The Comp Plan Mistake That Quietly Kills Team Trust

I'm going to treat this the way a professional athlete treats their craft. They train in the offseason like they've got skills to develop. They take it seriously. They show up and they hold their own standard for themselves regardless of what the team's doing. That's what the best athletes in the world do. I'm going to do that as a coach. And I'm just going to be so good in my seat and in my preparation that if something gets out of whack with the client, it's not going to be because I didn't put my work in.

All right, here we go. Lonely Kraken Media. They are a $22 million ARR email platform for independent creators. They're three weeks into Q4 and revenue sitting 14% under forecast. Even though their dashboard in a conversational intelligence tool that shall not be named shows every rep hitting call volume targets and the all-hands deck still says that we protect people first. The COO pulled the engagement scores last week and found that two of the best account managers are quietly job hunting. And the culture deck and the comp plan have been telling two different stories the entire time. You ran opposite a company that hit $40 million telling this exact story on your own podcast with the founder sitting across from you admitting the safety talk and the we're here to win talk were fighting each other the entire time. My question is, when a company says it protects its people, then measures managers on velocity anyway, who's lying—the deck or the metric?

Welcome to the show, man. This is good. I love this. It does drop me right in. Thanks for having me. I wrote a little bit of an essay on this. I called it "Talent as a Culture Multiplier," and it was around one of my key learnings from running Kit and growing it to $30 million while I was there. And then they've continued growing on to, I don't know, mid-50s at this point. And the big thing that I saw with our culture, which was a huge focus for us, it was like take care of the people and exactly what you said. We measured on hard data and there always felt like this conflict because of course you're responding to the market. You don't ever know what's going to go on out there when the plan hits reality. And so you've got to be able to adapt. But the thing I look back at now is we did create a people-first culture and people did appreciate that and we had great retention because of it.

And I don't know if you've ever seen these studies that say that there's actually a downside to too much IQ in terms of on-the-job performance. And so there is a point at which IQ gets so high where it's negatively correlated to on-the-job performance. I'm going to bring this back around to the point that we're talking about here. I think that there is a similar curve to people-first culture where there is a point at which a people-first culture takes it so far and takes retention so far that you end up keeping people who are underperforming but you couch it in this idea of we're taking care of people.

And what that ends up doing—and the point I made in this essay, "Culture or Talent as a Culture Multiplier"—is that you bring down the average performance of the team by tolerating low performance from anyone for too long. And so if you've got a bunch of high performers and you're distributing profit on a little bit of an egalitarian basis in your profit-sharing plan like we did, what the top performers learn is it actually doesn't matter how well they perform because they're going to get the same check as everyone who was underperforming. And the longer you tolerate that, the more your incentive alignment is just to do enough to hang out and get by. It's like the key to surviving a bear attack is having a friend who's slower than you.

>> C players attract C players.

>> And they make A players B players is the other part of that.

>> Yeah, the bear will get Adam first.

So this is great news.

>> You know, we've never done a running test.

>> We should have tested this in Bozeman. This is that was a total miss.

>> We all have to go back. Barrett, you could film it. I heard there's a bear up there that they actually bring out and show and I've actually heard his name is Adam. Funny enough. True story. Not making this up.

>> And we'll see who gets eaten. Dale, just make sure you sign that paperwork that gives me your shares of company before you leave, please.

>> Otherwise, they go to Kristen. And I go to Kristen and my daughter. So if my daughter gets in here, you're in trouble.

>> So I'm screwed. I guess she's going to work me harder than you ever do.

>> It's really interesting. And I like the IQ conversation and that reverse correlation. And so I do want to double click a little bit onto this culture space. So you had Nathan Barry on your podcast and what he was saying was at the top he wanted everyone to feel safe while he and leadership—you were the CEO at the time—were privately telling each other like we're here to win. What did you personally do inside that gap and what should you have done differently instead? Like what would you have done differently?

>> I think that we both agree that fundamentally, at the end of the day, bottom line is we should have fired more people. And that's an uncomfortable thing to admit.

>> I love that you just said that by the way because it's real. It's raw. It's honest. It sounds like the opposite of safety though.

>> It's the opposite of safety. And because—and I want to let you finish, but I want to come back to—at the end of the day, if you keep someone who's not great at their job, I've always said I'm doing you a disservice by making you think you're doing good and I'm ultimately holding you back from what you really could or should be doing. Yet Dale is still here, but I digress. Please go ahead.

