Episode 191: From Capacity to Capital – Rethinking Effective Leadership

—————————–

Today Counts Show Episode 191

Preview

Jim: These same five C’s that protect a bank’s assets also protect a leader’s mission. If you are mesmerized by somebody’s apparent talent, I would tell you to put the brakes on immediately. Confidence plus emotional maturity plus endurance equals– If you’re looking to hire somebody who’s never made a mistake, you’re probably looking for the wrong person. Character is the credit score of leadership. So, the five C’s are this.

Appreciation of our Supporters

Winston: Hey, before we jump into the podcast, we want to thank all our donors and supporters who make the Today Count Show possible. It’s through your generosity that we’re able to shape leaders through this content and this podcast. And be sure to like, subscribe, and follow wherever you find yourself coming across this content. All right, let’s get to the podcast.

Introduction: Building a Winning Team and the Top 3 Leadership Mistakes

Jim: Welcome back to the Today Count Show. I am your host, Jim Piper. Today I am flying solo. I want to talk to you about something that I have learned through my life. I don’t have it down 100% because it’s really hard. But what I want to talk to you about today, well, let me back up this way. If you’re a supervisor, if you’re a manager, if you’re a director, if you’re a vice president, if you’re an executive, if you’re a business owner, an entrepreneur, if you’re a coach, if you’re anybody who is trying to put together a winning team, then this podcast, this episode, is for you.

Why This Episode Matters

I’m sure you will find value in it because we are going to go into some depth, and I would encourage you to share this episode with others if you think what I said is true. Definitely be sure to listen through the whole episode if you are any of those that I’ve just described.

Introducing the Five C’s

I want to talk to you about the five C’s of choosing your people. I guess I would subtitle it this way. What banking? Yes, banking. B A N K I N G. Not baking, as in baking cinnamon rolls. That sounds pretty good right now. But I’m talking about banking. Financial networks. Banking. What banking, believe it or not, taught me about building great teams.

Banking Backstory

I’ll give you the backstory really quick. In my early to mid-20s, I was being groomed as a business banker. And in that framework, they taught us how the bank makes money. And in case you don’t know how the bank makes money, the bank takes your money that you deposit, leverages that money, and gives out loans at a margin that makes them money.

Now, that sounds pretty easy. It’s not. It’s difficult, it’s highly regulated. The bank can only take a certain percentage of the liabilities. That’s what they’re called when you have a savings account, a checking account. On the bank’s balance sheet, that’s a financial document, it shows as a liability, meaning that it’s not theirs. That’s not their money, it’s your money. However, the government allows them to take a portion of that money and use it to give out loans to consumers and to businesses. And they’re only allowed to do that to a certain percentage.

If they make too many bad loans, the government has ways of penalizing or overseeing and sometimes called receivership, and takes control of the bank. And so they try to encourage or to lessen your concerns about whether your money is safe by insuring it, and for those of you who are watching the YouTube channel, I’m putting that in quotes, insuring it with what’s called the FDIC.

Shifting Back to Leadership

All right. You’re not listening to this to get a banking education, but it is important in leading to the topic that we’re going to be talking about here shortly. The top three mistakes that I have made in leadership. If you were to ask me that question, I’m going to answer it, but I’m not going to answer it as in the past, like I’m looking in the rearview mirror, because I think that these three things that I’m going to share that have been my greatest struggles in leadership still live on today and still can be problems for me today.

Leadership Mistake #1: Assuming

The number one, it’s a broad word, but it’s still true: assuming. Just assuming in general. Assuming that my team can read my mind, assuming that the message I sent is the message that was received, assuming that my decision is correct in every way. Most of my decisions may not have been poor decisions in and of themselves, but when and how I carried out those decisions often proved to be not the best. So, in other words, assuming. I could go on and on about assuming. So, just assuming in general, not being diligent in the most detailed way in important matters.

Leadership Mistake #2: Not Taking Care of Myself

Second, not taking care of myself first. Not taking care of myself first. That would be the second thing because that can lead to burnout. I’ll be talking about that later as a flaw that leaders or even individuals can have in their approach to life and leadership.

Leadership Mistake #3: Hiring

And the third, which is really the topic of this episode, it’s hiring. Hiring isn’t just bringing someone new onto your team. Hiring also involves promoting them. It involves building a stronger team. That’s still really under the idea of hiring.

