Monty Moran [Part 2]: Spice Up Your Company Culture | E85
#85: Spice Up Your Company Culture with Monty Moran [Part 1]
Want to know how to build and maintain a strong culture?
This week, our guest is Monty Moran, former co-CEO of Chipotle Grill and a previous lawyer and managing partner of a law firm. Monty was integral to the massive popularity explosion of Chipotle across the United States in the late 2000’s. Currently, he is a chairman on many corporate boards, an advisor to many start-ups, and a new author. His new book, Love is Free. Guac is Extra. is released October 20.
In today’s episode, we have a lot to cover – so much so that we’ve made this a two-part episode! We will start off our conversation with Monty today by hearing his early career journey and how he ended up at Chipotle after being a lawyer for 10 years. We will then dig deeper into his best strategies for creating a great culture, nuances in communication, and hear his fascinating stories of interacting with people from all walks of life.
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Check out our website to meet the team, view show notes and transcripts: www.youngandprofiting.com
00:55 – Monty’s Career Path Thus Far
03:00 – How He Built Trusting Relationships With Employees
13:05 – Where Monty Got His Confidence
16:51 – The Best Strategy to Succeed
19:19 – Why Monty Went Undercover at Chipotle
28:30 – Monty’s Definition of Leadership
31:03 – Why Culture is So Critical
40:39 – Monty’s Learnings from Raw, Honest Conversations
45:26 – Importance of Curiosity and Vulnerability
51:40 – Body Language Tips
58:09 – Characteristics of Looking for Talent
1:06:52 – Advice for Promoting a Mission
1:18:00 – Quick Phrase Explanations
1:24:24 – Monty’s Secret to Profiting in Life
Monty’s Website: https://montyfmoran.com/
Monty’s Book, Love is Free. Guac is Extra: https://montyfmoran.com/pre-order-book/
Monty’s LinkedIn: https://www.linkedin.com/in/montyfmoran/
#85: Spice Up Your Company Culture with Monty Moran [Part 1]
[00:00:00] Hala Taha: [00:00:00] This episode of YAP is sponsored by Podcast Republic. Hey, Android users, this one's for you. Podcast Republic is a podcast app where you can discover and subscribe to 1 million shows and enjoy live radio streaming. They have over 85,000 authentic reviews and a 4.6 star app rating in the Google play store.
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We're chatting with Monty Moran, the former co CEO of Chipotle and former CEO of the law firm messenger. At Chipotle, Moran led a team of more than [00:02:00] 75,000 employees and helped to grow the company from eight locations to more than 2000. He was key to the massive explosion of Chipotle across the U S in the late two thousands.
Currently, Monty is a chairman on corporate boards and advisor to many startups and a new author. His first book Love is Free. Guac is Extra. comes out tomorrow, October 20th and today's episode, we have a ton to cover so much that I've made this a two-part series. In part one, we'll discuss Montey's early career journey and how we ended up being the co CEO of Chipotle after being a lawyer for 10 years with no food industry or real estate experience.
And then in part two, we'll go super deep into his expert leadership strategies, including his perspective on creating a great company culture. His top ways to connect with people and how you can design a mission that will motivate employees to do their best work. Hey Monty, welcome to Young And Profiting Podcast.
Monty Moran: [00:02:59] Hey, thanks so much. [00:03:00] Glad to be here.
Hala Taha: [00:03:00] We are very excited to talk with you. You've had a very fascinating career journey. You were formerly the co CEO of Chipotle during its massive growth period from 2008 to 2016. And it was under your watch that the organization expanded from eight restaurants to 2000 globally.
So you've got a really extraordinary career path. You started as a lawyer. Then you became, managing director, CEO of priority law firms or premier law firm, I should say. That's a very unique career path going from lawyer to managing a law firm to then becoming the CEO of Chipotle. So help us connect those dots there.
How did you end up becoming the co CEO of Chipotle, getting that role there? Coming from a lawyer background? It just seems like a very unique career path.
Monty Moran: [00:03:49] Yeah, I think it is a unique career path. Really. I was a lawyer in Los Angeles for a few years. And during that time, my friend Steve Ells had started, had founded Chipotle back in Denver [00:04:00] and he had opened the first store and he, and I just stayed in touch during that time.
And during weekends I'd come back and I'd eat the incredible food he was making there at that time. He was working personally at the restaurant. And the food was just unbelievable. It was like way too good for a burrito. And so was really proud of what he had done there. And after a few years practicing in LA, I I got married and wanted to come back to Colorado to raise my family in Colorado.
And so came back to Colorado and started got a job at a law firm in Denver. And I was, I think the eighth lawyer at that law firm. And it was an associate position. And then I started working as a lawyer. And during that time, I started developing clients at the law firm. I basically worked my way up and very quickly became a partner of that law firm after about a couple of years, and then became CEO of that law firm after a few years.
So as CEO of the law firm, I was really working. It was working hard on my own cases as a lawyer, but I was also working really hard to build a culture in the law firm because I was, there were so many clients coming my way and I got busier and busier, and I basically started to figure out I couldn't handle all the work.
[00:05:00] And so I had to hire more people. And when I hire more people my clients got mad, when I started giving the work to other people and they'd say, Hey, I want you to do my work. I want you to do what, why are you slacking off on my work? Where are you getting it to associates? Don't I matter to you anymore.
And that kind of thing. And what's really funny is that initially that felt really good to me, that they wanted me to do all their work. It was like, oh, cool. I'm glad you like me. And so my ego was warmed up. Those comments but at the end of the day, I was getting way too busy to do all their work and I really needed to get the help of associates to do the work.
And so what happened was something had to give, I would have to start saying no to new clients, which I didn't want to do. Cause I was building a really neat law practice or I would have to find a way to have my clients be happy with working with junior associates. And so basically the thing they had to give was my ego.
