Why Great Businesses Are Built by Teams
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In this episode of On the Flywheel, I’m joined by Paul Herrerias, Founder and CEO of Herrerias & Associates. We talk about leadership, team building, and why strong businesses are built by teams—not individuals. Paul shares lessons from growing up in agriculture, his path through accounting and executive search, and what he’s learned about hiring, accountability, and building high-performing teams. We also discuss communication, culture, and the mindset leaders need to create long-term momentum.
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Takeaways
- Growing up in agriculture teaches responsibility, ownership, and value creation early in life.- Businesses are built by teams, not individuals or budgets alone.
- Great leaders understand themselves before they can effectively lead others.
- Hiring well requires understanding strategy, culture, momentum, and leadership style.
- How and why someone leaves a job reveals as much as why they joined it.
- High-performing teams address conflict directly and communicate constructively.
- Accountability—clear roles and expectations—is a defining trait of great CEOs.
- The difference between a group and a team is shared commitment and continuous improvement.
- Strong teams balance communication, commitment, and competency.
- An attitude of gratitude fuels leadership, resilience, and hope in organizations and communities.Chapters
00:00:00 Welcome to On the Flywheel00:01:30 Paul Herrerias’ Early Life & Agricultural Roots
00:05:30 FFA, 4-H, and Early Leadership Lessons
00:10:30 Education, Accounting, and the CPA Path
00:14:30 Why Teams Build Businesses (Not Individuals)
00:18:30 Executive Search & Understanding Team Fit
00:23:30 Interviewing for Self-Awareness and Values
00:28:30 Common Team Mistakes & The Role of Coaching
00:32:30 Accountability, Roles, and CEO Effectiveness
00:36:00 The Three C’s of High-Performing Teams
00:39:30 Groups vs. Teams & Continuous Improvement
00:42:30 Books, Leadership, Learning & Final Wisdom -
Paul K. Herrerias – https://www.herrerias.com/ | https://www.paulherrerias.com/
Jonathan Mahrt – LinkedIn | Instagram | Website -
Jonathan Mahrt (A):
This is on the Flywheel, a podcast where each week we talk to entrepreneurs and professionals about the practical things they do to build and keep momentum in their personal and professional lives. Hello and welcome to on the Flywheel. I'm your host, Jonathan Mart with Flywheel Consulting. And today I'm excited to have on the podcast Paul Herreras, founder and CEO of Herarius and Associates. Thank you for coming on today.
Paul Herrerias (B):
You say that. Well, my pleasure to be here, Jonathan. Thank you.
Jonathan Mahrt (A):
Thank you. So I'm excited to chat with you. We met recently, just recently, got introduced, had a great lunch together, and had a really interesting conversation. So I think it's going to be really productive today. What I ask all of my guests to start with is just kind of give us your life story, career story, just the abridged version of how you got to what you're doing today.
Paul Herrerias (B):
Abridged version.
Jonathan Mahrt (A):
Well, this is open format here. We can go as long on it as you like.
Paul Herrerias (B):
I just laugh because I know that you and I have chickens in common.
Jonathan Mahrt (A):
Yes, that's true.
Paul Herrerias (B):
Single cone white leghorn means something to both of us. Most of America doesn't get. I say that because I grew up in Sonoma county and my dad bought a farm in 1957, and he's still there. But his father started a poultry farm in Sebastopol, supposedly in 1916, back when that was the hot thing for the venture capitalists to do was invest in the poultry industry. And the Bay Area was the heartbeat of that and became the ag capital of the world 30 years later because of that. But growing up in a rural ag community, the values that were instilled in us was you put in the effort to get to the results that you want. So if you want something, find a way to get it. Create value, and that's the way you get things. But create value for yourself, create value for the family members are very important unit, and create value for your community. So those are all like three legs of the stool there that bonded everybody together. And you learned some really good lessons about relationships and what's important in life in that process. I was a good student in school. So in high school, when my counselor said, so what do you want to be when you grow up? I reflected on, well, let's see, I had a career in 4H and was a leadership and president of my chapter. I was active in the Future Farmers of America and was president of that and a lot of other deep activities that go into that with animal husbandry and production and ranch management and mechanics And a lot of competitions. So you're thrown into leadership roles and community development roles and competing at a pretty high level, state level in a lot of ways and helping each other. And one of the things that gave me the greatest satisfaction was helping a buddy of mine who said, I want to build my own business so that I could have a foundation so that I can propose to my girlfriend and have a family with her. And I thought, what a wonderful goal to have, so let me help you. So I scratched out a plan with him on how to build his own business and how to achieve his dreams. So my counselor said, what do you want to be when you grow up? I said, well, I'm taking math and physics and all that kind of stuff. I love that stuff. So I know doctor, lawyer, but secretly what I really want to do is help people build businesses that will then give you richer families and communities. And when I finally shared that with them, he said, okay, why don't you go to study business then? Okay. So I did that. And then in business school, they said, well, why don't you focus on accounting, which is the language of business, so that you can really help people build businesses