2Bobs—with David C. Baker and Blair Enns

Blair gives David some homework to identify patterns in the principals of creative practices who are successful and have that "je ne sais quoi." LINKS 2Bobs Episode 28 - "Positioning Cheats" Start With Why by Simon Sinek "Top 10 Podcasts Agency Owners Listen To" by Daniel de la Cruz Crucial Conversations - Tools for Talking When Stakes Are High by Kerry Patterson, Joseph Grenny, Ron McMillan, and Al Switzler TRANSCRIPT DAVID C. BAKER: Blair today, we are going to catch up with the rest of the world. I can't even say that with a straight face. We're only 80 years, 90 years behind. We're going to talk about the X-Factor. Okay. And the first time that phrase was used was in 1930, and we're just now getting ready to talk about it. BLAIR ENNS: You've actually done homework. That's not fair. DAVID: Well, a little bit. BLAIR: You went and looked up the first use of the word X-Factor... But hold on - you have to explain who used it. What was the context? DAVID: Well, it was like in the urban dictionary, so it's totally unreferenced, it's just somebody's idea of when it was first used. I probably shouldn't even brought that up. But the phrase that popped up a lot when I was researching the X-Factor 'cause you really wanted to talk about this and I'm intrigued too. It's the "je ne sais quoi" which means, "I do not know more." Have you heard that phrase? BLAIR: Yeah, "je ne sais quoi." I always thought it just meant ... And I should know because I'm Canadian. It's one of our official languages. I always it meant, I don't know. So it's, I do not know more. DAVID: I do not know more, it's a French phrase "je ne sais quoi." In other words, there's this X-Factor. I don't know more. There's just something about them. There's this X-Factor about them. It was pretty interesting. We're going to talk about principals that exhibit this X-Factor. BLAIR: Principles, the people: ...P-A-L-S. DAVID: Yeah, right. BLAIR: Not ...P-L-E-S. DAVID: I never use the other word anymore 'cause I'm so used to using principals ...A-L-S. BLAIR: So principals of creative practices who are successful, who have this "je ne sais quoi," this X-Factor of success right? DAVID: Yeah. You really enjoyed saying that with such a great accent didn't you. So you gave me homework. BLAIR: Yes. DAVID: Here's what you said to me: think of one recent client - this presumes I even have clients, right? But think of one recent client who is very successful, what three things come to mind about that person? So I dutifully answered my questions here just following the script. And then you said, "Now do it for two or three more clients." And so I did that. Now what do you want me to do with this? BLAIR: I want to talk about the patterns. If you've done it for three or four clients, when you think about the attributes of that person, how common are those attributes across those three or four people? DAVID: They were just surprisingly common, and I hadn't ever really thought about it quite like this. But I almost felt like I was wasting my time as I extrapolated to others, because they all came up about the same. Maybe the order of the three things is different from principal to principle but the same ones kept coming up. Did you do the same thing? BLAIR: Yeah and I thought of a couple of people and then I just kind of thought of a group of people and made my list even a little bit longer. So I've got six things, but I would say those six things, they all roll up into one word. So if you had to take all of those different attributes that you've identified of these successful agency principals, and you had to put them all under the banner of one word, what would that one word be? DAVID: So I popped back and forth between these two. But I think the one word would be confident. BLAIR: Yeah, me too. DAVID: Really? The same word? OK. BLAIR: Yeah. So the X-Factor is confidence. But I think we'll get into this and maybe a little bit later on, we'll talk about some kind of big picture ideas around confidence and the subject of overconfidence and how important confidence is. Did you write down different manifestations of confidence or different forms of confidence? What's on your list? DAVID: The early form of confidence would be just starting the business, like, "I can do this." That's one. Another where it seems to show up a lot is just in sales or prospect conversations and I've even actually listened to them and then of course, most of the time I haven't, they're just reporting to me what the conversation was. Then that's where it probably strikes me the most is just this confidence, even when they don't have a lot of experience in the promises that they are making to a prospect. You and I have probably done this in our own practices years ago too. BLAIR: Oh yeah. DAVID: You get on the phone on the way back to the office and you're saying you will not believe what I just promised we could do? BLAIR: Yeah. DAVID: That's where it seems to show up. BLAIR: Well, I think some of th

