THE THOUGHTFUL ENTREPRENEUR PODCAST

1641 – Two Things Needed to Successfully Implement Initiatives with Vici Partners’ Alec Hudnut

In this episode of the Thoughtful Entrepreneur, your host Josh Elledge speaks with the Managing Partner of Vici Partners, Alec Hudnut.

Alec stressed that the most crucial aspect of any company is its decision-making process, as this determines its long-term success. Vici Partners helps executives understand the value of front-line and mid-level management by teaching them how to present ideas in a way that facilitates decision-making.

Vici Partners acts as a facilitator, sourcing ideas from within the company and helping clients present these ideas to executives. Their goal is to implement ideas that have been circulating within the company but have not been executed due to various reasons.

Unlike traditional consulting firms that focus on providing recommendations, Vici Partners believes in the power of buy-in. They simplify consulting into a formula: the quality of the initiative multiplied by buy-in equals the value of the initiative. In other words, the success of any industry depends not only on the quality of the idea but also on the level of buy-in from the organization.

 

Key Points from the Episode:

  • Explanation of Vici Partners as a management consulting firm
  • Vici Partners' unique philosophy towards consulting
  • Importance of buy-in and collaboration in successful implementation of initiatives
  • Vici Partners' role as a facilitator in sourcing and presenting ideas
  • Comparison of Vici Partners' approach to family therapy
  • Teaching executives how to make decisions based on ideas from front line and mid-level management

 

About Alec Hudnut:

Alec Hudnut is the Managing Partner at Vici Partners, a distinguished management consulting firm specializing in driving business growth and enhancing execution. With a team of experienced professionals, Vici Partners has achieved remarkable results for numerous clients from various industries and regions, with an impressive average earnings increase of 50% within 24 months.

Alec possesses over 25 years of expertise in executive-level management and strategic consulting. He began his career as an investment banker at Goldman Sachs, later transitioning to McKinsey & Co., where he advised public companies on effective board governance practices. Subsequently, Alec held CEO roles in diverse businesses, including University Access, Evolution Robotics, and EvoRetail. Additionally, he served as the General Manager of Revenue at Green Dot Bank, overseeing a substantial $550 million prepaid card business.

A graduate of Harvard Business School, Alec Hudnut's extensive experience and leadership have been instrumental in guiding companies toward substantial growth and success.

 

About Vici Partners:

Vici Partners is a team of seasoned professionals dedicated to helping clients achieve significant improvements in execution and earnings growth. Through their proven process, they focus on reducing costs and increasing revenues, often resulting in substantial operating margin increases ranging from 300 to 1000+ basis points.

The firm's expertise spans a wide array of industries, geographies, and market capitalization, enabling them to assist struggling clients in transforming their companies while aiding high-performing clients in directing resources toward profitable growth and enhanced market leadership.

What sets Vici Partners apart from other consulting firms is their absence of junior consultants and their direct alignment of goals and rewards with those of their clients. They prioritize a hands-on approach, encouraging clients to learn and adapt their strategies as integral parts of their ongoing operations. Vici Partners seeks to impart their knowledge fully to clients rather than push for additional engagements.

The professionals at Vici Partners boast diverse backgrounds encompassing financial services, technology, healthcare, education, government, and management consulting. Their common goal is to witness their clients achieve rapid and significant improvements in performance and morale, fostering a culture of responsible execution and continuous improvement for the long term.

 

Tweetable Moments:

09:37 – “The net result of our projects is the front line feels it has more voice and that the company is more profitable because of that.”

 

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Links Mentioned in this Episode:

Want to learn more? Check out Vici Partners website at

https://www.vicipartners.com/

Check out Vici Partners on LinkedIn at

https://www.linkedin.com/company/vici-capital-partner-llc/

Check out Vici Partners on Twitter at

https://twitter.com/PartnersVici/media

Check out Alec Hudnut on LinkedIn at

https://www.linkedin.com/in/alec-hudnut-8562071/

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Transcript

Josh (00:00:05) - Hey there, thoughtful listener. Would you like consistent and predictable sales activity with no spam and no ads? I'll teach you step by step how to do this, particularly if you're an agency owner, consultant, coach or B2B service provider. What I teach has worked for me for more than 15 years and has helped me create more than $10 million in revenue. Just head to up my influence and watch my free class on how to create endless high ticket sales appointments. You can even chat with me live and I'll see and reply to your messages. Also, don't forget the thoughtful entrepreneur is always looking for guests. Go to up my influence com and click on podcast. We'd love to have you. With us right now, Alec. Alec, you are the managing partner at Vici Partners. That is on the Web, at Vici Partners. Vici Partners. Alec, thank you so much for joining us.