Applying the Five C’s Beyond Banking

All right, so that’s just a little bit of the backdrop. So let’s talk about these five C’s of credit because the five C’s of credit became the framework for all of the decisions that I made as a business banker. Not only in whether I was going to extend credit to a client or not, but I also used it as a way to help business leaders understand how they can build a strong business.

So, as a business banker, I learned that I became more successful as I was willing to become an advisor and a coach, not just a cop who said yes or no to their loan request. However, as time went on and as I began to ponder these five C’s more and more in life, I came to realize that the same principles, the same five C’s, not only protect a bank’s assets but also protect a leader’s mission. That’s right. I want to say it again. The same five C’s that protect a bank’s assets also protect a leader’s mission.

So, let me say it this way. If you want to build a strong team, don’t just look at resumes. Don’t just look at charisma. The person that is sitting on the other side of that conference room table or that Zoom conference or that Teams conference that you are having. But look through the lenses of five C’s.

Now, these five C’s I’m going to give to you in rapid order. Then I’ll go back real quickly and explain them in short order. Explain them from a banker’s perspective. And then we’ll transition and talk about it from a team perspective, a people perspective, a leadership perspective.

The Five C’s of Credit: A Banker’s Framework

So, the five C’s are this, and if you are in a place where you can write these down, I would do that or come back later, listen to it again. And as a little teaser, my next book, which is hopefully coming out in first quarter of 2026, the working title on it right now is Re-imagining Leadership, and this will be one of the chapters in that book.

So, the five C’s without further ado: number one is character, number two is capacity, number three is capital, four collateral, and five conditions. Those are the five C’s of character. And they can also be used in our work as leading people.

Character in Banking

Let me talk about character from the perspective of banking. How did we measure character when it comes to giving a loan? Well, if you have looked to buy a home lately or if you have looked to buy a car or anything like that, you’ll know that your credit score is something that people use to qualify you for a loan. Now, we didn’t quite have them back in my day, but they were similar, or we called them TRWs, but they gave us a credit score. So, that was certainly one of the concrete practical ways of measuring someone’s creditworthiness.

If they were a business, we also had reports for them. The most popular in my day was known as the Dun and Bradstreet. But just to give you some examples of what was on a Dun and Bradstreet report for a business is besides things like their legal name, where they’re at, their address, phone number, business type, number of employees, years in operation, things like that, but also their trade lines, their accounts with suppliers and vendors, their payment trends, whether they’re on time, late, past due, and kind of an update on their accounts payables, receivables, if they’ve had any bankruptcies, liens, judgments, lawsuits.

We also would want to look at their financial statements, their annual revenue, their assets, their liabilities, that kind of thing. And typically on at least the Dun and Bradstreet report, we got a score of a 0 to 100. That’s an example of one of the things that we would use to assess character in a lending situation to a business.

Capacity in Banking

All right, I think that’s not the only thing, but it is something that is concrete and tangible to look at.

Capacity for a banker is simply: do you have the cash flow to make these payments? And again, on a consumer perspective, we would look at a debt-to-income ratio. Maybe you’ve heard that term before. In business, it’s a little more complicated than that because many businesses are very seasonal in nature and therefore need things like a line of credit or they need a lot of reserves. So capacity is simply: do they generate enough income, enough net income, or at least enough cash flow to get them through a certain season of stress?

Capital in Banking

The third is capital. Capital is just that. How much liquid assets do they have available that they could liquidate in tough times or times of expansion? That’s another example.

Collateral in Banking

And then of course there is collateral. And collateral is what they’d be willing to put up to get this loan. In other words, if they want a loan to do such and such, and they have enough equity in their property, they might put up their property or their inventory or their accounts receivables. Those would be three examples of collateral that we would take and we would secure so that if the loan were to be defaulted, the bank could get its money back from that very ugly and terrible place of foreclosing, if you will, on the collateral.

Understanding Conditions

And then the fifth, and by the way these are typically weighted also in this order from character, capacity, capital, collateral, and then conditions. Conditions is like: would I give a loan to a popsicle company in North Dakota that for whatever reason only wants to sell popsicles in the winter? That’s a crazy example, but it paints a vivid picture, does it not, of conditions.

