Relentless Customer Leader Podcast

Dr Chris L. Brown (00:01.752)
Well, I'm here with Jim Penman today and really excited to have this conversation with Jim. Jim's well known as an entrepreneur in Australia here with a very large franchising business and famous for Jim's mowing in particular. So excited to speak with you and to have you here today, Jim.

Jim (00:23.293)
Yeah, good to be here.

Dr Chris L. Brown (00:25.198)
So probably, you know, I was really intrigued when I was reading a bit more about your story and background. You had this early sort of start in academia and sort of undertaking a PhD. And I believe the original thesis title was personality and culture. That was one that wasn't accepted for some reason. Can you tell me a bit more about that early history?

Jim (00:48.351)
I call it personality and social change. It's basically a theory of, I set out to try and understand the reason for the rise and fall of civilization. So the biggest topic there is. And I came to the conclusion that it was basically to do with temperament, with character. It wasn't impersonal political forces. Today with the way people think, know, people are hardworking, enterprising, you have prosperity.

If they're loyal to impersonal values and principles, you tend to have democracy and republic and so forth. So it's that kind of idea. I identified it. Eventually I came to the conclusion it had biological roots. There's something to do with the way we were evolved to cope with the environment. So that was my thesis was completed in 1982. Originally not back. It was just too outrageously different. The examiners didn't know what to make of it.

But the point of what I'd always intended to have an academic career. And when I finished my thesis, which I thought would convince people, I thought people would look at it and say, wow, this is interesting stuff, but I couldn't get any purchase on it. So I thought the only way to continue my research is to become wealthy enough to be able to fund my own research institute in areas I knew nothing about, which is basically neuroscience and genetics and so forth. So

I turned my part-time student lawn mowing business into a full-time business with the aim of eventually having enough money to pursue my research.

Dr Chris L. Brown (02:21.644)
Yeah, it's a great origin story. Where did the early interest in, I guess, some of these ideas come from for you? What was the sort of early influences? How did they, how did you become curious about these ideas?

Jim (02:24.915)
Yes.

Jim (02:36.319)
Well, when I was 14, somebody gave me a copy, a friend gave me a copy of the Thucydides, the Peloponnesian Wars, which was intriguing. I've probably read it about three times since then as well as, so it just fascinated me, this incredible, amazing civilization, which basically...

went through this terrible period of chaos and then after it declined quite rapidly within a few decades they were all overcome by Macedonia and became part of a multinational empire. So I just wanted to know what that was. And I became very interested in the decline of the Roman Empire too, which happened a little bit later. What happened? What drives these things? Why do people change?

So that was the thing. And I also had an interest in biology as well too. Even when I was a kid, I was crazy about dinosaurs. And then I read things like Naked Ape and stuff and just looked at trying to understand people as biological beings. So it was part of my way of thinking about it even well before I went to university.

Dr Chris L. Brown (03:32.226)
Yeah, yeah. And then you, you know, as a way of funding this, this passion and interest, you started the, the mowing business and, as you think about the back to those early days, how did that develop? So initially you were doing the work yourself, obviously engaging with the client, delivering great lawns that were exactly what the client wanted. And then, and then, you know,

Jim (03:40.765)
Yeah.

Dr Chris L. Brown (03:58.582)
How did you then think about that developing? then obviously it's a big step to go from just doing that work to then building a business around it the way in which you did. What was the sort of key insight?

Jim (04:07.999)
Well, it's a big step, a whole lot of little steps. One of the principles about business that I find is that it's not a huge idea. It's the thousands of micro ideas that make the difference. So when I was mowing lawns, I've been looking at things like, how can I make the edges perfect? How can I do it quicker? How can I pick up every blade of grass? How can I navigate between clients most effectively? How can I save myself one step, empty my grass bag and do that in the...

easiest way possible, just thousands of little tiny decisions. And see, when I started getting busy, I started trying to put people on. So I had put in subcontractors and then I experimented with that a bit and tried different things. And then I tried and I got into building up and selling lawn mowing rounds. Initially just my own runs, but I worked out how to do that. And I had to work out how to sell the lawn mowing rounds. I wasn't very good at it. didn't really have very good people skills. So I had to work out how to do that.

So I was gradually developing these systems and then in late 80s, I had this full-time business since 1982. In the late 80s, I'm faced with a competition from a franchise chain coming from South Australia, which is VIP. I basically franchised in self-defense. And not really thinking it would be as successful as it was. At the beginning, when somebody asked me, and I just looked at how many franchisees I might have one day, and I said, look if it works well.

I might have eventually as many as a hundred. I actually said that. I've got five and a half thousand, so it's done rather better than I thought. But it's always micro steps. Even after, I was surprised how well it did. After the first year I had like 60 and people were starting to investigate from interstate. was just surprising to me that it did so well. But even then...

Dr Chris L. Brown (05:37.282)
Yeah.

Dr Chris L. Brown (05:42.082)
Yeah.

Dr Chris L. Brown (05:57.272)
Yeah. Yeah.

Jim (06:01.511)
I still thought that was just a little thing on the side. I never thought it would really succeed. It took me like a decade to figure out this thing really has got some legs on it. I didn't really see it. And then the idea of going to different divisions and different states, different countries, just happened bit by bit.

Dr Chris L. Brown (06:11.084)
Yeah, yeah. It's amazing. Yes. Yeah.

Yeah, and a core part of your philosophy has been, you know, really delivering great customer service and engaging customers well. I where did that come from? Where did that develop from?

Jim (06:33.931)
It's an emotional thing. I just hate letting customers down. It's not really rational. It's not thinking that if I give great service, I get more money. It's thinking I just can't stand to let a customer down. I mean, I remember once I actually made a mistake in my bookkeeping and didn't do a couple of customers and I felt terrible about it. It was out of proportion to any personal damage. So I had that.

emotional thing. I was one of the first contractors in Australia back in the 70s as a part-time student with a brush cutter because I used to frustrate me. I couldn't do edges perfectly as I was always looking at how you can do the job better, how you can make the clients really delighted, how do you cut, how do you go into a lawn where the grass is like a meter high and make it clean. There's a way of doing it and I developed that. I try to teach other people. There's actually a video on my website about the system that I use and it's different. Most people don't do it.

