On this episode Josh speaks with Paul Smith from LeadWithaStory.com. They discuss the types of stories business owners should be telling.
Paul Smith is one of the world’s leading experts in business storytelling.
He’s one of Inc. Magazine’s Top 100 Leadership Speakers of 2018, a storytelling coach, and bestselling author of the books The 10 Stories Great Leaders Tell, Sell with a Story, Lead with a Story, Parenting with a Story, and Four Days with Kenny Tedford.
He holds an MBA from the Wharton School, is a former consultant at Accenture, and former executive and 20-year veteran of The Procter & Gamble Company.
In today’s episode you will learn about:
- The stories great leaders tell
- Why stories are important
- Tips on how to lead with storytelling
- Examples about how you can actually operationalize stories
Narrator: Welcome to “Cracking the Cash Flow Code”, where you’ll learn what it takes to create enough cash to fill the four buckets of profit. You’ll learn what it takes to have enough cash for a great lifestyle, have enough cash for when an emergency strikes, fully fund a growth program and fund your retirement program. When you do this, you’ll have a sale ready company that will allow you to keep or sell your business. This allows you to do what you want with your business, when you want in the way you want.
In Cracking the Cash Flow code, we focus on the four areas of business that let you take your successful business and make it economically and personally sustainable. Your host, Josh Patrick, is going to help us through finding great thought leaders as well as providing insights he’s learned through his 40 years of owning, running, planning, and thinking about what it takes to make a successful business sustainable and allow you to be free of cash flow worries.
Josh: Hey, how are you? This is Josh Patrick. You’re at Cracking the Cash Flow Code. My guest today is Paul Smith. Paul has a company called leadwithastory.com. He has a new book which is the 10 Stories Great Leaders Tell. That’s where we’re going to start off our conversation today. Let’s bring Paul on.
Hey, Paul, how are you today?
Paul: Very good, Josh. Thanks for having me on.
Josh: My pleasure. I love the title of your book. By the way, I think it’s a great title. What are some of the 10 stories of great leaders tell and why are they important?
Paul: Yeah, so let me answer the second question first. I think stories are important because they’re just a more effective means of communication, especially leadership communication. The reason for that is that people don’t just make decisions logically and rationally. We were somehow wired that part of our brain makes the decisions for us in a more subconscious, emotional, reptilian part of our brain. Then our logical, rational brain kind of tries to make sense out of that later.
If you want to influence what people think and feel and do, in other words, leadership, you need to talk to both parts of the brain. Storytelling is a great vehicle for reaching the other part of the brain that our rational logical thought is not very good at reaching. That’s the main reason why, as far as what are the 10 stories. There are dozens and dozens of types of stories that I think leaders need to tell.
I cover many of them in some of my other books, but this book was intended to be a very short read. In fact, you could read the whole book in one hour. It’s intended to be an executive summary of the 10 most important types of stories that I think any leader needs to be able to tell. If you’d like me to indulge you, I can just tell you what the 10 are and kind of spoil some of the fun.
Josh: Let’s go through one at a time. Let’s hold discussion about each other if we can.
Paul: Let me lay out the 10 because I think it’ll paint a big picture for you. Then we can share an example of one or two if you’re interested, but here are the ten. The first four go together, because they’re about setting the direction for the organization. That’s where we came from. That’s a founding story, why we can’t stay there so that’s a case for change story, where we’re going, which is a vision story, and how we’re going to get there, which is a strategy story.
You can imagine if you’re a leader who can articulate those four stories, you can easily tell the organization where we came from, why we can’t stay there, where we’re going, and how we’re going to get there. That should make some sense so far.
Josh: Can I add a fifth story to that just because I think there’s a really important is who’s going to get us there? I have a thing called stage two decision processes we use with our clients. A piece that most people miss when they’re doing any sort of planning is who’s on the team, and why they’re on the team. Who’s going to get you there? I think those four make a whole lot of sense. I would just add, who’s going to get you there would be another good story to tell.
Paul: The way I do storytelling, that wouldn’t be a fifth story, but those would be the characters in the how we’re going to get their story? When you tell your story of how we’re going to get there, the people you’re thinking of that are going to do it will be the characters in the story. It wouldn’t be a separate story to tell you who’s going to get there. It is, those are the people in the story of how you’re going to get there.
The second four kind of go together as well, but they’re more about who we are as an organization. That’s what we believe. That’s a corporate values story, who we serve. That’s a customer story, a story about your customer so that people can have a visceral human understanding of who these people are, what we do for our customers. That’s kind of a classical sales story, basically a story about what we do that’s so awesome, and you should pay us money to do it. Then the eighth one is how we’re different from our competitors. I call that a marketing story because marketing is generally about differentiating yourself from your competitors.
