Episode 82:

Hello everyone, and welcome to The Upstream Leader Podcast. My name is Jeremy Clopton. We have got a fun episode in store for you today, and when I say “we,” I am joined today by my co-host, Heath Alloway. Heath, great to have you.

You as well, Jeremy. It’s hard to believe we are at the end of the year.

Yeah, somehow we are right on the cusp of 2025, and as we were getting ready to hit record, I was like, is this a recap? Is this a preview? And I think what we settled on is “Yes, yes, it is.” So we’re going to do a little bit of that. We’re going to talk about some of the trends that we have seen over the past 12 months working with firms and individuals in the profession. Talk a little bit about what we anticipate to see in ’25. I don’t know that our crystal ball is any clearer than anyone else’s, but we’re going to offer it up anyway. I would say that for me, the theme that I have seen the most this year, and I think more than any other year that I’ve seen it anyway, is the focus on intentionality. And that’s been a topic that, Heath, I know we’ve talked about on this podcast, we’ve talked about it on other podcasts, but firms seem to be much more proactive in what they’re trying to do, rather than just kind of sitting back and waiting to see what happens. And I would say that one of the areas that perhaps it’s a little surprising—it’s good to see—but it’s been a while since we’ve seen it, is in the area of business development, firms really seem to be set that it’s no longer good enough just to wait for the phone to ring, but they want to be intentional about that, and I know you’ve seen that a lot as well. What are you seeing there, and what are you expecting in the future?

Jeremy, my first takeaway is I think I just added to my Christmas list and I put a crystal ball down, so maybe I can make that picture clearer and really paint that picture for the upcoming year. But, 100%, when you say “intentionality,” in thinking about, I’m going to start with going back, let’s say the last four years. You look at what happened with the pandemic, I think a lot of that time frame, it was just, let’s try to stay afloat, let’s keep up with what we have. In that time, we thought maybe it was 12 months, 18 months turned into a period of maybe closer to three or four years where firms were experiencing good growth, good profitability, and now looking into the future is thinking, gosh, we have limited time, we want to make the right decisions. So there is, it’s like there’s a shift and a desire to be much more intentional with what kind of clients do we want, what kind of projects do we want, and what kind of growth do we want? The kind that’s healthy for our firm. And I hate to say this, Jeremy, but at one point in my career, I thought all growth was good. I thought it was all the same. The more you get, the better off you are. And the further down the road I get, I don’t necessarily buy into that.

Yeah, I’ve fallen into that trap, especially thinking back to building a practice and trying to get something new stood up. It’s easy to fall into that mindset of revenue’s revenue and more of it is better. And that’s as simple as it gets. We don’t need to overcomplicate it. Firms have come around this year, really, and there’s been firms that have made that switch over the years, but there seems to be a bit more of a trend this year where firms do recognize there is a need to grow, but growth doesn’t necessarily mean top line. And more and more firms are starting to, in a way, they’re focusing on, how do we switch the revenue from less profitable, higher stress, not as good revenue—maybe we don’t grow the top line, but we’re going to grow the bottom line, because we’re going to get healthier revenue. We’re going to get more profitable revenue that’s better for our people and better clients for the firm. That really starts with the business development efforts, right?

And Jeremy, I think the best way to describe that, when you think about intentionality, the patterns are already there. Like if you go and ask, they likely know who their best clients are, they likely know, you know, where the profitable growth is coming from. But to think about intentionality, let’s start with the pattern side. One of the examples that I use, I think, you know, a lot of people know I have a seven-year-old son, Max. We’ll play the Nintendo Switch sometimes and I find that he beats me in Mario Kart or FIFA Soccer or whatever it is that we’re playing, because he knows what’s coming next. And I share that so that when you look at opportunities to drive that healthy growth, one of the patterns is the way people find professional service providers or CPA firms is they ask other people. They ask someone they trust. They ask someone they know in their network of, hey, what firm are you using for this? And that is one of the ways there are conversations that are happening about your firm today, whether you know it or not. They are talking to their friends. They’re talking to people in their communities, at chamber meetings or whatever it may be, they’re talking about your firm.

