Stop Chasing Goals: Build a Business That Gets Better with

In this insightful interview, Aaron Trahan explores the concept of performance mindset, the pitfalls of growth obsession, and the importance of systems and focus in leadership. Discover practical tools and mental models to elevate your leadership and business performance.

Guest Links

https://performancemindsetcoaching.co/contact/

What You'll Learn:

→ Why growth mindset isn't enough — the power of PERFORMANCE MINDSET

→ The FOCA Method: How great leaders assess and close their blind spots

→ The Prioritization Doom Loop — and how to escape it for good

→ Why chasing revenue can destroy your business

   ("Revenue is vanity, profit is sanity, but cash is king")

→ Business GPS: Turn your 2-year vision into 90-day wins

→ Goal-driven vs. system-driven organizations — which one actually scales

Transcript

2:15

Aaron, welcome to Productivitree! Thanks for having me. I'm looking forward to this conversation. Let's start with the very basics. What is performance mindset? Yeah, you know, in my senior executive career, I kind of stumbled upon something at least I found interesting. And, you know, we've got to give credit where credit is due. The book mindset by Carol Dweck really helped put the concept of a growth mindset in a fixed mindset kind of in the mainstream. think just about every professional now kind of understands that, but What I was noticing is every time I spoke to a team or a group or was in a room and the concept of growth mindset came up, 99 % of the hands in the room went up claiming to have a growth mindset, right? Like every business professional kind of thinks they have a growth mindset. I've yet to find one individual that's told me, nope, I don't have a growth mindset. I've got a fixed mindset. So then I started asking the question, Well, if all of these business professionals and leaders all have a growth mindset, why are so few of them actually growing? Why are they stuck in the status quo and they're complacent and they're not doing the things required to kind of get uncomfortable and unlock new levels of growth. So that's where I started to really peel the layers of the onion back and came up with what I call the performance mindset. And it's really the next level to a growth mindset. And it's rooted in the belief that, you know, it's great to have a growth mindset of thinking that nothing's fixed. Anything can be developed. You can build skills in your intelligence and your knowledge base. All that's great. But now what I like to talk about is thinking and believing can only take you so far. No work gets done if you simply sit back and think and believe that you can do something. So what a performance mindset is, is really all rooted in the actions. Have you set the clear goal? Have you determined what the outcome is going to be? And are you taking those uncomfortable steps and having a strong bias for action to actually do the work? So it's much more rooted, not so much in the thoughts and beliefs and in the actions of what's actually occurring to make progress towards that stretch goal, towards that next level, towards that, you know, the, that untapped potential that a leader has. And so to summarize all that for you, Santiago is what thinking and believing is to a growth mindset, action and persistence is to a performance mindset. What is one thing that most leaders or more leadership teams thinks that means growth? That it's destroying performance over time. Yeah, you know, I see so many, so many leaders and leadership teams when they think about growth and they think about scaling, it is really shaded by the concept of more, right? When you think about growth and scale, so many leaders start to think we got to do more. We've got to go into more markets, launch new products, open new channels. It's almost kind of disguised as more. And what happens whenever I see teams chasing after growth in the form of more, they start to get spread too thin. Focus is a superpower for every single organization, no matter the industry, no matter the size of the business. Focus is going to be that thing that either determines you achieve what you want to achieve or you fall short. So when leadership teams start chasing more, the focus tends to be fragmented in a lot of different areas. They start to experience what I call priority mismanagement. The teams underneath them start to say, either have too many priorities, everything becomes a priority, or priorities are shifting every single week. So you think about that superpower that every organization has the potential to capture, which is focus. And when leadership teams start going after growth in the form of more, that focus starts to thin out. There's not enough dosage of focus behind the right areas and it's inevitable. Expectations are not met and performance suffers. Beyond going for more, what is a belief you had as a young executive that you thought meant performance or scaling that you now completely disagree with? Yeah, I think, you know, when I was a young executive, when I kind of thought about growth and scale, you know, there was almost kind of like a uh size component of it, right? Is we scaled and we've now reached this certain size. And what I learned the hard way is that not all growth is good. You can go