Today, our guest is John Spence. I’m very excited to have John here today. John is widely recognized as one of the top business and leadership development experts in the world, and you’re going to understand that as I kind of go through what I’m going to make this a little longer intro than I normally do, but John’s been named on a lot of top lists, which, I’m a big fan of lists. And so at 26 years old, he was actually named, which is what—26, was that like yesterday, John?

Like 32 years ago.

Okay. Well, at 26, he was named one of America’s up and coming young business leaders. He’s been recognized in the top 100 Business thought leaders in America, one of the top 100 Small Business influencers in America, one of the top 50 small business experts in America—and I’m not done—one of the top 500 leadership development experts of the world; the American Management Association named him one of America’s top 50 leaders to watch he’s also been recognized by the highly prestigious Thinker’s 50, as one of the top eight—pretty high up there—in the world, for their Distinguished Achievement Award. I can go on and on about companies you’ve worked with, the books he’s written, but I think we’ll cut it off there. John, welcome to The Unique CPA.

Thank you, Randy. It’s good to be here, sir.

Yeah, well, it’s you and I met for the first time just a week ago. And I feel like I’ve known you forever. So I think I understand how you do well, in this business—you’re very easy to get to know like and know.

Oh well that’s kind of you. Thank you.

Yeah!

One thing before we get going that I’m just gonna put in here because I read this and this is your book is I think, the title of this too. But your motto, or one of the things you’ve said, or you’ve written on your website, or in your bio, is “Making the very complex awesomely simple.” And I love that because I think I try to live that way because I do lots of webinars on tax topics, which can be very boring and complex. And I think I try to make them as simple as possible. So how did you come up with that, and give us a little bit of—I guess it’s self explanatory, but what that all means to you? 

Well, it’s something that I sort I didn’t really realize I did until I started reading about some of these things. And there, I’ll give you an example, I read a great book called The Cambridge Handbook of Expertise and Expert Performance, a 970 page book written by experts about how to become an expert. I’ll save you the reading. It basically said there’s four P’s. And I think this applies—it applies across in your business, in, arts, in whatever it might be.

The first P is passion. I think it just stands to reason, if you don’t love what you do, you don’t really enjoy it, it would be hard to become world class at it. The next one is patience. And some of the folks listening might have read Malcolm Gladwell’s book Outliers and some of the research there. So it’s about 10 years, 10,000 hours to move into that realm of the third P, which is practice. But it’s a special kind of practice—it’s called deliberate practice, and deliberate practices. I’ve got a coach or mentor or colleague, or I’m going to training, but every time I practice, I’m practicing a little bit harder, I’m always getting a little bit better. I’m not resting at one level. Which leads to the fourth and final p and this gets to your answer is pattern recognition. That when you become really, really good at something—you’ve spent 10, 20 years at it, you’ve been constantly practicing, that all the sudden you see it in a way that other people don’t see it. This is how, you know a great musician can look at a piece of sheet music and hear the music in their head, or a chess grandmaster can look at the board and tell you here’s 10 moves this way, 15 moves that way, because they don’t see the board and pieces—they see a clear pattern.

 Well, I’ve built my entire career out of looking for patterns. I look for patterns in business, I look for patterns in executive coaching. And when I see—and I also study, I read about 100 to 120 business books a year. I combine all that, and then I just say “Alright, what’s the thread that runs through all of it?” What’s the things I see over and over and over again. And that redundancy gives me a pattern, so I can take extremely complex things and find the pattern, and then just teach the pattern.

Nice. And is that just a way your brain works? Or, I mean, this is just—did you teach yourself this or it’s just like, “Hey, this is how I know I can do things and let’s go with it”?

Well, a little bit of each. 

Yeah, I figured.

Apparently this is a skill I’ve had. My first mentor when I was working at the Rockefeller Foundation, Charlie Owen would walk in my office every Monday and hand me a book, business book, and he’d say, “I’ll see on Friday for lunch, we’re gonna go through the book.” And then on Fridays, I’d have to sit down with a lunch and eat, he’d just pummel me. But the thing that changed, not just what did you learn, but here’s what he said, “What are the three things you will apply?” So he was the first one to teach me to take ideas and turn them into action. And then he would say, “Okay, I’m gonna write this down, you’ll now be held responsible for doing that in your job.”

