CHAPTER 7
Build your resilience
There is no such thing as pure pleasure; some anxiety always goes with it.
Ovid
At some point in your business journey, you'll need to have conversations you don't want to have. ‘Speaking the unspoken' is what I call it. These unpleasant little chats are also called ‘tough conversations'. They're just part and parcel of being a business owner. Whether you're leading a two-person operation or a team of hundreds, a time will come when you need to hold people to account.
I had to have a tough conversation with Terry, a trusted staff member of 15 years' standing, about the theft of a significant amount of money. He had not been discreet in the way he took the money so it was easy to detect, and our systems were so robust that it didn't take long for the anomaly to show up. He was probably wanting to be found out. Sarah, one of my administrative team staff, noticed the money being moved around and told me. That, in itself, was a brave move on Sarah's part, as she knew Terry was a long-standing member of my team and that it would be a tough conversation for her to have with me.
I dreaded having the conversation with Terry, but it needed to be had urgently. As always, I prepared extensively for the meeting using — ironically, considering the subject matter — my LOAN process. I called him in, sat him down, told him what we had suspected and then gave him time to explain himself. I listened, observed, asked questions, made notes and, having given him the time to present his position, was able to provide him with a plan going forward. It was difficult because he denied having taken the money, but the paper trail was there for everyone to see. It was clear he could no longer work with us, and we assisted him with getting psychological help and provided him with a ‘fair leave' to exit the business. The process was unemotional, direct and based on facts, which enabled the unspoken to be spoken.
Tough conversations like this are never easy, but if you approach them in a clear and unemotional way, with the facts documented and bullet pointed and the supporting documentation in place, they can be done efficiently and swiftly.
He eventually paid the money back and I let bygones be bygones. We still catch up for a beer occasionally. I won't be lending him the keys to my car or my house any time soon, but everyone makes mistakes and deserves to be forgiven. I learned three important lessons from this situation: always speak the unspoken, empower your team to speak up when they see bad behaviour and implement good systems so you can spot inconsistencies quickly.
How to manage bad days
There are some days when I know I'm a little bit flat, down or intemperate. It happens to everyone and with my ADHD, it can really flare up if I'm not careful and put me in an unresourceful frame of mind. On days like that, I say I'm ‘a little bit off' in that I'm not in a position to do or make important decisions, have tough conversations or review detailed documents.
Sometimes, of course, I can't avoid that so I have found strategies that really help me get back into the zone. They sound simple, and they are, but many of us overlook the banal in favour of the exotic and overcomplicate it. In short, if you're feeling ‘off', it could be because you're over tired, over hungry or over thirsty. If you're any of those, take action to get some rest, some food or a drink. It'll make all the difference. Holding a tough conversation is difficult in itself. Don't go into stressful meetings without ensuring you are in tip-top mental condition, and don't make it worse by bringing less than your best self to the table.
No mud, no lotus
In 2015, I took my family on a road trip to Darwin. Our first port of call was the Adelaide River to see the world-famous saltwater crocodiles. As we made our way down the wooden jetty, we were greeted by our tour guide, ‘Crocodile Pat', a crusty old fisherman with a finger missing from each hand, which, he later revealed, were sitting in the belly of Big Beryl, the largest and oldest crocodile in the river. Unfortunately, Big Beryl didn't show herself that day, but we did see the most extraordinarily beautiful display of voluptuous white flowers emanating out of the muddy mangroves. There were thousands of them, each one untouched and utterly perfect.
‘What are those flowers?' I asked Crocodile Pat.
‘Lotus,' he said, clearly a man of few words.
‘How does a beautiful flower like that grow here?' my wife asked.
‘It loves the mud,' he said.
What a paradox.
I did some ‘digging' around to discover more about the lotus and found out how and why it can thrive in such a hostile and unwelcoming environment. Turns out, its roots are deeply latched into the mud and it derives all its minerals and nutrients from the mud in which it sits.