I had to be like, okay, I gotta be clear. If clients like and want other people to work on their cases and are happy to have me off their case. And that's really counterintuitive for a young lawyer who was working really hard to build a practice, right? Because the way you become a partner of a law firm, these days, [00:06:00] isn't 30 or 40 years ago, when you just hang in there at time, doesn't get you there.
Most of the time, you have to develop a book of business. You have to develop your own clients and bring that value to law firm. And that's what I had done. But in order to develop even more clients past the amount of work I was able to do 24 hours a day. I had to make sure the clients were happy to have other people do the work.
So in order to do that, I had to do a lot of things very differently. I had to empower the associates at the law firm to have a direct relationship with the client. Now, most of the time partners in law firms like myself would not do that because they'd be afraid if they allow the young associates to have a direct relationship with the client that then that young associate could take the client and leave and go form their own law firm.
If it was a big enough client or they could take a few clients and leave and start their own law firm. And that was very common that young lawyers. Of course, it makes sense. They'd get a higher percentage of the money from the work and they get paid all, they wouldn't have to accept a salary.
So the only way to get them not to leave is to create a culture at the law firm. That was so excellent, so good for them that they didn't want to leave. So I basically had to give them the power to have direct client relationships and have it be that they [00:07:00] wanted to stay because it was such a great culture for them.
So how do they do that? I trained them really. First of all, I picked great associates. I learned to interviewed carefully. Cause I hated firing people. And I had to do that sometimes when I had someone who wasn't very good and didn't want their success for themselves as bad as I wanted it for them.
So sometimes that happened night. And I had to fire people and it was awful and I hated it. So I started interviewing very carefully. And I didn't interview for experience. I started interviewing more and more for character, to get the kinds of people who I knew would want to do really well.
And who are ambitious and motivated and hospitable and charismatic. Yeah. And high energy happy and enthusiastic and those kinds of things. So anyway, I started hiring better and then once I heard the people, I would work very hard to train them to be excellent young lawyers young lawyers want to be trained.
They want to become excellent. And so since I was putting all my time into training them, they liked that they know we'd pay them a good salary, but I would give them incredible bonuses when they do great work. And so they knew that I would reward them. So they weren't afraid that they were going to go without reward if they did great work.
And then I gave him direct client contact, I would actually [00:08:00] introduce them to the client and say, Hey, this is the young associate will be taking care of. You probably won't need me. I'm around if you need me. I'm certainly there. If the associate has questions, just go ahead and develop a relationship there.
That happened. And these young associates who have developed relationships with loads and loads of clients, I would have less need to be involved directly matter which meant that I could develop more clients develop new areas of practice, say yes to more new cases and basically grow personally as a lawyer, as well into new areas of practice.
And the need to build. I built a great culture, not because I thought, gee, I'm going to build a great culture. I built a great culture because I needed to build a great culture in order to continue to be successful at growing my practice. It was that simple. It was out of absolute necessity and that necessity pushed me off my ego, decided where I had this great big bell ring in my mind. And this was one of the biggest bells that's ever rung in my life. And it was this way becoming the very best lawyer that I can be and doing more and more hard work and making it all about me being excellent was actually a less desirable thing than to actually bring in young people, excellent people with a lot of potential and make them [00:09:00] excellent.
So I finally saw that it was a more powerful thing for me to do in life to make others. Then just to keep making myself incrementally better or work incrementally harder. I got to a point where I couldn't work a lot harder. I was working all the time, so I had to find a way to make others better. And so that thing about making others better.
And then what I soon learned is that was really immensely satisfying, making others better, training them, teaching them, mentoring them, helping them emotionally, helping them as a person, just trying to make them the strongest version of themselves I could. And then of course the benefits was that strongest version of themselves, which was already a great person.
It became a wonderfully powerful asset to the law firm. During that time I was doing lease work for Chipotle. And started to do more and more stuff for Chipotle because it was a young company. And I did things very inexpensively. If I got into that story, it was actually absurdly inexpensively looking back because I wanted to take care of Chipotle.
It was a very young company. They only had eight stores when I started doing the lease work. And and Steve Ells was a friend of mine. And Steve started coming. He came over the law firm to talk with me and we were both very excited myself about the young law firm that I was [00:10:00] continuing to build.
And Steve about his young burrito chain that he was continuing to build. And we had a great time talking about, and we were really enthusiastic for ourselves, but also for one another's success, because we were doing something very different. He was building this company where you sell burritos. I was building a law firm, very different businesses, but yet any business
can and should benefit from an excellent culture. And what Steve, when Steve came over law firm, he started to say, man, what is it? How do you do this? The culture here is great. Like these people are working really hard, but they're stoked in there. And they're having, I don't know, Steve said the word stoked up, maybe my word.
But he was like, God, they're really enthusiastic. They're, they seem really smart. They're they come into my office and they meet Steve and oh, Hey Steve. And they were all excited. He's God, these are great people. How'd you do this. And, I, I don't know if I explained how I did it initially, as well as I did just to you.
I just said, I dunno, we're working hard here, and but he really kept no, really. How did you do it? And so I stopped and said let me tell you how I did it. And I explained it to Steve. And we started talking about culture and he's Hey, how about if you come to Chipotle and build this kind of.
That was like, oh gosh, that's really flattering. Thank you. But gosh, I love what I'm doing here, we continue to talk about this, but over the course of the next five years, he continued up the, [00:11:00] any, no, really no, really come to 12, like no, really comfortable. And eventually he he offered me sort of various officer positions and said, Hey, why don't you be the real estate director?
And I said that sounds like a lot of travel. And I just had young kids. And so I waited on that. And then he said, how about come be chief administrative officer? It was the next. And I said didn't know what that means, but administration doesn't sound very fun. And I'm like, what does that do?
And he's oh, I didn't know, but it's a cool, you'll get in, you'll do good with it. And I was like, okay I don't know anyway, over time. But eventually he said, Hey, how about you just come run the company because I've been doing this a long time. And I think you could build a great culture at Chipotle and it would really help us.