Imagine you can tell those four stories. You can easily articulate who we are, who we serve, what we do for those people, and how we do that differently than our competitors. Does that make sense?
Josh: It makes sense. Where would, what problems do we sell fit? What story that fit into?
Paul: That’s a different story. That just didn’t make my list of Top 10. There are dozens of types of stories. I consider that a critical story in selling and marketing. My third book that we haven’t mentioned yet is selling with a story. I lay out 25 specific types of sales and marketing stories.
The problem we solve happens to be story number 13 in that list. Sales and marketing there’s just a much more detailed list of stories that they need that that one story in that list did not make my personal top 10, but it certainly could make your top 10. It’s certainly a story I think everybody should be able to tell.
Josh: Well, it’s a story. I mean, yes, it is a sales and marketing story, but it’s also an operation story because if the people in operations don’t know what problem we’re trying to solve for our customers, they’re likely to go off in a direction that’s not where I want them to go.
Paul: Yeah, that’s a good point.
Josh: In my experience, it’s really, really, really important to be telling everybody in your company and have them thoroughly understand what’s the big problem that we solve. It’s also why people do business with you.
Paul: I think that gets us to eight. There’s two more that made my top 10, but the last two are more personal to you, the leader. That’s why I lead the way I do. That’s a personal leadership philosophy story. Number 10 is why you should want to work here? Not you, but the person you’re talking to. That’s a recruiting story. I think those two stories are important for any leader to tell because every leader’s job is getting talented people to come into the organization and stay and follow your leadership.
That’s not just a job of HR, the recruiting department or whatever so those are my top 10. Like I said, they’re 25 different sales stories. I’ve got dozens of other types of leadership stories, but I kind of coalesced on those. If you wanted a place to start a most important 10 to start, start with those. That problem story would be very on one of my shortlist as well.
Josh: Relatively recently, I’ve learned when I recruit with values, I’m having much better pool who show up and want to work with us than if I talk about the job and not the values. I mean, here’s my experience is that I’m recruiting people in my company. This is what most companies do, they see, they write this laundry list which is 25, 30 to 50 items that you have to be able to do which are all technical skills. None of our activities are going to make you successful and none of them talk about the values of your company.
Now, in my experience, technical skills are just table stakes. You don’t have me. You can’t work here or for this job, but once they get to table stakes, that’s not what I’m hiring you for. I’d rather have somebody who is six or seven in technical skills and 10 in values versus somebody is nine or 10 in technical skills and six in values.
Paul: I agree.
Josh: Because I can teach up but I can’t change where you’re coming from. I need to have stories around that to exhibit that. I have a story I call the brilliant jerk, which is what you’re not supposed to do when you hire somebody. It is sort of something like, I’ve got this guy, I’ve hired them, and they’re a pain in the neck in the organization, but they’re absolutely brilliant at their job. This actually happens to me every single time I finally get around to doing something about their brilliant jerk. I will finally let the brilliant jerk go because it costs too much problems in your company. When I do it, I have a line outside my door saying, “What took you so long?”
Paul: I think we all know people like that.
Josh: Well, they exist in every company. I had 90 employees. You cannot have a competent 90 employees and not have at least one or two brilliant jerks running around or just play jerks. I mean, I’m going to be brilliant. They’re just jerks. It’s a high read error that we need to work on. Give me some examples about how you would actually operationalize these stories and use them and maybe giving an example for us what a story might sound like.
Paul: Let’s use the value stories since you brought it up. I think that is an important story for people to be able to tell. I’ll share an example from the company Walmart and then you tell me what values you learn from that story. This is back in the mid 1980s. Before that, in the state of Texas in the US, H-E-B grocery store was the largest retailer in the state until about the mid 1980s, that’s when Walmart became the biggest retailer in the state and everywhere else in the world, by the way.
What happened at that point in time is the CEO of H-E-B grocery retailers in Texas, a guy named Charles Butt grant’s owner, the founder of the company, literally called Sam Walton on the phone. Sam Walton, the CEO and founder of Walmart in Arkansas and said two things. First of all, congratulations, you’re now the largest retailer in the state of Texas. My family’s company has been for four decades so congratulations. Secondly, I’d love to know how you did it? I’d like to bring my leadership team to your headquarters, if you don’t mind on a learning mission, and you’re clearly doing something right. We just like to learn what it is.
Now, Sam Walton would have been well within his rights, of course, to tell the guy to like shove off. We’re competitors. I’m not going to teach you anything, but he didn’t. What he said was, “Well, I don’t know what I can teach you, but I’d be happy to try.” They made an appointment for all these executives to fly to Arkansas and meet him at a local Walmart store.