>> Okay, so there's two sides of this. One is it's just like setting boundaries with—I'm not saying that employees are like toddlers. I have toddlers. This is why I'm making a toddler reference. When you set a boundary with a toddler and you don't follow through on it, what they actually learn is I can violate the boundary. It doesn't matter. Nothing happens. I'm going to keep doing what I want. Whereas if you say, "If you make this choice, this is going to happen," and then you follow through on that, they understand the expectation. And then they learn to live by that. And it creates clear, predictable boundaries on their behavior that actually creates a sense of safety for them.

I think there's something akin to that in building culture where if you set clear expectations, you tell people what will happen if they don't meet them, and then you do what you said you were going to do because they didn't meet them, everyone knows where they stand. And I think there's certain allowances for if you put an employee into a buzzsaw of market conditions and it was not possible for them to hit those metrics, then you have to own that, too. And that's a leadership problem at that point. But it needs to be clear that we're re-evaluating the targets that we set because we believe we set unreasonable targets given the market conditions, not we're tolerating your low performance here.

And so I think that safety and performance are not opposites to one another. They're in tension with one another, but it's all about: Are you communicating clearly? Are you making expectations obvious and transparent? And then are you following through on consequences if people don't meet them? And I actually think that aids safety because everyone knows where they stand in the face of that.

>> That's funny you made the analogy of a toddler because I definitely have to treat Adam like that every time we get on the phone. So it's a great analogy.

>> Dale, I just sent you a text message that I think is important for you to view mid-show here. That lets you know my thoughts of how you're going right now. I agree 100% and I don't think it's wrong to say I should have fired more people. I don't like the saying "hire slow, fire fast." A lot of people say that and I disagree with that. But as I said, one of the things that I do think is really important is the longer you allow people to feel safe—and I'm going to use that word intentional—and you allow people to feel like they're doing a good job and that their performance is acceptable when it's not, you are very much doing them a disservice for career growth, for their current career.

And I tell the story anytime I'm on a podcast. I had a leader who told me flat out, I didn't get promoted three times because I was an asshole. And she's like, you're never going to get promoted here unless you change that. I owe it to you to tell you that. So if you want to be promoted and you want to be a leader, you have two choices. You need to fundamentally change who you are and how you act or you need to go do it someplace else. I could literally picture where I was sitting when we had that conversation. Fortunately, I chose to fundamentally change who I am and how I act. But she certainly could have let me keep chugging along until I left. And then I would have been an asshole somewhere else. Now, even if I would have left the company, I still would have had—

And if I had any level of EQ, I would have changed my performance. So I think you hit the nail on the head. But I think most operators are going to go back and call all of this a communication problem. You know, you fix this with a better all-hands script or you fix this with better messaging. But I don't think it is communication. I mean, correct me if I'm wrong. I don't think it's communication. I think it's fundamentally the culture and how you operate the business.

I think it's both, is what I would say. I think it's both a culture thing, and the way that culture plays out is through one-on-one communication between managers and the people who report to them. If you have managers who are not willing to say to their people, "If you don't turn this around, I am going to let you go," I would bet that less than 1% of people listening to this have managers in their company that are willing to say that to their people. I would bet less than half of a percent.

Yeah, exactly. Why? Because it's true. That's the conversation you have in the leadership meeting. So why? Because that's not kind. It's not nice to talk about.

Well, it's perceived as not kind.

Correct. And it actually is kind. Not having that conversation is unkind because what's going to happen is someone's going to get fired and they're going to be like, "Well, I don't know what I did wrong." I have always said to everyone who's reported to me, if we sit down and have a conversation and I'm firing you, unless you've lied, cheated, or stolen, I promise you we've had 37 conversations beforehand that you should never be surprised.

Yep. And that, Dale, we have a call after this.

Yes.

Nice.

Sometimes people still claim surprise, you know, even though you've done that. But if you've unequivocally said, "This is what I need from you, and if it doesn't change, I'm going to have to let you go," that's on them. Then if they say they're surprised, and I do think we owe that to people because we're not being clear enough if we just say, "Oh, you know, it would be really nice if you tried to turn it around over the next quarter and then we'll have another conversation." If on the other end of that the next conversation is we're letting you go, yeah, of course they're going to be surprised because you acted like you were their best friend and you were just rooting for them the last time you chatted. And that's something different than being clear with them.

