Can you run a successful martial arts school without being the “Grand Guru?” Graham McDonnell and Phil Britten from the WA Institute of Martial Arts reveal how ditching their ego brought them success.

IN THIS EPISODE YOU WILL LEARN: 

• Why being the grand guru that “knows it all” could be your downfall
• What you can learn from modeling other successful businesses not related to martial arts
• Why the only way to grow is to stop doing everything yourself
• Have all your pictures displayed on the walls and opening up a new location? They must go!
• The system test you must do before opening up a second school
• What lead to almost $750,000 in 12 months with a brand new school
• and more

*Need help growing your martial arts school? Learn More Here.

TRANSCRIPTION:

GEORGE: It is George Fourie from martialartsmedia.com and welcome to the Martial Arts Media Business podcast, episode number 2. This episode is part 2 of the interview with Graham McDonnell and Phil Britten from the WA institute of martial arts, also The Institute of Martial Arts and a whole string of other businesses, that's probably not applicable to this podcast. And of course, this podcast is based on the success story of their martial arts school, the WA institute of martial arts.

So, this episode we just going to dig deeper – I think this is where the real meat of the interview kicks in. This is going to go deep into just different types of systems, different approaches of how you can approach your school, modeling other business models, ditching your ego, doing things a little differently, maybe not making yourself as the grand hero of your school, making the popularity of your school dependent on your systems and the actual training module, instead of you being the centre piece that holds it all together. And this is what's gonna allow you to really step away from your business and make it run like a well oiled machine as such.

If you haven't listened to part one of this interview yet, head over to martialartsmedia.com/1 – so that's the number 1, and the interview is there. You can also download the PDF transcription, or just read it on the actual page. And that'll get you up to date, before jumping into this interview. For this interview and for all others, you can go to the episode number, so martialartsmedia.com forward slash the episode number, this one will be number 2, and then we'll have all transcripts available also for you to download as a PDF.

So once again, introducing Graham McDonnell, and Phil Britten from the WA institute of martial arts.

GEORGE: OK, so – strong foundation, so you guys come in, you get a strong foundation, you put your identity and you pretty much just… What I hear is almost like the Apple of martial arts, and the whole unboxing experience, because it's an experience. Your goal is that, from when a person walks into the door, to when they leave, that there's a wow experience, it's a happening, it's not just about “I'm here to train”, which I think maybe that's a key thing that a lot of people are missing. it's the whole experience. it's walking through the door, parents that are assisting the kids, bringing them in. So it's the whole system, not just the actual class that's happening. So that's obviously a key part of your growth, but what else did you do, beyond that? So you got the foundation, you put your identity in, you've really optimized the experience for all your members – what did you do beyond that to double your membership base?

PHIL: Once again, we looked at all the stock standard type marketing, things that all the martial arts schools do, and we knew what worked and what didn't and one of the biggest things that any martial arts school owner, and if there's anyone out there who has any conflicting statistics, but I dare say they don't, one of the biggest ways that people get students in is through referral. And that's always, ever since the day that we started together till today, is always the biggest way. And that's why we said, what was the whole, the main thing, was about delivering amazing classes, wow experiences. But we needed to do this, not by modeling other martial schools, but that we looked outside our niche.

And we did look at Apple and we did look at McDonald's, how does McDonald's run staff and systems, and one adult has to be there to run the whole thing, Starbucks in America – we just looked way outside into what other businesses did and were doing to be successful, and then see how we can introduce that into our business. And that's really how we grew exponentially, with referral based type stuff. And there's an immense amount of things you can do, I mean this podcast's probably not gonna be long enough to list it all. Not neglecting the external stuff that you need to do, because you've got to open the funnel up. All the things that you need to do externally in your business, to be able to show the awareness to the wider community of your niche, your businesses, and why you do and what you do.

GRAHAM: George, there's something else that Phil sort of touched on, something we did early on – we got rid of our ego. We didn't know everything, we didn't claim we know everything and we didn't care that we didn't know everything. We'd actually probably been in a benefit that we'd started this business and realized, “Oops, we need to learn about business.” And then started to model off of different business model types and started just educating ourselves and really trying to grow and pick up on information.

