Episode 6:

Welcome to The Upstream Leader. My name is Jeremy Clopton. I’m your host today, and I’m excited to be joined today in studio by my co-host, Heath Alloway. Heath, how are you?

Doing well, Jeremy. Good to be in person.

Yes, definitely. It’s our first of our quarterly recap episodes, and what we’re looking to do today is give you a little bit more timely information on what we’re hearing from around the profession, hearing from different leaders in firms across North America, as well as kind of recapping the various things that stuck out to us, or any big takeaways from our first few guests on the podcast.

So, with that, it’s going to be a little bit of a different style than all of the episodes so far— maybe a little bit less formal, but nonetheless, it will be very impactful for you as a leader.

So, Heath, what I want to start off with is, you’ve been working with a number of firms through programs and just outreach over the past, you know, six months specifically here. What is the topic that has really been top of mind, that you hear a lot of leaders struggling within the profession?

Jeremy, there’s definitely some topics that stick out. And you said “struggling with”—in some ways, I see it as an opportunity as well. You know, with many of these topics, I think it’s situational with what people are going through and how they face that. Probably the topic that has been most front and center, it’s been around that idea around capacity—recruiting the right people, and then retaining the right people. And that’s been a big impact in many firms. So there’s a couple things I want to acknowledge out of the gates: I realized the last 18 to 24 months, it’s probably been a little bit of a different ballgame. But this thought around capacity, as I think through it, it’s something that more than likely, hasn’t always been there—it’s been close since the inception of what we do. And when you start to peel that back, we all have limited time. We all have limited time in a day. And so it’s taking that, and trying to figure out where and how we spend our time.

The mistake I think many people make is they can get so honed in on capacity, or what they have on their to-do list, it can start to become that self-fulfilling prophecy. And you look over the past 18 months, 24 months, however long it’s been—I think people have been stretched out of their comfort zones, and growth happens when you’re out of your comfort zone. But also, I think sometimes if you’re out of your comfort zone too long, it can have a negative effect—and it’s not just work, it’s been a lot of areas in others’ lives that have maybe caused some of that stress.

But I don’t want this to be all doom and gloom, I want to share some thoughts that I’ve seen across the profession, and really ways we can tackle this, and really how to be the most impactful with your time. And so just for me, one of the things—I’ve struggled with it before too—I’m at home, and I feel like I should be at work, or maybe I’m at work and I feel like I should be spending more time at home. And I’ve really tried to change that mindset and ask myself the question of, “What’s your bigger purpose? What’s your bigger goal? And what are you trying to do, not only in your professional life, but with your life as a whole?”

And that’s going back and thinking about, although yes, maybe they will last year and a half, it was challenging in a lot of ways, we’ve also learned a lot. You think of the impact that you’ve had on your clients, conversations you’ve had with them. Maybe many clients, it’s their livelihoods are on the line. So you’re helping them work and navigate through those waters. Or maybe your spouse or your kids or when your team members—you just never know what they’re going through. So stepping back, getting out of the weeds and just focusing in on what’s your greater goal and your greater purpose. And that’s not going to solve everything, but it’s helpful.

The second part, and I wish I could take credit for this, but the work-life rhythm. It was a newsletter from Jon Gordon that really stuck with me. It’s not necessarily work-life balance, but knowing at times you’re going to have peak work times, or knowing there’s times where you’re going to be at home more. And when you know, when you have those peaks and valleys, you’re very intentional about where and how you’re spending your time. When you’re at home, you’re committed to your kids, or your spouse, or when you know there’s going to be a peak time at work—maybe you have a lot of presentations on the horizon—you’re really honed in there so you don’t get in the trap of thinking “Gosh, I need to be at home or I need to be working”—whatever that may be.

And the other two areas that especially for CPA firms, the thought about the client ranking and client screening process—how and where to spend your time with your clients. So I’ve seen and heard that some firms are actually turning away work because they can’t get to all of it. So it’s stepping back and evaluating your A and B level clients on where and how do we spend our time with them? This may seem counterintuitive to growth, but maybe it’s letting go of some clients, or maybe it’s just not accepting certain type of clients. And I think that that can be a powerful exercise for an individual or a firm, and really the main goal there is to end with a better book of clients, you know, when you end the year than when you start the year.