with a solid foundation? Okay. And then when I was studying accounting, they said, well, if you study accounting, you really want to know the language, you should become a cpa. I'm like, okay. And then my counselor said, well, if you're going to be a cpa, you should go to work for one of the biggest CPA firms in the world, get good training. I said, okay. So I did. I ended up at Deloitte and I got my CPA license with them. And I was active in the Institute of Management Accountants and then with the California Society of CPAs after I got my license. And ultimately I became president of both of those organizations over a decade and two decades time. But along the way, I realized that being a cpa, working with companies was not the end game if I'm going to help people build businesses. Because businesses are more than just good budgets. And they're saying financial statements. It's a lot about the people. And so what I learned is budgets don't build businesses and entrepreneurs don't build businesses. Teams do. And I noticed a big variation in how well people manage the teams that led the businesses. And I said, if I'm going to help people build businesses, I need to unlock that. How do you work well with the teams? So fast forward, I was in executive search as a way to understand teams more. I made that transition, had an opportunity to become A partner in a search firm and I started coaching clients. Okay, now we've helped you recruit that CFO or CPA or head of sales or head of hr. How do you lead the team? You got the talent now, but what are you going to do with it? And that was the second half of my career was focusing on how do you really lead a high performing business team? And so I went back, I got a master's degree in organizational development with that theme central to everything. I did every paper and project and my thesis was all around how do you lead a high performing business team? And really came up with some, I thought pretty solid answers to those questions. And my thesis work validated the ideas that I had about a systemic approach to leading high performance business teams. So I went out and applied that. I tried to find clients that I could work with and worked with retail organization in Sonoma county and worked with a manufacturing firm in South Bay. Ended up winning a project with Internal Revenue Service to lead one of their self directed work team projects in San Francisco and really enjoyed that. And at the same time, I kept one leg into executive search and ultimately had a chance to build a search firm that could also do this organizational development consulting work and leadership coaching work. And so put those two together. And that was a good challenge. But I built a practice at 10 search consultants and staff here in San Francisco and Marin. And they got recruited by a global retained executive search firm to merge in be their San Francisco office and lead that office. So I did that for about 14 years, which had me traveling around the world to go to partner meetings and meet people. And that unlocked a lot of doors, learned a lot about business in other countries and cultures. But the essence of building teams for building businesses was the same everywhere we went. And business was a common language. You think about politics and you have preconceived conceptions of what it's like to be in the Czech Republic or Chile or Hong Kong, Moscow, Russia. I went to all these places and met my partners in all those places. And it's so much more fun to talk about business than politics.
Jonathan Mahrt (A):
I mean, I agree with that.
Paul Herrerias (B):
And you find out that every people are people everywhere, you know, so the elements of successful business were the same everywhere. And so it was fun. I chaired different committees for my organization. I led industry practice groups and functional groups for them. And then after 14 years, I decided, okay, let's back away from doing a lot of committee work, if you will, and get back to just really working with my clients. And so I morphed into helping a gentleman start a national search firm. And we did that for four years. Fascinating. You work with manufacturing, distribution, food production, healthcare, all these different industries. And the searches that we did ranged typically CEO, coo, cfo, kind of the main ones that I was focusing on. But sometimes you're head of hr, you're recruiting, head of sales, head of it, strategy, whatever role was really critical to the company at that point in time. And so it was typically the chief level people, but sometimes it was one level down as well to help them build out their teams. And then last year I decided to come back to Northern California, just focus here and continue to give back to the community, kind of like grandpa taught me. So I want to make that my key focus right now. But I'm still recruiting the people to the executive team and then coaching that team.
Jonathan Mahrt (A):
Okay, very cool. Well, that was very. You really walked us through it. So I want, I have, I made some notes here. I have some questions I want to touch on. I'm going to adjust your mic slightly and point it more towards you real quick. And then so I want to talk, I want to talk about growing up in ag, FFA 4h a little bit for a second because I think we actually took somewhat similar journeys in both, you know, growing up in agriculture on farms. Right. And I had an inkling that I probably would go back to the. Go back to the farm, but in the interim, I went and got a business degree and I went and worked for Ernst and Young for a couple years out of college. So kind of. And I was in FFA. I didn't do 4H, but. But that was more a function of just my parents being busy and not feeling like they had time to put me in 4H, amongst other things, I think. But I did do FFA. And so what, you touched on it a little bit in the beginning. But what do you feel like that foundation in agriculture prepared you for and taught you going into the world of business?
