The Change Your Mindset Podcast

Welcome to the Change Your Mindset podcast, hosted by Peter Margaritis, CPA, AKA The Accidental Accountant. Peter is a speaker, expert in applied improvisation and author of the book 'Improv Is No Joke, Using Improvization to Create Positive Results in Leadership and Life'. Peter's new book, Taking the Numb Our of Numbers: Explaining & Presenting Financial Information with Confidence and Clarity will be published in June 2018.

S2E41. From Fear of Public Speaking to TedX Through Improv with Dr. Mihaela Jekic

Dr. Mihaela Jekic is a money coach, author, and TedX Speaker. Mihaela helps professionals and entrepreneurs transform their money mindset, help them get unstuck financially, and build a business and life they love. She’s gone from losing everything during the Bosnian Civil War and being a refugee to paying cash for her home in Ohio in her early thirties. She speaks and conducts workshops on personal transformation, financial freedom, and resilience. Mihaela co-authored Money for Meaning: Philosophy for a Life of Extraordinary Freedom.

How she came to this point was a long, winding journey. She had a pretty normal childhood, until one day she woke up to the news that the city had been barricaded and heard gunshots in the distance. So they packed up their car and left, and that was the last day she saw her childhood home.

Looking back, Mihaela feels grateful for these events. She learned to value experiences and people over anything.

Three years after that, her family ended up moving to Toronto, Canada. MIhaela started attending high school there, with the added struggle of not speaking any English. She had to learn to adapt as she went. Four years later, she had the highest English grade of her graduating class. With hard work, and stepping out of your comfort zone, it is really amazing what you can accomplish!

Mihaela moved to Columbus to attend college at Ohio State University. She had a wonderful experience there competing in fencing, but a couple of years in she felt like something was off. Once fencing was done, she realized she just did not enjoy the research requirements of the college. She was anxious, depressed, and she ended up developing a fear of public speaking.

From then on, she believed that she was terrible at thinking on her feet and that she should avoid public speaking. When she had to, she would just memorize all of her lines. Eventually, she decided enough is enough. This fear was holding her back, and it was time to do something radical. That’s where improv came in.

The courage to have her business and to speak on stage all came from the decision to sign up for that class. Improv is not just about comedy and one-liners. It’s about being able to connect with other people at a deeper level. You learn to make eye contact, read body language, and empathize with others to create this scene. It is a process that can translate to your business and to your career. For Mihaela, it was transformative.

About a year and a half after signing up for that class, Mihaela found herself on a TedX stage performing with an improv comedy troupe in front of hundreds of people. That shattered her previous beliefs of what she was capable of. Inspired by this experience, she realized that all of these other beliefs about herself could be wrong as well. If all of that was false, then what else is possible?

What area do you need to grow in? And what is that one bold decision that could change your life? Improv could be the tool to get you out of your comfort zone and to transform into a new, better version of yourself.

Resources:

Transcript:

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Dr. Mihaela Jekic: [00:00:00] Work hard. And if we step out of our comfort zone, to reach out, to communicate, to be willing to make mistakes as I have many times, and to fail at it, and to repeat myself, and so on. It is really amazing that—what we can accomplish.

Peter Margaritis: [00:00:25] Welcome to Change Your Mindset Podcast, formerly known as Improv is No Joke, where it’s all about believing that strong communication skills are the best way in delivering your technical accounting knowledge and growing your business. An effective way of building stronger communication skills is by embracing the principles of applied improvisation. Your host is Peter Margaritis, CPA, a.k.a. The Accidental Accountant. And he will interview financial professionals and business leaders to find their secret in building stronger relationships with their clients, customers, associates, and peers, all the while growing their businesses. So, let’s start the show.

Peter Margaritis: [00:01:11] Welcome to Episode 41. And my guest today is Dr. Mihaela Jekic, who’s a money coach, author and a TedX Speaker. Mihaela helps professionals and entrepreneurs transform their money mindset, help them get unstuck financially, and build a business and life they love. She’s gone from losing everything during the Bosnian Civil War and being a refugee to paying cash for her home in Ohio in her early thirties. She speaks and conducts workshops on personal transformation, financial freedom and resilience. Mihaela co-authored Money for Meaning: Philosophy for a Life of Extraordinary Freedom. Now, our conversation centers around her journey from her time as a young girl in Bosnia, to earning her PhD from The Ohio State University, to getting past the fear of public speaking, to her business today. This is a fascinating and inspiring journey.

Peter Margaritis: [00:02:08] As you know by now, Change Your Mindset is part of the C-Suite Radio family of podcasts. It is an honor and a privilege to be amongst some of the more prevalent business podcasts, such as The Hero Factor with Jeffrey Hayzlett, Amazing Business Radio was Shep Hyken, and Keep Leading with my good friend, Eddie Turner. You can find Change Your Mindset and many other outstanding business podcasts on C-Suite Radio by going to www.c-suiteradio.com.

Announcer: [00:02:37] This podcast is part of the C-Suite Radio network: turning the volume up on business.

Peter Margaritis: [00:02:42] Now, many of you don’t know that I’m a type 1 diabetic, and I do volunteer my time to the Central Ohio Diabetes Association, which is part of the LifeCare Alliance Organization here in Central Ohio. Here’s a short commercial about the upcoming Santa Speedo Dash, where all the proceeds from the dash help fund the Central Ohio Diabetes Association summer camp for children with Type 1 and Type 2 diabetes.

Kathy: [00:03:10] Hey, Anthony, what’s with the bells?

Anthony: [00:03:12] Hey, Kathy, I’m putting my outfit together for the Santa Speedo Desh.

Kathy: [00:03:16] Love the red leggings too. So, you’re going to run in the Santa Speedo Dash on Saturday, December 14th to support Campi Hamwi?

Anthony: [00:03:22] You betcha. Will you be there?

Kathy: [00:03:24] Of course. It’s the only date I’m allowed to wear a bathing suit to work.

Anthony: [00:03:28] Help us give kids with diabetes the experience of a lifetime. Proceeds from the Santa Speedo Dash support Camp Hamwi. Register or donate today at www.santaspeedodash.org.

Peter Margaritis: [00:03:42] And now, a word from our sponsor.

Sponsor: [00:03:45] This episode is sponsored by Peter A, Margaritis LLC a.k.a. The Accidental Accountant. Are you looking for a high-content and engaging speaker for your next conference? Do you want to deliver a story to stakeholders that will transform data dumping to engage in business conversations? Do you want to feel that the value a speaker provides your audience far exceeds the dollar value on their invoice? Then, book Peter for your next conference, management retreat, or workshop. Contact Peter and peter@petermargaritis.com, and visit his website at www.petermargaritis.com. By the way, one of his Fortune 50 clients actually made the comment about the value he brings to your audience.

Peter Margaritis: [00:04:34] Now, let’s get to the interview with Mihaela Jekic.

Peter Margaritis: [00:04:41] Hey, welcome back, everybody. Oh, my God. Do I have a treat for you today? My guest today is Mihaela Jekic. And I’m a let her talk about this fabulous story of her life and this journey that she’s been on. I met her recently at a Professional Speakers Toastmaster event. And she’s got this wonderful story. And I was able to get her on my podcast. So, first and foremost, thank you, Mihaela, for taking time out of your schedule to be with me today.

Dr. Mihaela Jekic: [00:05:12] Thank you so much, Peter, here for having me.

Peter Margaritis: [00:05:14] I’m going to just turn it over to you. You have such a fascinating story. And it’s a journey that has taken you to Columbus and to what you’re doing right now. So, if you could share some of that story with my audience, I think they’ll just find it incredibly inspiring.

Dr. Mihaela Jekic: [00:05:31] Sounds great, Peter. So, yes. So, what I do today is I am a financial coach, an author, and a speaker. But yes, how I came to this point is a long, and winding, and twisty journey. First of all, English is not the first language I learned. I grew up in Sarajevo, Bosnia, which was part of a communist dictatorship called Yugoslavia from the Second World War until the death of the Dictator, Marshal Tito in 1980. And I was born shortly after that point.

Dr. Mihaela Jekic: [00:06:10] Now, when Tito died, he left a power vacuum and collapsing economy. And over time, tensions were built. And then, when I was 10 years old, my life changed forever. I had a pretty normal childhood, as you might expect. You know, visited grandparents on the weekends, went to school, played with my friends. And then, one morning, we woke up to news on the radio that much of the city had been barricaded and heard gunfire in the distance. So, we got some things, put them into a car, and we left.

Dr. Mihaela Jekic: [00:06:50] And I’ll never forget what my mom said as we were leaving. She said, “Get your books, get some more things. We could be gone for two weeks.” But I knew this that she didn’t really believe that. She thought she, honestly, with every fiber of her body, she believed that it would all blow over in a weekend, and life would return to normal. It just had to. I mean, this was three groups of people living together in this country. It was just unthinkable what was about to happen. But 27 years later, that is the last day I saw my childhood home.

Peter Margaritis: [00:07:27] Wow.

Dr. Mihaela Jekic: [00:07:28] So, now my life went in a very different direction. So, we were refugees. We had family members in a safer part of the country that we eventually were able to go over there, and they offered us temporary shelter. We got food packets from the Red Cross that were really helpful during this time. I still remember standing with my mom and my little brother in line for these. So, yeah, it was just this unbelievable experience. But looking back, honestly, I feel grateful for this in a way. I mean, obviously not the war an so on, but what came out of it is I learned to value experiences and people over anything. We lost our home. We lost all our possessions. And I realized that that’s not what really matters in life. It really is the people and experiences that nobody can take away from us. So, that created some of the foundation, which is what I’ll come back to later.

Dr. Mihaela Jekic: [00:08:29] So, three years into this, I learned that my family was moving to Canada to start a whole new life. And honestly, I was super excited about this. I did think it was kind of like the Wild West a little bit from all the cowboy stories I read. Yeah. It turns out Toronto was not like [indiscernible]. But it was September, and I was 13 years old. So, it was time to start high school, which would be gut-wrenching feeling, I think, for anyone. It’s like even if you grew up here, it’s like high school is this whole new thing. How we’re gonna fit in? And our friends are going to like us. But at that point, I had one detail that made it a little different, which is I didn’t speak English. So, I walked into high school kind of terrified. And it was what you sort of expect at that point. I didn’t know what was being taught, or what my homework was, or where to go for a class even.

Dr. Mihaela Jekic: [00:09:40] And I still remember this, when somebody told me that I needed to go to the upper gym, and I sat there so confused about who Jim was. So, it was—talk about improvisation. I know you talk about this on the podcast. But just figuring out, you know, the [indiscernible], where to go, and so on, and how to adjust to all that. So, that’s another one of those foundational experiences. But four years later. I got the highest grade in my graduating English class.

Peter Margaritis: [00:10:18] Wow!

Dr. Mihaela Jekic: [00:10:20] Yes, I was so—that was just a lot of hard work, and stepping out of my comfort zone. It’s going in. I have a feeling of I’m just not as good as other kids. I’ll never catch up. Everything is so far ahead. Just that insecurity, but through this, it is, honestly, if we work hard, and if we step out of our comfort zone, to reach out, to communicate, to be willing to make mistakes, as I have many times, and to fail at it, and to repeat myself, and so on. It is really amazing that—what we can accomplish.

Peter Margaritis: [00:10:59] Well, just so the audience knows, you mentioned improv, and you have taken improv classes.

Dr. Mihaela Jekic: [00:11:06] Yes.

Peter Margaritis: [00:11:07] And you’re the accidental improv artist.

Dr. Mihaela Jekic: [00:11:12] Yes, I certainly am. And just to quickly fast forward within one minute to the point of improv with that. So, I went to study engineering in school. And the reason that I am in Columbus, Ohio today is I was finishing school in Canada, I discover the passion for saber fencing in college. I know, talk about out of left field, right? A friend brought me into a class, and I became so obsessed with it. I was training super hard. And at the end of this, I won the varsity championship for all of Ontario universities and the Female Athlete of the Year award at my university, Carleton University in Ottawa that year. But I still wanted to go to the next level.

Dr. Mihaela Jekic: [00:12:01] So, I started to look at where the great coaches were, and I found one at The Ohio State University, and I thought, “Well, I’m in Ottawa. He’s in Columbus. I’m past the varsity time period. So, how am I going to work with this guy? I really want to do this.” And then, it hit me. I got it. I’ll go to Ohio State and get a PhD.