It is so hard because I think the older I get, the more I realize people just don't want to have hard conversations. I just think they avoid it at all costs because one, they're not really prepared for it. And two, they don't realize the other side of it, which is you're allowing someone else's lane of genius to go somewhere. But those people that are getting fired, they don't have a soft landing in a lot of cases, and so that's why they get surprised and they have a bunch of fear. So, Barrett, when you were at Kit, you were the COO and you get into a place where values kind of collide with P&L sometimes. And so I'm curious, where did you personally fold when high performance won over values? And how long did it take you to notice that and be like, "Oh, I'm doing what I am not aligned to?"

Oh man, I think we actually erred in the other direction more often where we needed to push more on performance. We erred on the side of treating people kindly, quote unquote. And then we quietly had leadership conflict over the results of that. And so what I wish I had seen now and done, looking back, is we weren't aligned on the approach we wanted to take. And so because Nathan and I were having conflict over what approach we wanted to take, that played out downstream in a hundred different ways. And I think this is a central tension that many companies go through: when you have co-founders or key leaders who have competing—not like opposing, but competing—agendas or priorities or value sets, that has to get aligned before the company can get aligned.

Dude, from your mouth to his ear, and it doesn't matter how big or how small of a company you are. We just went through this collectively as an organization, and having your values aligned is so critically important whether you are a two-person, five-person, 500, or 5,000-person company.

Every time, and everyone feels it in the organization if it's not there. And so for us, the key distinction that we had between us was we both believed in the power of people. We both believed in great culture and psychological safety. We both believed in high performance, but we had a fundamental disagreement on how much did we want to hire and use hiring as a tool for growth. At the time—this has changed since then—but at the time, Nathan really wanted to try and keep a small, nimble team and grow as much as possible within that constraint. And I really believed in the power of hiring to drive growth. And that conflict drove so much of what we struggled with: which kind of company are we going to be? And AI wasn't an option then to solve and create a third option basically. And so we just never resolved that, and it played out in poor performance across the organization.

Would you be now? Has your stance changed?

I think there's a lot more that is possible now with the tools we have available and the technology we have available. And so I think I would probably be a hybrid where people still have to build the tooling. You have to build with AI. You can't do it yet where the AI is building itself all the way. So I'd probably be a hybrid where we'd be people first with technology as a core backbone, and we'd probably expect more productivity from every person, just realistically. Do I think that's awesome for the individuals at all times? No, I don't. But I think it's what's necessary in the current competitive environment between technology companies trying to win market share.

Yeah, and you're trying to squeeze as much productivity out of people and like that feels uncomfortable as well. And at some point from a transparency perspective, you can only get so many good A players or even B players. Like as you grow, I think that's where people get it wrong. It's impossible to hire that many. Your cost of execution would just go through the roof. You can't hire all A players. And even the A players you do hire may not be A players.

Right. And the challenge is if you're not one of the top three or five AI companies in the world right now, you can't compete on pay because they're willing to pay for literally the best people in the world. And if you can't compete on that, then you're selecting from the next set of talent below that. And acknowledging that is just a necessity of life when you're leading a team in a company. And so I think the question is what leads to winning culture? I had another buddy of mine, Mike McDonald, who's the head coach of the Seattle Seahawks, on the podcast, and they've been the subject of Hard Knocks, which is a show on HBO that's kind of pre-season every year for the NFL. And it's been really interesting to get to see the behind the scenes of him leading. I've heard it from his mouth, but seeing him in the act of leading and the way that they build organizational habits that they believe lead to winning, I think makes it possible to bring people up a level in terms of their performance over time. But you have to have those pillar people who are in there. Cooper Cup is in the quarterback's room and the receivers room and in the whole team room as one of the key figures kind of like being a player coach along the way. You've got to have those people in your organization if you want to raise the bar for everyone. And if you don't have that and you don't know what the organizational habits are that lead to performance, it's just not going to happen.

Or you end up like the Miami Dolphins, and that's not a good place to be.

Great.

But realistically, what percentage of organizations do you think can do this? You seem like—

Yeah.

Like how realistic is this and how much effort is this?

I think it's a ton of effort. I think it's actually more of an effort thing than it is a what's possible thing. And I think the fundamental reality is that most leaders are not willing to put in that amount of effort to build great organizational culture. And so I think that's the first question for people to ask themselves: Do I want to become the person that I have to become so my organization can have that kind of culture, or am I good with the 75th percentile outcome I'm getting right now and I just want to ride that until an exit or something like that? And I think that's really what it comes down to. If you can get a 75th percentile outcome by not changing who you are, your identity, or not working on the hard part of your personality, and you're going to make $50 million selling your company, most people, I don't think, are going to put the effort in. So I think that's part of the challenge.