out and grow and get to a big size, but if that growth isn't efficient, and you don't have the right infrastructure to support it, you can actually create more problems for the business than you're generating benefits. I had a mentor who is in the form of a board member tell me one time during one of these especially challenging growth areas where he put it in one sentence that still to this day serves as a reminder and kind of some value that I get to pass along to clients. And he said, never grow faster than your organization's ability to manage it. And so it's not how fast you grow or to what size you grow, it's how efficient that growth is. How high of a quality is that growth? Is it sustainable? Does it create operating leverage? Is it the right type of growth for the right type of business? And so, yeah, that was the big, mystery that got unlocked for me was growth doesn't always mean larger size. It could mean a lot of different things in the form of efficiency and quality of growth and what type of moat you're putting around the business. That's very interesting, Aaron, because when you look at particularly big companies, publicly-traded companies, everything is about volume. Shareholders want more returns. They want higher EPS. They want their money returned as many times as possible. So how can leaders... go back to the board and say like, listen, well, this year we're going to double our sales, but we're going to become very efficient and scale in another direction, not only on the volume slash revenue side. Yeah, I think that kind of leads to a pretty. And this may shock many of your viewers when I or audience when I when I say this and it's you know, revenue may in fact not be your organization's most important metric. And so if you rewind the clock back in 2019, 2020, 2021, you know we were operating in a different environment then right after. COVID, especially when things kind of stabilized and all of a sudden there was a lot of, you know, lot of easy capital to get out in the market. And there was a lot of companies growing very fast. The market was rewarding, fast, top line growth. There's other periods of time, you know, beyond post COVID. But what people realized is, is if you grow very fast, but you're also burning a lot of cash to do that, that may not get That operative word that you said is investors want a return on their investment. Right. They want that ROI. They want the appreciation of the underlying asset. And if you're growing revenue very fastly, but your losses continue to pile up and you're burning, you're burning cash, that just means you're, you're really accelerating the pace to have to go out there and raise more capital, which can be dilutive. to that return on investment that your investors are looking for. So to simplify this, what I have businesses look at is three metrics. And one not really more important than the other, but it's really about the harmony that these things have with each other. So it's revenue growth, profitability growth, and cashflow growth. And so the name of the game is trying to keep these things all dialed in. and very aligned with each other. Because if your revenue is growing very fastly, your profits are not, and you're burning cash, what are you actually doing? All you're doing is if you can't convert that revenue growth into profitability or cash, you're arguably digging your own grave at a faster and faster pace for your organization. And so it kind of goes back to the saying, revenue is vanity, profit is sanity, but cash is king. So if your revenue is not generating profitability and not generating cash, which is the oxygen for the business, that growth may actually be killing you, not helping you. Aaron, you help leaders get better at getting better. You said it before. We all think we have a growth mindset, but we not all of us, we do. When is the moment that you see people moving outside? Is there a key time where you can detect that people has moved out of their fixed mindset or partially growth mindset into their full capability of getting better systematically. Yeah, I look for a couple things, Santiago, and one is, are they viewing the world in the rear view mirror or out of the front windshield? And here's what I mean by that. So for a lot of successful leaders, they're very prideful in what they've achieved, right? They're proud of what's happened in the past, but are they relying too heavily on that? Has their prior success really got in the way of them learning and adapting and evolving to be a more effective leader. Those leaders that look out the front windshield, while yeah, they're still proud of what they've achieved in the past, they operate a bit differently. They're always asking the question, what more am I capable of? What greater potential do I have? What bigger impact can I make in the future? So their viewpoint is focused on what more they can achieve. not what they've already achieved in the past. More specifically to answer your question, I put leaders through what I call a FOCA method, kind of an audit. And FOCA is spelled F-O-C-A. And that's where I try to gauge a leader's willingness or openness around four key areas. Number one, the F stands for feedback. I try to understand and analyze How much constructive feedback is a leader open to