Peter Margaritis: [00:12:26] Of course. Why not?

Dr. Mihaela Jekic: [00:12:28] Of course. So simple. Problem solved. So, I applied, and this was the only college I applied to for a PhD program. Got it in right before the deadline. And I got interviewed and offered a full scholarship and stipend for Biomedical Engineering PhD at Ohio State. So, I was on my way. And fencing-wise, this was a wonderful experience. It got me to bronze medal at Canadian National Championships. But a couple of years in, I really started to feel like something was wrong. I was not on purpose. I mean, I started—so, fencing was done at this point in time. I was done. And I just—I really—to say that I was not enjoying the research side of things is an understatement. I mean, truly. I mean, I felt anxious and depressed all the time, not like myself at all. I was trying the way these 70, 80-hour weeks. And it just—you know, I feel like it was really a challenging period in time. And during this time, I also happened to develop a fear of public speaking as well.

Peter Margaritis: [00:13:42] What?

Dr. Mihaela Jekic: [00:13:42] My PhD candidacy exam was, really, I felt such a humiliating experience. I froze like a deer in headlights. I just—I couldn’t remember answers to even basic questions. It was—I mean, horrible. In the end, my adviser said that I passed just because my written answers were so strong. So, from then on, basically, I believed that I am terrible on my feet, that I should avoid public speaking. When I had to do it, I would just memorize everything. And, you know, it was just a torturous experience where I wouldn’t sleep the night before obsessing about every question I could be asked just because I didn’t want to feel that yelling of humiliation all over again. And finally, that’s where improv comes in. I decided enough is enough. This is holding me back. I have to do something radical. Radical.

Peter Margaritis: [00:14:43] Radical, exactly. Improv is radical in a lot of ways.

Dr. Mihaela Jekic: [00:14:46] Improv is radical for an engineering PhD, with a fear of public speaking. Improv is beyond radical. So, it is terrifying. I remember, I almost turned around driving to my first class. I had this acid feeling in my stomach, and just tension in my body, wondering what have I done to myself. I’d be like a fish out of water, just humiliated. I mean, this is a terrible idea. But there was a deeper as well that said, “You need this. Think about how much you could grow.” So, I went in. And thankfully, it wasn’t nearly as terrifying as I thought it would be. In fact, I encountered this, like, amazing supportive group in Columbus, Ohio, the Wild Goose Creative. Just just wonderful, loving, supportive people. And I really grew leaps and bounds from that.

Dr. Mihaela Jekic: [00:15:49] The courage to have my business today and to speak on stage is all since from that one bold decision to sign up for that class. So, that’s what I would encourage the listeners to do. What area do you need to grow in? And what is that one bold decision that could change your life? To go out of your comfort zone and to transform into this new version of yourself that you don’t even recognize.

Peter Margaritis: [00:16:18] As a friend of mine says – his name is Jason, he actually my my improv coach – “If everybody will take, at least, one improv class, this world would be a lot better.”

Dr. Mihaela Jekic: [00:16:28] Absolutely. And it’s not just about the snazzy, you know, one liner, and so on. It’s about being able to connect with other people at a deeper level. Eye contact, body language, to feel what they’re feeling, to create this scene. It’s not creation, actually. It’s discovery. It’s like you discovering your character and you’re doing it together with somebody else. So, it’s this beautiful. Yes, I know it sounds like a scary process, but in the right environment, it is a beautiful process that can truly translate to your business, to your career. I mean, being able to read body language, to connect with people on a deeper level, to communicate more effectively is so essential. It was transformative for me.

Dr. Mihaela Jekic: [00:17:16] And as a side effect of that, some unbelievable things happened in my life as well. So, about a year and a half after signing up for that class and surviving, I found myself on a TedX stage performing with an improv comedy troupe in front of hundreds of people. Wow. That shattered my notions about who I was and what I believed I was capable of, honestly. And so, a few weeks after that, I was walking down my street. And inspired by this experience, I had this just massive insight that I have no idea who I am, not what my passions or interests are, but more on a deeper level. It’s like I don’t know. If I believe all this about myself, that I’m terrible in my feet, that I’m limited in this way, that I could never speak on stages, that I could blah, blah, blah, blah, blah. If all of that was false, then what else is possible? I don’t know where the limit is or what possibilities still await it.

Dr. Mihaela Jekic: [00:18:33] And so, letting go of these limitations about what we believe we are, whether it’s an accountant and are focused on number, but, you know, not necessarily somebody who loved serendipitous, exciting things, and so on. Whatever it is, it’s just that whole notion of who we believe we are, they actually turn out to be completely false. And when we take bold things, step out of our comfort zone, we really discover who we are, and what we’re capable of.

Peter Margaritis: [00:19:06] Oh, my God. You’ve made it such a wonderful commercial and validating things that I’ve been saying for years. And finally, three years on this podcast, you just summed it all right up what improv can do for everybody. It’s not—I always say it’s magical because you just never know what you can do. I mean, you started a business, you’ve been on a TedX stage. You were just recently on a TedX stage again.

Dr. Mihaela Jekic: [00:19:35] Yes, that’s right. So, I gave a TedX talk. So, my first time, it was as a performer. Yes, I was the intermission basically at the first TedX event doing improv comedy. And then, I just recently did a TedX talk called Turning Humiliation into Transformation. And that talk should be posted on October 11th. I guess, today. So, it should be posted any day to the TedX site by the time this podcast comes out. I would love for folks to check that out because I really go deeper to share the lessons learned. And also what I’ve found, the question that I asked myself that bring down that anxiety and fear about stepping into the unknown, which is—the questions are not, will I succeed or fail, or, you know, what will other people think? The questions are, will I grow from this? Will I create something new in my life or in the world? And will I connect with amazing, new people along the way?

Dr. Mihaela Jekic: [00:20:44] I mean, I answer yes to these questions, whether it’s—and you know, I feel anxious for networking events, and things like that, and in business. And obviously, you have to—from doing sales and all these other things that are uncomfortable, but reframing it in this way, and asking these questions, I truly find has been transformational for a perfectionist like myself, to focus on growth, creativity, and connection instead of just an outcome. It’s been so liberating. So, I would love for folks to check out the TedX talk when it comes out.

Peter Margaritis: [00:21:19] So, we’re going to take the some of these quotes that you just gave us, and put it as the social media graphics. So, for two reasons. One, I love the quotes that you’ve given us. For two, as a reminder for those who are listening to this podcast to go grab those graphics and put them on your computer. Put these words that you’re saying in front of yourself to remind yourself on a daily basis things that we need to do to become bolder, and how improv can get us there. And as we say in improv, follow the fear.

Dr. Mihaela Jekic: [00:21:55] Yeah, yeah.

Peter Margaritis: [00:21:55] Just leave it and do it. Just follow it. It’s— I used this last night. I was doing a session for Slide Deck Improv up in Cleveland, and I said, you know, “If we stay in our comfort zone, that’s where our dreams go to die.”

Dr. Mihaela Jekic: [00:22:09] Yes, yeah.

Peter Margaritis: [00:22:11] “But when we step out of our comfort zone, that’s where magic happens. That’s where dreams come alive. And it’s scary because be careful what you wish for, it actually might come true. But it’s so liberating when it does. It’s so magical that, oh, my God, I can’t believe I did this.”

Dr. Mihaela Jekic: [00:22:27] Yes. [Crosstalk].

Peter Margaritis: [00:22:28] It came from a refugee to here. I mean, it’s amazing.

Dr. Mihaela Jekic: [00:22:33] Yes. So, it’s thoroughly transformational. So, yeah, as I mentioned, it’s been in my financial coaching business. I mean, I was the kind of person who would—I would feel, honestly, just out of my comfort zone just doing phone calls in the past. I would like write down bullet points. And yes, I am admitting this, and that has totally changed and transformed. I love working with clients and adapting, you know, to each particular individual in terms of their style, and needs, and in terms of what they need to do to go to the next level to reach their goals. So, it’s been so, so amazing.

Peter Margaritis: [00:23:17] So, let me ask you this question. And so, what’s—so, public speaking was one of your big fears, and you’ve accomplished that. What’s another one of your big fears that you haven’t accomplished yet, but you want to. And you want to use improv to help you do that. And then, I’ll preface it. I have a fear of heights. I do. Sometimes, I go over some large bridges, and I start freaking. I want to skydive. And I told my wife this, and she said, “Okay, let me check the life insurance policy first,” but I’m committed to doing that. I just haven’t committed to a date to do it, but it is—it will happen in 2020. Is there something like that in your life that you have yet to accomplish, but you want to, and you want to use that power of yes and improv to make that leap to do?

Dr. Mihaela Jekic: [00:24:06] So, at this point in my life, I really feel like it’s related to this business. I want to speak on bigger stages, impact more people. I want to grow this business to the next level, and again, impact and transform more people’s lives. I find that so meaningful and so satisfying. So, I want to move in this direction. So, like a client that I had recently, actually this couple that I worked with, and both high earners, but at the same time, they hadn’t saved anything over the last year, had growing credit card debt, and other kinds of debt. And she had this passion to transition out of her corporate career and start a nonprofit that she is so, you know, on fire about. But she couldn’t because of the financial limitations.

Dr. Mihaela Jekic: [00:25:03] So, working with them, over a three-month period, they went through paying off their consumer debt, their credit card debt, and bringing up over $5000 of monthly cash flow. She has started her nonprofit and is going to be able to leave her corporate job in March to be able to do it as full-time. And I think it makes such a big impact on the people that she’s going to work through with this organization. So, that’s the kind of stuff I feel like that lights me up.

Dr. Mihaela Jekic: [00:25:38] Or another example on a different direction, this business owner that I’m working with. And she is one of the kindest people that I have ever encountered. And her business has a wonderful mission, but at the same time, it’s like even though it had, you know, high revenues, almost seven figures, there was nothing to show for it at the end of the year, I mean, it was actually in the negative to the point of her family contributing retirement funds to keep this afloat. So, immediately, we identified big opportunities for her to improve her cash flow. And as a result of that, that’s going to be transformational for her and her family.

Dr. Mihaela Jekic: [00:26:17] So, this is—I think it’s so amazing. It’s not—you know, my degree is in engineering as a PhD. I decided when I finished that that—and this was a big decision, you know, not to pursue that direction, to go into academic research, and so on. I actually ended up working for a public private partnership to grow entrepreneurship in Ohio and so on. But yeah, just as I said, it’s not necessarily what my background is, but it’s what I absolutely love doing and want to take it to the next level.

Peter Margaritis: [00:26:51] So, as we begin to wrap wrap this up, I just want to share with the audience, we’re on Zoom, and I can see Mahaela as she’s telling these stories, and she lights up like—I mean, oh, my God, you can see the passion because her eyes are sparkling. She’s got this great smile. And she’s just telling the story, and you can just tell that, yeah, she absolutely loves what she’s doing. And so, I know you’ve written a book. And the book, you and your husband wrote it. You co-authored a book. And the name of the book is?

Dr. Mihaela Jekic: [00:27:23] Money for Meaning: Philosophy for a Life of Extraordinary Freedom.

Peter Margaritis: [00:27:29] And it’s on Amazon. It’s on a-

Dr. Mihaela Jekic: [00:27:30] Yes, yeah.

Peter Margaritis: [00:27:31] Okay. So, go out and pick up her book. The name of the business is?

Dr. Mihaela Jekic: [00:27:36] It’s Money for Meaning as well.

Peter Margaritis: [00:27:38] As well. And that’s the website that people can find you?

Dr. Mihaela Jekic: [00:27:41] Moneyformeaning.com, yeah.

Peter Margaritis: [00:27:44] Moneyformeaning.com. And do you—would you like to share an e-mail address with the audience if they want to drop you a quick e-mail to maybe contact you?

Dr. Mihaela Jekic: [00:27:54] Yeah, that’ll be great. It’s Mihaela. So, my first name. I’m going to spell it out. It’s M-I-H-A-E-L-A @moneyformeaning.com. Yeah. I would be happy to connect.

Peter Margaritis: [00:28:10] So, if you have a—we’ll put in two pieces. If you want to learn more about her passion as it relates, outside the Money for Meaning, and her story, and her journey, or if you’re in a financial situation that you’re kind of stuck, and you need some help, contact her. Clearly, she can help you. And you know what, if you want somebody to help you that really loves what they’re doing, and smiling through it, and making you feel good about it, then you need to contact Mihaela.

