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Michel Falcon:
Welcome to the People-First Culture podcast with me, Michel Falcon, where I share lessons I’ve learned and those of others on how to build a more purposeful business and career. Hey everyone. Welcome to the People-First Culture podcast with Michel. We have a very special guest in the virtual building, Cameron Herold, to talk about company culture. I’m not going to go through your bio right now, Cameron, because it would take too long. I’m going to link that all up in the podcast notes. Short description of how Cameron and I know each other. His last day at 1-800-GOT-JUNK was my first day. We stayed in touch and now it is 2023. That was in 2007.
Cameron Herold:
Yeah, that was 16 years ago. Yeah, we’re older.
Michel Falcon:
We are, aren’t we?
Cameron Herold:
Yeah.
Michel Falcon:
One would hope wiser. Cameron, I’ll get right into it. I first saw company culture be something that was more than just stuff on your wall or in your break room and perks. When did you first learn that company culture could actually drive growth?
Cameron Herold:
1987 I was with a company called College Pro Painters and the founder of College Pro, Greg Clark stood up at a session and he was talking about goals and vision and core purpose, and he said to build an amazing company, it has to be a little bit more than a business, a little bit less than a religion. It has to be in the zone of a cult, and that’s where culture emerges from. And I just realized and we learned how to build a core culture and it had nothing to do with perks. Perks were things you layered on later, but culture was an obsession with core purpose and core values and BHAG and the right people systems and getting rid of the wrong people and just stirring the Kool-Aid.
Michel Falcon:
So you’ve seen it multiple times over not just at College Pro Painters, but also at 1-800-GOT-JUNK, and many other clients that you have advised afterwards. So there’s proof there, whether it’s through companies that you’ve associated yourself with Zappos, Starbucks or whichever brand. Why do some companies still struggle to commit to it?
Cameron Herold:
Well, I think every company’s committed to culture, but in some cases their culture is very beige. Right. Why aren’t they committing to making a better company culture? Right. Why aren’t they committed to actually understand? Because every company out there has a culture, right? It could be a culture of fear, it could be a culture of intimidation, it could be a culture of ambivalence, it could be a culture of kind of whatever. So every company has it, but the thing is, how come they don’t drive towards having an amazing company culture? Why aren’t they trying to be a cult? Because they either don’t understand or they think it’s about perks and they don’t want to have all the extra expenses.
Michel Falcon:
So let’s paint a picture for listeners. How would you describe the culture of Apple?
Cameron Herold:
Well, so without having worked there, I think it’s an obsession to create insanely great products, to challenge the status quo, to give people tools to change the human race. I think it’s very much a kind of work hard and deliver excellence company culture, and it’s a culture of simplicity. Steve Jobs was ruthless around getting rid of waste, whether it was people waste or time waste or money waste. And I think that kind of permeates their whole brand today. The simplicity of their website copy, the simplicity of their stores, the simplicity of their technology, and then also just these insanely great products and we’re willing to pay for that. And then it’s because of that culture we’re willing to pay.
Michel Falcon:
How would you have described the company culture at 1-800-GOT-JUNK when you were part of the leadership team?
Cameron Herold:
Well, we were obsessed with trying to build a globally admired brand that was our BHAG, to build a globally admired brand. So that permeated all of our decisions around what would our call center look and feel like if it was globally admired, what would our branding look and feel like? We were so obsessed with company culture that we brought Simon Sinek in to be on our board of our advisors three years before he did his famous TEDx talk, or even four years before. We were obsessed with core purpose and core values and BHAG and vision in the very early days. So I think it was an obsession with creating this amazing brand and really, really helping people kind of deliver their best, whether it was employees or franchise partners. And we were also obsessed with growing people. It was all about growing their skills and growing their mindset and growing their confidence at all levels of the company.
Michel Falcon:
Was this a true story or folklore, Simon Sinek use to sleep on the couch at the junction?
Cameron Herold:
Well, he used to sleep on my couch as well.
Michel Falcon:
On your couch. On your couch.
Cameron Herold:
Yeah. I’ve made dinner for him. I’m going to see Simon next week at the main five-day TED conference again. Yes, Simon was involved with us at the very early days. He flew out from New York to meet Brian and I. He actually cold called me. He read about us in Fortune Magazine, Fortune Small Business, and he wanted to find out if what he read about was true because he thought our company culture was too good to be true. And when he flew out, he read that I used to inhale Rosemary oil as through a diffuser, so he brought me a rosemary plant the day that he showed up in our office. But yeah, that was way prior. It was four years before he wrote the book. By the way, the whole thing about culture, when I started with Brian in October of 2000 at 1-800-GOT-JUNK, I walked in as employee number 14.
