Transcript

 
Sigrun:
You’re listening to the Sigrun Show episode number 408. In this episode, I talk to Penny Zenker about how to become more productive by being profit focused. Welcome to the Sigrun Show. I’m your host Sigrun, creator of SOMBA, the MBA program for online entrepreneurs. With each episode, I’ll share with you inspiring case studies and interviews to help you achieve your dreams and turn your passion into profits. Thank you for spending time with me today. Building an online business takes time. I share with you proven strategies to help you get there faster. You’ll also learn how to master your mindset, uplevel your marketing, and succeed with masterminds. Today I speak with Penny Zenker. She’s an international speaker, business strategy coach and a bestselling author. Penny founded, developed, and sold a multimillion dollar business, managed business unit turnarounds at the world’s fourth largest market research company, and was a Tony Robbins business coach. Today she helps her clients cut through the clutter and focus on the most important areas to sustainably grow their business.
In this episode, we talk about how to become more productive by being more profit focused. Before we dive in, let’s talk about 2021. Before you know it, it will be January, 2021. And the question is, are you prepared? And are you making the most off the rest of the year? Do you have the right idea of clients? Do you have the right offers? And do you know how to make the right goal for your business? If you are unclear of any of these things then come and join us for a weekend bootcamp where you will actually create a new and exciting offer that is just perfect for your dream client, and one that you can start to sell even before the year is over. And as a bonus, we’ll also help you plan 2021. If you haven’t signed up yet, don’t miss out on this incredible opportunity, go to the shownotes@sigrun.com/408, where you can find the link to sign up for the live bootcamp this weekend, plus all the links to Penny Zenker.
I am excited to be here with Penny Zenker, a new friend, my new LinkedIn friend and podcast friend. We met recently on a huge virtual summit about sales and it caught my attention that Penny had lived in Zurich, Switzerland, so that was our common ground to get things going and getting to know each other. So welcome on the show, Penny.
Penny Zenker:
Hi, it’s great to be here.
Sigrun:
I saw you had been a TEDx speaker like myself, and your topic is all around productivity, but as you just explained to me before, there are so many different angles to productivity, but first, before we dive into the topic of this episode, I would love to know how come this is your topic? What were you doing before? What has led you to do this, what you do today?
Penny Zenker:
Right. There’s so many different aspects, I think that we all have something that keeps revealing itself over and over in our life, in different ways, and we see it as part of a string only after the fact, right? That we can go back. And I think it goes back as when I was 19 and my father had passed away in a sudden accident. And it was a huge moment in my life to really get clear on what’s important to me. And so I think it shifted my way of thinking for my whole life, I feel so grateful now that I had that lesson so early on in my life to be constantly shifting and saying, is this most important to me? And constantly stepping back and looking at, am I doing what brings me joy? Am I doing what is going to create the most profit, and the most benefit for me, for my time, my money and my energy.
And of course, it’s not like we get the blessing once and that’s it, we get it in lots of different contexts and lots of different ways. So when I built my technology business, and on the outside it looked great, we were growing multimillion dollar company, but I was burning myself out and I was burning everybody else out. So it was another opportunity and learning moment for me to step back and say, where am I getting caught in the weeds? And so constantly the Pareto principle of the 80 20 keeps coming up for me to say, are you focusing on the 20% that makes 80% of the difference?
Sigrun:
So what was your company, your previous company, what did you do there?
Penny Zenker:
It was called SmartMoves, and today it’s SmartMoves Coaching, so I kept the name, but I was a technology developer. So I loved, and still love, right? It’s also about productivity, I love to create solutions that help people to improve their process, and at the same time improve the value that they’re delivering to the customer. And so I did that through technology, right now I just do it in a different way, but I can’t help but bring a little technology to it because it’s in my blood, but that business was an application development company and I built it up to a multimillion dollar business and sold it to a public company.
Sigrun:
So you sold it and then you still kept the name, and what made you then, you sold it, what made you then go into coaching?