And when you think about growth, to me, I think there are a couple of different key areas: One is cross serving. We know who the clients are. We know that they want the advisory relationship. My guess is that there are clients in most firms today that you’re not taking every service that you could be. There are discussions that are not happening today. Your success rates with those kinds of firms are going to be closer to 50, 60, 70 percent than instead of responding to a blind RFP that maybe you never even had a chance to win. I see that as one. If we know our clients are talking about us to other people, my other challenge from intentional growth is, when was the last time you asked them, like, if we did such a good job and you got great value, would you be willing to introduce us to someone else in your network? And I get that that can be a little uncomfortable, but when you think about your intentionality, those are two huge opportunities. Many firms will be with their clients over the next several months, so those are just two ideas to start with on how to be intentional about developing and growing in the way that we want to.

It is. And I think those two action items are easy to implement. I’m going to add one to it that even goes back a little bit further to the kind of zooming outside of things, and that is, do you know the next three to five clients that you want to go land? I’ve been, I don’t know if surprised is the right word—it’s been eye opening, is maybe a better way to put it—at how few, even partners in our profession, don’t have that list. And they would say, well, that’s really hard to come up with. But to your point on playing the Nintendo Switch and knowing what’s coming up, it’s not that you necessarily know exactly what’s coming, but you’ve learned how to anticipate what’s coming. And the same is true: I may not know exactly which client I’m going to land next, but if I’ve got a list that I’m working, I can anticipate, it’s probably going to be one of those, and the ones that I want, right? It changes your ability to be successful and to be proactive.

Even if you’re listening to this and you’re sitting here thinking, well, I’m not in public accounting, maybe I’m in some other area, though I think most of you are in public accounting, this applies whether you’re a partner, this applies to staff, anybody is, what’s the next thing that you want to go get? That’s truly the intentional side of this. So the next client, the next referral, next introduction, next person in your network, all of that, if you just take a few minutes to step back and say, okay, in an ideal world, who would I want to go work with? It puts you in such a much more anticipatory mindset to be able to go out and make that happen. Otherwise, you’re hoping—again, not a strategy, we all, we say that, right?—you’re just hoping that you’re going to get a good client. And in my experience, you get better clients when you go get clients rather than them coming to you.

You find what you look for, Jeremy. It’s like buying a new car, you’re looking at a new car, all of a sudden when you’re driving around town, you start to see that same vehicle. When you’re looking for it, you tend to find it more.

Exactly. A hundred percent. Well, Jeremy, let me ask you this. You talk about, you know, setting expectations and goal setting and, you know, the four cornerstones. And we know growth is so critical. It’s the fuel in the gas tank that can help drive our vision, drive our mission. How do we handle the expectations and the goals if you have, I’ll say, a newish partner, or maybe it’s a manager and they have high aspirations, but they say, “I did not get into this profession to be a business developer. I don’t enjoy it, I don’t like it, I’m not good at it.” How do we start to overcome that in those scenarios? I know it’s something that we see, or I see, more often than not, it’s not something that most people got into the profession to do.

Yeah, I don’t know a lot of accountants that got into accounting because they wanted to go out and sell stuff. That isn’t exactly how that normally tracks. You didn’t go to the college advisor and say, you know, I’m really into talking to people and selling things and want to be an extrovert. And they said, we’ll go be an accountant. Typically, hey, I like to analyze numbers. I like to, you know, get in and understand the business side of it.

What I would encourage is figure out what you’re good at and leverage that to develop business. And there’s a managing partner and I won’t name him, but I told him the other day that I share this story often and I love his approach to business development. And he’s very simple about it. He goes, Jeremy, I’m not going to play golf. I don’t enjoy it, I have no desire to be on a golf course, and I’m not going to go to a bunch of fancy dinners because I don’t think that’s that great either. That’s not how I want to spend my time. He goes, I’m going to figure out how I can go build relationships that are meaningful for them and for me, where they’re going to benefit both of us. And I think that’s brilliant because he’s essentially said, look, I know what the stereotypical business development approach is, and I couldn’t care less. I’m not taking that approach, I don’t want to take that approach, and guess what? I don’t have to.