On the appointed day at the appointed hour, all these executives from H-E-B show up in suits and ties and start walking around looking for him. They find him at the end of this aisle. They start marching up the aisle. Sam sees them coming and he holds his hand up and he says, “Charles, hold on a minute there. I’m having a conversation with this young woman. I’ll be with you in a minute.” He’s talking to this young woman, a customer about ironing board covers, literally.
He’s telling him about all the different sizes and shapes and color patterns and price ranges and all this stuff and qualities. She eventually picks one and puts it in her bag and shoves off the register. He turns around Sam Walton turns around Charles Butt says, “Charles, did you know how many worn out ironing board covers around this country? We’re going to sell a million of them this month.
What can I teach you about retail?” As it knowing that he probably taught the guy more about retail in that 15 seconds than he really needed to know. Anyway, the point is, if you were a new hire at Walmart, and somebody told you that story, what lessons about company values would you have learned from that, Josh?
Josh: For me, I would learn that the customer comes first number one. Number two, I need to be listening to my customer about what they want and what problems were helping themselves.
Paul: That’s exactly what they would want you to learn from that story. If you and I spent 15 minutes on this, we’ve done cover three or four more, really meaningful company values that are embodied in that story which is a true story. If instead, I just gave you that list of, here our company’s 15 values and gave it to you, it would go into a file drawer and you’d never see it again.
That’s an example of a company values story because people don’t learn the company values from a list. They learn it from the behavior of leadership and the stories about the behavior of leadership. Because not everybody could be there in the room to witness that happen. There are millions of employees at Walmart and there was only maybe one or two of them who witnessed that. The stories you tell about those things are how you communicate company values through stories like that.
Josh: I have a story which I call the Tanya story. The Tanya story is about personal responsibility with somebody who’s working my commissary, who is showing absolutely no personal responsibility. In the course of a 10 minute conversation, I won’t tell it to you because it took too long and it’s too involved. But then, of course that 10 minute conversation, she went from being completely irresponsible to being responsible for that. It was one of the few times I’ve ever seen this happen, where her behavior change where she went from being one of our worst employees to being one of our best employees.
It was just basically about the story of the conversation that she and I had and how it started off really poorly ended up being actually a very satisfying thing. I have another story about recognition for employees are that I was walking through my office one day and my office manager says to me, he was my controller. He says, “Congratulations.” Okay, congratulations for what? He said, “Well, it’s my anniversary.” I said, “Well, gee, that’s great. How long have you been married for?” No, you idiot, is how long I’ve been working here for. It never occurred to me that people would think that their work anniversary was a big deal.
I went to ask the next two people I saw, they all knew when they started. We took advantage of that and started recognizing people on their anniversary, where I would have an all hands meeting. In front of everybody would tell them something nice that they’ve done that fit in with one of our values.
Now, two things came out of that. One was these people who’ve never gotten public recognition in their entire life or anything, so I meant a ton to them. The second thing was it, which was a byproduct, if I couldn’t think of something that was really magnificent that person had done over the last year, they probably shouldn’t have been the company. Those sorts of stories in my experience are just so powerful.
Paul: Yeah. True. Now, if you don’t mind, let me just respond to one of the things you said something to the effect of, well, I won’t tell you the whole story because it’s really involved. Part of what I teach people how to do is to tell stories in two to three minutes. You can believe it or not tell a pretty complicated story in two to three minutes if you know how to do it. I have a story structure I teach people how to use and they get very disciplined data, you can actually tell very complicated stories in two to three minutes around the office which makes them more powerful than a long drawn out 10 to 15 minute saga.
Josh: That actually is a two or three minutes story when I tell it, but it’s not going take two or three minutes to tell it. What would you do to make a long story, a two or three minute’s story?
Paul: The structure I teach people to use is to answer eight questions in telling your story from beginning to end. I’ll give you the eight questions and then I’ll show you how you take a long story and make it short. The eight questions are, first of all, why should I bother listening to the story? I, the person you’re talking to? Why should your audience listen to your story? You got to give them a reason upfront to listen. Once you’ve answered that question, you’ve kind of earned the right to answer the next five questions. Here those are, where and when did it take place? Who’s the main character and what did they want? What was the problem or opportunity they ran into? What did they do about it and how did it turn out in the end? That’s six questions.
The last two questions are, what did you learn from the story? What do you think I should go do now? That should be eight. If you’ve got a story and you’re answering all the eight questions, and it’s longer than it needs to be, what you do is you delete, obviously, details in the story. If you write down the answer to these eight questions in bullet point form, and you start deleting bullet points, you can do that until you’ve got a question that doesn’t have any answer to it and then you’ve deleted too much.
Go delete from somewhere else because if you delete some of the answer to any single question, well, now you have an incomplete story. When people just randomly start deleting things from the story until they get short enough, what typically happens is they end up deleting everything from question three and question seven and then it just it doesn’t make sense anymore. You need to smartly reduce your story to where there’s still at least some answer to each of the eight questions and now you have a short story, but it’s still a complete story.
