EOS: Strengths and Weaknesses

So we're going to talk about some of the strengths and weaknesses of the business operating systems. And we're going to start out with EOS. And I started out with EOS because they are the category king of the business operating system. And some of what I say today might not make all the EOS integrators happy when I talk about some of the drawbacks of EOS.

But as someone who inherits a lot of EOS clients and has to remediate where they have sort of overused or EOS has outgrown its usefulness, there are some things that you find that it can do more effectively. In its effort to be simplistic and simple is a better way, simple to implement, which it is, and that's what is powerful about it. It leaves some analysis on the table when it comes to how your company is going to be different, where people need to be coached, how to use tools to make decisions more consistently. But, so first of all, kind of a quick and interesting thing, they really did do a good job of becoming the category king of the business operating system.

And a business operating system, You know, I've kind of tried to describe it differently, but the way I describe it is it's a series of rules, rules, goals, tools, roles, plans, results, and routines that drive people's strategy execution cash, helping companies scale faster, more profitably, and with less drama. That's a basic understanding of what an entrepreneurial or business operating system is. And they really have claimed most of the mindshare. They've created a whole ecosystem around the category of the entrepreneur or business operating system, and they are synonymous with that.

Now, and, and they've done a good job of creating kind of a cult. And any strategy that results in a cult is a good strategy. And you can see that in how they have, you know, created, you know, a great, not only a good, solid group of integrators, but how they have tried to sort of hide the outside world from them. And I say that in the nicest way possible.

I know some of the people at EOS, they're awesome, and I know a few of the integrators, but I know behind the scenes They're very, very concerned with keeping EOS pure, meaning don't introduce a lot of outside tools or systems. And, you know, I can conclude from that several things. One of the conclusions I can reach pretty quickly is that, you know, the more you learn about outside systems, the more often they're more effective integrators tend to become coaches, which is fundamentally a different thing. And real quick definition, I mean, integrators, they'll come in, they'll help you get basic systems set up and, you know, but it's very very sort of presentation focused most of the time.

And there are a few very good integrators that almost act like coaches. 100%, there are some of those, but more often than not, there's not a lot of time for discussion and team dynamics and the things that make coaching different than just implementation. And so what it does well though, what it does really, really well is it has a very simple but effective execution system. By execution, I mean there is a good focus on priorities, KPIs, and just some portion of communication rhythm.

And there is a gap there. We'll talk about it in a few minutes, but some portion of communication rhythm. And that's a very, very good thing for a company really early on, you know, under a million dollars, it's we have to, you know, we have a valuable product, we have a couple of the right people in the right seats, but we've got to get a few things right when it comes to just day-to-day execution. So we're not shooting ourselves in the foot.

So what are our priorities that keep us focused? What are the data that measures whether those priorities are effective or not, and do we have a communication cadence that makes sure we're driving toward completing those priorities that are helping us achieve these short and intermediate term goals? It's very, very good at that. It does in a very simple way help you identify who's responsible for what in the organization, basic accountability, function accountability, and from that, what are the basic KPIs for each role?

Very good at that. And I love some of the simplicity of some of their tools, like the Vision Traction Organizer, which is a basic planning tool set to each person and can be used throughout the organization. Awesome tool. I use a modified one to, you know, help a lot of cases, owners get aligned on what their goals and vision are for the company before we go in and do the, the more in-depth work with the leadership team.

The delegate and Elevate tool, it's awesome because it helps you understand what the strengths and, you know, take and Strengths and weaknesses, not weaknesses necessarily in a horrible way, but things people don't enjoy doing. It helps you understand what those are. In a lot of cases, if you do it in a team setting, you can trade off tasks so that people that are strong in one area can take on some tasks. Maybe someone isn't as strong as in another area.

That's really, really cool. It helps you evaluate whether you have the right team in a very simplistic way. Now, where it starts to have gaps, and you see this in companies, over a million dollars in top line. It's funny because I've coached some smaller entities in the past like that.