The other big thing that I’ve seen in a lot of firms—approaching new advisory type services. So kind of thinking, “What can we do different to help us be more successful in the future?” And there are a lot of different services out there, and we could probably talk about that for hours. But just the mindset—and you and I will talk about this—of making money while you sleep. The thought of, “Can a service be more leverageable? Could you approach a service where you’re pricing it differently towards more profitable, and it’s not just always tied to charge hours? It’s tied to the innovations in doing things differently.” So those are some key areas to me, Jeremy, that really stuck out over the past few months.

And that discussion around capacity: It’s interesting, because in your entire discussion there around capacity, you rarely mentioned hours—which is, I believe a very big misconception around firms is when they say “Well, people tell me they’re at capacity, but the hours don’t show it,” or “We feel like we don’t have the capacity, but maybe the hours don’t show it”—capacity is more than a mathematical equation. It’s not “Did you work X number of hours?” Capacity is really, “Do you feel as though that you can do the work that needs to be done, at the quality level that it needs to be done.” And where you started in discussing capacity is really your focus. I think that’s so important that, like you said, when you focus on the fact you don’t have capacity, you still don’t have capacity—and it just creates less capacity.

And it goes back to a Covey principle of the time quadrants, and getting into that quadrant two, and his advice there, which is arguably the most frustrating advice probably anywhere, which is, “If you want to spend more time in quadrant two, spend more time in quadrant two.” Really helpful, right? That tells us exactly what we need to do.

But I like your description of how you overcome capacity, because you overcome capacity by changing how you provide services, by changing your mentality away from “time is the only thing that I’ve got,” by looking at who you’re doing work for, and how do we do more work for fewer clients—because often those D-level clients, getting back to what you were saying about the rating scale, they take the most time, they take the most resources, and they provide us the least in revenue. So they’re not profitable very often. So I like that discussion around capacity. Anything else on capacity that just really jumps out at you? That firms or even individual leaders could really use to help them overcome this challenge?

Yeah. Jeremy, the main thing that sticks out with that question is around education—communication, as well. One of the big things that, especially with like a new service, for example: if you still have your current workload, if you’re not figuring out a way to delegate your work, or your responsibilities—and by the way, when I say delegate, you’re also developing someone else by letting them get involved with new opportunities, so I think that’s important—but sometimes it’s simply sitting down and having communication with your coach or your firm leadership. And when I say having a communication, go in with a plan: If I’m launching this new service, here are the areas where I’m gonna have to focus. Here’s how much time I’m gonna have to spend. It’s having a plan. It’s not just going to your coach or your firm leadership, and saying, “Oh, by the way, I’m at capacity. I don’t have time for this, I don’t have time for that.” Go in with a plan on how you’re going to do it, and my guess is the good things will come out of those conversations—and maybe you don’t get exactly what you’re asking for, but you’re educating and moving the needle in the right direction. So that’s one of my other things, is just be intentional with your time.

Yeah.

In that discussion with your coach or from leadership. So hopefully, that’s helpful to our listeners. Well, Jeremy, let me flip the question to you, because I know there’s very similar—you’ve had a lot of presentations, a lot of firm engagements, a lot of discussions over the past several months. Not only that, also podcast interviews. So what have you seen other leaders talking about? And I’m going to use the word opportunities instead of hurdles that they have on their horizon?

That’s a much better way to position that. So the most recently, there’s been a lot of planning of retreats, and a lot of discussion really around bench strength, and leaders and who has potential. And a concept that keeps coming up, even if it’s not named, but the topic that keeps coming up is really this concept of being a high yield, low maintenance leader.

Often when we’re talking about it, it’s through the lens of the partner group. You want a partner group that is high yield, and low maintenance. And the question always comes up, “Well Jeremy, what do you mean by high yield, low maintenance? It sounds really great, almost like a great catchphrase. But what exactly does it mean?” 