And I thought, God, it's flattering. It sounds wonderful. I love Chipotle. It sounded like a great opportunity, but I was really reticent to leave my law firm. But then Steve said something that, that actually was. Yeah. He said a lot of smart things, but this was probably the thing that most powerfully caused me to decide to give it a shot to wrench boat.
And that, as you said, Monty, do you think you're a great lawyer? He goes, but really what you are is a great. And if you come to , instead of the, at that point, maybe at our law firm, we had 30 or 40 employees at that point. Maybe more than that, maybe it was 50 by then. I don't know. But anyway, I don't remember [00:12:00] the total number employees, but basically fully, it was like, Hey, we're up to 8,000 or something, by the time we were this point and I'm like, wow.
And he said, yeah, you have an opportunity to come change. And the fact that many people's lives, why don't you try it? And eventually long story short, I said, it okay. And but during that time I had become general counsel during that 10 year period of time of starting at the law firm and going to Chipotle.
I had and I've been a lawyer before that in LA, but I'm talking about the one law firm in Denver where I was, so that 10 years during that 10 years, I had become general counsel of Chipola. I literally had a business card that said Chipotle and money ran general council, even though I wasn't really wasn't an employee each yet.
Yeah. So for many years I was general counsel of Chipotle and I spent, and the deal there was the then chairman of Chipotle told me he wanted me to spend, which is a guy named Jeff Kindler. He told me, Hey, you should spend, tried to spend 16 hours a week of your time at tripling. And so they gave me an office at Chipotle and a desk at 12, because you said, Hey, the more you're there, the more you'll be able to help the company with various problems that come up, people will feel quicker to come approach you and just drop things on your desk.
And so the agreement was when they may be general counsel, I'd have to have [00:13:00] an onsite presence of 16 hours a week. So I said, okay, cool. So I did that for for quite a long time. It was from that position that I made the jump to, to become president and COO, which after a couple of years became co CEO of Chipotle.
So that's how I came to be there. And but it was a slow we're transitioning than it sounds in the sense that before I went over to be at AAA, Steve had asked me to come to the door. And then I was doing the note, the minutes for the board meetings as the lawyer. And so then then he asked me to come to all the leadership meetings, which is where you have the top leaders of the company, usually something, maybe 16, 18 people.
And I would go to all those meetings. And then Steve noticed that at those meetings, I was very participative. I'm a guy with a lot of opinions and a big mouth and not afraid to speak. And so I did, and he really appreciated that he appreciated the fresh look at things and he, I think he very much continued to want me to be involved.
And so ultimately I I agree.
Hala Taha: [00:13:46] Wow, what a great story. And, I'm really happy that you unpack all that because I think it's really great context for our listeners. As we go on to talk about your leadership style, your new book, and some of this other stuff, there's a few themes in there that I want to dig into.
You started [00:14:00] off as a lawyer, you then started working at Chipotle. A lot of your responsibilities had to do with like real estate leasing and things that you didn't really know about. The food industry obviously was totally different than the law industries. So that was a whole different move, especially women, especially nowadays they have imposter syndrome, they're worried about taking on a role that they don't exactly have the credibility or, the resume on paper to back up. So how did you go for it in terms of, working at Chipotle, helping out your fully, even though you didn't have the relevant experience, how did you have the confidence to learn as you went along?
Monty Moran: [00:14:37] Wow. First of all, with regard to imposter syndrome, you said a lot of women have imposter syndrome. I didn't know that was a particularly woman thing, but I can tell you, I have imposter syndrome really badly, I always have so maybe that's part of my very, maybe it's my feminine side, which I think I have a large feminine side, but anyway I've always had that.
And my willingness to do more and more work for Chipotle arose a lot more from my needs to please and be useful than it did from any [00:15:00] particular confidence. That I'd be great. So in other words, when Steve asked me to do real estate leases, I said, oh cool. Yeah, I'd like to do that.
But then I ran to the library and spent literally weeks at the University of Colorado law library, reading every book on real estate leasing that I could find. And like taking notes. Really all my time and I didn't build any of that time to anybody. We couldn't build a Chipotle, it wouldn't be fair because I was trying to get smart.
And then I talked to my partner, Ron Reeves, who was a real estate lawyer. And I learned from him and actually I said, I talked to my partner. He wasn't even a partner yet. He was a partner I wasn't, but I talked to who, the man who became my partner, Ron Reeves, and learned about as much as I could about real estate law.
And I just became a sponge and tried to learn. And then the first few, I did these leases for a flat fee, which ended up being a $1,200 flat fee. And the funny thing there is, I think it took me a hundred hours. At least initially, because it was a lot, it wasn't just the least there was a lot more associated with it, like real site assessments and environmental impact statements and super fund information about sites of that pollution and this and that.
So there was a lot to it and that was going through all this stuff with the finances and trying to learn, and I didn't really care about my billings. I didn't care about whether I made the money. I just wanted to please to put light, please, [00:16:00] Steve help the company and and be be someone who they were called.
I want every job I've ever had. I wanted to prove to my boss or my client, that they made the best decision in the world to hire me. And I've been willing to break my back to prove that. Even when I started out at dairy queen, that wasn't even my first job, but it was my first W2 job where I had, withdraw withholding taxes and all that.
I was 15, 15 years old. I had to be 15 and get the job as soon as I turned around. I got the job at dairy queen and I felt so lucky to have that job, which I got paid. I think it was $2 and 45 cents an hour. And I felt so lucky to have that job. I couldn't believe someone was paying me. So I felt like I'm going to prove to them that they made a great decision to hire me.
And I worked there for years while I was in high school. And then my next job, I was a janitor and I wanted to prove just isn't a higher agenda, their effort. And so every job I've had a whole bunch of jobs that people would call quote, unquote, dead end jobs. There's no such thing as dead end that job.