Or the mistake I made, to be a little bit vulnerable, is I gave a large line of credit to an entrepreneur who was taking advantage of the current tax breaks given to homeowners who would install solar. And this is way back in the 1980s. In the 1980s. And as a dumb du,d took for collateral their solar panels that they were holding in inventory that he bought at a discount because he bought at volume.

What I didn’t understand was how quickly the laws of the land can change, where a governor could come in and change, or a president even can come in and change the tax rules, the tax deductions for such, that would create an absolute collapse of solar sales. And I experienced that firsthand. That’s another example of conditions.

Transition to Applying the Five C’s to Leadership

All right, I could go into more detail, but I think you get the idea there.

So, let’s talk about what each of these means when you’re interviewing this very important person to join your team or you’re considering people for advancement.

Character: The Credit Score of Leadership

All right, so character. A simple question that I would have you ask is: can I trust this person? Can I trust them? That’s a question of character. Maybe you can recall a time you trusted somebody who had a lot of talent, had a lot of competence, but they had questionable integrity. And did that cost you? Unfortunately, I already said that one of my biggest mistakes in leadership was hiring. Well, to be more specific, there was a season in my leadership that I, for some reason, really liked the bright and shiny things. I liked that word talent, and I could see talent, but for some reason I forgot that talent only gets you started. It doesn’t sustain, doesn’t keep you going.

And so I hired highly talented people, and some of them did not have character. They did not have integrity, and they hurt me in the end. In fact, I have found that I’m not the only one who sees talent as fun and shiny. And so, in other words, they can woo people. They can pollute the stream. They can pollute your culture if they are highly talented and charismatic individuals but don’t have integrity.

It’s almost like I’m going to go to this extreme. If you are mesmerized by somebody’s apparent talent, I would tell you to put the brakes on immediately because you’re going to be hypnotized down that path. The more talent you see, the more due diligence you need to do in regards to the person’s character.

So let me say it this way: character always precedes competence. Character must always precede competence. So you’re first looking for character.

Four C’s of Hiring: A Framework

I once read a book by a leader that I respected. I forget the title of the book, but I do remember the three divisions of the book. He talked about character, competence, and chemistry in that order. I would add calling. And what I mean by calling is do they really want to be here? Do they feel a sense of purpose being here? So character, competence, chemistry, calling.

I see the character thing repeated by anybody who has given thought to hiring. So the talking point would simply be: what do you believe about someone’s word? If you use words like humility and honesty, then you are moving in the right direction with the right choice. You’re looking for humility and honesty under this umbrella of character.

What are some warning signs against this idea of character? When people make excuses, when they always have a reason why something happened or didn’t happen, and they are deflecting from themselves. Inconsistencies, self-justifications. So that’s kind of like your yellow light to saying that you might have a character issue here.

The Nature of Talent vs. Character

I’m going to say this off the cuff. It’s not on my outline, but I just thought about it right now. It seems to me that talent seems to be more divinely given, more given by the grace of God. It seems like some people, I’m not saying they don’t put hard work into things, but there are people who are talented for this and talented for that, whether it’s playing an instrument, whether it’s singing, whether it’s a given leaning toward science or language or people, whatever it might be. But character is something that it seems like all of us have got to go to school on all the time. In other words, if they don’t have character, they probably don’t care about it. And so that is a really scary thing.

Green Lights for Strong Character

So let me give you some green lights though that tell you that you might be dealing with somebody that has good character. Because if you’re looking to hire somebody who’s never made a mistake, you’re probably looking for the wrong person.

I have some slang in the way, especially if I’m looking for a leader to walk beside me or somebody that’s in my inner circle. I’m actually looking for some people that have a limp. And that’s a biblical reference to somebody who wrestled with God, meaning that they’ve been burned. They’ve made some mistakes. And better yet, they’ve learned from those things. Those things have marked them and have made them a better person because, without making this a cliché — I mean, it already is a cliché — it’s made them better, not bitter. So I’m looking for that.

