← The Duct Tape Marketing Podcast
The Duct Tape Marketing Podcast
How Businesses Can Thrive in Uncertain Times
00:22:57
Apply the 80/20 rule to scale, maximize profits, and lead your business through uncertain times.
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- [00:01]
Marketing Expert
Let me ask you a few things. Do you feel like you know what differentiates your business from every other business out there? Can you confidently charge a premium for what you offer? Are you working from a plan, a marketing roadmap that allows you to know precisely what to do next? Look, don't worry if you can't answer yes to any or all of these questions. You're not alone. See, marketers today get so focused on the tactic of the week staring them right in the face that they forget to look at the big picture, the overarching strategy needed to consistently grow their business. Over the years, I've worked with thousands of businesses helping them do just that. Create the perfect marketing strategy and plan that gives total clarity about what to do next, confidence to charge ahead and charge more, and complete control of the marketing tactics they choose. I would love to help you and your team do the same. Look to find out if our Strategy first program is right for you. Visit DTM World Grow and request a free consultation. That's DTM World Grow.
- [01:20]
Jon Jantz
Hello, and welcome to another episode of the Duct Tape Marketing podcast. This is Jon Jantz, and my guest today is Bill Kennedy. He is a seasoned global business executive and with 30 plus years of leadership in industrial and consumer markets, as chairman of OTC Industrial Technologies and CEO of Arrowhead Engineering Products, he has driven significant revenue and profit growth. He's passionate about business strategy and founded the 8020 Institute to help companies scale profitably. We're going to talk about his latest book called From Panic to Profit. Uncover value, boost revenue and grow your business with the 8020 principles. So, Bill, welcome to the show.
- [02:01]
Bill Kennedy
Hey, it's great to be here, John. And you're a fantastic hype guy. So I should.
- [02:06]
Jon Jantz
I'm just reading.
- [02:07]
Marketing Expert
I'm just reading what you gave me.
- [02:08]
Jon Jantz
So.
- [02:09]
Bill Kennedy
You did perfect.
- [02:11]
Jon Jantz
All right. So. So I like to sometimes start with words that are in the topic or the title of a book. So what does panic mode generally look like for a business?
- [02:21]
Bill Kennedy
Yeah, you know, that's. That's a really interesting question. And, and if you think of the scale from your your house is on fire and your boat is sinking to, hey, maybe you're just not making enough money, right? But a lot of times it's. It's situational and companies are looking out and they cannot figure it out. And in today's world, what that means is interest rates have gone up, can't cover your debt, cash is not coming in the pace you need.
- [02:45]
Jon Jantz
You know, I probably wasn't going to go here first, but I think I will now, since we talked about. I'm talking to a lot of business owners that in 2025, even if business seems okay, are, Are feeling a little panic of uncertainty. Like change is happening faster than anyone can keep up with it. And of course, you know, we could unpack the whole political scene. You know, that is causing a lot of disruption as well. So is, is, is, can panic mode actually be.
- [03:15]
Marketing Expert
I just don't know.
- [03:16]
Bill Kennedy
I think for most of it, it really is that, you know, being a CEO or an owner or founder, you know, I, I've heard other people use this. So this is nothing original for you. It's like staring in the abyss, but having someone throw rocks out of it that you can't see them coming and chewing glass from time to time. So, yeah, when you're, when you're in this chair, no decisions that you get to make are the easy ones. All the fun stuff like where we're going to dinner and how big a bonus to give someone else makes those. Right? It's, it's the. I'm not sure what to do next. That's what arrives here and today. Maybe it's always been this way, I don't know. But it moves so fast, right? Whether it's a tariff that's in or out, whether it's a interest rate that's going up or down, you think you're going left. You really, maybe you're going right. Perhaps you're not even sure. So it's the lack of control that causes us staying awake at night.
- [04:07]
Jon Jantz
You know, I know a lot of business owners, leaders of organizations feel that part of their job is to exude the posture and the, you know, everything's going to be just fine, you know, for the team. But when you're in panic mode, how do you do that?
- [04:21]
Bill Kennedy
It's an interesting piece. So I, I kind of go the opposite. Not, not like I, I don't know what I'm doing, but more about the unvarnished truth. This is where we are. It's what we're facing. However, we have a, a plan to deal with this. And, and our plan deals with, understand where we're going because our destination hasn't changed. But, you know, like, use a sailing metaphor, sometimes the wind blows from the left, sometimes it's from the right. We have to be able to deal with that. And, and, and that's really what the book is about. It's, how do you actually get through it? What's the simple basic stuff that you need to do? And, and Most your money, most all the good stuff comes from just a few pieces of that. So having a destination, being able to articulate, that's what people want.
