Stefan and Dan Sullivan discuss The Engagement Multiplier Program® and the impact it has had on Strategic Coach after a year on the program.
In this episode, you will discover how and why Engagement Multiplier is designed specifically for entrepreneurial businesses, holds your team together so you can create a self-multiplying company, can turn your vision for your business into reality, provide the competitive edge in your tender process, and ultimately make you a better business owner.
You will also learn how you can create Leaders of your Engaged Organization (LEOs) – a self-resourced, self-expanding, self-developing teamwork that raises engagement in your business, develops new leadership capability and maximizes the skillset of your team.
Stefan: Hello there. This is Stefan Wissenbach, founder of Engagement Multiplier and I’m in the studio again here with Dan Sullivan, founder of Strategic Coach. We’re here to talk about the Engagement Multiplier Program and what’s happened after a year of progress. It’s now a year since the program was launched and Strategic Coach was the first company to join the program.I’ve just completed four survey cycles and just heading into the fifth. We have a tremendous amount of data now as an organization on what happens when entrepreneurs embrace engagement and ask for their companies to participate in the engagement multiplier program. Looking back over a year, Dan it’s great to be sat here. Twelve months in and we’ve had some wonderful conversations about engagement. What strikes you as the biggest impact being on the Engagement Multiplier Program has had?
Dan: Well today Stefan, it’s interesting because just before our podcast, you brought in the data for the other companies which we didn’t know. Today is the first time that I actually knew what the progress rates were for the other companies. Just talking about our own experience which I think totally is being experienced with all the other companies, two big things just in terms of the scoring because that’s the first place you look, is there actually a jump in the scoring?
One is that we had this really interesting participation rate. The first time we did it, we got a really good participation rate. We were 83%, which I thought was fantastic right out of the gate. Then the second quarter, we came in at 69%. We dropped 13-14 points. It was just a wakeup call that said almost anything that Dan and Babs, my partner for those who are listening that we’re the owners of the company. For push on, you’re going to get a first initial very positive effect and then there’s a drop off the next time you do it. I said, “Wait a minute. Wait a minute. This is forever.” They didn’t know it was forever. We did a really thorough job talking to all the managers in the company as they’re talked about in the survey. We call them team leaders and we said, “Look this is really serious business. This is going to be a permanent structure of our life here in Strategic Coach.”
Every quarter we’re going to do this. We want you to take special pains to make sure that everybody participates. Of course, we don’t know who participates because it’s all anonymous but you can talk to people. Everybody got to talk to and it would jump from 69% to 97%. We held that. Third survey 97%, fourth survey 97%. You know, I don’t know if we’re going to get higher than 97% because some people are on free days and their free days just happen to correspond when the survey’s there. I’m really just delighted with the participation rate and then the actual score which is the composite score of every single person, the 97% who I use the word voted. They basically voted on the engagement environment of Strategic Coach. First time we did it, we were at 72%, then we went to 79%, then we went to 82% and the last time we came in right at 89.5%.
That was just shy of the 90% mark. That is not so much a result of our pushing it. Babs and I are pushing it or promoting it but it’s actually the emergence of an entire team in strategic coach which is called the LEO Team, Leaders of Engaged Organization which was totally self-created by team leaders and team members in coach. It operates completely on its own. It involves right now about 35 out of the 120 members and we only know about it after they’ve had their meetings and they’ve identified what they’re going to work on each quarter. There’s three big projects they’re going to work on between quarters. There’s this entirely new leadership center inside Strategic Coach that we didn’t initiate and carries independently of us but we’re seeing enormous impact. There’s two impacts in particular as we go along here in this podcast I’d like to talk about because they’ve made a tremendous difference.
I think they correspond a lot to what the feedback that you’re getting from the other companies.
Stefan: Absolutely. I’ll talk about the progression that we’ve seen in just a moment but just picking on that theme earlier, we were talking about the wonderful subject of having a self-multiplying company and something that you said to me which I think would be really useful for people listening to this podcast is how you’re feeling that the engagement multiplier program is now the glue that holds the team together and enables the creation of a self-multiplying company. Would you mind just touching on that sir that the listeners can hear what we discussed earlier?
Dan: One of the things I’ve noticed in my own life and of course I’ve really been living with more than 6000 other entrepreneurs over the last 40 years and having an inside view and how they live their lives as entrepreneurs. There’s a lot of anxiety and pain that you have as an entrepreneur that you don’t even recognize that you have until it goes away.