I coach a lot of companies that are mostly quite a bit bigger than that at this point. But coached some that were, you know, plus $1 million, they get into the three or $4 million range. And honestly, though, the problems were coming out at about $1 million in top line revenue with most of those organizations. And that is the lack of thorough analysis in EOS, the lack of thorough analysis of what is your differentiated strategy becomes a big problem.

Meaning they're not fighting to white space. Number two, there is sort of a fundamental misunderstanding of habit and routine with the OS. So one of the things they tried to sort of differentiate themselves on at a very tactical level was not using the daily huddle. And back when Vern Harnish, who wrote Rockefeller Habits, Mastering the Rockefeller Habits and Scaling Up, and Gina Wickman, who was doing the work with him, you know, they eventually split.

But back when that was taking place, you know, about, I believe early on, I could be wrong at this, I believe EOS had the huddle early on and then abandoned it over time. Here's the problem that you see in those organizations. So those that have not adopted the huddle, there is a pretty big gap in habit and routine. Meaning, yeah, they might have executed against a few priorities, they got pretty successful, but there were not teachable, repeatable systems set up in each department.

And I can see that because there is a lack of consistent or believable leading indicators in each department. And that is a direct result of not having a daily huddle. And the daily huddle creates consistency. And what it does is it creates new habit and new routine within each person.

And that little simple prep behavior that everyone does before they go into a daily huddle. Now, for those of you who don't know the daily huddle, it's a meeting that's designed to save you time during the rest of your day. You bring your stuffs to it, you knock things out right there with your team, you communicate for a handful of minutes, five to 10 minutes, if you've got a team of you know, eight should be so it's a minute a piece. So it should be eight minutes long.

It's a very short meeting. Where am I stuck? Where do I need your help today? Can I grab you out of the meeting for 2 seconds instead of 30 minutes later on and not interrupting you later in the day?

Is there, you know, am I I come in, I say if I'm behind on what one of the KPIs or critical KPIs that I own, key performance indicator, one of the metrics. And if I'm behind, what am I doing to catch up? And ultimately, what are the things that I'm working on tied to my priorities next 24 hours that I have to execute on that is the little prep behavior before that is helping you improve and get more systematic every day. It's also freeing up all the time through the rest of your day if you're using it correctly.

So what you see in these organizations is there's this fundamental gap in habit and routine that is resulting in a lack of consistent systems inside of the organizations that I end up taking over as a coach after they've gone through EOS. Then they do have some things down there. Do you understand like I said, basic priorities? They do have function accountability down.

They do have KPIs like outcome KPIs or lagging KPIs set up, but leading indicators aggregators can be very iffy. The other thing that's misunderstood is core values. And where you see, you know, EOS says hey, how between four and seven core values and the companies that have seven are not using it as a decision making tool. And that leads me to believe that EOS doesn't necessarily understand that core values are a decision making matrix.

Meaning that I am, I need to make decisions in order of the core values. What's the most important core value all the way to the least important core value. So for instance, a compass back in the day, a compass is a company I worked at in Florida that we have big University State Degree programs online ours were integrity, courtesy, quality and efficiency. And we had to make decisions in that order with integrity first, then with courtesy, then quality, then efficiency, all those things were helping us make consistent decisions, not only in what we did every day, but how we treated each other.

And you see there is a gap of that understanding of using core values as a decision making lens in a lot of EOS organizations. But they do have basic execution down. And again, the tool set, it's simple, the branding is elegant. I do like the 90.

io platform. It has a some strengths going for it. Absolutely. I use it for things.

I pull bits and pieces of it and use it with my clients consistently to accomplish certain things. To get owners on the same page, to use the delegate and elevate tool to pass off tasks. Their L10 meeting, I still believe is a great best practice. If it's used correctly, some people misuse the L10.

And they'll really focus on identify, discuss, solve on things that aren't priorities. But if you can get them to focus on priorities first, and I know EOS say, well, we do get them to focus on that, but a lot of them don't. We focus them on priorities first and where they are and their kpis associated with those, they're going to be far more successful. And then they can ids on the Tactical things.

So that's my review of EOS.