Yield is essentially your ability to deliver results. It isn’t necessarily just effort. This is not high effort, low maintenance leaders—this is high yield. So they’re able to get the results that they’re looking for. And then low maintenance, and when we say the word “maintenance,” it’s really consumption of resources within the firm—whether those resources are monetary, or it’s other people’s time, or other supplies, whatever the case may be—in the way that this keeps coming up is in a few ways.

One, back to capacity, like you said. Hearing partners saying that, you know, they don’t have capacity, they don’t have time to work on these different things, and it goes back to, well, are you being intentional in being a high yield low maintenance leader? Because if you are doing too many things that are “below your level,” so to speak—and I don’t use that in the normal terminology where somebody says, “Oh, well that’s beneath me.” But are you doing, if you’re a partner, are you doing partner level work? If you’re a manager, are you doing manager level work? Because if you’re spending your time, your resource, doing the work of somebody else that you should be teaching to do that work, essentially, you’re being a bit high maintenance, because you’re consuming your own resources to the detriment of the firm, rather than to the benefit of the firm.

That then leads to capacity issues, it can be accountability issues—there’s so many different ways that this concept shows up. But time and time again, it seems like every conversation goes back to this idea of how do you help people become high yield, low maintenance?

And Jeremy, one thing you said I would add to, you talked about the idea of delegating, or transferring work. And you said, the terminology around work below me, it’s not work below me—we’re supposed to be developing and coaching others as well. Then it’s almost a disservice as a partner or senior manager, manager, whatever it may be, if we’re not intentional, with activity like that. So I’m gonna ask you another question. It’s kind of maybe a harder question around that high yield, low maintenance. Is it possible for everyone to climb that mountain and become high yield and low maintenance, no matter what level they’re at in their career?

Is it possible? Yes. Will most accomplish it successfully? Probably not. If we really step back and look at it, again, you’ve got two different characteristics here, so you’ve got essentially quadrants:

You’ve got low yield, low maintenance. And low yield, low maintenance, sadly, flies beneath the radar probably a little bit too much. You’re not hurting the firm by consuming too many resources, but you’re not really contributing. I kind of liken that to cruising just a little bit. You’re comfortable, you’re getting the work done.

Going through the motions. 

Going through the motions. And in some areas, it’s probably good to have people that are just getting the work done. They’re not overly productive from a yield standpoint, but they’re there.

Low yield, high maintenance. Most firms don’t have people like that, because they don’t tolerate it. There is so little tolerance for that. So if you’re low yield, and high maintenance, you’re going to know—really quick, and you’re gonna have to figure out how to overcome that.

Where we see probably too many in our profession, is they’re high yield and high maintenance. And they think that, “My results are so great, it’s okay that I’m difficult to work with, or it’s okay that I’m consuming so many other people’s time, or it’s okay that…” whatever they want to make an excuse for, right? Because “I’m high yield, and I’ve got these great results.” It’s possible for every individual at every level to get to high yield, low maintenance, but you first got to have that desire. And it starts with a bit of removing the ego, and coming out of a place of arrogance, and figuring out “how can I benefit the firm the best?” And then keeping in mind yield and maintenance are two different things.

Yield is again, results. You can focus on your results. And then maintenance is the resources you use. I was talking with a group of leaders earlier today, and we were talking about, “How do you overcome your weaknesses?” You overcome your weaknesses by intentionally focusing on getting them back to neutral—that makes you then lower maintenance. Because often our weaknesses create that high maintenance, that overconsumption of resources. So it’s can even be little things like that. But it takes intentionality and a lot of awareness,

I would add patience to that too.

Yes.

Because you think of high yield—you’re wanting to get on the right radars in the right way. And over time, it doesn’t go unnoticed, but sometimes climbing that ladder, it takes more time than you want. Because in a world that moves so quickly, you have to continue to do the right things time and time again, to get the right kind of recognition. So with the high yield, low maintenance concept, was there anything that really stuck out from your interviews over this past quarter?