Paul Herrerias (B):
In summary, a lot like I mentioned earlier, you learn responsibility an early age. I mean, some of the things I remember going to my dad and saying as a young kid, I see all this activity going around me, I want to own a part of it. What part could be mine? Is it part of the gardening or is it part of the raising the animals or taking care of some of the chickens or sheep or cows? And so at about seven years old, he gave me a particular project. Okay, these are yours, These animals are yours. Take care of them. Excellent. Then when you're 10 years old, you get to join 4H. So I took all my birthday money and bought 25 baby chickens in a pullets white leghorns and started an egg production business. And that kind of grew and morphed and put sign out in the front, fresh farm eggs for sale and started building from there. And that allowed me to expand into buying some sheep and doing some purebred sheep and showing at the fairs. And then that allowed me to buy some a dairy cow dairy replacement heifer project. And so you learn that opportunity is always there. Don't wait for somebody to hand it to you, you go make it happen. That was part of the culture that has stuck with me throughout my career.
Jonathan Mahrt (A):
Yeah, I think farmers in my mind are the original entrepreneurs.
Paul Herrerias (B):
Right.
Jonathan Mahrt (A):
In some ways it goes way back. And so I think all farmers, at least successful ones, learn that you have to hustle to be successful. And it very much is like what you put into it is what you get out of it. And I think growing up in agriculture it's like on one hand sometimes I maybe resented like I never got an allowance as a kid. Right. Well that was because it was a privilege to live at home. Right. Like living at, living at, living at home is a privilege. That's just like, that's the. So therefore, you know, we provide for you. Part of it is just giving back to your, giving back to your family. Right. And then. But if I wanted money, I had to go work on the ranch. That was the only way I got money.
Paul Herrerias (B):
Amen.
Jonathan Mahrt (A):
Now not. And so like, not everyone has the opportunity to go like work on a farm. But I think, you know, their family doesn't own a farm so they can't just go work to earn money. But I think there's so much value like, like ag kids learn the value of hard work and in a way that you just don't that lots of kids, especially now as your, your generation still, I think lots of kids went and got jobs in high school. That's much less common now. And so that teaches you so much, just having to learn to work and to earn money as a kid.
Paul Herrerias (B):
No, that's a really good point, Jonathan. I remember in addition to my chores around the ranch and the house and I became foreman of our 10 acre ranch when I was 14 years old. So and I was driving the truck and the tractors at 14 and a half. You know, of course you can't go out on city streets, but you know, we had to do those things. In addition to that I took a job at a dairy helping to milk Cows for a little while because they needed the help. And so I'm like, okay, you know, be at the milking parlor at 6:00am I'm like, oh my God. You know, when you're a teenager, that hurt. Yeah.
Jonathan Mahrt (A):
That's early. Yeah.
Paul Herrerias (B):
You gotta be back at 2 o' clock through the second milking, you know. Oh, man. So you had to revolve your whole life around that and try to make it all work. But one of the things that that's really done for me is in running my business is you're willing to get in and do whatever it takes to get the job done. It's never what's not in my job description. That's not invented on a farm.
Jonathan Mahrt (A):
No, that's true.
Paul Herrerias (B):
I think you and I both shared experiences of there's some glory work and then there's some shoveling some chicken manure work that you just had to do. It was all part of the job. So you had to get physical as well as mental and you had to keep your positive attitude up every day. So it was a great way to learn that. And I'll just share. You talk about responsibility and buying animals and raising the animals and doing these things. I remember one time I was preparing a lamb for show at the fairs and so I had put them on the table to wash them and dock out the wool and make them look beautiful. And I got interrupted and I got called to the house. I'm like, you got to come to the house. It's an important phone call for you. So I'm like, okay, I'll leave the animal here. You stay here, don't go anywhere. You'll be just fine. I ran into the house, took the phone call and it turned out to be a long phone call and that was not so good because the lamb got tired, was just sitting waiting for me, and he tried to get out and he hung himself.
Jonathan Mahrt (A):
Oh, geez.
Paul Herrerias (B):
Yeah. And I came back. Oh my God. I had a dead animal there. Like, oh, it was all my fault.
Jonathan Mahrt (A):
Yeah, yeah. Sheep can get really skittish and lose their minds.
Paul Herrerias (B):
Yep. And when you realize that the, the, the life, the health and the well being of all these animals, it's. It's up to you, you know, their life is in your hands. That's a big lesson.
Jonathan Mahrt (A):
It is. Yeah. I think for all the parent, we don't need to belabor the point too much longer because we have a lot of things to talk about. But I think all parents should consider, even if they live in the middle of the city, Putting their kids in 4H. I think there's a lot of value to kids learning how to take care of animals. They learn where their food comes from. And then if you're lucky enough to go to a high school that has an FFA program, it's super valuable. I mean, that's one of the best things I did in high school is take FFA classes.