Dr. Mihaela Jekic: [00:28:41] Oh, thank you. That would be great. And, you know, I can be definitely, I would say, pleasant to work with. At the same time, though, I do see people accountable. I truly do with everything, with follow-up, the tangible action items, with deadlines. And then, if those are not done, then we really go deep into the mindset of what’s going on. We get to that transformation.

Peter Margaritis: [00:29:06] And that’s the other good part. She keeps you accountable. And, you know, that’s—a lot of times, coaches don’t keep us accountable to that degree. They may keep us accountable on the surface, but she goes deep. So, Mihaela, I want to thank you again for taking time to be with—I love your story. I love your journey. I love what you’re doing. Keep doing that great work. And I look forward to seeing you onstage, hopefully, sometime soon.

Dr. Mihaela Jekic: [00:29:33] Sounds great, Peter. Well, thank you for having me.

Peter Margaritis: [00:29:39] I hope you’ve enjoyed Mihaela’s interview and learning more about her journey. You know, we are all on some type of journey with the highs and lows. Persistence and perseverance wins when you hit those lows. Fight through them because as the old saying goes, what doesn’t kill you makes you stronger. Thank you for listening. And if you’re enjoying this podcast, please subscribe and share this episode with a friend. Make today your best day.

Announcer: [00:30:13] Like what you just heard? Because it’s c-suiteradio.com. C-Suite Radio: turning the volume up on business.

S2E40. Get The Sleep You Need by Breathing Right with Tara Clancy

Tara Clancy is a speaker, author, and sleep expert. Tara is also a member of the National Speakers Association and currently serves as the President of the Connecticut Chapter.

Tara has a lot of great tips and advice for us to think about during our day as it relates to our daytime and our nighttime breathing in order to get a good night’s sleep. She discusses the long-term ramifications of nighttime breathing issues and the effect it has on our bodies and on our brains.

Tara’s journey as a sleep expert began with the realization that she had been dealing with a sleep problem for her whole life. She had dealt with a succession of health problems her entire life: She had sinus infections, asthma, skin problems, and then gut issues. All of this built up to take away from her overall health and wellness.

Then, just by chance, she found out that it was actually all related to a nighttime breathing problem. At first, the news was kind of worrying. Breathing issues are no joke. But then she realized, if there’s just one problem here and not several little ones, there’s a better chance of her actually solving it. That is how she was introduced to studying proper sleep and how she became a sleep expert herself.

We’re all aware of sleep hygiene now largely, and we think as long as we’re getting 8 hours of sleep a night we’re good to go. But Tara was getting 8 hours of sleep and still needed that caffeine to get her going in the morning. She needed an afternoon power nap. And her need for adrenaline increased to the point she took up rock climbing!

Along with those things, waking up in the middle of the night suddenly, or to have to use the restroom, can all be warning signs or red flags that the quality of your sleep is not in the best shape.

One way you can tackle your poor breathing (and consequently, poor sleep) is through an exercise called LILO (Less In Less Often). The number one thing that people are doing that creates problems is mouth breathing. As soon as we start mouth breathing, we throw off the ratio of the gases in the blood. Mouth breathing also ends up causing inflammation because your nose is doing all these things like filtering the air, warming the air, cleaning the air, and moistening the air, which our mouth just doesn’t do, so we end up with inflammation at the back of our throats. If you have inflammation, that means the airway is now going to be smaller. Then when you sleep, your  muscles relax, and your airflow gets disrupted.

The goal of the breathing exercise is to undo some of that over-breathing when you breathe through your mouth. If you spent your whole day over breathing, then you want to set yourself up at night by taking less in, less often, so that it compensates for what was happening during the day. You just take in a smaller breath than you normally would, and you wait an extra moment before you take in that smaller breath. By doing that, you get yourself into the right nervous system mode and help to rebalance the gases in the blood. If you can get in the habit of countering that over breathing by doing your LILO breathing, you will feel a big difference and really set yourself up for a great night’s sleep.

Tara’s upcoming book called Is Your Sleep Making You Tired? walks you through all the things that may be impacting your sleep from the angle of nighttime breathing problems. 50% of men and 25% of women are affected by nighttime breathing problems, so many people just aren’t getting the sleep they need.

Tara has guides, articles, and quizzes for you and your family to read and to take. You can find these resources on her website at o2tara.org. Go visit her website and read her guides and articles and take a quiz to see if you need to take additional steps to eliminate your nighttime breathing issues.

Resources:

Transcript:

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Tara Clancy: [00:00:00] Train yourself to exclusively nose breathe even during exercise because you will see a dramatic increase in your performance.

Peter Margaritis: [00:00:18] Welcome to Change Your Mindset Podcast, formerly known as Improv is No Joke, where it’s all about believing that strong communication skills are the best way in delivering your technical accounting knowledge and growing your business. An effective way of building stronger communication skills is by embracing the principles of applied improvisation.

Peter Margaritis: [00:00:38] Your host is Peter Margaritis, CPA, a.k.a The Accidental Accountant. And he will interview financial professionals and business leaders to find their secret in building stronger relationships with their clients, customers, associates and peers, all the while growing their businesses. So, let’s start the show.

Peter Margaritis: [00:01:02] Welcome to Episode 40. And my guest today is Tara Clancy, who’s a speaker, author, and a sleep expert. Her upcoming book, Is Your Sleep Making You Tired?, will be available on Amazon in the spring of 2020. Tara is, also, a member of the National Speakers Association and currently serves as the President of the Connecticut Chapter. This episode is a must-listen to all CPAs and accountants who work in public accounting and in business and industry because of the upcoming increase in our demands as we enter 2020.

Peter Margaritis: [00:01:33] Tara has a lot of great tips and advice for us to think about during our day as it relates to our daytime and our nighttime breathing in order to get a good night’s sleep. She discusses the long-term ramifications of nighttime breathing issues and the effect it has on our bodies and on our brains. As you’ll hear during our conversation, Tara has guides, articles, and quizzes for you and your family to read and to take. You can find these resources on her website at O2tara.org. Go visit her website and read her guides and articles and take a quiz to see if you need to take additional steps to eliminate your nighttime breathing issues. I took one of these quizzes, and it appears that I have some nighttime breathing issues that I need to address.

Peter Margaritis: [00:02:22] Now, she does have an interesting article titled Sleep Apnea Victim: The Wicked Witch of the West, which is an interesting article seen at the movie, The Wizard of Oz, is playing during the upcoming holiday season. Tara talks about how you can tell that the Wicked Witch of the West had nighttime breathing issues based upon the shape of her face.

Peter Margaritis: [00:02:45] Before we get to the interview, Change Your Mindset is part of the C-suite family radio of podcasts. It’s an honor and a privilege to be amongst some of the more prevalent business podcasts, such as The Human Factor with Jeffrey Hayzlett, Amazing Business Radio with Shep Hyken, Keep Leading with Eddie Turner. You can find Change Your Mindset and many other outstanding business podcasts on C-Suite Radio by going to www.c-suiteradio.com. And you can find his podcast now on iHeart Radio.

Announcer: [00:03:14] This podcast is part of the C-Suite Radio Network: turning the volume up on business.

Peter Margaritis: [00:03:21] And now, word about the upcoming Santa Speedo Dash here in Central Ohio.

Cathy: [00:03:27] Hey, Anthony, what’s with the bells?

Anthony: [00:03:29] Hey, Cathy, I’m putting my outfit together for the Santa Speedo Dash.

Cathy: [00:03:33] Love of the red leggings too. So you’re going to run in the Santa Speedo Dash on Saturday, December 14th to support Camp Hamwi?

Anthony: [00:03:39] You betcha. Will you be there?

Cathy: [00:03:41] Of course. It’s the only day each year I’m allowed to wear a bathing suit to work.

Anthony: [00:03:45] Help us give kids with diabetes the experience of a lifetime. Proceeds from the Santa Speedo Dash support Camp Hamwi. Register or donate today at www.santaspeedodash.org.

Peter Margaritis: [00:03:59] And now, a word from our sponsor.

Sponsor: [00:04:01] This episode is sponsored by Peter A. Margaritis LLC, a.k.a. The Accidental Accountant. Are you looking for a high content and engaging speaker for your next conference? Do you want to deliver a story to stakeholders that will transform data dumping to engaging business conversations? Do you want to feel that the value a speaker provides your audience far exceeds the dollar value on their invoice? Then, book Peter for your next conference management retreat or workshop. Contact Peter at peter@petermargaritis.com and visit his website at www.petermargaritis.com By the way, one of his Fortune 50 clients actually made the comment about the value he brings to your audience.

Peter Margaritis: [00:04:49] Now, let’s get to the interview with Tara Clancy.

Peter Margaritis: [00:04:56] Excuse me. Welcome back, everybody. I apologize. I didn’t get home till late last night from a speaking engagement. And I didn’t—I’m sorry. I didn’t get enough sleep. And seriously, I am not saying that, but, luckily, my guest today, Tara Clancy, is a sleep expert. And she is going to talk to us about how to get better sleep, how to get the right sleep, how sleep is important in our daily lives. And if you think you can sleep when you’re dead, because I say that all the time, “I can sleep when I’m dead,” I think after listening to this episode, I already might be dead. So, first and foremost, Tara, thank you so very much for taking time out of your busy schedule to keep me awake and our audience awake as well.

Tara Clancy: [00:05:45] Thank you very much, Peter. I’m excited to be talking with you today.

Peter Margaritis: [00:05:49] So, how did you become the sleep expert?

Tara Clancy: [00:05:52] Well, you know how sometimes we have a happy accident. It turns out I realized that I had been dealing with a sleep problem for my whole life. And it was one of those, “Oh, my God. You’ve got to be kidding me,” moments. And then, it was also one of those, “Oh, my God. I’m so happy to get this information right now.” Sort of, I had a succession of trouble my whole life. There was always some new little thing that I was dealing with that just was either, you know, like a little health problems. I had sinus infections. And then next thing, I had asthma. And then, I had skin problems. And then, it was gut issues. And it was just this building of things that were kind of taking away my health and wellness.

Tara Clancy: [00:06:36] And then, after just by chance, I find out that it’s actually all related to a nighttime breathing problem. And so, it’s like, “Whoa, you know, not breathing at night, that’s pretty substantial.” And then—but then, the flip side of it was like, “Wow, if I—if that is the case, then maybe there is one problem here and not this multitude of little problems. And if it’s one problem, maybe I can actually really solve it.” And that is really how I got to here today. I’m a breathing specialist. And so, I was able to combine that work with a few other things to help me really get to the point of having the right kind of sleep.

Peter Margaritis: [00:07:20] You have some type—you have medical in your background. So, it wasn’t like you’re an engineer and went, “Okay, wait, you know, I can go down this path.” I mean, you do have that in your background, right?

Tara Clancy: [00:07:30] Well, so, I’m actually an educator. I’m a certified educator, diagnostician. And the reason I got the breathing specialty is for my own health originally to manage the asthma. So, it was just sort of by chance that I got—went and got this training for it. And I honestly, Peter, never connected the dots between the daytime breathing problems that I was having and the fact that I was just waking up exhausted all the time and feeling exhausted. And like I said, having this succession of small problems come my way.

Tara Clancy: [00:08:03] But what I realized is, is that it really is all about connecting the dots. And, you know, I loved the title of your podcast – it’s Change Your Mindset – because I think what happens is we have busy , right? We’re all—you know, we’re working, we’re developing our careers, we have unbelievable responsibilities coming our way, and sometimes ridiculous deadlines at work at different times of the year. And so, we get in these habits, and we feel less than we should, but we just chalk it up to the demands of life. And really, if we can change your mindsets and say, “You know what, it’s not just that we’re busy trying to live our lives,” but to say, “Maybe there’s something else driving all of this,” that’s when you can really start to get a better—to feel better if you start to look at it in a new way and start to say, “Maybe there’s something else going on here. Maybe it’s my sleep.”

Peter Margaritis: [00:08:58] So, how would I assess that? It’s my sleep that might be getting in the way because I might begin getting—well, I’m getting seven to eight hours of sleep at night. That should be suffice. And you mentioned about daytime breathing. How do I know if my breathing—I’m still alive. I’m still walking. So, I must be breathing fine. But apparently, I’m not. So, what kind of tips and hints that you can give my audience to—on these sides that you maybe need to look a little bit deeper?