Penny Zenker:
Well, I got to a point, I went back to work for a large market research company and I loved it and was helping major turnarounds and things like that within the organization, but I was ready to start a family, and I could really see that I still had some struggles with that level of responsibility and my level of commitment, and I wanted my family to be my first commitment. And so for me to say, how do I organize myself and still help companies to grow and to thrive, but not be the one who’s ultimately responsible for it, then coaching was the ideal mix as I had more of an opportunity to work with different companies across different industries and at the same time be able to make my schedule a little bit more flexible so I could be a good mom.
Sigrun:
Yeah. I find, working with my clients, is that this is the biggest reason for most women to start their business. It’s not everyone is having kids, but it seems like that is a big turning point, or maybe it’s the second child or the third child and they want to do things differently. But yeah, it’s a big motivator for women to finally start their coaching business, or online business.
Penny Zenker:
Well, it makes sense. Right? Because we take action when the pressure is high enough, and when the desire is strong enough. And so that is a moment in our lives where we really, like when my father passed, to really decide what’s most important, and if flexibility and being able to have more time with your kids or having that flexibility, then that’s the ideal type of position to have your own business and be able to manage yourself like that.
Sigrun:
And did you immediately know what was your niche going to be, and who was going to be your ideal client, or did you have to navigate that a bit first?
Penny Zenker:
I think that it’s a constant process. I didn’t know at first, and it developed itself because one of the great things is success leave clues, so go back and look at who have your best clients been, what’s the profile of your best clients, and it’s not always the clients that are the biggest and have appearingly the most money, or the most brand recognized. And so it’s really important to go back and look at who brought you the most joy? Who did you enjoy and get results with, and what was… To break it down, I’m a huge start with the end and work your way backwards, re-engineer things. So, that’s a constant process. So you do that once, and I believe people should do that every couple of years because markets change, your experience changes, your desires change, and so your market may be changing as well.
Sigrun:
So what were you essentially helping them with? Was it directly productivity, or was it something else?
Penny Zenker:
Well, productivity is a broad category. And so my main thing around productivity, I think everybody has their twist, right? So my twist is thinking and acting more strategically, and that means it shows up in your leadership, where are you focused and how do you bring that across? It shows up in your business acumen, in your business model, and the type of partners that you choose. So I think it was always around being more strategic in how you think, and then how you execute.
Sigrun:
Yeah. And you say productivity is so faceted. Okay. Yeah. We know the 80 20 rule, but actually what we want to talk about here is how do you become more productive by focusing on profit first? What does that concept mean?
Penny Zenker:
Okay. Well, I want to bring you back to the 80 20 rule, right? And then tie that into profit for a second, because the 80 20 rule is telling us that there’s 20% that’s going to get us 80% of the result, right? And so it tells us other things as well in that relationship. But if we think about, I talk about the eight profit leavers, about how we can be more profitable, and we can talk about that in a couple of minutes and come back to that, but out of those profit leavers, 87% of those profit leavers have to do with our existing customers.
Sigrun:
Okay. So what does that mean?
Penny Zenker:
Right. What does that mean? Do I want to focus on where more of the profit is, and more of the opportunity is? Or do I want to focus on the smaller margin? I think I want to focus on the 87%, and then if I found the 20% within that 87%, the 20% that’s going to make the biggest difference so that I can narrow down and really focus, because if I focus on the whole 80% I might get nowhere, but if I take 20% of that knowing that, that’s the biggest opportunity and narrow that down, now I’m going to be able to really make some headway.
So, that’s why I just want to bring it back is that there’s a huge myth in the marketplace, and tell me if you agree with this, right? Is that it’s all about growth. It’s about growing your business, growth, growth, go out there, put in more lead generation, take out ads, do summits, and if you have an online business, a service business, right? These are some of the strategies that are out there that people are talking about and pushing people into this growth mindset, and so that’s the very first place that we have to start in my opinion, is it’s not about growth, because there’s good growth and there’s bad growth, right? And so good growth is profitable growth.
Sigrun:
Yeah. Yeah. Good growth is profitable growth, but I guess a lot of companies still start with less profit and eventually increase it, if you think of businesses like Facebook and others where you first focus on getting all your followers and then turn it around. Now, this is not applicable for all businesses, but often in, let’s say online business, it’s often about that pulling off followers and growing an email list, and it’s not profitable yet, but eventually you have to switch and you have to do it sooner than later of course.
