How to Cultivate a Growth Mindset?

Adam Cliffe: So, is the growth and the trajectory that you've had with 4Front®️️️️️️️️ and the learnings – obviously you're no stranger to an acquisition or two, you know, on that journey – was it a natural sort of transition or was it natural to pick up this additional sort of stream in terms of, like scaling or helping other businesses scale?

Drue Schofield: Yeah, yeah. So, I read the Scaling Up book by Verne Harnish, maybe six, seven years ago probably, and we started to adopt elements of that in 4Front®️️️️️️️️ Accountants, as it was to the point of running a one-page strategic plan to help build our strategy. Its strategy documents, probably the best strategy document out there, in my opinion, because it encapsulates everything on one.

So, for people that aren't aware, if you jump on Google and type in “one page plan”, hit the images on Google, you'll see what one of those things looks like and it covers your core values, your beliefs, all the really important stuff. You know, your priorities for you know five years, three years, one year, a theme, key numbers, all those kinds of things. So, great document. Yeah, so I'd sort of run that. I'd actually run a few of those kind of sessions with clients as well, in a probably a less structured way than I was happy with.

And then COVID sort of came along. I've been doing that for a little while. COVID came along and again another sort of maybe another entrepreneurial-type spark where I thought, well, you know, there's a big opportunity here to work with businesses in a much more deeper sort of nourishing way with this Scaling Up program, because there's going to be a time, I thought, where businesses may need to rebuild and really focus on strategy and not just operations and the doing it, doing it, doing it, and more working on their business and not in it.

So, I reached out to the Scaling Up people and said, look, “I want to become a certified coach.” And they said, “Yeah, fantastic, here's the program.” Again, I probably bit off a little bit more than I can chew. I don't know why I thought I'd have all this extra time in COVID, because I didn't, but it just felt like I did because I was at home more than I wasn't.

Adam Cliffe: Probably one of the busiest times of the year.

Drue Schofield: Yeah, absolutely, it was so. I was getting up literally at four in the morning doing a couple of hours study, because it's like a diploma in a lot of ways. There's a lot of study to do. It's all self-paced and you complete the activities and those kinds of things. But the Scaling Up organisation gives you a mentor and I had a really good mentor, and they mark you.

At the end of the day, they sign you off and they say, “Yeah, this guy or gal is going to be a great coach” or “No, actually I think they need to do a little bit more work here, here, and here.” So, I was very fortunate that they signed me off and I've developed a program within 4Front®️️️️️️️️ called our Go4Growth program, which you're familiar with.

Adam Cliffe: Of course, I am. I am indeed.

Drue Schofield: And it's all built on the Scaling Up methodology. A few departures from it not many, hardly at all, and the departures I do make are really more to bring it into the Australian context or the Australian small to medium business, SME context. But yeah, we stick pretty true to the book. It's fabulous. You know the Rockefeller habits, you know the face and pace, you know, the things you're familiar with. That's what clients experience when they enter that Go4Growth program.

Adam Cliffe: One of the striking things for me when I'm talking to clients or prospects is the lack of framework or scaling methodology, you know. You talk about strategy and stuff like that, and accountability, and when I'm talking to these businesses, it feels like they're spinning their wheels a bit, and finding it very hard to get a bit of traction, or their senior leadership team, if they even have one, is not very aligned. So, I find that whilst people like you and I are familiar with scaling and stuff, there's still quite a lot of businesses out there that aren't working to a framework or a methodology. Do you see that a lot in in what you do?

Drue Schofield: Yeah, yeah, we do, and I think the key difference our Go4Growth program has potentially over other similar programs or similar business coaches is, when I do work with businesses, I guess I'm talking the talk, but I've walked the walk already as well., so…

Adam Cliffe: Yeah, been there, done that.

Drue Schofield: Yeah, kind of been there, done that. Got a T-shirt. Plenty more to get, though, I love a wardrobe, but I'm a little while away from that, so that when people go through issues, I can kind of relate it to what I've gone through, not an egotistical way or a, you know, didactic way where I'm trying to teach someone something, necessarily, or saying, “Hey look, how good am I. I've already gone through this, and we overcame this problem.” More just to say, “Hey, guess what? I'm in business, just like you, I've gone through these as well. Here's something that might work.” Not “Here's something that will definitely work and if you don't do this, you're going to be a failure.” But “Here's an issue we faced and here's how we overcame it, and it took a little while, but we got success from that as a team.

Adam Cliffe: So, you know, with all that said, and you know you'd probably almost have to be living under a rock these days to not address, you know, the cost-of-living crisis that we've kind of been going through lately. How are you seeing that impact small to medium businesses in Australia?