Tara Clancy: [00:09:23] Yeah. So, I’m glad you mentioned the idea of getting seven to eight hours of sleep of night—at night and feeling like, “Okay, I can check sleep off the list,” because, you know, we’re all aware of sleep hygiene now largely, and we say, “As long as I’m getting the right amount, then I’m good.” But I was getting eight hours of sleep at night, and I was still waking up feeling tired, having to reach for that cup of coffee, to get the caffeine I was needing. I see you reaching for your cup of coffee. I needed a nap. I was the queen of the power nap. You know, I thought, “As long as I had that, I was good for the rest of the afternoon.”—

Tara Clancy: [00:10:06] And then, quite frankly, my adrenaline need kept increasing to the point that I took up rock climbing and needed the adrenaline of rock climbing to get going. And what I realized in hindsight is that so many of us, when is it, somewhere in our 30s and early 40s, how many people do you know that have—are training for a triathlon, or how many people have just finished their first Tough Mudder, you know? Why are we doing these sort of extreme sports? Really, if we step and look—step back and look at it, in many cases, it’s because we are really seeking the adrenaline that we need to keep us going because we’re not getting to sleep at night. So, any of those kinds of things could be a sort of red flag to say, “Let me look and see if maybe my sleep is not doing what it’s supposed to be doing for me.”

Tara Clancy: [00:10:55] Other things would include waking up in the middle of the night. Sometimes, especially if you think about for your audience, maybe the beginning of the year would be a particularly stressful time because they have so many increased demands for them.

Peter Margaritis: [00:11:11] Right.

Tara Clancy: [00:11:11] So, let’s say they fall asleep, and then they wake up at 2 o’clock in the morning, and their mind is racing, “Okay, what do I have for corporate tomorrow? What do I have for this account? What do I need to get done?” That waking up in the middle of the night, that’s another type of insomnia. And that is actually—research shows that that is often correlated with a nighttime breathing problem because, basically, what happens is new body knows that the brain is not getting a sufficient amount of oxygen when you’re sleeping. And so, it wakes you up and basically saying, “Hey, That sleep thing you were just doing was dangerous. Don’t do that again.” And that’s why you wake up, and then cannot fall asleep. So those are other signs too.

Tara Clancy: [00:11:53] Or if you wake up in the middle of the night to use the bathroom, that’s another sign as well, because your brain has to do its repairs at night, and it goes into a really deep phase to do that. When it does that, it sends out a chemical to the bladder to say, “Hey, you know, we’re not open for business. Don’t send me a signal that you’re full.” So, if you are indeed in what we call the deep, deep sleep, that chemical gets sent out, and you will not signal—you know, you will not get the signal that you need to go to sleep. If you are getting that signal, and you are having to get up to go to sleep—excuse me, to go to the bathroom, that means you’re not getting into that deep phase of sleep where your brain can do its repairs.

Peter Margaritis: [00:12:40] Well, I’ll check those two on my boxes because yes, I do wake up at 2:00 – 3:00 in the morning at time and go, “My God, my head’s full. I got to get this stuff done.” And yes, I do get up a lot of times in the middle of the night to go to the restroom and come back.” But in my case, when I wake up, and I have two dogs that tend to wake me up around 5:00 in the morning because they’re hungry, I can’t go back to sleep. Once I wake up on, my motor starts.

Tara Clancy: [00:13:07] Right. Well, to go—to shift to the breathing side of things, there is a breathing exercise that you can do that helps your body get out of the fight-or-flight mode because that’s when you’ve woken up, when you haven’t gotten enough sleep, and you wake up, you’re usually more in that fight-or-flight nervous system load. So, there’s a breathing exercise. I, actually, have it available on a download—as a download on my website. But this breathing exercise can help you go from fight-or-flight nervous system into rest-or-digest nervous system. In fact, I recommend doing this breathing exercise before you even go to sleep because it gets you into that rest-or-digest nervous system, and it gives you the best chance of having a really restful night of sleep, you know, to get to where you want to be.

Peter Margaritis: [00:13:58] So, you said this is a download on your website. Could you give the audience the URL for your website?

Tara Clancy: [00:14:03] It’s o2tara.org/talk. And that has a download that will tell you some of the common signs that you see because believe it or not, Peter, your facial shape is even a huge determinant in whether you’re going to sleep well at night. That’s a really involved conversation that we would have. We would need a much longer program to get into that. But there is information about that in the download for people that are wondering. And it also has the breathing exercises, as I mentioned. And it has a couple of diagnostic tools for some of the medical professionals that I work with. So, it could really give people a good sense of whether or not they may be showing the signs of a nighttime breathing problem.

Peter Margaritis: [00:14:47] So, before we started recording, we were talking, and this episode is being broadcast on October 28, just before Halloween. And you said that you recently wrote an article about the Wicked Witch of the West.

Tara Clancy: [00:15:01] Yes.

Peter Margaritis: [00:15:02] And she had some breathing issues. So, could you share that with everybody?

Tara Clancy: [00:15:05] Yeah. Yes. So, because what I’m trying to do is help people see that these nonmedical signs of a nighttime breathing problem and the Wicked Witch of the West, the actress who played her, with the name of Margaret Hamilton, if you look at her face, you can see all the signs of someone with a nighttime breathing problem. And it’s right on the—on my website. It walks you through the different signs. And the thing is, when you look at it—she has passed away, but if you look at how she died, it says that she had a heart attack in her sleep. And so, at first glance, you think, you know, maybe that’s not a bad way to go.

Peter Margaritis: [00:15:46] Yeah.

Tara Clancy: [00:15:47] But then, you realize she had actually developed Alzheimer’s disease years before. And we know now that Alzheimer’s disease and nighttime breathing problems go hand-in-hand. We used to think of it as people with Alzheimer’s disease and other other cognitive impairments develop sleep apnea but we, now, all the researchers really bearing out that it’s the reverse, that you have the nighttime breathing problems, and then you end up developing the cognitive impairment and the Alzheimer’s disease.

Tara Clancy: [00:16:20] So, when I’m doing a talk, Peter, inevitably, at this point, somebody will say, “Why? Why is that?” And here’s the reason. Because at night, when you get into that deep phase of sleep that we were talking about before, your brain literally shrinks down in size. And the reason it shrinks down in size is that it should be flushed out. There’s is cerebrospinal fluid that literally flushes out every nook and cranny in your brain. And so, if you are not getting into that deep phase of sleep, you never get those repairs. You know, you never get the housekeeping done. And what is the basis of cognitive impairment and Alzheimer’s disease? The little plaques, the proteins that builds up there. And so, we—if you don’t get that deep phase of sleep, well, your brain can get flushed out, you end up developing—you set the stage for developing cognitive impairment, Alzheimer’s disease later on.

Peter Margaritis: [00:17:15] Well, if you could see my face right now, it’s just, “Oh, my God,” or “Holy cow.” Never—that’s—so, if somebody—I have a friend who was diagnosed with, I guess, like a sleep apnea, and he had the CPAP. Am I using the right words?

Tara Clancy: [00:17:36] Yes, you are. Yes, absolutely.

Peter Margaritis: [00:17:39] And he told me, he goes, “You know, I never realized how poor sleep I was getting until I wore my CPAP machine, and I got the best night’s sleep I’ve ever had.”

Tara Clancy: [00:17:48] Yeah, that’s a very common sentiment. You don’t realize how worn down you’ve gotten because it’s been such a slow process. You know, our bodies are masterful at compensating. But at some point, you’re going to have to pay the piper. So, years, and years, and years go by and you—eventually, your body can’t compensate anymore. And it really gets at the idea, you know, you mentioned sleep apnea. Let’s just talk a little bit more broadly about that.

Tara Clancy: [00:18:18] So, when I talk about what they call in the literature sleep disorder breathing, I call it nighttime breathing problems, because that’s, you know, a much more non-medical, user friendly name. So, what does that mean? You’re having problems breathing at night, right? And sleep apnea would be the king of that nighttime breathing problem range because you actually stop breathing for certain amount of times, the number of times an hour, and then you get that diagnosis of sleep apnea. But there are other, you know, lesser forms of nighttime breathing problems that still are highly problematic.

Tara Clancy: [00:18:52] So, there’s something called upper airway resistance syndrome. Even basic snoring is a problem because you are—you have a disruption in air flow to the brain. And what’s the one thing your brain needs to continue functioning? Oxygen.

Peter Margaritis: [00:19:09] Oxygen.

Tara Clancy: [00:19:09] Right?

Peter Margaritis: [00:19:09] Right.

Tara Clancy: [00:19:09] And so, as soon as you have that disruption, you are stressing your brain in a way that you don’t want it to be stressed. And the problem, so you end up seeing that we don’t—we haven’t effectively connected the dots for the general public yet, but if you snore, and you—ultimately, we know now that anybody who snores will, at some point, down the line, ends up with sleep apnea. So-

Peter Margaritis: [00:19:37] Okay.

Tara Clancy: [00:19:37] … what I would like to do is say, “How about if we get this awareness now? If you are snoring, or if you’re just waking up, and you’re feeling tired, look at sleep and breathing during sleep as the possible problems because, then, you can, first of all, start to feel great again if you can backslide a problem. And then, also save yourself from ending up with sleep apnea down the road.”

Peter Margaritis: [00:20:02] Okay. So, let’s take a—go back to when you were talking about the download and this breathing exercise. Can you demonstrate via audio what this would entail? Just a piece of it. Just so the audience has an idea of what you’re—you know, when you’re talking about this breathing exercise?

Tara Clancy: [00:20:21] Sure, yeah. So, let me just step up—step back for a second and say why we have so many problems because that will explain why the breathing exercise work so much. So, the reason that so many of us have so many problems is because these nighttime breathing problems really get their start during the day, right? If you think about it, if you’re breathing for two-thirds of the day in a less than optimal way, it’s going to follow you into night because that’s your breathing pattern. But the reason it becomes more noticeable at night is because when you go to sleep, your muscles relax. And so, that, now, we call it the airway, any of the place where the air is getting in from your nose down into the lungs, if your airway is impacted in any way because of poor deep daytime breathing habits, when it relaxes at night, as it does when you’re sleeping, you problem is going to be magnified.

Tara Clancy: [00:21:16] So, let’s just—let me tell you first that the number one thing that people are doing that creates problems, mouth breathing, right? So, first of all, right now, you and I are mouth breathing as we’re talking. We all do it, right, because we have to. It would be odd to try to take in a breath through our nose when we’re speaking because, then, we’d sound all halted and all strange. But as soon as we start mouth breathing, we throw off the ratio of the gases in the blood. If you can just look at your nostrils compared to the size of your nose, I’m sorry, compared with your mouth to see how much more air you can take in through your mouth than you can in through your nose. So, once you start using your mouth for breathing, everything gets thrown off.

Tara Clancy: [00:22:02] You also end up getting inflammation when you mouth breathe because your nose does different things like filtering the air, warming the air, cleaning the air, all things like that, moistening the air. Our mouth can’t do that. So, we end up with inflammation at the back of our throat. And so, then, if you have inflammation, that means the airway is now going to be smaller. And then, when you go to sleep, muscles relax. You get that disrupted air flow.

Tara Clancy: [00:22:32] So, the goal of the breathing exercise is to undo some of that breathing, we call over breathing when you breathe through your mouth. So, the breathing exercise I call LILO breathing. And the LILO stands for less in, less often. So, if you spent your whole day over breathing, then you want to set yourself up at night by taking less in, less often, so that it compensates for what was happening all day. And again, it’s all described in there but, basically, you’re just taking in a smaller breath than you normally would. And then, you are waiting an extra moment before you take in that smaller breath. So, you take a little less in, and you do it a little less often. By doing that, you get yourself into the right nervous system mode, the rest or digests. And it also helps to rebalance the gases in the blood.

Tara Clancy: [00:23:30] There’s a really odd thing also about mouth breathing is the body senses that the air is escaping, not coming into the nose, and so it says, “Whoa! Whoa! Something’s going on,” and it actually creates mucus in the nose to block up this perceived loss of air. And how does increased mucus in the nose affect? It’s a stuffy nose. Then, you can’t breathe through your nose. So, you have to breathe through your mouth. So, it’s kind of like this catch 22. So, you know, I’m sure a lot of your listeners have to give presentations, and they have to speak to people all day. So, if they can get in the habit of countering that over breathing by doing this LILO breathing, they will feel a big difference. And especially if you do it right before you go to bed, you really set yourself up for a great night’s sleep as well.

Peter Margaritis: [00:24:24] So, we’re taking less in, less often, but we’re taking less into through our nose, and the exhales coming out of our mouth, right?

Tara Clancy: [00:24:32] No, no.

Peter Margaritis: [00:24:32] Oh, no.

Tara Clancy: [00:24:33] It’s always nose, yeah.

Peter Margaritis: [00:24:34] It’s always those. Okay.

Tara Clancy: [00:24:35] Yes. In yogic breathing, they often talk about inhalation to the nose and exhalation through the mouth. And my take on that is if you are a healthy breather, and you are breathing optimally, then that’s probably fine. But if you are over breathing, and a lot of it is just because of lifestyle for us. Like I said, you’re talking to people all day through your work. If you end up over breathing, then you don’t want to use your mouth, you know, for breathing any more than you absolutely have to. So, into the nose, out through the nose.

Peter Margaritis: [00:25:10] Well, as a speaker, as we both are both members of the National Speaker’s Association, then we should take note, all through the nose, nothing through the mouth because it’s how we make our living.

Tara Clancy: [00:25:21] As Speakers, you’re right. We do end up having to—we throw off our breathing all the time. We have to breathe through our mouths. And so, I do have that same breathing exercise where I refer to it as the speaker reset. So, any of your listeners, and I’m sure many of them have to speak to clients all the time, and they would want to do that too.

Tara Clancy: [00:25:42] Another thing, Peter, about mouth breathing, sometimes we’re just doing it by habit. We just keep our mouths open. So, we want to catch that. But even if you’re not, we have other times that we end up breathing through the mouth that really is not beneficial to us. And the biggest one is during exercise. You may have some of your listeners to get to the gym, and get on that treadmill, or they get out for a run, and you’re going along. You start feeling a little winded. So, your first thought is, “Let me breathe through my mouth.” But it’s actually the worst thing that actually can do. Train yourself to exclusively nose breathe even during exercise, because you will see a dramatic increase in your performance.

Tara Clancy: [00:26:21] I, actually, have a dentist that I interviewed for my book. He’s an airway dentist. I interviewed him for my book. And we were talking about breathing. He told me that he was a marathon—has been a marathon runner for 26 years. And for the first 16 years, he had no idea about the nasal breathing versus mouth breathing, and he would mouth breathe as he ran. Then, he found out about it and shifted to exclusive nasal breathing. And he said his marathon times have come out better in all these 10 years since finding out than any before, even though he was a much younger guy then. So, it really does make a difference.

Peter Margaritis: [00:26:57] Somebody did tell me that because I used to run, and my knees gave and said no more, but I bike. And when I bike, something hit me in the back of the head one day and said, “You need to breathe more through your nose than through your mouth.” So, every time I get on my bike, whether I’m doing 10, or 20 miles, whatever, I try to focus on breathing only through my nose. And it’s weird at first. It’s almost like, I’m about to throw myself all over the handlebars or something. But after you get into the habit of it, it becomes much more natural, but it’s strange, really strange, at first.

Tara Clancy: [00:27:30] Right, right. But it’s it’s great. I’m so glad to hear you say that because that’s exactly it. And then, some people say too, like, there’s definitely an adjustment period. And people will say, “I can’t. I’m not getting enough air. So, I have to breathe through my mouth.” And that is the short-term tradeoff. In the beginning, when you are switching to nose breathing exclusively, you will have to pull back a little bit.

Peter Margaritis: [00:27:52] Yeah.

Tara Clancy: [00:27:53] But then you’ll see a dramatic increase in what you can do. Here’s the reason why it makes sense to people. We often think of carbon dioxide in the body as a waste gas, right? It’s just something we exhale when we’ve—after we breathe in. But we actually know now that it isn’t. Carbon dioxide serves a really important feature. Think of it like a debit card. You know, if you go to a bank, and you have, you know, $25,000 in there, and you want to get something out, if you don’t have your—you know, you go to the ATM machine, right? If you don’t have your debit card, you can have all the money in the world in that bank, but you can’t get it out because you need the card to allow you to do that transaction.

Peter Margaritis: [00:28:38] Right, right.

Tara Clancy: [00:28:38] Well, carbon dioxide is the same way. We have all this oxygen in the blood that we’re taking in as we breathe. It is the carbon dioxide that allows the oxygen to be released into the muscles where we need it when we’re exercising. So, if we are breathing into our mouths, we are getting less carbon dioxide builds up, and we cannot release that oxygen into the muscles. So, it’s a real catch 22. You’re breathing into the mouth because you feel like you need more, but it’s actually not allowing you to access what you’re taking in. So, again, it’s a tough transition period at first, and you’ll need to pull back, and maybe run a little slower, or bite a little slower just to stay at the point where you can exclusively breathe through the nose, but then you will adjust, and you will feel the increased benefits. So, I definitely recommend it.

Peter Margaritis: [00:29:32] Oh, my God. I’ve got some work to do on my end. And as we begin to wrap up, you mentioned something, and you can just let it out there, but you didn’t—you’ve got a book coming out. You said you’ve interviewed this dentist for your book. So, tell us about your book and when you expect it to be out.

Tara Clancy: [00:29:48] Sure, yeah. My book is called Is Your Sleep Making You Tired? And I don’t—it does get people laughing, but it’s like we said before, people don’t think of sleep as the problem because we’re like, “You know, sleep hygiene is good. Check that off.” And what it really does is walk you through all the things that may be impacting your sleep from the angle of nighttime breathing problems because, believe it or not, I think we mentioned this, 50% of men and 25% of women are affected by nighttime breathing problems. And of course, if you happen to be a woman who’s sleeping next to a man who is affected, well, then you have a nighttime breathing problem by location. So, a lot of people are not getting the sleep that they need.

Tara Clancy: [00:30:32] So, my book is meant to really help get this on people’s radars, to get them to really change their mindset and say, “Hey, maybe this isn’t just lifestyle. Maybe there’s a problem here that I can actually fix, and really feel the way that I want to have the health and wellness that I’m hoping to have at this point.” And then, I have a quiz in there. I have a quiz on my website too actually if you want to look at that. And then, I also have treatment plans because you’ll come out in different places on that nighttime breathing problem scale. And so, I have different treatment plans according to where you might come out. And that’s really the book. And it’s scheduled for April—sorry, spring of 2020.

Peter Margaritis: [00:31:15] Okay. So, spring of 2020, her book will hopefully be out, and it will be available on Amazon.

Tara Clancy: [00:31:20] Correct.

Peter Margaritis: [00:31:21] And if you can send me some information when it does come out, I’ll make sure to create it. We’ll create a little commercial to help promote it because I think it’s something that I’m going to pick up, I’m going to read. I think it’s something everybody should read. And before we let you go, give everybody the website again and how they can contact you.

Tara Clancy: [00:31:43] Sure. It’s o2tara.org. And on all social media, I am @02taraclancy.

Peter Margaritis: [00:31:51] Great. So, go visit her Web site. I’ve been through a website. I’m going back and downloading the breathing tips and how to do that nighttime breathing because I wasn’t kidding, I didn’t get in till late last night, and this morning, I am pretty tired. It’s ironic that, you know, I get Tara as my guest today. But she’s opened my eyes, and I hope she’s opened all of your eyes. And thank you very much, Tara, for taking time out of your schedule. I look forward to our paths crossing, hopefully, very soon.

Tara Clancy: [00:32:18] Me too. Thank you so much, Peter.

Peter Margaritis: [00:32:22] I hope you enjoyed Tara’s interview and that you visit our website and learn more about nighttime sleeping issues. This is a very important issue to explore, and I plan on having Tara back on my podcast once her book comes out. Thank you for listening. And if you’re enjoying this podcast, please subscribe and share this episode with a friend. Make today your best day.

Announcer: [00:32:49] Like what you just heard? Because it’s c-suiteradio.com. C-Suite Radio: turning the volume up on business.

S2E39. Raising Self-Esteem Through Improv Techniques with Eileen Kahana

Eileen Kahana is the Founder and CEO of a Chicago nonprofit, Room to Improv, a non-profit dedicated to raising the self-esteem of students, veterans, and seniors, and, ultimately, empowering them to enrich their lives. It teaches them how to explore, embrace, and adopt the techniques of improvisation into everyday living in order to motivate individuals to care about themselves and others, make healthy choices, effective decisions, and use their confidence to overcome their fears.

Improv had always been a part of Eileen, but it was only recently that she discovered its name and process. After retiring from an accomplished career as a teacher and mentor from the Chicago Public School System, Eileen challenged herself to take an improv class at the Second City. That one class turned into a two-year, life-changing experience, and inspired her to create Room2Improv. The more she took, the more she realized that everyone needed an improv class. And she realized that this is what Chicago Public School children need.

She thought about all the things improv can bring to people: confidence, being in the moment, public speaking, team building, supporting your partner, and being in a place where everything you say and do is correct. These were all things students needed. We raise kids at home and at school constantly telling them “no” and what they are doing wrong. Why would anybody want to be in an environment that is not supportive? Improv was an environment needed in school.

Eileen started this nonprofit, Room2Improv, that’s dedicated to raising the self-esteem of students and, ultimately, empowering them to live enriching lives. Her goal is to make improv available to those who wouldn’t think to do it and to those who can’t afford it.

There can be a lot of pushback about introducing improv in schools, though. Besides the misunderstanding that improv is just comedy, and that it’s not important, there is the issue of budgets. The arts are continuously being cut across the board, not just in Chicago, but in many school systems. But this is so important, because a well-rounded student needs the arts.

No matter what neighborhood or school, the needs are the same. Students have a human need for confidence, which motivates people to care about themselves. And once you care about yourselves, it trickles down into caring for others. It’s the fundamental human need of being validated, encouraged, and accepted.

The goal of Room2Improv is to make improv available to everyone. To make this possible, to give space to visit schools who don’t have the budget to spend on the arts, they rely on donations and fundraisers to give access to as many people as possible.

Please visit room2improv.com. There are some great videos there talking about their mission and some of their accomplishments. If you keep scrolling down, there’s an area for giving. If you feel compelled to do so, please consider donating. This is a cause that is making a huge difference in children and in the military. Let’s help Eileen reach this goal of bringing improv to as many people as possible.

Resources:

Transcript:

Click to download the full Transcript PDF.