In fact, I've learned so much from my dead-end jobs that that I call them in my book, my minimum wage MBA. It's like I learned a ton working at these places. And so to me, there was no job that wasn't good enough for me. It was almost like the opposite. I was so afraid. I wasn't going to be [00:17:00] good enough for any job, whether that be dairy queen, being a janitor, let alone being a lawyer, starting to do work for a young Chipotle Mexican grill.
Which, even though it was a very small company, I had all the confidence in the world. It would be successful to them. So delicious. And Steve was, such a visionary and was, he was held back to make it a really successful company. And I thought that he was going to do that anyway.
So it's not that I had such confidence it's that I was going to play. And I was going to work myself to death to do it. And so in doing that, I think I just kept surprising people. I kept surprising and maybe even myself, but I kept surprising people with doing a great job and getting involved in trying to help them and making sure that whatever I build them was like, they got way more value than I built them.
And I carried that through my entire life. I've always tried to be of more value to whoever hires me than they were. And that helps.
Hala Taha: [00:17:43] So you have a quote in your book. I think that summarizes it really well. You say to this day, when people ask me about the secret of my success and how I can get ahead in life, I tell them, don't worry about getting ahead.
Totally focused on what you're doing right now. Do it very well with all your passion and energy. People will [00:18:00] notice. And when they do they'll want more of your time. So it's not about you actually having the experiences, having the knowledge, the exact, experiences of the past to implement in the feature.
It's really about having the attitude, the right attitude and having good intentions to do well. And I follow the same strategy and I always excel when I do that. Just having good intentions.
Monty Moran: [00:18:21] Yeah. If your goal is, if your goal is to really help someone and really take care of them and make sure that their association with you is something that is great for them.
How can you fail if you think about it, right? If you don't provide that much valuable, then don't build them as much or work harder or, it's so yeah, this idea, and I think a lot of young people now, and I was just talking to my oldest son. Yeah. And he's at that point of having graduated from college, he did well in college and he's looking for a job and he's dad, it's really hard to find a job right now.
And there's tons of people like out of work and, and I don't even know how good I'll be at these jobs, which I do. What should I do? What should I do? And I was like, get a job. Like any job, I get a really bad one, get one where you sure that you can succeed. There'll be lucky to have you [00:19:00] and then work so hard at it that you blow them away like that.
You're like, holy crap. This kid's flipping burgers, but man, he makes great burgers and he makes a lot of burgers and he does it with love and care, and I said, and then what happens is what happens then is your confidence builds because you start being good at something. And if you're good at something, I don't care what it is.
If someone is good at some thing, they get confidence that they can be good at something. And they can go to that something else and then they get good at it. And then they get confidence. Oh, I'm, I've been good at two things. Now, maybe I can be good at a third and then they're good to the third. And then they're good at a fourth and they get it.
And eventually they get a string of being good at stuff. And when you're good at lots of things, you can be good at more things and you get confidence that, Hey, I am I'm useful. I can help people. I've got, and you start to actually accumulate estate. And then that skill will, then it just snowballs it just keeps getting more and more powerful.
Hala Taha: [00:19:44] Yeah. Take heed to what he's saying everyone. Monty is giving really great advice in terms of how to just succeed. It's not about, everything that, you know and what you have on paper. It's about your attitude and the effort that you give. So let's talk about your role as [00:20:00] CEO. I read in your book that when you first started, you immediately decided to go undercover.
So tell us about why you went undercover and some of the lessons that you learned there.
Monty Moran: [00:20:11] Listen, this was a company that by the time I joined officially as an employee, as a W2 employee, after having been general counsel for the better part of a decade, when I officially joined, there was like 8,000 employees and like 350 or 400 stores something, I forget the exact number, but it was a lot of restaurants.
And so I went in there and I thought what's, what can I really do? To help this company. You know what I mean? I can't go in and clean every store. There's hundreds of them. I can't go in and make sure the food's good. There's a hundred thousand customers, hundreds of thousands of customers every day.
What could I do? I thought the one thing I could do is really understand. How we're training our managers because if the general manager was excellent in any given store, that store would hire great people to produce great food served quickly have great customer service and do all the things that would make to successful.
So I said, you know what? I'm gonna. Is I'm going to go in and go through our manager training and see [00:21:00] how we train these people. Because I did already have a, an understanding that some managers were really good, but a lot of them weren't so great. And so how can I make them all great. So I thought the first thing I better do is find out we're training them.
So I asked Gretchen Selfridge who was a woman was at that time a regional director. So she had a whole bunch of stores reporting to, or maybe it's at that time, 60 or 80 stores. And I said, Hey, can you find a restaurant where you can put me in as an MIT trainee? Cause that's what we called managers, who we hired off the streets, usually with fast food experience and we put them in as
trainees. And then after a six week training program, they would become managers and go off to usually a new Chipotle era, which boy that needed a manager and become the general manager. And so I said, Hey, can you put me in as a as a fake MIT trainee? A real MIT trainee, but I want people to not know who I am.
I don't want them to know that I'm the new president and COO of the company, which was my title at that time. And she goes, yeah, I can do that. And so we found a store where no one knew who I was except the general manager. And she was. And her name was Kay and she's fabulous. Great trainer. Really neat.
She was, she [00:22:00] sat me down the first day. He goes, okay, I know you're president and stuff, so I'm just going to do this. I'm not going to tell anybody and I'm going to train you and I'm going to I'm really going to train you. Like I trained in the old person. I'm like yeah. That's what I want.
She's but I'm going to I'm going to be tough on you. I'm like good. Be tough on me. I don't want any positive. I don't want any, what do you call it? I don't want any leeway. It's I want you to beat me up and make me a good manager. Okay. And you know what she did. She didn't beat me up, but I didn't make her have to, I worked really hard, it's I was really motivated to get to be, yeah.