- [05:04]
Jon Jantz
This might be a good time to visit one of the principles in the book you talk about, the Stockdale Paradox. I think that's a little bit of what you described there. Lot of listeners may have encountered that. The first time I've heard that term was maybe in Jim Collins work. I don't know if he created it. But you want to kind of, you want to define that based on what we just talked about.
- [05:25]
Bill Kennedy
Yeah, absolutely. So you're, you're, you're on point there. So Jim Collins was interviewing a, a gentleman by the name of Admiral James Stockdale or Jim Stockdale. And he had been a prisoner of war, and Jim, and he was the highest ranking one. And, and he got a lot of men through it, but he did a fantastic job. And, and he asked him, so who didn't make it? And, and, and Stockdale goes, well, that's easy. It was the optimist, right? Yeah. And, and what he meant by that was you have to have a sense of unvarnished truth. This is, this is what's going to, it's going to be hard, but you have to believe you're going to get through it. And when you set false expectations or really unknown expectations, we're going to be here on, on Friday, we're going to be here by Easter. Whatever it is, you don't really know, so you're better off to share that, but give people hope, the confidence that you are going to get in through. And that was what the Stockdale Stockdale Paradox was all about, is it's going to be hard, but we're going to make it.
- [06:21]
Jon Jantz
Well, there's another end of that, of course, is the pessimist too, right. Who's just, we're never going to, you know, I mean, it's kind of like you just have to balance that. Optimist. Pessimist. Right?
- [06:29]
Bill Kennedy
You do, you do. And some of us, you know, we like to think we're realist and, and all that. And, you know, it's funny, I, I, I see this in so much. You see it in today's climate. It's like when you're a CEO, you, you need a goal, you're going for whatever that goal is. So it's a destination, you need a strategy to get it there. Your highest chance of success is having your team come in, buy into that strategy, even if it's just an okay strategy. It's perfectly fine for it to be that way, but if you're all pulling on the same or rowing in the same direction, you'll get there. You can have a fantastic strategy, a wonderful strategy. No one buys in. You're not going anywhere. So this is, this is where the negative person kind of falls apart a little bit. You're trying to get everyone together, but you, you have this. A lot of times they think they're doing you a favor, like a voice of reason. That's good early because we need a challenge and pressure test and be a little, little, little battle tested, if you will. Some point, you got to put all your hands in the middle and stack hands and go after it. If you, if you can't get that person on board, this is probably not the place they should be.
- [07:32]
Jon Jantz
Again, going back to, I guess in this case, the subtitle of the book, you spent a lot of time Talking about the 8020 principle, the Pareto principle. You know, it almost sounds cliche because every business book, not every business, a lot of business books, a lot of business blogs, you know, people talk about that principle. But why do you think that it has become so universally accepted?
- [07:53]
Bill Kennedy
Honestly, I think it's a couple of things. One, it's really kind of a universal law, right. It turns out most of the good stuff comes from a very few pieces. And we use 80, 20, Pareto, figure that out. Looking at pea pods and farming and all sorts of things. I use it because I tend to wear a blue shirt every day, even though my closet's full of red shirts and pink shirts my wife has bought me. So we, we tend to do the same thing over and over, and it tends to, to be where we get it. What happens is, is that we get distracted by other things. Now, the reason 8020 is so attractive is it's quantitative. It gives you the sense you can actually figure it out. It's not, it's not just the black art. Eisenhower said, you know, plans are useless. It's the art of planning that's critical here. Same thing with the data. You get that data, it is just factual. It just is. Right. You can argue with it. You can say you're different. It just is the data. You have to decide what you're going to go do with it. And you recognize everybody you're involved with gets a vote, too.
- [08:54]
Jon Jantz
Yeah. And one of the pieces that you mentioned here, but I'm going to allow you to mention it more directly, is that if, if the agreement is, yes, 80% of our profits or whatever come from 20% of our customers or 20% of our efforts. You kind of have to define what that 20, which 20%, right?