So I just learn all kinds of ways to improve. But I think the big point about the big thing about Jim's is actually not so much customer services, it's service to franchisees. They're my primary clients. Now that doesn't mean I don't focus on customers. I do because...

Dr Chris L. Brown (07:45.442)
Yeah.

Jim (07:50.899)
The only way to get successful franchisees making great money is to give great customer service, both because franchisees who give great service tend to do better, but also if the franchisees as a group do great service, you get more leads. So as for example, one of the best things we ever did to increase the flow of leads was Institute surveys. So something over a decade ago, we actually started sending out

Dr Chris L. Brown (08:05.336)
Yeah, yeah, yeah.

Jim (08:19.013)
surveys to customers and we experimented different ways to do it to get better response. About 30 % will respond. Now that I thought might have an effect on leads but in fact it was way beyond what I expected because in the early days of the franchise we used to really struggle to get leads. We've got a problem even the last year has been less than our best year. We've had well over 200,000 unserviced leads and we spend less on advertising than we used to.

In fact, sometimes we can't even spend the advertising money. All of our franchisees and dogwatch got a free conference, know, fairs, accommodation, everything paid for by the surplus in the advertising fund we can't spend because they're all so busy. We've given back millions of dollars, unspendable advertising. I've just gone through and dramatically cut the advertising contribution from my fencing franchisees because we don't need the money. that change from focusing on customers means franchisees do better.

There's actually, if you see on the email I sent you, there's a little three line statement, which has been there since the beginning. Our first priority is the welfare of franchisees. We are all so passionate about customer service. You notice the emotional side of it. We sign only franchisees and franchisees always be convinced we'll succeed, which is not normal in service franchising. I was determined to do it. VIP didn't do it. Nobody else does it to my knowledge. Johnny King doesn't do it, but we...

scream at any franchisor who puts on a franchisee who they have any reason to think will fail. Heaven help them because they're in trouble.

Dr Chris L. Brown (09:56.002)
Yeah, yeah. They're your three values, aren't they, those three statements? And that last one, I mean, you're convinced are going to succeed, right? Tell me a bit more about that in terms of how do you sort of make those assessments? How are you thinking about that?

Jim (09:57.887)
Yes. Yeah, that's right.

Jim (10:16.031)
Well, interviewing is a good start. Looking at somebody, looking at what their background is, looking at the way they speak and communicate. I mean, we're fairly good at helping people who are into business who would normally fit paywall. I mean, just to give you an idea, you go into something like a cleaning or gardening business. They're different from retail businesses. Their value rate is between 90 and 95 percent in the first year. That statistic might be available.

failure, people who leave us in the first year, about 12%, which is not zero by any means, but it's a lot better. So we can help people to have got the basic willingness and ability to listen and learn and follow the system. We can help them to succeed, but there's some people just can't be helped. And you can pick that up in various ways. One of them is objective criteria. For example, you have a young man who is parents of buying the business, early twenties.

Now that is failure. That is just not going to work. And anybody who, we had one franchisor who actually did this, put somebody through, found out about it, I stopped it. And then when he came up for a new advice, said, you're not going to continue, you sell. Got a good price for his business. We don't confiscate, but it was an appalling thing to do. We had another person who was doing it who actually had a person who failed their trial. Put somebody out in the road, the person who took the round said, this person is not suitable, will not be successful.

the lady responsible put them through anyway, said just ignore that, put them on. I found out, gave them their money back and you're not going to sell any more franchises. So it's not normal. mean, Jarnah King is a highly successful commercial cleaning franchise and I used to employ briefly somebody who used sell franchises for them. And asked him, what were you told by your bosses as the criteria to selling franchises?

Dr Chris L. Brown (11:59.662)
Mm.

Jim (12:14.013)
He said $50,000 and a pulse. That's his words.

Dr Chris L. Brown (12:19.234)
Yeah, yeah, yeah. That's not really a recipe for success, is it?

Jim (12:24.071)
No it isn't. The point of it is if you sell a franchise to somebody like that you do get money from it and you get initial fees. But to me it's just fundamentally immoral to put somebody into business when you know there's a very significant chance they'll fail. And I just believe it's wrong. But it's also actually...

Dr Chris L. Brown (12:28.866)
Yeah. Yeah.

Jim (12:46.271)
foolish in a sense because the thing that sells franchises is happy franchisees. And one of the ways, the ways that I was able to, I was up against a much bigger competitor. When I signed my first franchisee, they had about 250 and I would, they had, you know, international, interstate and they had fancy offices in South Melbourne and I was running it from my basement sort of thing. People would say, why would I buy from you?

rather than them because they get better established. said, okay, there's some differences. Don't bag the opposition. Don't believe in that. But I said, here's this. Here's a list of my current franchises with their phone numbers. This was way before the franchising codes that you had to provide that, because nobody else did. So here's my list of my franchises with their phone numbers. I want you to ring as many as you can. Go and do your research. Then go and ask the other guys for their list, which I knew they wouldn't give them.

And the point of the fact is when people rang my franchisees overwhelmingly, said, this is a great system. You'd be crazy if you go anywhere else. Jim is good. He'll look after you, he'll train you. And the great majority were doing well. So putting on somebody who's not suited actually hurts you. It hurts you because you have poorer franchisees who are less happy. Reputation for customer service suffers. You spend a lot of time trying to help people who are really unhelpable.

get emotionally drained. There's all kinds of reasons why you shouldn't take on somebody you think might fail. But the main reason is you don't do it because it's just immoral. It's the wrong thing to do because somebody's putting their life into your hands and you're taking their money and you know there's a very good chance they'll fail.

Dr Chris L. Brown (14:30.286)
Lex integrity. And, you know, I think the model that you described there is the same model with customers, isn't it, really, in terms of thinking about the customer and it's the same level of advocacy that you'd want to see in the customer base that are receiving the service as well.