And I think that practice of looking for things to apply—I’m going to read a 300 page book, but I have to write three action steps, really honed my skills at looking for core patterns of essential information.

Wow, that’s pretty cool. That’s, uh, that this wasn’t even where we’re gonna go. And you already got me you already got me going. So the one thing you mentioned, when we’re talking about that is the books you read—100, 120 a year? 

Yeah. 

You and I, when we talked last week, I confessed: I do not read any business books. And I know I should. Is there any advice you can give me to… Well, I’m 60 now. Maybe I shouldn’t, maybe I’m done. 

Don’t give up on yourself! There’s still hope! Come on man! Don’t give up!

I’ll do my best. Is there any advice you can give me to get started? I mean, I read books all the time. I just don’t read business books. And maybe that’s a deficit I have in my career. I don’t know.

Ah, well, you know, like, let me give you some statistics—real quick, “sta-twist-icks.” The average college graduate reads about a half a business book a year. 

Okay.

So you’re not too far off, you’re at zero, you could pick it up a little bit. But get this, if you were to read one book, or the equivalent thereof, right? It doesn’t have to be reading, it can be listening to an audiobook or a podcast, but something—taking in the equivalent of one business book per month, every other month, six books a year, you’re in the top 1% of the United States of America for self learning. If you did one a month, 12 books a year, you’re in the top 1% on the face of the Earth for personal development and business skills. 

So my advice is the bar is not very high, you can basically trip over that one. Number two, there’s more information available for free ever in the history of humankind, so it isn’t going to cost you that much. And number three is just discipline. I block an hour a day, and don’t forget, this is my job. You know, my job is to learn stuff. But if you blocked 15 minutes a day to read or listen to a podcast—that’s about an hour and a half a week, about seven hours a month. If you consistently did that, you’d be in the top 10% in America for new learning. 

And I learned it really, really early in my career at the Foundation, because no one else was really reading, and I was reading and studying and learning, and everybody else got a $1,000 raise and I got a $3,000. Then they got a $3,000, I got a $5,000 then they got a $5,000 and I became the CEO! The correlation to me was not direct, but for every 100 books I read, things seem to be getting a little bit better.

And again, it doesn’t mean that I have a high IQ per se, it just means I have access to more information. It doesn’t make me a genius. It just means I have other people’s ideas to pull from.

 

So yeah, I think maybe that’s why I don’t read books because I do have a very high IQ. Alright, so I already think I know it all maybe that’s a problem. And I’m sure we can analyze me then with that knowledge!

You just turned 60 this week, I believe. I turned 58 About a month ago and I was thinking about it. I feel like I’m learning more now than I ever have in my entire life.

Yeah, I agree.

And I’m just having a blast. But here’s my phrase: I now realize I know almost nothing about almost nothing and nothing about almost everything.

Wait, I’m not sure I caught that. Maybe my IQ’s not that high! Say that again?

I know almost nothing about almost nothing—

Okay—

and almost nothing about almost everything. I’ve got a very small area of expertise that I know a little bit about and then I know nothing about a whole bunch of stuff.

Yeah, I can relate with that. I know a decent amount about certain tax codes and I can talk about that quite well but there are a lot of things I agree completely that I know nothing about. So Alright, I’m gonna take myself down a couple of notches and make sure everybody realizes I was kidding with that. I do have an ego, but it’s not that large. 

Alright, so this is great. Let’s go into—so obviously, this is The Unique CPA. What we like to do is give CPAs in general some knowledge that they can help in their career, their business, their you know, personal life, whatever it is. Is there a path you’d like to go down where we think we can help CPAs?

Yeah!

You know, obviously, it’s a stressful business. I’m sure every business is, but it’s just ended the tax season, although I’m not sure when this will be released, but what could you help CPAs with to be better at what they’re doing or wherever you want to go with this?

I’ve got two areas that I’d like to share with you. 

Yep. 

The first is, all those 30 years now reading, studying, learning, working with companies all over the world, part of what I found is a pattern of what great businesses focus on.

Okay.

And it’s four key things, and I’m sure CPAs will appreciate that I put it into a formula. And I’m sure someone will look at the formula and realize it’s not done correctly. But anyways, it’s in brackets. We’ll actually do the formula thing—in brackets: [Talent + Culture + Extreme Client Focus] × Disciplined Execution. So let me go through that. 