When I left, we had 3,100 employees system-wide. But when I came in, in that first month, I wanted to do three things. I wanted to increase our prices by 40% because we were charging way too low and no one was making money. Brian wasn’t, franchisees weren’t, the guys in the trucks weren’t. Second thing was I wanted to leverage free PR and start generating a lot of press because we had no marketing dollars, but we could get a lot of press coverage to drive the brand. And then third is I wanted to create a really strong company culture. So we became a magnet for talent so that we could actually recruit people faster because we knew that we were going to grow quickly. If we were going to go quickly, we had to be able to acquire talent quickly. So that was a very early cognizant decision.
Michel Falcon:
If somebody has building their company culture as something as a core focus or they want to give them more attention or more budget, whatever it might be, where do they start?
Cameron Herold:
The first starting point is to really understand your company’s core values. Right. So what are the core values that you’re willing to fire people if they break them? So they’re not aspirational values, they’re literally things that you will die for and they should be a maximum of four or five core values that you hold so dear that you’re willing to recruit based on them and fire people based on them. That’s number one. Second is really understanding your core purpose. Really truly understanding why you exist. My core purpose is to help entrepreneurs make their dreams happen. So I say no to many podcast interviews. I say no to speaking events. I say no to clients if they’re government or non-profit or corporate. I only want to work in the entrepreneurial space. So really understanding that core purpose.
The third is understanding your BHAG, your Big Hairy Audacious Goal. At 1-800-GOT-JUNK, that was to become a globally admired brand. For me it’s to replace vision statements with vivid visions worldwide. And then the fourth corner, I think of it like four corners of a jigsaw puzzle, the fourth corner is having your vivid vision, right, a true clear four or five page written description of what your company looks like, acts like, and feels like three years in the future so that all of your employees, customers, and shareholders can all see the same vision that you can see. So they all make decisions aligned with that same intuition that you have.
Michel Falcon:
And developing the core values, is that a kumbaya session over a half day? Place yourself in where you’re doing that.
Cameron Herold:
I think you already know the answer to that one. It is not a kumbaya session. It’s literally the time when the entrepreneur, the CEO must craft the vision for themselves. It has to feel so strong and so powerful and so right to them that they’ll literally magnetize and pull people in and at the same time push them away. Right. When Steve Jobs launched the iPhone 16 years ago, the same year that I left 1-800-GOT-JUNK, what was missing on the iPhone? We all thought he was crazy.
Michel Falcon:
Oh, the keypad.
Cameron Herold:
The keyboard, right? Where the fuck, no one will ever buy it. And he’s like, I don’t care. We’re launching it without a keyboard. We’re going to create this insane, and then as soon as you saw people typing or click like can I just try it? And as soon as we tried it, we were hooked. That was challenging the status quo, that was creating these insanely great tools. And if he took everybody’s opinion, they would’ve been just like Blackberry.
Michel Falcon:
You talked about growth. You were the 14th employee at 1-800-GOT-JUNK managing company culture when your company’s growing.
Cameron Herold:
Yeah.
Michel Falcon:
Now I’ll plant the seed. And being able to do that is adhering and upholding your core values. But aside from that, how are you making it stick?
Cameron Herold:
It’s recruiting people that are cultural magnets as well, right? Recruiting people into the organization that become magnetic forces so that they spin more of that culture flywheel. Right. It can’t just be the founder. It needs to then become the leadership team and then it needs to become the mid-level managers and then it needs to become the frontline staff. So the more people that you recruit that live the core values, that are obsessed with the vivid vision, that love the core purpose, that are driving that care about each other, and the more that you fire the negative grumpy, toxic people, that’s when the culture starts to spin on its own and it becomes a flywheel. It’s kind of like if you have an amazing party happening and you have two negative grumpy people, the bouncer’s job is to get that negative energy out of the club. Right. If you keep the negative toxic energy in the club, it fucks up the whole party.