Drue Schofield: It depends, Adam. It depends what industry you're in. If you're in retail, it's going to be tough and I'm starting to see those results now with some of our clients that are retail or have retail exposure their revenue's down, which means their profit's down. So, it's going to be tough. I'm not going to sit here and say, “I reckon it's going to be easy street.” It's going to be hard. I mean, whether you like it or not, I think Australia's in a recession.

Adam Cliffe: A big R word.

Drue Schofield: It is. It's a big R word and politicians, in my opinion, aren’t being brave enough to come out and say that. They're trying to make the problem go away by not facing it, and they're putting their head in the sand. And, as we know, in business and in life, ignoring a problem doesn't make it go away. It makes it worse.

So, yeah, I guess, if you're in retail, it's going to be tough. I mean it doesn't mean it's impossible, but it's going to be hard. I mean what got you here isn't going to get you there, which is something you've probably heard me say before, particularly in the Go4Growth context. Yeah, so it's going to be tough for those people.

Other businesses are going okay. Some businesses are doing fabulously well; others, you know, not so much. There's always a whole heap of factors why a business does well, or it does poorly. But a strong economy is usually like a rising tide. It usually lifts all boats. With a receding economy, which is what a recession is, some businesses are going to still go well, not as well. Some businesses are going to find it really tough, and a lot of businesses, unfortunately, are going to fall over.

Adam Cliffe: And what are your thoughts on the federal budget?

Drue Schofield: Personally, I think it's, from a business point of view, a disaster. That's what's close to my heart. That's small to medium business. There's nothing in there to inspire or to encourage growth or investment in your business. I mean the government did continue the $20,000 as an asset write-off, which was, I suppose, okay, but I mean $20,000 in the context of business these days, I mean it wouldn't fit this room out. It's a bit of, it's good, but I mean, okay, if you're going to buy some laptops and some monitors and other, you know, maybe some loose tools. That, in my opinion, is very focused on almost micro businesses, not small to medium businesses. If you're going to buy anything substantial in your business, it's more than likely going to be, or particularly for my clients, it's going to be over that $20,000. It's going to be, you know, a motor vehicle that can carry more than one ton, or it's going to be a crane, or an excavator or, you know, a yellow dog or something like that. It's definitely going to be over $20,000. So, I mean, outside of that there's really nothing. There's absolutely nothing in there.

I mean it's a budget that I think you all, we probably all, expected from the current government. You know, political leanings to one side. If you want an economy to grow and you want it to prosper, small businesses need to be at the front of mind, be the engine that makes the country move ahead. It's businesses like yours, Adam, and its businesses like mine at 4Front®️️️️️️️️, or ours at 4Front®️️️️️️️️. It's businesses like you know the one next door, the one down the road, the one you go past or the ones you drive past on your drive or on your commute in the bus every single day. That's what keeps the country going, not the big businesses.

Adam Cliffe: Yeah, and I think to make matters worse and maybe good, but depending on which way you look at it, is obviously a lot of hype and a lot of buzz around AI. Are you hearing anything within the clients you work with? Are they looking into it? If they are, where in their business?

Because I think a lot of small medium business owners really struggle with what AI is or potential use case within their industry. And a good point to that is recently, Clayton Utz, one of the big law firms in the country, recently signed a deal with Lexus AI and if you're unfamiliar with Lexus AI, as I was when it was announced, when I looked into it, it was pretty much like a ChatGPT for legal. So, I'm curious to see, like, have you had any chats with any of your clients or you know, other business owners, what they’re doing or what their thoughts and sentiments are around it?

Drue Schofield: Yeah, well, I'll go back and give you my opinion on artificial intelligence if you like. I'll start with a quote. There's a quote I really like. I think it might be Bill Gates, I think, or potentially it's not. I believe it's been attributed to him before, though, it's that: We overestimate what we'll do in two years. We underestimate what we can achieve in 10.

I think AI has got a pretty big story. It's got a long story to go. I don't think we're anywhere near where it's going to be. I think people are getting a little bit carried away with it at the moment, to be honest, to a degree and I sort of say that to a degree. I'm not saying that it's a fad. It's definitely not a fad. It's here to stay. anything that's, I mean human beings, rightly or wrongly, we're sort of lazy creatures in a lot of ways, so if we can find a piece of technology that's going to replace doing stuff for us, then, you know, collectively, as a race or as a species, we'll put effort, time, effort and energy into that, which is what AI is, artificial intelligence is doing. I mean, AI is not new. It's been around for 30 or 40 years, I think.

Adam Cliffe: I like your point about, you know, it didn't just start on a Wednesday a year ago, but it almost kind of did. Like with ChatGPT, like I think it was the quickest growing market of any technology tool that we've ever seen.