Paul Herrerias (B):
Yeah. So, yeah, you learn a lot about skills and self survival, but you also learn a lot about leadership. And I have to say, before H&FFA, I was thrown into leadership roles at a very young age. And so you kind of went, well, I guess this is the way life is going to be. So you stretch and you grow and you know, and I've been president of so many organizations since then because I was never afraid of taking on that responsibility.
Jonathan Mahrt (A):
Yeah. I think once again, yet another thing that is just so valuable. So the other thing I wanted to talk about. So how long were you at Deloitte for?
Paul Herrerias (B):
Just over two years.
Jonathan Mahrt (A):
Okay.
Paul Herrerias (B):
Okay.
Jonathan Mahrt (A):
Similar. I was around two years for Ernst and Young.
Paul Herrerias (B):
Which is what it takes to get your CPA license certified.
Jonathan Mahrt (A):
Yeah, I did not get my cpa, but yeah, but that's about as long as I made it. And I was like, this is not quite my thing, being in a huge company like this, amongst other things. So I want to talk. I think executive search is a really interesting, interesting topic because you've got to go out and understand the organization well, what they need, what the. You talked about teams, what the team needs. And then you've got to go and hone down an interview through an interview process alone, without ever having worked with these people. Try and find a good fit for that team. So can you tell me a little bit about that process and what you look for to try and make those connections?
Paul Herrerias (B):
I look for three things when I work with a new client. A company, a team, an ownership. Could be the board, could be investors, could be a founder, could be a professional CEO that's hiring me. But what I'm trying to understand is, number one, the strategy of the organization. What's our mission, vision, values, strategic objectives, how are we going to measure success? So that's the first thing. The second thing is understand the culture of the organization. What works here, what doesn't work here, what's holding this team together, the glue. So I'm looking for those kind of components as well. And the third thing that I'm looking for, I'll describe it as the momentum factor. Where is this company going? How fast is it going, how strongly do they believe in each other and try to get a feel for what type of person is going to come here with the idea that they're going to satisfy their career goals with this organization. And maybe I'll call out a fourth factor which is the leadership factor. It is part of culture perhaps, but the style of leadership is critical to helping me assess who's going to be a good fit for it. So I try to get a handle on all four of those things before I even build a search strategy. And then after that I'll make the first phone call to try to help find candidates.
Jonathan Mahrt (A):
Okay, are there like key questions or kinds of questions you ask people that like reveal a lot about if they're going to be a good fit or what kind of a person they are? Do you have some go tos? I mean, don't, you know, I don't want you to reveal too many trade secrets, of course. But I'm just curious, you know, as someone who's not good, as someone who is not if who feels like he's not that good at interviewing people when it comes to like hiring. I'm just kind of trying for this, for my own edification as much as anything else.
Paul Herrerias (B):
A couple things and some of these I learned the hard way and some of them I learned from mentors. But when I'm conducting an interview with a candidate for a potential job, I will allocate time to spend with that person. I'm not doing 1530 minute type things. I'm not filling out just a little checklist and go. But I'm really trying to get underneath all of that. So, you know, I like to say a resume is a two dimensional object. You know, people are three or four dimensional. So let's pull back the covers a little bit and talk to them about why did you go to work for this company and why did you leave? You learn just as much about why they left the organization as you do as to why they went there in the first place. So I'll do what we call the resume walk. Help me understand your progression, why you made these particular moves. And I'm looking for triggers. I'm looking for values, I'm looking for personal needs. So understanding why the left in an organization is a good insight to their needs. And you know, the old adage is you join an organization because of the company and you leave an organization because of the boss.
Jonathan Mahrt (A):
Yeah, I've heard that one before.
Paul Herrerias (B):
It's true. There's a lot of differences between going in and going Out. But you need to know both to understand a person. And then I built a model, a career planning model. And I have four pillars that I work on. And inside each of those four pillars is three, four, five elements. So there's a matrix of information that I'm trying to gather. And sometimes it's easy because the candidates know themselves and they've thought through it and they have a strategy to their career. If it feels like I'm struggling to get to know this person and their career path a little bit, maybe it's because they haven't thought it out, haven't figured it out. If you're trying to lead a business, you want to have really talented, top notch leaders. Those are the people that know themselves.
Jonathan Mahrt (A):
Okay, that was about to be my question.