So it’s the job of the leadership team. And I don’t think I’ve seen many companies ever that work hard enough to get the wrong people off the bus. Jim Collins talks about getting the right people on the bus, the wrong people off the bus, and everybody in the right seats. Most people talk about interviewing, recruiting, training, onboarding, leadership development, growing people, but they don’t talk about identifying the wrong people, getting them out quickly. Right. They don’t talk about getting those cultural cancers out of the company.
Michel Falcon:
And do you believe in performance reviews within a company culture or is it go left or go right with individuals?
Cameron Herold:
Well, so this is something that I ask people that have kids. I know you don’t have kids yet, but hopefully that’s coming down the pike for you soon. Do you think that you do performance reviews with your children? What do you do? If one of your kids does something wrong, what do you do? Do you wait till the end of the quarter, end of the year?
Michel Falcon:
No, in the moment.
Cameron Herold:
In the moment. Right. And if your kid does something right, what do you? You praise the heck out of them in the moment. I believe performance reviews have to be in the moment and we have to teach leaders to find people doing something right, to find people living the core values, to catch people delivering on their promises, to catch people hitting their goals and hitting results, to put systems in place for any time we set three new goals to celebrate, three goals that just got completed. But we have to praise and do performance reviews on a minute by minute, hour by hour, daily by daily basis. And that’s what supercharges your organization. But to wait and do quarterly and annual performance reviews, you miss the mark. Completely miss the mark. But it’s a key skill that you have to train people to actually do performance reviews on a daily, hourly basis like raising kids.
Michel Falcon:
I find that when developing core values and building company cultures, often entrepreneurs or leaders will look to other companies and try to kind of replicate what they’re doing. Is it a good starting point or is it don’t go down that path?
Cameron Herold:
I think it’s an okay starting point to understand what other companies might be doing. But what we need to do, and the reason they start there is they’re not sure what the real process is. So I like Jim Collins’s mission to Mars process where you sit down and you look for the four or five employees in your company who are most representative of the amazing humans you want to keep attracting. And then you describe those people. What are all the things about them, the traits about them, how do they operate and show up on a daily basis and you’ll end up finding four or five commonalities amongst the four or five people. Those tend to be your core values.
Michel Falcon:
What do you know now about company culture that you wish you had known when it was 2005, 2006?
Cameron Herold:
That leaders can destroy it by hurting the energy with kind of coming in too strong or like the CEO’s job is to be the chief energizing officer. Right. I destroyed the energy at 1-800-GOT-JUNK for a period of 30 days back in around 2003 when I just really laid into everybody one day at huddle about how much time was being wasted with meetings and with showing up late for stuff and not respecting others’ time. And I was dead accurate, but my delivery, it was almost deflating a balloon. And I think we have to remember that to build a culture, our job is to stir the Kool-Aid, right? Our job is to raise people energy or to raise their enthusiasm, to say thank you more often, to be grateful more often, to catch people doing something right more often. And I think as leaders, we tend to keep giving them more to do, pushing them harder, setting more goals, and we forget to say how often that we love them and thank them. You’re engaged now, how often do you tell your fiance that you love her? Once a quarter.
Michel Falcon:
No, daily.
Cameron Herold:
Yeah. Multiple times a day. Right. And that means that because you’ve put all those deposits into the love jar, when you have a fight which is inevitable, you actually are drawing on a bunch of those deposits you’ve already made. But if you only say, I love you once a quarter, the fight blows up the relationship. Well in business, most leaders misunderstand that to build that strong company culture, we have to be praising people and thanking people and celebrating so often so that when times get tough, they don’t feel, we haven’t shaken the core, right. we haven’t shaken the foundation of Maslow’s hierarchy of needs where they need safety and security at level two.
Michel Falcon:
When individuals are fighting for budgets, well, maybe fighting is not the right word, it’s not fitting for that, but trying to present their case for their yearly budgets for the departments and something like company culture isn’t as clean cut or measurable in terms of ROI, as a social media ad campaign. What do you recommend individuals that are looking to get that budget to develop their company culture, invest in their people when the ROI isn’t so black and white?
Cameron Herold:
No, I recommend that the leadership team actually teach financial management to all the employees. 100% of employees need to understand the P&L and how it works. They all need to understand revenue and cost to good sold and gross margin and overhead and net margin. And then they need to understand taxes and depreciation and EBITDA. They need to understand the P&L and how it works. Secondly is all employees need to understand return on investment, return on time, return on people, return on money so they can understand that if I do X, what does it yield? And that’s true of any investment in the company, right? If you’re going to have an employee work on a slide deck for two hours and that employee is a $70,000 person, you’ve just paid them $35 an hour for two hours, which is $70 to work on a slide deck.
