Every week as SmallBizLady, I conduct interviews with experts on my Twitter talk show #SmallBizChat. The show takes place every Wednesday on Twitter from 8-9 pm ET. This is excerpted from my recent interview with @SecretEntourage. Pejman Ghadimi is the founder and author of the Third Circle Theory, which explains how some of today’s top visionaries are made. In the past 10 years, Pejman has held multiple leadership roles at the Vice President level for Fortune 500 companies and has established several successful off-line businesses including Secret Consulting, and VIP motoring. Since the age of 25, Pejman has been financially independent and has dedicated the majority of his time to bringing the Secret Entourage brand to life, a unique organization which focuses on helping motivate and improve the lives of young entrepreneurs worldwide. For more info, visit SecretEntourage.com and thirdcirclebook.com
SmallBizLady: Why do people matter in business?
Pejman Ghadimi: People are all that matter in business. They are the life-line of any business, whether you like it or not. Without people, there can be no future. I think many small business owners forget or have forgotten that other people are the reason they are where they are and can continue doing what they do. Society has become blind to the fact that money is a commodity that has no value if people are not there to help use it. Many small businesses are stuck in this mode to convert clients into revenue instead of revenue into clients. Sounds weird right? We think very one sided because that’s what everyone else has done. I have learned that investing hard earned dollars in my employees, allows them to, in turn, build my business faster. Invest in their growth, not in their bonuses or salaries. Think of how far you have come because you believed in your idea and yourself, and now imagine how much further you would go if only 5 of your employees would believe as much as you do, but all have 5 different areas of expertise. Do you think you would get further as 1 or 5?
SmallBizLady: By people, are you referring to clients or employees?
Pejman Ghadimi: I am referring to both. Without serving others, businesses cannot exist and therefore cannot grow. And, without employees that believe in a service driven approach to continuously serve each other as well as clients, the cycle of service is broken and the people are removed from the equation. Great small businesses understand their social responsibility to others who trust them enough to seek value from them, and understand their need to serve those who serve others on their behalf. People are the core foundation of why small businesses win or fail.
SmallBizLady: Do you feel that most small businesses fail because they don’t invest in people?
Pejman Ghadimi: Yes. Too many times small business owners forget to invest in their most precious resource – the people who work for them. Many small business owners worry about marketing, revenue, branding and often leave staffing to a reactive basis that is driven by need rather than a proactive approach to what we want. Consider the power of teaching others to efficiently help grow your business and, as a result, help them grow. You will retain employees longer, reduce issues by increasing loyalty and automate your business so you don’t get stuck working on it all the time.
SmallBizLady: Why are people more important than revenue in your organization?
Pejman Ghadimi: You can grow revenue in an organization by selling or marketing your business, but you can automate your revenue by growing people to market and sell for you. By investing in your employees, you can have 4 to 5 times more leverage with each action you take. While revenue matters in any business, how the revenue is generated and by whom is what differentiates winning businesses from failing ones.
SmallBizLady: Why is being people centric an important part of leadership?
Pejman Ghadimi: The word leadership in itself only encompasses people. When you think of leadership, you think of leading; and you can only lead people. You cannot lead numbers or revenue but, rather only people. When accepting the role of a leader, you have to be able to answer the simplest of questions before being able to create value for others. “Why should anyone follow me?” As simple as it is, if your answer is centered around growth, rather than value created for the followers, you might want to go back to the end of the line and allow someone else who accepts that social responsibility to take the spotlight. You are responsible for the success of each person you lead and they are directly responsible for yours as well. The one who creates the most value up front typically tends to receive 3 times as much back. That is simply the law of loyalty, or so I call it.
SmallBizLady: Why do you think so many organizations miss the mark when it comes to people?
Pejman Ghadimi: Because as a society, we have accepted that not everyone is born with the same potential or capacity and therefore often give up on people when they do not meet our expectations from the very beginning. Many CEOs tend to focus on their responsibility to shareholders rather than understanding that their shareholders would receive more value if their primary responsibility was to their employees.