Josh: That makes perfectly good sense to me. Let me ask you a question, this is something which is sort of one of my new things I’ve been spending a whole heck a lot of time on, which is the word vulnerability. I don’t believe leaders are nearly as vulnerable in their organizations as they should be. This is especially true in the origin stories that we tell about ourselves.
I did an experiment probably a year ago. I’ve always told us origin story about where I came from, and how I did and did about three minute’s story. I decided to make it into a five or six minute’s story and standing, talking about all the good things I did. I talked about all the bad things I did and what I learned from them along the way.
After the presentation, I had a whole bunch of people come up to me and said, “The fact that you told that story to beginning made me believe that I could do the stuff you were talking about, which is really unusual for me.” You have any thoughts around that?
Paul: I think it’s important for leaders to tell stories like that. I call them failure stories instead of vulnerable stories. It’s the same thing though. The reason I call them failure stories is because if you call it a vulnerability story, it seems to suggest that the only reason I’m telling you this story is to create some vulnerability so that you’ll like me. Point is, the way to be vulnerable is to tell a failure story, a story where you made a mistake and learn from it.
The reason you would tell that story is so that the people you’re telling the story to will be able to not have to make that same mistake themselves, because you’ve taught them through your own experience. You’re doing it for their benefit. I just want to make sure that people don’t think about it as vulnerability story because then it feels a little bit manipulative that I’m telling you this to curry favor.
I’m telling you this because I want you to have the benefit of my failure so that you don’t have to suffer it. The side effect of that is, is that they will appreciate you as a person and as a leader and it will endear you to them and all of those other ancillary benefits, but the primary purpose needs to be for their benefit, not yours.
Josh: I think that’s true with all communication, isn’t it?
Paul: Yeah, probably so. It should be for their benefit, not yours. I mean, everybody has a purpose to communicate. You have an idea you want to get across. It’s fair for that to be a valid objective in your conversation.
Josh: Yeah, my thought here is that I’m just thinking about this. It’s our first time, actually, is that, if I’m having a communication with you, and you don’t walk away with getting some value from it, I’m not sure you’re going to want to have another conversation with me.
Paul: Yeah, I think so. It’s just why and teaching people how to use storytelling. The first step is defining your objective. What do you want your audience to think, feel or do after hearing your story that they probably weren’t going to do otherwise? If that thing you want them to think, feel or do is only a value to you and if no value to them then you might want to think twice about your purpose and telling the story.
Josh: Yeah, that makes sense. We have just a minute or two left. Paul, if you were going to tell somebody one thing they should do, what would that one thing be?
Paul: I think it would be to study the art and science of storytelling, like you would any other business or leadership topic. If you knew that you weren’t very good at marketing, you would probably go study marketing. You’d read a book, you take a class, whatever. If you knew that your weakness in the business world was finance and accounting, you’d go study that aspect of business leadership.
Storytelling should be no different. It is a very powerful communication tool that most people assume you’re either born good at it or you’re not. It’s not the kind of skill you can go study. That’s just not true. Storytelling is an art. It’s more like music or dance or poetry. There are some people born with a better aptitude for it than others. If you’re not one of them, you could probably go take guitar lessons if you wanted to go learn to play the guitar. Think of storytelling same way. Go learn it like any other business skill, and you can master the skill.
Josh: Makes perfectly good sense. Paul, we’re out of time. If somebody was going to find you, how would they go about doing so?
Paul: Yeah, thanks. The best way is probably my website, which is leadwithastory.com.
Josh: Cool. I also have an offer for you, which is, I have an eBook I’ve written on what they call The Financial Freedom Project. What the Financial Freedom Project is is a strategy for you to become financially free from your business. It doesn’t mean you’re leaving your business. It doesn’t mean you’re selling your business, but it gives you a whole lot more options as you go along.
To get it, it’s really easy just go to our website, www.sustainablebusiness.co/freedom. You get a chance to download our eBook on that. You can read it. It will take you about 20 minutes and I bet you get some value from it. This is Josh Patrick. We’re with Paul Smith. You’re at Cracking the Cash Flow Code. Thanks a lot for stopping by. I hope to see you back here really soon.
Narrator: You’ve been listening to the “Cracking the Cash Flow Code” where we ask the question, “What would it take for your business to still be around a hundred years from now?”
If you’ve liked what you’ve heard and want more information, please contact Josh Patrick at 802-846-1264 extension 102. Or visit us on our website at www.sustainablebusiness.co. Or you can send Josh an email at firstname.lastname@example.org. Thanks for listening and we hope to see you at Cracking the Cash Flow Code in the near future.