So what I would encourage is figure out what works well for you, and then look for opportunities to get in that situation. I hate, always hated chamber mixers, right? The whole go look for somebody that’s asking for an accountant’s business card type of, never enjoyed that from a business development standpoint. I know some people thrive in that environment. I’m not one of them. But if I can be somewhere where individuals that I want to talk to are going to be, and it’s more of a low pressure, maybe it’s at a conference, maybe it’s just somewhere else, where it’s a different environment, I can feel really comfortable just going up and striking up a conversation. So you find those situations, and you look to create those opportunities that are going to play to your strengths and where you think you’re going to be successful.

I had a team member that always told me, and this was when I was with a firm, “I’m not great at business development.” He didn’t realize he was arguably one of the best business developers, but it wasn’t the traditional definition. For him, it was get him in front of a client or a prospect with a problem, and he will show them how to solve it. And they will be wanting to pay you by the time that meeting is over because he just had that ability to connect and solve a problem and empower somebody. It wasn’t, okay, well you go learn how to do all this other stuff. It was, let’s get you in more of those situations because it works. And I think we overlook that a lot. We don’t think about, okay, well, how could I do it? We look at it and we say, well, business development is this, so therefore, figure out how to get comfortable doing that. And then a lot of people, like you said, they self-select out instead of figuring out what works for them.

With that mindset and that approach, Jeremy, in a lot of ways, I see it as, wouldn’t it be a shame or wouldn’t it be a crime to, if you know you can help someone or you could help a client, shouldn’t we be talking to them about it? It’s like going to the doctor. What if you went to go talk to a doctor and they had something that could help you, but they didn’t share with you? And I think it’s almost a responsibility as someone in our profession, if we know we could help a nonprofit or a local bank or a manufacturer, why would we not want to have that kind of conversation with them? That’s great. I love the approach and it’s more passionate, and you care about what you’re doing, so.

It is. And what it does is, there’s a concept here that, and I was sharing this with somebody earlier today in a conversation is so much of the way that we approach things is through the lens of compliance, and it’s doing the things that we know we’re supposed to do because we know we’re supposed to do them, rather than through the lens of compassion. I don’t actually know anybody that has ever called business development compassionate. However, if you genuinely care about an individual or a company’s success, you’re going to be a pretty darn good business developer because they’re going to know that you care about their success more than just your bottom line. You’re truly there to help them solve a problem. We don’t view it that way. We look at it as, okay, well, did I spend enough hours at conferences or at marketing events or at chamber or doing whatever it is that everybody else is supposed to be doing?

There’s a question that I’ve used all of 2024 that puts you in this mindset. So that individual is thinking, I didn’t get into this for business development. What would have to be true for you to feel comfortable doing business development? And if you really step back and answer that, now you use the other theme that we just talked about, Heath, which is intentionality, and you say, great, I’m going to go create that. I know what it would take for me to be comfortable and for me to be successful. Now I’m going to go create that opportunity. And everybody can do that. I don’t care if you’re a partner or a staff accountant. You could be, second day on the job. You still have the opportunity to be a business developer.

I think that approach could actually be fun. It’s rewarding whenever you’re doing something where you have someone that is really struggling, you’re able to help them. To me, that’s a lot of fun. And I don’t think in my, I guess now roughly 18, approaching 19 years in the profession, I don’t think I’ve ever seen a firm or ever been part of a firm where people walk out from a meeting and they’re like, high-fiving, “We sure pulled one over on them and sold them on something they didn’t need!” I just have never seen that. So I like what you’re talking about a lot better and I do think as a profession, we’re much better positioned than what we give ourselves credit for.

Well, Jeremy, kind of moving from growth, you talked a lot about the intentionality side, kind of as you kicked us off. What else are you seeing from firms to make that shift from being less reactive and more proactive with their efforts as we move forward as a profession?

There’s a couple areas. One is again, the idea of, I don’t know that I want to go full on with succession planning, but developing the next generation of talent. Some are doing it for succession planning because they’ve realized, oh crap, we don’t have a succession plan and we have people that want to retire, well, they can’t. So you’re seeing it some from that, but I’m seeing it more in firms that they do have a good bench, right? They do have a path to sustainability and a path to longevity. But they’re realizing that if they’re ever going to get the type of growth that we just talked about from a business development standpoint that’s healthy, they’ve got to spend more time developing their people, not just saying, well, they should figure it out on their own. That’s another area where I’ve seen some intentionality is a lot of firms have finally come around to that idea that yes, your people have to care enough about their careers to take ownership and put in the work, but we have to care enough about their careers to provide them opportunities and help them then develop and refine the application of that. So I would say that another area has been people development.