Are the financial incentives and where are just the human values and how do those compete with one another?

Yeah, that's so true. It's all work. Whether you're doing sales calls, closing deals, it's all the small stuff that people don't want to do, the hard work. And then they realize you haven't built the foundation. So you put culture on a slide and you push out everybody, but you haven't done the work underneath it to sustain it in the long tail.

If you watch Hard Knocks, you'll hear Coach Mike yelling constantly at the offense: "Why haven't we snapped the ball yet? Why haven't we snapped the ball yet?" And what he's trying to instill in them is when you break the huddle, you sprint to the line and you hike the ball on your count. That is a habit that we build as an organization. We don't walk to the line. We don't mosy around the field. We get up to the line and we run our game.

And I think there's something akin to that with sales culture, for example. Are you actually logging things? What activity have you done? Have you done your follow-up with the people that you're reaching out to? Do you actually know what their organization does? Are you tailoring your pitch to what they really need and what they're struggling with?

I know go-to-market people will listen to this and they'll think, "Well, no, we don't do any of that because that's really hard." It's like, "Okay, well are you happy with your results?" Sometimes it's not that difficult to understand, but it is difficult to change.

Yeah, absolutely. Barrett, a founder calls you after burning out half the team chasing performance. What's the first concrete thing that you're going to do with them that week? Where are you going to start?

This will sound a little odd, but the thing I would want to know from that leader is how many of these people do you know? What's their story and why are they in your organization?

I don't think that's odd at all. Tell us more. Why is that odd? I love that. This goes to leadership.

I'll give you the question I would ask them and then I'll give you an exercise everyone should do with their teams.

The reality of the matter is that no one's going to work at your organization forever. Period. Full stop. End of story. So the question is: what period of time is going to give this person an increase in trajectory in their career and how can you help deliver that for them as their manager, their leader?

And if you can frame what you need from them in terms of their trajectory increasing in their career, I think you're going to get way better outcomes from people than if you only frame it in terms of "here's what I need from you right now. Go do it."

Where the story comes in is if you don't understand where they've come from and who they are, you can't possibly understand the trajectory they're on and why they're actually there.

So the exercise that I love having people do is if you have a team of any size, if you could spend 90 minutes doing anything, what I would have you do is ask every person to write down three pivotal moments in either their life or career. They can pick whether they're personal or professional, and they can determine how open they want to be. So you make it kind of safe in terms of the territory they're covering.

And the whole 90-minute meeting is each person sharing at least one of those pivotal moments that have changed their life or career, and then following up with the team with the written version of all three.

What you get from that is you start to understand what shaped people, why, what have they been through that's brought them here, and who are they? How did they respond to whatever these pivotal moments were?

In leadership research, we would call them crucible moments. What have been the moments that brought them to this team?

And in doing that, in Georgia football, they have sessions called skull sessions or something like this, which was basically a football term for getting to know each other. And they found that after they sat teammates down across from each other and they told each other life stories, the kind of environment they grew up in, hard stuff that they faced, their likelihood to collaborate on the field and their performance in terms of outcome on the field went way up. And so now this is a habit that they have in the organization.

And the fundamental reason is we're human beings who love story. No matter how many metrics you put in front of someone, if you understand what someone's been through to arrive as your teammate, you're going to care more about helping them win than if they're just a person who has an outcome that you need from them.

So this would be the exercise I'd have you do. The question I'd ask you is: how well do you know the people on your team and what their current role represents in terms of their career trajectory? And the assignment I give them is do the three pivotal moments in your life exercise.

I love that because it is true. And I think all the way back to like we do a lot of work with companies on job descriptions and trying to figure out what people are doing within a job description, but they don't actually believe in the job description. I don't think because whatever the job description is, they come in and you have something completely different that you're asking them to do. And then we wonder why people are unhappy and then end up leaving or don't want to do their job.

But one of the things I like to ask in interviews, back to your question, is: where have you been and what do you want to do? It's that simple. It's not like "tell me something about like when you closed XYZ deal." I want to know: is your mindset or your compass in the same direction as either the team that I'm leading or the company or wherever it is? Because if those fundamental things don't align, at some point you're going to lose that person, whether they're not going to be able to perform properly or they want to leave. And either one's not good because it costs companies so much money to hire, onboard, and recruit. And then especially in the sales world, they're leaving and now you're like, I forgot the numbers, like quarter million dollars per rep that leaves. And that doesn't even count for any of the pipeline stuff.

So I think that's a really good point. I think you want to select for a mindset of momentum, and you want to see in their eyes that they believe the role that they're interviewing for represents momentum for them.