receiving? How much is coming in? Are they willing to hear the uncomfortable truth or are they just listening to the things that they want to hear? Second is how open are they to taking ownership of that? Santiago, I'm pretty sure you've seen before where a leader received some constructive feedback and they're immediately defensive. They're like, no, no, no, let's discount that away. You don't understand. No, that's not true. They're kind of defensive. They fight the feedback. The O and the FOCA method is, they willing to take ownership of it? It's not always easy to hear constructive feedback, but the best leaders own it. They say, thank you. They understand that they may not agree with it all, but they are listening to someone else's perception of reality that they had a small role in developing. So are they owning what they're hearing? The third area, which is the C, is their willingness to change. So it's one thing to receive the feedback. It's another thing to own the feedback. The third thing is, they willing to change behaviors based on that feedback? Are they gonna be willing to do things differently in the past, even if it's uncomfortable to do, versus how they've operated before? And back to the performance mindset, that last section, the A, is are they willing to take the actions to change behavior? Will their actions actually change moving forward than how they've acted before? Those four areas will determine whether a leader is even able to improve and become more effective or based on those four areas will determine whether there is no growth ahead for that leader because they're not able to listen to feedback. They won't own it. They won't change. and they're not willing or open to take new actions. What are some of the things that you tried earlier in your coaching career to fix performance and alignment that did not work? Yeah, it's, you try to do a lot, right? It's when you have a lot of tools in the toolkit, you're really trying to help leaders around performance. One of the mistakes that I made before I have adopted kind of the philosophy that I have today was really taking an approach of, an understanding that it's not about me. It's not even about the leader. If it's just one-on-one conversations, Who knows what version of the truth I may be getting? Who knows what part of the story I may not be trying to help? It was an understanding of it's really not up to the leader whether they feel they're improving. It's not up to me as the coach whether I think they're improving. It really is up to the stakeholders around the leader. Those that truly experience a leader's leadership on a day in, day out basis. Are they experiencing the change in behavior and effectiveness that the leaders demonstrating? Those are the people that really determine if the leader is getting better or not. Not the leader, not me, but the stakeholders who experience the leaders leadership. Can you walk us through the core idea behind your business GPS tool? If I'm a CEO staring at this tool, at this worksheet for the first time, um what is actually in it for me? Yeah, so I want to compare this to Google Maps, right? So if your audience was to pull out their phones right now and Google Maps, Apple Maps, whatever map system they use on their phone, the tech company that produced that app has probably spent multi-billions of dollars for that application to work the way that it should. But there's a couple of critical data points it needs to generate the results to get you from the place you're currently at to where you want to go. It has to be able to understand your current location and you have to be very clear on the destination that you want to get to. If your destination is Europe, that's very vague. That could mean millions of different things, right? If your destination, you narrow it down to Switzerland, well, that's a bit more targeted but could still mean a lot of different things. Part of the art and science of getting to where you want to go is being able to diagnose exactly what the destination looks like. And so that's what the business GPS map is all about. We don't go too far out in the future. Where I like to get businesses and leadership teams to focus is not 10 years out, not five years out, but really two years out. That's where we start. It's not too far away, but yet it's far enough to where there can be some vision planning to be put in place. So we get the leadership team to establish and align on where does this business need to be two years from now? What needs to be true? What do we have to achieve? How will we know we've been successful in getting there? What metrics? How do we quantify where we want to be two years from now? And that starts the working backwards exercise. Once we get a leadership team aligned on that, then we go down to the next 12 months. So we take a two-year vision and we now create a kind of a one-year milestone. Where do we have to be in 12 months for this team to feel like we are absolutely on track? We've made the progress that we needed to make that gets us to our two-year vision. We get the team to align on that. Then we break it down again. We now look at six month milestones. So now we're really shrinking the view of the team. We know where we want to be in two years. We know where we have to be in one year