More research showed that the lotus is a special flower and is considered to be one of the most sacred plants in the world, particularly the Buddhist world. I can see why. For a start, it has a lifecycle unlike any other plant. Every night, it sinks beneath the murky water, absorbs the nutrients it needs and then emerges at sunrise the next day, sparkling clean and ready to face the day. Not only does it find sanctuary in the mud and muck, but the waxy film on its petals protects it from getting dirtied by the mud.
If there's a better metaphor for life and business, I'm yet to find it. In other words: no mud, no lotus.
Kim Kardashian and that sex tape
There are countless stories of entrepreneurs' careers that began in the mud and rose to become the lotus. Kim Kardashian's empire is one.
It's a much-forgotten fact that the Kardashian empire was kickstarted by a lurid sex tape. Kim's ‘boyfriend' at the time, R&B singer Ray J, filmed them having sex and that video found its way onto the internet. At the time, Kim was mostly famous for being Paris Hilton's personal assistant and the daughter of Robert Kardashian, the infamous lawyer who defended OJ Simpson. But the video changed all that. Enough with the backstory.
After the video went to air, the internet went nuts, Kim became famous for all the wrong reasons and the rest is history. (And before you say ‘who cares about the Kardashians', a recent tweet by Kylie Jenner (Kim's half-sister) saw the share price of Snapchat plummet by 6 per cent in one day! These gals have clout.)
The point is, without that sex tape, the world may have been deprived of Kim Kardashian and we may never have seen the likes of her or her sisters. That tape was the mud. Her career (all $1 billion of it) is the lotus. You don't have to look too far to find more stories where entrepreneurs have found themselves waist deep in mud and used that experience to rise to the top, sparkling clean, just like the lotus.
My mud, my lotus
My minor version of the mud/lotus story has nothing to do with sex tapes. (Sorry. Your loss.) But it has everything to do with the Catholic church. This is getting weird. Stay with me.
Some of the most positive and exciting opportunities in my business career have come about when I've been deep in the mud: moments when I wasn't sure how I was going to get out of it.
Here's one that is forever etched in my mind.
In 2003, I was gearing up for a big St Stephen's celebration at The Kent pub. It's one of my favourite days of the year, not for the obvious reason that we share the same name, but because it's one of the most lucrative days of the year for our pub. People are out and about: on holiday, ready to party and more importantly, ready to spend.
In case you're wondering, St Stephen's Day is also known as Boxing Day. It was created to honour one of the first Christian martyrs, St Stephen, who was stoned to death in 36 CE. Harsh. It's called Boxing Day because it was a day when the rich delivered a ‘boxed'-up present for their servants in recognition of their service.
Fortunately for us, our pub happens to be near a major horse-racing track. The Boxing Day races at Broadmeadow attract more than 20 000 people, most of whom end up in our pub after the last race. People, punting, pints, parties: you can see why it's my favourite day of the year.
We were expecting a massive day so I rostered seven of my best security guards on for the day, and I planned to station them at all the doors (and windows — you'd be amazed at the lengths people go to beat the queues) to ensure no unsavoury sorts would descend and ruin this most fabulous day. We knew the races finished at 5 pm so we were fully prepared for anything and everything that the day held in store … except for the rain, which came belting down at 2 pm. We weren't prepared for that because it was the height of summer and normally stinking hot. Instead of people fleeing for home, they flocked to our pub three hours ahead of schedule, and crucially, two hours before my security guards were ready to start work. We were totally unprepared to manage that volume of guests at that time of the day.
As luck would have it, this was the very day the liquor licensing squad decided to inspect our pub. We knew they'd be paying us a visit at some time, but we didn't realise they'd be doing it at 2 pm, the exact moment when thousands of people fleeing the rain were flooding through our doors, with not enough security guards to monitor and manage the crowd.
