Josh Fonger - Get Control Of Your System


Josh Fonger is founder and CEO of WTS Enterprises. Based on the book "Work The System" by Sam Carpenter, Josh helps ambitious business owners break free from the day-to-day by getting control of their systems. His specialty is taking stressed-out entrepreneurs from working "in" their business to working "on" their business using systems so that profit and freedom can become a consistent mechanical reality. He's personally helped over 1,000 business owners from more than 300 industries. In the real estate space, he's helped investors, property managers, flippers, wholesalers, real estate agents, and more. Find out how you can help work less hours and get more fulfillment in your life by applying Josh's teachings.

In this episode, you will be able to:

  • Achieve financial independence through strategic real estate investments.
  • Streamline and grow your real estate business using proven systems.
  • Discover the crucial role of systems in successful real estate investment.
  • Learn the "Work the System" method for substantial business expansion.
  • Attain a healthier work-life balance as a real estate entrepreneur.

The key moments in this episode are:
00:00:00 - Finding Balance in Business and Life
00:02:15 - Transition from Real Estate to Business Consulting
00:08:00 - The Importance of Delegating and Scaling
00:11:32 - Empowering People and Developing Systems
00:14:02 - Valuing Administrative and Operations Staff
00:15:11 - People as Assets
00:16:27 - Building a Great Culture
00:17:14 - High-Energy Time Management
00:21:40 - Designing Life Priorities

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Josh Fonger
You can work all day, every day, seven days a week, and still have work to do because you're really busy. But if you can first put in the ingredients that are essential to your family and your health and exercise and things like that, then that gives you parameters and boundaries for which you have to figure out, well, how do I run a business where I'm only working x number of hours a day when everyone else in my industry works? Two x.

Mike Swenson
Welcome to the REL Freedom show, where we inspire you to pursue your passion to gain time and financial freedom through opportunities in real estate. I'm your host, Mike Swenson. Let's get some REL Freedom together. Hello, everybody. Welcome to another episode of REL Freedom, real estate leverage Freedom, where we're helping people build time and financial freedom through different opportunities in real estate. I'm your host, Mike Swenson. If you're interested in getting started or looking for the next step on your real estate investing journey, check out our website, freedom through Lot of great content on there to hopefully help you get going in your journey. Now for today's episode, we've got a super amazing guest. If you're somebody that is busy in your job, right, either you're outside of real estate, you're in real estate, you have multiple streams of income, you're running into probably some sort of ceiling of achievement, and it's probably built around systems in some way, shape, or form. And so we've got Josh Fonger here. He works with investors, property managers, flippers, wholesalers, realtors, other entrepreneurs in the real estate space, you name it, in addition to other industries. But he is the founder and CEO of WTS Enterprises, which comes from the book work the system from Sam Carpenter. And I'm sure you'll talk about kind of your journey and how that came to be, but really, you help ambitious business owners break free from the day to day by getting control of their systems and helping them to scale and so coach and help people build their systems, help them scale their businesses to ultimately achieve kind of their time and financial goals. So, Josh, we're so excited to have you on the show. Just share a little bit about your background and kind of how you got into launching this company and your work with Sam.

