So for someone like me, what would the ultimate outcome of this product be? Is it a report? Is it a financial modelling that you're doing? Or what's the actual output of this consolidation—of these companies that you're…or these entities rather?

Morris Stemp

The ultimate output is your basic balance sheet, your bank statement, your basic report. So the ultimate output isn't what's unique about this model. It's the methodology that was used to create that ultimate output. And in analyzing the data, the ability to to turn on and off different entities was vital, and especially because some of the entities have to be reported on separately. So in that case, we actually have to turn off the other entities so that we can create the financial statements for individual entities within that group.

Maureen Farmer

So what's the advantage of using Excel to do this versus something off the shelf or some other type of proprietary or license software that would do that?

Morris Stemp

Yes. So there are definitely tools that purport to give you all of this data and can do it. And I'm not suggesting that those tools shouldn't be explored right now. We didn't have the time to find those tools. But even if we had found those tools, I'm not convinced that you could have achieved the flexibility that I've developed within my Excel model, and it's not just the flexibility, it's also the the formatting of the financial statement and results that we're trying to get. So I think that you would have still needed Excel to do some of the work. Additionally, financial people listening to this podcast will know that there's all kinds of formulas that have to remain true. For example, the change in accumulated depreciation has to equal depreciation expense. And I'm not sure if these programs have those kinds of internal validation checks to check where you might be wrong. I built those validation checks into my model where you can actually see where those tautologies are, true or not, within the statements.

Maureen Farmer

So does that improve audit quality?

Morris Stemp

So the auditors obviously are using this model to verify the numbers, but we do a self-audit before you present it to the auditors. We  wouldn't present to the auditors, if we know these numbers don't tie out. So the models have this built-in feature, the type where there might be errors in the system and enables us then to dig deeper within the general ledger to find out where those errors are and then to correct them via the reclassification entries or whatever it might be.

Maureen Farmer

And does this system require a lot of training? Like do you have to train the team on how to use this particular approach that you've developed.

Morris Stemp

So right now I'm running it myself and they're giving me all the entries. Although they are getting a view-only copy and using it for their own purposes. Moving forward into 2021 and beyond, I am trying to write a sufficient documentation so somebody who does have experience in Excel could carry it forward and understand what I've done. So I believe in designing the system and writing some very detailed documentation to enable people to use it. It's not an automated system. It certainly requires, you know, when you get a subsequent years trial balances, there's a lot of manual work in it. You don't just run a process. So it's designed for somebody who has excel knowledge is able to extend it on their own with minimal and ideally no changes to any formulas.

Maureen Farmer

That's so interesting. So I also know that you do a lot of KPI work, key performance indicators work and tell us a little bit about that and how your clients are using that information to make business decisions.

Morris Stemp

Sure. So I work with a lot of companies that are experiencing a little bit of chaos, and they hire me to help them upgrade their people, processes and systems. Most of these companies, they don't have any measurement tools. And if you're coming in there promising to upgrade people, processes and systems, the goal is, of course, to improve some number, whether it's profitability or accounts receivable, turnover, sales, or to lower costs. So part of any engagement that I would get involved with would be to set up a baseline. 'All right. So what are your current revenues? How long does it take you to close a month? How many customers do you have? What is your customer concentration? Whatever KPIs are important to your business. And part of the initial engagement is to do a review of those with the CEO and the senior leadership team to look at what the key measures are that they use to evaluate the health of their business. And then as I put in the new systems and people and improve their processes, we're able to design tools that will report back on how we're doing as it relates to those foundational measures of business health. And those systems could be anything from an Excel spreadsheet to a system that's linked possibly to their quick books, linked to NetSuite. There are many programs that are out there. And in the 35 years experience that I have working with clients on financial systems, I've implemented many tools that help clients. More now on the underlying data within their financial systems, so I then help my clients now choose one of these tools and we use these in either our weekly meetings and certainly monthly meetings to look at how we're making progress on the key health indicators for our business. One of the things that is related to this is I work with the financial teams to understand that their role isn't just to create the numbers so that they can give it to your accountant so they create tax returns. The real use of financial numbers is to use them to understand how the business is growing and to figure out how to strategically take these numbers to improve growth, to drive growth and the health of the business. So I try to shift the focus, certainly of the small and mid-sized businesses of the financial teams from a focus on, 'all right, we need these numbers to generate our taxes' versus 'we need these numbers to understand how to help the business strategically grow'.

Maureen Farmer

That's so fascinating to me, Morris. Now, tell me, when an organization reaches out to you, what is there presenting a problem?

Morris Stemp

I'll say chaos and and the unknown. 'I don't know how the business is growing, but it's growing.' They just don't know how it's growing. Sometimes it's growing fast and sometimes they just went through a period of fast growth and now it's slowed down and they don't really know how they got to where they got and how to make the business continue growing. So I'll say a sense of chaos, a sense of the unknown. And they can't deliver on their sales promises. They can't get the books closed. Customers are complaining, people are blaming each other for not getting things done on time. So I guess that's just another example of internal chaos. So internal chaos, external chaos, things are not getting done. And the CEO doesn't really know where to turn. And generally, there is no senior level operational management within these organizations. So the CEO thought that he could be the CEO and the main salesperson. And you just can't play all those roles.

Maureen Farmer

Right, unless you're Morris Stemp! Because with your hybrid skills, let's talk about that a little bit, because that's a really fascinating value proposition that you bring to the table—is your understanding of all of these different strategic perspectives of an organization, given your background and and the work that you've done over the last thirty five years.

Morris Stemp

Yeah. After I sold so many I.T. businesses, I started to really focus on one of the core strengths that I can offer to a prospective client. And I really dug down into the roles that I played within my organization. I realized that I had this combination of skills and in doing more research on that, I learned there's actually this thing called hybrid leadership skills. And many organizations are looking for this complex, multidisciplinary combination of skills, and it's called hybrid leadership skills. So the skills that I bring to play and that I worked with my clients over the thirty five years are obviously the technologies. As an owner manager of of an I.T. support business, we help clients implement technology solutions for their business processes. So I have both—I'll say the raw hardware operating system level skills—I still like to play with DOS every once in a while. 

Maureen Farmer

That's an old terminology. I haven't heard that in a while. DOS. 

Morris Stemp

1986. Yeah. I have that raw technology skill but I also have the up to date technology skills with both operating systems and with all kinds of applications and obviously all the Microsoft Office products, KPI reporting tools. So technology skills is one then. The next skill I'd say is budgeting and cash flow management. I've designed budgeting and cash flow models for many, many clients, mostly in Excel, but there are a couple of tools that enable you to do that, and I've implemented some of these tools. H.R. and performance management, as I mentioned earlier. I've hired and fired hundreds of employees, both for myself and clients. I've written dozens of job postings. And I have a unique way of actually writing job postings now that I do for my clients. Also, I just don't think that the boring old job postings work anymore to attract the right employees.

Maureen Farmer

Oh, I agree. 100 %. So what are you doing different Morris in terms of that ad copy for job descriptions? What's different?

Morris Stemp

What's different? It's exciting. Let me see if I could find one quick one for you that just reads differently. I'm going to bring one up here. So I created a job posting for a staff accountant. So you're just looking for a staff accountant—it's pretty basic, right? But not in mine. In mine, it says 'our accountants aren't just number crunchers, they're big thinkers, creative problem solvers and subject matter experts on what matters to our clients. They also never stop learning or  getting excited about helping people and they take pride in their profession.' So I'm not saying, 'hey, we need a staff accountant who could post entries into the books and add up and close the books.' And then instead of saying, you know, 'it would be helpful if you have some quick books, online experience,' I would say 'it would also be colossally helpful if you had some experience using ____ in these areas. But no worries. If you don't, we'll train you if you've got the ability to learn.'

Maureen Farmer

Right. And how do you test for those competencies, Morris, once you've got the candidate in front of you?

Morris Stemp

That's well, that's another whole question. I asked very specific technical questions that would enable me to determine what they know. So when I asked you, you know, 'how well do you know Excel?' And you tell me you're an expert, I'm going to ask you some pretty specific questions. And most people, when they answer that question, they say, 'well, I can do a pivot table' and that's the top level of their knowledge, which isn't really being an expert. In fact, I very rarely use that—maybe once in a while, but that's not being an expert in Excel. So I'm going to ask some specific questions. And so when I'm interviewing you and you tell me you know something, you really better know it because I'll figure that out pretty quickly.

Maureen Farmer

Do you ever offer to or ask for on the job testing? You know, that's what we used to do when I was doing a little bit of recruiting for a couple of different companies. We were recruiting for a CFO at the time, and I asked every one of our candidates to give them a case study with a laptop and excel and got them to solve a problem.

Morris Stemp

Right. Right. We did do that when we were interviewing techs for for my I.T. support business. Yes. So, we do do that. And by the way, there are a number of companies out there that you can send prospective candidates to, to be interviewed. Personally for myself, I don't I don't need to do that because I have the background that I could just ask the right questions. For example, if I'm hiring a bookkeeper or an accountant or like the staff accountant, I have a question that I ask that will very quickly tell me how well you really understand accounting. And that question is, what's better, a debit or credit? I mean, I guarantee you, I will know very quickly how much you know about debits and credits. So, yeah, there's very few people that will ever get the answer right. I've probably interviewed 50 people, maybe 5 get it right.

Maureen Farmer

So you're going to give us the answer?

Morris Stemp

No, because those listening to the podcast will know the answers and how to answer the question. If you want the answer, the answer is it does depend. Obviously it depends on the transaction, but it's not really the answer that's important. What's really important is the thought process that I hear you going through and your response as I interrogate you on the various levels of your coming to the answer, whether you eventually get it right. So it's a relatively technical accounting question and it demonstrates whether you understand what's really happening with debits and credits and with your business versus eventually tying banks into your business. And why banks? Why you think a credit on the bank is good when a credit is normally bad on the books?

Maureen Farmer

It's the old contrary accounting.

Morris Stemp

Yes, but why is it contrary accounting? It's not just because banks do it the opposite way. Why are they opposite? Banks don't have an opposite way of doing the books. They do the books the same way everybody else does their books. The question is why? The final way I close my job posting for the staff account is 'if you think you can balance out our team, please send your cover letter and resume to so-and-so. Are you the debit to our credit?'

Maureen Farmer

That's very creative, Morris. That's excellent.

Morris Stemp

'If you think you can balance out our team, please send your cover letter.' And speaking about cover letters, you might find this interesting. I was never successful in hiring a salesperson for my business and I thought that was one of the areas that I always failed at. We would try hiring salespeople. We'd let them work out sometimes—well, always way too long—but sometimes as long as a year. Not really bringing any new business, but they're really great guys. They're great people. You want to like them. And that's what they do, is they go meet people and people like them and want to do business with them. But they just were never able to generate business. So, one of the things that—as I was hiring salespeople, I would sometimes get resumes from salespeople in an email and they would say, 'I'm applying for your sales position.' And I said to myself, you're applying for my sales position and you're just sending me a resume, an email, no cover letter, no text in your email. So you failed in your first demonstration of your competence. You couldn't even sell yourself and you call yourself a salesperson. So a salesperson without a cover letter just doesn't go together because that's the purpose of the cover letter, is to sell yourself.

Maureen Farmer

It's counterintuitive, isn't it? So tell me about what you think was missing from a technical competence perspective when you hired these sales people who weren't able to deliver. What's the missing piece? Is it a lack of understanding of the business or the product? What was missing, do you think?

Morris Stemp

That's one of the things. If I knew what was missing, I'd probably be able to find it. But I never was able to identify that. I don't think it was the technical understanding, because I don't think that salespeople, like good salespeople don't need to come from the industry that they're selling. First of all, you don't sell features, you sell benefits. You could learn the benefits. I really wish I knew the answer to that.

Maureen Farmer

So who ended up being your best salesperson? Was it you?

Morris Stemp

It was me. Well, the I.T. support business—is also sometimes called the MSP, which stands for managed services providers. But I never liked that word because I don't even know what it means. What services are you managing? But people in our field, in I.T. support business, sometimes we call sales, MSPs (manage service providers) and in the service provider business, a lot of the sales is called principle lead selling. It's sold by the owners of the business. So, you know, we were talking about my hybrid skills and while I did develop those hybrid skills while running my business, I always had that focus on benefits, on how to maximize the benefit to the client.

Maureen Farmer

Similarly to the finance piece, where you're not just focused on the financial process, you're focused on, you know, the benefit to the organization of these systems.

Morris Stemp

Yeah, I wasn't selling technology. I was selling how their company was going to run smoothly and how they were going to get this information from the systems and processes that I was going to be implementing. And, you know, I come from an accounting background. So I understand how accounting can be used to serve as a strategic foundation for growing a business. So maybe that was the issue—is that the salespeople didn't have this hybrid background in all the different skills. So they weren't really able to communicate effectively to the client why we were different from our competitors and why they should work with us. They just weren't able to instil the confidence that I could. I mean, I could walk into almost any business and just look around and identify what this company needed to improve their systems and processes and make their lives easier.