- [09:14]
Bill Kennedy
That's right. It won't tell you what your strategy will be. It will tell you where you're making money and even more importantly, sometimes tell you where you're losing money. Yeah, it's funny, you may think, well, I got to go get more out of others. Sometimes if you just stop losing money, it turns out to be pretty, pretty powerful, right? So, so looking at that data and so there's, there's no surprise. So I always use an example. We talk about fair but not equal, right? And the example I use is people with their spouse and their, and their sibling. You think about what you, what you give or to your spouse on their birthday versus what you might do on your sibling. My sister, I send her a text, right? And sometimes I'm late. My wife, do I take out to eat. I buy nice things. Why do I do that? Because my life is surrounded by my wife and my children and things like if I don't take care of her, if I don't look after her in a way that she's, she's got options, she can go somewhere else. Same way with our customers. If you identify your best customers, the data will tell you that. And you know, they're your best because they buy a lot and they pay their bills, go do more with them they already value because they're in the one that you're buying very low or is buying very low there. You, you're probably their bees vendor, right. They're getting it from somewhere else. So identify with the data, then figure out how to take care of them in a way that they care.
- [10:32]
Jon Jantz
Could you also bring that, say, to operations or even to how a CEO might use their time? You know, we all keep really busy because the clock says we're supposed to be there from X to X, when in fact I know years of doing this myself that I would say 10, 15% of my actual efforts deliver all the money. So maybe I'd have just go fishing.
- [10:55]
Bill Kennedy
You know, there's a lot of truth in that. I see people who are, who are really amazingly efficient and do a lot of fishing too. I, I'm not that good, right? I, I, I, I, I think I'm still wasting a good portion of my time. But, but I, I try, I try to get better at it. You know, it's, it's, it's identifying th, those pieces surrounding yourself into it and, and, and Getting after it. It is so hard though. And you know, when you start out, if you're an entrepreneur, what's the first thing you do? Right? You'll take any order. You just need to get started. As time goes by, there's only one of you. We'll just make it a solopreneur. And there's only so many hours in a day. At some point you go, I'm maxed out, right? There's, I don't have anything left in the tank. I don't have any time. I don't have resources. You have to start. You then have to start making decisions, right? You have to start those folks and you have to start saying no. And it's important to say no to the right area. What typically gets our time is the squeaky wheel. And so if you have a small customer, they can wear you out. You're doing all these things, you look at the results. At the end of the year, it was de minimis. That big customer. You may not. They may be self sufficient. They're clearly happy because they're a big customer. Go get more of that. Go spend that time. Then you can go fishing all you want.
- [12:09]
Jon Jantz
So you just revealed. I haven't named this universal law yet, but one of my universal laws is that there's this inverse relationship between how much somebody pays you and how much attention they need.
- [12:22]
Bill Kennedy
Absolutely. Yeah. You know, there's something, there's something about it, right? We all have the, the story, you know, of that tiny customer. I, you know, I. So motel 6, you remember that? We'll leave the light on you. So Motel 6, when I was in grad school, we did a study on, or there was a case study that we read. And, and you know, they ran that whole, whole hotel with one person. There was only ever one person. Which, by the way, if you ever stayed in it, you believed. So, so it was a wonderful hotel and all that, but they were so efficient. So, so, so we're doing the case study and, and then they, they, they said, how do you think they did it? And, and what they did. So if you came into a Motel 6, there was a counter there, a person behind it that was the person running everything behind them was the laundry, right? They could just turn right around. It wasn't a pretty wall. It was laundry machines there. This is back in the days when I was there when you had VCRs and they would, at 8:00, they'd put the VCR, the, the video in, right? And things like that. And so the Biggest issue they had with their employees and they would fire them for this is an employee would get a call from a room, say room 10, and that person be having a problem and, and whatever the problem is. Right. The employee would leave and go check on it. Now what would happen is during that time they're going to solve this one issue. They'd have 10 people come in, try no one's at the front death phone ring. No one can answer the phone. So they had to put in hard and fast rules that you cannot get distracted by trivial things. Yeah. And so it's a really stark example of that. But they ran a whole hotel with one person and I don't remember now what, what was it they were charging? Probably 30, 40 bucks. But they made money at it because they were efficient.
- [14:08]
Marketing Expert
Let me ask you a few things. You feel like you know, what differentiates your business from every other business out there? Can you confidently charge a premium for what you offer? Are you working from a plan, a marketing roadmap that allows you to know precisely what to do next? Look, don't worry if you can't answer yes to any or all of these questions, you're not alone. See, marketers today get so focused on the tactic of the week staring them right in the face that they forget to look at the big picture. The overarching strategy needed to consistently grow their business. Over the years, I've worked with thousands of businesses helping them do just that. Create the perfect marketing strategy and plan that gives total clarity about what to do next, confidence to charge ahead and charge more, and complete control of the marketing tactics they choose. I would love to help you and your team do the same. Look to find out if our Strategy first program is right for you. Visit DTM World/GROW and request a free consultation. That's DTM World/GROW.