Josh Fonger
Yeah, definitely. So actually, I'm not currently a real estate investor, but that actually was my goal out of college. I got a degree in architecture. Then I started working with a commercial real estate development company out of Phoenix and went back and got my master's in business. But as I was going up the ranks in commercial real estate. Ended up getting laid off in 2008, and at that time could not find a job in real estate. And had a couple of kids at the time, got four now, and I realized I had to make a pivot. And that's when I got into, which was actually not, wasn't my goal, wasn't my dream. Actually wrote an essay about why you should never hire a business consultant. So I wasn't really wanting that career, but I couldn't find anything else. And so started doing that about 15 years ago, and I really fell in love with it. Loved working with entrepreneurs, business owners, and kind of cut my teeth in that industry by helping people with inside sales and outside sales and their operations and their merchandising and financial forecasts and helping them through bankruptcies and things like that. And really enjoyed the work. I really enjoyed helping business owners. This is particularly small business owners make transformations to grow, to really get unstuck from where they were in business. And along the way, ran Ram Carpenter, the author of Work the system, and realized there was a piece in what I was doing that was missing, which was I would essentially fix a company and they would be off on their way. And then six months, a year, two years later, I would follow up with them and find out that a lot of the old habits came back. They had some great sales quarters. They were moving up, and then an employee left, they lost a vendor or whatever it was. Something bad happened, and they kind of went back to old habits. And I realized that I was not fixing the systems of the business. I was just fixing the problem that they presented me with. And Sam Carpenter's book, work the System, is all about those underlying systems that produce the results in business, in life, and basically documenting those systems, organizing those systems so that the infrastructure that a business owner builds allows them to scale and grow. And in his case, why people really love the story is that he went from 100 hours work week to a two hour work week and was able to grow his income up 20 times. And he wrote a book about it. Right? Hence worked the system. And so that's what I've been doing for the last ten years now, is helping companies. And a lot of them are in the real estate industry. So, yeah, lots of home flippers, property managers, investors, wholesalers, realtors, a lot of folks who do that work, I get to systemize their businesses, which is great. And then a lot of just people who, because they're entrepreneurs, whether they're dentists or they're insurance agency owners, whoever it might be they've grown their companies and now they buy some short term rentals or things like that. And so I help them make that transition.

Mike Swenson
Now, we know for a lot of folks that are maybe sales minded, entrepreneurial minded, they tend not to be as administrative minded. And so it's really kind of helping them understand you're standing in your own way a lot of times. And so it's having that person that can kind of come alongside that does, like, systems really thrives off of building those systems to help scale. But, yeah, kind of walk through what maybe that initial conversation looks like or how to identify those initial problems. What do you typically encounter when you have those first conversations with people?

Josh Fonger
Yeah. So usually people when they come to work with me, already skimmed through or read the book, worked the system. So they get the idea and they say, gosh, I need help. And so I only work with entrepreneurs who, for one, realize they're stuck, right? So they're working too many hours, there's not enough bottom line, they don't really see a path forward unless they operate differently. And you put it good in the introduction, like, they're maxed out. Right. They realize I can't really put any more hours in. And when I hire people, they don't do the quality work I want. They don't stick in the results I want out of my team. And so they never grow their team. Right. Their team stays small in whatever industry that is. But real estate, they may have a few folks, maybe a few family members that work with them, but they can't ever really build that team because they've never taken the time to build the systems. One of the first things I end up doing is making sure that the owner of the operation analyze their own life and how they manage their own time, because I usually find that they are wasting a lot of their time on things that could be delegated very simply if systems were put in place. And so a great example was a home flipper who also was a property manager, and he had maybe 150 units. And I'm reviewing, he was so busy, always stressed out, really busy. And I said, let's just look at some of your days. And I kept seeing like, Home Depot run Home Depot run, deliver this, deliver that. And I'm like, so you own this business. Why are you going to Home Depot to deliver materials? He's like, well, no one else can do it. And I said, I bet someone else could go to Home Depot and buy, well, you know, they wouldn't know where to buy it. They wouldn't know what. It's too important. I can't keep my guys moving on these properties. I can't, because he's flipping these properties. I can't let them just sit around and wait, and they're too expensive for them to. Long story short, we develop a quick little system. He finds someone who's $18 an hour. That guy does the runs for him. What do you know? He just freed up like 15 hours a week of his time. So now he takes those 15 hours of time, reinvest it into the next system, and then, of course, you can expand. And it depends on the entrepreneur whether they want to expand their business, they want to expand their free time, because people are different, I guess, different phases of life, whether they're in their 30s, they have different ambitions than when they're in their 60s in terms of what they want to do with that extra capacity of time and money.

Mike Swenson
Well, and I think part of it, too, is understanding that, like you said, I need help. For some people, it's seeing that growing something big actually can help you achieve what you want and not create too much stress. Because I think some people think big is bad.

Josh Fonger

Mike Swenson
Like, if I create something bigger, it's just going to be harder and more challenging. And so it's kind of finding that person that doesn't want to be the lone wolf or doesn't want to try to do as much as they can themselves. But they realize by building something, building that system, it actually can be easier. And I get more of what I want.