Maureen Farmer

Well that's the benefit right there, making people's lives easier. I think that's the goal of any service provider is to do that very thing. And it's the way that value proposition is delivered in a very humanistic way. And, you know, I recall a story about your company helping a large I think it was a senior citizens...we talked about it in the bio. Was it a health care facility?

Morris Stemp

Yes. Yes.

Maureen Farmer

That was a big project you worked on. And I remember hearing about that somewhere. And I think that would be a really great example of how you deliver value, if you could maybe recap that story.

Morris Stemp

Actually, that's interesting because one of my largest clients are called Apex. It's pretty interesting. The Apex means the highest—I'm just laughing now—how it pulls all together. So this client didn't own nursing homes, they basically managed them.

They managed the outsourcing and the purchasing and I.T. and systems and even recruiting and hiring for a whole chain of nursing homes and multiple chains. So I think at the time they had about forty nursing homes. Their goal was to get to, I think maybe a thousand nursing homes. So the nursing home chain asked this company to take over their management of their business, so they hired us to handle all the technology for these nursing homes and for their business to be able to manage their nursing homes. So we had to upgrade all of the technology that the former nursing home management company was using. And it was a giant project. We had probably 20 people deployed on this project and we worked some nights—till 2:00 a.m., I remember, and we were working inside of the old companies, the old IT support company's facility, because there was a whole set of processes we had to do to migrate from the old I.T. business to the systems that we were putting in place. And we couldn't—systems couldn't come down, they wouldn't be able to service the nursing home residents. So we had to make sure that there was no drop in service. And we're also dealing with the nursing home users—they were not the most technologically proficient. So we had to do it in a way that wouldn't impact almost anything that they did. So it was a very, very complex process. But we had all of our senior level engineers working on it at the time. It took us about six months before we were finally able to move all the technology from the old companies data center to a new data center and essentially turn it over to our client.

Maureen Farmer

With no—I believe there was no downturn or loss of service whatsoever.

Morris Stemp

Yes, and no downtime at all.

Maureen Farmer

Yes. That's a pretty big accomplishment.

Morris Stemp

Yeah, it was. We worked really, really hard. The client was so grateful. They brought us to a box at Yankee Stadium, presented us with an award. Yeah, we were exhausted at the end. But it's always very gratifying to be able to provide this this level of service to our clients

Maureen Farmer

And so really, when you look at what you've been able to accomplish and the expertise around these hybrid skills, you know, finance operations systems and I guess the people part of it, which kind of pulls it all together, tell us a little bit more about what you're doing now at—and I hope I say this correctly—TechCXO.

Morris Stemp

Yes. So, TechCXO is a national organization. Actually, they've expanded already to the UK. Maybe they're an international organization—of senior level C Suite executives with probably a minimum of twenty five to thirty five years of experience. It started as tech CFO with senior level financial people, but then as they grew, they expanded to multiple C suite disciplines. So now we're not just chief financial officers. We have chief marketing officers and technology officers and sales officers and chief product officers. So our organization is able to bring to clients a whole range of disciplines and skills from very experienced senior level teams. And so I might start working with the client on maybe a two-day a week outsourced CFO role. And as I'm working there, I'm realizing that the sales team just is is not working effectively and they really need some better sales management. So I'll bring in one of my partners who's a chief sales officer, and he will then start managing the sales team. And we also have a team of employed lower level staff to supplement the clients—of the client needs—some bookkeepers or controller level people. We have those kinds of people who can contribute their skills as well to supplement calls, I guess staff augmentation, supplement the client's existing staff until they're able to hire their own. So I go in work as a, let's say, two day a week outsourced CFO—could be longer maybe. And we have some clients that need interim CFO. So interim engagement is where a client might hire a CFO full time for three months while the client embarks on a recruiting effort to bring in a full time CFO.

Maureen Farmer

And do you help with that part?

Morris Stemp

Absolutely, we would help, you know, document the job description and do the interviewing and eventually be involved in the final selection.

Maureen Farmer

So it really, truly is a hybrid skill set that you bring to this process, for sure. This is amazing. I'm just here looking at your your resume. It's fantastic. So the fractional piece is what you were referring to. Somebody just needs two days a week here, two days a week there—that type of thing? Is that what the fractional piece means?

Morris Stemp

Fractional would basically be two days a week every week. So it's a regularly scheduled engagement with this client. So you're working on their behalf. You know, every Monday, Wednesday, you're dedicated to them for a full day or it could be a half day. We'll do project work like this work I'm doing on this consolidation, that's really a project that will eventually end. Although there are other things that may want me to do and they'll put me on another project. So we have project fractional and interim.