One of the things I was telling you when I was debriefing on the experience of the first year is that there’s a lot of new things that I’m thinking as a result of the engagement multiplier but one of the big things is equally important is the things that I’m no longer thinking about. One of them is if anything happened to Babs and me, what would hold the company together? Within this past quarter between the third and fourth survey, I just got the feeling it wouldn’t matter because the engagement multiplier will hold everything together. It’s now a habit inside the company. Everybody has the habit of participating in the company and everybody has the habit of talking about the results as the basis of improvements during each quarter.
To a certain extent, I have a self-managing company as a result of the engagement multiplier but now we’re starting to see signs that it’s actually a self-multiplying company. To me that’s really, really exciting. I think if you combined every fantasy that every entrepreneur had about what their company could do in the future, I have to tell you if you put the word “self-multiplying company” down, it fulfills about 95% of their biggest confidence needs and their biggest skill needs would be that the company can multiply itself.
Stefan: Absolutely. We spoke didn’t we about one of the things that often means that entrepreneurs wake up in the early hours of the morning and worry about is that the issues tend to relate back to engagement and entrepreneurs tend to by definition be visionaries that can see opportunities and ways to disrupt markets or create new products and services. That’s a wonderful gift but it’s very hard to follow through on turning those visions into realities if you don’t have an engaged team.
Dan: Stefan, one of the things that I think has been a real discovery on your part is the sudden emergence of the concept of engagement in the world. I have this phrase that your eyes only see and your ears only hear what your brain is looking for. Remember we started the whole process about two years ago that your online future was really going to be centered mainly on a mindset scorecard that actually measured engagement. Since then, you’ve just been discovering enormously interesting things that are happening in the world at large around this one subject of engagement because it’s profoundly bigger here right now than it was a year ago.
Stefan: We’ve just begun some digital marketing as we really seek to rapidly multiply and scale the impact that this business has and one of the things that astonish me was if you go back 18 months, they were somewhere in the region of about 10,000 searches a month online on this topic. A couple of months ago, that peaked to over a million a month.
The world’s really waking up to this topic. I was talking to an entrepreneur in the UK just the other week who has one of his businesses is a call center with several hundred employees that’s rapidly growing at the moment. He plans to recruit another 200 people over the next three to six months. He’s going to engage business that’s growing and he tenders for some pretty large contracts with major organizations who are using his call center to deal with product fulfillment or whatever it might be.
He said to me just the other week, it’s a multimillion contract and the first question they asked me was how do you deal with engagement? This is a client who is just about to entrust an entrepreneur and a business with their business and they want to know about engagement. Really made me realizing that when you get clients starting to want to know how companies are dealing with it, it’s a big deal. As an entrepreneur, you better be ready for those questions because it’s becoming more and more of a topic and if you don’t have a system for measuring and improving engagement and creating an engaged organization, and your competitors do then that will keep you up at night.
Dan: One of the things that’s really interesting to me is your priority rate from the beginning, this was only for entrepreneurial companies. In other words, if you’re going to measure the engagement of the owners, you have to have an organization that actually has a visible active present owner. Can you talk about your greater confidence in that decision rate at the beginning because everybody when they come through, and world market place they begin thinking IPOs and they begin thinking go to the stock market. Naturally, it’s going to be large corporations.
I think your discovery in that there’s an enormous transformative power about the fact that you have zeroed in just on those organizations who actually have an owner.
Stefan: Yeah, absolutely. Let’s be clear. An element of this is very selfish. I’m passionate about what we do and how effective it is. I only want companies on the program where they can make the program work. Otherwise it doesn’t reflect very well on us. If companies are subscribing for the program and they’re not going to work, we don’t really want them to have the product. One of the things that we realized very quickly was that entrepreneurial business have that agility that is so lacking in large corporations.
We measure very simply and effectively once every 90 days. It takes less than 10 minutes. There’s tremendous insight which means that an entrepreneurially minded organization with an identifiable owner has the agility then to be able to take action based on that insight whereas in the big corporations, normally you need six months worth of committee meetings in order to get a decision rate.
The other problem is that in our experience, team members want to rally behind an owner. If the average tenure and in the UK, the average tenure of a Corporate CEO is around six years. Everyone knows that you maybe a great guy he’s probably thinking about his next move and all the big organizations realize the power of engagement and they chuck millions of dollars of engagement programs because it’s big news if they can improve engagement. The fundamental problem is that all your employees know that the managers and the leaders are probably CV building and ready to move on and so is the CEO.