Josh Fonger
Exactly. Yeah. And there is this phase where if you're all by yourself, then great, you can make all the choices. You're never going to grow, but you have control, total control, because it's just you. Right. But there's this middle ground where you have a few folks and you're managing three or four people, and it's not a great phase to be in. But if you can get beyond that, where you have, I don't know, 20 people who are underneath you, and you have people that you trust, and you have some managers and sub managers, supervisors, then you can totally step away from the company, like Sam Carpenter writes about in his book, and have it run 100% without you and continue to grow. So there are kind of different phases. And I had one client who, real estate investor. And his big thing was auctions. That was kind of his model in second, and he realized he couldn't go to all these different auctions to all these rural areas. And so he developed a system so that someone could go to these things for him on his behalf. And then he developed a system so that instead of having to monitor all these different construction teams when they're doing their remodels, he developed a system where he could do that remotely from anywhere in the world. And that was the way he kind of grew from driving all over the place like a crazy person to being able to figure out a way to have the freedom and to scale. And I think that with modern technology, there's so many ways to take what, maybe traditionally 20 years ago, you really had to physically be there to make sure the work was happening. As you know, you could expand a lot more.

Mike Swenson
Now, even as a real estate agent, I know the kind of the older realtors talk about back in the day, you'd have to go down to your office to find the MLS book, to sit down with your clients, to be able to pick out the properties, right? And now, obviously, all of that's done on the Internet. Well, just think about how much time that saves you. And so it's just a natural evolution of technology now. You can do more and be more efficient with your time. Talk about kind of that balance of like, some of your systems are people, some of your systems are technology. And so helping people to kind of see how those can help. And it's not necessarily the entrepreneur coming up with a system themselves, but being able to work through people who can create those systems for them.

Josh Fonger
Yeah, definitely. So the larger your company gets, the more you're going to have specialized people underneath you. And so let's just say if you have a property management company, which several of my companies clients do, as opposed to you developing the system for the maintenance guy, the facilities guy, they can develop the system because they're actually the ones doing it. They're the ones handling the calls or the ones going out there to the job sites. And so a big part of our philosophy is not top down, where the owner has to develop and document and manage and run and maintain and oversee and measure every single aspect, micromanage their business, but instead to develop a strategy and a philosophy that empowers their people, even the lowest level new people, to be engaged in the work they're doing in a way that they see it as a process. They help document that process, and then they want to manage, maintain, improve and measure their own process because they care about the performance and long term viability of the business. And they only do that if you as a leader, give them a future with their business and you let them know that as this enterprise grows based on them getting better at their systems and running them, they're going to have a better future themselves. And so that's a big part. And the work, the system method is great for the owner, obviously, but the idea is the only way it can be great for the owner is the people think it's great, too. And so we try to really empower as many people as possible and bring them along to as high a level as they want to go. And again, like you said, if they'll be engaged in developing and implementing and optimizing the systems that they work in, whatever department that is in the real estate business, they're going to maintain it themselves as opposed to the owner, have to always be involved in trying to optimize it for them.

Mike Swenson
I love what you said there, giving people a future, because I think this is something that was surprising to me, getting into real estate. I came from a nonprofit company where it was kind of, we talked about our feelings all the time, and it was very personal and we felt like a family and that sort of thing. And I moved over to real estate and it was a little bit more colder, bottom line oriented. And yet what I saw was a lot of these administrative and operations type people are just treated like a disposable asset. Well, if you can't do it, I'll go find somebody else who can. And surprisingly, what happened is these people are constantly rolling through admin and operations staff because the operations admin staff don't want to be there because they don't feel valued. And so, like you talked about showing them a future, showing them a way that they can work up the chain. And it's a balance between, you don't want to over promise them the world of, like, everybody's going to be the next CEO. Well, there's only one person that can be the next CEO or the COO or whatever that might be. But showing them there's more to this role than just punch in, punch out, collect my paycheck, and I'm on my way. And so I think that's the key, is letting them feel I'm a part of this. We're growing this together. I want you to be able to hit your goals through working in what we're building together versus if you can't do it, I'll just go find the next person that can.