Jim (14:50.095)
We're very careful. mean, like this morning, for example, one of the things I've been doing is dealing with some very serious complaints. And there people who've been let down. We fix them. We just do. We have a thing called a warranty fund and we remedy clients. If something's gone wrong, the franchisee is responsible for fixing it. But if they've gone, disappeared, then we fix it. And that gets around. People recognize that we don't always do what everybody wants. Sometimes people demand things that

they think they should get, but it's not fair. Like we had a system of a irrigation system this morning, it just came up and it was leaking. Well, the question I want to ask the client, what was the warranty? This is a guy, this was done a year ago. The guy who did it has left us. So we're responsible, but what exact warranty were you given? So I asked her for the warranty document, what statement was made? And then the franchise all got involved and he said to her, okay, find out the equipment that's used.

there may be warranties on that. So it will help people but not unlimited. But there was another case where a franchisee was put up a fence, he took $800 deposit for, no it was more like $8000 deposit, it was was substantial amount of forget the amount, no it was about $800 for a fence and then he disappeared, didn't do the fence. So we cut to come in and say okay we'll fix it, we'll complete the fence, we'll give you your money back, whatever.

Dr Chris L. Brown (16:15.488)
Mm-hmm.

When you think about your own sort of history, are there sort of some surprising insights that you've had over the course of the business around human nature and things like that? I know you've studied a lot in this area as well and epigenetics and all these other areas that you're involved in funding research. But what stands out to you? What's been your experience in terms of understanding human nature and how people operate?

Jim (16:47.435)
but you're talking about business or knowledge in general. I'm an avid reader. I would read or listen to a couple of books a week on average, as well as reading all the magazines and all kinds of things. I've got very different. One of my major interests is happiness. What makes people happy? And people are extremely deluded about that.

subject there is this very common idea that the way to be happy is to have more stuff. If you can get a better car or a bigger house or you more expensive holidays or better clothes you'll have a better life and it's actually got very little to do with it. In fact past about medium Australian income, happiness income has very little effect on happiness but to the extent it does it doesn't make people happier what works is experiences.

Buying stuff itself has very little impact, having good experiences does have a help because we're very communal as a species. So what really matters is how much relationships we have, how strong we have family, friends and so forth. So people who are strongly connected have strong bonds.

tend to be better off. Churchgoers in particular, those who've got some sort of religious involvement, faith involvement, tend to be much better off. Married people better off than singles. There's a whole lot of stats about that. And then there's things like exercise, which is really, really important. I have very strong exercise habits, I have for decades. And then controlling your diet and then avoiding, you know,

negative things like alcohol and drugs and cigarettes and so forth which affect your mind as well as your body. There are principles to happiness that I'm very interested in and then you can understand this in terms of the way that the dopamine system reacts. The things you do that make you feel better in the short term can actually have a very bad effect because they tune down the dopamine system so you respond less well to pleasurable things.

Dr Chris L. Brown (18:57.442)
Yeah, yeah, there's a lot of that happening in today's world, isn't there? There's a lot of these, these, you know.

Jim (19:01.789)
Yes. Well in a sense it's what we're doing it's it's the same reason as cocaine doesn't work. You know people say why doesn't cocaine make you happy? Well there's a very simple reason because when you take cocaine you get a burst of dopamine that's why it feels good. But what happens is your brain gets out of balance it says hey there's all this dopamine coming in that's too much so it dampens down the dopamine system so it's less effective and that's why the next time you have to have more cocaine and more and more and eventually if you don't have it

dopamine system is so dense, so inactive, that normal life feels boring and spiritless and pointless and anxious and depressed. So you need the drugs just to have more, just to feel normal. That's why addiction is such a problem. People end up dying so often from it because it's really destructive. In a sense, that's what's happened to our whole society. Now everything from

from junk food to video games to so much of social media to porn to all these kinds of things do the same kind of, they're like a sort of a small scale drug. And what they're doing to us as individuals in society is they're dampening down a dopamine system so that the things that are life should be pleasurable like getting involved in a meaningful work or family, children, community.

service become boring and interesting and rewarding and you want more and more stimulation and excitement and stuff but that makes the whole problem worse.

Dr Chris L. Brown (20:35.69)
Mm-hmm. Yeah.

Jim (20:37.343)
So what we're doing in my research foundation is looking to ways to reverse that, to actually make, re-energize the dopamine system, to make it work better, so that people will be happy doing good things in life.

Dr Chris L. Brown (20:49.998)
Yes, yeah, and being productive. When you think about your own leadership style, I know you've sort of probably talked about servant leadership as being a way in which you see that. Can you tell me a bit more about how you see your own sort of leadership style and way of leading the organization?

Jim (20:59.933)
Mm.

Jim (21:09.427)
Well, the idea is, you know, it's from John's Gospel, Jesus washing his disciples feet. That's sort of the paradigm of leadership. is, in biblical times, washing somebody's feet was a very degrading, dirty job. It was the thing that slaves and the lowest people in society did. So when Jesus, the night before he was betrayed, actually washed his disciples feet, they were pretty shocked by it. It was so extraordinary. But that was that...

idea that when you're the leader you're there to serve and I see that with my franchisees. Look I'm a very strong willed person. have very people often describe me as a force of nature because I'm so determined. I just want to do things but at the same time that's my role basically is there to look after my franchisees and make them happy and emotionally speaking as well as morally that's what drives me.

I get my phone number, my email address to every franchisee and I ask them again and again, call me, contact me, respond to me. I send them letters after one month, they ring people after, on anniversary like 10, 20 years and this kind of thing. I do everything I can. I would have contact with multiple franchisees every day. So I...

It's the attitude, it's the moral purpose of your life. And life should be lived with purpose. It's not there just to enjoy yourself. Now, happiness will come out of that, but it's not the primary goal. So my purpose is my family, it's my franchisees, it's my research, my research project. I'm a very happy person, but happiness is never, never should be the number one thing.

Dr Chris L. Brown (22:55.854)
I know you talk a lot about character and developing character. How do you think about that? What's the process of that happening? How does that develop and so on? How do you see that process?

Jim (23:10.387)
Well, character is all about doing the things that you don't necessarily want to do, that are important, that are worthwhile doing. Like just this morning, okay, I'm weak as anybody in a lot of ways. I don't always do the right thing. I have terrible weaknesses. I love chocolate, for example. I mean, can't have it in the house. Anybody that just gets eaten, it's like, don't have it. If you want me to tell my wife, you want me live a long life, don't put chocolate in the house.

