually include? And conscious of time because I know we also lost a little bit of time today. So, let's get into your steps. I'm really keen to hear about it.

[00:15:07] Karen Kovaleski: Okay, so I'll go more quickly and then if you have questions, you can ask me. So, you know, when I talk about educate, there is a bit of educate the business, the people, the teams, kind of staff and all of that. And I start, as I said, with that… Who are we now? What does it look like? What is our mission, our value and vision? And I don't mean that as a placard on the wall, but really what are we here for? What are the values in which we're working, but what is our vision of where we want to go? You know, and when you look at the employees, what's working and what isn't for them in that process what right now as I'm walking up and down the halls and I'm hearing things you know, where's their challenges? How do we hear that? So, there's a little bit of like let's just get into the weeds of the people and hear what they have to say because they're a great resource, you know your clients… What are the clients looking for? What's been working well? What seems to be changing recently? So, you're kind of educating yourself on that nuanced change and then process and delivery if you're service or if you're a product, is there a disconnect lately? Where's the gaps? Where hasn't been working? Is the length of delivery changed is? And this change is obviously a B2B or B2C client, but you know, are we losing out on upsell opportunities? Are we taking too long to implement? What does that look like? And so just a very quick kind of your employees, your clients, and your processes, your products and products.

[00:16:29] Sean Steele: Sounds like a, I guess a reality check, right? Like, let’s just regroup on where are we right now? Yeah. Okay.

[00:16:37] Karen Kovaleski: Yeah, forget what we think we, you know, we used to be so good. You know, I used to touch my toes. I can't anymore. Yeah, we get it. But today you can't. So, kind of a regroup. And then in that process, it is the clarifying of the brand and the mission. Like, okay, so now we know where we are. What was it that our brand is about? What is it that we're attempting to do? What is our goal? Where do we see our trajectory? What is it that we want in that case? Like, why do we exist? Where's our intentions? And I even say, depending where you are, you do another SWOT analysis, right? Who are the competitors now? Did something change? What's the marketplace look like? Was there an influx within, because outside in forces. So that's kind of the educated, so it's a quick, and again, I'm not suggesting this as a six-month process. I'm talking like, let's get down and dirty and get this done.

[00:17:24] Sean Steele: It sounds to me like it's a scan and a communicate.

[00:17:28] Karen Kovaleski: That's a great way of saying.

[00:17:30] Sean Steele: Like, let's get a full, let's scan everything. Look at the external environment, what's happening with customers, what's happening in our market, what's happening with competitors, let's look internally with us, what's happening with our team, what's changed maybe since before. And also, you're saying, let's get clarity on where it is that we actually want to go. So, we're not yet talking about the strategy in terms of how we're going to get there, but we're talking about why we're here, and actually what our vision of the future is, so we know starting point before we do anything else.

[00:17:56] Karen Kovaleski: Yeah. That's right. Because if you don't have the starting point, then, visions and a lot of this is, people are tracking all the time, tracking numbers. It's just like, what do you do with those numbers or what do you do? So, some of this is numbers and some of this is like I said, walk in the halls and talking and getting to people. And then I always talk about the motivate and when I think of motivate, you know… Motivate is step two. And what I mean by that is, is there is an action in motivate. Motivation comes from an action in an understanding about what we just learned. So, right, we're going to motivate because when we're going to inform everybody, there's probably a certain number of people that are taking these scans in an organisation. So, now it's all right. Well, now that we've done… now, we have to have a strategy. If that was is our direction, and that is our goal, and this is what we've learned. There is some misalignment. So, let's get people motivated around. Here's what our goals are. Here's what we're going. How are we going to get there? So, what does that strategy look like? How are we going to create the solutions based on those goals? How are we going to make sure the goals are aligned? I kind of talk about one of the great examples is when you start doing, let's say private equity comes in and they're like, you're going to grow 20 percent quarter over quarter. That's high level, but that has to align all the way down in that my salesperson knows their goals, but the finance people and the people that send invoices, your goal is to get them out, get them quickly, get it paid, make sure we get returns that we don't have gaps. And then you hit your numbers and you're not forcing the incomes coming in when it's supposed to, you know, there's lots of things that support so that every goal, even if it doesn't look like it's a revenue-based goal is supporting a 20% growth. So, we talk about goals. So that motivate is like, here's what we've just decided, now we're going to make out the plan. We're going to do our strategies, we're going to ensure our solutions are aligned. We're going to set out our goals. We're going to verify how we're going to kind of communicate out to the market. We've kind of figured those things out and then we're going to figure out the flow of the process to get there, and everybody's going to be on board because now we're all motivated because we understand what the purpose and the procession. So that's step number two. So, motivate in my mind is a different than what a lot of people think in terms of motivate. Motivate is motivate the movement.