So, I certainly know there's a lot of people I've dealt with, all across the world, that sometimes get stuck on the need to present an image, they need to be the grand guru of absolutely everything – look, people don't really give a rats. They like you to be real, and sometimes in business, it's all about going, “Ok, cool, that didn't work too well, we need to explore something different,” and knowing when you've made a mistake or failure or something. But it's not a failure, it's just a learning point, and cool, the next time around, I'll redo it. And I think what we did is, we tried everything. We tried it. you know, we didn't just limit ourselves to just doing the advert in the paper, or back in the day the yellow pages, which was around back then. But it was just like cool, we're gonna give it a go, why not? Why not? People go, you can't do that, it's not normal. Well, why the hell not, why can't we do that? You know, bugger that, we're gonna do it, so sit back and watch us. And we did. We've had a lot of people from the sidelines, business owners and others, sort of martial artists sort of criticize, “Ooh, you guys are selling out the system,” but really our drive was to empower our students, make them better, reach a larger audience and really transform them through our customer service and our community. One thing we knew is we had a really great environment, that when they walk in, they would be blown away. But how then do we reach a bigger audience? And we just didn't stick to doing the normal stuff, we broke the mould.

PHIL: I think just quickly, like Graham said, it comes up quite regularly, when we're dealing with our coaching clients, we all grow up in this world of being martial artists and more often than not, we have degrees in martial arts, but we don't have degrees in business. You know, you're talking to two high school dropouts here. Graham can hardly spell his name, and I can't count.

So between us, we're OK, that's why we've always worked so hard. But at the end of the day, you need to understand what Graham's saying, you don't have to be the best at everything. You just have to go, “I am who I am, now who can I learn from to get to the next level?” And that's what it's at, you might not have the business degrees, but someone else does. So go search for that environment, go search for that model, that person, who's getting that success you want, whether it's marketing or attention or whatever, and see what they're doing and model their behaviors, model their strategies, their mindsets, their beliefs, and the rewards will be amazing.

GRAHAM: George, you're gonna have to cut us off at a certain point, cause as he talks, I think of something different! But you know, we've touched on it before, we've invested a lot back into our schools, and a big part of that was education. Education for ourselves. It wasn't necessarily for the benefit of us, it was to better reach our students and be able to have a better product and whatnot. So we spent hell of a lot of time and resources investing in learning. As Phil pointed out, we certainly didn't know a lot, so we would invest in coaches to keep us accountable, we would learn this, we would learn that, and surround ourselves with people who are experts in their field.

People come to us because we're experts in martial arts. They may be an expert in something else, but we certainly went right – who can we help with our marketing or branding or vision? What about our computer systems? So that was something that we were always willing to do, instead of paying ourselves an additional income, we go, “Bugger that, that money that we've got as a surplus now is back into investing.” And, you know, I believe that the best investment you can possibly make in this world is in yourself. And if you up-skill yourself and up-skill your knowledge, it'll pay dividends down the track.

GEORGE: That's a big obstacle just in any business, the one you just addressed, where there's this whole DIY, you've got to transition from doing everything yourself, and then putting the ego aside and realizing, “OK, I obviously can't do all this, I've got to get some help with this.” And you mentioned a lot of people say that you're selling out the system and so forth- why do you think people are saying that? I mean, you do coaching for martial arts schools as well. I guess that's gotta be one of the biggest hurdles, people have got to come over, mentally and emotionally.

GRAHAM: Like I said, fear. Fear is one of those things, and you know, that's how it used to be done. Anything that's, something comes in new, is always ridiculed, it's always like, witchcraft and this and that. Look, we just didn't care, we just didn't care that they thought that was a sellout. We still have that, we still have people saying, throw the phrase around, McDojos, and so on. And I'm like, “Guys, we're a professional organization, and we can provide a professional service, therefore, we have better students- why wouldn't you want to be better?” You don't have to run yourself out of a dingy shed in a school hall and think you're a die hard martial artist.

If anything, you're doing them a disservice, by not providing the best quality possible. So we just went, “Bugger, we're gonna break the mold and test it out.” But a lot of it is ego and fear. Ego, to sort of prove to themselves that they don't know everything. And I know that, from a martial arts perspective myself – always, always enjoy going into a new class and putting on a white belt and just being that beginner. And have no issues with somebody going, “But you've done this forever and you're a white belt.” Yeah. Man, we're always learning. There's a lot of people out there that don't do that, they've stopped learning and they have a fear of being able to expose themselves and going, well I actually  don't know everything. So, fear and ego is probably the big one, and also, not knowing where to start. Who to ask, who to get the help from and, you know, that's just to cover things I've certainly noticed over the few years now that we've been consulting and coaching and helping out.

GEORGE: All good. Ok, so let's jump up a notch. Right. So, we've addressed all these obstacles and hurdles, you know, you've grown the school, the… Where we're at now, Greenwood. And so, you reached a point where, before you got the second one, before you opened the second school, how many students were you at, can you recall? Was it about 800?

