MSMP 76: Esbe Van Heerden on Operations
While we frequently talk to entrepreneurs on the Mads Singers Management Podcast, we also enjoy speaking with top leaders at companies. Today’s guest, Esbe Van Heerden of OnFolio, is one of those leaders. She’s spent five years building and running online businesses, with a heavy focus on operations.
Esbe started our discussion by explaining the challenges of rapid growth. In her case they went from five team members to 25, and from 25 assets under management to 52. That meant that as systems were developed, they sometimes had to be abandoned because they didn’t work at the new scale. But she was also constantly reminded that any system is better than no system.
I readily agreed, noting that the number one challenge I see in my personal coaching clients is a lack of willingness to trust the process. So many business owners are just looking to replicate themselves instead of putting in the hard work necessary to build a business, which means creating processes, delegating tasks, and trusting people.
Part of delegation is setting expectations, and Esbe shared that one of the areas that she’s recently improved in is setting expectations and KPIs for her team. Not only does this make them easier to manage, but it also makes it easier to let them go when they aren’t meeting those expectations.
If your staff is properly managed by clear expectations, that means it costs you less to deliver services, which is one part of raising profits. The second is making sure that you laser-focus on your niche, the one thing that you do really well. When you are laser-focused you can charge your clients more because you are going to be delivering a better quality of service.
This is a major mindset shift for entrepreneurs who must come to focus on the “one thing” mentality as opposed to the “cash grab” mentality. In the latter case, distractions disguised as revenue drag you away from building a sustainable business.
Sustainable businesses are kept that way by making sure you have the right clients. Esbe recently did an audit which led them to drop ⅓ of the clients in their portfolio, which, in classic fashion, were roughly the 20% sucking up 80% of the time of the company. While some of those clients were legacy clients, people who first helped the company get up and running, being in business often means making the tough, not the easy, decisions.
Esbe will often pause to think about what she wants to say, and I wish more people had this thoughtfulness instead of just rushing to answer questions. I think you’ll appreciate her answers and her way of answering.
Key Learning Points:
- Esbe talks about the challenges of a rapidly growing company - 2:30
- Esbe recounts the creation and evolution of the company wiki - 5:33
- Esbe shares her perspectives on the difference between management and operations - 11:40
- Mads warns about the frequent problem of owners bottlenecking their own businesses - 14:20
- Mads parses the difference between owning a business and owning a job - 19:46
- Mads shares the importance of shifting your mindset as a business owner away from a “cash grab” mentality - 21:37
- Mads argues for narrowing the scope of what you do - 23:07
- Esbe talks about dropping the bottom ⅓ of their clients to focus on the top ⅓ - 24:15
- Mads talks about the benefits of laser-focusing on your niche - 27:14
- Esbe notes that it’s easier to let people go when there are KPIs and expectations in place - 31:45
- Mads reminds us that we don’t know the quality of a plan until we execute it - 40:20
Connect with Esbe Van Heerden: