270: The ‘Broken Cookie Effect’: Building Success for Women Leaders, with Patty Block

July 11, 2023

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Dr. Pelè: 

Hello happy people. Welcome to the Profitable Happiness Podcast. Hello everyone, this is Dr Pelè with the Profitable Happiness Podcast. Today, i have with me an expert on helping leaders in businesses, especially women, unlock their hidden advantage and create business success. Patty Block, how are you doing today?

Patty Block: 

I'm great and I'm very happy to be here.

Dr. Pelè: 

I'm so happy that you're here. In fact, i'm looking forward to learning more about your book, which is called Your Hidden Advantage. I'm very interested in learning about how you focus on women, but, most important, i want to know about these things you talk about. You say that women have more power and more choices than they actually realize when it comes to building their organizations and creating success. I'd love to get into all that, but before we start, patty, can you tell us what is the core challenge that you deal with when you interact with women in business, especially leaders in organizations?

Patty Block: 

Yes, probably the biggest issue is with pricing. That is, that we tend to undervalue ourselves and we underprice our services. This concept is so pervasive. Years ago I was really struggling to figure out how do I talk about this? How do I help women understand that when they're a service company and their pricing is artificially low, how limiting that is, because I believe everything flows from pricing Who you can hire, when you can hire, how you can bring in technology All of those things that we think of as expenses are really investments. And yet you can't do that unless you're a profitable company. And when I was growing up, my mom used to make these fabulous cookies. The whole house smelled good, it was warm, the cookies were gooey And all my life I watched my mom eat the broken cookies, but it wasn't until I was a teenager that I even thought to ask her why do you only eat the broken cookies? Do they taste better. And she laughed and said no, i eat the broken cookies, so you can have the whole ones. Wow, and that memory came rushing back to me several years ago when I was really struggling to put words around this pervasive pattern that I had seen in the decades that I've worked with women business owners And I realized that spirit of self-sacrifice that we saw in our role models, our moms and our grandmothers. We are bringing that right into our business And that's what I call the broken cookie effect And it's undervaluing ourselves. We underpriced our services, then we end up over delivering And even when our companies are very successful maybe especially then we are still saving the whole cookie for everybody else our families, our staff, our clients Everybody gets the whole cookie and we live on crumbs. And that is something. Now that I have found that wording and I share that with my audience, it resonates And when I'm on a Zoom conference or I'm talking to people, i see all these women nodding because we've all had that shared experience and we do bring it into our businesses And that also affects who we hire and how we hire.

Dr. Pelè: 

Patty, i'm going to tell you right now I have goosebumps because that metaphor is so powerful. I'm sitting here going oh my goodness, i remember my mother always sacrificing. I remember the maternal need and desire to always be last, and it's like that really could come into the world of business and it could take over And I could see how that could actually unfortunately sabotage the goals of a growing business. You've got to be able to. Sure, sacrificing is good, but you can get the bottom line to grow. That's really what you're saying. That's a powerful, powerful metaphor. Thank you for sharing that, which leads me to something I'm really interested in here and curious about How did you become the messenger of this powerful message? What's your story?

Patty Block: 

Well, many, many years ago, in my first company, i was a political consultant and a lobbyist. I loved it. It was fascinating and I'd never do it again. However, i learned a tremendous amount. One of my big frustrations was that I was always on this revenue roller coaster, ups and downs all the time. That was because my revenue was tied to the election cycle. The time that I made money was when there was a campaign to manage or there was something going on around elections. That was super frustrating. If there were resources to help me grow my business and figure out this conundrum, i didn't know how to find them and I didn't know who to trust. That motivated me to want to be that resource for other women business owners. What ended up happening is I added the lobbying to my business services because lobbying is year-round. I had been doing it informally, i added it formally and then I started doing local, state and federal. I'm based in Texas, so I would commute to our state capital and lobby Again. That would even out my revenue. It was a good strategy, except the trade-off was travel. All of a sudden, i'm 35 years old, i have three little kids at home, a thriving business and a surprise divorce. Realize very quickly that I was going to be the sole person supporting my children as well as raising them. I needed to stop traveling. I ended up taking a job. After having my business for about eight years, i closed my business and I have to tell you I really grieved. I was grieving over my family, my marriage, my business, my ideals. It was really a terrible time for me. I ultimately decided I need a job because I need health insurance. At that time you couldn't just go out and buy health insurance. I took a job with an international school as director of development and then became director of operations. That was my second motivator in starting this company, the Block Group, in 2006. That was taking my experience in finance and operations and bringing that to the small business market, started this company and wanted to be that resource for other women business owners. Over time became a pricing expert and realized that I could share this message of the broken cookie effect and how to beat that and how to be more successful as a business owner without your business feeling like a burden.