Paul Herrerias (B):
In order to be a good leader, do you have to know yourself? Yes, sir. Physician, heal thyself. Right? Yeah. And some people you could tell have had a lot of coaching. They've spent a lot of time thinking about their career. They've been working on it. Other people, it's just a little bit more haphazard. And maybe they were lucky with some introductions and got off to a good start. You have to keep that going. And I meet people of all ages who have had the first time they've had to sit down and really plot out a resume, a search strategy and a cover letter and talk about, okay, what do you want, where you're going and what value do you bring to an organization? Which are some of the questions that I'm asking people as well. Talk about magic questions. One I like if I'm talking to somebody about their current position and maybe I'm recruiting them, but they weren't looking. But I'm calling them up and I'm saying, hey, I've got this opportunity over here. Is this something that we should be talking about? Is the timing right for you to possibly make a change? And I'll ask them what's working for you at your current company and they'll tell me what's important to them when they answer that question. And then I'll ask, if you could wave a magic wand and change anything about your current situation, what would you change?
Jonathan Mahrt (A):
That's very revealing. Yeah.
Paul Herrerias (B):
Now we're opening the door. And that's where I start getting a little bit of a crack in opening the door to find out how I can recruit this person.
Jonathan Mahrt (A):
Yeah, I think that's a really clever way to, to kind of like quickly get at the core of what kind of what makes a person tick. And what's working and what's not working. It's very insightful. So I want to talk about. Because you talked about, you bring a person in and then you help the team. So what do you see? Like, what are common trends that teams tend to get wrong?
Paul Herrerias (B):
That is a great question that a lot of teams should be asking themselves.
Jonathan Mahrt (A):
So maybe the first thing is they don't ask that question what they're. What they're doing wrong.
Paul Herrerias (B):
Right, Right. Well, and one of the things that I always call upon is that any athlete who's looking to improve has a coach. Any business that wants to improve should have a coach. It's so beneficial to have a third person, an objective, independent observer. Watch the team, see how they work together, check out the dynamics of it and be able to give them some feedback on that. So that's one thing. The second thing is teams and individuals on the. Teams need to have good skills at communications and conflict management. There's a lot of times when people get uncomfortable with somebody's behavior on the team and they don't know how to manage that. And it's both managing their own perceptions and observations and managing perhaps the other person's behaviors and working as a team to say, is this going to be a norm that we have this behavior or not? So you have to keep all three in mind. When you're in a situation where you're experiencing something that's not comfortable for you on the team, be sure to dig deeper. When you're in those moments, if there's something that frustrates you, maybe it's something that somebody else did, or maybe it's the way the team's behaving. Dig deeper. And to say, why? Why is that there's a value behind it? Because if you're getting frustrated with it, you're having an opinion. But there's also potentially a systemic issue going on that can be improved and fixed for everybody's benefit. So that's the other thing is learn to address the conflicts and learn how to communicate so that you can have a constructive conversation. And without it, the team's never going to get better. It'll never hit its top game. The only way to get to the top is by working through conflicts.
Jonathan Mahrt (A):
Yeah, I mean, that's tale as old as time. Right. It's just everyone. If you want a good marriage, what do you have to be? What do you have to work on? Communication. Right. Good friendships, good business. I mean, every. I guess it all comes down to people and relationships and in order, you know, conflict People, like you said, people are people everywhere. You're always going to have conflict at some point. It doesn't matter how much people like each other or how well they get along. At some point, especially in a work environment where there's a lot of external forces putting pressure on you, creating situations where stress can arrive and there's a lot of things outside of your control, conflict will happen. It's inevitable. So then how do you choose to deal with it? Do you ignore it, or do you try and talk about it and get better from it?
Paul Herrerias (B):
Correct. Yeah. And the way you talk about it, know how to do that constructively, you know, know how to approach somebody without putting them on the defensive right away. If you honor the objectives of the team and the values of the organization and the needs of the organization and put that at the top of your conversation, then you're going to have an easier time communicating with that person. So if you ask them, for example, to change a behavioral point, explain why it's in the best interest of the business or the best interest of the team for them to make that change, not just because you wanted it.
Jonathan Mahrt (A):
I think that's really important, to frame it in the context of the bigger picture that everyone's working towards. And it makes it less personal, too.
Paul Herrerias (B):
Exactly. There's another thing that answers your question, too. When you look at the CEOs, the leaders of the organization, we know we want somebody who can bring strategy, somebody who could lead the culture, somebody that can communicate well with the troops, but also can deal with the people on the outside, the customers and the vendors and stuff like that. The one thing that a lot of CEOs forget or don't do a good enough job in is holding everybody accountable for their role on the team, which means you have to have clear identification of what your role is. So have a good structure to the organization, good job descriptions, good communications around that, and then hold people to their jobs. If somebody's not holding up their end of the bargain, it impacts them, it impacts the CEO, but it impacts everybody else on the team. And if you allow that behavior to persist, that becomes the culture now of the organization. So holding people accountable to doing what they're supposed to do to help the company succeed is one of the key differentiators between an average CEO and a great CEO.