GRAHAM: No, I think it was probably about the 700 mark, a 700 mark there. We thought… Honestly it was more a system check, a system test. If we do this, and we can grow the school to 700, and we were operating well, let's test our systems, let's test the model. Again, Phil mentioned that, we look at different companies, and go, right, how did they scale their business, how do they replicate this so that it can work on the other side of the world, work in a different area completely. So we thought, right, let's really start from the top down and make sure that we check every system, that if someone wants to walk into a brand new space, they could operate a WAIMA school, by just following the recipe. And that was something that we thought, right, let's make sure we've got everything locked down first and foremost. And let's give it a shot.

PHIL: I also think we got to a certain point of success in our business, right? The two of us did a great job, we had cars for the business, we had staff. And it was sort of like, well, what next? You know, we can just keep doing what we're doing and be comfortable, or we can try and push the boundaries. And I think, at a conversation that Graham and I did have at some point in that journey was something like, almost a challenge to ourselves – did we get to this point because we took over an existing business? And I was like, hmmm. let's challenge ourselves. Are we as good as we think we are, or, are our systems as good?

Have we got to this point because of us or was it because of the the kickstart we got? And it was a challenge for us, not that it's to prove anyone wrong, but it was a little bit, it was to show all the nay sayers, to guys that have been in the business for 25-30 years and still only have a 120 – 200 students, who were putting their nose up at us, and going, “They just took over a school,” and all that stuff. So we were like, nah, we're at a point, let's test our systems, let's test our knowledge, let's test our ability, let's test everything that we've got done to get to this point and then start up a brand new school. I started up a fresh school, my challenge was a hundred students in a year, we got that, and that's pretty darn good. So we challenged ourselves to double that for our new school and current one and I think we did 250 members…

GRAHAM: It was close to 300 in 12 months, and from an income value, I don't know, this is just for the guys out there, it was close to $750,000 we made in the first year.

GEORGE: Turnover.

GRAHAM: Turnover. So, the idea behind it was, we didn't just get the students in by having $10 a month fees – it was that we were charging a premium, top dollar, so quite expensive in the stock standard view of martial arts pricing. We think it's actually quite cheap, but others look at that and think otherwise. But for 300 members in 12 months, and an income at that, it really did validate, like OK, we've got something, and we certainly have, not sacrificed on being about the factory, not sacrificed on making sure it's all about the money, because money was irrelevant. It just happened to be that we focused on the client and really making sure that we surpassed their needs.

Put them first and the rest will follow. And that was a huge thing. But it was really nice to know that we were able to create this, we had a manager run a school from day one. Myself and Phil, we're guests at the school, we would walk in, it wasn't something that we had to drive ourselves and it was nice to look back after 12 months, and think, “Wow, the systems are working, the staffing is working.” You know, we definitely pressure test our systems on a regular basis to make sure that they're up to standards, because if you don't maintain things and you think they're OK, three years ago, they might have been OK, but now things may have changed. So, it's all about making sure you maintain those systems and the way you approach things.

GEORGE: What are those key systems? You keep on referring to the systems you've implemented. Can you give me a little bit more information?

PHIL: You've got hours or what?

GEORGE: I guess just briefly. Like, let's say I'm a martial arts school owner and I'm toying with the idea of how do I do what you guys did, how do I open that second job?

PHIL: I'll raise a red flag first, for any of the guys out there who are thinking of going from one school to two schools. it's tough, it's not easy, but most people fail, because as the school owner of one school wants to open up another one, they open it up and then they go back in the business and they work really really hard, it's like they're back to square one again. And they've got to build it up and it's all on their own back. And what we're getting at is, we didn't start out second school, until we had the right instructor to run it without us. So we didn't have to jump back in and be like, you know, trillion of hours a week, to get that business to operate. And we also didn't start our second school, until we worked on all the systems, as Graham was saying.

Graham's written down here a couple of things, so the systemization of your marketing, the systemization of your enrollment, from enquiry to the join up. And all the statistics that go in there, so the stats. You've got your curriculum, your lesson plans, so that theoretically, Joe off the street can come in and as long as he knows what a left hand a a right hand is, it should be described well enough so that anyone can come in and pick up where you left off. And your staff training as well.

And within those sort of things that we're talking about, were systems, systems within systems within system. And when it comes to stats in particular, we may have thousands of types of ways of reading the statistics. But actual fact – your school should probably have about a magic five. I mean, take for example flying an airplane. If anyone's seen the cockpit of a big plane, there are a lot of dolls, lot of switches. But I dare say there's probably five that are really really really important. The fuel, the altitude – I don't know, I'm not a pilot, but you get what I'm saying. And if you're gonna start a business, you wanna make sure that your magic five – we had the five, magic five that we work on, that if those statistics, if you're reading them right, if they're scaling well, if you're improving these five things, your business will consistently grow.