But anyway, some other green lights are that they’re truth-telling under pressure. They’re truth-telling under pressure. If your interviews are too easy, then you know you’re not going to put them under pressure. If it’s a one-and-done interview, how many different angles can you take a look at this person from? I sometimes have asked for references of people that they’re uncomfortable with. “Could you give me a name and phone number or email address of somebody that you think might have a different opinion on you? Would you be willing to do that?” That’s a tough one, right? But truth-telling under pressure and people who are doing the right thing even when nobody’s looking — that’s almost become a cliché also.

Trust as a Sign of Character

Another way to ask you a question on this: who on your team makes you feel at ease because you trust their motives? That’s a good sign of character.

Okay. Finally, for character: character is the credit score of leadership. Character is the credit score of leadership.

Capacity: Carrying the Weight of the Job

All right, let me move on now to the second. So the first is character. The second C is capacity.

Well, what does capacity look like? It’s simply this: can they carry the weight of the job? Now, if you’re in leadership, you know exactly what I’m talking about. And they might have skill sets, but with leadership comes this invisible weight of pressure, of deadlines, of people making mistakes, of a customer being upset, of the speed of things, what’s required in accuracy.

So when you reflect on your team or think of a season, can you think of a time or a person or a season when you were simply asking too much and then you realize, “I’m just simply asking too much,” or maybe you were asking too little from someone?

Most of the time when we talk about that, it really gets into this intangible piece of weight. Leadership is about carrying weight. It’s about resolving decisions that need to be made. It’s about making decisions where there seems to be no good decision. It is those kinds of things. It’s when you feel like you’ve got three fronts that you’re fighting all at the same time. That’s intangible weight.

The Capacity Equation

So capacity is about that. Let me give you an equation that I like to use when it comes to determining somebody’s capacity. So they have to have competence, right? It’s competence plus emotional maturity — right? So they’re not breaking out in hives. They’re not freaking out. They’re not — when the pressure gets high, they’re not succumbing to some sort of quadrant three or quadrant four type of numbing their pain, drinking too much, whatever it might be. People have all kinds of vices, and under pressure, do they turn to those vices as relief? That’s not a good sign. If you’re stressed out and the person says, “Man, I need to take a run,” and they go on a two-mile run — okay, that’s a good example of somebody dealing with stress in a positive way. And not to beat anybody up, but you know what the vices are, and if they turn to those vices, they’re filling themselves with things that are going to come back and haunt them eventually.

So there are three things here: competence plus emotional maturity plus endurance. Competence plus emotional maturity plus endurance equals capacity.

So look for people who stay calm under stress and they keep learning. Those are the two things. They stay calm, but they’re also learners. They’re constantly learning. Now you’re dealing with people with capacity.

Teaching Discernment and Identifying Growth Curves

When it comes to your team, I would always encourage your teams to discern. Teach your team what discernment means. It means evaluating, it means thinking through things, it means slowing down. Discern whether this job that I’m in right now is a good fit for me, or if I’m being challenged, what is my growth curve? Can I articulate where I need to grow?

I was talking to a young leader the other day who’s in operations and seems to have high levels of competency in operations but also has aspirations for a higher level of leadership. And so I asked him, “What do you think your growth curve is? What are the areas in your leadership where you think you need to grow?” And he knew right away. He knew that he didn’t really understand financials as well as he probably should. So he didn’t really understand the difference between a P&L and a balance sheet. Didn’t understand what goes on a balance sheet, what goes on a P&L, why some things can be written off as an expense, why other things need to be carried over time — these kinds of things.

Building Capacity Through Support and Role Fit

So it was actually a pretty simple fix. All we did was make a connection between he and a colleague who that was their strength, and we’re starting to chip away at that. And so that’s how you can build someone’s capacity — having them jogging alongside of them in discerning their fit for the role, and is there another role that would be a better fit, or can the job be tailored differently so that that person can flourish, and what are the areas in which they need to grow.

Sometimes you hire somebody and they grow rapidly through that. So you want to promote them, but you’re not always thinking about the things that they’re not equipped in in that next role, which is often a capacity issue.

Warning Signs of Low Capacity

So what are the warning signs of somebody not having the capacity that they need to have in their job — the job you’re trying to hire or the job you’re trying to promote them to? Burnout, blame, and constantly being overwhelmed.