Jonathan Mahrt (A):
I think that's a really. I think that's a really interesting point, because I feel like when I. When I'm working with small business owners, that's probably one of the biggest issues is there's not Tends to be in the size of business I'm working with. There's not a lot of room for a bunch of layers of management. Right. And so I see owners get frustrated with people that are working for them that they feel aren't meeting expectations, but they don't really. They have not done a good job clearly defining that person's role and their expectations for that role. And so people get upset because. Because of that mismatch.
Paul Herrerias (B):
Right.
Jonathan Mahrt (A):
And so therefore, also the employee feels like, hey, why I'm working hard? Like, why are you on me about these things? Because. Because they don't. They don't have a clear idea of what they're supposed to be doing. Or it's kind of changing based on the day, what they're supposed to be doing and what the owner or the boss gets mad about.
Paul Herrerias (B):
No, that's very true. One of the things that I also emphasize is if you're going to be writing out the job descriptions and creating those roles, you don't necessarily have to do it. The owner or the CEO should have to do it all by themselves. The team should do that because the team is responsible for the end result. So let the team figure out what everybody's job descriptions are.
Jonathan Mahrt (A):
I think that's really. Yeah, no, I think have them take ownership and figure it out. And. And I think it's also the other thing that I've experienced leading teams when I was working in my family's business is that I think that I don't always realize how different or how narrow my perspective can be versus the people that I'm working with. And so they may. I see the world a certain way, and they may be coming at it from a completely different perspective. And then when we actually have a conversation around something, I'm like, oh, I would not have even felt that way. I never would have expected. There's no way in a million years my mind would have thought about that.
Paul Herrerias (B):
I'll give it a good example of that. Do you play the wordle game?
Jonathan Mahrt (A):
I have played it. It's been a while, but I have played wordle. Yes.
Paul Herrerias (B):
So it infected our household. So we've been playing the wordle game and the connections and the spelling bee, and we'll do these games individually, and then we'll come together and take the spelling bee, for example. I might get halfway through finding all the answers, but as soon as we get two or three of us together, boom. We could get all the way to geniuses on that thing in a short period of time. Why? Because we play off of each other. And we have this intelligence that's at a higher level, or the sum is.
Jonathan Mahrt (A):
Maybe greater than the parts.
Paul Herrerias (B):
Absolutely. So between two or three of us, we could accomplish something. It would have taken six of me to accomplish.
Jonathan Mahrt (A):
Or did I get that quote wrong? It's the whole is greater than the sum of the parts. I don't know what is that quote, but you know what I mean?
Paul Herrerias (B):
Exactly. There's synergy in there. Yeah, yeah. So, yeah. And again, when we're talking about the team and being responsible for. So I call it the structural component. You know, what are the job descriptions as part of what I call the structure of the organizations? If they take responsibility for the mission and output to the client, the team, whether they're in HR or finance or sales or marketing, they all know what everybody in the team's supposed to do. So there's value that they can bring to each of that when they challenge each other in their jobs. It's fantastic because it elevates what everybody can do within the organization. So tap into that. And I tell each of the chief executives that I work with, 75% of your job is going to be running your department, 25% is going to be running the company as the leadership team. So you have 25% of the responsibility for the success and failure of this organization across the top.
Jonathan Mahrt (A):
Yeah, no, I think that's a really good insight. So I want to now pivot to the other side of things and say, okay, other than communication, what do good teams get? Right.
Paul Herrerias (B):
Ah, yes. I'm going to call upon my three C's for that one.
Jonathan Mahrt (A):
Okay. I love a good, I don't know, acronym or what.
Paul Herrerias (B):
Yeah, good book written 30 years ago. Dr. Larson was doing his PhD thesis and he interviewed 50 different teams that had come up with some fantastic innovation. And it was quite a variety of things. I remember one of his teams was the team at McDonald's that came up with the McNuggets, for example, IBM, who came up with the first IBM PC. He worked with NASA, who had the teams that put a man on the moon. And so just a wide variety of teams. And he came back and he synthesized it and he said, well, there's eight things that seem to be in common behavior with all of these teams, and they boil down to three buckets. So one we talked about, which was communications. The second bucket was commitment. Everybody in the team was committed to the same goal, and it had a clear picture of what that goal was and put a lot of work into that constantly to Stay aligned together. And the third C was competency. And that goes back to the team taking responsibility for one another in the job descriptions again too. So it's up to the team to decide do we have the competency, do we amongst ourselves to achieve this mission to take that hill, and if not, what are we going to do about it? And don't wait for somebody else to tell you, but you know, go do it. Go hire a consultant, go take a class, go read a book. You know, what is it you need to do to fill that competency gap?
Jonathan Mahrt (A):
And that's the competency not of each individual, but rather the group as a whole.
Paul Herrerias (B):
The team as a whole.
Jonathan Mahrt (A):
Yeah, yeah, okay.
Paul Herrerias (B):
No.