But, to go from one school to a second school, I would say – people might argue this, but I would say, you want to already have your instructor team ready to start that straight away. You wanna have some capital ready to go, to be able to sustain a year's’ worth of the wages and the marketing that needs to happen there. So do you need to get a loan out, do you need to remortgage your house, like you did for your first business? All those sort of things, do you have cash in the bank, I don't know. And you have to have your systems down, your one school has to be running so systematically without you, that you can then run another school without you as well.

GEORGE: So your first test is really your own school, and seeing are you able to be gone on a holiday and come back and everything still functions.

GRAHAM: Couldn't agree more George. And I know that if someone was to walk in here, or even have a helicopter view of the WAIMA organization, they would just think, “Oh my goodness, what a complex machine.” But realistically, it all started from simple systems, and then we just built up on that and built up on that and built up on that. And again, we really tried to make sure we take the guesswork out of it. We've had plenty of people in the past ask how did we get to this point. What we wanted to do was, we wanted to really think about, we need to take what's in our head and get it out and put it into a place that's digestible for our team. And that is something that's important, that it's not just from the mind of us and something that's very easy to follow.

Yes, we can review and refine as you go forward, but if your team don't know where we're heading and it's not easy to follow, it's gonna make some real challenges for you. So that's what I said,  simplistic systems can build on to being complex down the track.

PHIL: I'll just say this because George, you just brought up an actual reality fact. One of the moments we knew we had some good systems was,  Graham and I went to a trip to America for a month. And we didn't check in, we didn't know what was going on, and we came back and our school grew. And for us, that was like the tip of the hat, high five, we can leave our business for a month. And in that trip we went to America, and we saw other martial arts schools, we educated ourselves and brought some stuff back . But if our schools could grow within a month without us, we feel that our systems and procedures were fairly well nailed down, that our staff could run our ship without us.

GEORGE: Did you ever feel the need you have to check in?

PHIL: Oh look, when I say that we didn't check in, we have a system called end of day reports. So, at the end of each day, all our managers will report to us on their school, all the managers employees will report to them. So we just see the manager's’ reports. So yeah, at the end of the day, they will send their reports. So they'll all align. There were some early mornings, with the time difference in America, where we'd just flick to the end of the reports to make sure everything's alright, and got thumbs up, or hey, don't forget this, type of thing. But, essentially, we didn't have much input in four weeks, and that was really a lesson or a point in time where we went – we're ready.

GRAHAM: But George, there was a question I asked one of our, well, a couple of our sort of key managers, who run the sort of 800+ school, and ask them, you know, how did we get to this point? How do you now run a multi million dollar school? And they just go, what did we do for you that got you here? What sort of, what did we do, because sometimes we question, sometimes we do things automatically that you look back on later, how did we get to this point? And we asked them. And they said, “The fact that you trusted that we could do it. You believed that we could do it. And by the fact that you let us run your company with the belief that we can do it, and if we failed or made a mistake, it was OK.

Because it was a part of the learning lesson.” It was really powerful for them to go, “Wow, they trust in our judgment to make the right decision.” We didn't micromanage them, and therefore, as we've grown in schools, we did similar to what a parent would do when you first teach your kid to ride a bike. You let them fall a little bit, you dust them off, you pick them back up and push them on the bike again. And before you know it, they're riding by themselves, doing wheelies and having a great time. Same thing with this. You know, we're not reckless in pushing a manager forward and pushing them up to the play. We're there to support them,  but we also want them to experience both the highs, the lows, the scuffs, the injuries that go with it, and chat about how they handled it, rather than trying to run in to save the day. That was a really interesting point that they brought up, which is cool.

GEORGE: All right, cool. So trust – and I just wanna emphasize that, trust and allowing mistakes, not being with the hammer on the head every time that something goes wrong. The trust too.

GRAHAM: Yeah, yeah. Phil's got a great approach, and we do this very much as well too – whenever we deal with our team and they've got certain results, we ask the question why? Why did this happen, you know? And for them to explain their decision making process. And well offer some advice towards the end  – “Look, if it was me in that situation, I probably would have done a, b, c.” Great that you guys gave it a crack, well done, you've learned from that. If it arises again, now you've got the education sort of process, so they may make a slightly different decision, rather than jumping in and – don't get me wrong, we're not gonna let them do things that are critical, that you go bankrupt, but enough that they can learn from experience.