Drue Schofield: I think it entered the media on a Wednesday, yeah, and then we all started to know “Oh, what's AI? Oh, geez, this is great.” But it's been around for a long, long, long time. I think there was a time when IBM… Weren't IBM trying to use AI, I think, at one point, to create like a virtual medical GP, general practitioner type service? They may still be.

Adam Cliffe: Yeah, and like you look at chatbots back in the day like the old Ask Jeeves and stuff like that. So there have been elements of…

Drue Schofield: Yeah, Ask Jeeves. Yeah, that's right.

Adam Cliffe: I think there's been elements of AI, and I think when you wrap up machine learning and automation and that all under the AI umbrella, you can definitely track it back for quite a long time.

I think this AI, in terms of large language models and multi-modal models, is probably the next iteration of AI. That's been the major disruption and the biggest sort of mover and shaker in the industry your ChatGPT, your Open AI back end, you and your Microsoft Copilot. So, yeah, look, I see, and look, I probably get a bit of flak for this in my own industry, but one of the biggest disruptors I can probably see within the IT space is, it was funny because about 10 years ago you were told get a job in IT and be a programmer, you'll have a job for life. You know, it was a high reward, big demand and not, you know, not many sort of people could do it. So, a lot of people went into that and now I look at things like ChatGPT and Copilot and stuff being able to create code a lot better, more efficient. Look, it's still not there 100%, but, as you said, it's here to stay and it's not what it can do now. Where are we at in five years with it? Yeah, you know, those programmers I feel are probably going to be phased out.

Drue Schofield: I still think, look, I guess you could look at two things with AI, and this has got application through society, economies, everything, I suppose. On one hand, are we creating God with AI, and will it one day eclipse the human species? Probably, I don't know.

Adam Cliffe: I think there's been a few movies about that.

Drue Schofield: Yeah, there probably has been. Yeah, like I think iRobot and a few others. Um, or do we look at it positively and go “Well, this is just another tool that human beings have created that's going to make their life easier.” So, anything to do with information and data, ai is going to be fully across. Yeah, I still think a human being is going to want to talk to a human being and I'd like to think we've seen sort of a small microcosm or a small example of that with COVID, where we're all on Teams and now we're kind of on teams a little bit, but mostly people will still come to my office.

We had five meetings yesterday, all in person. I always offer clients Team meetings. I'm having a Teams meeting later today with a client. That particular client’s in North Queensland. They offered to fly down just for the meeting. So, people, human beings, are still going to want to interact and relate with human beings. And are you really going to trust what a machine tells you? I mean, is our generation, even the next generation and the generation after that, going to type a question in, Hi ChatGPT, what is this?” “This is that.” “Okay, thank you” and then they go and do that? I mean, I think we're a long way from that being a thing. And even when I use ChatGPT I like to think it probably helps me with 80% of the problem. But it's the 20% that I add, that I get paid for, if you like, or it's the 20% where my value is, because it's going to be pretty similar if five accountants asked ChatGPT the same thing. They're probably going to get five very similar answers. You know, if you've got a thermometer on your fridges and they have to stay under one degree, there could be a computer program that writes that…

Adam Cliffe: And that's all that automation type stuff.

Drue Schofield: …that sends you an alert to your phone that says, “Hey, someone's got to go and fix this fridge. It's gone to 1.3 degrees. That's not right. All the fruit's going to rot.” “Yeah, okay, cool, thanks.” Whereas once upon a time, there's someone standing there taking, measuring it every single morning.

Adam Cliffe: Yeah, and that'd be a good example of that sort of business automation.

Drue Schofield: Yeah. How do I spend forty thousand dollars on a sophisticated automation system once, instead of having to spend seventy or eighty thousand dollars every year for this one person to do that one thing?

Adam Cliffe: Correct, and I think you're right. I think it's that manufacturing and that assembly line type style businesses that are really getting there. Like I know one client in particular invested heavily in robotics for their manufacturing and costing them an arm and a leg, but they were able to retire a fair bit of workforce which, good-bad, you know…

Drue Schofield: That's just reality.

Adam Cliffe: It is, yep.

Drue Schofield: I reckon the one thing people miss with automation is, and I'll go back to that example that I just completely made up, which is probably not even real, but if you spend $40,000 on a sophisticated piece of computer programming or whatever it is, you like that automation piece and you're then, once, and maybe there's an ongoing maintenance fee of, say, $10,000 or $12,000 a year, whatever the number is, doesn't matter so let's say it's a $40,000 spend and then it's $10,000 a year after that. If that replaces someone on it, and it's probably to your point a little bit with your client, you said that replaced that headcount. Okay, we're still going to spend this amount of money. It's just going to cost us this for this and we’re going to allocate the rest to that. That’s the step I reckon people miss every time.