And again, it goes back to that idea that for the last few years, there’s been a bit of a fear around people of, if we ask too much, if we challenge them, if we push them, if we ask them to go take a class to get better or provide them feedback that they need to improve, that they might just leave. And so again, everything’s been done really just to kind of maintain and not rock the boat at all. And I’m not saying that caring about developing people is rocking the boat, but in a way it is. And firms have really started to realize that if they’re going to keep the right people, and develop them the way that they need to, they’ve got to be much more intentional about it. They’ve got to be much more proactive with feedback, with training programs, with experiences and shadowing and mentoring and coaching, and not just saying, well, they should get there on their own here, in about, let’s call it seven or eight years, that’ll be good enough. And instead, we’ve got to figure out how do we really take a proactive approach to that? That’s something that I’ve seen. I know you’ve worked with some firms this year on coaching. I would imagine you’ve seen a similar approach.

Yeah, I mean, you hit one big aspect of it. And then I’ve actually, I’m going to go back to a question for you on something else you said, but one big aspect of it, Jeremy, you mentioned the compassion side and caring about your people. When you look at a successful coach, that’s the foundation of being a successful coach—if your people truly know that you care about their future and you have their best interest at heart. If they don’t see that, the likelihood of engagement levels probably goes down a little bit, the possibility of them leaving a firm probably goes up a little bit, if they don’t truly feel that you have their best interest and you are committed to developing them. We’ll come back to that in a second.

But I wanted to go back and ask you, you talked about the people development, the development of skills, and maybe, in a way, the experience that they have within a firm. You go back and you look at the last three or four years post-COVID, and I think the term was “Great Resignation,” whatever you want to frame it, and some of the actions and the things that firms took at that time, compensation or bonuses to try to retain, and that may have been maybe a short-term band-aid fix, but when you compare the compensation side and then you said the development, developing skills and seeing a future, how much do you think those intrinsic motivators impact engagement and retention, maybe even more so than compensation or bonuses? What are your thoughts on that?

Well, if you look at the Gallup organization, which is probably one of the world’s best in studying engagement and retention, I don’t think, I don’t remember all 12 questions in their Q12 methodology. I don’t know that any of them say, “How much money do you get paid?” None of their measures of engagement are tied to money. Maybe one, but I don’t actually think—I mean, it’s all about relationships. It’s all about people. One of the number one, I think last year it was the number one component of retention was professional development. Now that’s industry agnostic. Arguably, we should be one of the best industries in the world at professional development. Again, we call it compliance—it’s called CPE rather than looking at it as learning opportunities—but the intrinsic motivators of autonomy, mastery, and purpose have been proven through numerous studies, that’s the driver of engagement and retention.

Compensation, it’s going to make you feel good until it wears off. It’s a short-term band-aid fix, assuming that the band-aid disintegrates over time because it just kind of goes away. It fades. There’s a firm in the upper Midwest that their managing partner said, “Well, we want to pay our people enough to where money’s not the issue. Not so much that it’s putting the business under, by any stretch of the imagination, but pay them enough to where they’re comfortable and that, you know, an extra grand from somebody else isn’t going to be the deterrent. Pay them enough to where money’s not the issue and then create a great experience.” Compensation, bonuses, do they matter? Absolutely. I mean, if I were to sit here and say, “Oh, those don’t matter at all,” that’s BS. We all know.

We might edit that part out.

Yeah. Compensation, bonuses, titles, yes, they do matter, but they don’t have to be the end-all, be-all. And if you’re truly looking for long-term engagement, long-term retention, it’s autonomy, mastery, and purpose. You can only stay in a job that you are tolerating because of the pay for so long before it becomes not worth it. We focus a lot on, you know, how are we paying people? I mean, a lot of the questions that you hear, a lot of the questions that I hear, what are people doing for raises? What about comp increases? Is it once a year? Is it twice a year? And when you look at the best of the best firms that are out there, those aren’t the questions they’re asking. They’re making sure that they’re paying their people enough, but then they’re saying, “Okay, what do we got to do to make the experience exceptional,” to where they want to be here, rather than just, “Well, we pay them enough, they don’t want to leave.”