[00:20:05] Sean Steele: And so, just to recap on that, what I'm hearing is, you know, in stage one where you're going; here's where we're at now, and here's where we want to go. So, we're kind of setting up the framework for movement, but we haven't actually talked about yet what movement looks like or how we're going to get there. In step two, you're saying; all right, in this part, we actually figure out the strategy, like what are we actually going to do and how do we make sure that all the goals of all parts of the organisation are aligned to fulfill that ambition and that direction that we set up so that it creates that sense of; okay, not only do we know where we are, we know where we're going and we've now agreed how we're going to get there and what our priorities are as a team. So that's the mode of that creates the sense of how we're going to move towards. Okay, that's great. And so, what's the third step?

[00:20:47] Karen Kovaleski: And that motivates people because, you know, and then the third step is action. And so it's, now we have to actually execute because ‘yay’ for all the other stuff. But if you don't execute, it doesn't mean anything. You know, I'm kind of always like... So, this is the part where, now we've set up our goals, we've set up the communications plan. So, it's a kind of a balance between the revenue generation, the revenue management and your processes. Like, how do you start to do it? But you're really telling people to now go out and do it. You've got your plan, you've got your KPIs, you've got it. We need to do it. So, you've got your teams that are leading it. You've got goal execution, you've got internal management execution, you have operations, and within that, how are you monitoring it so that you can then do the evaluation? But that's really what execute is, is it's actually doing it, making sure that it's happened and right down into, as I say, branding and clarity for brand is really important. So, back when you were doing your strategy, you were also talking about how you're going to externally communicate this as well as internally communicate. So, when you start executing, your communications may change, they may not, depending, but you've got some nuanced differences that will come out as well. So, that's a key part of it.

[00:21:57] Sean Steele: Okay, so in your execution step, this means people know what their priorities are because that's happened at sort of stage B. Now they're actually doing the stuff, but you've also built in what I'm hearing transparency on actually how that's going. So, you've got visibility, you've got some feedback loops to know that actually what's happening, that whilst you're executing. You're also communicating that might be constant internal communication about how that's going, but also external communication. You know, you might have, to your point, your vision may have changed, your strategy may now be different, how are you communicating with your customers about who you are now or what that means for them or…

[00:22:35] Karen Kovaleski: Exactly. Decks may have changed, you know, all those kinds of things may have changed. And then when you go into evaluate, you can imagine, there's the internal and the external evaluations. So, you know, how we hit the numbers. But more, if you have new business coming in, what does it look like? Does it look like what it used to? Are they changed? Does that make a difference when we didn't make, when the sales didn't come in? So really evaluating against the KPI, but getting a little bit more granular in terms of did anything miss the mark. Did we execute as we thought and did it come out the way we thought or did we execute and something still missed? We thought that it would resonate with this size company and these number of people and this is the way it would go. And actually, we're finding that where we sold it was here instead. And so, when that change happens, it happened in maybe the sales group and now your account management though, is going to have an iteration on it, because that will impact them, which then may that then impacts the way you're possibly you're invoicing is going in your communication. So, there is that point that comes very quickly after the evaluation of recommunicating and iterating based on how you've evaluated the vault. Just those results. So, it's the evaluation, but remember that many times evaluation is going on, but it's going on in its division. And the only way it's communicated is in some meeting once a week where everyone spews off very quick KPIs, but then they walk out of the room and go; oh, we didn't hit our number, we did hit our number. And that's about it. So, this is more …