- [15:19]
Jon Jantz
So there's a line in the book somewhere, but I, I, I wrote this down that you, you talk about businesses needing to earn the right to grow before they can scale. And I think that's fairly nuanced. So I'd love it if you kind of unpack what you mean there.
- [15:38]
Bill Kennedy
So my favorite line with that is a baby does not make a bad marriage better. Right, right. So, so, so what we mean by that is it's interesting. You can be really good at getting customers, but if you can't satisfy them, what you wind up with is a whole bunch of short term unhappy people. When you come into an operation and you're looking at it and there's problems, it's Generally, not just the sales problem. There's operational problems, there's inventory problems, there's supplier problems. You need to correct a lot of those as you're going so you can actually earn that right to go get the business. Because you know, a customer, they don't care what our problems are. They just want what they want just like anyone else and as they should. Right?
- [16:21]
Jon Jantz
Right.
- [16:22]
Bill Kennedy
So if you can't ship on time, if your problem, if you have quality defects before you go get more people to see how bad you do, perhaps you want to go back in your factory and clean it up a little bit and do some tact time studies and look at your sourcing and on and on. Because there's very few of us that have products you can't get anywhere else. Right. Most of us have something that's easily attainable no matter what our differences are. Make sure you start with getting the machine running well. Get the engine in the car capable of getting where you need to be while you're out getting those customers. It'll make a big difference for you.
- [16:54]
Jon Jantz
I'm not sure where I heard this. It reminds me of the line. We're losing money on every sale, but we're making it up on volume.
- [16:59]
Bill Kennedy
Volume. That was the old spark plug things. We're going to sell spark plugs for, you know, $1, we buy them for two, but we're going to make it up in volume. Right. So we, we used to say that. So I started out as a sales guy, right. And I love that. I always felt like it gave me a license to make fun of them. Right. You know, there was never. I like, I just, man, if operations can make this thing and I can only sell it for a dollar, that. That two bucks needs to be their problem. When you, when you're, when you own the business or you're running the business, you gotta look at the whole P. L And you gotta figure it all out. Just cause you can get it out on time doesn't mean you can make money at it. Right. It takes a lot of effort.
- [17:32]
Jon Jantz
So if I was a business owner, I had a variety of issues that I'd identified that had me in panic mode. And I said, bill, come on down and take a look at our company. Fix us. Where do you generally start?
- [17:45]
Bill Kennedy
You know, it's. It's the most amazing thing. So I get everyone together, I get them in a conference room and the first thing I ask him is, what is our goal? What does good look like? And not some. We're going to be better Human beings and treat people with dignity. That's all important too. But where, where are we going? What's the destination? I have yet to have the same answer. Out of two people. You go around that table and operations will say something. Operations like we got to be on time. The majority of times the goal is set by whoever owns it. In private equity, typically they want to get at least three times whatever dollar of equity they put. It's called moit, Multiple Loan Invested cash. A private company is whatever the values of the owners are. Sometimes it's parochial. I'll take care of my employees in my town. Almost always it's the dividend as well. That's how they take care of their family and themselves. What they live off of. That's generally very important. In a public company, it can be all sorts of things you can get. That's why it's so hard to run a public company at the beginning of a quarter, it's one thing. At the end. You need that penny to make your, to make your earnings per share. Start with that. If you start with what the value is, what that goal is, your job as the CEO is then to figure out, make that goal and you and your team figure out the strategy of how to get there. Most people never do that.
- [19:05]
Jon Jantz
I believe that we're going through, you know, I've been doing this 30 years. I know you said you'd been doing this, this work for 30 years. So we've seen some the world is ending moments and, you know, ups and downs and cycles and whatnot. I feel like, and here, this is maybe a record. I'm 17 minutes into the show. I'm just now mentioning AI, but I think, I feel like what's going on with AI and how that's going to change business is really, we'll get through it. There'll be new industries, there'll be new jobs. But I feel like there, we're in a time where people have to decide, do I go this way or that way with my business. Standing still is not an option. How do you feel like that's going to shake out? You know, this is just a guess, but what's your view on how that's going to shake out the next two, three years maybe.