Yeah.

I think these are four things that are fundamental to running a great company, whether you’re a solopreneur, or you’re running Apple. Number one is, the quality of your business is directly tied to the quality of people you can get, grow, and keep on your team. And even if you’re a solopreneur, that’s you, and that’s any outsourcers or vendors you use. But your company will never be more successful than the people you have in it, period. So talent—that means talent acquisition, talent development, and talent retention should be a major strategy. And if you have a larger firm, and you know, especially in your industry, you’re not making anything that’s—I can’t go out and take a picture next to my staff. It’s not a lumpy object. If you’re selling intellectual prowess, I need really smart people on my team. 

Number two is culture. And it’s a balance of two things: you have to have a culture of engagement, where people like what they do, they enjoy their job, they like the people they work with, they take pride in the organization, they work for the sort of what I would call the happy part of the engagement. Then the other side of the culture is a culture of accountability, where people actually deliver the work that they need to deliver on time and done exceedingly well. 

Then the next one is extreme client focus. And I will tell you, as I’ve worked with thousands of companies, 95% of organizations are pathetic at truly listening to their customer / client, and understanding the real needs, wants, worries, desires. And these are the people that pay all the bills, so I think—I’ve got a phrase, whoever owns the voice of the customer owns the marketplace. 

And then the last thing is, this is all multiplied by disciplined execution. Other than communications issues, the single largest issue I see every client company I work with is not being able to actually execute on the strategies and plans that they’ve developed.

Alright.

So let me stop for a minute. That is what I call my formula for business excellence. And that’s 30 years in one equation.

Oh, so this is very simple then. We can do that 30 years, you just gave it to us right in three minutes? That’s awesome. So now we just go put it into play.

It’s Awesomely Simple!

Nice!

I hate plugging my plug. I’m not plugging that, I just had to go for that one.

Well, I’m going to read Awesomely Simple and this is on record, I was gonna say on tape— it’s not tape, whatever this is anymore. It’s digital. I am going to read Awesomely Simple. Tell me that again—talent, plus culture, plus extreme client focus…

…multiplied by disciplined execution.

Multiplied. Got it. I’m going to put an × for times. And say that again?

Talent, plus culture, plus extreme client focus, multiplied by disciplined execution.

Got it, disciplined execution. Alright. So so that’s awesome. And then so, do we want to expand on this? Or do we want to go to the next set, the two things you said?

Another thing we’ll talk about is leadership. And then if you want to, you know, double back on this around the idea of branding, or marketing or sales or something like that, whatever topic you think your listeners would be most interested in. 

But I did want to talk—you and I chatted when we were getting ready for the show, about an idea I gave a TED Talk on, on the future of leadership. And I think that everyone, whether you lead one person, or you lead a large firm, there’s a couple of things that are fundamental to leadership. You know, honesty, integrity, good communication skills, being able to get along well with other people, collaborate. A few other things—I won’t go through the list, most of us know them. But as I look going forward, there are three quotients that I think leaders need to possess to be successful moving forward. The first one which I don’t need to talk to you about because you’re just SKY HIGH, it’s IQ. Wow, you have an incredible aura. 

Thank you.

Actually, it’s hurting my eyes here.

I didn’t realize you could see that through this computer there but that’s for around sorry, I I know that I’ll put a shade down in front of me or something.

Okay, well, and now I’m going to shoot you down. Because it isn’t your IQ. You can have, an IQ off the charts, and still be a moron at some level. 

Yep. 

So really, it’s not the number, it’s competence. And all kidding aside, you’re extremely competent at what you do. So the idea here is you’ve got to be very, very, very good at what you do. So IQ.

EQ is your emotional quotient. And that’s your ability to make genuine connections with other people, have empathy, and be able to create not just a sense of competence, but also a sense of caring. I won’t go through the whole four quadrant thing—every consultant has to have a four quadrant thing they have. But mine is around competence, concern. High competence, high concern is what you look for as a trusted adviser. 

Low competence or low competence, high—wait a minute, the other way. High competence, low concern, high IQ, low EQ, is someone I respect. They’re bright, they’re sharp, they’re talented, but they’re not very nice. I’m impressed with them. But I don’t trust them. Because I know they’re only looking out for themselves. 