Because they’re all “Great, we're going to save this.” Okay. But are you, yes, you are theoretically going to save it, but are you physically going to take that money, that $6,000 every month, or that $5,000 every month that you're saving, carve that off somewhere and go and create some kind of reserve with that, and then what are you going to do with that money? Then, what are you going to do with that money? Where's that going to be invested? Are the owners going to take that, which you know they're quite rightly should? Are you going to increase the salaries of other key staff to recognise their talents, or is it just going to get absorbed in stuff?

Adam Cliffe: I just want to also ask, like what do you think's in store and I know this is a bit of a loaded question, but what's in store for businesses this next financial year? What do you see? Any trends, anything people should be mindful of, or they should take advantage of?

Drue Schofield: A couple of things. I mean it doesn't have to even be a huge thing. It can just be five things written down on paper. This year I will not do this. I will focus on customer experience. I will do this; I will do that. I will focus on customer experience, I will do this, I will do that, and then, you know, branch it out. I mean, do you remember the things we did, the quarterly priorities? I mean, you got so many things done. You get way more done than you think you're going to get because you write it down and you commit to it.

Adam Cliffe: Yep, you move the needle, and you get out of the operational dumpster fires, you know, which is in our industry, like in the services industry. It's the hardest thing.

Drue Schofield: But that's every business. As soon as you deal with people, there's going to be drama,

Adam Cliffe: Exactly.

Drue Schofield: Because we're not drones. We have families. We have thoughts. We have feelings. We have hopes and dreams, ideas, all those kinds of things, I mean. Then you go to work and go, “Oh no, ignore all that. Just do your job.”

Adam Cliffe: Yeah.

Drue Schofield: But you can't. It doesn't matter if you're the CEO or you're the graduate IT professional, like everyone's the same, and you've just got to be able to get your team aligned and focused on the strat plan. What's the plan? Communicate the plan. Articulate the vision. And then bring people along.

Adam Cliffe: And that's the thing, yeah, and a lot of those business owners, they find themselves in that visionary persona or that role that they're playing, but I feel like a lot of them fail to actually communicate that to the wider team.

Drue Schofield: But you can't ask employees to buy into something bigger than themselves if you haven't told them what that bigger than themselves thing is. Because they'll come to work. They'll do a great job. They'll have their own problems, their own issues. They'll do some really, really good work. They'll do some things they're disappointed in, but for the most part they'll be great. But that's all you'll get out of a staff member. If you explain, “Hey, this is what 4Front®️️️️️️️️ does. We're striving to be an integrated financial advisory business. this is the turnover we want to do. This is the impact we want to have, then you stay silent on that and then the team will then start to think back and go, “Okay, well, this is great. I want to be a part of this business. How can I be a positive impact on this?”

Adam Cliffe: Yeah, and in terms of, like, your Go4Growth program, it's facilitator-driven. Do you see benefits for that? Have you ever seen it done well without a facilitator, like a business owner sort of led?

Drue Schofield: Yeah, that does come up. I don't think you can run any kind of strategic planning process well without a facilitator. That's my opinion, reason being, if you're in the business, you know what internal, external factors are happening. So, if you're then bringing that to your strategic planning process or to your leadership team, by virtue of knowing that information, you're going to be softer, I think, as a facilitator on your staff and on your leadership team and on the strategic plan in general, and eventually you're going to accept mediocrity because you're not going to be able to get that cut through, whereas a facilitator can come in fresh, completely cold. They don't know what happened yesterday, last week, last month, last quarter. They don't even care. All they know is there's a strategic plan that a team's invested some time, money, effort and energy into, and certain things aren't being met. And there's a reason why, and they need to get to that reason, and I guess to add to that, there's a reason why, and they need to get to that reason, and I guess to add to that there's a reason why rugby league teams and football teams have, or sporting teams have a coach and there's a reason why the captain-coach kind of role doesn't work, because a captain you can't be captain and coach and be hard on your team members. It just doesn't work. Whereas a coach can come in and they can do that, I suppose. I mean that's my opinion. I think facilitator-led sessions work much better than people taking that and going, “Okay, great, we've got it from here,” and trying to run it themselves. I just don't think it works.

Adam Cliffe: So, it really drives that accountability piece?

Drue Schofield: Yeah, it does all come down to the big A word, accountability. Absolutely, I don't think you can have that accountability with your people because you'll naturally just be softer on them.

Adam Cliffe: Yeah, thanks, Drew. Those were some really good points. I think that's it so. Thanks so much for joining us today. I really appreciate you coming on and giving us those pearls of wisdom, mate.
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Drue Schofield: Mate, thank you, I really appreciate the opportunity.

Adam Cliffe: Not a problem.

Drue Schofield: Yeah, thank you.

Adam Cliffe: Thank you very much.