Manager at Chipotle. So I knew what I was doing. And so anyway, I went through that program and it was awesome, but what, but I learned some things that weren't really part of the training program. Okay. So one thing I learned was that the crew people who we had working there at this time, it was a largely Hispanic crew.
In fact, 86 or 87% of our workforce nationwide was Hispanic. Yeah. At that point. So it was a largely Hispanic workforce. Most of them didn't speak English. And I spoke this little tiny bit of like crummy Spanish, but I'd worked it through and we'd communicate. And so I would ask the crew people and keep in mind that's who was training me really Kay was responsible for training me, but she would set me up with a person to help me show me how to cut onions.
And that was a crew person. [00:23:00] She would set me up with the person to show me how to use the grill. That was a crew person. She would have someone show me how to do an inventory. That was a crew person. So I was really being trained by the crew people. And what I learned really quickly is these crew people were awesome.
They were really smart. They were really cool. They were super ambitious. And ambitious not to get ahead because they didn't know they could, but ambitious to deliver great, a great customer experience. So cook great food to be the best grill, cook, to be the best person, slicing onions, the best prep cook, I'm the best at cleaning the best at doing an inventory.
They were really great. And I was like, man, these people are awesome. There's so much better than I will be in six weeks. Cause they'd done it for years. And so anyway, so I learned, wow, these people are awesome. And so I'd asked them, you got ask the crew people, Hey, so what do you want to do? Do you want to be a manager here someday?
And they'd be like, and they look at me like. Yeah. It the exact way that if I said to you, Hey Holly, do you want to be a man? Do you want to win the lottery? You'd be like, yes, what's the track. What's the catch? Why are you asking me that? Do you know what I mean? And so if you want to win the lottery yeah.
I want to win. But are you saying, I'm not going to win the lottery, so why are we talking about this? So that's the way they looked at me. Yeah, sure. I'd like to be a manager, [00:24:00] but, and so they'd say I say, what do you wanna do in five years? I'll just keep doing this. Great. I love my job.
No, but would you like to be manager? Yeah, but they had no thought that there was any possibility to becoming a manager. And I thought that's wrong because these people, I very quickly knew it would be a much better general manager that I would be. And what we were doing at that time is we were hiring people with fast food experience.
The vast majority of which were white people to go in train with the largely Hispanic crew to become managers. Not that well, this is wrong, it doesn't make any sense. So I made up my mind then, Hey, why don't we train these crew people to be our future managers? All of our managers in the future should come from crew.
Cause these people are better. You already know a bunch of things about them, don't you before, will they be a good manager? You don't know for sure, but you do know, they show up on time every day. You don't, you do because they've worked for you for 2, 3, 4 years. They're going to show up on time every day.
They have a great attitude, they're hard worker, you know that they are really nice, that they care, they've got integrity. You know that they're honest. That's 99% of the battle. Can you teach them to be a manager? That's the. That's the easy part, teach them how to use the keys, to open the front door and teach him how to hire someone, fire someone onboard, someone, teach him how to deal with really [00:25:00] sophisticated customer service complaints or problems.
They can learn all that. Good Lord. They can learn it easily. So very quickly during my training, I said to Steve and the other officers, I said, We've got to get rid of this MIT training program and stop hiring people with experience off the streets. And instead, we've got to rely on our crew people and that's going to do a ton of things that are gonna help our company.
Number one, we can stop hiring people with experience because what is that experience? Fast food experience. Is fast food experience, really good experience. Did we think of any other fast food restaurant is having awesome people, especially these are people who don't work there anymore, who couldn't maybe hold their job at a taco bell or whatever, and so we're hiring the people who aren't the best fast food workers for fast food experience. And we don't even value the experience they've had because the experience they've had might be that they were operating something, mess messy and serving bad food and giving bad service. So why look for that?
Why look for that? Why not look for someone with character, which is the one thing you can't train, you can't train care. That's up to your parents when you're one year old, 2, 3, 4, 5, 6, 7, 8 years old. And so you either have that or you don't, by the time you come in as a 18 or 19 or 20 year old person for an entry level job at Chipotle, [00:26:00] like you have that character or you don't, if you're dishonest, I can't train you to be honest.
Can I probably not. Can I train you to be happy or enthusiastic or motivated? Probably not. I said, Hey, if we hire everyone from crew, here's, what's going to happen. First of all, we're going to inject so much enthusiasm into our crew because they're going to be like, man, these people care about us. They believe in us.
There's a chance to move up and guess what they're going to do. Especially in the Hispanic community. There's a lot of people with large families, they're going to tell their brothers and sisters, and aunts and uncles, and moms and dads, and say, Hey man, you should work. This is awesome. This is a great job.
We're going to move up. I'm going to move up at this job. And the word's going to get out through not just Hispanic community, but through all communities that Hey Chipotle is a place where if you get a job there, even at the entry. You're going to become a manager, right? So we're going to have more enthusiasm at the crew level.
We're going to have more people applying for jobs. We're going to have more people to pick from, in terms of choosing who our future leaders are. We're going to have much, much better managers. And then I actually went back to the corporate office when I came here. Thought and looked at the data.
It looked. Are there any people who have gone from crew positions to manage your positions? There were very few. Okay. Statistically, very few. There was, but there were still [00:27:00] dozens and dozens that had, I looked at their performance versus the performance of people hired from the outside. And what I found was that the people who came from the inside that is to say from crew positions, it had much, much, much better restaurants ran better operations and were four times less likely to.
The turnover was four times less. So that was a home run anyway. So we started doing that. We got an overtime. I said within two years, we're going to hire 100% of the people from within. And we might not have achieved a hundred percent what we achieved 80 or 90% in two years. And within a few years after that, we were like 95.