Penny Zenker:
Well, and there’s a way to do both, right? So, that’s the common model is to build your followers and to hold off on making money for a period of time with the understanding that they will eventually turn into profitable customers, and maybe they do, and maybe they don’t.
Sigrun:
Yeah.
Penny Zenker:
And so, in my opinion, why can’t you build a list and be profitable at the same time?
Sigrun:
Or sell first without building the followers, like I suggest.
Penny Zenker:
Yeah. There’s other strategies, and so what I always say to people, I’m talking to somebody and they tell me that they’re doing this particular strategy, they’re going to run a summit. And I said, well, have you looked at how much time goes into it? Have you looked at how many people you’re going to attract? And have you looked at whether that’s really your ideal customer that you’re attracting? Because when I was speaking to this one particular person who did in-home fitness, and he was a personal trainer, he was actually not attracting the ideal audience for himself, he was going to spend a lot of time developing something that has a cost, right? We don’t want to discount the fact that our time has a cost, there’s an opportunity cost that we’re not spending it somewhere else that could be more profitable and could bring better results. But we forget about that. We forget about taking a look at well, what else could I be doing with this time, this money and this effort, and what could that develop into?
So I think we need to, again, coming back to that stepping back process, of stepping back and evaluating is this the 20%? or am I focused on the 80%, which is definitely going to get you there, but it’s going to take a lot longer, it’s going to take a lot more effort and it’s going to take a lot more money to do so?
Sigrun:
So when you say 87% of your clients, and then 20% of that, are you thinking of something like recurring revenue, or attracting more of those people that seem to be most profitable in your business, or you have most joy working with, or both?
Penny Zenker:
Yes, in a way, right? So the eight profit leavers, one of them is new lead development, and that’s the 13%, all the others revolve around your existing customers. So what that means is your existing customer has an average purchase price, for instance, with you. Well, so what could you do to increase the average purchase price? So, there’s opportunities there to raise your prices, or to bundle a package that has more than one service or product with it that, or partner with somebody, that is an ideal combination, so now they’re getting your service and product, but you get an affiliate commission from the other. So how can you increase that average purchase price? How can you increase the frequency? That’s what you were talking about, like a subscription, or something like that, where, okay, well, if they buy and they’re on a monthly program, could you interest them in something that is more frequent, every other week, right? That they’re getting it.
That’s why you go into Amazon now, and they want to put you onto the reorder this, so that you get it every two weeks. Hairdresser, for instance, right? If they don’t keep you on a five week cycle, you might go eight weeks before getting a haircut again. And now that’s business, in terms of that customer value, that’s being reduced. So by planning out the ideal frequence, showing the value of that, then you’re going to be able to increase the frequency.
Sigrun:
Yeah. So you started with the first profit lever was new leads, generate new leads.
Penny Zenker:
Then I said raise your average purchase price. And I said increase frequency, so then we would go into operational efficiencies, right? Where could you automate something so that the system will be able to take it from one end to another end.
Sigrun:
Mm-hmm (affirmative).
Penny Zenker:
So for instance, I have a dashboard that I created that helps somebody to really see what their best next steps are in these eight leavers, but it’s all automated, right? So now, instead of them having to meet with me, they can still do that, but then that’s an up-sale, which is another profit lever, right? But by automating it, I can reduce the cost that goes into it as an example, and there’s other ways to look at operational efficiencies. And then the next one, do you want me to go through all of them?
Sigrun:
Absolutely.
Penny Zenker:
The next one is extending the customer lifetime value, right? If your typical customer works with you for one year, how can you create a maintenance program, or something that keeps them in your world, and if they already know and love you, well, then they want to continue to know and love you. So find additional value that you can deliver them. And then the next one is enhancing customer loyalty is, forget the number but it’s over 50%, I think it’s something like 70% of our customers are leaving because they don’t think we care, because we’re not building that relationship. So by creating more interaction, by creating some rewards, right? And making raving fans, that’s going to affect other profit leavers too, they’re going to stay longer, they’re going to buy more. So that’s also an important lever that we want to work with.