Now I'm also lazy, so I've had this system that I've received some input from my research team on the book that I'm writing, The Birthrate Crisis, which is due out towards the end of this year. And I couldn't get myself to get to it. It's lazy, there's other things I want to do. Business is a easier than the research it takes. This morning I just, okay, get yourself down to it, Jim, do it. So I actually did it and I got into this and I had some really great stuff.

I'm about to have lunch with my research head shortly, we meet every fortnight. so that was kind of, that was great, but it was very difficult for me because I would rather sit down and play some silly computer games or do something else that, you know, it's easier. But now that I've done it, I feel very good about it, but it wasn't easy to do it. Now that's in a sense what character is about. It's doing the things that you need to do that you should do as against the things that you immediately want to do.

Dr Chris L. Brown (24:23.544)
Yeah.

Jim (24:37.151)
And that applies to everything. It applies to exercise, to diet, to living life of service, to helping other people, to not taking shortcuts, not going for the quick money or whatever you're after, the quick pleasure, but disciplining yourself. And what we're trying to do is teach other people to do that. Like I was having dinner with my 15 year old son last night and we're talking about charitable giving.

I actually give away about 90 % of my income, which sounds an awful lot, but in fact I've got a lot of money, so the 10 % left is more than adequate. But then we were talking about charities and so forth, so I said to him, okay, you've got... He was talking to me about how I should be giving money to other factors rather than my research, other sources, and I said, well, what about you, Aaron? What are you doing? Are you giving money away? Well, apparently he's not.

I said, well, here's a challenge for you. know, 10 % is a good guideline, because I believe in tithing to give 10 % to the church. I said 10 % is a good guideline, what about you thinking about that? So I kind of put it on him and do something difficult. Even when he was eight years old, he's a great kid actually, but we used to go on a fast together. So for a whole month you can't eat any usually no sweet things, no desserts, nothing like that.

Dr Chris L. Brown (25:48.194)
Yep.

Jim (26:03.615)
we did it together as a sort of a discipline. So I try to teach that kind of idea, do the things that's difficult but good long term. It was interesting too the whole process with Aaron because he he put it very very hard, very very hard, he really wanted it and I said Aaron it's your decision, you can have this stuff if you want to but he wouldn't and he stuck this out and you know

And then we'd have a celebration at the end of it. He could have a party, anything he wanted. It was just a celebration. So we'd have, you know, desserts and soft drinks, which we don't normally have. But that was a celebration. But you know, that sense of achievement that he had was very powerful to him, very meaningful. He actually said to me, I wouldn't mind doing another fast, you know, later in the year kind of thing, because it was such a great experience, even though it was so difficult. And it's doing the hard things.

Dr Chris L. Brown (26:57.954)
Yeah. Yeah, yeah. Doing the hard things are the most rewarding.

Jim (27:03.359)
Yeah, and you look back on them and that's really what's great. I do feel so much better about having done that work this morning which I've been putting off. I don't put it off for a day I must say, but it was still something going on. I was pushing myself to get down to it and sometimes I kicked myself. used to say, you lazy sod, get out and do something. What are you going to do with your life? I really beat myself a lot of times.

Dr Chris L. Brown (27:11.241)
Mm-hmm.

Dr Chris L. Brown (27:16.59)
Good.

Dr Chris L. Brown (27:24.46)
Yeah, yeah, yeah, yeah, yeah, it's a bit like a friend of mine and I, talk about sort of eating a frog, right? It's the sort of doing the hard thing sometimes, right? Is what you need to do.

Jim (27:37.503)
There are some wonderful books like Tiny Habits or Atomic Habits on this kind of subject and to me it's about health and stuff but it's also a moral thing. It's doing the things that you should do with your life and that is the secret to a good life. And it's so different. People have no idea of this. They really think if I just have more money I can buy more stuff, more money and I'll be fine. And that's ironic because

Dr Chris L. Brown (27:44.354)
Yeah.

Dr Chris L. Brown (28:03.406)
Yeah.

Jim (28:06.463)
People only talk to me because I'm rich. I'm not as rich as I seem, must say. Not nearly as rich as I would appear to be, but they do. But my message to them is not really the main thing. Forbes came out and done the series, done the interview with me, the Wealth magazine. I said to them, first I said to them, it's really, I'm an odd person for you to talk to because I don't really care that much about becoming rich. If I had to put a list of priorities in...

Dr Chris L. Brown (28:18.691)
Yeah.

Dr Chris L. Brown (28:22.542)
Mm.

Jim (28:35.795)
don't even think about making the top 10. I needed to do things like my research. I can spend 3 million dollars a year on my research because I've got money, but it's never my goal by itself.

Dr Chris L. Brown (28:38.136)
Yeah, yeah.

Dr Chris L. Brown (28:48.014)
And, know, sort of back to the business side of things, when you think about some of the measures that you put in place of success, you know, most businesses would say, well, I'm just, I'm focused on revenue, right? This is revenue and profit. But you've got a strong emphasis on customer satisfaction, I imagine. Is that right? In terms of...

Jim (29:12.223)
Yeah, yeah. People often say to me, aren't you proud of having five and a half thousand franchisees? And I say, well, not really. The thing that really makes me proud of anything is when I hear stories about franchisors or franchises looking after each other, when they adopt these kinds of values. don't. Look, we do celebrate milestones to some extent, but if you've asked me what my goal in business was, I could tell you very simply one goal that was far more important than anything else. I would want to have

every single franchisee of Jim's happy with their business. That will be my overwhelmingly best goal. And what's my second most important goal is that every client of Jim's will be happy with the service that they get. That is kind of the way that I think. I don't think in terms of revenue, profit, growth, primarily are those goals. Now we're doing some software development right now. We're about to launch a new tool.

software tool for franchisees, we call it Jimbo, which we've been trialing and testing for a long time. By the end of the year, I would expect that our complaint rate will have dropped to less than half of what it is now, just with this new software tool. Maybe I'm optimistic, but there's a whole sort of thing, because I deal with complaints every day. It's one of my things. And I see what goes wrong. So I'll give you an example.