Blair interviews David on what each of the three levels of success in running a creative firm looks like. Links 2Bobs Episode 39 - "Replacing Presentations With Conversations" The Win Without Pitching Manifesto, by Blair Enns The Business of Expertise: How Entrepreneurial Experts Convert Insight to Impact + Wealth, by David C. Baker Built to Sell: Creating a Business That Can Thrive Without You,by John Warrillow Pricing Creativity: A Guide to Profit Beyond the Billable Hour, by Blair Enns 2Bobs Episode 31 - "Mastering the Value Conversation" TRANSCRIPT BLAIR ENNS: David, it's been a while. DAVID C. BAKER: Has it? I haven't missed you all that much. Have you missed me? BLAIR: Since we've last recorded a podcast, I was listening to one that aired recently and it was talking about my first book is in its fourth printing. It's now going into its fifth printing and I realized that it just aired and we recorded that over a year ago. So if Marcus is digging into a backlog that far, that means we haven't been together for a while. DAVID: Yeah. And it's scary too because imagine how much our thinking has changed in a year? 'Cause you were wrong about so many things. BLAIR: That's an old joke, you need new material. DAVID: Okay, sorry. BLAIR: So since we've last recorded a podcast, I know they keep airing because we've got all this in the can, but you and I did an event in London and then we came home and then you and your wife came up to Kaslo and we celebrated. I was just looking yesterday at a photo of your wife and my wife in a bear den together on her birthday. DAVID: Right, I didn't want to go in it, it's why I took the picture. BLAIR: You're too smart. I took it from inside the bear den, you were outside. DAVID: Right. BLAIR: And then you went to Chile on vacation and then you've probably been in some other places. DAVID: Yes, I have. I'm kind of off the road right now. I head back out of the country on Friday but I've been back trying to get our 61 acre farm livable. So just a few minutes ago, if you'd seen a picture of me, I would have been covered in white from head to toe because I am still trying to figure out how to use a paint sprayer and I realized I have a lot of expertise to develop yet. BLAIR: That's why on a hike I was carrying the bear spray. Okay, so it's been a while since we talked. Today we're going to talk, I want to call it good, better, best but it's really the three levels of success in running a creative firm and I think you've broken it down into the categories of starting, existing and thriving. And you sent me an entire spreadsheet to help navigate this conversation. Things like utilization, positioning, financial, marketing, etc. All of these different things that should be true or should be happening or you should be aiming for at these three different levels of success. Do you want to just take a minute and talk about those three levels of success? Are there lines that delineate between starting and existing and existing and thriving? Well, I think there are. We'll find out I guess, right? But I tend to think in triads. And so as I'm getting a question from a client, I'll sometimes just play this mental game, are they starting out or are they existing or are they thriving? And there seem to be these three different categories. And then you can expand that and say, "Okay, what about financial performance? What about how they think about service offerings or how they think about positioning and how they think about management?" And so I think it's useful to think in these categories because it's not as if a single firm is all in the existing, the middle category. They might spread across different ones and just gives us an eye opening into what our world looks like from the outside. DAVID: I think it'll be kind of interesting to talk about. But you're probably going to let me know how interesting this is or not. If you rush me through these, that'll be a sign that it's not that interesting. BLAIR: Well, let's just see. Let's start with utilization which is the first thing on your list. DAVID: Right. 'Cause such an exciting word, right? Utilization. BLAIR: Yeah. So I'll just have a little nap here while you talk about utilization. DAVID: Like I said to you one day, I'm pre-interested. Okay, so starting would be subsidizing clients and the typical firm in a developed country is charging and getting paid for 42% of their time and they should be getting paid for 60% of their time. So most firms are in this starting category and they never really get out of it. It's more of a typical category. So there's some significant degree of underpricing and/or overservicing. And that's the first one, subsidizing clients. And then hopefully, we get to the point where we get paid for everything we're doing, that's the middle category of existing. And then thriving is package pricing where we're applying what you would call value pricing. Where there's very little corelation between what we're getting