When you see somebody pulling their hair out and they still haven’t figured out the difference between doing things, delegating things, evaluating what really needs to be done. For example, in my coaching, I say all the time, “What needs to be done? What needs to be done?” And some work so much on a task list that they don’t really even know the difference between a task and what needs to be done, what’s really important, what’s strategically important for the mission that needs to be done. Because there’s always work to do. The work never goes away.

Zoom Lens vs. Wide-Angle Lens

Some, frankly, are addicted to to-do lists. They’re addicted to task lists. And they don’t — another way we say it is every leader needs a zoom lens and a wide-angle lens. They need a zoom lens to be able to zoom in on the things that are important to diagnose what needs to get fixed or what we need to talk about. But at the same time, they need to have a wide-angle lens that they consciously put on and get the big picture so that they know what to zoom in on.

If somebody has a zoom lens attached to their forehead and they cannot take that zoom lens off and then put on a wide-angle lens, you have somebody who has a capacity problem. They might be able to be coached out of it, but some cannot be. And it’s not that we don’t value them. They just have to be in a position where they do like redundant work. They do like specific task-oriented work. But when it comes to higher levels of management, that’s going to be a problem.

The Leadership Insight on Capacity

So what’s the leadership insight here? A wise leader doesn’t just add people; they add capacity. That’s pretty heavy. You need to think about that. If you’re bringing somebody on the team and it doesn’t strengthen your bandwidth, it doesn’t strengthen your ability to carry more, to do more, then you have a problem there.

So who on your team can grow into a greater weight — carrying greater weight — and who is already overloaded? That will give you some hint on some things that you might need to change.

All right, we’re moving on now to capital. So we’ve talked about character, we’ve talked about capacity, and now we’re talking about capital. I think at this point you’re probably convinced that these five C’s do help a lot for a leader. So I hope that you will share this information with others. All right, we’re giving it away freely, so I hope that you’ll do that.

Story Ad

Winston: There have been seasons in my life where I’ve looked back and I thought, what was that even about? Did I grow in that season? Did I get better? Am I still stuck in that season? If you have similar thoughts, I want to introduce you to a book called Story: The Art of Learning from Your Past. This book, written by Jim Piper, shares principles and stories that actually help us get unstuck and step into the future we’ve always wanted. Be sure to stop by leadtodaycommunity.com to grab your copy today.

Capital: Contributing More Than You Consume

Jim: All right. Capital. What do they bring to the table? That’s the question. All right. So hopefully they’re bringing character, hopefully they’re bringing capacity, but what are they bringing to the table in the sense of capital?

Well, what do you mean, Jim? Well, almost everybody brings more to the table than what the job requires once you get to know what the person is or how well the person knows themselves. In fact, when I see good hiring going on, by the time that hire becomes complete, we’ve actually redone the job description. We’ve added some things to the job description that we weren’t planning, and we’ve taken some things off because the person is providing some capital that we want to use, and some of the other things that may not fit them so well, we have found somebody else to do that. That’s kind of what we’re talking about here.

What Capital Really Means

So, it strengthens the team. Let me put it this way: capital isn’t just money from a banker’s perspective. It’s energy, it’s experience, and it’s relational equity. When somebody brings in new energy, then there are probably some projects that are available that need that new energy to push across the line. Or they have experience in things that add great wealth to your team or your organization. Or frankly, there’s somebody who can bring some relational maturity to the room.

Sometimes when you have people… now, age by itself doesn’t make somebody more mature. Unfortunately, I know people my age that are still so emotionally thin it’s scary. But a lot of people, maybe most people, as they get older, they hopefully mature. And so, I don’t know how HR is going to feel about this comment, but a lot of times we can bring a sense of balance, a sense of calm, a sense of maturity to our teams by adding some age to those teams. And that’s what I mean by relational equity.

But the same can also be true where you need some youth, you need some energy, you need somebody who believes we can take the hill. This is the kind of capital we’re talking about.

Contributing More Than You Consume

So here’s what I mean: every healthy team member contributes more than they consume. So if you’re sitting down there and you’re evaluating your team members and you say, “All right, we’ll call one of them Johnny. Johnny does his job, but you know what else he does? He does this, and by doing this he contributes more than he consumes. He sometimes needs help in this and this, but he also provides capital here and here because of who he is or what he does for us.”