There were a couple things that stuck out. I don’t know if they’re necessarily tied to the high yield, low maintenance, but one definitely goes back to what we talked about with capacity, and that was in our very first episode—Courtney DeRonde was talking about the fact that they capped their hours during the week or during the year, and they created a lot of capacity. That was so intentional. She even said, “We had to go train people on how to be productive,” which isn’t something we really a lot of times think about. It seems like we could just tell people, “Hey, go be productive,” and they should know how to do that. But she recognized, we’ve got to teach people how to be productive, and that goes back to yield. Sometimes we assume that people know how to become high yield, but unless they’ve been taught, maybe they don’t.

The other thing that really jumped out at me, was the interview with Bethmara. She said that early on, she realized that conformity was very closely tied to success. That’s been a while since she entered the workforce, she admitted that. You know, we talked about that, she’s now retired. So it’s been a little bit since that was the case, but we’re still battling that. And early on in individuals’ careers, one of the opportunities for them to become high yield, and low maintenance, is to figure out how to harness their passions, and their excitement in a way that’s beneficial to the firm.

When we push conformity: “Be a good tax professional, be a good auditor,” without the ability to really be yourself and be your authentic self, we lose that ability—and we’re almost hampering their ability—to really be as high yield as possible. So those are really the two things that stuck out to me was, how do you how do you train people to be productive, and then overcoming this mindset that success requires conformity.

Right. I think a lot of that goes back to the capacity again.

Of course.

I’m gonna keep going back to that about how and how and where to spend your time. You know, as I reflect over the past quarter, and you talked about the conformity, one of the things that I really enjoyed this past quarter—podcasting is actually pretty fun.

Yeah! 

And grit, the the idea of trying new things, talking with Damien, about, you know, his journey with his podcast, and I’m not gonna lie—I told someone about it the other day, and I told him, “Even if we just connect with 50 people, or 100 people, and we make a difference in their career, then I felt like I’ve reached my goal.” Hopefully it goes way, way bigger than that, but if we can just make a difference in a few people’s career and their journey, it’s been very rewarding. So just that idea.

And being okay with failure, because I think that goes back to conformity as well: you have to be okay with failing. When I say failure, maybe it’s not necessarily failing, but you’re learning from that failure. So call it more of an evolution in a way.

Yeah, and I would agree. Taking on a podcast was a bit of a risk. We had to be willing to fail on those first few interviews. And I know, I’ve learned with every interview that I’ve done, and I’m sure that the next quarter is going to be better than the first quarter. And hopefully, that spirit of continuous improvement holds true. And every single one of them gets better.

Anything resource-wise, or just anything that you’ve learned over the past quarter that you think would be really beneficial for leaders that are listening to this podcast?

There’s a couple things that I have, Jeremy, and one of them was, one of my discussions with Shaun Hill, NFL quarterback. One thing he said, and I probably won’t hit every word. But it was along the lines of, can you imagine just like in the NFL, where they record every game that you play, and then you watch it with your peers, so the thought of, if your whole life was on videotape or being recorded, how would that be viewed? He said we’d all be pretty good people if that was the case! 

That really stuck with me, and kind of goes back to the intentionality piece, that everything that we’re doing—you know, just imagine if that’s out there for everyone to see. And in a way I guess we’re kind of doing that with our conversations in the podcast. So that really stuck with me.

And then there was a another podcast I listened to recently with Jon Gordon, with a gentleman named Mark Batterson, 7 Habits to Help You Win the Day. And I think this held true during COVID—transferring into the environment that we’re in now—because I’m one of those people that, I like to feel like I have a vision, but sometimes those visions, it takes a long time to get there. And it’s easy to get wrapped up in progress. And one of the things that the podcast talked about was just winning the day.

So if you get up and you have in your mind, starting, one of the most important things you do is just run out of the gates. Whether it’s working out or maybe it’s spending time with your spouse, or maybe it’s taking 30 minutes to pray or meditate—whatever you do—it’s starting off the day very intentional, and it sets the tone for the rest of the day. And then if you do that the next day, you have a winning streak. So there’s two days in a row. And that’s really from a goal setting, and what I’m trying to do, really honing in on those micro goals of, what can I do each and every day.