It’s much harder. My view in how you create an engaged organization is a very personal one on networks for entrepreneurial businesses. I’m sure there are other engagement programs that are probably more suited to the corporate environment. That’s not us because we fundamentally believe that you have to first of all have a purpose that connects everybody. The owner has to be responsible for sharing that purpose. Then you bring leaders on board and then employees follow but it has to start from the top. If you don’t have an engaged owner, you really file at the first hurdle.
I was talking earlier on about the statistics. It’s interesting 29% of the companies, we were at year end and we were just looking at all of the performance stats, and 29% of the companies score engaged in the first survey.
Dan: Can you just explain the levels because there’s numbers attached to these but there’s actually four different zones that you have and how you can be judged.
Stefan: I talk about them in terms of elements and the crucial elements and the only elements that matter are the purpose, the owners, the leaders and the employees. You absolutely have to start with a purpose and then you unify owners, leaders and employees around that purpose. I write about this extensively in my book, the engaged organization. When you do that, what happens is that you create an energy and electricity within the organization but then spreads outwards.
Engaged customers are a byproduct of those elements working together. At Engagement Multiplier, what we do is we measure how the elements score out of four organizational states from dysfunctional, through defragmented, through to successful, through to engaged. It’s really easy for team members to do this because it’s a bit like, “I don’t want to keep it, not oversimplify.” It would be like pin the tail on the donkey.
We give a description of what each of those states looks like. It’s very easy for anyone to say, “Yes that’s us,” or “That’s not us.” They can position where the organization is. Then we also ask them to measure how engaged they think the customers are against those four states. Unlike a lot of engagement programs that focus on how you can have more engaged customers, that’s a mistake to do that. You actually should focus on letting the organization run internally first and then the engagement ripples out.
The purpose has turned out to be as we expected but with the statistics. Looking back every year, such a complete game changer. Twenty-six percent of businesses score engaged with their purpose in the first survey. This is across every company on their program. By survey too, that jumps to 35% of business growing engaged. By survey three, there’s a massive jump 75%.
That’s because a purpose is being defined, discussed with the team, it’s written for the team, it’s not written for the customers. The team identify with it. Owners are involved in communication of that. Very quickly, as that starts to happen, you can’t help but see a lift in engagement. That correspondingly is mirrored in the fact that we’ve seen that 29% of companies joining the program score engaged in the first survey. Less than a third.
That then jumps to 45% by the second survey and then it’s just over 80% by the time the third survey comes. We’re not doing anything other than providing the structure and the framework that enables the company to measure how engaged they are every 90 days. Take account of the wonderful feedback they get from the team, take little corrective actions, put things in place as you’ve done with your LEO’s and then re-measure them, see did it work?
Dan: As I say, I’ve been through this right from the very first mention of the engagement platform. Here’s the question I have for you. You’re a very confident guy and you’re a big vision guy and you have been over 10 years that I’ve known you. It’s one thing I just wanted to say to all the listeners.
If you had seen the financial investment and the sheer courage that was required to get this to the stage where we could actually launch it and you followed Stefan around for a couple years and you watched the really, really scary points, you would be utterly, utterly clear why so few people on the planet actually want to become entrepreneurs because I was involved with it but it wasn’t my house. It was my car that was on the line here.
The thing I’d like to ask you because we did launch a year ago with Coach, you probably had a picture of what might be possible at the end of the first year and now we’re at the end of the first year. What’s the comparison between what you were looking at a year ago and what’s the actual reality now.
Stefan: I totally underestimated the power of teamwork. I had a positive outlook on it. I’ve always believed and I know that you don’t need to pay an expensive consultant, a lot of money to come into your business and borrow your watch to tell you the time.
The answers to how to improve the engagement in your organization, they’re there within the team members that are there. You’ve just got to provide a structure and framework to unlock those. I knew it was going to work but underestimated the extent to which it would work. The scale and quality of the comments that are made by team members anonymously and confidentially every 90 days, are things that they think could be done but they could be personally to improve engagement and the organization could be done. They’re astonishing.
They really are astonishing. They’re not just from the senior figures in the business. In fact, quite the opposite. Some of the brightest and greatest insights are coming from the most junior team members. Seeing how rapidly businesses are improving their engagement score as voted by the employees is not us creating the system where we can make a score look great. The score is the score. The team members are voting it. To be honest, I didn’t expect to see such rapid progression under such a short period of time.