Low competence, low concern—I’m incompetent, and I don’t care. This is not a winning combination!

Doesn’t sound good, no. Alright.

High concern, low competence. I see this a lot, really nice person, sweetheart, but they just aren’t that good at what they do. So we’re getting to the one of high competence, high concern, I wrote a book on leadership, I can basically boil it all down to this idea: A good leader is highly competent, concerned, and here’s the phrase: “I’m good at what I do, and I do it, because I care about you.” 

Okay.

Every one of the folks listening to this, that’s what you want your clients to believe. I’m really good at what I’m doing. I’m getting better all the time. I’m constantly learning, growing, improving, and I’m doing it all to serve you better and to help you more. So that’s the IQ. The EQ we found out is actually five times to nine times more important than IQ. If you’re really competent, but you can’t get along with other people, you can’t lead them, and you can’t really grow your company. 

The third one, which not many people have heard of is AQ, which is your adaptability or agility quotient. And that’s your ability to to move fast, be nimble, pivot, learn quickly, be a voracious learner. But also, here’s the big one, it’s your ability to unlearn things. People with a high adaptability quotient can handle ambiguity, and have enough courage to look at things that don’t work any longer, even if they’ve been doing it 5, 10, 15, 20 years, they say, “It ain’t the way it’s working going forward.” And it’s my belief that AQ is actually more important than IQ and EQ. Because if you’re smart, and you get along well with people, but you can’t keep up with what’s changing in the marketplace, it’s pretty hard to run a business successfully there.

Mmm hmm. I think personally, I was pretty good at the first two—it took me a while for the last one. I think I handled adversity well and all that, and could adapt, but I resisted change. And I assume that’s part of that AQ, is being able to see that change is needed and being able to adapt. But once I did, and this was about five years ago, man, things went through the roof for me. I mean, I just can’t even imagine not doing what I’m doing. And five years ago, I would have told you, “Yeah, maybe three more years, and I’m done.” And now it’s just, like you said earlier, I’m just having a blast. And so I assume that’s that change in me that happened in that AQ? Does that makes sense?

Yeah, and you said you resisted. I do a lot of work with companies that are going through change. And I think there’s a fact that most people don’t understand which is when someone is faced with what they perceive as negative change, they go through the same emotional cycle as if someone they knew died—so literally, depending on the person, it could be that intense. And they go through, you know, denial, then anger, then bargaining, then depression, you know, and all these emotions, even if it’s something as small as like, “Oh, I’m replacing your chair in your office.” “Wait, it took me 15 years to get this thing the shape of my butt. I love this chair! You can’t take my chair!” …up to you know, you’re losing your job or you’re changing your career, you’re getting divorced, or something like that. People will react negatively to change in a strong way and part of your AQ, your adaptability quotient, is the ability to look at change, and just say “I have to go through it. This is something that’s necessary for me to move forward.”

Right? Yep. And that that’s that’s what we did. I was managing partner and five years ago, decided to make a change, and I knew it was for the best but just in my mind, it was—and I found this out recently in my mind, it was my identity somewhat and I was like, “Okay, that’s my identity, and I if I don’t have that, what do I have?” Well, what I found is I have so many more skills other than I was gonna say, other than managing the firm, I didn’t have much go on managing the firm, I look back now, my skills were this: going out educating, speaking, talking, writing, you know, doing all these things. And I would never have had this if we didn’t make that change. 

And so yeah, it’s something that I am a huge fan of knowing that this is existing, and that there’s a way to bring this into your career. And that, I guess, brings me next question. We know this, we know the AQ, the IQ, the EQ, that they’re out there. So do we try to identify? Or is this what you do? To try to identify where everybody is in these quotients, And find ways to affect it, to change, to be different, to be better? How do we use this and then going forward and for us personally and in their business?

That’s a really, really good question. So let’s go through the three of them quickly. These are all skills you can improve. 

Okay.

So they’re all learnable skills. IQ, can’t raise the number per se, but you can increase the amount of information you take in—you can read, you can go to podcasts, you can go to classes, you teach, things like that. So that one you can it that one’s eminently fixable, you just start to study. 

You’re saying that to me personally, right?