[00:24:04] Sean Steele: Just making sure, what I'm hearing is, you know, so whilst, in step three, you've got everybody executing and you're gathering, you've got transparency on the data, but at stage four, it's about how you actually think about what is going on and what does it mean for the whole organisation, not just for that team or that division or that area, it's how do you make sure that those are flowing back and someone's looking at all of those things as a pattern and going; okay, do we need to make new sense of this? Because to your point, one part is going well, one part is now going really poorly. What does that mean? Does that mean anything new for priorities for how we communicate? Is it actually isolated to that team or is it actually something that's going to create downstream? How do you flow that information back up to leaders that can do something about it?

[00:24:48] Karen Kovaleski: Yep. You got it. And you said it even better. And I will say, and I didn't mention in here that a big part of this too is I think I mentioned skill gaps too, right? When you start to evaluate these, it doesn't always mean that anybody is good, bad or indifferent. It's just that, do we have a skill gap? Is it something we can train? So, sometimes when this happens, especially if you've had to change, if you've had to re… you know, I was at an organisation where we changed a business model and candidly there was a big group of people that weren't aligned with the new business model and they weren't going to be. It was selling. It was a completely different function and the way that they were going to have to sell and speak to it. And some were interested to learn it and some were like, this is not my thing. So, skill evaluation, skillset comes out of this as well. And then, as I said, then you iterate. So, once you've done that, the last step is iterate. And iterate can mean very little. It can mean; great, let's do it again. We're on track. Or it could mean here's some small nuances that are changing. But I think on a quick, you could take these steps on a very high level very often, right? Or pull them out. But I find that it's critical when there are major changes and it's important and critical at certain milestones regardless. You should do recheck-in just like we have annual checkups with our doctors, supposedly, we should have these checkups with our organisation, because things do change. Our markets change. Our needs. I mean, look, pandemic threw everybody upside down. I think that taught us even more so, those of us in the businesses we've been in with startups and so forth, maybe sought more often, but I think these last years have really brought it to light to anybody that, a lot changes. And then how do you flex your time? So, as I said, that's really where, and it started with something where you couldn't miss it when you're doing massive integration, like you can't miss the disconnects that it's so there, but you really notice it as you start to work in all kinds of organisations, not intentionally, it is an evolution that happens.

[00:27:59] Sean Steele: Is it fair to say, so let's do a quick recap. So, the first one was educate and that's really about getting a current state of play. Like, you know, you're just gone through a change or you're about to go through a major change or your markets changed or something major changing. Like, I need to re-get everybody back on the same page about where we're at right now and where it is that we're trying to go. In stage two, you are in the motivate stage, is about actually setting up the plan and the priorities and the strategy. And what are we going to move towards? And how do we get everybody aligned to that? So, everybody knows what the big priorities are. In step three, they are executing. So they're going out and they're doing the thing. And in step four, you are evaluating basically how that's going and you're trying to make sense of it, not only within your teams or divisions or functions, but as a whole organisation, and what does it mean to the priorities? What does it mean in communication? What does it mean to what, you know, any part of it. And then finally use the iteration. And so that is, where do we need to make changes and actually making those changes to communication or priorities or team members or skill sets or whatever needs to change to ensure you stay on track.

[00:29:05] Karen Kovaleski: That’s it. Yeah.

[00:29:07] Sean Steele: And I love that because it's a really nice way of articulating in a really simple form. And people can go; well, that just sounds really simple and kind of obvious.

[00:29:19] Karen Kovaleski: Yeah, it does.