It’s been fabulous and I think it’s just going to continue to get better especially as we continue to grow the companies that are on the platform and start to share insight between organizations like your wonderful idea with LEO’s. I know a number of other companies have now adopted that approach and created their own LEOs to help drive things.
Dan: For those who are just listening to the podcast for the first time, this is the self-created organization that occurred really inside Strategic Coach and it was called leaders of engaged organization. The acronym is LEO but this has just become a huge, huge force with inside the company. It’s self-developing and self-expanding because it’s filled every 90 days by the survey scores.
Everybody in LEO, the vast majority of the comments back so they can actually look at the comments. When I say the vast majority, it would keep you reading for a couple of weeks if you gave them everything so that there’s a high number of LEOs because there’s repetitive statements and everything else. You give them that. I have to tell you, there was an innovation during the last quarter which I think is amazing what it does. It’s anonymous. Everybody gets their own score back and they get the report back and everything else but you and Todd came up with a particular innovation and a very, very small thing but it shows how you can make a really big difference with a small change.
It was that each individual and it can literally happen in a matter of 24 hours or 72 hours because with the automatic platform you now have, the moment that all the scores are in and you’ve reached the deadline for the survey, the report is created and sent back to you. They get what everybody else in the company voted the composites. In our company, basically 97%, you’re talking about 115 people responded and you get two scores. You get how you graded the questions and how you scored the company and then you get how the other 114 in the company did.
You get this comparison between how you’re seeing things and how 114 other people collectively are seeing things. We don’t know the scores of the individuals who are getting that.
Stefan: No, it’s only the individuals that can see that.
Dan: Because it’s anonymous, just like the comments are anonymous and how the score is anonymous. The score that they get back, we don’t know this. I do feel and I have one way of measuring. This is a very, very interesting thing on my part and that is the number of people who were really, really good in the company and who were intelligent and they did their job, you always had a feeling that there wasn’t a connect.
They come in, they do their work and everything else and there was nothing really that you could actually fault them on an operational performance review, you did this, you did this and everything else who handed in the resignations over the last two quarters, while especially in the last quarter. I think the quarter is there’s in fact everybody else’s experience and that’s my experience and there’s such a difference between these two scores. This may not be the place for me. I don’t see myself getting more engaged than I am now and every quarter I’m going to get the same result back.
Maybe I should go some place where I’m more engaged. Usually that’s better. It’s a tense situation. It drags on for a couple of years and you can’t get a handle on it because you don’t have anything tangible to actually put on the table to have a discussion about and because of the engagement multiplier, you don’t even have to know what the number is and you don’t even have to put anything on the table. They see the evidence or the difference between their experience and everybody else’s experience.
These are things that we would never have known at the beginning and I think that my experience is that every quarter from now on, we’re going to come up with discoveries about the psychology of organizations, about the morale or non-morale of organizations that previous to this tool that you’ve put together, there was absolutely no way of getting the handle on.
Stefan: Absolutely. The LEO’s thing is interesting as well because I think the point that’s very relevant for the listeners today is how an organization that’s very engaged like Coach, they’re earning a certain number of leadership roles available. When you have really happy people that love working in the organization that aren’t planning on moving on any time soon then that often means that the only new leadership roles that are going to become available are as the organization expands.
What I think is really neat with the way that you’ve set up the LEO model into Coach is that you provide a mechanism in a way and a structure to create a whole lot of different new leadership roles around engagement.
Dan: The interesting thing is leadership not around existing activities because those are handled. We’ve got our entire leadership team and for a lot of our team they’ve been here for 20 years and they’re going to be here another 20 years. There’s no vacancy in that leadership position.
What the LEO does and because of the information that everybody now has because of the engagement multiplier, new initiatives are being created where you can be a leader tomorrow. You can declare yourself I’m the leader on this project. What’s really interesting is that these are project leaderships. It’s a leadership for something that at the very most is probably going to happen or will have a beginning, a middle and an end within a 90 day period and then you get the person who did it. They get enormous amount of support from the other members in the LEO team.
They have access to other skills that can come in to play and then if they have a really successful one project then they start saying, “Well I’ll take on another project.” This is infinitely open to them. There’s a big smile on your face and I said, “My definition of self-multiplying company as an owner is that amazing things are happening in the company and Babs and I are told about these amazing things after they happen.”