Eileen Kahana: [00:00:00] When you have self-confidence and good self-esteem, you’re not going to allow anyone to bully you, and you don’t need to be a bully.
Peter Margaritis: [00:00:20] Welcome to Change Your Mindset Podcast, formerly known as Improv Is No Joke, where it’s all about believing that strong communication skills are the best way in delivering your technical accounting knowledge and growing your business. An effective way of building stronger communication skills is by embracing the principles of applied improvisation. Your host is Peter Margaritis, CPA, a.k.a. The Accidental Accountant. And he will interview financial professionals and business leaders to find their secret in building stronger relationships with their clients, customers, associates, and peers all the while growing their businesses. So, let’s start the show.
Peter Margaritis: [00:01:05] Welcome to Episode 39. And my very special guest today is Eileen Kahana, who’s the Founder and CEO of a Chicago nonprofit, Room to Improv. After retiring from an accomplished career as a teacher and mentor from the Chicago Public School System, Eileen challenged yourself to take an improv class at the Second City. That one class turned into a two-year, life-changing experience, and inspired her to create Room2Improv.
Peter Margaritis: [00:01:33] Now, the mission of Room2Improv is dedicated to raising the self-esteem of students, veterans, and seniors, and, ultimately, empowering them to enrich their lives. By teaching them how to explore, embrace, and adopt the techniques of improvisation into everyday living, we motivate individuals to care about themselves and others, make healthy choices, and effective decisions, and use their confidence to overcome their fears.
Peter Margaritis: [00:02:00] I met Eileen this summer when attending a two-day improv workshop in Chicago taught by Jay Sukow. Now, Jay has been a guest on this podcast before and was Eileen’s first improv instructor at the Second City. And as part of Room2Improv’s team, he is Eileen’s improv mentor. Also, Annie Conderacci, who’s also been a guest on my podcast, sits on the board of Room2Improv. The more I learned
about the outstanding work she does, I had to have her on my podcast, so she could share her story and mission with you, my audience.
Peter Margaritis: [00:02:34] After you listen to this episode, and you feel compelled to donate to Room2Improv, please go to www.room2improv.com, and scroll down to the gift section, and donate whatever you can to this wonderful cause.
Peter Margaritis: [00:02:50] Now, before you get to the interview, Change Your Mindset is part of the C-Suite family radio of podcasts. It’s an honor and a privilege to be amongst some of the more prevalent business podcasts, such as The Hero Fact with Jeffrey Hayzlett, Amazing Business Radio with Shep Hyken, and Keep Leading with Eddie Turner. You can find Change Your Mindset and many other outstanding business podcasts on C-Suite Radio by going to www.c-suiteradio.com. And you can also listen to this episode now on iHeart Radio.
Announcer: [00:03:20] This podcast is part of the C-suite Radio Network: Turning the volume up on business.
Peter Margaritis: [00:03:27] Now, a word from our sponsor.
Sponsor: [00:03:30] This episode is sponsored by Peter A. Margaritis LLC, a.k.a. The Accidental Accountant. Are you looking for a high-content and engaging speaker for your next conference? Do you want to deliver a story to stakeholders that will transform data dumping to engaging business conversations? Do you want to feel that the value a speaker provides your audience far exceeds the dollar value on their invoice? Then, book Peter for your next conference, management retreat, or workshop. Contact Peter at peter@petermargaritis.com and visit his website at www.petermargaritis.com. By the way, one of his Fortune 50 clients actually made the comment about the value he brings to your audience.
Peter Margaritis: [00:04:19] Now, let’s get to the interview with Eileen Kahana.
Peter Margaritis: [00:04:25] Hey, welcome back, everybody. I’m very excited about my guest today, Eileen Kahana. I met her—up to taping of this, I met her about a month, a little over a month ago. I attended a two-day improv improper intensive workshop in Chicago. And I met Eileen, and she has such a wonderful story that I had to have her as a guest on this podcast. First and foremost, Eileen, thank you very much for taking time to be part of this podcast. I’m so looking forward to our conversation.
Eileen Kahana: [00:04:56] Thank you, Peter, for inviting me. I’m looking forward for this opportunity as well.
Peter Margaritis: [00:05:03] So, I have to ask this question first, right off the bat, how does a former teacher in the Chicago Public School System create this wonderful not-for-profit, Room2Improv?
Eileen Kahana: [00:05:18] It’s a great question. I wish the answer were simple or short. Let’s put it that way. The answer is simple. Improv has always been my way of being. And only recently did I discover its name and its process. So, my career ended unexpectedly. The Chicago Public School System decided that I was no longer beneficial for their needs, and I wanted to go out on top of my career. So, I-
Peter Margaritis: [00:05:56] Okay.
Eileen Kahana: [00:05:56] I resigned. I retired. I did not resign. I retired. And I wasn’t ready for a rocking chair or knitting needles. And I challenged myself, as I have my entire life to learn new things, and I decided to take one class at world-famous Second City in Chicago. And that was my intention, take one class and move on. And then, maybe go do piano lessons or something else. And that one class turned into a two-and-a-half-year, life-changing situation. The more I took, the more I realized that everyone needed an improv class. The more I took, the more I realized that this is what Chicago Public School children need.
Eileen Kahana: [00:06:59] Being involved with the system, every two years, there were new initiatives. How can we make Johnny stay in school? How can we get him better
grades, better attendance, whatever? And they would spend millions, and millions, and millions of dollars on these initiatives. And it took any teacher an entire year to figure it out. By May, we finally got this new system. And then, in September, they said, “Forget what we did last year. We’re starting all over. [Crosstalk].”
Peter Margaritis: [00:07:38] Jeez.
Eileen Kahana: [00:07:38] And so, I saw millions, and millions, and millions of dollars wasted. And then, I thought about improv, how its confidence, and being in the moment, and public speaking, and team building, and support your partner, and being in a place where everything you say and do is correct, I said, “That’s what students need.” They leave home after their moms told them, “No, no, no, no.” They get to school and all they hear is, “No, no, no, no.” And why would anybody want to be in an environment that is not supportive? So, I thought improv was an environment needed in school. So, where—I started this nonprofit that’s dedicated to raising the self-esteem of students and, ultimately, empower them to live enriching lives. I want to make improv available to those who wouldn’t think to do it and to those who can’t afford it. That was my goal.
Peter Margaritis: [00:08:47] And thank you for doing this. Clearly, I get it. And the person that you took this improv class, Jay Sukow, is also the instructor that we attended in Chicago. But I’ve interviewed him before on this podcast. And he’s always said, “If everybody would just take one improv class, the world would be a better place.”
Eileen Kahana: [00:09:13] Agreed.
Peter Margaritis: [00:09:14] And that’s—you know, people kind of look at it, “Okay, that’s kind of pie in the sky,” but that’s dead on. If everybody just took one improv class, and just learned the simple basic skills, and apply them every single day, the world would be a much better place.
Eileen Kahana: [00:09:28] Right. I agree with that. It’s a mindset. It is such a positive, welcoming environment that—I mean, I marketed to schools as bully busting.
Peter Margaritis: [00:09:44] Nice.
Eileen Kahana: [00:09:45] Because when you have self-confidence and good self-esteem, you’re not going to allow anyone to bully you, and you don’t need to be a bully. And it works.
Peter Margaritis: [00:10:02] You’re right. And I would imagine, it’s tough to get this into the school system, into the classroom, because my interactions is when I introduce improv out into the business world, I hear, “I don’t—I’m not—I don’t want to be funny.” I say, “This has nothing to do about being funny. This has everything to do with the confidence, and having a positive outlook, and moving things in a positive direction by using the two magic words – yes and.” Do you get much pushback from schools?
Eileen Kahana: [00:10:32] I get a lot of pushback from schools for the reasons you just mentioned and, unfortunately, money. They don’t have the money to have the programs. And the arts are continuously being cut across the board, not just Chicago, but in so many school systems. And that, to me, is the saddest possible. I mean, a well-rounded student needs the arts. Yes, it’s a hard sell because of what you said with the, “Oh, I don’t want to be funny,” or “I’m not funny.” And I, again, talk about the bully busting and what improv really promotes, which is the fundamental needs of humans of being validated, encouraged, and accepted. And once Johnny, the student, feels that, he’ll show up, and he’ll be there regularly. And once he starts liking himself, he’ll learn how to like others. And I just know children. I mean, I have a passion for education. I have a passion for accelerating the effectiveness of teaching. And this is the way to do it. Period.
Peter Margaritis: [00:12:22] Okay. Now, I’ve got goose bumps. I literally have—I really have goose bumps because I feel that passion coming through this conversation. And being a a believer, you’re spot on. And it’s just getting past that mindset that it’s, you know, we don’t bring funny here, or this is a serious situation. Improv is serious. I mean, it’s very—it’s very—it’s easy. It’s kind of laid back to some degree, you know, but there’s a very serious side to this because when you apply it in the manner that you’ve described, it helps with self—like you said, self-esteem, confidence.
Peter Margaritis: [00:13:08] And it’s interesting that we’re having this conversation because last night, I was having a conversation with Annie Conderacci, who is on your board, while I was in Chicago. And we both said the same thing. When we have gotten away from that almost daily dose or weekly dose of improv, we find ourselves transitioning back to—transitioning away from it, not having it in the forefront. But when we keep it in our lives as constant as we can, we see how we show up differently. We see how our lives, how we embrace every single day in a much different, more positive manner than we ever have before and even before the introduction to improv. And along the same lines, you talk to students about this, but you also talk to more than just students. You talk to veterans.
Eileen Kahana: [00:13:57] Correct.
Peter Margaritis: [00:13:59] And I’m trying to remember the other audiences. Well, you’ve got veterans, you’ve got seniors, you get the faculty members.
Eileen Kahana: [00:14:08] It sounds like I’ve got everybody covered.
Peter Margaritis: [00:14:11] Actually, the only part that you don’t have covered is the extreme youth from 0 to 9. Outside of that, I think you do have everybody else covered.
Eileen Kahana: [00:14:22] Yeah, I’m about effectiveness, about quality over quantity.
Peter Margaritis: [00:14:29] Yeah.
Eileen Kahana: [00:14:29] I want to make sure that, at least, by the age of 10, that’s our minimum age, although we have gone into classes of third and fourth graders, and they just love it. I mean, part of what they love, and any educator will tell you this, is that when the kids are having fun, or when the kids are learning and having fun, they don’t realize they’re learning.
Peter Margaritis: [00:14:58] Right.
Eileen Kahana: [00:14:59] And so, the tools of improv and the way of teaching improv is such a fun way of learning/living that you promote it to go home and tell your moms and dads what happened today. And hopefully, you tell two friends, and so on, and so on, and so on. And it becomes the mindset and the way of living. I mean, we have been fortunate enough to go into very diverse geographical neighborhoods where all of them have been quite different, and their needs are all the same. I don’t care what neighborhood we’ve gone to, what school we’ve gone to, the needs are the same. It’s the human need. I just have a passionate belief in building of self-esteem to develop people’s confidence, which just motivates people to care about themselves. And once you care about yourselves, it trickles down into caring for others. And think about like what Jay Sukow has quoted, how the world would be better. It’s that simple.
Peter Margaritis: [00:16:35] It is. And it’s hard.
Eileen Kahana: [00:16:37] Correct, correct.
Peter Margaritis: [00:16:38] Because—and the conversations we’re having before we start recording, you said something about the five Ns.
Eileen Kahana: [00:16:46] Yeah. I mean, I believe or I try and practice to eliminate the five negative words in my vocabulary – the no, not, never, none, nothing. And that includes contractions.
Peter Margaritis: [00:17:12] And we could put the word “but” there as well because that’s a negative word.
Eileen Kahana: [00:17:17] Well, the minute you say “but,” you negate the first part of the sentence. For instance, as my students would say, “I did my homework, but I left it at home.” So, I say to them, “Keep your but. I have my own.”
Peter Margaritis: [00:17:38] I love that. And how would they reply back to that?
Eileen Kahana: [00:17:50] I always got a laugh. Yeah. They—you know, we’re on the same page. I always made sure in my classroom that there was fun on a regular basis. I do believe everything is about the teacher and the relationship that she or he builds with their student. Teaching will only happen once there is a relationship. And that philosophy and that mantra goes with life, goes with improv, goes with anything. Everything is about relationships – everything. And in order to have that happen, you have to have your self-confidence, and you have to be a team player.
Peter Margaritis: [00:18:47] And I think a big word is that in order to have that relationship, there has to be a level of trust.
Eileen Kahana: [00:18:57] Yes.
Peter Margaritis: [00:18:58] And that’s one of the aspects that when I look at—when I teach improv, what I call the foundation. And one of the foundation blocks is trust. And there’s a quote that I used [indiscernible] David Horsager, who wrote the book, Trust Edge, “Everything of value is built on trust.” The lack of trust is the biggest expense organizations, people, whatever, incur. Once we lose that trust, it takes a long time to get it back. And improv is based off and relationships are based off of the ability to maintain trust and be trustworthy.
Eileen Kahana: [00:19:36] Correct. I agree with that. That’s a quote that should go up in everybody’s office.
Peter Margaritis: [00:19:43] Absolutely.
Eileen Kahana: [00:19:44] I mean, think about the trust and, again, the relationship when—we don’t even have to take the classroom. We can take an office environment. When an employee goes up to his boss and says, “I’ve got this great idea that I think would help our organization,” and the boss knocks it down, says no.
Peter Margaritis: [00:20:12] Yeah.
Eileen Kahana: [00:20:12] So, why would I want to work hard for you? Why would I want to work more for you if I’m always going to be shut down? And there are ways—and it’s the same thing in the classroom. When Johnny raises his hand, and he knows the answer or thinks he knows the answer to something, and he’s wrong, and the teacher goes, “No,” why would he want to participate again? It’s so important to encourage and accept the ideas, the answers, the input to help motivate and build that self-esteem in your organization, in your classroom, in your business, in your life, in your relationship with your spouse, with your children, with friends, with everybody who likes to feel good about themselves.