People were everywhere. They were lined up at the door, crawling through the windows, climbing up the balcony, sneaking through the kitchen. Everywhere. In normal circumstances, I would have been rubbing my hands with glee at this level of patronage. But that day, I was wringing them with worry. What had been so meticulously planned was fast becoming a nightmare. This one event could see my business shut down virtually overnight. We were in the mud and there was not a lotus in sight.
I quickly gathered my team and said, ‘We need to buy some time. What can we do?' One of them said, ‘How about we charge them a cover fee to get in?'
‘How will that help?' I asked.
‘It will deter some from coming in, slow down the rest and buy us time until our security guys turn up.'
‘Genius,' I said. ‘Let's do it.'
We hastily sourced a trestle table from the basement, found an ink stamp and a cash tin, and proceeded to charge every guest $5 for the privilege of coming through our doors. We had never charged people to enter our pubs before and were slightly worried we'd cop some flak from the regulars, but they could see we were getting hammered and were happy to pay just to get into what was fast becoming the biggest party of the year.
The impact of this hastily conceived but incredibly powerful strategy was immediate.
It slowed down the flow of people entering until our security guards turned up. It helped us monitor the crowd and gave us the opportunity to pick and choose who we let in (because, as you know, once you let them in, it's very difficult to get them out) and most importantly, it prevented the police from shutting us down. (And we made $5000 in the process. A handy little win.)
Now, whenever we have a big event planned, especially in this COVID-19 environment where we can't anticipate who will turn up or when, we have a simple strategy we can employ to manage the crowds and keep the police and the other authorities happy. This experience was transformative for me and my team. We prevailed at a time of extreme stress and found a creative (and profitable) way to get through a very difficult set of circumstances.
Since then, whenever I find myself ‘stuck in the mud', facing an uphill battle or struggling to see a solution, I repeat to myself, ‘no mud, no lotus', and know that a solution is nearby. I take great comfort in knowing that sometimes when you are in the deepest mud, the most unexpected opportunities will, like the lotus, arise and blossom.
Don't annoy the authorities
You may not know this, but we publicans are duty bound by the liquor laws to stop people from getting drunk in our establishments. We support these laws. Yes, we like people to drink — it's an important part of our business — but we certainly don't benefit at all when people are heavily intoxicated. Fights, injuries, ambulances, police, sirens, dogs: these are not generally considered good for anyone's business, let alone a house of fun, which is what a pub is.
So, when these liquor laws were enacted, we needed to find a way to work with the police to ensure we were able to comply in a fair and reasonable way. But before we had the chance to do that, we found ourselves in a situation that caused us a great deal of reputational damage, cost us upwards of $250 00 in legal fees and could have struck us off as directors or licensees of a hotel for 10 years.
It all started when a rather industrious policeman issued us with a low-level infringement for inconsequential issues. When doing our daily signage audits, we missed putting a sign over the door that read, ‘Minors must be accompanied by an adult at all times'. The fine, which was issued without a warning, was $2000. In the scheme of things, it was a pretty small fine, but the fact was, we knew we had followed the rule of law and had taken all reasonable steps to comply with the directions, and yet they still issued the fine.
I knew that contesting the fine would be time consuming and expensive, but I also thought, If I don't stand up for my team, and protect them from this unjust fine, what kind of leader am I? A pretty piss poor one, I would think.
So, I decided to fight it, and that's when all the ‘fun and games' started.
We fronted up to court, defended ourselves and won. It was a waste of time and money for everyone, but the police were keen to make an example of a random pub owner to demonstrate their might. It was a victory for sense over nonsense but the police didn't take kindly to losing the case.
So, when this next brouhaha occurred — a much, much more serious situation than we had ever faced before — we found our options of resolving it with the assistance of the police severely hampered. After all, if the police are against you, who do you turn to for help?
Here's what happened.