Fired from within, and the only exceptions to that, where we'd find someone who was a hot shot at Starbucks and say, Hey, come on. Or wherever, someone would get to know someone. So one of our people would get to know someone and say, come to spotlight and we'll train you real quick to be a manager.
And we fast track a few people, but almost everyone else came from a legitimate group position into management positions. And it was a home run for our county.
Hala Taha: [00:27:48] Yeah you clearly have some great leaderships scales. You clearly know how to empower people, make them motivated. Really cool stuff here.
Let's talk about your leadership [00:28:00] style. So your book, which is coming out, when is it coming out?
Monty Moran: [00:28:04] The 20th of October, because it's a few days here at Tuesday.
Hala Taha: [00:28:07] Okay.
I think I'm going to put out this episode Monday, so it'll be right on time to help you promote your new book. It's called Love Is Free. Guac Is Extra: How Vulnerability, Empowerment, and Curiosity Built an Unstoppable Team.
So I definitely want to dig into all of this stuff. Let's start off with your definition of leadership. I know you have a unique definition of leadership. What is that at a high level?
Monty Moran: [00:28:30] Yeah. So basically I look at management and leadership as totally different things. And most people just, we talk about managers, even if we even kept the general manager label, but we really didn't want general managers to manage.
We want to general managers to lead. So basically management is about getting someone to do what you want them to do. Hey, I want you to keep this restaurant clean. I want you to serve good food. I want you to give good customer service. Please do that. Thank you. That's management, and the people who can do that well are valued in our society. But leadership is something much more powerful and much more enlightened leadership is about getting someone to do something [00:29:00] that they themselves find value in that they want to do for themselves. That also happens to advance the cause of the organization.
Chipotle in this case or whatever. So I have to find something in you, you know that I have to know you. I have to care about you enough to know what makes you tick to know what, like really fires you up to know what excites you to know what brings the best out of you. Okay. And once I find that about you, I find out where does that dovetail with what our organization needs?
And the answer is usually that there's an enormous overlap, right? Like I can do something that's going to help you become the most powerful version of yourself while simultaneously advancing the organization. Okay. So that's where leadership is. It says that juncture between finding what you're passionate about, and what's going to make you have a great life and enthusiastic, fun, excited life, where you're at your very best.
And the thing that actually helps my organization or the thing that the boss quote unquote, boss or leader is in charge of also have a huge advantage from your work. Okay. So it's a win-win, it's about finding that way. And that's leadership.
Hala Taha: [00:29:59] I think that's an [00:30:00] excellent definition of leadership. So when you are at Chipotle, you actually had a reputation of having these really great one-on-one calls with your employees.
So there was like 75,000 employees who worked at Chipotle, and I think you had 20,000 one-on-one calls. This reminds me of somebody named Claude Silver. I'm not sure if you know who she is. She's a chief heart officer of Vayner Media, Gary Vayner checks, right-hand woman at the company. And she has a goal of touching every employee and they basically have a role designed for her
to connect with employees. And basically it sounds like she had a very similar job to what you had at Chipotle only they call it like a chief heart officer. So there's obviously a trend out there in terms of, connecting with your employees and things like that. So why do you think that having a strong culture is an important aspect to having a well-run company and why did you decide that was something that you needed to take over at Chipotle.
Monty Moran: [00:30:58] first of all, that's a cool chief heart [00:31:00] officer. That sounds cool. And I'd love to meet her. That's really neat. It sounds like she's doing sound great at Chipotle we we had 75,000 employees in 2015, I think. In 2016, that grew about 75,000. At that time we were hiring though. It's a very high turnover business, even though we had lower turnover than all of our peers, it's still over a hundred percent a year that already exists.
So we were hiring a hundred thousand people. Okay. A hundred thousand people hiring a year. But what I didn't have phone calls with people. I sat down one on one with people. I was traveling to restaurants all over the country. And every time I went to any restaurant, I had a rule. I would sit down with every single person one-on-one at a table and talk to them.
And some of these conversations were five, 10 minutes. Three hours in the rare case, but it just depended what I was learning and a few things happened during that. Okay. So I, first of all, I really got to know people and what really drove them. I got to know what they loved about the job, what they didn't like about the job, what we were doing well in the restaurants, what we were doing poorly in the restaurants, what our best leaders were doing really well.
Worst leaders were doing it, wasn't helping. And so I got an understanding of the entire leadership structure of the company. I got an understanding of the operational space, specifics of the company. I got an understanding of the [00:32:00] individual people in the company, the kinds of people we're hiring, whether we were making the right hiring decisions, whether we were training them properly, landing them in the job properly.
In other words, what did we do on their first day? Did we give them something a really encouraging first day that made them feel good and welcomed and invaluable? Or didn't we. That and a million other things I would learn from during this conversation. So these, even though I was CEO of the company or co CEO, these conversations, which took yeah.
A large percentage of my time. Maybe it was 30 or 40% of my time. I was in these conversations. But guess what? During that 30 or 40% of my time that I was actually talking one-on-one with people, I was learning how to run the company better, how to be more efficient, how to waste less food, how to buy better food, how to prepare the food better.
What techniques were best, how to run the restaurants better, what equipment to buy, what equipment not to buy, how to calibrate the equipment. How do you, how to treat the equipment? So it would last longer, in a million. Thanks. Okay. Lots and lots from which I was able to, as I left every restaurant on almost every occasion after every visit, I would leave that restaurant a really understanding the people in the restaurant, understanding whether it was run as well as it could be understanding whether the operations were excellent, understanding what they're not a great leader, but I'd also understand [00:33:00] something global about what we could do better as a company.
And I would call whoever's in charge of that particular skill, whether it be, if it was someone who's in charge of, of operations or an operations officer, or one of our regional directors. Let's get the regional director together and talk to them. We're going to change the way we cut an onion because we can save, we can use 10% more of the onion to have much better cut sizes, which would yield a much more delicious food by doing this one thing differently, everywhere.