Alec (00:01:12) - Josh Thanks for having me on. Appreciate it.

Josh (00:01:15) - Yeah. And in a nutshell, what does partners do?

Alec (00:01:19) - Vichy is a management consulting firm, and we help companies improve their operating income.

Alec (00:01:26) - And we work from companies in the 100 $200 million revenue range all the way up to very, very large companies. And typically our efforts result in a 25% improvement to operating income within a 2 to 3 year period.

Josh (00:01:43) - Well, that sounds like a good value proposition.

Alec (00:01:47) - Yes, we think so.

Josh (00:01:48) - And I understand that. So in terms of management consultant, your processes are a little unique. You might kind of explaining what that ends up looking like.

Alec (00:01:59) - Absolutely. So we have a different philosophy towards consulting than most of the big management consulting firms. We believe that to successfully implement initiatives, you need two things. You need the quality of the idea and buy in for the idea. And only when you have both an equal weight, they're equally important if you actually get the value. So we oversimplify consulting into a formula Q times B equals V, The quality of the initiative times the buy in for that issue. Initiative equals the value that you're going to get for that initiative when you try and implement it.

Alec (00:02:43) - And because of that, we spend a lot of time on the be the buy in part of consulting. And so our consulting is very different than typical management consulting firms. We don't make many recommendations. We don't make presentations. We do not tell our client what to do. Our philosophy is that the answer already lies inside of the company. And that if you really want to get buy in for something, the best way to get buying for something is to have somebody from the company themselves present to the CFO or present to the EVP. And so our role at Vici Partners is really more as a facilitator. So we'll go into a company and generate a few thousand ideas with frontline workers, with suppliers, with customers, with our own partners who've worked in a lot of different industries, who might see something that the client's not doing, say, in the call center that we've seen work, other places will generate all these ideas and then we'll bake them down to a much smaller group, say 10 to 20%, where there's a good business case, there's low risk and there's buy in.

Alec (00:03:53) - And then the client themselves is presenting the idea to the executives. And that way you get buy in, right? If you're a guy in the call center and you came up with the idea and you worked on and you built the business case and you've got your VP to sign off on it, and then you and the VP went and got the CFO to agree to it. Yes. What, you own that thing? It feels like your idea. It is your idea. And we vishy our value added is okay, you can't go after 3000 ideas. What are the 100 you can actually go implement? And let's make sure the business cases, implementation plans, the metrics, the milestones are very tight and that there's buy in from all the people in the organization who need to say yes or who could say no to the idea. So we spend a lot of time on the buy in, and because of that, we source most of the ideas from inside of the company. Because if it's coming from your own team, you're much more likely to want to implement it from an outsider.

Josh (00:04:53) - You know, I love this. It's much like so my wife is a family therapist and, you know, in her work with individuals, you know, a good therapist is not just going to run around and spout off all their opinions and advice on what you should do. You know, a good therapist is going to ask really great questions that are going to evoke, you know, kind of this natural finding of the truth kind of thing. And it sounds very similar to your approach.

Alec (00:05:23) - Definitely we we believe that co-developing the solution is better than imposing the solution. Most consulting firms, they just want. They just want to be smart, right? They want to say the right answer. Well, in our worldview, the answer is usually the easy part. The business case is usually the easy part. The you know, but but getting buy in for it. Yeah. Especially since the organization has been doing it that way before. There must be a reason why. Right. How do you break down those barriers? Are they politics? Are they bandwidth? Are they lack of capital? Are they, you know, lack of understanding what the positive customer impact would be like? What are all the barriers that have kept the organization from doing something that seems like a really good idea? So we spent a lot of time on that.

Josh (00:06:17) - And I suspect that, you know, in your legacy or just kind of being in the consulting world, I'm sure you've heard of stories maybe working with clients and kind of having conversations about how they've engaged with consultants previously. I'm sure there are plenty of stories of, well, listen, you know, we, you know, invest in $150,000. You know, all this work we did all this stuff, had great findings. And guess what? We did nothing with it. I'm sure that happens. Yes, of course.