Stefan: Absolutely. It’s a great definition for a self-multiplying organization. Now the LEO idea is wonderful and it’s a great example of a transfer of insight that any other organization can adopt and it creates even more engagement.
Dan: You’re into it as we’ve been building this organization. We’re in our 26th year. The availability of this whole thing and I’m going to just spend a minute here about the changes in me. It’s probably reduced by 50% the number of things that I thought I had to think about before.
I just feel this enormous release of my mind being concerned or attached. Well, how is this going to happen and how we are going to do this and everything else. All of a sudden I said, “I don’t have to worry about it.” Just the natural impact and the influence of the scoring system is going to take care of all of this and I’m not even going to be the one that takes care of it. Somebody else is going to take care of it or somebody else is going to step up and say, “Well there’s a real opportunity for leadership inside the company.”
The other thing is that it’s made me an incredibly better owner. I’ve reflected on this in a previous podcast but I have more proof of it now that I just handle everything differently based on the fact that how I handle it is going to get scored.
Stefan: Absolutely. Every time you show up will be to score.
Dan: Yeah. It’s the closest experience that I’ve had is that there’s an engagement god who watches me. I’m getting scored on this but that’s the way I would want to be anyway as an owner. You have your aspirations of what kind of owner you want to be. It only directs me in the direction that I wanted to go anyway. I get a score every 90 days and I never had that before.
Stefan: It’s been wonderful seeing the progress that coaches made in the other companies have made where it takes bravery to do this. We say it’s entrepreneurs. You’re working yourself up to getting everything scored and everything measured and that can for some people be a little bit intimidating at first but it’s amazing how quickly the energy and the activity transfers from owners through to employees to actually start creating a more engaged organization.
Fundamentally, the evidence shows this in our experience of this is also very much mirrors is that fundamentally people actually want to be engaged. They’re turning up every day. They actually want to be an engaged organization. It’s something that when you provide them with the ability to do that, they tend to respond very, very well to that opportunity.
Dan: One of the claims about the superiority of publicly traded organizations as opposed to privately held organizations was that there’s vastly more measurements in the publicly traded organizations, the stock market being the biggest one. Really good economies, countries with really solid economies that there is an enormous amount of transparency that’s visible to outside investors about what’s going in a publicly traded organization simply because of quarterly reports and they have a board of directors that can fire the CEO.
The quarterly results, they’re getting bad results. Everybody is aware of the scoring system. They say, “Well that’s superior to a privately held corporation,” because we don’t know actually what’s going on inside of a privately held corporation. If you go to an investor and let’s just say we’re a year or two down the road and it’s becoming well known of the power and importance of the engagement multiplier, the investor can say, “Are you in the Engagement Multiplier program?”
They said, “Yes we are.” He says, “Can I see your scores please?” Just by seeing the participation and the engagement, you’ve just probably eliminated about 95% of the concerns or the lack of knowledge that an investor would have about a privately held corporation.
Stefan: It’s incredible data and I still think it’s crazy. I would imagine there are many entrepreneurs listening to this podcast who wouldn’t dream of running their business without getting regular financial statements because they want to see exactly how the numbers stack up, how the sales are stacking up, what the profit is month-to-month, quarter-to-quarter. Yet, people don’t measure how engaged or the engaged health or the emotional health of the organization is seldom measured.
Yet, you won’t need me to tell you this but if the engaged health of the organization starts to dive, normally the financials follow. Where you just measure the financials, the time you that you realize you’ve got to take action is probably a bit late. Whereas if you’re measuring the engaged health of the organization, not only does that tend to be a natural lift when you measure something and you put effort around it, but it enables you to take much earlier corrective action and be much more effective.
Dan: The financial statements are basically a really great measurement about what’s happened in the past but the survey scores that come back from the engagement multiplier are a tremendous predictor of what’s going to be happening in the future.
Stefan: Absolutely. Thank you, Dan. It’s been another energizing podcast and it’s great hearing about the progress that continues to happen at Coach and some wonderful, transferable insight for other businesses that are looking to improve engagement. If any of the listeners are interested in finding out more about engagement multiplier, just go to engagementmultiplier.com and everything you need is there.
We hope to have you joining a community of businesses that are measuring and improving engagement every 90 days. Those businesses being they’re the businesses to run, happier places to be and ultimately self-multiplying organizations.