And the problem with salespeople, of course, is salespeople have gotten really good at selling things whether they believe them or not. And so I think the thing you have to get good at as a go-to-market leader hiring someone whose whole job depends on their ability to convince someone else to do something is: can you ask the penetrating questions far enough down to get to the levels of motivation and really see the truth come out?

And if you just accept the first answer they give you, anyone is going to say something in response to "how will this role help you grow your career" or "how does this role change the trajectory of your career?" Whatever version of that you want to ask, every person who's decent at sales is going to have an answer for that off the cuff. And so the question is: are you going to challenge that and really dig in with them or are you just going to say "okay, next"?

Yeah, 100%. I always think about it similar to kids. We went back to kids before with toddlers, but I have an 18 and a 21-year-old and now it's a different trajectory. However, in the moment you kind of have to understand and they have to understand the why. You ask them to do something and they may ask you five whys and you're like, at some point, but it totally makes sense as you get older and you start having these conversations. Getting to that fifth why is really where you get the meat of what's underneath it.

Yeah, I agree with you.

Here's something I keep seeing with sales teams I work with. Generic sequences don't work anymore. We've all gotten so good at turning out the noise that even your own buyers are ignoring you. The problem isn't your reps. It's that your sequences are static and your signals are somewhere else entirely.

That's why our clients use Nooks. And the thing that stuck with me is that their sequences actually stay fresh because the signals update them automatically. Right buyer, right moment with no manual babysitting.

If your outbound feels like it's shouting into a void, go check them out at nooks.ai to bridge the gap.

So I'm curious going into comp plans and understanding comp plans a little bit. A lot of salespeople are money motivated. I don't always believe that, but what can you do when you're building your comp plan that would make some of the value pieces maybe not as high as dollars and cents, but something that would motivate them as they're building the comp plan to be as important as some of the comp?

Oh man, I think that this is one of the great unresolved questions in all of organizational culture and organizational psychology.

My understanding of what we know about the psychology of comp is that variable comp tied to outcome is actually pretty ineffective for anything that is not a rote task. And so part of this gets into a philosophical debate over whether we think sales qualifies as a rote task that just has to be done on repetition or whether it's a creative piece of work that requires a lot of judgment. And I don't know where to land on that, but I think that the best salespeople are some of the most creative people in the world. And if you really want results, you've got to give people freedom to operate. You can't just give them a playbook that they run no matter what the situation is. And I think playbooks give people a sense of security, both managers and doers, but they don't always get good results. And I think the best salespeople you find are relational. They understand how to sell a story based on the context they're selling into. They understand a lot of things that are not coming out of a playbook. They're the ones creating the playbook for the people who are coming behind them. And I think in that kind of setting, it is tough to create an extrinsic motivation-based comp plan for a person who is intrinsically motivated by the creative urge to solve problems in a sales environment. I just don't think they match very well. And yet the sales culture is if you're going to bring revenue in, you deserve a share of that. And so I haven't—I legitimately never figured out how to solve this problem.

We tried it in the kind of Adam Grant drive psychological philosophy of we're going to comp people based on having a salary and safety and security and then we're going to trust you to go out there and be creative and solve problems and sell. And I think that had its flaws. I've seen the opposite too where we're compensating people based on quota percent to quota and rising scale of pay based on how close you get to the number we're asking from you and that has downsides too. So I think it's really about picking a poison, naming that to your team, acknowledging the downsides of the comp plan that you've designed and saying hey, if this is demotivating you I want to have a conversation about it. I don't want you to just quietly be resentful over there in your corner and stop performing because of it.

What you just said is key. You have to encourage people to be able to dissent appropriately and voice their concerns. And I think in so many organizations, we have this culture of like you can't talk back or you can't question the lever or like how dare you say that this doesn't make sense and if you do you're going to be on this blacklist and you're going to get fired and like that's everything that's wrong. Now listen, don't be a jerk and like blast this comp plan sucks. Like there's a way to do it diplomatically. Don't come at your boss like Dale comes at me when I'm ten minutes late on a distribution. True story for another time. But if you do it the right way, going back to that culture, that's how you build things from comp plans to companies where people want to stay.