[00:29:20] Sean Steele: Yeah, it should be simple and obvious, but it's never simple and obvious if you haven't done it before, and you've grown up in an organisation where you've never been part of somebody who's done that well. And so you may not know actually how important it is. And so you're building your business, you've built it from small and you're just good at doing the stuff and getting the stuff done. And all of a sudden there's a major change. You've now had no leadership development and you're a Founder of a, I know the 30 person business now or 50 or 100. And all of a sudden you got to go through the major change and you're like; I've never actually had to do alignment. I've just been doing, I've just been executing and execution has been working, but now something has to change and I have to realign all these people. It may not be M&A, it might just be, I'm going to set an entirely new strategy or something as massive as changing our customers or a product sets going to move or…

[00:30:08] Karen Kovaleski: And you know, so two things I'll tell you is I think, the misalignment, as I said, it's often very unintentional, right? So, as you just gave an example of a Founder that kind of grows his business. Those Founders talk all the time and they chat all the time and they're communicating and if you listen to what they say things change Or they accidentally throw someone down a rat hole to go chase something because they thought well God wouldn't be a great idea if… and they don't mean to but it goes one direction or they were out with a client and agreed to something because they got excited about it. So, there's a lot of things that throw it off. I'll tell you another one that I've seen and it is when funding comes in. And you know, if you've ever been involved with, which I know you have, but involved with fundraising, there's obviously lots going out about where the money is going to go. But when funding comes in, and it's either more than you expected, or you are a well-funded startup, what can happen really easily is those dollars get thrown against. The good old spaghetti against the wall and see what sticks. It's just habit. You have funds now to do the things you didn't get to do. And that's another area where it's very quick and very easy to get off track and to misalign, again, not intentionally, you're actually are trying to solve everybody's problems, but you've lost the focus because, and it doesn't mean that you've spent the money too much. It's just that it's very easy to sort of redirect your energies because now you have the ability to. So, that's another time where I say it's always really important to just do a sanity check and make sure that things are still in alignment. And if it's not, as they say, parking lot it and maybe relook at it when that time is right.

[00:31:51] Sean Steele: The interesting thing about this, Karen, is that you can do this rhythmically. Which I'm sure as you developed your methodology, you found a way to build this into a rhythm. Like I, as a CEO, it's in my DNA to not like randomness. I don't like randomness. I'm very structured. I'm very organised. I'm very ordered. So I don't deal well with constant uncertainty and stuff that is changing all the time, I just can't operate that way. And so these structures helped me, number one, having a StratEx, which was essentially is probably the first two components of your five steps. It's like the clarity on the long-term, the medium-term strategy and the short-term priorities. So that in literally in one kind of A3 page or one desktop background, everybody's got absolute 100 percent clarity about where we're going, how we're going to get there and what the priorities are. So that's on…

[00:32:43] Karen Kovaleski: I love that, I love that, yeah.

[00:32:47] Sean Steele: But to your point, that's just the start. Great. You can communicate that to everyone. You can get people motivated around. It's like, good, we know where we're going. Of course, all the magic is in the execution. It's wonderful to have that plan, but the magic and the difficulty and the hard part, of course, is actually then executing on the plan, having all the feedback loops built in so that you know what's going on and then knowing what to do about them as you go. And then if the plan is not working or it needs to be changed, we'd always review that strategy on annual basis. Maybe not like redo the entire strategy, but updated and iterate it. And every 90 days you're looking at what's going on and do we need to change the priorities? But having that in a system allows you to feel confident that you've got a model that, it's almost like you can update the inputs at the top of it and it all flows back through the model so that you get everybody aligned again, if anything's going off track and I really valued. I valued as a CEO and feeling comfortable that in multiple entities that I knew that everybody was following that structure. And so if anything was happening in those entities that was creating misalignment, we had a process to capture it, feed it back in, make the changes, realign everybody and keep moving. I think that's the thing that really takes a lot of pressure off the CEO having to watch everything because it's like, no, the system does the watching, and you've got a process of realigning everybody.