Let’s say you have a group of partners, maybe managing partners. And what you just described sounds like a pretty big time and energy investment, coaching, teaching, training, developing new skills, all the things, and if we know that we’re in a culture of busy and finding time, if the answer is we kind of, “We just have so much going on right now, can’t find the time to do it,” or “We struggle to find the time to do it,” what advice would you have for them?

Well, unfortunately, the reality is if you don’t have the time to do it, you won’t have a firm in the future because you’re essentially swapping out short-term busyness for long-term success. Most partners, when I talk with them and I ask them, if you look back early in your career, was there an individual that gave you the time, energy, and effort to make you as successful as you are today? Or did you do it all on your own? Right? Were you just so good, it didn’t take a mentor, or a coach, or an advisor, or anything, you just showed up day one and you were amazing, and that’s how you got to partner? Or, who was it that helped get you there? Every partner I know, and every partner that I’ve asked can name the person. I mean, instantly, they’re like, it was this person.

So we know that it works. And I’m not one to go back to the way that it was back in the day or when we were their age, but that’s one thing that we need to bring back, and that’s the time, attention, and care that partners gave back in the day. Partners today want to. So if anybody is listening and thinking this is an indictment on partners today, it’s not. I know that partners want to do that. We’ve got to figure out what D-level client work can you trade off for investing in your high performers because those high performers are going to lead to far more success for the firm than any D-level client is.

Jeremy, I think something to point out too, you mentioned someone did that for them. I bet if we went to their coach or their mentor or that person that invested time, I bet if you went and asked them, like, who did they make an impact on or who did they enjoy working with? I bet some of their most meaningful moments are those that they coached or they helped on their career path.

Exactly.

Maybe even more so than some of the other aspects of the profession that are great. But my guess is they would look back and say, those were some of the most meaningful parts of that career journey. So I think that paints the picture of from the beginning to the end of retirement, those can be some of the most impactful opportunities that we have, and it takes intentionality, it takes time.

It does. And it takes compassion. I mean, right now we focus on our people when HR says we have to focus on our people. When the HR department says, alright, time to do the evaluation and all of that. When we’re busy, we fall into the mindset of compliance. “I do it because I’m told to.” Partners that pour into people, that pour into their high performers, they do it because they care. They genuinely want to see, they find the time. It may be billable time, I don’t even care how it gets coded, bring them into a project. Here’s the thing, unless you are paying that high performer overtime, there is no additional cost to investing in them. There is no additional cost to mentoring them. Your expenses did not go up, your bottom line stays the same.

I realize realization on that project might take a hit. It didn’t actually cost you anything from a financial standpoint. And in fact, if you want to get kind of, you know, I don’t know if it’s cold to think about it this way or crass perhaps, but at the end of the day, people are—I forget which book it was that I read this in—but people have the highest potential ROI in your company. You invest in your people, you will see returns far greater than investing in anything else, technology included.

Sure: People, clients, then growth.

Yes, exactly.

A hundred percent. Too often the people and clients piece gets switched around in that batting order, and sometimes, and I don’t think it’s necessarily intentional, maybe sometimes it is, but sometimes when we put clients before people, it sends the wrong message.

It does, and then we don’t have people to serve those clients. It creates a problem.

Yes, that’s a vicious, vicious cycle. One of the things you talked about at Headwaters, and I know we’ve both probably seen some of this throughout the year, is one, not only that, I mean gosh, the private equity involvement, I know everyone’s heard plenty about that, or the M&A activity. What do you see as far as the last year, maybe even looking into the future, with firms making that transition to run their firm more like a business, and what does that look like in the future? What opportunities are we seeing there?

Yeah, I really do think that that’s one of the biggest opportunities going into ’25, and more and more firms, they recognize that. Again, I don’t know a lot of partners that don’t see it. It’s just figuring out how to do it. And I think that’s one of the big opportunities. To be successful in that, the couple of things that partners are having to overcome first are figuring out how to separate governance from operations and understanding that, you know, the partnership side of the firm, the decision-making side of the firm really involves all partners when it’s governance-related, but that’s a really small subset, and then everything else is operational.