Peter Margaritis: [00:21:17] So, when I am listening to you say that, I’m going, “Okay. So, what gets in the way when the boss says no?” And that’s basically-
Eileen Kahana: [00:21:27] Power.
Peter Margaritis: [00:21:27] The power, the ego.
Eileen Kahana: [00:21:29] Yeah.
Peter Margaritis: [00:21:29] And improv is all about, you know, basically putting your ego aside.
Eileen Kahana: [00:21:33] Right.
Peter Margaritis: [00:21:34] And in a conversation I had recently with Jay, it’s like improv is all about deferring judgment.
Eileen Kahana: [00:21:41] Correct.
Peter Margaritis: [00:21:41] And there’s no such thing as a mistake. It’s a gift. And we shouldn’t punish for that. We should praise that, “Okay. So, what did you learn? How are you going to do this differently?” or “How do you perceive this differently now that this didn’t work?” versus having that punitive effect by saying, “No, that was wrong.” It
just stops conversation. And if people can just set their egos aside, and defer judgment, and and fill that basic human need of listening to other people, which shows appreciation, just morale should never really be bad.
Eileen Kahana: [00:22:26] Sounds great. It sounds like the perfect world.
Peter Margaritis: [00:22:30] And I caught myself that time. And it is hard to do because other factors tend to get in the way.
Eileen Kahana: [00:22:37] Because everyone needs to be aware of the value of improv.
Peter Margaritis: [00:22:46] And that’s what I love about what you are doing because you’re introducing this at a school level, at a youth level. And by introducing this power of improv and the positive effects it have at this youth level, it’s almost like I can’t wait until they grow up. I can’t wait until they’re out of college, and they’re running businesses and stuff, and see how that all morphs itself and change if they’ve maintained that improv muscle over the years.
Eileen Kahana: [00:23:20] Thank you. Thank you for recognizing that. I am very proud of the lives changing and making a difference to those schools, and children, and veterans, and seniors who I’m able to touch and, hopefully, you know, increase those numbers. And I’m so proud. I’m really very, very proud of where we’ve come from, where we’ve gone, how we’ve grown. And. If it stays where it stays, I’m so aware of the difference that has been made. I don’t know. The Beatles called theirs a Magical Mystery Tour. I call mine an Incredible, Intoxicating, Improv Journey.
Peter Margaritis: [00:24:17] Oh, I love that.
Eileen Kahana: [00:24:19] And it is intoxicating. I just want to get the word out there. And I appreciate you giving me the opportunity to help grow our opportunity to be in more schools.
Peter Margaritis: [00:24:37] You had me at hello when you were explaining to me in Chicago what you’re doing. And I came back home, and I was bouncing all over the place, (1), because of the two days; and (2), I tell my wife, “I met this incredible woman,” and I started explaining. And I’ll say, “By the way, I got the shirt,” which I’m wearing right now. And I’m just like all over the place. She’ll go, “Would you slow down? Take a breath and tell me about Room2Improv.” And I did. And she kind of—actually, I mentioned this before we got started recording, this has always been at the back of my mind, this is why I’m so passionate about what you do, because I have that same passion.
Peter Margaritis: [00:25:21] And she saw that in my eye and said, ‘You’re thinking about it again, aren’t you?” And I said, “Absolutely.” I said, “Not right now,” but you helped replant that seed in my mind because I believe, and I believe you’re making a huge difference, you’re absolutely making a huge difference in the Chicago area, and I want to make a huge difference in the Ohio, the Columbus area. Right now, I’m trying to make a huge difference in the corporate world. But eventually, I want to bring that down to the starting point, children, and having an impact on their lives, do something as intoxicating and magical as improv is.
Eileen Kahana: [00:26:03] Wow! I’m on your team.
Peter Margaritis: [00:26:07] But one question I have is, how all—when did you—what year did you start this?
Eileen Kahana: [00:26:11] It is five-and-a-half years old.
Peter Margaritis: [00:26:16] Okay.
Eileen Kahana: [00:26:17] And we have reached over 400 students in over seven different communities. We are not just based in the Chicago school system, but we have gone to neighboring suburbs and, also, in Chicago area of the Great Lakes Naval Base. We have been fortunate to work with, not veterans, but military men and women currently. And they just loved it. They just love the opportunity to feel supported, and
understood, and validated, which I believe our country needs to improve on how we treat our military and our veterans. And let’s not be political here.
Peter Margaritis: [00:27:21] Right, yeah. But you’re right, we do need. You know, when I—in my travels, if I see someone in uniform, or I hear that someone has served, I always thank them for their service.
Eileen Kahana: [00:27:31] Exactly, yeah.
Peter Margaritis: [00:27:32] And—but—so, you’ve done work for the military, which just in that essence, when we think of the military, we don’t think—they’re not trying to be funny. If there’s ever an example of an organization that really doesn’t want to be funny, but they’re bringing you in, and they’re embracing this concept, and embracing this improv as more than being funny, that right there is a bedrock. That is—well, if the US military is using us, why can’t you?
Eileen Kahana: [00:28:04] Right. I mean, think about it, who more than veterans need self-esteem, and confidence, and team building, and feeling validated, and appreciated.
Peter Margaritis: [00:28:19] I have some family members who are in the military, and I’ve had an uncle is a retired colonel. And he did a few tours, who flew jets for the Air Force, did a few tours in Vietnam. And coming back to the States at that point time, I mean, we know how rough it was. And I assume, I’m making this assumption, that some of these veterans that you are working with may have served during this period of time.
Eileen Kahana: [00:28:44] Correct.
Peter Margaritis: [00:28:45] Yeah. And it’s a wonderful work that you’re doing with the veterans because without them, this country wouldn’t look like the way it is.
Eileen Kahana: [00:28:55] Exactly.
Peter Margaritis: [00:28:56] We would—you know. As my uncle said, you know, “We have our freedom, but it’s not free. There’s a cost.”
Eileen Kahana: [00:29:01] Exactly, right.
Peter Margaritis: [00:29:03] There’s a cost to it. A lot of people have given for a greater cause in order for our freedom. So-
Eileen Kahana: [00:29:12] We also do classes for a nonprofit organization called Kids Rank. And they are all military children.
Peter Margaritis: [00:29:25] Oh!
Eileen Kahana: [00:29:26] So, for instance, the average age or the youngest age is 10. And last year, that 10-year-old was already in his Seventh City.
Peter Margaritis: [00:29:38] Oh, wow!
Eileen Kahana: [00:29:38] So. these kids don’t feel belonging anywhere, or at home anywhere, or always an outsider. So, this fabulous woman started this nonprofit called Kids Rank. I found out about it. And I said, “You guys need us.” And so, we’ve been working together, and we provide classes for them. And that is, usually, on a military base in the Chicago area, which has been awesome. The kids love it. And if you go to the website, under testimonials, or you’ll hear all of the kids, not all of them, but, obviously, you will see some great feedback that it makes—it’s a very feel-good result.
Peter Margaritis: [00:30:44] You know, I never thought about that, the military children. And my uncle was stationed in a lot of different places over his career and the family was there. And even to the point being overseas for a number of years. And if improv could help anybody—I mean, you have to assimilate and adapt a lot-
Eileen Kahana: [00:31:10] Exactly.
Peter Margaritis: [00:31:10] … a lot quicker than those who don’t have that situation. And if you don’t have an ability to do it, that—those times can be very stressful.
Eileen Kahana: [00:31:19] Right. And it can cause depression or lead to a lot of negative behavior.
Peter Margaritis: [00:31:27] Right. Because I’m leaving my friends. I’m leaving this area that I love to go to another place. And this is the seventh time I’ve moved in. We’re just-
Eileen Kahana: [00:31:37] And I’m 10.
Peter Margaritis: [00:31:39] And I’m 10, yeah.
Eileen Kahana: [00:31:39] Yeah.
Peter Margaritis: [00:31:40] Yeah. Well, let them ask you this question, and we’ll take a phone from the school perspective. You mentioned earlier in the interview that, you know, some schools don’t have the budget to have you guys come in. Let me ask. So, the question is, is all of your resources, your financial resources, coming from the ability for schools, or the military, or whoever to pay for you to come in, or do you have other means of raising money?
Eileen Kahana: [00:32:10] Great question. So, because schools don’t have money is not the reason we don’t go, okay?
Peter Margaritis: [00:32:18] Okay.
Eileen Kahana: [00:32:18] We do have fundraisers. We do have people who understand this. We’ve had many donations. I’ll go into a school for free. I’m about making improv available to everyone. That’s usually what nonprofits want to do. I’m not about making money or getting the money. I’m about getting the message out. But we get a no from a school because of a time constraint. There is no time for this, or it’s not
important, or they don’t understand, or they’re cutting the arts, or all kinds of reasons. The money is the last answer because I don’t want your money. I don’t need the school’s money. Would it be nice? Would it be nice if they have it, and they gave it to us, and we can, you know, then go into another school that doesn’t have it? Yeah, it opens up opportunities for us to other schools.
Eileen Kahana: [00:33:26] You know, there are schools that have more money than others. There is an inequity in budgets across the system. And if a school says, “We can pay,” I’ll accept it. And with that, I’ll be able to go to a school that cannot pay. And I hope I answered your question. Yes, we do fundraising. Yes, we take donations. Yes, if you want implants at your school or at your professional development for teachers to learn how to get along with one another, to learn how to support one another, we will come and do a professional development workshop for you. We can come and do a team building corporate workshop for you if you’d like to. The goal is to get the message of improv out, because once you get the message of improv out, you have a better world.
Peter Margaritis: [00:34:34] Absolutely. And the reason why I asked the question the way I did, I believe my—every now and then, my accountant had jumped on top of my head, and I’m sitting there going, “Okay. You’ve got a great cause. I want you to be heard. But also, it takes financial resources to keep the organization moving forward, and running, and doing the good that it has.” And yes, you’ll go in and do free, but you still have to have some cash flow in order to-
Eileen Kahana: [00:35:05] Of course.
Peter Margaritis: [00:35:05] … sustain the business.
Eileen Kahana: [00:35:07] Correct,
Peter Margaritis: [00:35:08] And I’ve gone to the website. I’ve wanted to just, (1), the website is room2improv.com. And scroll down, read through. There’s great videos on there. There’s Eileen talking about a campaign. There’s the military. There’s a video of
Hope Manor talking to veterans. But if you keep going down there’s an area for giving. And it’s a Go Fund Me page that says donate. If you’re listening to this, I would love if you would just take a moment, and go to the website, and donate, 10 bucks, 50 bucks, 100 bucks. This is a cause that is making a huge difference in children and in the military. And let’s help Eileen reach this goal of bringing improv to as many people as possible. I just—I love this. You can probably tell by my voice. I’m very passionate about what you are doing, and I want you to succeed far beyond your wildest dreams. And whatever I can do to help you do that, you know how to find me, and the answer will be yes. And now I have to tell my wife, but that’s okay. But that’s okay. But you know, she understands my passion as well. And I understand her passions. I love what you do. I’m blessed that I got to meet you.
Eileen Kahana: [00:36:42] Thank you. And I feel the same.
Peter Margaritis: [00:36:43] It was so much fun getting to know you and watching you on stage. And you know, I’m somewhat—I’m not—a complete novice, but I’m nowhere near some of the levels that folks were performing at that intensive weekend.
Eileen Kahana: [00:37:01] Right. I feel the same.
Peter Margaritis: [00:37:04] But the cool thing about—this goes to improv, but the cool thing about it, none of them ever looked down at us and said, “What are you doing here?” Everybody was so supportive in so many different ways. It just, you know, you walk into a place, and there’s this huge fear that I don’t know anybody. Am I doing things wrong? What are people thinking? That never came across my mind at all because the environment was never set in that manner. It was set in such an inclusive way.
Eileen Kahana: [00:37:34] I agree. And I have to go back to my statement made earlier that everything is about the teacher. Everything. I mean, I walked in there, I signed up for the class because of Jay, and I knew that my improv skills would be honed and needed to be. You know, I started hearing myself say no a little bit too much. And when I walked in, and after 10 minutes, I realized, “Whoa, this is not for rookies. This is a
professional workshop.” And there is a level of comfort, whether it’s day one or your 20th year that—you’re right, everybody made everyone feel welcome. And Jay made everyone feel on the same level.
Peter Margaritis: [00:38:38] Yeah. Yeah.
Eileen Kahana: [00:38:41] And he’s the best.
Peter Margaritis: [00:38:44] Okay. We got this Jay Sukow love train right now. But yes, he is the best. And I enjoy working with them, actually. He’s helping me with some of the stuff in my business now. And we’re considering—well, we’ve come into agreement. We just need to move forward with a little bit more of co-authoring a book together, having improv with the aim or the audience being the C-suite. I hope that this time next year, we would be very close to having that book completed and out. And just the opportunity to work with him in that manner, I’m giddy would be an understatement. But he’s got a great message. He’s got a great way about him. And he’s—as Eddie said last night, “The man has really drank the Kool-Aid and lives the life of the improviser.”
Eileen Kahana: [00:39:39] Exactly. That’s exactly right. And it’s something I’d like to emulate and share with anybody I can bring improv to. It’s such a fulfilling positive lifestyle. It works.
Peter Margaritis: [00:40:03] Absolutely, it does. And so, remember, the website is room2improv.com, Eileen Kahana. Ad you can reach her at, I believe it’s info@room2improv.com. Is that correct?
Eileen Kahana: [00:40:18] That’s correct.
Peter Margaritis: [00:40:20] And Eileen, thank you so very much. I can’t wait for the next time our paths cross. It will probably be in an improv class or better yet, you’ll call me and say, “I need some help with something. I’m going into school in Chicago. Can you come up and help me?” And the answer is yes, and I still have to tell my wife.
Eileen Kahana: [00:40:37] It would be my pleasure. No, no. Yes, and it would be my pleasure.
Peter Margaritis: [00:40:42] Cool. I look forward to it. And thank you so very much today.
Eileen Kahana: [00:40:44] Thank you, Peter.
Peter Margaritis: [00:40:49] I hope you enjoyed Eileen’s story. And please remember to visit Room2Improv’s website to learn more. And if you feel compelled to donate, please do. Thank you for listening. And if you’re enjoying this podcast, please subscribe and share this episode with a friend. Make today your best day.
Announcer: [00:41:13] Like what you just heard? Because it’s c-suiteradio.com. C-Suite Radio: Turning the volume up on business.