Yes, I’m directing this exactly at you. You’re gonna be making a book report to me every month,

I’m going to be held accountable, alright.

EQ can also be learned EQs, there’s three main, major elements to it. The first one is self-awareness, the ability to stop and check, how am I feeling it? This sounds touchy-feely, but the truth of matter is, if you don’t do this, it’s hard to handle the second part. So the first part of EQ is self-awareness. What am I feeling? Am I angry? Am I frustrated? Am I anxious? Somewhat confused? Whatever it might be. 

And then step two to EQ is self regulation, being able to stop there in that gap, and say, “Now that I’ve named the emotion on feeling, let’s just say anger, how can now I regulate to an appropriate way to express that anger or frustration?” Some people, that gap between stimulus and response is very small. And it’s, “I get angry, I yell. I do this, I threaten,” whatever it might be. “I get mad.”

People who are good at EQ have the ability to say “I’m beginning to feel angry, not what is my emotion driving me right now, but what would be the appropriate way for me to respond, if it was in a way that I would be pleased in the way I did it,” I feel like I call it “The Ideal Me,” that I really was able to, to respond in a way that was elegant, and polite, and kind and in a way that I’d be proud of. So those are the first two, that’s a practice thing. Practice self awareness, practice self regulation.

Then the third one is empathy. And there’s three levels here. Sympathy is “I feel sorry for you.” Empathy is “I think I understand how you feel.” And then there’s compassion, which is “I feel sad, and I want to help you.” We’re looking for the one, empathy, in the middle. “Let me try if I can, if I can understand my own emotions, let me make an attempt to try to understand yours. Not saying I know how you feel. But I think I know how you feel.”

Right.

Those three things sound a little amorphous. But the truth of the matter is, if you practice them, you can become much, much better. I had an incredibly low EQ years ago, and it’s something I’ve had to work very hard on. And I’m thinking I’m getting just a little teeny bit better. 

And then AQ, is well, I was gonna say, have you read the book Good to Great, but knowing you don’t read…

I’ll tell you this. I have not read it. But it has been quoted on this podcast many times. And in fact, I just wrote an article for Accounting Today based on a conversation I had with the managing partner of a firm, and it was all about “right person, right seat,” which is in Good to Great, correct?

Good to Great is the right person, the right seat on the right bus. Hedgehog concept, which I think it’s a really important one for again, us talking about your career and your life, the three overlapping circles of what could I be world class at, truly world class, that I love to do, and it also has a strong economic engine to it? I meet a lot of entrepreneurs that are really, really good at something they love to do. Unfortunately, no one wants to pay for it, and that’s called a  hobby, not a career.

But the thing out of Jim Collins I was going to talk about is the Stockdale Paradox. And Stockdale was the highest ranking military officer to be taken, become a prisoner of war in Vietnam. And they sent him to the Hanoi Hilton for seven years, tortured him, I won’t go on and on. At the end of it, he made it out and they asked him, you know, “How did you survive and all these other people couldn’t make it?” He said, “It’s very simple. All of the optimists died.” And [they go] “What?” And he said, “Yeah, the ones who kept saying, ‘I hope we’re out by Christmas. I’ll be home for Christmas.’” Well, then, Christmas would come and go, then “I’ll be home for Easter,” and then “I’ll be home for Thanksgiving.” And year after year after year until eventually, they lost hope. They gave up on themselves and frankly, their own lives. 

Here’s where the AQ comes into it. Stockdale Paradox says you must have the courage to look at the most brutal facts of your current reality, without ever losing faith that you will persevere in the end. So a big part of adaptability is you’ve got to face up to reality. “This is what’s happening in my market. This is what’s happening with my firm. This is what’s happening with my clients. This is happening with technology.” And then look at it and go, “Well, here’s what I got to do to make it better, but I will make it better—I will put my head down and I will fix this, because now I’m not ignoring it and hoping it will go away.” Hope is not a strategy.

No. Alright. Alright. So that’s things that people can work on themselves, to become better, which is then going to affect their firms. I don’t know if we want to transition. But you talked a little bit about, you know, I assume this is then all equated to leadership within the firm. And as a great leader, you need to have, be aware of these three items, know how you can affect them, which we just talked about, and improve, and that’ll help overall.