The sooner that firms, partners in particular, can separate the two, separating the fact that yes, you’re a shareholder, yes, you’re an owner, but that doesn’t mean that you can play the “I’m a partner” card in the operations. Instead, it’s the “I get to vote because I’m a partner” card in the governance. That’s arguably the biggest mindset shift that has to happen. And that’s a really hard mindset shift for many because the way that we’ve, you know, you talk about getting to partner, now you get a say in everything. Well, for starters, not everybody wants to have a say. We don’t actually care as much about that say as we think we do because so often they get into the room and then somebody asks a question like, well, I don’t know, I don’t really care. It’s like, wait a second, all you wanted was a say and now you don’t have a voice.

So if we really step back, it’s a huge benefit if you can separate those two. The reason that I think that creates an opportunity, so that’s the challenge of it, is that separation. What I don’t believe that a lot of partners realize is that when you separate governance from operations and you truly start to run the firm like a business, it actually provides you more autonomy as a partner to do what you’re great at, because it’s pulling away so much of the operational burden from the partner group and is saying, okay, if we were a business, how would we tackle this? Which means we’re probably going to have somebody focused on that. We’re going to have somebody that runs operations or runs the financials. And that shift is incredibly important.

That however, gives rise to, again, one of the biggest changes that will have to happen. The other perhaps really big change is partners have got to get better at holding each other and themselves accountable to partner standards. And that’s something that I know a lot of firms are probably sick of talking to me about that, frankly, over the past few months, because there are a bunch of them that I’ve been talking with and working with, and we’ve been going through this and how do you evaluate partners and how do you separate expectations from goals, and really starting to hold partners accountable for what they are expected to do. Because we have these non-negotiable standards, these partner standards that they all agree, yes, these are critical, we should all do that. Then at the end of the year, it’s like, great. How many of you did those? I mean, you know, we gave it a try, but our people just aren’t accountable. This may be a hot take that people won’t care for, but I’ve told a lot of firms this point blank: I’ve kind of lost patience with partners wanting to complain about their team not being accountable if they aren’t first being accountable themselves.

That’s fair.

And that’s the other shift though, right, from running it like a business is now you are, as a partner in a business model, yeah, you’re a shareholder, but from an operational standpoint, you are the highest of high-level employees, which means you have got to set the model and set the standard for accountability if you ever want your team to be accountable. And that is a huge opportunity going forward. Is it easy? Absolutely not. Is it absolutely critical? It is. And the more that partners can set the model for accountability, I genuinely believe—and I’ve seen it firsthand with experience—the more accountable their teams are, and overall, the better the firm is going to perform because when the partners are accountable, it’s amazing what you can get done.

And accountability shouldn’t be a bad thing, Jeremy. If you think about it, if we know what success looks like and we agree that that’s what it’s going to take to get there, we’re going on that journey together, and I’m going to help you, you’re going to help me, and that’s really accountability, is when we say, here’s where we’re going, now let’s go on this journey together.

One question, hearing you talk when you said from separating the operational side, and then partners don’t have to focus as much on that, when you say that, I assume they’re firm leadership, maybe carrying less client work, less client load, maybe even hiring additional resources, whether that’s HR or learning and development or marketing, whatever it may be. Do you run into the hurdle of the partner group seeing this as a cost and not an investment for the future of the firm, And how have firms navigated that? I have to think that that’s come up potentially from time to time.

Absolutely. Lots, lots of the time. We are really good as a profession at minimizing cost centers. Unfortunately, that doesn’t exactly mean that we can run the business super efficiently because in doing that, we then keep the operational burdens or administrative burdens on the partners because we don’t want to hire that CFO or that COO to handle that because we’re like, well, but they’re not generating profit. They’re not generating revenue. How is that a good thing?

We inherently know that burdening the partner group with administrative tasks is not the best use of the partner group. So, really, the way to overcome it that has worked best is to really model out the business side of it and to say, look, if we spend X number of dollars on a controller or a firm administrator, that’s going to free up this many hours of partner time. What revenue could you go generate with those hours? And no, before anybody reacts and says, “Jeremy just said ‘billable hours’,” I did not say go bill those hours. What can you generate? Value, worth, base, however you, I don’t care how you do it. But the question is, what could partners then go create value to the firm with that time, if they weren’t taking care of these administrative things, it would arguably be better served having somebody else take care of them?