And then the next one is boosting referrals. So even though it generates new leads, it’s doing it with our existing customers, and those people are four times more likely to buy, because they’ve been referred by someone that they know, like and trust. Right? So, you’re getting that credibility factor from the existing customers that you have. And then the last one is sales conversion. Is you already have a lead flow that’s coming in, but instead of investing the money in the conversion process, we’re investing the money in the new acquisition. We’re investing it in the lead flow, which is important, but it’s a part of an optimization strategy, right? To close more of what you have coming in and then amp up. Right? So everything is sequential, there’s an optimal sequence.
Sigrun:
Yeah. Everything is connected in some way. If you get more leads, increase your conversion, suddenly your business is a lot more profitable and maybe you’re spending the same with your marketing money to get them in the first place.
Penny Zenker:
Exactly. And that’s just working smarter, right?
Sigrun:
Yeah. But if someone looks at their day, let’s say you sit at your desk and now I want to start my day and I’ve decided, Oh, I want to become more profitable, or I want to be more productive by focusing on things that bring me profitable growth, should they be starting with this list right away, everyday? Or is this something that you say is more of a strategic thing that you do not on a daily basis?
Penny Zenker:
So the first thing to do is not all eight, right? Because that’s too much at once. So it’s to step back and to see which one has the greatest value for you right now, so pick one. And I have a daily strategy that I talk about in terms of productivity, because we’re all trying to balance urgency and importance, right? That whole Eisenhower matrix that Stephen Covey made also famous is how do we do it, in essence, do it all? So I have something called the one, three, five daily planning method, and I have journals that help you to do that, or easy worksheets, but it’s really simple, is you put one thing that your super profit move, or your legacy move, that everyday you’re doing one little step to move you forward towards a higher purpose, a greater legacy, or it might even be one of these profit leavers, one action everyday, moving that forward, and getting what needs to be in place in order to put it into place.
You can give it also then the next, the three, is the three major milestones that you’re working towards. That might also be one of these that you’re focused on, but it might be a particular client project, it might be a weight loss, or a health gain milestone that you have, right? But three things that you are dedicating time to bringing those three major milestones forward, and then five things that are absolutely urgent and must be done by you today. Right? And the key part there is, must be done by you, because we think that we make everything urgent, which it’s not, so we get to challenge the urgencies and say, is this really urgent? Is this really must it be done today? Absolutely, without a doubt must be done today. And then who else could do it? How else could this get done if I needed it done and I can’t do it?
Sigrun:
Yeah. And that’s how you get more productive everyday.
Penny Zenker:
That’s it, right? Is balance that and, Hey, if you get nine things done today that are in that process, in that structure, you feel good, you feel like you had a productive day, and it’s not to say you’re not going to get other things done, but you have that backup list. Right? Even Warren Buffet has two lists. He’s got the primary list where he has the top three things, and then he has the fall over list, which is everything else. So, that’s what we’re working with, is you still have the bigger list, but you’re working from the one, three, five everyday.
Sigrun:
I like that a lot. It reminds me a little bit of Eat That Frog! With Brian Tracy as well. And I use that in some of my coaching programs every week, what’s the frog of the week?
Penny Zenker:
Right. But doesn’t the frog mean the hardest thing?
Sigrun:
Yeah. I thought always [crosstalk 00:22:49]. Yeah. It’s the thing that you… Yeah, to bring an example, I think it’s always good to bring an example. So let’s say for instance, I want to write a book. Now I keep on procrastinating on it, and this is honest [crosstalk 00:23:02].
Penny Zenker:
Yeah.
Sigrun:
… my listeners know this, I keep on procrastinating writing this book because everything feels more urgent, more important, well, maybe not more important, but more urgent. But what if I would start the first hour of the day just writing, eventually it would get done, but it feels like, ah, okay, there’s always something else to do first. So I do think that frog concept helps many people.
Penny Zenker:
Yeah. So it’s that thing that they’re procrastinating on that’s important.
Sigrun:
Yeah. It’s like the legacy work, like you said, it’s that if at the end of the day after one year of doing it, what you just told us, what do you want to have finished?
Penny Zenker:
Are you saying me or?
Sigrun:
No. I mean with your method, you said first that legacy thing, because it feels like everyday it’s not important enough, but if you would actually think, like you said, with the end in mind, you know that you need to work on it everyday otherwise it’s never finished.