to be on track. Now, what must we achieve in the next six months so that we're on track for that one year target? And then we... we wrap that into a quarterly focus plan. So now what is our quarterly priorities over the next 90 days, the next three months that allows us to create base camps to climb the mountain, right? You don't um try to summit the mountain in one pass. You reach these certain base camps. That's all we're doing. We're creating the right milestones that represent the right amount of progress that gets the business where they need to be to stay on track to that two-year vision. When that becomes clear for an organization, they're now able to operate with a whole different level of prioritization, focus and execution because so many businesses don't have clarity on those different milestones, which means they're chasing after shiny objects, priorities are always shifting. and it's very tough to stay on track to where you need to be. Wow, Aaron, you got me thinking about my GPS and my next destinations. uh Goals, destinations are great, but you often say that great businesses are built with great systems. So what are the critical differences between teams or organizations that are goal-driven or organizations that are system-driven? Yeah. And so I'll kind of steal some language from the, uh, the bestselling book, Atomic Habits by James Clear, which is one of my, one of my favorite books on the planet. And he said it better than anybody I've ever heard before where goals help you achieve something one time, right? You've got a goal. That's what you're trying to achieve. It helps you achieve that thing. Systems. help you keep achieving goals over and over and over again. It's a way that you operate. It's a way that you set a target, understand what's required to hit that target, get clear on the milestones, and then create the visibility and trackability around progress towards those milestones. And so it's how a team shows up on a day in, day out basis. It's system driven. It makes behaviors, it makes tracking more predictable. And so I kind of developed this formula, right? It's, you know, every CEO that I talked to wishes there was greater accountability in the organization. He wished more, more of the employees would take ownership to generate progress. But there's a couple of things that have to happen first, right? A system helps you create the clarity and visibility of what needs to be done by when and creates very clear definitions of what success looks like. The second component is measurability. How do we show up and measure progress on a weekly basis? At the end of each week, can your leadership team look at a priority or a goal and say, we are on track, at risk, or off track? Because if it can't be clearly measured, is it really a goal or is it more of an idea, right? Measurability makes it a goal that you can see progress or a lack of progress being made on a weekly basis. Once you have those two things in place, then a leadership team is in position to drive accountability throughout the organization. But if we reverse engineer that, if you don't have visibility and clarity of the goal, it's not able to be easily measured. The question I would have for a leadership team is how in the hell are you going to hold your organization accountable? You can't see it, you can't measure it. What are you holding the team accountable to? And so those are the core components that make accountability a key pillar and drives a system driven approach to viewing the goal, being clear on the goal, measuring the goal, making the right calibrations and holding people accountable. You have another term that I'd you to go through, is prioritization doom loop. What is that? It sounds a place I don't want to be, but uh can you explain us what it is? Yeah, it's more of a journey, right? And every time that I come in and I start helping a leadership team in a business where they know they're not reaching anything close to full potential. Expectations are not being met. just, they're always falling short and performance is not where they want it to be. They, they, they feel that the business is just simply not performing well without fail. This doom loop is. is actively happening in the business. And so let's go to the start of the prioritization doom loop. We've actually already touched about it in this conversation is it really starts with prioritization and how well you're managing your priorities or are you mismanaging your priorities? So let's go through those three scenarios. Is everything a priority? Is priorities always shifting? or are priorities kind of unclear? Nobody knows what the priorities are. Those are all the scenarios that feed prioritization mismanagement. So what happens when priorities are not clear or always moving or everything's a priority? It goes back to that focus, right? So is your focus harnessed behind the right things or is your organization's focus all over the place? So when priorities are being mismanaged, Focus is going to be scattered. Well, what happens when focus is scattered? That's where, that's where they call me. And that's why I have to come in. It's because expectations aren't being met. Performance is weak. And so what's the natural human leadership tendency whenever expectations are falling short and