And that gets back to the capacity piece of getting caught in that trap of, “I’m at work, I need to be spending more time at home, or I’m at home, I need to be spending more time at work.” Whenever you have the mindset of, win the day, do something right out of the gate, personally helps me be very intentional with what I’m doing. And it’s just stuck with me every morning, I’m waking up and thinking “Win the day, What can I do out of the gates to win the day?” Not  saying I win every day, but it definitely puts me in a better position. It’s been very, very helpful.

What about you, Jeremy? What else from your end? I know you read all types of books and podcasts. So I’d be curious, what have you gathered over the past quarter?

Yeah, so everybody’s probably expecting me that knows me, is probably expecting me to throw out at least one book recommendation. And I think for the first time, I don’t necessarily have a book recommendation. In fact, it goes back to a podcast I listened to a few weeks ago, and it was talking about three different types of people: Two of them in particular, were the “content zombie” and the “executer.” It’s ironic that I was listening to a podcast and they’re talking about content zombie and the fact that you can consume, consume, consume, consume, and that’s great and all, but what do you do with it?

I really started thinking about that. Because, you know, there have been years I’ve read 50 plus books a year. And I take pride in the fact that you know, I read all these books, I listen to all these podcasts. But it really stuck with me and it’s, you know, it was really this concept of “Okay, that’s all great. But if you’re just walking around with information you consumed, you’re not any better than you were when you started listening.” It goes back to your win the day concept. How do you get 1% better, even? And that’s that concept of being an executer. What are you going to do with the information?

So I’m kind of reevaluating some of my reading goals and different things along those lines, and one of the podcasts that I listened to a lot, and you know, Heath, I’m a huge fan of Brené Brown’s work. I read her original book, The Gifts of Imperfection last year sometime. And she and her sisters are actually doing a podcast series, going through the whole book—a six part series over the summer, going back through the book, and I thought, “I’ve not really reread a book ever, that I can think of unless I had to, you know, write a paper in college probably.” So I thought, “You know, this is a really good chance to become an executer. And instead of just reading another book, I’m going to go back and reread a book that had a lot of great content in it, that I look back and realize, I really didn’t do much with it.”

So I’m going back, I’m going back through that book and really trying to figure out, how can I be as intentional as possible? And what’s interesting in that book, one of the things that I’ve most recently learned, and trying to think through, is they do a wholehearted assessment, is what they do, which kind of goes in line with the book. And they said, “If you’ve taken it before, pre-pandemic, take it again.” I’m like, “I don’t really know.” I went ahead and took it, and sure enough, it’s only been about 18 months since I took this original assessment—I’m completely different, in a completely different place on that assessment than I was 18 months ago.

And it goes back to what you talked about Heath, of intentionality. One of the areas where I’m stronger than I’ve ever been before, is in the ability to focus on work, but then turn it off and focus on family. That’s a benefit of the pandemic, really, for us, because you know, we travel all the time. So I’ve not been traveling.

I think it’s impactful for leaders across the board: recognize that you may not be the same leader today than you were pre-pandemic, and that’s okay. But you’ve got to figure out where you’re at now, so that you can figure out how to meet your people where they’re at now, because there’s a really good chance that as we all go back to in-person, or hybrid or remote, or whatever we end up with, it’s not going to be the same.

So that’d be my big takeaway, and also a challenge for everybody listening really is, don’t get me wrong—we’re glad you’re listening to the podcast, and we hope you do, and hope you recommend it to others. But even more importantly than that, Heath, to your point of making a difference—we hope you do something with it. And you don’t use it as part of content, zombie mentality, but use it as an executer mentality and figure out, what did I learn out of the last 28 minutes of this podcast? And how can I implement that to go win the day?

Very good. Well, Jeremy, appreciate the thoughts around that as well. And for me, that’s going to be my takeaway out of this. What do I do with the information that I consumed? Where we are, we’re scheduled to talk with so many what I consider great leaders in and out of our profession, business owners, whatever it may be. What am I going to do with some of those takeaways, to continue my journey as well.

So, I hope everyone got a lot of good takeaways out of our discussion, and we look forward to talking to everyone soon. Have a great day.

Thank you.