And really, if you think about it as a human being, what makes you a person is the experiences that you have, both the good and the bad. So if someone's there only to shield you and only give you the good, well, what happens when you get the bad happen? And I guarantee, there's gonna be ups and downs in every part of life. So as a key business owner, and a manager, someone running a school, you gotta allow them to deal with the challenges, you gotta allow them to deal with the headaches and see how they handle that, but know that they're not hung out to dry, they're not there by themselves. So we're there in the background to guide, if it's required.

GEORGE: Ok, great. So for staff – behind your instructors, who's the first person you employed behind actual, full time instructors?

GRAHAM: Oh, OK. Thinking back now, we did definitely have a… Their position has changed, but someone who was definitely more in an administration role behind the scenes. Our instructors are extremely capable in their strengths, and that is teaching awesome classes. But when it comes to processing of agreements, or dealing with creditors or stock, dealing with billing companies and all the rest, we had somebody that was really quite skilled in that area. So those were a 9-5 jobs, whereas our martial arts instructors are almost like a 12 pm start, till 9 o'clock at night sort of start.

You've got the engine room working the numbers, and the mechanic in there just dealing with that, and then you've got the guys who are at the front, having a good time, just pumping those great classes, which is really what we do. I dare say, there was probably more that full time admin person, was probably one of the first ones. It's obviously built from that, but they did certainly handle a little bit more in that role.

GEORGE: Ok. So, now I don't wanna give away all your secrets, but you guys are basically grooming instructors from the get-go, because you have a fantastic leadership program. And I know, my son just turned ten, and it's something he's been talking about for the past two years in his martial arts journey, that… Because ten years old, that's sort of the benchmark where he can enter the leadership program. So can you elaborate a little bit more on your leadership programs and how's it sort of ingrained in the system that the kids are so excited to step up their journey of becoming instructors?

PHIL: I'll let Graham talk more about that, because he's in there, doing that more. But what I will say before we get to that point is, that there was a key point in the growth of our business, where we realized that if we wanted to grow, we had to step aside. Because, even though there's two of us, there's only a certain amount of classes, a certain amount of hours in the day. And what most martial arts business owners fall into the trap is, that they become the only person that can run their classes and their school. It becomes personality driven, so people come there just for them, and if someone else taught that class, they'd probably leave. So when we first took over, we branded our school, it was the Phil and Graham show. Our faces were on the walls, you know, it was all, Phil-Graham, Phil-Graham, Phil-Graham. Which was great, but for long term growth and for us to get to the position where we are today, that had to change. So the photos went down. It wasn't then talking about Phil and Graham, it was us empowering our instructors more. It was putting them on the pedestal, and saying, “We're just a step behind them, we're pushing them going, these guys are the face of our business,” to some degree.

People will still come for our culture and our ethos and all that sort of stuff. We will still push that. But we needed to take a step back. We needed to remove ourselves from classes, little bit by little bit and put our guys out. And when we're walking through the school, talking to someone, we say, “Look at Andrew, look at Bree, look at our instructor there, haven't they grown so much, aren't they amazing? How well they're dealing with your child, how's your training grown since they've been in your class.” And it gets the client's thinking, “Yeah, they're amazing, they're amazing.” And eventually, they sort of forget about us a bit. And yes, they see us as the owners, and run the business and sort of steer the ship.

But it's that whole stepping out. But in saying that, when we did that early on and we focused on who can we have to step in, we fell into another trap that a lot of martial arts school owners have, and that's – we need instructors, let's look at the black belts. And we all know, if you haven't identified your instructors by black belt, they're probably not the right personality. And I'll let Graham talk about what we hire on, versus skill level.

GEORGE: Ok, I'm going to pause that right there. Next week, we'll continue the conversation with Phil and where Graham left off, talking about what's the one key thing that new instructors must have before they hire them. And the answer is probably gonna surprise you. We're also gonna talk about what it means to really  make a difference in your community, cost versus investment – are you charging too little? This is a topic that comes up a lot, about prices and are you charging too much, too little and are you just entering a price war, where students are shopping for price. Well, here's a great little exercise you can do with your students to justify that cost – investment rather, in their martial arts education.

So that's it for this episode. You can head over to martialartsmedia.com/2 – so that's the number 2, martialartsmedia.com/2. And we have all the transcriptions thereof the show, so if you wanna download them. And if you can, I'd very much appreciate it if you could head over to iTunes, there's a link on this episode if you go to martialartsmedia.com/2. There's a link to iTunes. If you could head over and leave us a great review, a 5 star review would be much appreciated. It helps us get our show up in the ratings and get the message out there to other martial arts school owners. So that's it for now, thanks again, I'll talk to you next week – cheers!

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