Josh Fonger
Exactly. Yeah. And we talk about real estate being an asset. I mean, your people are an asset. And if they're coming and going every six months, that's very expensive. To recruit onboard, train, manage, coach, and then have them leave. And one of the most efficient things you could do, obviously, is to obviously find the right people through a good recruiting system. But if you can nurture and maintain them and some people, their ceilings at different places. Right. And some folks, their ambitions differently, different. But once you gauge that if you can have a system that allows them to enjoy their work, do productive work, then they can end up getting paid more than they would somewhere else. And if they stay there longer, they're going to have more experience as well. And so it's natural to want to build systems where they can thrive. And most people are not like entrepreneurs. They don't want change all the time. They don't want variability. They don't want risk. They're content just getting better with they and being rewarded for doing that. And like you said, kind of having this family environment, if you're going to be somewhere 40 hours a week, they want to enjoy who they're working with. So that's a big part of work satisfaction. And there's a system for doing that, for making that happen repeatedly. And that's what we try to tell people is that a great business and a great culture don't happen by chance or by random chance. And you're also not going to just randomly have a successful business. You're going to have to build it. Right. And there's some key ingredients, and you want those ingredients to not just happen one month or one quarter or one year. You want to be intentional about building those things and then intentional about keeping those things thriving over the long haul. And just like a healthy person, you can't just go on a crash course diet and get healthy for one month and then forget about it a month later. It's not going to work. Your health is going to go back down. Same with any other business. Right. And I think that, especially people that I know who are entrepreneurs and real estate investors, they have a strong risk for searching out opportunities for making strategic decisions. And that's great. That's why they are in the position they're in. But to build an operation underneath them, they have to think differently.

Mike Swenson
You mentioned building a good culture. What are some tips that you can give with people that are like, hey, I think for a lot of folks that are high d driver type personalities, they like to move fast. It's like, well, how do I build a good culture? I can't just tell them, let's build a good culture. It takes time, right? It's softer, it's long, more future oriented. You can't just say, okay, now we've got a good culture. So talk about for people that may be wanting to strengthen their culture, how they could do.

Josh Fonger
Yeah, definitely. So in Stan's book, he calls it a working man's philosophy. As in, like, he's applied what's in a thousand books into a very simple recipe. And if you follow it, you will have a good culture. First, it starts by having a clear, strategic objective. So you and everyone else in your business knows, here's what we're trying to achieve. Here's how we're going to try to achieve it. Here's our ideal market, here's our unique selling point, just some of the basic elements of our business to keep us all on the same page. Here's how we're going to make decisions. And people like that, they like confidence, knowing this is the direction we're going to go, we're going to go as fast as we. This way, people will buy into and believe that this owner, this strategy makes sense. I think this is going know create a winning future. The next component that you put in writing is your operating principles. So just like some companies will have values or they'll have principles, Sam Carpenter calls them general operating principles. And these are guidelines for decision making. And they help mechanically build the culture of the business. So you might have principles that have to do with time or speed or customer service or loyalty or whatever the principles are that matter to you as the owner and to your customers and to your industry. You're going to put those principles in writing and then say, hey, what do you all think about running a business with this kind of culture, with these kind of principles? And most people are like, yeah, I want to work at a place like that. And then everyone starts to conform, their personality, their decisions, their beliefs, around these series of principles. And then you can hire based on them. You can coach based on them, you can fire based on them. You can kind of rebuke based on them. You can kind of use them to get people in line and like, hey, we're going to be an honest organization. You said you were there, but you were over here. This is how we run our business here, or we get the job done kind of business. And you left at 03:00 we had a big deadline that was due. You didn't go the extra mile to finish it. That's not our kind of culture. We're the kind of culture that finishes. These are the things that help guide how people make those gray level decisions. And you want to put that in writing so that the owner doesn't have to be everywhere to influence people all the time. They can have a document that can be everywhere influencing people all the time. And that's what makes the heart and soul and culture of a business scalable, is that it's not a person, it's now written down. And so we help build that infrastructure. So those are some two key components to making sure you actually are purposeful with your culture and it's going to stick for the long haul.

Mike Swenson
It's not just, hey, let's throw a casual Friday out there for dress and let's throw a pizza party. And now we've got a good culture.

Josh Fonger
People like that every once in a while, but it's not going to keep them there and they're not going to any more than that. Yeah, people are deeper than that.