Supporting your team in a crisis
They say that the art of being wise is the art of knowing what to overlook. As a publican, knowing what battles to fight and what to leave alone is a herculean task I wrestle with daily. Pubs are dynamic places and a lot can go wrong without it being anyone's direct, or specific, fault so I'm often called upon to make a judgement decision as to what we should do next when difficult situations arise.
The decisions I make can have long-range impacts on me, my family, my investors, my staff and my finances so they need to be thought through carefully. But sometimes you have to stand up for what's right and fight the battles, knowing that in the process you might lose the war. Sometimes it's not just a principle that needs defending, but my staff. They need to know I have their back and I will defend them. If I don't, it erodes trust, respect and rapport and once you've lost that, you've lost everything.
One case where I had to make a careful decision as to what battle to fight involved a staff member, Charlie, who didn't have his Responsible Serving of Alcohol (RSA) card in his wallet when he turned up for work. As (bad) luck would have it, a liquor licensing inspector decided to pay us a visit that day and requested Charlie produce his card. When he couldn't, the inspector issued us with a fine. Charlie had a copy of the RSA card on file, and was able to produce a hard copy of it for the inspector so we could prove we were abiding by the law, but because he didn't have it on his person at the time of inspection, the inspector gave us a $1200 fine.
I had two options. I could cop it sweet and pay the fine, or I could take it to court and take a chance on the judge having the common sense to see that this kind of administrivia and ridiculous red tape was not only small minded and petty, but expensive to the courts and the state in general. We chose the latter option.
Unfortunately, the judge sided with the liquor licensing inspector and fined us. Tellingly, they let us off on a ‘Section 10', which meant we had to pay the fine but received no conviction. (I should add that the other two gentlemen facing court that day prior to us — a son convicted of assaulting his father, and a serious drink-driving offender — were both let off with no fine or conviction.)
I don't regret my decision to fight this case in court. Yes, Charlie should have had the card on his person that day, but who hasn't stuffed up and left a wallet at home before, or made an administrative error that in real terms didn't hurt or affect anyone? I went to court for two reasons. One, to demonstrate to my team that if they are caught in the cross fires of the authorities, and they have done the right thing in principle, I will go to great lengths to show them that I am 100 per cent behind them; that I will invest time, energy and funds to defend them in court; and that I will personally front up and speak up on their behalf. After all, if you have faith in your team, you will support them.
The second reason I went to court was because I wanted to show the judge how petty his demeanour was, and to give him the evidence he needed to change the law so that no other publican would have to go through this charade and waste valuable time and money.
Ironically, in between getting the fine and going to court, the legislation in this state changed, which means that a staff member no longer has to keep their RSA card on their person. Even with that knowledge to hand, the judge decided to fine us for the so-called offence.
How any small-business owner can fight for what's right
I often get asked, ‘It's okay for you, Stephen, to stand up for your staff and protect them and fight these cases because you have the funds to do so. What about the little guys, the smaller operators who get shafted by the authorities but who don't have the funds to fight them. What can they do?'
Yes, I do have the funds to fight, but even when I didn't, in the early days, I always fought the battle no matter what. I once got a loan to fight a court case because I felt so strongly about what went on. Call me crazy, but I just can't sit by while bad behaviour plays out in front of me.
If you have to fight a court case for something that's unjust or unfair, and you don't have the funds, join your local association (in my case, it's the Australian Hotels Association) and lobby them to fight it with you or on your behalf. That's part of their advocacy role.
If you don't respect the lobby or advocacy group that represents your industry, get on the board yourself and change it from the inside. If you don't like what they're doing, rally your mates in the industry to step up too, so you have some voting power. Yes, I know that means ‘getting involved' but if you want to enable change and solve the problem, you need to be a part of the solution. If you don't want to do that, stop whingeing because if you're not prepared to put some time and effort into helping make your industry group stronger and more powerful for the benefit of you and everyone else, why would others?
And just remember this: irrespective of how big your business is or how many people you employ, your voice can make an impact. Everyone has the power to make a difference.