David re-reads the 2nd chapter of Blair's first book, leading to a discussion about how sales people have to choose between either presenting to clients or being present to them. TRANSCRIPT DAVID C. BAKER: Blair, we are going to talk today about replacing presentations with conversations. BLAIR ENNS: The second proclamation. DAVID: Yeah, it's actually the second chapter in your book, which I'm holding right now in my grimy little hands. The book, it's black with red, looks like foil to make it look expensive, so you could charge an extra couple bucks for it probably. It says Win Without Pitching Manifesto, and the second chapter is about replacing presentations with conversations, but I think if you would let me, I'd like to make a public confession before we get into this. BLAIR: Sure. DAVID: Your book actually sells better than mine, and I want you to know that that pisses me off. BLAIR: I read a great quote the other day, maybe it was Gore Vidal who said, "Every time a friend succeeds, a little part of me dies." DAVID: I don't know if this was the third or fourth printing, but since we published the book, we got these three skids of your books. Not only do I hate the fact that your book has sold better than my last book, but I have to haul these skids of your book like for punishment, to remind me constantly that they're selling. BLAIR: That's what you get for moonlighting as my publisher. DAVID: Yeah, instead of focusing on what I should be doing, yeah. BLAIR: The fourth printing should arrive any day now, it's larger than all the other ones. Can I just keep bragging here? I'm surprised it's been, well I think it's somewhere around seven years, and sales just keep going up, I can't explain it. DAVID: I'm more surprised than anybody, because I've read it and I know you. The idea is replacing presentations with conversations, and actually I read through chapter two again, it was actually fun to read that part of the book again. You talk a lot about avoiding the big reveal, and the first thing I could think of was several episodes of Mad Men where they have the single pitch board on an easel in the conference room and it's covered, and when they say "big reveal", they mean big reveal, they lift this thing up and there's this tension in the room. You talk about the fact that we're addicted to that. I'm not sure that people would admit that they're addicted to that, can you talk more about that first, to start us off? BLAIR: Some people might listen to that and think, "Well, I'm not addicted to that," but I think you and I probably have different definitions of creativity. You might have kind of a broader look at what it means to be creative, and I take my cues from Mihaly Csikszentmihalyi, who wrote the book Flow, and he studies happiness and creativity. He says creativity is the ability to see, the ability to bring kind of a new perspective to a problem. It's not the ability to write or draw, he refers to that as "personal creativity". BLAIR: Creative people who can look at things differently, they just see things differently, that's kind of to me the hallmark of creativity, one of the things that goes hand in hand with being creative is the ability to think on your feet, so these two things, for reasons I don't fully understand, they're tied to each other. When somebody has this really strong ability to kind of bring a fresh perspective to a problem, they also have a really strong ability to go with the flow and deal with whatever kind of objections are thrown at them. If your strength is standing in front of a room, saying something, hearing an objection, and then having to react to it, and then kind of sell in the situation or recover from a situation, then you are going to look for as many situations like that that you can create. BLAIR: I'll give you a great example of a friend and a client from many years ago, creative director at a small design firm, and he was presenting a new identity to a consulting firm. He does the big reveal, and it's very quiet, and then he's a little bit nervous because it's so quiet, and he says, "What do you think?" One of them says, "Well interesting, I notice you've changed our name from XYZ Consulting to XYZ Consultants." It was just a mistake, an error on his part, and he responded immediately. He said, "Exactly, because consulting, that's what you do, consultants, that's who you are." They bought it, so they changed the name because he just responded in the moment. BLAIR: Creative people love being in that situation of presenting, having to deal with an objection, and then coming through it, because the euphoria is profound, it's huge. If that's who you are, if that's your strength, commanding a room, having to dance, having to respond to objections, et cetera, not knowing what's going to happen next, then you will create as many situations as possible where you get to do that, and the whole time you will tell yourself and tell others and tell me and tell you, "No no

There are seven patterns that almost all principals are guilty of. When David and Blair point them out, it leads their clients to say, "you must have hidden cameras in my office!"