Well, if your company’s gross margin is only 35%, that means you need to earn $250 in revenue just to pay for them to work on the slide deck for two hours. Would you really be doing that? Well, most companies don’t teach that level of understanding to employees. So in the absence of facts, people make up their own. Right. In the absence of employees understanding the P&L and how ROI works, they get frustrated thinking that we don’t like them or we don’t like their idea. And most entrepreneurs are really bad at explaining that we just did the math in our head very quickly because we often don’t even understand that we did it that way. So it’s really teaching the basic P&L and teaching decision making to employees so they understand that every project can be green lighted, yellow lighted, or red lighted. And it doesn’t mean that we don’t like them or that it was a bad idea. It just means in the light of all the other things that we’re doing, it didn’t stack up as something that we’re going to work on right now or maybe ever.
Michel Falcon:
Is there an executive, a recognizable individual in business let’s say, or maybe even in sport who you believe would’ve been extraordinarily company culture centric that you wish you had the opportunity to have built a business with?
Cameron Herold:
To build the business with them, no, but I really wish I knew Herb Kelleher from Southwest Airlines, and I emulated him a little bit. Fortune Magazine asked me in 2003, how do you hold your employees accountable? And I said, I don’t. I hire accountable people. And they asked Herb Kelleher, how do you get all your employees to smile? And he said, we hire smiley people. And I think he understood the basic of humans is if you need team players, hire team players. If you need happy people, hire happy people. It’s not very complicated. Right. I think that would’ve been cool to have worked around him to understand that. I would’ve loved to have worked around Steve Jobs. I think Steve Jobs is very, very misunderstood with some of his comments. He would walk into a meeting and be like, why the fuck are you here? He wasn’t being a dick.
His computer just kind of went off in his brain, he is like, the math doesn’t compute. Your ROI is more important for you to be back at your desk working on these three projects than it is to be in this room. And he was okay with not being the Kumbaya group hug with everything, because for him, it was all about return on people, return on time, return on money, and he just understood those calculations very quickly. He might have been bad at maybe articulating it, but I think his sense of simplicity was brilliant.
Michel Falcon:
My last question, Cameron, it actually has to do with the guest experience. So you go to a fast casual restaurant, how do you define a brilliant guest experience within a fast casual restaurant?
Cameron Herold:
Yeah, I like it when there’s a human connection. When the employee just has a human connection, whether it’s eye contact, but it doesn’t feel processed as much, right, where they’re not kind of going through the steps, but they get your name, but it’s like, Hey, what’s your name? Oh, Cameron. Oh, that’s cool. I’m Kelly, but, and without kind of schmoozing it, right, I’ll be your server today. Or, you know what I mean? It’s that. It’s just like you go to a great coffee shop and you have an interaction with a barista and then you go to another coffee shop and it’s very flat or you go to another one, it just feels, it’s just that, that human connection and the simplicity, and it’s hard to teach that. I think you have to do is you hire people who have that natural, innate ability to have good human connections with others.
Michel Falcon:
Cameron, you’ve written four books.
Cameron Herold:
Six.
Michel Falcon:
Six, pardon me, and I’m looking at my bookshelf right now, and I definitely have at least one of each. Cameronherold.com COO Alliance. Your podcast has how many episodes?
Cameron Herold:
We got about 260 episodes on the Second in Command podcast now. We got about 50,000 listens per episode.
Michel Falcon:
If there’s somebody, a COO or equivalent guest you could have on your podcast, who would that be?
Cameron Herold:
Oh, so my podcast, we only interview the second in commands for companies. We never interview the CEO. I would absolutely love to have the Queen Bee of COOs Sheryl Sandberg.
Michel Falcon:
Ooh, that’s a big one. Is she still actively working [inaudible 00:19:54].
Cameron Herold:
She left Facebook about a year ago. She was the COO for Mark Zuckerberg for 15 years. She’s arguably is, I talk about her in my book, the Second in Command, but she’s easily the most requested guest we have for the podcast.
Michel Falcon:
Phenomenal. All right, everybody, go check out Cameron Herold. Just search his name online. You’ll find something. He’s probably on every single platform and go listen to his podcast by his books. Thank you very much for listening to this episode, and I’ll see you next time.