Yeah. And I think this comes back to like having a culture of responsibility instead of accountability. And so there's both sides of this where if you're the salesperson, you have to be honest with yourself. Have you actually put the work in to try and get to quota? Because if you have not actually put the work in and you're complaining about the comp plan, then you are creating a culture that is inviting enforced accountability. That's your part in the whole equation. And then if you're a manager, are you actually acknowledging the environment that your team is selling into? Does your product suck? Is it legitimately worse than the three other competitors they're selling against? Are there headwinds that are actually affecting the sales environment that are that should be causing you to lower quotas right now? Like if you haven't acknowledged this, and for a lot of middle managers, they probably can't because they feel like they're getting it from a spreadsheet up above them and they have to deliver on it to salespeople down below them. But if you're not acknowledging that, then you're contributing to an environment where your people are going to get demotivated because you're giving them goals that they can't achieve. So some of this is it's a two-sided problem and everyone's got to come to the table and take responsibility for it or else we're just dancing around the thing that can't be said.

And I'll be interested to see how this whole compensation thing plays out with AI and where things are going with AI and sales into client success because now like revenue shifting all over the place in the space and I see a lot of like AI native, AI agentic companies looking to measure revenue based on headcount and not just go-to-market headcount but headcount on engineers. So, like if we have five engineers and we're doing fifty million, so all of a sudden we're doing ten million per head. Like there's like some weird stuff starting to bubble and percolate. And I'd be super interested to see how this affects both values, culture, and compensation.

Yeah. I mean, this gets to the heart of—this was the heart of one of the reasons I left Kit that Nathan and I talked about—is one of my lines of comp, speaking of comp design, was revenue per employee. And it creates this like two-sided incentive where if you're both trying to be profitable and drive revenue per employee and you're not getting the growth, it's like, all right, now I'm getting hit three different ways on my comp plan because we can't drive the growth that would allow this to be possible. And if you've got a revenue per employee target, like what's your philosophy on hiring ahead of growth where you're going to dip down below? And then if you do that, where do you draw the limit of how far below the line you're going to go before you expect it to come back up? And like I know I'm not giving answers right now, which is not great for content, right? But I think the reality is that these are the hard strategic decisions you have to ask yourself when you're designing comp plans for people.

All right, Monday morning move time. Barrett, you have two tasks here. Number one is to grade my Monday morning move from one to ten.

Okay.

And be honest, Dale. There is no zero option, dude. We have this conversation every week. You got to learn one to ten. You clearly know where Dale wants you to grade it. Option number two is what would you add? What would you remove? What would you push back on? Any of those are fine. All right, here we go.

Pull the three phrases that you've used publicly to describe your culture this quarter. Sit with each one of your direct reports for ten minutes and ask them to rate out loud how true each phrase feels day-to-day in their own words, not yours. Write down the gap exactly as they say it. Then pull your last two promotion or bonus decisions and check whether the behavior you rewarded matches the phrase you said you valued. If there's a mismatch, time to fix the incentive underneath it.

I like the intent behind that. So I'll give it like a six and a half.

Here is my challenge with it.

No. Yeah. Give it to me, man.

So just to level set here with the audience. Best books that I read are always rated a four on Goodreads. I reserve a five on Goodreads for like the best books of all time, you know? I'm trying to reserve that.

Goodreads is one to five.

Yeah. One to five. Yeah.

Okay, cool. So a three is like that's what an average book should be, right? I mean, that is the reality of reading books is a three should be an average book. And then I usually just don't rate it on Goodreads if it's worse than that because I don't want people to feel bad about themselves. They put the effort in to write the book, you know? I respect that. Okay. So a—

How many books have you read that you haven't rated?

Oh, this is a good question. I bet it's probably like one in every eight or ten.

Okay. I feel like selection has gotten better with time and I just don't read books that I anticipate might lead to that. So that's a big part of it. Okay. So a six and a half. All of that is to say a six and a half is not a bad score here. My number one challenge I have with this exercise is the first half of it is going to go exactly as well as the amount of trust that exists in the organization.

Very good callout.

Because if there is not trust, if there's not default trust in the relationship, the person you're asking the question of is not going to be honest with you and so then you're getting bad data to begin with. So in a way it's like a Rorschach test of that organization. That exercise is going to go exactly as well as the quality of your trust and your culture and the reality is that probably the organizations that would run it are the ones that are already doing pretty well on it. Okay, so that's my issue. But the exercise as a whole, if you assumed that people were to engage with it openly and honestly and to actually answer the questions, I think it would be super helpful because you get a real read.

On, hey, this is what we say we believe, or what I might call aspirationally value, and this is your opinion on how we're living that out day to day. And your goal as a leader of a company should be to make the gap between those two things as small as possible. That your aspirationally stated values reflect the actions that you're taking day in and day out, and then that your incentives make it so that people get rewarded for that.