Blair leads a discussion on how clients tend to take mental shortcuts in making business decisions, and how we can nudge clients without manipulating them to make a decision that is in their best interest. Links Rory Sutherland Influence: The Psychology of Persuasion and Pre-Suasion: A Revolutionary Way to Influence and Persuade by Robert Cialdini Nudge: Improving Decisions About Health, Wealth, and Happiness by Richard Thaler and Cass Sunstein "The Dark Arts of Leveraging Cognitive Biases" by Blair Enns Thinking, Fast and Slow by Daniel Kahneman Predictably Irrational by Dan Ariely Richard Feynman Dunning-Kruger effect Pricing Creativity: A Guide to Profit Beyond the Billable Hour by Blair Enns "Pricing Creativity" 2Bobs episode

David and Blair compare each other's competitiveness, and then offer some specific ways principals can actually collaborate with their competitors as a part of building beneficial business relationships. TRANSCRIPT BLAIR: David, today we're going to talk about how to crush your competition, is that right? DAVID: Instantly I got very excited about the concept, that's really not what we're going to talk about, but I love that idea. Oh my God, I'm just too competitive, but that's actually the opposite of what we're going to talk about I think, unless you want to switch it at the last minute. BLAIR: No, I was with a bunch of guys the other night, and had this little men's night retreat thing, and maybe more than half of them were entrepreneurs. One guy was winding down a business, and he was saying, "I'm not sure if I'm competitive enough to be in business." I didn't say anything, but I thought, I suppose that's vital for you to be competitive in your nature to succeed in business, would you agree with that? DAVID: Yes, I would, but there's something wrapped around competitiveness that is just as important to me, and that's risk-taking. BLAIR: Yeah. DAVID: It does seem like the two of those are related, that's why I quit doing a few things outside of work, because I realized I was not as competitive as some of the young fools that were willing to sacrifice their body, and I wasn't. It's not that my body is so precious, it shouldn't be sacrificed, it was more I was allergic to the pain. Yeah, there's something about competitiveness and risk-taking yeah, for sure. I'm competitive, do you think of yourself as competitive? BLAIR: I've measured my competitiveness and your competitiveness, and you're more competitive than I am. I'm as competitive as the average person, but the makeup of that competitiveness is a little bit skewed. You can break down competitiveness into different forms, so I think of myself as average competitiveness. DAVID: Okay, this is more about how do we tame or tamp down some of our competitiveness for our advantage, and for the advantage of the world really. BLAIR: You really want to talk about this idea of collaborating with your competitors, is that correct? DAVID: Right, yeah, and it's something I've learned in my own business life, but I've also tried to coach my clients to do it as well. It's been really interesting, it's a concept that strikes us like, did he really just say you should be more collaborative with your competitors, or did I mishear him? No, that's really what I mean. BLAIR: Okay, so we think of being in business just like my friend said the other night, we think of it as business is highly competitive, and we need to be cutthroat, and we need to always have an eye on our competition. We're trying to best them, I'm fond of saying that positioning is an act of relativity. You position relative to your competition, and in endeavoring to position your firm against your competition, you're trying to kill them. BLAIR: Now that's an overstatement, but that's the prevailing view, right? The competitors are there, people that ... It's your job to beat, it's your job to win against them, and you want to fly in the face of that a little bit, so where did this idea come from? DAVID: Well it's been rooted really in 20 plus years. I did something a little crazy back in the late 90s. I wanted to start an event, and that was obvious to me, I wanted to start an event. Okay, so what kind of an event would it be? Well it needs to be an event that's going to attract a lot of people. How do we do that? Well, the content has to be fantastic, it's like okay, then I just stopped in my tracks, because I'm thinking, well if the content's going to be great, then I've got to invite a lot of my competitors there. DAVID: We don't see eye to eye on everything, but I need to have them there, because they're very smart. People are going to come and want to hear from them as well, like what kind of a stupid conference would it be where I'm the only one speaking? That's not a conference, that's like your own personal platform. I was faced with a decision, do I really want to give my competitors a platform? DAVID: I was nervous about it, other people were a lot more nervous about it than I was, they thought I was crazy to be doing that. I thought, this is a worthwhile experiment, and maybe there's some value in being the person who organizes the conference, and does the programming for it. There turned out to be that value, but it was a wonderful experience. It opened up my eyes entirely to the fact that I don't have to make somebody else lose in order for me to win. DAVID: That I can let my guard down, and it actually translated into the way I run events now. People come to an event for the first time, and they're surprised that within about an hour, an hour and a half of the start of the event, people are starting to share stuff that they would not have thought they'd see themselves sharing at the beginnin

Blair and David come up with descriptive words that help clarify each of the four parts of what David calls the "pantheon" for new business: positioning, lead generation, sales, and pricing. Pricing Creativity: A Guide to Profit Beyond the Billable Hour Mastering the Value Conversation podcast episode

David and Blair explore the big topic of personality assessment tools that can help firms "get the right people on the bus." Not Your Typical Personality Types →

Blair and David dive into a discussion on ownership structures, looking at the results of a survey that David did recently about partnerships.