Mike Swenson
So talk about kind of the journey from somebody working 50, 60, 70 hours a week. They're starting to implement some of these things, get more free time. Talk about maybe like systemizing the rest of their life. Like you've got a lot of stuff. If you've got kids and families and obligations and travel, how can they maybe work towards systemize that stuff too, to be able to focus on the things that matter most to them outside of their working life?

Josh Fonger
Yeah, definitely. The first thing I would say is that entrepreneurs, probably real estate investors, largely have a lot of flexibility. Like they don't have a boss, so they can do whatever they want, whenever they want, and therefore they usually just fill it up with busyness. And so the first thing to realize is that if you can optimize a part of your personal life, it's just as effective as optimizing a part of your business life, because time is time, right? So I'm looking at my pool right now. So if I spent an hour a week screwing up with my pool, and then I said, hire someone to deal with my pool, I got an hour back a week of my life, right? It's not my business, but it saved me an hour. I think that's the first thing is think about anything you do in your personal life that actually is not adding value. It's remedial, it's a low cost thing. And a lot of times you can hire things in your personal life for cheaper than what you could hire them in your business life. And so that's kind of the first thing I think about is how to do that. Secondly, oftentimes people are not sequencing their life properly, so they will do the wrong work in the wrong time period of the day. And so I like to figure out when people's energy is their high energy and low energy. And I like to figure out what work they're doing during this high and low energy time. And usually I find out that they're not doing the right tasks, the right projects, the right initiatives in the right time of the day. So just shifting that around can make a huge difference. Then we go into optimizing and batching and automating all these different things. But I think these are all tactics, I'm telling you now, but they always go back to what is the tactics have to follow in line with your end goals, and your end goals are going to be that company strategic objective and then your personal strategic objective. Our family is very unusual. Most families probably are unique in their own way. But we've got four kids. We home, school, our schedule is very dialed in because we're trying to achieve certain things with our kids, certain things with our families, with our family. And so we know that this is the recipe to make that happen. Right? So right after this, I'm going to go in an afternoon and date my wife. We're going to go for a hike, right? So that's part of our thing, is going to date. But we're not like date out in the city. We're like, we're going to go out in the woods and hike in the middle of the day. That's our dates. All right, so we prefer that. So that's part of the recipe. Like building evening prayer time with our kids. That's part of the recipe. So what I think for I would say busy entrepreneurs who are very ambitious about money and success in their business is if they want to not screw up their family life, is adding the ingredients you want to build the family. And I would say husband wife relationship that you want first and then build your business around it, you'll end up being happier than going the other way around because usually the family will take whatever the leftovers, right? And that's no good. And so I always tell people to kind of build the other way, and you'll get more efficient, you'll get tighter. I have an accountant I'm working with right now, and that's exactly what we're doing is as an accountant during tax seasons, you can work all day, every day, seven days a week, and still have work to do because you're really busy. But if you can first put in the ingredients that are essential to your family and your health and exercise and things like that, then that gives you parameters and boundaries for which you have to figure out, well, how do I run a business where I'm only working x number of hours a day when everyone else in my industry works two x, right. And then you start to think more creatively and more about delegation and more about automation and more about increasing the value proposition to your clients and possibly raising the prices and just things like that. That I think a lot of times people, they just get stuck in what is the industry average, what's everyone else doing? And they just do that. That's good.

Mike Swenson
I mean, that's kind of a good summation. There is really kind of designing what you want out of your life with all your other priorities and kind of backend your business into that and then work on your business at the same time. So awesome stuff, Josh. Really appreciate everything that you shared. For people that want to reach out to you, learn more about what you're doing, how can they do so?

Josh Fonger
Yeah, definitely. So I would say, and for those who are watching the video in this book right here, work the system. We have the summary of [email protected]. So that's a free download. Of course, we have a systems assessment. And ultimately, what I love doing is working with entrepreneurs and real estate investors, people in the real estate game, as a coach, business coach, business consultant, and helping them grow their enterprises. So love to connect with folks [email protected].

Mike Swenson
Awesome. Thank you so much for coming on and sharing your journey and how it's kind of helped you as an individual build your own business. But obviously, you're making a lot of strides with entrepreneurs and folks in the real estate state space and other industries, too. So best of luck to you as you continue to grow in the future.

Josh Fonger
Thanks, Mike.



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