We had this value at Kit that was "do less better." Theoretically, the idea was have fewer priorities and really knock them out of the park. The amount that we lived that was approximately zero, and every person in the organization knew that. You look at our priorities for a quarter, and it's a freaking laundry list. That is not doing less better. And everyone knew it, but there was some hangup about it because we knew theoretically that would be a good thing to live out, and we just couldn't embrace that we weren't doing it. And so instead of letting it go and actively making the decision we're not going to prioritize this anymore, we let it hang around, and everyone knew it was an integrity gap. It was like a thing we said we cared about that we never acted on. And that drives a lack of trust.

But you see that in so many companies. Like, what you just said is so key. It was a thing we said we cared about that we never acted on. I'm going back to Dale. When you and I first met, we talked about our values, right? What are the values of our company going to be? And Barrett, I think a lot of companies do this, and the most common one—and I'm going to upset a lot of people when I say this—was DEI. We're going to throw some DEI on our website and say that we believe in diversity, equity, and inclusion. And then we're going to sit around the room with a bunch of bald white dudes that look like me that are in their fifties. That is not DEI.

Now, your feelings on DEI to the audience don't really matter. I'm just using it as an example. This isn't a political conversation. But how many times do you see companies' values displayed on a website, and whether you are a customer or whether you are an employee, you're like that is BS? Like, you put that there because it looks good in SEO, and it's going to bring people there, but none of this matters because you don't live it. So I think this is so much more common than we see. How do we fix it? How do we truly—is there a way to get people to live their values? Because I think that it's hard, even with just the two of us running a company, it's hard.

Okay, okay. So the first thing I think you can do is: if you imagine there's like this kind of top-down version of creating values, theoretically from up here and everything I can see in my tower on high—here's what we value—and then if you imagine there's a version where you go down to all the people on the front lines and you observe every one of them for a month, let's say just theoretically, if this could happen, and you say, "Here's what I see about how we behave in the market, and what that tells me our values are based on our actions that our people take." That, to me, is a more accurate reflection of what your organization really values than the version you create from the tower up here on your leadership retreat.

I'm not saying that's the way that it should be. I just think that's the reality of how people interact with your company. And this intersects with brand as well, because to me, a brand should be an external reflection of your internal values. Your brand perception, regardless of what your brand guide says and your design standards and the fonts that you choose and all of this stuff—the brand perception that people have is going to be rooted in the actions your people are taking. So the way that your brand is defined in the market is reflective of the lived values of the people interacting with the market. So these are your real values.

So how do you close the gap was the original question. I just want to make sure I don't stray too far here.

Yes, the question was: how do you bridge that gap? How do you make it reality? So I think the first thing is acknowledging reality—acknowledging that the version of what's being lived out on the ground floor of your organization is step one.

Step two is making a conscious choice about letting go of things that are not actually true, that you wish were true, or as an alternative, making the hard choice to begin creating incentives for people to live out the things that you say matter to you that they haven't been living out.

So I'll give an example of this. At Kit, we hosted a conference called Crafting Commerce, and it was meant to be rooted in what we value as a company, reflective of the community that we serve, and very much not about attention on us. It was like, it's not meant to be a user conference. It's meant to be a conference for the people we serve supporting each other. I think we did a really good job of that.

And one of the things that we believed is the people we put on stage need to reflect the diversity of the community that we serve—the creator economy, which is everyone. There are creators from every walk of life. So as a bare minimum, as the curator of this thing, I was adamant we must have gender equity on stage. There must, at minimum, be half and half gender representation on this stage. And that's, you know—I don't want to get way off into a gender debate, but if we just take the kind of like, if there are two genders, that needs to be represented. If there are four genders, that needs to be represented. So just take me at face value on that one.

And this was not a statement we made. This wasn't like a thing that we said about ourselves. It was a thing that we acted on. And what we learned in the process of pursuing this was, because of the constraints that many of the folks in our audience had—just fact of the matter, data-driven—men we asked to come speak at the conference said yes at a rate of about: if we had to make 1.2 invites for every one yes, we got. Women we invited to come speak on stage said yes at a rate of about one for every two and a half invites we sent.

So it would be super easy to say, "Well, we sent 20 invites to men and 20 invites to women, and we got, you know, 18 men and nine women." That's not how that works. If that's what you value, you say, "Okay, so we have to invite twice the number of women to come speak if we want speakers representative of the community that we're trying to serve." And that's what we acted on. And every single year of that conference, if you go back and you look at the speaker page, there is half and half.