[00:34:02] Karen Kovaleski: Yeah. No, that's fantastic. And I think that's why you've built this next part where you are, right? Where you're helping other CEOs and people do that. Because the truth is, as CEOs, the other struggle they have is they start a business and their hands are in it. And they're in a way selling themselves and their own, and so as you grow and you are becoming a little further removed, it's harder and harder and it gets scarier and scarier whether you communicate or you can't let go. And so knowing, as you said, having the confidence that something's set there and that as new people come on, or when a hire doesn't work and you have to change it or you have a whole new team or whatever happens, there's a system for both communicating to them the process and how it's evaluated and that this is what we do and this is just part of our DNI. And then I think people also aren't as concerned about the idea of giving their feedback. You know, I said to somebody the other day, I'm like; oh, we had a meeting and I said everything we failed at. I told them right out everything like, really, you know, I feel it a lot. I would never tell anybody. I'm like, but you have to. So, I think that's the other thing that's important when you're in these, this isn't about failure. This is about evaluating, monitoring and iterating. And if you let people know, especially in a workplace environment, that that's part of what we do, it also creates an environment where you… it's out there and you aren't afraid to let those pieces be known and you aren't afraid to communicate when something doesn't seem to be going right, even though maybe you named it, right? You put your name on it and you said, this is what we're going to do. And you're like; oh gosh, it's not really working. So I think…

[00:35:35] Sean Steele: I always get scared when I hear people say things like, you know, ‘We can't afford to make any mistakes here.’And you're like… What? do not say that to anybody. What do you think they're going to do? They're going to like shrink into the safest, most conservative, most risk free situation. The behaviour, like no one is going to be like going out on a limb to delight a customer or something. They're going to play it super safe. And then therefore, all of the onus is now back on you to absolutely design the perfect thing every time because you've got a bunch of order takers in your organisation and no one's thinking for themselves cause they're scared of you.

[00:36:08] Karen Kovaleski: You can't do that. And collaboration goes away too. Because if you're afraid to make a mistake, nobody wants to speak up or collaborate or do anything because they're like, Oh my God, what if that messes up? So yeah, it's a really tough. So I think that's the other piece about what you've set up and what you're talking about in your organisations and when you're working with other businesses is that it's got to be part of the DNA. So, everybody is comfortable with it and that people aren't afraid. And then you just have such better outcomes. I come from old school. We used words like brainstorming and collaboration. And it was okay to say that. And that, you know, these days I'm…

[00:36:42] Sean Steele: What's the new words for those?

[00:36:43] Karen Kovaleski: I don't know. But I said brainstorming one day. And so they thought I was a dinosaur. I was like, what? Isn't that where y'all get…

[00:36:47] Sean Steele: Really? I didn't know that. But now I know that I'm a dinosaur.

[00:36:51] Karen Kovaleski: Yeah. Don't say

[00:36:54] Sean Steele: ChatGPT, what's the new word for brainstorming that's really cool?

[00:36:56] Karen Kovaleski: Yeah. There you go. Perfect. Exactly. You know what? Good idea. I'm going to do that when we get off. I'm going to go find out what it is, but I had lots of looks that I think, who knows? Anyway. But I think that's part of it, right? We want people to be encouraged to communicate and keep going and then to be able to reach the next goals so that if you are fundraising or building or expanding, then that expansion, you have a method for that too, because you're going to communicate the same things wherever it goes.

[00:37:26] Sean Steele: Karen, actually, you know, a practical example of that, which I think was something that we learned over time. We didn't have this right in the first few acquisitions, but we learned in the later ones was, we actually quite quickly put together just like a one page summary on what the strategy was going to be for the combined organisation, , that we would constantly actually iterate and come back to and share with the new teams. Because to your point, if people don't feel like this organisation is going to be better, like, I don't know what the combination of these two organisation is going to look like, but if I feel like we are valued, if you are the acquire, you're feeling pretty nervous because somebody else is making all the calls. If you can't see how we get better together and what the new model looks like, it's quite disconcerting. One of the questions I had for you though, was what do you see CEOs struggle with the most in these five stages. Like, where do you think the most difficult points are from your perspective?