Listeners on Twitter wanted to know what clients actually want from creative firms, so David makes a list based on his experience of what good clients want, while Blair's reaction is "who cares what clients want... all they wanted was a 'faster horse.'"

David gets Blair to expound on his statement that "the value conversation is where value pricing theory goes to die," and how crucial that conversation is within the sales framework he lays out in his new book, "Pricing Creativity: A Guide to Profit Beyond the Billable Hour."

David and Blair take a stab at answering the complicated question of what success looks like for each of them personally, as well as what it means for their clients.

Blair and David try to wind each other up by going through a list of phrases they hear from their clients way too often.

David is bothered by the notion of helping people cheat, especially at positioning. So Blair discusses 10 ways firms could succeed even if they either aren't ready or don't believe in the idea of tight positioning. You'll feel dirty.

Expertise, selling, marketing, entrepreneurship, branding, positioning, and consultant. Blair and David do their best to come up with definitions for terms that they use regularly with clients.

Blair revisits David's new book, "The Business of Expertise: How Entrepreneurial Experts Convert Insight to Impact + Wealth" in front of a live audience in London, who get to ask their own questions.

Blair talks about his new book, "Pricing Creativity: A Guide to Profit Beyond the Billable Hour," and the process it took to write it. David gets him to share three of the main rules laid out in the book that firms should apply in order to see significant increases in profit.

David and Blair each share some goals that they have for their clients and themselves for the upcoming year, which turns into somewhat of a therapy session.

Blair and David discuss why, when, and how principals sell their firms, and Blair reveals he is skeptical about selling his own firm.

David picks Blair's brain about new business compensation, and what principals need to consider in finding their firm's place on the spectrum between full commission and salary with no incentives.

Blair has some questions this week and David has answers. The topic is profit - what it is and the targets firms should be setting.

David offers to help Blair remember all the times he's been wrong over the past couple decades. Then Blair says he'll be happy to reveal all of the places he's wrong now but doesn't even know it yet.

David reveals some of the science behind the extensive research he has done over the past couple decades to develop a key part of his Total Business Review. Blair asks him to explain the three roles principals cannot let go of, along with the three roles they should give up first if they want their firms to really thrive.

Blair revisits David's new book, interviewing him on the two chapters that cover the important topic of positioning: "Distinguishing Between Vertical and Horizontal Expertise," and "Principles for the Less Exchangeable Positioning of Expertise."

David and Blair discuss a list of words Blair came up with that you should avoid to keep you out of trouble and in control of the buy-sell relationship.

Blair needs a vacation. And David is blown away by how little time principals take off.

David asks Blair to describe his work and his passion for the creative entrepreneurial community, and they discuss how where he lives has such a huge impact on what he does.

The issue of how principals manage their employees continues to pop up for David year after year, and Blair is worried that he might have this problem in his own firm.

Blair restrains himself from going off on a rant about who his clients choose to learn from.

Blair interviews David about who he is and why people should pay attention to what he has to say - if they should at all...

Blair lays out a year-long experiment where he significantly increased his writing and online publishing commitment.

David Baker wrote a book! And Blair asks him about his authoring process, publishing, and the book's topic.

David and Blair list good and bad things that can happen when the principal steps away from their creative firm for a period of time, which is based on David's blog post on the matter.

Blair revisits the first piece of thought leadership he ever wrote, taking a look at why firms may or may not do for themselves what they do for their clients.

Blair questions David on an article he wrote about identifying the risks on either side of the road and navigating a path between both extremes.

Blair does his best to reform David's skepticism of sales, discussing what works well and what fails miserably in the sales process.

What keeps you up at night? Blair interviews David about the five most common fears that he has seen in the consulting work he has done with over 900 firms.

David and Blair discuss how the nature of entrepreneurship is changing and what the new entrepreneur is facing today.

Do you have trouble talking about money with clients? David makes seven common statements about money and Blair states whether they are true or false and why.

David interviews Blair about the art of effectively communicating with clients and coworkers.

David and Blair make a list of the common mistakes that people make in trying to portray themselves as experts.