Yeah. So let me give a little teeny tool here, that sounds really, really simple, but it’s very powerful. Oftentimes, I teach classes on leadership, and by the end of the course, after we’ve been through it all, I have everyone create their own personal philosophy of leadership—a page describing, if I can really be the kind of leader I wanted to be, if I could act and behave in a way that made me proud, and I was sure I was doing the things that would make me a really, in my own eyes, by my definition, a great leader, write that down on a piece of paper and look at it every morning before you start work. And look at it at least, sometimes every day.

When I was a young CEO, that’s what I did. I was running a fairly large company when I was 26, and I was in way over my head. So I had a sheet and I would walk in every day, look and go, “This is who I have to be today. These are the things I have to focus on today, I have to, these are the characteristics and attitudes, behaviors, I have to exhibit today to be a good leader.” And  before I left at the end of the day, I’d sit down with my door closed for a little while and go over the list and say, “How’d you do, John?”

Then once a quarter, I would ask my entire staff to fill it out and give it to someone else and give me all the scores. And then I would stand up in front of my group and say, “Well, I did well in these three or four areas, but you’ve scored me low in these three areas, I promise you, I will work on them. And I’ll bring those numbers up for next quarter.” So I held myself accountable to it every week, and then I asked my team to hold me accountable to being that kind of a leader, because my quote was, “I’m going to ask you to act and behave and do things in a certain way for the company. I need to make a promise that I’ll do what I say I’ll do, too.”

Right. That there alone, shows leadership. I mean, then that, that me just that I want you to give me input on how I can do my job better, how I can be a better person, that alone, people are going to love, I would assume, and so that’s great. 

Alright, John, everything you’ve told me has made me think, one, I gotta go read books; two, I just gotta go listen to you speak everywhere I can—I’m gonna start looking at all the videos on YouTube or wherever there’s things out there. But three, before we close it out, is there some final wrap up, some final piece of advice that you’d like to give everybody? 

Yeah, thank you for the opportunity to say this. I gave a TED Talk years ago, on the most important thing I’ve ever learned. And I’ll give you the top two. Number one is—or number two, the second one, is “ask for help.” A lot of people think it shows weakness to ask for help. It’s the exact opposite. I’ve worked for several billionaires, worked for a lot of very, very successful people, and the most successful people I’ve ever met are great at asking for advice, input, suggestions, feedback, help. So number two, ask for help. 

The single most important thing I’ve ever learned—you become what you focus on, and like the people you surround yourself with. Whatever you’re—sorry, Randy—reading, studying, looking at, whatever you’re focused on, whatever you fill your brain with, and then whoever you choose to surround yourself with, who you choose to spend your time with, pretty much determines what your company will look like, and your life will look like.

Alright. Alright. Well, those are, I think that’s great. Ask for help. Focus on the things you like, and spend time with people…

Yep, things that are important to you, become what you focus on, like the people you spend time with. And when you hit 60 your memory starts to go.

You noticed that! 

It’s the third most important thing.

I’m four days into my 60s. It’s hitting hard right now.

You can barely remember it now.

Exactly! Well you say all this stuff, I can’t fit it all in at once I have to digest it and then come back to it. 

I thought you had this astronomical IQ?

So at 60 your brain cells start to go. So you never know. I don’t want to take an IQ test anymore, because I think I’ll be disappointed. 

Alright, well, John, that is awesome. That is great advice. I could do this for hours. And I’m probably going to ask you to come back on—well, I am going to whether you agree or not, we will see—but I’m sure there’s plenty of topics you and I could talk about. 

So before we go, anybody wants to get a hold of you or find your books or find out more about John Spence in general, where would they look?

It’s two easy ones. My website is Johnspence.com. Highly innovative there. But my personal email address is John@JohnSpence.com, and I do answer all my own emails. So, but it might take me a few days to get back to you. And if you’ve got a question or something that’s important or urgent, just put that in all caps in the headline, and I will stop what I’m doing and read it. And if I don’t have the answer, I will find somebody who does.

Okay. I just typed an email to you in all caps. So I’m waiting for the response. We’ll see. (I did not) 

I’ve got my mouse ready to go!

I see that! That’s awesome. Well, John, thanks again. This is, I had a great time and I learned a lot, and I think the audience did too, so thanks for being here.

It’s my honor. It’s my pleasure. Thank you.