When you take it from a business standpoint, we don’t go off feelings, we now go from, okay, well, let’s look at this, the cost of a firm administrator, and these are not market rates, it’s hypothetical, is $150,000, and that’s going to free up however many hundreds of partner hours? And we could go generate another half a million dollars with that? I don’t know very many partner groups that are going to look at that and say, I don’t know that I want to spend $150,000 to make $500,000. Every partner group will look at that and say, “Well, that does make a lot of sense, doesn’t it? And I wouldn’t have to do all that stuff I don’t want to do.” So yeah, we can do that. But it truly is to make that shift, Heath, you’ve got to, you’ve got to model it out like you would a business. And we know how to do that because we do it for our clients every single day.

It’s human nature, though, sometimes when it’s our own costs tied to it, or if that’s the mindset.

It is, and here’s the harder part, perhaps: For a lot of partners, and again, no judgment, I would be the same way probably initially. I get it. The other side of it is you’re essentially saying, “hold on a second, I’m gonna spend $150,000,” again, hypothetical dollars, “to go hire someone who is not a partner, to tell me what to do. I don’t know that I’m on board with that.” In fact, I’ve had partners tell me, point blank, “No, I am not bringing somebody in at the executive level that’s not a partner, that’s going to tell me what to do. I am not paying their salary to hold me accountable. I’m a partner. I should get to do”—You know what? As I always say, it’s your business. You can run it however you want. My philosophy is that’s not very healthy.

There’s ego involved. We all have ego. I don’t know anybody that gets to the ranks of partner in our profession that doesn’t have at least some ego somewhere. The question is, can you keep it in check enough to participate in running the business successfully? To say that, well, we’ve got to have partners that have zero ego—you know, as many partners as I do. Probably everybody has got a little bit. I mean, high performers are going to have a touch of ego is part of it. So we’ve got to figure out not just how do we not view them as a cost center, but how do partners get comfortable being held accountable by somebody that’s not a partner? That’s not easy.

Well, I know we’re going to wrap up here in just a second. I want to go back. You’d asked me about coaching and some of the work there. One thing, just from an intentionality standpoint, that I think we have a lot of opportunity with going into 2025—a lot of firms, actually, the majority of firms that I’ve worked with, they don’t really spend a lot of time teaching those that are being coached on what their role in the relationship is. So investing more time with the coachees on what is their role? And if I could give any advice, you know, if we have younger people that are just starting out, that are just now being coached, they have more control than what they probably even know. And so becoming coachable will have a significant impact on them.

So if you’re a coach and you’re struggling with getting your coachee and making progress, start putting more ownership on them—have them set the meetings, have them send you the agenda or what they would like to discuss 24 or 48 hours in advance, have them use a career map and put some thought into where do they want to be in three or four or five years. Maybe they don’t know exactly, but at least start having those discussions to put more accountability on them and let them get in the driver’s seat and then you can guide. Not only that, it gives you the foundation for the open feedback. If someone says, that’s where I want to be. Now, let me help you, now, let me share with you, here are the lessons learned and how we’re going to get there. So that’s a big shift and something that I’ve been trying to really drive home with firms that are implementing a coaching program.

Yeah, and I’ll throw out there, if anybody’s listening to this episode and you would like a career mapping template, you are welcome to reach out to either of us on LinkedIn or shoot us an email—our email addresses are on the website. You are welcome to reach out and we’re happy to send over a template that we recommend folks use for career mapping. And, you know, going with that, it truly is all about intentionality. And again, I’m going to give you my favorite question in 2024, “What would have to be true?” If you’re the coach and you’re not happy with how the relationship is going with the individual you’re coaching, they’re not stepping up, they’re not doing enough, ask yourself, “Okay, well, what would have to be true for this to be working well?”