One of the major problems we have, the single biggest complaint is franchisees don't call back clients within two hours as they're supposed to. They should call them back within two minutes. That is your single number one complaint. Also a problem with that, if they do ring them back and they can't get them, they're supposed to send a text. Now, so what are we doing? First of all, we're setting up a system so that if the franchisee, we know where the franchisees call back. If they don't call back within half an hour,

get a message which is actually initially in my voice. Ring the clock. If it doesn't do an hour there's a second more urgent message. One and a half hours there's another message and at two hours I yell at them basically. That's how it's set up. Now whether they'll get that rid of it and put other things I don't know, now again if they don't ring within two hours message comes back to us. So we know what's going on wrong or we can possibly freeze their leads, chase them up. What's happened? How are you going? Okay, immediate

Jim (31:32.639)
Now later in the year, what we want to have is a system we've planned out where the jobs can be booked into a franchisee's diary. So when a client rings us up or books online, instead of being told somebody will call you up in two hours, they'll get a message to say, would you be available between two and four this afternoon? And they say no, well what about tomorrow morning between 10 and 12? Because we'll know where the franchisee is and how much work they need and that's their option. So instead of...

you would completely avoid this problem of people ringing back by eventually booking a job in straight away. And what that would do is increase your conversion rate as well as reducing customer time. Now this is all immensely expensive. We spend multiple million dollars a year on software development to get these things to happen. And there's a lot more than that too. When they do can't get onto a client, then they press a button and it sends.

Dr Chris L. Brown (32:19.842)
Yeah, yeah.

Jim (32:27.231)
the right kind of message to the client. He texts them automatically and then there's ways of handling them, not turning up to a job and all kinds of things. Look at the whole process of things going on and saying how can we improve it? And because I'm so obsessed with customer service and I'm always dealing with complaints all the time.

Dr Chris L. Brown (32:44.462)
Hmm.

Jim (32:45.597)
I know what to do about this stuff. But that's the goal. And then if I can get my franchisees to give much better customer service, I know what's going to happen is they're going to make more money. There'll be more leads coming through. They can get higher. They can charge higher hourly rates. Because when it comes to a conflict, like one of the things customers want, they want a lower price. What franchisees want is the highest possible income. Well, my priority is franchisees. So provided you've got enough work.

Dr Chris L. Brown (32:47.746)
Yeah.

Dr Chris L. Brown (32:55.426)
Yeah, yeah.

Jim (33:14.183)
charge what the market will bear. client doesn't want to hear that. They want great service but they it cheap. But my franchisees need good income and that's my top priority.

Dr Chris L. Brown (33:23.404)
Yes, yeah, that makes a lot of sense. When we interacted on LinkedIn, you were straight away instantly back to me. And I found that with customer-centric leaders are very, very responsive. They're quick, they're fast, they're on top of things. Where does that come from? Was that something you learned or was that always been there? You've always been very responsive and so on.

Jim (33:43.785)
Yeah.

Well, it's very useful to do that kind of thing too. I mean, you're a very important person to me to speak to. I don't know how, what your audience is going to be, but I can potentially reach thousands of people by an hour of my time. That is extremely good. From my point of view, it's good value. So you're a very important contact. Sometimes somebody might actually contact me and they've got a potential for new division. Now most of them don't go anywhere, but sometimes we do start new divisions and then that's...

enormously important. You can have, you know, hundreds more franchisees and just because I respond. I'm actually completely shocked at how poorly so many businesses respond. We had a case a couple of years back where we were looking for a consultant to do it. When talking about a six-figure job, okay, now I got a list of six people recommended to me, companies recommended to me, and I contacted them all by email.

by the proper email that was supposed to. You know what? One responded three months later. Isn't that lunatic? How on earth can you run a business when you don't even respond to your own emails?

Dr Chris L. Brown (34:59.328)
It's amazing, isn't it? It's amazing.

Jim (35:01.055)
I'm astonished actually Chris when I see how badly businesses are run. I don't think I'm all that brilliant. I just think so many people are so terrible at what they do. The most basic stuff, not answering emails. Who could do that?

Dr Chris L. Brown (35:11.533)
Yeah.

Dr Chris L. Brown (35:16.184)
Yeah, yeah, yeah. That's foundational, it?

Jim (35:19.549)
Yeah, I answer my emails every day. I clear my inbox at once a day, usually several times a day. I clean just before getting on this tour. It's all gone. Everything that's been asked me to respond to has been dealt with in some way or other. That's franchisees, clients, internal departments, whatever. It's all dealt with. I have a very efficient way of dealing with it. I start from the most recent. I do something with it. You don't skip down the thing. There's a process, just like there was knowing Lawrence. There's a way of doing it.

Then I unsubscribe to stuff and I get people to do other things and I do all kinds of stuff to make sure it's on top of it. But I always on top of my emails and communications. I can always be reached. Any of my franchises can reach me anytime. They want help, they get it. Decisions get made. You just got to be disciplined about how you do things. And it's such a simple thing. It's not that difficult to do. Yet people get buried under these piles of emails. They just live them and they don't hear really important stuff they need to hear.

Dr Chris L. Brown (36:03.18)
Yeah, yes.

Dr Chris L. Brown (36:11.202)
Yeah.

Dr Chris L. Brown (36:17.89)
Yeah, yeah, yeah. Just on that and the technology side of things, obviously, I've been running a course at University of Technology in Sydney on artificial intelligence and how it's being used and it's obviously rapidly developing each week. I imagine that some of that technology is something that you're looking at and using as part of some of your systems to enhance what you're doing. Is that right?

Jim (36:45.503)
Well, we're starting to look at it, yes. Not so much in the IT systems. In fact, the kind of stuff we need to do in IT is technology that could have been done 10, 15 years ago. It's not that special. mean, like a thing like booking a job into a franchisee's diary. I mean, that doesn't require any level of AI. It just needs to know where they are and how far apart they are. So, you you're over here in the afternoon. This client is, you know, 10 minutes away from there.

Dr Chris L. Brown (36:47.31)
Yes.

Jim (37:11.657)
So we know where they're at. That's simple stuff. You don't need AI for that. We are using it in various ways. I've got a wonderful young man, Joel, who looks after social media. If you've seen anything about Jim's on social media, but Tim, not me, I didn't even go on social media, but he handles it all. But he's very interested and engaged with AI. He's like...