Jonathan Mahrt (A):
I think that's super valuable way of looking at it. I mean, if everyone understands the goal and then is honest, you know, can communicate well with each other and then is honest about their ability to meet the goal, and if they do have a deficiency, then it's that, it's that assessment and then saying, okay, if there is a deficiency there, we got to go find a way to make up for that deficiency.
Paul Herrerias (B):
You know, there's a trap that a lot of small businesses fall into and that is that they don't give themselves time to have these conversations.
Jonathan Mahrt (A):
I couldn't agree more.
Paul Herrerias (B):
You know, and you mentioned a group a moment ago. Yeah, There's a difference between a group and a team.
Jonathan Mahrt (A):
Okay. Yeah, yeah, there's a big difference.
Paul Herrerias (B):
A lot of companies, it's a group, you know, we hired these individuals, they show up, they do their jobs, you know, But a team, the three Cs is the simplest way I can put it. You know, the team is one that refocuses constantly on what's our commitment, what are we committed to, what's our goal, what's our values here, what's our brand that we're committed to. Are we really doing it? Are we doing a good job with it? How can we get better? Yeah, keep asking that question. My continuous improvement question sets. So if the team. To move from a group to a team, it's the commitment to the goals and continuous improvement, the communications around it, having the time for it, and the competencies so that we can win. I have, as I mentioned, my master's thesis work. How do you lead a high performance business team? I came up with there are four elements to every organization. Any kind of organization has to have these four things. The first one is your purposing system. Why are we here? Mission, vision, values, that type of thing. Second one is our structural system. How do we Bring resources into the organization, how do we organize the organization and how do we interact with the outside environment as well. The third one is the operations side of the business, which is transformation, which is how do we bring input into the organization, transform it into something and then send it out.
Jonathan Mahrt (A):
Yeah.
Paul Herrerias (B):
And then the fourth system, and a lot of people forget this one, is the feedback system. And the feedback system is as important as the purpose, structure and organizations operation systems. When it comes to mission, vision, values, the question is, are we achieving that? Are we getting closer? Are we living our values while we're pursuing the goals? Structural system, are we being effective at this? How do we know? Have we stopped to think about, are we using the right recruiting systems? Do we have the right communication systems? Do we have the right capital structure in the organization? And then look at the operating systems. You have to ask yourself, are we efficient and are we effective? Those are the two big questions you want to constantly focus on with your transformation system.
Jonathan Mahrt (A):
I've found a lot of organizations that have found a way to be effective but not very efficient. And that's a lot of what I'm doing is helping people add on the efficient part of it. Right. Because you've found people. I found people like their businesses, especially when I'm working with multi generational family businesses, they've been successful, they found a thing that works, but lots of times they've landed on solutions from an operational perspective that get the work done, make sure there aren't mistakes, but can be very labor intensive or time intensive. And so that's one of the areas that I always talk to people about is the difference between effectiveness and efficiency because they are different.
Paul Herrerias (B):
And at the heart of that is innovation.
Jonathan Mahrt (A):
Yeah, absolutely.
Paul Herrerias (B):
Unfortunately, we in America are focused on innovation, so things get better and better and better so we can be more and more efficient all the time. And I know you do a lot of work kind of in the technology or IT information systems arenas that's constantly changing, improving and getting better and sometimes in ways that aren't relevant. So you have to know when to say no.
Jonathan Mahrt (A):
Absolutely, that's absolutely true.
Paul Herrerias (B):
Don't lose your focus, don't go down that rabbit hole. But let's take advantage of this innovation over here that does make life better for us or our customers or, you know, our animals or, you know, whatever we're working with.
Jonathan Mahrt (A):
Absolutely. Well, Paul, I could talk to you all day. We are like right on the edge of our time here. So I want to just ask you the final two questions. I ask all of my guests and one of them you may have already kind of answered, but the first one is, what is the book? A book or books that you've either, you know, you've gifted or that you've gifted the most to people or recommended the most?
Paul Herrerias (B):
I love that you're asking that question because I coach CFOs and COOs and CEOs in different formats, but across the board, that's something I ask as well. And readers are leaders, and leaders are readers.
Jonathan Mahrt (A):
Love that.
Paul Herrerias (B):
It's so important. So there have been many, many books that I have recommended. I gave a speech to a group of 50 CFOs in New York City from around the world, and I gave them my top 10 books for contemporary leadership and my top 10 books of all time, Self Development, Improvement that are timeless.
Jonathan Mahrt (A):
Well, maybe you can send us. I'd love to have that list.
Paul Herrerias (B):
If you look at small businesses, Patrick Lencioni's books are great. Very good. The Disciplines of a Team is a really good book. The E. Myth Revisited by Michael.
Jonathan Mahrt (A):
I know which. Yes, I know which one you're talking about. Yeah, it's a good one.