So, I always enjoy helping people see their capital because a lot of times they’ve even boxed themselves out of adding additional value to their organization because they’re only looking at their job description. It’s amazing how people can help one another if they will lift their head up a little bit and notice that so-and-so is really good at this and better than me. Even though that is on his job description, it’s on my job description, there might be some ways that we can help one another. But that takes a little bit of creativity and capital.

Helping People Identify and Use Their Capital

So, I love to help people find their capital, see it, and deploy it strategically in the organization.

So here’s the application: does each person on your team, or the person that you’re considering to hire or promote, do they know their value? Do they specifically know their value? Have you articulated that to them and how it serves the mission?

I think a lot of leaders have capital lying around not being used because they’re not engaging their team in conversation, both as a group and as individuals, on this matter. In other words: “Jim, is there anything that you think you can provide to this organization, this team, that for whatever reason you currently see as an obstacle or that you cannot or that you have not been given permission to do? Think out loud with us.”

Asking the Right Questions About Value

You’ll be surprised what will come up in that conversation, even in a hiring process. “What do you think you could add to this organization, to this team, beyond your job description?” It’s a great question to ask.

So great teams are built when every member brings capital, not just a cost. So every team member is going to bring a cost, but the overflow—what do they bring as an overflow? Great teams are built when every member brings capital, not just a cost, and everyone recognizes it.

Collateral: Skin in the Game

All right, let’s shift now to the fourth, which is collateral. And collateral is simply this: so I know what collateral is in banking and so do you. But what is collateral in the sense of hiring, in the sense of a team?

Well, collateral is what are they willing to risk? When you see people that have this attitude: “Okay, you go first. You guys try that. It’s not going to work,” you’ve got somebody that’s not willing to put something at risk. In other words, can you tell the difference on people in your teams—some that are all in, some that have stuck their neck out? They stayed when it got tough. It was risky to stay, but they wanted to stay. They were thinking about a bigger truth than just their own.

You see, in banking, collateral is what proves commitment. If you’re not willing to give me collateral for this loan, then it tells me you’re not committed to it. If you’re going to say, “Oh, there’s no way I’m going to sign a personal guarantee,” well, why not? Why wouldn’t you sign a personal guarantee? Well, because you don’t want to risk what you already have. Well, that’s the whole point of collateral.

Sacrifice and Ownership

Collateral is, let me put it this way: in leadership terms, it’s skin in the game. What skin do they have in the game? Are they having to move to join your team, leave all their friends behind? That’s skin in the game. Are they coming on for less in pay than what they were getting because of the vision that you’re putting out and maybe even some of the promises, which you need to be really careful about? Are they coming in for that? Do they see a future at your company that they may not see somewhere else, but somewhere else they have a better package, but they’re seeing your vision?

So it’s what skin do they have in the game? What sacrifice? What ownership? And what follow-through? Because that often determines follow-through.

Identifying True Investment

So look for people who tie their personal success to the team’s success. This is really important. If a person cannot tie their personal success to the team success, you have a problem. If they can see their personal success in a vacuum and they cannot see it related—or vice versa, that the team success is their success—you have a collateral problem.

So look for people who tie their personal success to the team success. If the team’s not successful, I’m not successful. I’m going to say that again: if you’re applying the fourth C of collateral to hiring and team development, then you’re looking for somebody who ties their personal success to the team success. And if they start looking over the fence because the team isn’t succeeding, then that’s not the kind of person you’re looking for.

All right. So who around you is just renting space and who’s truly invested? You can interpret that how you want.

And I’m going to say something that’s probably controversial because I think it’s understood the wrong way out in the marketplace. I want to say this: you can’t build with people who have nothing to lose. Often when we say, “I’ve got nothing to lose,” what we mean by that is, “This is my last-ditch effort. I’m going to swing for the fences because I’ve got nothing else I can do.” That feels like a Hail Mary to me. It feels desperate to me.

What I’m looking for is somebody who says, “I’ve got a lot to lose.”

A Personal Story About Collateral

I want to tell you a quick story about how I came to understand this by accident. There was a time in my life where I was moving my organization from point A to point B. And there was a lot of internal anxiety going on in me at that time. I happened to be walking into a room getting ready to sit down at a conference table. It was related to what I was doing at the time, but it wasn’t the same thing. I was around colleagues.