Many organizational leaders ask if their employees meet their expectations, but very few reflect on if they meet their employees’ expectations. It’s an unfortunate direction the world of business has taken with this constant need for short term revenue rather than long term growth.
SmallBizLady: How can small businesses be more efficient when dealing with people?
Pejman Ghadimi: The simplest of ways. Coach and Connect. You cannot coach your staff without anyone knowing why YOU are the one that has the privilege of coaching them. Most only want to be coached by those they deem to be of superior knowledge or with a track record and the best way to do so is by connecting to your most precious asset – “People”, and by starting with your front line. Use the reverse pyramid method. Coach your front line before you coach your supervisors. While many leaders connect with their immediate subordinates, they fail to understand and connect with those below them. This poor approach leads to filtered information and often creates a bigger disconnect from the business owner/leader and the reality of those they serve
SmallBizLady: What is the 1 thing a small business owner can do TODAY to be more effective?
Pejman Ghadimi: Stand by your line employees and listen to them doing their work. Interact with them for a day without finding a single fault. Simply pay attention to who they are, what they do and what their goals in life are. By doing so, you will be able to help those who help you reach their personal goals and that connection will create a powerful bond that will make them work harder for you as their work is now fueled by belief.
SmallBizLady: How do you hire the right people?
Pejman Ghadimi: Hiring amazing people can be tricky but not impossible. Most hire based on a resume or skill-set, and I simply do the opposite. I don’t even look at the resume or past experience. Instead I focus on the level of awareness someone has and their perspective of life. As philosophical as this may sound, it helps hire people with a common set of values and beliefs rather than people who want a job or career. While those individuals are also good, what they do is trade their time for your money. On the other hand, those with common beliefs trade their energy and mindset for fulfillment and end up working much harder than anyone whose motivation is monetary.
SmallBizLady: What are the rewards of putting people first?
Pejman Ghadimi: By putting people first, you are creating a following of resources. When people owe their success to you, they tend to become loyal and want to always return the favor. While some deviate from this rule, it holds true for the majority. Regardless that they continue to work under you directly or not, they will always end up working for you. When people work for you because they want to, not because they have to; they tend to work at 80%+ of their capacity and feel socially responsible in helping you achieve your goals. Those who only work for you for money usually do so as they see no other value provided by you or your business for them, and therefore only work as little as they can to give you your money’s worth. This is very common in large organizations as there is a significant disconnect from leaders and followers.
SmallBizLady: How do you deal with difficult people?
Pejman Ghadimi: You listen before you argue. There is no winner in an argument. There are simply two people agreeing to disagree. The best way to get someone to see your point is not to question their belief or values, but rather getting them to question their own. That way over time, curiosity will enable such individuals to understand the other perspective presented. The best way to do so is simply listen and then pose questions such as: “if this holds true then why…” This does not come as confrontation but rather enables you to pose questions that the other person cannot answer. This makes the other person question their own belief or perspective rather than believe you are imposing your ways on them; a powerful coaching method of self-discovery for any small business owner.
SmallBizLady: How do you motivate people to drive amazing results?
Pejman Ghadimi: Money or rewards given in exchange for hard work never make people work their hardest. All you are doing by adding money in the mix is killing creativity and helping narrow someone’s vision on the prize. To truly drive amazing results through people, you have to tap into their belief system by creating value for them and showing them the benefits of being part of something bigger than themselves. Many want to be part of the next big thing but simply don’t think they are worthy of it. If you help others by growing their confidence and entrusting them with more responsibility than they think they are worth, they will tend to work harder and be more focused on the overall results rather than just doing their part and moving on. They ultimately end up accepting their social responsibilities to the project and become people centric like you. This becomes a killer combination for success and even more of a reason why people matter.
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Thanks again for having me on your show.