performance is weak? Well, we lock ourselves in a room and we come up with new priorities. How are we going to turn this thing around? How do we? How do we set a new strategy for the business to get performance back on track? Well, with more priorities comes even more priority mismanagement. So the doom loop is spinning from too many priorities to not enough focus, to weak performance, to encourage teams to set new priorities to get things back on track. And it's the doom loop that so many leadership teams just can't seem to get themselves out of. Aaron it's fascinating, your systems are really interesting. Are these exclusive to large organizations? Does this work on a company with five people also, or is just for big boats? I see this across the board, small businesses, medium sized businesses and large businesses. In some cases, small businesses actually have the biggest challenge, right? Because with a five person business, a strong founder, you know, may want to chase after all kinds of things. It's, it's, I see this so frequently in a lot of smaller founder led businesses where They are driving their teams crazy because they're always chasing after the next shiny object, the next feature, new technology they want to incorporate. And so there's a lot of moving pieces, even for a small team. Focus is still a superpower. That doesn't matter whether you're a large organization in the 30 floor tower or you're a startup operating out of a garage. Focus is always going to be the the determining factor, whether you drive to scale and grow the business or you're kind of just spinning your wheels. Focus is going in a lot of different areas and you may feel busy. There's a lot of activity, but you don't see the productivity from those actions. It's not moving the business forward. So yeah, to your question, this is pretty universal. It shows up in small businesses, medium-sized businesses, and even the largest businesses. You work with high performing executives who are often at the age of burnout and stress. They have a lot of responsibility, accountability as well. How does building a system driven business instead of a hero or superhero, super leader driven business change their wellbeing when they adopt your systems? Yeah, it really comes down to one word. And before I say this word, I want your audience to think about, do I feel better when this word is low or do I feel better and healthier and clearer minded when this word is high? And that word is chaos, right? Do you feel like you show up to your office at the beginning of each day, you get sucked up in a tornado and then spit out at the end? Well, When you are mismanaging priorities or have too many priorities or you're saying yes to everything, that creates a lot of chaos. And I've yet to find a high performing leader who just says, you know what? I do better. My team is better. I feel better when there's just chaos all around me. We all want to try to control the chaos. And without systems, that's going to be extraordinarily difficult. When your business is experiencing a tremendous amount of chaos and things are wild, everything's on fire, I like to tell leaders that's just the business's way of screaming out. It needs better prioritization, better systems and better processes to organize the activity. That's all it is. But no body operates better or no, especially the teams underneath them operates better when chaos is hot. And when you don't have systems and you're not clear on prioritization, there's going to be a heck of a lot of chaos. Aaron, can we do five quick answer questions? Yeah, let's do it. Number 1, the most overrated leadership advice you hear. Executive repeat. most overrated leadership advice. Move fast and break things. Well, you just you just went against an entire section of the business world. I love it. Number two. Can I ask you? I sorry, before we go to two, can I ask you why do you want to break things fast? Yeah. Well, the reason I think that's so overrated is because for a lot of the organizations that move fast and break things, they kind of feel like they have to move fast and disrupt to grow and scale. They sometimes break a lot of things that are very, very important. And so all of a sudden the vast majority of their time now has to move to fixing the things they broke and not able to move fast. And so I just like to counter that with saying, Yeah, moving fast could be important, but if you're going 100 miles an hour in the wrong direction, you're just moving further away from where you need to be and what you need to be doing. So I help help teams focus on direction over speed. Direction is much harder to change. You got to think about the Titanic or a big cruise ship, right? It's much easier to dial up or dial down speed than it is to turn around and go the opposite direction. So when I hear a business leader say, we've got to move fast and break things, I'm like, no, not necessarily. Focus on getting in the right direction first. You can always go faster when you're clear on direction, but don't focus on breaking things because you could break something really important that could hurt the business. Hmm. I just made a quick synopsis. have a very good friend of mine, Aaron, that says that the move fast, break things philosophy brings chaos, which is what