As I was beginning to sit down alongside another colleague, I said to him, tongue in cheek, “Mike, why am I more anxious about making this move than I was starting this organization in the first place?” And without hesitation he said, “It’s because now you have something to lose.”

And it was like a light that went on in a dark brain where I went, “Oh, wow.” In other words, I had put all this work into building something. Because in the beginning, it was just my effort, and if it failed, it failed, and I would have moved on. But now I had built something. Built something worth fighting for. Built something worth living for. Maybe even built something worth dying for. And so now as I was making moves, there was a lot of sobriety in those moves, a lot of discernment, a lot of careful thought, a lot of collaboration, a lot of teaming in those moves.

So that’s what I mean: you can’t build with people who have nothing to lose. Easy come, easy go. If they can leave you just as easy as they came, then that’s probably not somebody you’re looking for.

Conditions: Thriving in the Environment

All right, let’s get to the fifth one. I’m already exhausted talking about these, but the fifth is conditions. Simply this: are they thriving in this environment? Will they thrive in this environment?

Conditions are about environment.

So when you’re looking at a talented person who’s underperforming, you either have a character issue or you have a conditions issue. You have an environmental issue. The environment isn’t right. The conditions are not right. Or you might have a leader who knows how to create conditions where others flourish. You’re looking for those kinds of people as well.

And here’s the thing: even good people, good performers, can fail in the wrong environment. They can fail in poor environments. Some people are not turnaround people. Some people just aren’t. They want an environment where everything is stable. So if you’re looking to do a startup, that’s something to consider.

The Leader’s Responsibility in Creating Clarity

So leaders are responsible in your interviewing process, as well as your teaming process. We’re responsible for providing clarity. What does this job require? What does it really look like?

Sometimes what’s good to do in an interviewing process is after you’ve gone through a lot of the due diligence, you need to say, “Okay, after everything that we’ve talked about, how do you see this job? What does the culture seem like to you? What does the environment seem like to you?”

One of the things I’ve come to believe is that when we want a job so bad—when the applicant wants this particular job so bad—the first person they will lie to will be themselves, because they’re not thinking about the question deep enough. They’re thinking, “All right, so if you say, ‘Is this a job that you can do?’ Well, just about anybody can do just about any job for a day, for a month.”

But that’s not what you’re asking. You’re asking: go down six months, a year, two years, three years, and think about the day-in, day-out struggle of this job, the requirements of this job. Now, let me ask you again: do you think you can do this job? And then an even more important question: do you want to do this job?

I think we rush and don’t get to those kinds of questions.

That also comes on the front end when we’re interviewing. We’re responsible for clarity, communication, and culture. Matching people to the right role and the right rhythm matters. Sometimes we will end up knowing the candidate better than the candidate knows herself. That’s what good interviewing looks like.

Are you creating the right conditions for hiring, for your best people to stay and grow?

Conclusion: Evaluating Trust Risk

All right. So, let’s wrap it up this way. We’ve talked about the five C’s of lending, the five C’s of banking: character, capacity, capital, collateral, and conditions. And what we’ve done is we’ve transformed them. We’ve reframed them. We’ve retooled them for leadership, where we’re really using them for things like: how do we develop trust, strength, contribution, commitment, and environment?

So these same C’s that protect the bank’s investment will also protect your leadership mission.

Here’s what I’m going to challenge you to do: pull out your team roster and go ahead and grade each person on your team in each of those five C’s. And after you do that—just like school grades, A, B, C, D, F—and obviously do this in the confidence of your own private counsel, maybe you have an inner circle that will do some talent evaluation with you, but be sure to separate a person’s value from their performance. And I know that sometimes those overlap, but be sure to separate a human being’s value from their performance based upon all the things we’ve talked about.

But as you grade each of these, then ask yourself: where do I need to invest? Where do I need to encourage? And where do I maybe need to make a change?

In banking, you’re evaluating credit risk. In leadership, you’re evaluating trust risk. Get the people right and everything else follows.

Outro

Hey, thank you so much for joining us on The Today Counts Show. We’ve got so much more planned for you. So stay tuned and stay connected on Instagram, LinkedIn, Facebook, and subscribe on YouTube. And remember, today counts.
—————————–