So even though it was very specific when you roll that out over what ended up being when I was there to over 2000 restaurants, small changes make for huge savings or huge benefits to the customer. That was just really awesome. And so I just went and I sat down with people at every restaurant and I would, and it wasn't like I went there and quizzed them about something specific or said, Hey, how can we do better?
I would, first of all, just go ahead. How are you? And how do you like it here? What's it like? And I'd get to know them personally, but getting to know people personally and actually caring about them and caring about who they are, what their heart feels like, how they feel being at Chipotle.
Helping them become a better person, happier person, a more fulfilled person, whether it's helping them be a better father, a better mother, a sister, a daughter, a brother, whatever. So I would [00:34:00] sit down with these people and just really work on helping them be at their best. And they were blown away. People would all the time.
Oh my God. I can't believe you're the CEO. I didn't think you'd be like this. I thought you'd be like, I was like, what would you think I'd be like I didn't think you'd be just like such a normal. And I'd be like okay, cool. I'm glad I'm an overseas. And it was like people expected to, because I was in the top job in the company that I would have some sort of air of superiority.
It's not just that I didn't have an air of superiority. I know I'm not superior. There's nothing superior about me. I just had more time in the job and I had more experience and I had worked really hard and I'm older. It's I'm not that wasn't superior to anybody. In fact, a lot of these people, I was blown away by, each and every one.
I was blown away by something like there better. I was like, wow, they're so articulate. Or some people are like, oh wow, they're so sweet. Or, oh, why there's such the way they look at you with their eyes is so nice. I feel like safe, so people have all these different characteristics. And basically by finding out there the beauty of individual people and understanding them and actually learning and loving them.
You can't help, but love someone when you really get to know them and understand what's in their heart. It's very hard not to love them. So basically people found out that I loved them and when I loved them, they were like, oh man, this is awesome. [00:35:00] Even the CEO, like you love it. And he loves this company.
He loves this culture. And so people began to really believe in the culture as something real, they believed in that the company actually was, a company of people who cared about them. And so then more importantly than my own interviews, the most important thing I did was. The hundreds and hundreds of field leaders, how to sit down, how to have these conversations, how to learn to actually really care about the human beings.
Because by caring about human beings, you get much better operations. You get much better financial performance, all the things that the shareholders wanted, you'd get the most of that way.
Hala Taha: [00:35:28] Yeah. And I think people probably felt really valued because, I've worked at HP. I work at Disney streaming now and having a conversation with the CEO is unheard of unless you're an SVP, you're a senior level executive.
You're not really getting air time with the CEO. And so that must have made them feel really valued, really heard. And that's really important when it comes to motivating your employees. So I think that was an excellent strategy.
Monty Moran: [00:35:53] Absolutely. Yeah, it w it was, and everybody, and I don't care. What position you're in everyone actually works [00:36:00] better from a position of passion and a desire to do well, knowing that they can do well in a sense when they're empowered, basically.
And my definition of empowerment is feeling confident in your ability and encouraged by your circumstances. Such that you feel motivated and at Liberty to fully devote your talents to purpose. So people are at their best when they're confident, their ability and encouraged by their circumstances. So confident your ability is pretty easy.
You train someone so they know what they're doing. That's that simple. And I talk about it in my book, but I don't make it that much more complicated even in my book. The harder part is creating encouraging circumstances. So when are your circumstances encouraging? If you ask anyone that you ask them to really think about it and to think about someone around whom you feel at your.
And sometimes people say, oh, I feel that way. Run my father or my mother or my sister, my best friend. And and some people say my father makes me feel terribly unempowered, it's all over the gamut. But someone, you can always think of someone around whom you feel at your best, with that person is doing is creating, encouraging circumstances and the way they're always doing it. And it's almost always the same. It's always the same anywhere it's that they care about you, believe in, you come to know you want what's best for you. Challenge you. Won't stop until they see you at [00:37:00] your best, right?
So you're the person you feel the best around isn't it someone who, if you're, let's say it's your parents, if you're a 15 year old kid and you come home, smoking a joint, your left hand on the scotch and your right hand and your parents like, Hey, that's great, man. As long as you're happy that's not what the parent's going to say.
If they're an impact, that's not encouraging circumstances. That's like letting someone not be at their best, a great parents, not going to necessarily is not going to tolerate that. They can be like, Hey, wait a minute. Hey, you're a young person. You have a life ahead of you. Let's get you on the, you gotta do better.
I, you're really smart. You can do more than this. So it's not always going to be sweetened. It might be quite rigid and disciplined at times, but overall that person's going to be someone who cares about you believes in you courage and wants you to be at your best and will not rest until you are at your best and that's encouraging circumstances.
And so when I started doing it myself and then trained the other hundreds of field leaders to do this, the whole culture, it became this place where we created encouraging circumstances. And in those encouraging circumstances, guess what people are at their best. A friend of mine recently wrote a book called Choose Love, Not Fear.
And if you just think about that title, choose love, not fear. And it too is a leadership book that talks about a lot of the principles. That I happen to cover in my book and basically the point, if you [00:38:00] could summarize it, it's that, when people are in fear, they don't work very well.
They're not at their best, not they perform poorly, but when they're feeling loved and cared for, and then are also challenged, right? It's not all about just love and kumbaya. There's, it's got teeth, it's got teeth too, right? Like you're demanding that people do well. You're going, we've got to do excellent work.
You've got, and you also have to have a vision, to empower someone. Someone has to have a vision and work towards that. And the vision can be very difficult to achieve a lot of these companies that have super ambitious companies that are performing incredibly, but they have all the employees rowing in the same direction.
What might be a very difficult thing to achieve, but something that everyone deems incredibly worthwhile, so may be very hard, right? Like climbing, Mount Everest, maybe your vision it's hard. But you're going to you, you think about that feeling you're going to, how are you going to feel at the top in the sense of satisfaction and fulfillment?