When you do that, what it does is it allows you to skip over the “How do I get there?” Because that’s sometimes the hard part, as we get so fixated on, well, how do I fix it, rather than taking the time to be really intentional and say, well, what would working actually look like? And once you can skip forward and see what that future is, now you can step back and say, okay, well, at least now I know where I need to get to, what steps will get me there? It’s way easier to do that. And Heath, I’m with you. Very first thing, you’re going to run these meetings now. If I’m coaching you, I’m not running the meetings, because—and you know my number one rule when it comes to coaching—I will not care more about your career than you do. And I encourage coaches, adopt that, all the time. If they’re not putting forth the effort, it’s not your responsibility to care on their behalf. They have to care. And you can support and you can nurture that, but if you care more than they do, I can guarantee you it won’t work. So if that’s where you’re at, okay, well, what would have to be true to change this scenario? Well, they would need to take more of an ownership. They would need to show that they care. They would need to come up with the ideas. Great. Let’s go tell them that. And it makes it so much more proactive.

If you care more than they do, and you can, you can, but it leads to frustrations.

Yeah. It’s easy to. Well, as we’re concluding here, Heath, what are your thoughts coming up on 2025? Any advice, insights, recommendations, thoughts as to what you expect to see in the coming year?

It’s changed about four times throughout our discussion. So I’ve landed on, and this is the one that’s in my mind right at the moment: I’ll say it’s more of a, maybe an exercise to bring intentionality to what you do. And a lot of what I’ve talked about with that culture of optimism and the belief, you know, that we do have a great future and really trying to attract people to the profession. And what we think, value, and believe inside is eventually our words and our actions. And one thing, it’s going to sound funny, but I’ve done it the past several years. I did it, you know, when I had a team, I’ve worked with other firms doing this, is one of the ideas or exercises out of Jon Gordon’s book on The Power of Positive Leadership is the one-word exercise—to bring intentionality, not some big goal, but even if you pick one word that you are going to focus on throughout the year. That could be “purpose,” maybe it’s “growth,” maybe the word is “intentionality.” What we’ve talked about, print it off, put it somewhere in front of you, share it with your coach, share it with a mentor. From time to time, talk about how have you used that word, how have you focused on it, how have you utilized it with clients or whatever it may be, it brings a lot of intentionality to what you do in your thought process. So, I just thought I would share that as an idea to be intentional as we go into 2025.

I like that, Heath, thank you.

What about you?

Yeah, so for me, we got this busyness culture and we talk about that a lot. The topic that I’m kind of doing a deep dive research-wise right now on is quitting. Which is kind of funny because I know that you’re a huge fan of grit and perseverance and we talk about that a lot and here I’m talking about, well how do we quit? It was really spurred along by the book Quit by Annie Duke is kind of what got me kind of going down this path, and there’s several other books that I’ve got stacked up here to continue the research on and I’m planning to do a keynote at Headwaters on it, but rather than looking at what else should we be doing, what should we be adding to find more success? I’m really focusing in on 2025 is, okay, what are we doing that’s no longer serving us that we should actually quit in order to be even more successful? And taking that addition by subtraction approach to things in the new year.

So I don’t know that that’s an action item necessarily for folks. I do like the intentionality and there’s obviously some intentionality with figuring out what to quit, but it seems like we keep adding things. And look, I love the new app, the next shiny object and the new book and the new content and the new, more, more, more, more, more, right? It’s so easy to do. Really taking a step back and saying, alright, how do we create more focus through less, is my view for 2025.

For the profession, I really expect to see some more change. I believe I’ve heard rumor we’re coming up close on seeing the first flip in the private equity space to see kind of what the next iteration of that brings. I would expect that we’re going to see more private equity, more M&A, more fiercely independent firms. That’s going to continue. And what’s interesting is in all of those, it requires you to be intentional. You can’t do any of that by accident or through the strategy of hope. You’ve got to be deliberate with it. So I think it’ll be a fun 2025. I don’t know about you, but I’m looking forward to seeing what happens in the profession. It’s a great profession. Got a lot of great firms, so I’m looking forward to it.

Yeah, 100 percent, Jeremy. Well, it was good to connect. Appreciate the time. Thank you for everyone that is listening in and has been part of the podcast journey. It’s been a fun one. So thank you for that. And we look forward to 2025.

That’s right. Thank you, everybody. Happy holidays. We’ll talk to you again soon.