[00:38:23] Karen Kovaleski: So, I think the hardest part, that I've seen often is, I'm going to say it's in the motivate and I say that because I think that often, there's a jump from here's what we are and we need, especially early stage startups. So, I'll sort of caution it there. When you're looking at an early stage startup, they've decided who, what, where they are, what they want to be. They've been talking about it with forever. They've been working on it. They sit in it and it's just ingrained in them. And in fact, they're the best, like listen to them talk and you're like, oh, okay, I get it. And then they jump to, because we need to get revenue in, we need to get revenue in order to get investors or we need to get revenue because we're going to do a bootstrap or whatever it might be. So you jump, you're talking yourself and you sell it that sometimes the definition of how we're going to do it, falls apart. Not that it isn't being done because they're doing it, but you jump over that stuff, that like if we had a team and there is a reason to it. So, you say, I understand, but now if we get, so, okay, you've got a little bit of revenue, we've got to build an organisation here. We can't do it. So I think that when you talk about early stage startups, it's natural that that's one of the challenges. I think when you get to the larger and organisations, I believe, I feel like the bigger challenge comes to the evaluate. And not because they aren't evaluating, but because the evaluating isn't being shared in a holistic way. Again, I go back, you heard, you know, I had a flip comment that everyone sits in a meeting and you have the head of sales say this and you have this and everybody gets it and goes, oh, and then they complain about sales didn't hit their numbers or this or however that conversation may or may not go or everything is phenomenal. Everything's great. We all move out and pat ourselves on the back. There's like one of these two things, and there's probably lots of side conversations and I'm not saying things aren't happening, but to really go back. and to dig and to start back at the top when things go a little bit wrong or something that doesn't come out the way you expected and better or worse, right? If something's taking off, it's like, wow, how do we put more fire to this? Like, geez, this is great. Like, I thought it was going to be good, but I didn't think it was going to be that good. Let's figure out how to put a fire. So, I feel like as you grow, it's that piece that lets you do your iteration in a more methodical way. That's the piece. Doesn't mean they're not tracking, doesn't mean the data is not coming in, doesn't mean people aren't managing, but they're not putting it together as wholistic.

[00:41:04] Sean Steele: When I think about your comments about the motivate piece, which sounds to me, like I just immediately could see Founders that I know who rely on that, you know, when they're kind of growing up, they rely on almost like the charisma and the commitment to the vision. And they've just jumped straight to execution, like; okay, let's just go and do a whole bunch of stuff. And like, just make things happen. It's like, okay. And to your point, you're missing strategy, you're missing priorities, you're missing structure. Like how are we going to make sure that people focus on the right things? You're missing actually the thing that creates the alignment. And so you end up with a lot of randomness and a lot of things to manage, and a lot of pressure on that CEO. And then in the evaluate piece, I remember being an executive in an organisation and realising, because we had some great external coaching as a leadership team. And had this like game changing moment in my mind that shifted the identity of the whole leadership team. And it was, each of you is operating as a functional leader, and that is your job. You're a director of sales, your director of operations, your director of marketing, blah, blah, blah. But actually your job is not to do that. Your job, each and every one of you is to think and act like the CEO. And that means in a leadership meeting, when to your point, your job is not to come and go, I'm just here to report on my stuff and this is how I'm going and this was happening in my business and then like everybody's just taking their turn and it's the CEO's job to think about what's happening. And it's all of your job to be sitting in a room as if you are now seven CEOs, including the CEO thinking about what do all these pieces mean together. And that to your point, when you've got some leaders in your business and lots of the people who listen to this podcast or somewhere between kind of one and 20 mil. And the time they're getting to maybe like 5, 6, 7 up to 15, they're hiring managers, or they’re hiring leaders. And you've got that opportunity to take some of the pressure off you as a CEO and generate good quality conversation. When you tell people that all of our job is to think about what all these pieces mean together, not just my job, actually all of your jobs. And that elevates them professionally, it helps to develop them, but it also makes them feel like they can contribute more. So it creates a good leadership sort of style and people value being part of that leadership team because they're growing, but it also takes a bit of pressure off you.