Paul Herrerias (B):
I had a slight hand in one of the chapters of that book.
Jonathan Mahrt (A):
Oh, that's very cool.
Paul Herrerias (B):
That was pretty cool. But it's also the e. Myth original. 10% of your time spent on your business and 90% of your time in your business. Sounds easy. Most of my clients can't even get 10%.
Jonathan Mahrt (A):
I agree. That's a whole conversation I have with people all the time. Absolutely. Once again, we could talk about that.
Paul Herrerias (B):
One for a while. Okay, now I'm gonna throw you a loop on this one. The next one's not a business book, but I highly recommend it as a leadership book. It's the Book of Joy by Archbishop Desmond Tutu and the Dalai Lama. They were interviewed for a week together and this book was a result of their time together.
Jonathan Mahrt (A):
Interesting.
Paul Herrerias (B):
And I would recommend, if you can do it, get the audiobook. Because you hear their voices. You hear them talking amongst each other. And of course, unfortunately, Archbishop Desmond Tutu is no longer with us. But that book really helps understand how to lead yourself and how to lead other people around you. The Book of Joy.
Jonathan Mahrt (A):
Okay, I love that kind of off the wall recommendation. I'm going to have to check that out. The final question is, if you could impart one piece of wisdom by putting it up on a billboard over the freeway, what would that be? Doesn't necessarily have to be business related. Could be wisdom of any kind, form or function.
Paul Herrerias (B):
Let me just share One that I've been working on a little bit more recently. And that is an attitude of gratitude is contagious.
Jonathan Mahrt (A):
That's a great one.
Paul Herrerias (B):
So important to be grateful because it's a source of happiness. It's hard to be happy if you're ungrateful. But once you are grateful, then it opens your mind up to, okay, this is. This is what I do have. This is what's working. And I'm grateful for that. It opens you up to positive relationships with the people around you. It opens you up to even more hope, but a healthy hope. Not a self destructive one, but a constructive one. It's like, I'm grateful for the opportunities. I'm grateful that I grew up on a farm and learned those lessons because I've never been in a situation in my life where I've been desperate in my career because I always know that there's opportunities. I just have to create them. And thinking back on it, somebody asked me this. I have worked on a salary W2. I've worked over 40 years and only three of them where I've received a W2.
Jonathan Mahrt (A):
Yeah.
Paul Herrerias (B):
And yet I think I've been successful in my career, my life and my businesses. And I've helped a lot of people along the way who've worked for Herrera Associates or my other firms that I've worked with. So I'm proud of that. It's not the path for everybody, but it certainly is a path for somebody who grew up on a farm here in Sonoma County.
Jonathan Mahrt (A):
Yes, once again, farmers are the original entrepreneurs. And I think once that's in your system, it's hard to get it out. I think that's a great insight. If you. I think not. This is one. This is another rabbit hole I could talk about a lot. But in the United States especially, we are. We don't realize how even some of the poorest among us are so spoiled compared to other people in the country. And that's something I have to keep in my mind, is that like, when I'm not where I want to be in my career, I still have to take it, take an assessment, take a step back and look around at what I have and be like, oh, I'm actually incredibly blessed in the grand scheme of things. Right. I really don't have anything. What I'm complaining about, like, is kind of in the grand scheme of things and what other people are struggling with. Absolutely absurd. And so I think that's really important is to be grateful. And then when you're grateful, people see that because the same way is like being miserable all the time also just makes people around you miserable. And so the end. That's true.
Paul Herrerias (B):
Your positive attitude is a gift that you give other people. You put words to that positive attitude, you build hope in the people around you. And that's part and parcel with my mission in life, to help people build businesses so that we could have better families and better communities. Hope is a key ingredient to that.
Jonathan Mahrt (A):
I love that. Well, Paul, thank you so much for your time. I appreciate it. Where can people find you online? What would you like to shout out?
Paul Herrerias (B):
Well, I'm on LinkedIn. I have over 10,000 followers on LinkedIn who have found me and invited me to connect. You could also go to my website, which is herreras.com. okay. H E R R E R I A S.com and it'll be in the.
Jonathan Mahrt (A):
Linked in the show notes, in the podcast, in the description on YouTube.
Paul Herrerias (B):
There you go. And there's information there on how to email me or contact as well.
Jonathan Mahrt (A):
Perfect. Well, thank you so much. And I am. Thank you.
Paul Herrerias (B):
This has been a lot of fun. You're a great interviewer. Thank you.
Jonathan Mahrt (A):
I appreciate that. It's been wonderful having you on. I'm your host, Jonathan Mart. You can find me at Flywheel Consulting Co. And we have another episode is in the can. Thank you.
Paul Herrerias (B):
Awesome. Thank you, Jonathan.