Dr. Pelè: 

Wow, wow. What a story, what a lived experience that has informed the success that you're experiencing now. I think there's this analogy that I have about how flowers sometimes have to grow through mud. Really, that's where beauty comes from. Sometimes is through pain. Thank you for sharing that. Let's take a look at exactly how you help organizations or women leaders, especially in these advanced businesses, create success through their employees. What methods did you talk about, for example, in your hidden advantage of the book, or maybe from the broken cookie methodology that you could share with us right now?

Patty Block: 

You bet. Remember when I talked a few minutes ago about how I believe everything flows from pricing, especially for service companies, but even for product-related companies, starting with your pricing, in my view, is really critical. The first thing we have to do is address how you think about money, about pricing, about how you're going to talk about that with your prospects. Especially for women, that is a really tricky issue because we feel as though, if we're talking about ourselves, we're bragging Again, because I'm based in Texas, we have a saying here that it's not bragging if it's true. All of the women that I work with are experts in their fields and they absolutely know what they're talking about and have all these achievements. But we're raised not to talk about that In your hidden advantage. I developed a system called the SNAP system. Snap stands for Stop Believing the Myths, narrow Your Focus, assess Your Value and Practice Your Power. The Practice Your Power piece in particular is very important because that is about how you communicate, and how you communicate is based on what you believe. That's the first part of the SNAP system is the S for Stop Believing the Myths. Perhaps, as we continue our conversation, we can dive into some of those beliefs and myths that do keep us stuck.

Dr. Pelè: 

I want to talk about all of them. I'm just captivated by this, in fact. if you could give us a little bit more about each one. So talk about stop, talk about narrows, talk about assess and then talk about practice.

Patty Block: 

You bet. Stop Believing the Myths is the S. When we start our business, we have certain beliefs, but so do our prospects. They have certain beliefs about themselves, about you as the expert and about their situation, helping them get clear and that's usually in your sales process that you're helping them get clear on exactly what the issue is. or perhaps there's a cluster of issues that need to be addressed. The prospect doesn't know how to do that, or they've tried several things and they haven't gotten the results they wanted. They believe that you, as the expert, can solve their problems And you have the ability to build that perceived value right. But the only way to do that is talking about the achievements of you and your team the qualifications, the expertise, assuring that your prospect that they are in good hands, and that is where communication is so critical. So stop believing the myths. that first piece of it is understanding what you believe, why you believe that, and then working to change it if that belief is working against you. So I'll give you an example For people that are advanced business owners. they've been in business at least 15 years. often they believe that their job is to keep their employees happy and engaged. Now, i would agree with that. I think that is a really important element. The problem is that that belief leads them to also believe that they shouldn't give their staff quote too much work, that they need to be really careful. And so the business owner often takes on more things and doesn't delegate them because they don't wanna overload their staff. Now their staff is ready and willing to help with whatever the business owner needs, but because the business owner has that belief that somehow it's gonna make their employee unhappy, they hold it to themselves and they take on that responsibility, so that weighs down the whole organization. And then you have all these enthusiastic employees who are ready and really appreciate that responsibility and trust, and they're not given that opportunity. So that is a dynamic that I see very frequently and it hurts the whole organization.

Dr. Pelè: 

Interesting.

Patty Block: 

Did you wanna add to that?

Dr. Pelè: 

Well, i find that really, really interesting because it's a new spin on something I'm very intimately connected with, which is happy employees do produce happy customers and it does help to grow your business when your employees are happy. But you're really identifying the fact that you can sort of overdo it with this idea of everybody's gotta be happy, so much so that I'm going to eat the broken cookie and I'm going to suffer it all and let you be happy And that's the wrong approach. I think you are very correct. It also means that those leaders need to understand the correct approach to creating happy employees, and I think we'll talk about that some more coming up, but go ahead. That was why I was like, well, that's a new spin on it. I love it.

Patty Block: 

Absolutely, and you're right, it's the broken cookie effect in action, yeah, and nobody benefits from that. So, including the customers, no one benefits from that, and yet I see it all the time, because it's that core belief that the business owner has. The second piece is narrow your focus. The N And narrow your focus is about finding and attracting right fit buyers, and that means a lot of times, especially for small business owners, we tend to take whoever comes to us And we may not have a very well-developed outbound business development effort. We're really waiting for the phone to ring And, first of all, that dynamic is a problem. But secondly, if you believe that every buyer is an ideal buyer, you're going to get burned, and you probably have already been burned because that's just not true. And yet if you think back to when you were first dating maybe in high school and every person who showed interest in you you thought they were quote the one right, and that is what I call the hope factor, and we bring that into our business as well And we think every prospect that comes to us is going to be an ideal buyer And if they're not, we can turn them into one. And it doesn't work that way, and then we get burned Or we end up taking on a client or a customer who is not profitable, not making money from it, and that's the whole point of having a business. So narrow your focus is a really important piece about attracting and finding your ideal buyer.