you say. Not for every organization, but for many of them that are not ready for that pace and they impose that pace, all it brings is chaos and people are getting frustrated and pissed. Question 2. One tool, ritual or template you refuse to work without? For me, it would be OKRs, which stands for Objectives and Key Results. And so when I look at a business, the most important things a business can do is prioritization, communication, focus, execution, accountability. Objectives and Key Results is one tool that checks every single one of those boxes. I can't live without it. Mm-hmm. You hinted it before, but what is your, okay, we have your spiciest take on revenue as a health metric. Yeah, is revenue in most cases can be an overrated metric. And it's, it's, if you focus too much on it, you're missing the point of what revenue is meant to do. Revenue is meant to be able to generate profit for the business. I don't want to invest in many businesses that have revenue, but have no profit to show from it. And from that profit and from that revenue, you need to create oxygen for the business, which is cash flow. And so I think revenue, when it's overly focused on, could be overrated because the focus needs to be more so on is the revenue helping us generate cash and generating profits. Number four, early career iron in one word and current iron in one Early career Aaron was a know-it-all. Current version of Aaron is a learn-it-all. And number five, one daily habit that quietly upgrades a leader's effectiveness. for me, it's meditation. Meditation is a way to clear the mind. I kind of think of it as my meditation practices is the equivalent of a snow globe, right? You get those snow globes around Christmas, you shake it up and you got the snowflakes and all the things kind of floating down. Meditation is the process of allowing all those things to settle, giving you clarity on what's my goal, what's required to achieve my goal. And as a result, what are my top priorities? I think without meditation, you have a lot of chaos. Aaron, let's start wrapping things up. For leaders that have started multiple times, being coached many times, leaders that started to install better systems or systems, and then quietly they drift back into chaos. How can they design? against that. How can they design resilient systems? No systems that at the first time that I'm not consistent or the company has an emergency or an event. They go back to what they were doing. Yeah, I think they need to look at their environment around them and ask themselves around their environment. Another quote from the book, Atomic Habits is, environment is the invisible hand that shapes your behavior. So that scenario you just described to me, there's something lacking there and it's accountability. So every leader needs to look at their environment and say, do I have the right accountability mechanisms around me that can be in the form of a coach, that can be in the form of a team? Is your team telling you what you need to hear or is your team telling you simply what you want to hear? So your environment is going to shape all of those things. And so if you're a leader that implements the systems and slides back, upgrade your environment. How do you have the accountability partners or pieces in place? that will be there to push the alarm button when you start to slide. That can be at a team level, that could be at a mentor, coach, or support level, or it could be both. But when I see that scenario, I see a leader that doesn't have the right accountability mechanisms surrounding them. Aaron, I'm sure that after this masterclass on business performance, leadership, direction, speed, breaking things or not breaking things, a lot of oh audience would love to get in touch with you. How can people reach out to you? How can they work with you? Yeah, two ways. First, let's leverage this beautiful thing called the internet, right? And I would highly recommend let's connect on LinkedIn. I'm always sharing different insights and things that I'm learning to add value to my LinkedIn community. So let's connect there. That's a great way to get a conversation started. To really understand how I'm able to help you as a leader or your business, I highly recommend you go to my website. which is performancemindsetcoaching.co. That's gonna give you a deeper view into what it looks like to work with me, what outcomes you can expect from working with me, and what the process may look like in working with me. And so those two places are gonna be where you get all the information and knowledge you could possibly ask for in terms of what it looks like to get better at getting better. Aaron, thank you so much for, em again, em this conversation with a lot of insights, a lot to think about, a lot of to reflect on systems consistency. And that's one of my takeaways, systems brings consistency and growth. The other one is that sometimes you don't need to run very fast to reach where you need to be. And I'm also taking away the revenue thing. Revenue is a bit of an obsession in many organizations, but there are other vectors, other metrics that can bring more stability and future growth. Errol Crehan, thank you so much for being with us and continue inspiring us with your incredible leadership. Thanks for having me Santiago.