We've never said that from the stage. We've never said that as a statement anywhere, because it doesn't matter what the statement is. It matters: do people in the audience see someone on the stage that they can identify with? And there were a bunch of different versions of that, right? It's just like the easiest, most obvious one to state. But the question is: are you willing to make hard decisions and follow through on the things you say you value and then incentivize it for the people who are responsible for delivering on it?

And if the answer is no, then what you're implicitly already deciding is we don't actually value this. So you should make that explicit.

Awesome. Bear, as we wrap up here, we do something called uncensored question. A bit of rapid fire here, and I will take—

I'll do my best to comply.

I'll take one of Adam's questions just because he'll complain later on. One client decision you coach someone into that you wish you could take back.

So I had this moment—I've talked about this on Instagram as well—but I had this moment with a client where I was really pushing them on a performance issue with an employee of theirs. And they had been struggling with this for like a year and a half. And I really just went in on it in one session. I just said, "Look, you've been struggling with this person for a long time. You feel like you can't fulfill what it is you're here to do with them on your team. They're not giving you the support that you need. Why have you not fired them yet?"

And I went for tough love at a time where I think that the client needed to arrive at that conclusion on their own. And they let me know about that. They said, "I need you to drop this and not bring it up in that way again." And I felt really—

Had that conversation with some people.

Yeah. I appreciated that. You know, there was enough trust in the relationship that they felt like they could say that back to me, and I was grateful for that. But it was definitely one of those where I've debated ever since then: okay, was that the right move? And did it create the conditions for the client to get clear on what they thought and what they needed from me? Or was it actually me pushing too hard, and me having an agenda and a belief, rather than staying in the role of coach on that?

So that's one that I still kind of debate back and forth on.

I like it. Barrett, executive coaching.

Has no license, no board. I'll loosely say no consequence if it doesn't work, but the consequence is you get fired. You go find another client. What stopped you from being wrong about a client for a year and never finding out?

I don't know because it's likely that I wouldn't know if that was the case. But the way that I hold myself to a standard is I had this concern about the industry getting into it. It was like, man, this thing is unregulated. The reputation of the average coach is very poor. You tell someone you're a coach and they think, oh boy, here we go. Can't wait for this one.

And I really had some hang-ups about that. And so what I decided was I'm going to treat this—I guess I'm on a sports kick today. I'm going to treat this the way a professional athlete treats their craft. They train in the offseason like they've got skills to develop. They take it seriously. They show up and they hold their own standard for themselves regardless of what the team's doing. That's what the best athletes in the world do. I'm going to do that as a coach. I'm going to train every year. I'm going to build my skill set, my toolbox over and over again. And I'm just going to be so good in my seat and in my preparation that if something gets out of whack with the client, that's probably a personality issue or mismatched expectations or something like that, but it's not going to be because I didn't put my work in. And so that's been my approach. I don't know that that's the right approach, but I want to hold myself to such a high standard that a client like their standards can't possibly meet that.

I love that. That is so good. Well, as we wrap up, I'll give you a lob ball here. Dream vacation destination.

Oh, man. I've been really pining for Japan lately. I've never been to Japan. I feel like the culture of that country and just the aesthetic of the way Japanese society runs really appeals to me and my sensibility. So I really want to go to Kyoto. And there's a specific resort there called Aman Kyoto that is this beautifully curated spa. And I want to be there for like a week as home base and go out and do a bunch of excursions all around the country.

I'm just starting to plan Japan, so I've been hoarding points for a long time. And because everyone wants Japan, you literally have to book it like a year in advance.

Yeah.

But I want to do Kyoto, Tokyo. So yeah, I'm with you, man. It's become so popular. It's almost cost prohibitive now.

Yeah, for sure.

I wish I would have gone five years ago before everyone was like, "Let's go to Japan."

Before Instagram. 100%. 100%.

Barrett, thank you so much for joining the show, man. Where, other than LinkedIn, could people learn about you, your services? How do they get in touch and get some real coaching?

Yeah, best place to find me is barrettbrooks.com. I've got a newsletter there that I send out every week. It's my takeaways from my coaching sessions that people pay me a lot of money for, and I distill them down to leadership lessons that you can apply no matter your context.

I love that. I'm going to go sign up right now.

Love it.

Someone's going to coach you. Listen, it certainly isn't going to be you, so we'll take it wherever we could get it then.

Barrett, thanks for joining the show, man.

Thanks for having me, guys. Appreciate the banter too. It was fun.