32 or something, so he's buying an age group and he's always pressing it and looking at ways to improve what we do and using AI and stuff. I got some great stuff.

Dr Chris L. Brown (37:40.226)
Yeah, yeah, there's been talk certainly in the customer experience, customer service industry of some of these AI tools, you know, taking over and so on. But what's your view on, you know, how they interface from a customer service point of view? I mean, are they a value add or are they, you know, I guess what's your perspective on it?

Jim (38:03.807)
I'd see it very difficult to, we're a long way from the situation where an AI can replace a call center operator, for example. Still half our leads come from the call center and they're the best quality leads because they tend to be, if you go online, people often tend to put multiple services in, where if they ring us, it's usually at least they'll ring us first or often only us.

I would think it'd be difficult. I have experience of ringing up and trying to talk to some of these banks and so forth where they've got this AI stuff on which tries to get me to complete something. They just don't understand it. They don't get it right. It's just maddening. They're nothing that you say because it doesn't fit what you're talking about. I think they're a long way from being useful. look, AI is absolutely fantastic in some ways. For example, this book I'm writing, A Baby,

Dr Chris L. Brown (38:52.152)
Hmm.

Jim (39:01.723)
birthright crisis. Now it's particularly relevant to certain countries like South Korea where it's disastrous. Their fertility rates like a third of what needs to be Japan, Taiwan, China, Eastern Europe. Now one of the great things about what we can do is that it's now very very cheap and simple to get a translation done. Even if you just give them the text they can do a

verbal, they can read it, they can read the text. I've had it done actually, I've got the, I've had my book, now I actually did the recording of my own book myself, but you can actually get an AR to do it, they even put an Australian accent, they even can put your voice in to some extent, to actually read the book, and they can do it, or they can do it in a different language, I mean this is extraordinary stuff. So what it means is that when we, we're going to put out an English edition,

Dr Chris L. Brown (39:35.405)
Yep.

Dr Chris L. Brown (39:50.082)
Yes.

Dr Chris L. Brown (39:54.531)
Yeah.

Jim (39:59.081)
first priority, but we're also going to have probably Japanese, Korean, Mandarin, Hungarian, Russian, Greek. We're going to have all kinds of different versions very simply produced. That's AI and that's amazing stuff. They have me talking in perfect, unaccented Turkish for heaven's sake. I don't even know a single word of Turkish, but it's great stuff. There are some brilliant things. And when I'm writing the book too, there's a program called Hemingway.

Dr Chris L. Brown (40:20.14)
Yeah, yeah, yeah.

Jim (40:26.355)
which actually allows you to look at it and then you can, it suggests a way of simplifying the language and cutting the sentence down, which is quite useful because you've got to write very clearly concise sentences and so forth and picks up problems with expressions. So there's some amazing stuff around and it's getting better. It's exciting actually.

Dr Chris L. Brown (40:33.634)
Yes.

Dr Chris L. Brown (40:45.644)
Yeah, yeah it is, it is. Yeah we've been playing with some of those tools. I've got my voice in a system that can actually replicate it and similar to you, speak in different languages that I've never spoken into. I should be able to speak French but I don't. My mother's French but I can with AI's help.

Jim (41:00.169)
Yeah.

Jim (41:06.959)
Yes, that's right. It's exciting stuff. There are some very, very interesting things coming out. At the same time, we won't need less people. We just need people with different skills, people able to do different things. And I do think, too, one of the things I often say is that the home service industry is probably one area that's going to be the hardest in the world to automate. You could have a sort of robotic mower, but someone's got to set it up and supervise it and do the edges.

there's all kinds of issues. So we're one of the ones we think is, we do, we benefit enormously from technology. I mean, what we do with gyms would not be possible. just example, when a job comes into the system, the system looks at it and says, who's available to do this job? Let's say it's a lawnmine job in Paramatta, for example. Okay. Now what the system will do is to look at everybody who's down the lawnmine jobs in Paramatta. Now they might be down for

Dr Chris L. Brown (41:35.662)
Mm-hmm. Yeah.

Jim (42:04.447)
Not down for gardening, but they are down for lawn mowing. So it knows individual people. It's different for every division. And then you look at, who's actually taking work today? Who's taking work right now? And that cuts it down. So you might have 25 people there. There's only two that are actually available to take the work and you know who they are. And then you make a decision first of all, if the territory, how do they get it? Otherwise you look at who's had the fewest jobs in the past three days. And if that's the same, then you look at who's the closest.

So you've got this whole technology to with making sure the job goes to the right person, which is one way you can give good customer service because you know exactly who needs work.

Dr Chris L. Brown (42:38.52)
Hmm.

Dr Chris L. Brown (42:42.774)
Yeah, it's a great example of a powerful way to use technology, isn't it? To be really. Yeah. Yeah.

Jim (42:48.447)
That's right. Now, if you tried to do that manually, it would cost more than the fees we charge. You just couldn't do it. It's just too laborious and time intensive. And the franchisees can actually put their leads in. They can ring the call center, but normally they just do it online themselves. They can change their work requirements.

Dr Chris L. Brown (43:03.202)
Yeah, yeah. Well, you know, over the years, you know, it's not all smooth sailing, as anyone in business knows. What have been some of the biggest lessons for you, I guess, over the years? What are the things that stand out where you've learned the most, I guess?

Jim (43:12.671)
I'm from it.

Jim (43:22.355)
Well, the biggest mistake I make, and unfortunately I have to say I do it fairly often, repeatedly, is I go into businesses that I don't really part of my core. Over the years I have tried so many things, mower shop, computer sales shop, this is all alongside the mowing business, then tourist venture.

trade exchange on more than one occasion, factory, setting up a institute for teaching people psychology. I mean, that's just some of them. the universal result is I tend to do badly and lose money at it. My wife is always telling me, because she's involved with me in the business, you know, got to stop doing this sort of stuff. Don't do anything. Don't get too enthusiastic. I get crazy about something and I just want to dive in and I make decisions very fast.

So that's probably my single worst issue. do make mistakes. Sometimes I just make rash decisions. I decide things very fast. Usually it's a good thing, but sometimes you make very bad decisions too. And you look back and you go, this is so stupid. I think I've made more terrible decisions than any normal 10 people in their whole life. I mean, honestly, it's, what can I say?