Dr. Pelè: 

Yeah, all of which are important skills for a leader of an advanced company with employees.

Patty Block: 

Yes, and also being that role model for your employees. Because what happens when you take someone who is not ideal and let's say they're causing a lot of grief for your company? they'll cause a grief for your employees And your employees will feel stuck because they know they have to take care of the customer And yet that customer is very high maintenance or is complaining all the time, or there's some internal problem and the employee is the one who's having to deal with that. So when you talk about keeping employees happy, taking the wrong clients is a huge problem, because then your employees are stuck with dealing with it. So that's the end for narrow your focus. A is assess your value, and that is all about appropriate pricing. I'm not someone who says everyone needs to raise their prices. That's not realistic. What I am saying is everyone needs a pricing structure because if you have a pricing model, there's a rationale behind that and it makes you more confident in talking about it, makes your employees more confident and it helps the buyer understand why you price the way you price and the kind of value that they're getting. So assess your value is all about pricing and building value, and I mentioned a few minutes ago about building perceived value, the level to which the buyer believes you can solve their problem. And you have that ability and that power to build perceived value when you know how to do that correctly and you practice that. And then the last piece is practice your power, which is about communication. And I will tell you that my experience is, in the political arena, informed a lot of what I teach, because I taught politicians the same techniques that I'm teaching women business owners now, and all of those techniques and that internal understanding of how powerful words are and how you can feel more confident. So every technique that I teach is about building your confidence, because what happens is we go through our sales process and we get to the point of talking about compensation and we, especially as women but I think guys struggle with this too that we then start all the head trash. We start thinking about well, you know, i bet they have a limited budget, or I wonder if this is really the person who makes the decision, or if I'm going to have to work up the food chain, or maybe I should offer a discount because I really, really want this client And we start all the head trash that comes out of our mouth as what I call invisible discounts, where we're offering a discount We're not even telling the prospect, we're saying this is the price. Meanwhile we're cutting directly into our profit. So that all the pieces that I teach in communication are to build your confidence, to do away with the head trash. And when you put all four pieces together of the stamp system, that is what happens. It gives you choices, you feel more powerful and empowered, you feel more confident, and when you are then talking to your prospect, they sense that they see you as more professional, more assured, and they are much more likely to buy from you. So all of those pieces fit together nicely to help women position themselves and no longer give everyone else the whole cookie.

Dr. Pelè: 

Are you seeing these snap together?

Patty Block: 

They snap together I like that Excellent.

Dr. Pelè: 

Let me just say that I really appreciate even though I'm not obviously a woman, i can tell you that your message of there being some kind of hidden advantage that maybe we or women suppress because of culture and societal upbringing and whatever, but the fact that they have more power and more choices, i think is what you've said than they realize. I think that is such a powerful message And I just can't wait to hear how you keep on pushing this into the world and helping people with this. Which brings me to what I like to call the point where we talk about the intersection of your ideas and profitable happiness ideas. In fact, as I learned from you, i'm finding that you're actually more focused on the profitable side than on the happiness side of that equation of profitable happiness, and I'm very happy about that because my whole message is that the two are not mutually exclusive. You can have a profitable company with happy employees and happy culture. It can all work together. But tell us about how you see your hidden advantage approach and snap system intersecting with the idea of happy employees.

Patty Block: 

When the business owner or the CEO is self-assured, self-confident, knows that they are meeting their mission. That affects everyone in the company in such a positive way. And the CEO needs to be a leader that inspires, that other people are looking up to. So if the employees see a leader in their company and of course they would automatically look up to the CEO if they see that person Wondering, feeling scared, feeling unsure of themselves offering all these huge discounts, one of the dynamics that I see frequently is that the person who's handling sales, which is often the business owner they're promising the sun, the moon and the stars, and then the employees have to deliver on that, regardless of profitability. Right, because employees typically aren't responsible for the pricing and the profitability. So now the business owner has made big promises, the employees have to deliver on that, and that causes a misalignment. So when there is solid leadership and everyone is communicating well, the leader is helping the employees understand how we price, who we work with, who is an ideal buyer for us, and sticks with those structures, then there's more confidence on the part of the employees because they feel like they're in good hands. They feel like I am clear about who I'm supposed to work with what I'm supposed to do, how I'm supposed to deliver, the boundaries that I can draw around this. A lot of times the employees don't really know their boundaries And so they just keep delivering, and that again can undermine the profitability and, in fact, the effectiveness of the company. So there is a direct correlation in my mind between the pricing and profitability and happy employees, and before we started recording, one of the things you mentioned was happy is not just about rah-rah.