Alec (00:06:47) - I used to be one of those guys 25 years ago when I worked at McKinsey. Right. You make a great blue book. It's super smart. It has all the answers into it. You know, you hand it to the to the VP or the CFO and they're like, Well, that's great. You know the answer, but how am I actually going to get it done? Right? So a lot of, you know, we believe that the value in consulting is to actually get a change in behavior in the organization that leads to an improvement in operating income because people are now implementing, you know, dozens of things that have been rolling around in the company for a long time.

Alec (00:07:27) - Most of our clients are like, but most of these are our ideas that we've been thinking about for years and we say, You are absolutely right. That's the point. Because if it's your idea and it hasn't gotten done, we're here to help you get it done, help you build a better business case, help you understand why buy in hasn't been created, break down those barriers so that you can then implement it with greater chance of success.

Josh (00:07:54) - You know, another podcast, I don't know if you've connected with Doug Knoll, who hosts a podcast called Listening with Leaders. By the way, you would make a great guest for him. I'll make that. I'll make that connection afterwards.

Alec (00:08:05) - Happy to.

Josh (00:08:05) - Meet him. Yeah. Yeah. He's so he's he's one of the podcasts that that we've launched and yeah and that's one of the things that that he really focuses on is is helping you know helping top level leadership develop much better listening skills and empathy. And, you know, something that you're pointing out.

Josh (00:08:24) - I think we all are aware of this and maybe we don't have and I'd like to maybe just kind of bring this up a little bit more broadly here to talk about this culture of listening, because I suspect that there probably are within our organization a lot of really good ideas, particularly those folks that are right there in the trenches. They are on the front lines. They are seeing things, they're seeing trends, they're getting customer feedback. And sometimes it can be really challenging to encourage encourage that dialogue because it ends up could be potentially a lot of communication or, you know, again, we kind of have to sift through everything. But I think a lot of times oftentimes it's it's, you know, those folks that might be on those front lines don't feel that that input would be valued. Any ideas on developing better cultures of listening because it seems like that's what you're you're advocating for.

Alec (00:09:25) - Yeah. And that's what we do on our projects. The net result of our projects is the front line feels it has more voice and that and the company is more profitable because of that.

Alec (00:09:37) - So it's it's so I've been a CEO of three tech companies so I understand the executives perspective. So the executives perspective is. When a frontline employee comes to me or any employee comes to me, it's usually a complaint. And it's unclear what I'm supposed to do with it. And it's unclear why it improves the profitability of the company or improves our relationships with customers. So as a CEO, I only have the bandwidth to listen to things that basically say, here's the situation we face. Here's why. Here's why it's a problem. Here's the proposed resolution. I need a little bit of investment. I need 10,000 in investment and I'm willing to sign up for $100,000 of cost reduction because of it. And I've gotten the 3 or 4 people in the organization who would need to say yes to this, to already say yes to it. Now, when a frontline employee comes to the CEO and starts talking like that. The CEO can sign off on 100 ideas in a day because they're not complaints. And so the executives stop listening to the employees and the front line, in large part because it's noise for them.

Alec (00:11:01) - How can I take action on that? Right. I mean, of course, if it's something extreme like the refineries about to blow up, Right. You know, something like that, you can move on quickly. But most things are you know, most things come as complaints without a solution. And on the other side, if you're a front line person in the call center. You don't know how to talk to the CFO, right? And the CFO wants to say, what's the business case? What's the risk? How does this impact my quarterly financials that are coming up? Did you get a bunch of people to review this and sign off on it? And who's going to implement it? And how am I going to know that it's successfully implemented? Right. And so we're in in building in our programs at Vici Partners and building these initiatives with frontline workers. We're teaching them how to build that case so that they can talk to the executives and the language that the executives understand. So I think the big problem with communications is that frontline workers and other other mid-level managers don't know how to talk to the executives in the language that they're comfortable listening to.