Maureen Farmer

So, Morris, you've had an amazing career so far and it's still going strong. What has surprised you most in your career so far?

Morris Stemp

I would say number one is the is the need for this hybrid skill set. I don't think you can really effectively perform your job without having a much broader picture of a client's requirements. You know, for me to go in and only be able to handle the finances would be missing a huge part of what impacts a client's success. And that being the technology and nature and performance management and KPIs. So that's number one, having this broad range of skills that I have is I think, so critical. It's been so helpful to me in doing the work that I do. I think the next thing—being a go-giver, there's a book by Bob Burg called The Go Giver. And it's a fable about how this salesperson eventually realizes that by giving, he eventually will get. It's not a tit for tat kind of thing. But you focus on giving value to your clients, eventually you're going to get back. And one of the things that I endeavor to use is—so I have I have 100 partners within the TechCXO organization. I endeavor to give them as much as I can—knowledge I have about technology solutions and share all kinds of solutions that I've learned about—both to make them more productive, as well as to make their clients more productive. And I don't expect anything in return. But in fact, all of the business I'm currently working on came from the my TechCXO partners who have seen that I have the skill to be able to support the references that they've given me—the client and potential client references that they have given me. So that's how I've gotten my business, is by sharing with them my technology background to help them and their other clients out. So I think being a go giver will get you far. Another thing is when I was interviewing at TechCXO, I was actually recruited by a number of outsourced CFO companies—they wanted me to join their teams to be an outsourced CFO. But one of the things that I observed about TechCXO during my recruiting process was how humble and giving every member of the team was. So during my recruiting process, I interviewed probably eight to 10 other partners and had a chance to ask them questions and learned more about how they built up their business, and every one of them was was so humble. And I got the sense that they were really giving people. And that definitely has been true in my experience as I met more and more partners. So go giver and a sense of humility. And it's hard to talk about such humility. I feel a sense of conflict in even talking about humility...

Maureen Farmer

Well, you can stop right there and I'll just speak on your behalf, because I've known you for a few years now, and I know that you are one of the most generous, you know, colleagues and executives and leaders out there. And I've spoken to a number of your colleagues and clients and employees over the past couple of years. And they've all said the same thing. So that's really about your brand, your personal brand, Morris. And that speaks to your generosity and your willingness to serve as a resource to others. And, you know, I think it's definitely on point. So. So there you go.

Morris Stemp

Thanks Maureen.

Maureen Farmer

You're welcome. My pleasure.

Morris Stemp

The last thing that I believe was surprising is to never stop learning. There's always a tremendous amount to learn. And I think it's so important that especially for job seekers, I think to make that really clear through examples, not just by saying that, you know, I love learning and I focus on learning, but, you know, specific examples of what you've learned and how you go about learning because that is—any organization is going to need their employees to be to be constantly learning. I had a client where the CEO was very growth oriented and focused on continuous learning. And I remember the CEO was very frustrated that their colleagues were not as focused on learning. And what the CEO did is they put a program in place. It was called Challenge, Learn and Grow—CLG. And it was all about executing one learning initiative for the year. I mean, the more the better. But this program was about achieving one specific learning outcome during that year, and they rolled it out to the entire team. And the only people that didn't do it was the CEO's colleagues. That was really the reason for doing it was to get her colleagues to focus on growth and learning as well. But the team loved it because the team loved having this challenge and having the whole company focused on a common goal of learning.

Maureen Farmer

You can't beat it, in my opinion. So, Morris, look, it has been such a pleasure having this conversation today. And before we close the call, why don't you tell our listeners today how they can get in touch with you?

Morris Stemp

So they can get in touch with me very simply, at first name, Dot, last name, at techCXO dot com, that's Morris Stemp at TechCXO.com or just go to my website, MorrisStemp.com.

Maureen Farmer

Yeah, it's a great website. So Morris, again, thank you so much for joining me here today. And I would like to extend a challenge to the listener who's listening here today. What are the top three takeaways from my conversation with Morris that you can implement in your own business today? So that's your takeaway challenge. And Morris, I'm going to close out the call now—just to say thank you once again for lending your expertise. And we will, I'm sure, be in touch in the future.

Morris Stemp

Thank you, Maureen, I enjoyed sharing some of this with you, and I definitely look forward to speaking with you more as well.

Maureen Farmer

Awesome. Take care, Morris.