And so you're willing to work very hard to take very difficult steps through deep snow, through horrible, freezing temperatures, through danger. What have you to get to the top of that mountain? So it may be very difficult, but you're still encouraged by your circumstances because each step, is getting you closer to you.
[00:39:00] Hala Taha: [00:39:00] Yeah. So I want to take a step back and talk about your teenage years. You mentioned previously, you worked, several years at dairy queen, and I read that you used to meet homeless people and hang out with homeless people at dairy queen. And I think that probably had a lot to do with your leadership style later on and influence.
The way that you ended up leading and your need to connect with people and have no judgment against people and being able to relate to them. So can you tell us about that story and maybe what you learned from it?
Monty Moran: [00:39:30] Yeah, that was incredible. That was an awesome job working at dairy queen and we were just lucky for a few reasons, but one reason we were lucky. Our dairy queen was located just a block away from two different mental health facilities. And so there was these homeless people, and most of them that came into dairy queen were mental health patients. And they would come in and they would usually buy a coffee. And that was it.
And they'd sit around. They wrapped themselves around that cup of coffee for 2, 3, 4 hours sometimes all day, and and so I would, during my breaks, I would just go say hi to them. Hey, how are you doing? And a lot of them would look up and I think. [00:40:00] Oh, good. Hi. But you could tell they were actually like, almost shocked that I took any interest even enough to say hello.
I don't think many people saw value in them. Oh horrible shame. Cause they're incredibly valuable people. So I would sit down across from these folks on my breaks. I had 15 minute breaks, twice a day or whatever, and, or on my lunch hour sometimes. So I'd take a whole lunch with them and I would sit down and say, Hey Hey, how'd you come to be here?
Like where are you from? And they'd be like, oh, I'm at the mental health facility over there. And they might say that with some embarrassment oh, cool. Is it cool? Is it. And that was just super curious. And I had no judgment, like no negative judgment. And that's something that I think just is broken in my brain.
I don't have negative judgements about stuff that other people do. So I don't think it's bad to be homeless. It's only bad if someone's not enjoying it. I don't think it's just inherently bad. Someone might choose to be homeless. When you go camping, you're homeless for a minute. Some people like to camp, some people like to camp six months at a time, that's almost kinda, I don't want to dumb down the problem and say, it's not a problem.
It is for a lot of people, but I just said, Hey. Like, where do you live? And they be like, oh God, I'm not, I don't have a home right now. I'm just, I stay in the United States. Behind the river, under the bridge. Oh, wow. What's that like? Is it, [00:41:00] you have some freedom I guess. And yeah, they'd laugh.
Yeah. I guess I'm free, but how do you like it? I don't know. I guess I'd like to have, I'd like to have somewhere to live. Oh, wow. So how are you going to do that? I dunno. Right now it's really hard because blah, blah, blah, blah. So I just talk to them and ask them and it learning how they got to be, where they are, what their life was about, who they loved, what happened
that led them to this place that was sometimes very difficult for them. And and a lot of these folks were, they had maybe some dysfunction, mentally. They were having a hard time and struggling, but I found such value in their struggle because I'd had less struggle. I'd come from a family where I knew where my next meal was coming from.
You know that generally speaking, I wasn't worried about my safety. I wasn't worried about a place to live. And so I learned so much from dozens and dozens of people who really were concerned about having a place to live, who really didn't know where the next meal was coming from, who were making maybe some really bad decisions, like buying cigarettes instead of food or, drinking only coffee and putting tons of creamer in it to get their calories.
So I started to say, Hey, why don't you like, why don't I get you some food? And I got to eat free food when I was at Chipotle. When I was troubling too, but when I was at dairy queen, one of the things I loved about the job is they'd let me eat for free. And so [00:42:00] I would bring my lunch out and I would share it with them and I go you're half, half my hamburger and they would eat it.
You could tell they were hungry, really hungry sometimes. But then I would just notice that they would start to get nursed back to a better place. As I talked to them day after day, week after week. And really, I think most of the better place that they were coming to it wasn't because they were necessarily eating better.
Although some of them really started to prioritize like food instead of cigarettes, or maybe instead of a coffee, they get signed to eat and you get a chicken sandwich. Cause we had food at that dairy queen not just hot dogs, burgers and chicken sandwiches and fish sandwiches, that stuff.
And anyway but I noticed that a lot of them would start to really feel more confidence as it came and be happier. Their head would be held higher. They talk more to me, they'd take it more of the conversation. They you'd see their confidence being restored. And I think the biggest thing that restorative conference is just that I love it.
And they were seen and understood and valued. And in that being seen and understood and valued, those are parts of the things that I just said to you were part of encouraging circumstances. So all of a sudden these people who were in maybe very not encouraging circumstances, very lonely hungry, poor maybe not not a [00:43:00] lot of people that were caring for them or looking after them.
Maybe nobody, all of a sudden there was at least one person myself who was like going, Hey, how are you? And I knew their name. Hey, Tim, how are you doing today? It's great to see you. Oh, you look good today. Are you feeling better? Yeah. Oh good. Hey, I noticed you're not smoking while I'm trying to give up cigarettes.
Good for you, Tim. That's great. And I was encouraging them and I cared about them and I knew them and I got to see who they really were. And I saw that the beauty in their hearts and having someone look into your eyes and see the beauty in your heart makes you see the beauty in your own heart. It starts to heal you.
It starts to make you feel better about the person you are. And guess what, when you feel better about the person you are, then you are a more productive person who can add more value to the world around you, start helping others and maybe even get paid for that. If your person without one.
Hala Taha: [00:43:42] Thanks for listening to Young And Profiting Podcast. If you enjoyed the show, please write us a review or comment on your favorite platform. Nothing makes us happier than reading your reviews. We love to hear what you think about the show, and don't forget to share this podcast with your friends, family, and [00:44:00] on social media.
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