[00:43:27] Karen Kovaleski: Yeah. That's perfectly said. And I think that it's, I mean, you can see it and you can see it happen. And again, I don't think any of this, because there's brilliant people out there, right? They're doing it and they made their companies because they're brilliant and they know what they're doing. It's not about that. It's about. Finding, as you said, a methodology or a system that works and being consistent with it and having the resources and somebody just to help move that along because day to day business distracts you every time, it always does, and it always will. And day to day operational needs of the human beings that are behind it, distract you every day and they always will. So you have to have the systems and processes to help you when that happens, remember, yes, we get that, but we also have to do this too.

[00:44:14] Sean Steele: And I go back to thinking about this entire conversation, thinking about what does alignment actually do? You know, it ensures, if you can't put your hand on your heart and say, every single person in this business knows what long-term, medium-term and short-term success looks like, what does actually success look like for the organisation, but also for the individual, then you do not have alignment. Like if those two things aren't in place, then you do not have alignment and you are going to be dealing with misalignment. And to your point, and your LinkedIn is; If you don't have that and you put pressure on the business, you are going to create chasms and cracks and problems. And it just gets more complicated to solve until you actually go back through those steps sequentially and go back to number one and restart with the reassessment. And then, yeah, yeah, it's so fabulous. Karen, can I ask you, and I'm conscious of our time, we're going to need to wrap up. What's next for Karen Kovaleski, what are you kind of doing with your next stage, your next chapter? Where are you taking yourself?

[00:45:22] Karen Kovaleski: Yeah. My next days, so I'm about ready to, I haven't, it's in the works. It'll be out soon. I'm launching my new website, which is called pieces of sand and it is just musings. It's a little bit more about that and I do pieces of sand because sand creates many different things depending on how it's put together and what the pressure is and external impacts are, everything from glass to beautiful ocean fronts to cement. So, I thought it was a apropos and I live by the ocean, so that was my pieces of sand, but I'm going to continue to work supporting some different businesses as they need them and hopefully help them grow and aspire and get to where they're looking to go, and how that looks, it looks a variety of different ways from some of my consulting and contract jobs to some other stuff. So I'll continue to do this and take it into, I don't know, hopefully for a long time.

[00:46:19] Sean Steele: Well, you have been super generous with your time and I really appreciate the clarity you were able to bring to your thinking. And I think that's a really nice simple process for people to do. So what, you know, if you're listening to this podcast today and you're thinking, you know what, I just not a hundred percent sure that everybody is on the same page, as where I'm thinking and I'm seeing cracks evolve. This is a great opportunity for you to step back and actually take yourself through those five steps, and take your organisation through that process. And you can do it. You know, if you haven't done it before, that's cool. This is a leadership development opportunity for you and a personal growth opportunity for you as a Founder. And if you need help, you've got people like Karen or myself or whatever, you feel free to reach out. And this stuff takes, just for the avoidance of doubt, this level of clarity and simplicity comes from people like Karen, who've actually had to do this time and time and time and time and again, and make all the mistakes over 20 years. So I really acknowledge that the simplicity takes time to craft their experience. Karen, thank you for sharing your wisdom with us. If people want to get in touch with you or follow along with what you're doing, where would you direct them to?

[00:47:26] Karen Kovaleski: Yeah. So, I think original, I’m at LinkedIn, is probably the easiest and quickest right now and soon you'll be able to get me through the website, but for right now, LinkedIn is probably easiest and it's a Karen Kovaleski .

[00:47:39] Sean Steele: Karen, thank you so much for your time today. I really appreciate it. Guys, go and connect with Karen on LinkedIn. You can find the full transcript on the ScaleHQ website. You can find it on YouTube. You get the video version or the audio version on Spotify, Apple, blah, blah, blah, usual stuff, wherever you like. So, thank you very much. I've really enjoyed the conversation today, Karen, and I look forward to staying connected.

[00:47:58] Karen Kovaleski: Yes. Thank you for having me.

[00:48:00] Sean Steele: Awesome.

[00:48:01] Karen Kovaleski: Thank you. It was a ton of fun. All right. Talk to you soon. Bye.