Dr Chris L. Brown (44:31.522)
Yeah.

Dr Chris L. Brown (44:37.39)
It's interesting that because I think that's part of growth though, isn't it? And development. think what I found just in interviewing lots of leaders is that they would say the same thing. They feel like they make a lot of mistakes, but at same time, you're having a lot of, you're having a lot of goes at things, aren't you? So, you know.

Jim (44:57.794)
Yeah, look, I know so much more. I'm 73. You know, if I knew when I was a mere kid of 60, 65 or whatever, some of the things I know now, I'd be so much better off. And just keep on learning, which is good. In fact, that's one thing I suppose, longer you live, until your energy starts to go down, which it hasn't for me yet, you just get more and more experience. You just learn, you know, I don't do that because that didn't work out last time when we tried it. Do it this way.

Dr Chris L. Brown (45:07.362)
Yeah. Yeah. Yeah. Yeah.

Dr Chris L. Brown (45:17.101)
Yes.

Dr Chris L. Brown (45:23.33)
Yeah, yes, yeah, yeah. That prompts me to think about, you know, if you were start again today, if you're starting from ground zero with all your wisdom from the years, I mean, what would you do differently do you think that might surprise people?

Jim (45:44.211)
Well, that's what you're talking about. If I'm going back in time to when I first started Jim's mowing, I would do monumental things differently. I would franchise earlier. I would understand that the, I would invest in technology earlier. I spent too much time running about contracts and stuff, which are really pretty irrelevant most of the time. I could have written myself in a few pages and it would serve the purpose quite well.

I would know how to look after franchise, but I didn't understand what proactive calls, which is ringing franchise. I didn't understand how important that was. We only learned from experience, but looking at different people, I would understand the value of meetings more. I would have got better training system in place earlier. had a dramatic, when we started doing proper centralized training, we actually had a dramatic improvement in, our attrition rate dropped from about 70 % to 10%.

you know overnight, but for our first year attrition rate as soon as we started doing proper training so I would have done that earlier. I would have appointed different people. I find it very hard to find the right people in some things. I find it's often better to promote from within so you find people are already working for you. My best managers tend to come from the shop floor, the people who've actually been with me the longest. Like Joel for example is somebody who started

12 years ago in the most basic job you could possibly imagine. This guy's got no experience, no degree, no nothing. He's absolutely brilliant, but he's grown up through the system. Well, Megan, who's a wonderful lady who runs one of my departments, and she's like in her 40s and she's never had anything more than a base level job in her life. But she's now one of my top managers. She's just got it. So I find people from...

Dr Chris L. Brown (47:14.977)
Yep.

Dr Chris L. Brown (47:29.934)
Mm.

Jim (47:32.635)
inside are often the best. Our call center is often a good way of creating people too. We get people in the call center and they prove themselves there and they go on to other kinds of roles within the company. One of my top people come from the call center so that's one lesson I'd learn. I would start, I would read a lot more. I only started recently with iPhones and stuff. Talking books and stuff is brilliant.

Dr Chris L. Brown (47:38.53)
Yep.

Yeah.

Jim (47:54.295)
I go and exercise in the morning, which is about 40 minutes running and weightlifting, and I'm listening all the time, talking books and driving all the time, talking books. The value of that is just phenomenal. There's just so many things I just didn't know. You spend decades learning how to do things properly.

Dr Chris L. Brown (48:06.164)
Mm. Yeah. Yep.

Dr Chris L. Brown (48:13.89)
Yeah, yeah, yeah, no, that's great, that's great. Any other sort of areas that we haven't touched on that sort of are important to you in running the business? mean, probably something I haven't asked you about is how do you think about culture in the business? Is that something that you think about sort of specifically or, I mean, you've got a very clear set of values in terms of what the priorities are and.

what's important and you obviously live those values and people see how you operate. But how do you think about that?

Jim (48:48.367)
Culture is crucial. Culture is the hardest thing to get across. look, if I took pride in anything, it's the fact that in general, my people in gyms have adopted my culture. Overwhelmingly, they're like that. We had a guy called Brian Duckett, was from the UK, who came to one of our conferences in Queensland, and he'd experienced this with dozens of franchise systems over the years.

And he came to our conference and he said he'd never heard anything like it. The culture was totally different. And the overwhelming thing was concern, genuine concern for franchisees. during COVID, we had in Victoria, we had this ridiculous lockdown where we couldn't work for two months. Crazy, made me really furiously angry because it was so senseless and so harmful. Now we didn't charge fees, obviously.

No, who would suggest that you would charge fees to a franchisee who couldn't able to work would be considered insane in our system, so he didn't. But you know what? The franchisees were not getting paid, they had no income. But as far as I heard, they worked harder than it ever had in the past. They were talking to the franchisees, they were reassuring them, they were counselling them, they were doing what they could with them. They really worked, despite the fact that they weren't getting paid. Not only that,

But heard so many stories of franchises helping each other. So for example, there was a girl who was in dog wash who was a student. She had no income at all. So the government says you're forbidden to work, you can't wash dogs, but I'm not going to give you any money because you're not a citizen. So she's faced with addiction, she's faced with doesn't got any money to buy food. What can she do?

Now other franchises gathered around, they gave a meal vouchers. We said to her, you run short of money, come and stay at a conference center because it's empty. So people looked after her and people would ring me up and they'd say, look, I've got no money, but no income. I'm not, I remember a test and tag guy actually rang me up during the COVID and he said, I'm not working, but I'm in a good financial situation. Who needs help? And then we had things.

Jim (51:01.097)
We had a terrible, terrible thing that happened where one of our franchisees went crazy and killed his wife and his little daughters. I mean, it was awful. I went over to Perth to talk to them about it what happened and how we could avoid it. And they came up with all kinds of ideas about what things we could do. Like we now employ a counselor to give free counseling advice to any franchisees.

our franchisors in mental health and we do all kinds of things but one of the things they suggested at the time was that what if franchisees would act as mentors, unpaid mentors to help franchisees who are struggling and I said that's a great idea but that's an awful lot to ask for no return. I said who would agree? You know what most of the people in that room put up their hand it was most of the franchisees in the state because they were concerned about each other.