Penny Zenker:
And it can be a tiny little step. Right? Or it’s giving it some focus, maybe it’s planning for the week, and what you’re going to do for the week for that, but you don’t actually work on it that day, you work on it the next day based on your plan, but the thing is, is you’re giving it focus. And just about the frog thing is the thing is how do you feel about Eat That Frog, a frog, I still don’t feel good about it, but if I think about my legacy move, right? So writing my book, the productivity zone, I also did it. My kids were young and I did it, and I woke up before they were up and I wrote, and I did it after they went to bed.
And then I also hired people to help me to move it forward in between, but what drove me was this was my legacy, right? Is a book is a way to create a legacy and to reach a lot more people. So it’s finding the energy that helps you tap into and connect to why it’s so important, and what will be different for you when you work on it and you continue giving that a priority. And then of course, if it’s in your daily process, right? Then you can’t not look at it because it’s number one is what am I doing today to move this project forward.
Sigrun:
So tell us about the book. Tell us [crosstalk 00:25:29].
Penny Zenker:
So if you’re still procrastinating, then you need to do that.
Sigrun:
I am. I am. I’m still procrastinating. I always find so important projects to do instead.
Penny Zenker:
I hear you.
Sigrun:
So I want to hear about your book, what’s in the book, obviously the profit leavers, right? But [crosstalk 00:25:47].
Penny Zenker:
Actually the profit leavers are not in this book.
Sigrun:
Oh, okay.
Penny Zenker:
So this book talks about the behaviors that we need overall for success. So the productivity zone is where we’re efficient and effective, and it talks about the fundamental success behaviors in three different categories that get us in what I call the zone, and thinking and acting more strategically, and then the profit leavers come into some of those categories, but it would be a 500 page book, right? If I put everything in it. But it talks about these 10 drivers in the areas of mindset so that we’re creating the right mindset, and if you’re looking at a whole organization, it would be culture, right? Because it’s mindset of the organization. So it’s mindset, then it’s strategies, and that would probably be these are practical strategies to look at. And there’s three drivers under that, and then there’s sustainability, because we don’t want to just have a blip up of success. Right? That’s that growth without profit.
So we need to be able to know what high level things to focus on, and there’s an assessment that I have that people can also get with an app that I have that’s available, that helps us to track this over time. Am I motivated? For instance, with your book, right? You take a major goal, and you say, okay, I want to write this book. And then you say, okay, well what’s my level of motivation? And on a scale from 1 to 10, and motivation is the first driver. And if your motivation is a six or seven, so then we have to connect to, and understand based on where you are in each of these drivers, which one is the most important to tweak first so that all the others will move. Right? So they’re all connected, like we said with eight leavers as well. So that’s what the book is, and it talks about my personal and practical experiences through my business and also through my personal life. So some people can relate it to their situations.
Sigrun:
Yeah. We’ll definitely hook that up in the show notes, but I found it interesting, the motivation, and I was like, Hmm, I don’t know. I have a form when people apply to work with me and there is a last question, how motivated are you to achieve success, or something like that? I don’t remember the question exactly [crosstalk 00:28:05].
Penny Zenker:
Right, because it’s important.
Sigrun:
And if people do not put a 10, I’m like they are applying to work with me and they have to make a substantial investment and then they put something lower than 10 and I’m like, this is not going to go well.
Penny Zenker:
Well, and it could be that because they’re getting that accountability that’s the motivation they need, right? To see it through. So it depends on somebody’s thought process.
Sigrun:
I think could also be that you don’t have that belief in yourself yet. Could that be, that you just don’t believe that you’ll get it done, or that success is for you?
Penny Zenker:
Right. Right. Are you talking to yourself?
Sigrun:
I think so. This is turning into a coaching call.
Penny Zenker:
You’ll actually like the framework that I have in there, the productivity zone framework, because it talks about the balance, because when you’re not in the zone, you’re either a procrastinator procrastinating, right? So back to that term procrastination, or you’re perfecting, you’re in perfectionism or overfunctioning, and I tend to be on that side, the perfectionist that is trying to do one more thing, or just micromanagement was a huge issue for me when I had my company and I was growing in the IT world. And so it’s just seeing which behaviors also keep us off-kilter.
Sigrun:
Isn’t perfectionism something that seems to be with women more than men?