Dr. Pelè: 

Right.

Patty Block: 

And you can't be happy every minute of every day And no one strives to do that. We know we're all humans and we know we have good days and bad days, and employees know that too. But when you have an employee who is very clear about what is expected of them and understands that they can deliver that, then they start to feel empowered and fulfilled And that leads to happiness, because we're all looking for meaning and we're all looking to achieve and to do a good job and to be recognized for that. And that's what, in my view, a good leader does is they empower their employees through clarity and structure and systems and boundaries, and they help their employees develop.

Dr. Pelè: 

You know, patty, one of the things that I love about the way you position yourself in the marketplace is your use of menomics. I love it too. like you know, snap, snap I have one for happy, you know, happy. It actually means something that people can remember. I love all that that you do. I wonder, though, if you could tell me on your LinkedIn page you've got a cool little thing here that says that you help women experts build blockbuster businesses. I was like, ok, wait a second. I'm going to let you explain that, because when I think of blockbuster, i think of Netflix blockbuster. I'm wondering if you're tying something in there. What does that mean for you?

Patty Block: 

I am. I am So think about my name is Patty Block, and Block lends itself to all kinds of graphics and plays on words, and so blockbuster is a play on word with my name, but it is also, you know, when you think of a blockbuster and what it used to be. Before blockbuster video came around, it used to be those big summer movies that would come out and people would line up at the movie theater and they would go around the block to buy their tickets to go into a movie. That's what blockbuster used to mean That's right And so that is. that idea of a blockbuster movie was that summer movie where people would line up around the block And so, taking that idea of the women that I work with are all high achievers And that is part of our goal. We want to build very successful organizations And so that the blockbuster idea plays on that, The HER at the end quickly identifies because I only work with women business owners And, interestingly, this came about when I was trying to figure out the name for my LinkedIn newsletter. And if you've done any LinkedIn newsletter, you know that the title has to be extremely short and it has to say something right. It has to in order for people to subscribe. It has to be somewhat interesting. So that's what I named my newsletter is Blockbuster Businesses And that has it's really worked well. It communicates very much. What I do in the world is I help women build blockbuster businesses and I help them build real value so that they can exit someday when they're ready and they can build real business value rather than just generating revenue that comes in and goes out as quickly as they generate it. So I work with a population of women that typically they've been in business at least 15 years, and they're positioning their company so that they can be a little bit less chained. I think of it as feeling chained to their business by golden handcuffs of their own making, that we want to be our own boss and we create our companies and we build it and end up, as I mentioned earlier, where we don't want to overload our staff. We want everyone to be happy, and so we eat the crumbs and continue to do a lot of work that we could delegate. and as we're building our organization, we need to be thinking about you're going to have to exit your company someday.

Dr. Pelè: 

Yeah.

Patty Block: 

Voluntarily or not Right. And the older we get, the more we start to worry about our health And think about if you've put this in terms of the broken cookie, when we make sure that everyone else gets the whole cookie. That includes our staff, and one of the things that I hear over and over is I want to make sure my staff is taken care of, so if I get sick or a family member gets sick and I need to step away from my company for a period of time, i want to know that my company is in good hands with my employees. I trust them, i've trained them and that they care, so they're going to take good care of the company And if I need to step away, everything isn't going to fall apart. And so that's the work that I do in my private consulting is helping women position their company for their eventual exit and make sure that everyone is taken care of, because that is so important to them, along with legacy, and making sure that everything they've built isn't a house of cards.

Dr. Pelè: 

What just powerful metaphors and systems that you've built. I really appreciate hearing about these. Tell us what you're excited about, what you're sharing with the world and how people can get ahold of you online right now.

Patty Block: 

Wonderful. Thank you again for having me. You can reach me through my website, theblockgroupnet. And what I'd like to offer to your audience is I have an assessment called your exit readiness index, and that helps you determine what pieces you have in place and what pieces you might be missing in positioning your company for your eventual exit. And when I work with women in order to position their company for exit, it usually takes about five years, so there's a lot of misunderstanding about what it takes to build real business value. So this assessment can help you determine that, and you can find the assessment at she-exitscom, so sh-e-ex-itscom, she-exits Perfect. And then I love connecting with folks on LinkedIn, and it's Patty with a Y. If you choose to connect with me, please mention this podcast so I can make that mental connection.

Dr. Pelè: 

Awesome, that's so awesome. Well, i will also include the LinkedIn URL that you have on LinkedIn, which is how we met, and make sure that's in the show notes. Patty, thank you so much for being a guest on the Profitable Happiness Podcast.

Patty Block: 

Thank you so much.