Now that's the sort of thing you really can't buy that. But somehow, because I preach it and I talk about it, and I'm a sadly flawed human being in many ways, but I really do believe in these things and I talk about it a lot and it does tend to come across and it spreads through the organization. And you know the hardest thing about stretching gyms overseas, which we like to do, is that it's very, very hard to take the culture.

Dr Chris L. Brown (52:21.376)
Mm-hmm.

Jim (52:21.695)
We've tried it and it's just difficult. If they don't come to the training, if they don't meet me, if they don't hear from me, if they don't get involved in what we do, it's very difficult. So we'd love to go into the United States and elsewhere, but it's so difficult to get people, because what people do to, when you're a franchisor, you tend to think of authority. You know, I'm in charge, you do what I say and they'll shut down opposition. Now we have,

elements in our system. For example, our franchisees have the power to change to a different franchisor within division or even do a different division if they wish to. They can vote out their franchisor, they can veto changes to their own manual. There's all sorts of things in the system they can appeal to me which is pretty powerful.

So the system is set up that way, but you've got to have the psychology behind it that says we serve franchisees. We are not the bosses. We don't jump down on criticism. We accept it. We listen. We learn. We don't get aggravated. We respond courteously, even in the face of aggravation, which is not easy. And I'm not, it's not easy for me either. I'm not a fairly passionate sort of guy, but you've got to try and get that.

sense of culture across it's really hard. But we've done it to an extraordinary extent. It really is. And I know I hear so many stories about that. There's so many wonderful people in the organization. I'm proud of that, more proud of that than anything. More proud of that than the income, than the numbers, than anything is when I hear stories.

Dr Chris L. Brown (53:43.689)
Mm, mm, mm.

Yeah.

Dr Chris L. Brown (54:01.006)
It makes me think about your franchise structure and your leadership structure where you've got the franchisors really serving the franchisees and they're really there to support them and they can be voted out and moved around. Is that right? Am I hearing that correctly? Yeah.

Jim (54:19.551)
Yeah, yeah, that's right. The franchisors, we serve franchisors too, but ultimately you serve franchisees first. it's not difficult. The voting out thing doesn't very happen very often because most franchisors are very good. They really care. We also do, we not only survey customers, we survey franchisees every year and that's anonymous. So if there's a franchisor who's not doing the right thing, not ringing people regularly, not being helpful, caring and stuff, it comes to come out of these things like that too. So there's a lot of...

Dr Chris L. Brown (54:28.259)
Yeah.

Dr Chris L. Brown (54:33.644)
Yeah.

Dr Chris L. Brown (54:48.374)
Mm.

Jim (54:50.271)
kind of institutional pressure to do the right thing. But even so, you've got to believe in it. If you don't really have it in your heart, you don't have that civic leadership thing in your heart, it doesn't help. But we do also tend to attract certain kinds of people. So for example, my book is fairly widely available, it's called various titles like Every Customer a Fan, this kind of stuff.

that tends to attract people. Some of their best people actually came to us because they read the book and they liked the values in the book. So we tend to a certain extent weed people out and also if you want to become a leader in gyms like a come from a franchisee to a franchisor or start a new division we're looking at things like well are you making money have you got great customer service but also what kind of person are you?

Dr Chris L. Brown (55:21.581)
Yes.

Jim (55:38.047)
Are you somebody who enjoys helping others? Do you have a reputation? Have you been doing that? So the kind of person who spends their spare time just mentoring and counseling franchisees who are new, and a lot of them do that. They just do it, not getting paid. They just do it because they're human beings. They're the kind of people we like to latch onto and say, okay, what about stepping up to the next stage?

Dr Chris L. Brown (55:54.572)
Yep.

Dr Chris L. Brown (56:00.418)
Yeah, I it makes a lot of sense. Makes a lot of sense. Well, thanks so much, Jim. It's been great to talk to you and it's an incredible journey that you've been on and continues into the future. What does the future look like, actually? It's probably a good place for us to finish up. What's the future look like in your mind?

Jim (56:22.871)
more of the same. I am, based on, on Google, you can go and you can look at your expected lifespan based on my personal habits and all kinds of things. I'll probably live another 20 years, most of which will be in good health. I don't have any intention to retire. I love what I do and I believe in it. I've got so much to do in the next 20 years. So I intend to forge ahead. I'm very concerned about the future, but I'm no longer around because franchise systems can be run by.

good people and then get bought out by some greedy financial parasite vultures like retail food group, for example, which did terrible things to so many Australian brands and hurt so many people. I'm so determined that won't happen. So one of the things in all of our new contracts, there's a clause that says controlling interest of Jim's group cannot be sold to anybody without the written consent of a majority of franchisees. I put that in last year.

which my CFO said that's gonna dramatically cut the value of business. And I said, good. I'm setting up a structure. My kids have a say in it. They get certain help with buying houses and things like that for kids. Most of the money will go to the research foundation, but my children will elect directors. The franchisees will direct and the research foundation will actually appoint a director too.

Dr Chris L. Brown (57:24.429)
Yeah.

Jim (57:44.701)
So there's a structure that's going to be set up by the family trust that will look after Jim's. And I run in such a way that the franchise is to continue to be looked after.

Dr Chris L. Brown (57:55.446)
Mm-hmm. That's great.

Jim (57:57.031)
And I've got some very decent kids and perspective in laws, sons in law, to whose I think we've got a very good chance that it'll continue. I don't want to be a public company. I think that looks for short term and we never think short term. You've always got to be able to make a decision all the time. What's right? What's the best thing to do? What's the long term thing? What's going to be good for the individual? Which means what's going to be good for us in five years time?

that's not the same thing as looking at the next. Look, I could double my income. I remarkably little money considering the size of it, considering we turn over close to a billion dollars a year. I make remarkably little money, but that's never been my goal in end.

What can I say? Somebody could do some really bad things if the wrong person got into control and that horrifies me more than anything.

Dr Chris L. Brown (58:46.028)
That's great.

Dr Chris L. Brown (58:55.18)
Yeah, yeah. Well, thanks very much for your time, Jim. I think we'll continue the conversation again, hopefully in the future, but I really appreciate it. Thank you.

Jim (59:05.575)
Anytime. Thanks, Chris.