Alec (00:12:07) - And the executives have been so overwhelmed by complaints or, you know, things that they can't do anything with. That they're more comfortable with the big customers, the senior executive team, the board, because they all talk the same language and they don't just vomit out complaints. Right. So we are helping. The executives understand that there really is value in the front line and mid-level management. If there if if those ideas are presented in a different way and we're teaching the front line and mid-level managers how to talk to executives in a way that an executive can make a decision. Because the most important part of any company is not the strategy. It's not the product. It's not the culture. It's how a company makes decisions. You can determine the long term success of a company by how it makes decisions. So we're teaching the company how to make decisions in a different and new way. And it's not like a training program. It's we implemented these 100 initiatives. They were worth $50 Million. Guess what? This is a valuable new way of doing things, right? It's not some two day retreat where you're teaching everybody stuff.

Alec (00:13:26) - It's actually let's do it together and show how that new communication can unleash. Value in improved operating income and voice. Right. And it's beneficial to the employees. Now, the guy in the mailroom who came up with a $6 million idea at the big insurance company to cut Fedex costs. Next time he's in the elevator with his CFO, the CFO turns to him and said, I love that idea. You got any more? And the guy feels valued at work, right?

Josh (00:13:55) - You know what's unique, Alec? And I'm thinking about this as you've been talking about, you know, we think about where as a consultancy, right, You know, where your business comes from. But your approach is kind of interesting because it usually you have to have a champion on the inside. If someone's like, you know, we really need to bring partners in. But it almost feels like, you know, you've really opened up that potential champion. Like it could be typically a lower level manager is not going to recommend necessarily a consultancy to come in.

Josh (00:14:29) - And, you know, whereas I bet that there's someone listening to us right now that's somewhere in the chain of command and they might feel that they're kind of lower down the pole, but they're listening to what you're talking about. You know, like, you know what, There are a lot of good ideas. I've got a lot of good ideas. And, you know, we need to, you know, kind of work on. I'd love to I'd love to share that in a way that I feel like it would be valued. And so it seems like it kind of opens up, you know, who I was. Because my next question I was kind of thinking about this is, you know, like who should be reaching out, you know, what types of organizations, companies and specifically within within the organization who can be, you know, sharing this episode with someone else within their company so that they can have a here at this and then, you know, potentially find ways of engaging with Viki.

Alec (00:15:19) - So typically we engage with companies that have greater than $100 million in sales. And typically the CEO or the CFO is the decider. They're the ones that choose to buy their services from partners. However, a lot of times we get introduced to those CEOs and CFOs because the head of H.R. thinks it's a great idea to improve employee voice or, you know, a VP worked with us at another client and he saw how well it worked. And now he goes and talks to the VP of marketing, says, Hey, this really worked. We saved a bunch of costs. We invested half of it in better marketing. We have a much stronger brand and it allowed the company to, you know, have lower churn rates and sell more products. So we we do have advocates inside of companies that help us get to the decision makers. And then after the project, we have hundreds of advocates, right, because we have hundreds of ideas that have been approved. And it was it was that person's idea who came up with it.

Alec (00:16:21) - Right. And we're just helping them get it over the finish line.

Josh (00:16:25) - Yeah. Your website partners Vici. Partners. Com For someone that's been listening to our conversation, what would you recommend they do next? Maybe they're kind of listening to this as part of their research on VC. Where do they go from here?

Alec (00:16:41) - Well, they're welcome to email me directly, and my email is a Hudnut, a Hudnut at Vici Partners or on the website. There's a there's a more information button. You can you can email us there. But we're, you know, we're interested in companies that want to improve their earnings. And, you know, improving earnings wasn't a sexy word a couple years to a year ago in the tech industry. It was all about growth. And we think that at the end of the day, it's always about profitable growth, not just growth. If you have a high growth company and you're still losing money or your margins are really low, at some point your shareholders are going to want that to be different and we can help you get ahead of that difficult conversation.

Alec (00:17:34) - By getting yourselves profitable. And typically on most of our projects, a portion of that profit, if we find $100 million of savings at $1 billion company. The CEO and CFO is going to be reinvesting 25 to 50 million of that in growth initiatives.

Josh (00:17:49) - That's right.

Alec (00:17:50) - Products, new channels.

Josh (00:17:52) - New partners, opportunity marketing.

Alec (00:17:54) - So it it supports the growth and it supports the profitability of the business.

Josh (00:18:00) - Love it. Alec Hudnut, again, Managing Partner, Vgi Partners. Vici Partners. Alex, it's been great having you on the on the show. Thank you so much for joining us.

Alec (00:18:11) - Josh Thank you for having us on and enjoy the conversation.

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