Penny Zenker:
You know what? I find a lot men find themselves falling into that as well because through my experience and looking at it, is control is one aspect of perfectionism, and so men and women want to control a situation, want to control people where that doesn’t work at all. So when we can control a process, but we can’t control people. So we need to think about that, but I do think that there is a tendency for women to be in that perfection area as well. But I don’t see at the moment with who I’ve seen come through that it’s more actually, it just shows up differently, that’s how I would say is, is women do have a tendency to be there because of the imposter theory, right? Is a lot of more women than men experience the imposter theory where they’re working three times as hard because they don’t feel like they deserve it, or it’s just a fluke, right? Their successes is just a fluke and they’re constantly trying overworking and overfunctioning to cover up, even though that’s not the truth.
Sigrun:
Yeah. I guess that’s why I feel it’s more connected to women than men because of that. And also the lower confidence levels generally in their own abilities. And we know a man will apply for a job if he has 60% off of the things that are needed for the job, and a woman will only apply if she is hundred percent, has everything, can tick in every box.
Penny Zenker:
That’s interesting.
Sigrun:
Yeah.
Penny Zenker:
I would apply. I would apply even if I didn’t [crosstalk 00:31:21].
Sigrun:
Me too. I called up and said, I want to be CEO of a company without business experience and business education. So I know I’m willing to behave a little bit like that without having all the qualifications, but does that tie into [crosstalk 00:31:36].
Penny Zenker:
That’s very un-European of you.
Sigrun:
Yeah. Well, in Iceland we are different. We don’t care so much about hierarchy, or even if you have a PhD, we’d never call anyone a doctor of anything.
Penny Zenker:
Oh, really. Okay.
Sigrun:
No. And we use first names, we don’t [crosstalk 00:31:52].
Penny Zenker:
Very humble.
Sigrun:
Yeah. We don’t use last names and we don’t really care about all the degrees people have done and things like that. So it’s a little bit easier, but this productivity has anything to do with confidence.
Penny Zenker:
Absolutely. I think everything has to… Success in general has to do with confidence. So, that’s a really good question. I believe that when you think of productivity, one of the key things that helps us to be more productive is structure. And if you think about it, structure also gives us more confidence. So, I’ve never really talked about this or thought about this, so I’m just winging it here, but I believe, there are a lot of different connections with that and how through different techniques we can gain more confidence. So like I talked about, or you said earlier, motivation, a reason could be is that somebody doesn’t have the mindset that they are going to be successful in that area, and so therefore then the wane down their motivation, and it’s not as high because they don’t see themselves crossing the finish line.
So different techniques can help you to boost your confidence in that context and see yourself at the finish line that will then increase your motivation, which will then increase your ability to get past obstacles, which will increase your ability to succeed. So as a result, I do think that that’s definitely a major thing.
Sigrun:
So how do people find you online Penny?
Penny Zenker:
Well, they can go to my speaker website, Pennyzenker360.com, and there I have different pages that they can take a look at. There’s a page around the productivity zone. I have a podcast they can check out, it’s called Take Back Time, and other clips and links to YouTube and some videos that I have and things like that. It’s the central location.
Sigrun:
Fabulous. Penny, it’s been wonderful to connect. I’m so glad we met at that virtual summit the other day, and we saw that connection, TEDx and Zurich, And I have now a few thoughts about my book.
Penny Zenker:
Excellent. Well, I would love to put together for the show notes, you could include a link, I’ll be happy to give people the one, three, five worksheet or-.
Sigrun:
Absolutely, let’s include that. Yeah. Let’s make sure everyone who has listened to this episode becomes a bit more productive and thinks more about profitable growth. Thank you so much for joining the show today, Penny.
Penny Zenker:
Thank you.
Sigrun:
Are you signed up for the live bootcamp this weekend? If not, then go to the shownotes@sigrun.com/408, where you can find the link to sign up for the bootcamp, create your recession-proof offer in a weekend. There, in the show notes, you will also find all the links to Penny Zenker. Thank you for listening to the Sigrun Show. Did you enjoy this episode? Let me know that you listened by tagging me in your Insta story, Instagram posts using my handle Sigruncom, and the hashtag Sigrun Show. See you in the next episode.