- [19:50]
Bill Kennedy
I remember in the 80s, late 80s, I didn't have a cell phone and never heard a computer. And then I get a cell phone and my first cell phone was analog, right? And they were coming out with digital. I'm like, I don't know if I want to switch. Right? Same thing. With computers. Right. If you old like I am, you've gone through all this. AI is not only coming, it's here. Right. It is absolutely going to have an effect on us. And already in our businesses it is, it is making an impact. Not, not in maybe some of the really meaningful ways. But I think I saw the other day on, you know, we, we got a terrible wars going on around the world. I think I saw where they're trying to fight the war with robots now. I don't know if you saw that in there. So I mean look, we're, we're, we're, we are definitely in the future now. AI, just like we thought computers would get rid of everyone and cell phones all of a sudden would kill all these. It changes things, but it means we can do more. And you as a, as a person, if you want to do it, maybe you got to get new skills sometimes. That's, that's the case with it. But you can continue to grow and go on and on and on. So whether you embrace it or not doesn't matter. It's happening, it's happening around us every day. Everybody I know now either has. If you got Microsoft co pilots in it, this is a very simple example. If you're my daughter, it means I'm paying for her subscription to Chat GPT. Right. So everyone's got it and they're using it to just even write simple documents now. Right. We're doing faster in our, our turnaround time is it will allow more throughput for us, it will cost us some jobs for sure. But we'll also create a whole new industry we haven't even thought about. So embrace it whatever level you're comfortable with. This, this is, this, this rocket's leaving the platform.
- [21:31]
Jon Jantz
Yeah, no, I've, I've said that at least for the last couple years that, you know, the only risky move right now is to just try to stay put and hope it goes away.
- [21:39]
Bill Kennedy
It's never worked Even, even without AI, Even, you know, there was, there was not going anywhere is making a decision. You're basically punching out. So you, you're going to go backwards or forwards. My, my, my thought is, is go with it. The other thing I would add to it is, you know, for most of us, I mean there's some big fancy companies out there that do all this. Most of us are at best fast followers. Right. I'm just really starting to embrace it and use it. I sit on a university board. We have students from all over the world now when you call our number it's. They actually interact with AI because they can do over 100 different languages, right. And can you imagine having 100 different people available at any time? And they'll send it all out. You still need people, but it's really enabling a lot of different growth opportunities.
- [22:25]
Jon Jantz
Well, I was going to say opportunity is really the word because, you know, a lot of people fear change, but change always brings opportunity. And that's really where I think we are.
- [22:34]
Bill Kennedy
Got to be agile, got to be flat. It hurts, though, right? I mean, Jesus, I. What else? I had someone like today, I don't know if you experienced this, but you can get a hold of me on a cell phone, text, email, teams. I've got a new thing they call Notion. They're sending me things on. So I've got all this stuff and I'm like, can't they just, like, you know, can they just pick one? Well, they're never going to pick one. That problem's a Bill problem, not anyone else. I'm that one as absolutely.
- [23:01]
Jon Jantz
Well, Bill, I appreciate you taking a moment to stop by the Duct Tape marketing podcast. So anywhere you'd like to invite people to connect with you and find out more about From Panic to profit?
- [23:10]
Bill Kennedy
Yeah. So first I just go right to my website. It's my name, Bill Kennedy dot com. You can see it right here in the screen. Encourage everyone to come there. You can look at the book, look at my other stuff. Happy to help in any way possible.
- [23:22]
Jon Jantz
Awesome. Again, I appreciate you stopping by and hopefully we'll run into you one of these days out there on the road.
- [23:27]
Bill Kennedy
Sounds good, John. Thank you so much for having me. This was fantastic.
- [23:34]
Marketing Expert
Let me ask you a few things. You feel like you know, what differentiates your business from every other business out there? Can you confidently charge a premium for what you offer? Are you working from a plan, a marketing roadmap that allows you to know precisely how. What to do next? Look, don't worry if you can't answer yes to any or all of these questions. You're not alone. See, marketers today get so focused on the tactic of the week staring them right in the face that they forget to look at the big picture. The overarching strategy needed to consistently grow their business. Over the years, I've worked with thousands of businesses, helping them do just that. Create the perfect marketing strategy and plan that gives total clarity about what to do next, confidence to charge ahead and charge more, and complete control of the marketing tactics they choose. I would love to help you and your team do the same look to find out if our Strategy first program is right for you, Visit DTM World Grow and request a free consultation. That's DTM World Grow.