S2E38 – Entering the Niche Realm of Forensic Accounting with Chrissie Powers

Chrissie Powers is the Founder of Powers Forensic Accounting LLC. Chrissie’s experience includes investigations involving diversion of corporate assets, fraud examination and investigation, forensic accounting and record reconstruction, damaging claims analysis and documentation, and providing valuation of closely held businesses for purposes of divorce, estate, and purchase, or sale.

Additionally, she works with clients to strengthen their internal controls and management systems to deter fraudulent activity and asset diversion. She has testified in US Bankruptcy Court, Civil Service Commission, and various Ohio Common Pleas Courts and Depositions. She explores her journey from staff audit and tax accountant to finding her passion for forensic accounting. She also discusses the opportunities and challenges of being an entrepreneur, and how strong communication skills are essential for success.

Chrissie started her career in the traditional public accounting world doing tax and audit work. Early in her career, she was sent on an audit where one of the clients had been involved in a fraud incident, and Chrissie was tasked with determining the dollar amounts. After that, she was hooked on the puzzle of finding out how people were stealing money and how much was taken. She went through the CPA exam, and transferred herself to a firm that specializes in forensic accounting so she could grow in that niche.

Always Be Networking

Forensic accounting work is typically not recurring. A traditional CPA would land an audit and they may have that audit for several years before it goes back out for bid. A forensic accountant should only be coming into your corporation to investigate the fraud that happened one time, and then hopefully never again. Some of that will recur while working with various law firms, but if it ends up in the courtroom, they want to use several experts over the years instead of the same individual, so there isn’t the appearance of corruption or favoritism.

You’re always trying to find new ways to position yourself or get in front of potential prospects, potential attorneys for firms that you can provide that expertise that they’re looking for. Chrissie does a lot of speaking engagements at the bar association, banks, law firms, and CPA firms, coming in and speaking on continuing education. In this line of work, you have to keep putting yourself out there and networking.

A Future in Forensic Accounting

Looking at the accounting profession today, more and more people are beginning to specialize. The generalist approach in accounting seems to be withering away and people are looking to gain those credentials, and specialize, and become experts in a niche area. What should you look out for if you’re considering getting into forensic accounting?

Chrissie advises that having an audit and tax background was helpful to her, because those are the types of reports and records that she reviews and analyzes on a regular basis. There are classes that you can take on data analytics and more law classes to understand the laws that get looked at in a lot of the forensic accounting classes.

When you get out of school, get into public accounting and work with a firm that offers forensic accounting or litigation support. Going into a smaller, boutique firm, it’s more likely you will need to have the experience already. Find a firm that you can get some experience in.

The future of forensic accounting is very sustainable because the type of work done will not be going away anytime soon. And technology, as it’s evolving, is more likely to enhance the business model than disrupt it.

For those of you who are curious about forensic accounting, Chrissie will be speaking at conferences in 2020. She keeps a calendar of her speaking events on her website, so if you’re ready to learn more, be sure to look up her calendar and plan on attending.

Transcript:

Click to download the full Transcript PDF.

Chrissie Powers: [00:00:00] The biggest thing that you need to remember is that as an expert witness, you are an advocate for your opinion and not an advocate for your client. So, regardless of whether I’m representing the plaintiff—being hired by the plaintiff or the defendant, or the wife or the husband in a divorce that I’m still going to have the same opinion regardless of which side I’m on.
Peter Margaritis: [00:00:32] Welcome to Change Your Mindset Podcast, formerly known as Improv is No Joke, where it’s all about believing that strong communication skills are the best way in delivering your technical accounting knowledge and growing your business. An effective way of building stronger communication skills is by embracing the principles of applied improvisation. Your host is Peter Margaritis, CPA a.k.a. The Accidental Accountant. And he will interview financial professionals and business leaders to find their secret in building stronger relationships with their clients, customers, associates, and peers, all the while growing their businesses. So, let’s start the show.
Peter Margaritis: [00:01:19] Welcome to Episode 38. And my guest today is Chrissie Powers, who is the Founder of Powers Forensic Accounting LLC. Chrissie’s experience includes investigations involving diversion of corporate assets, fraud examination and investigation, forensic accounting and record reconstruction, damaging claims analysis and documentation, and providing valuation of closely held businesses for purposes of divorce, estate, and purchase, or sale.
Peter Margaritis: [00:01:47] Additionally, she works with clients to strengthen their internal controls and management systems to deter fraudulent activity and asset diversion. She has testified in US Bankruptcy Court, Civil Service Commission, and various Ohio Common Pleas Courts and Depositions. Our discussion focuses on her journey from staff audit and tax accountant to finding her passion for forensic accounting. As she states, she doesn’t count the beans, she finds the hidden beans. We also discuss the opportunities and challenges of being an entrepreneur and how strong communication skills are essential for success.
Peter Margaritis: [00:02:28] Before we get to interview, Change Your Mindset is part of the C-Suite Radio family of podcasts. It’s an honor and a privilege to be amongst some of the more prevalent business podcasts, such as The Hero Factor with Jeffrey Hayzlett Amazing Business Radio with Shep Hyken, and Keep Leading with Eddie Turner. You can find Change Your Mindset and many of the outstanding business podcasts on C-Suite Radio by going to www.c-suiteradio.com.
Announcer: [00:02:56] This podcast is part of the C-Suite Radio network: turning the volume up on business.
Peter Margaritis: [00:03:03] Also, you can now listen to this podcast on iHeart Radio. And now, a word from our sponsor.
Sponsor: [00:03:10] This episode is sponsored by Peter A. Margaritis LLC, a.k.a. The Accidental Accountant. Are you looking for a high-content and engaging speaker for your next conference? Do you want to deliver a story to stakeholders that will transform data dumping to engaging business conversations? Do you want to feel that the value a speaker provides your audience far exceeds the dollar value on their invoice? Then, book Peter for your next conference, management retreat, or workshop. Contact Peter and peter@petermargaritis.com and visit his website at www.petermargaritis.com. By the way, one of his Fortune 50 clients actually made the comment about the value he brings to your audience.
Peter Margaritis: [00:03:59] Now, let’s get to the interview with Chrissie Powers.
Peter Margaritis: [00:04:06] Welcome back, everybody. My guest today is a longtime friend who I haven’t seen in a long time, Chrissie Powers. And Chrissie, thank you for taking time out of here, I can imagine, hectic and busy day to spend some time with me on my podcast.
Chrissie Powers: [00:04:22] Thanks for having me, Pete.
Peter Margaritis: [00:04:24] I’m so excited for you because you—well, first, before I talk about that, I have to ask this question. You started your career the traditional way of public accounting counting the beans and doing that type of work. How did you—what made you—what was the driving force for you to say, "You know what, I want to do something in the forensic accounting world"? Was it one too many CSI episodes that you watched and said, "If they can do that on bodies, I’m sure I could do that in financial statements"?
Chrissie Powers: [00:04:56] I don’t know if CSI was even around at that, but I did start my career in the traditional public accounting doing tax and audit work. And like we all have read through the AICPA magazines, the newbie was sent out on a [crosstalk] where funds were missing. And it just so happened that one of the audit clients had had fraud occur through cash. And I was tasked with determining the dollar amounts. And it was like after that, I was hooked on this puzzle, if you will, as to find out how people were stealing money and how much was taken. And there was a lot in the news back then with Jessie Oddi here in Franklin County back in 1998-1999 where funds were misappropriated. So, I just kind of got hooked, and got through the CPA exam, and transferred myself over to a firm that specialized in the forensic accounting, so that I could grow that area and niche.
Peter Margaritis: [00:06:05] And as well, as you have grown it because you left the firm, and you had a partner, and you guys went out on your own, which is (1), one scary enough as it is; and (2), because you only have that—that paycheck every week, and you’ve got to figure out benefits, and you got to do all that other stuff. But you grew that firm. And I’m looking on. And now that you’re—as the beginning of this year, you went out on your own by yourself. I looked at your website and your list of clients are just phenomenal. I mean, the list simply go on, and on, and on. Mostly, it seemed like you’re doing a lot of work for attorneys.
Chrissie Powers: [00:06:46] Yeah. I would say that probably, at least, 90% of my referral source comes from the attorneys. If I have a corporation that reaches out to me with fraud occurring, we want to make sure legal counsel is involved. So, we have that attorney-client privilege, at least, until I would be named as an expert in court. So, even
if the corporation is engaging me, we’ll get legal counsel involved, so that we have that attorney-client privilege. And then, working through other CPA firms that don’t have the specialty niche, and want to keep their independence, and keep that client as a tax client or audit client. And then, a lot of treasury management bankers because they’re looking at the financial statements, and they’ll have that face to face with the business owner, and the business owner may say to them, "Something just doesn’t smell right." So, possibly, those bankers are saying, "Hey, speak to Chrissie. Powers Forensics can help you."
Peter Margaritis: [00:07:45] So, as you’re describing that, I went, "Wait, you’re not a stereotypical accountant." For one, as you—and I’ll let you give your tagline about the beans-
Chrissie Powers: [00:07:58] Yes. Most accountants count the hidden beans. I find the hidden beans.
Peter Margaritis: [00:08:04] So-
Chrissie Powers: [00:08:05] Count the beans, I find the hidden beans.
Peter Margaritis: [00:08:07] Yeah. She’s looking for those hidden beans out there, but, also, it just dawned on me, something else, that in order to be as successful as you are, you said the R word, referral, which means that you have done one – it’s my podcast, I can say this – one hell of a job out there networking to find business. And that’s something that those in the profession aren’t the greatest at doing, or they don’t like talking to strangers.
Chrissie Powers: [00:08:36] Yeah. Some accountants will prefer to sit at their desk and just crunch that tax return or crunch the numbers. But my forensic accounting work typically is not reoccurring. So, for your traditional CPA, they go out, and they land the audit, and they may have that audit for five, six, seven years before it goes back out for bid. I, hopefully, am only coming into your corporation to investigate the fraud that happened one time with the problems with internal controls. And then, hopefully, you
never need to find me again, unless you’re wanting to refer me to a friend at another organization. So, my type of work is non-reoccurring for the most part. Now, some of that will reoccur working with various law firms. However, once again, if it ends up in the courtroom, they want to use several experts over the years, and not continuously using the same individual, so they don’t give the appearance that that expert is in their pocket.
Peter Margaritis: [00:09:39] God. So, that takes—I mean, that takes a lot of work. And that takes—because when you said that, "I don’t have that nonrecurring," let’s just put it in accounting terms, "cash flow," and you’ve got to go out and find new business almost all the time. And to your point, you’ve developed a wonderful referral service because you do a lot of work with attorneys. You’ve got—you’re well position here in Central Ohio with accounting firms, one of your specialty, because you do a lot of—in the past, you’ve done a lot of speaking up at the Ohio Society of CPA conferences. I know on your website, you’ve got a number of articles that you’ve written on the topic to help drive that business because you’re an expert and you’re an authority in this area, but I would have to imagine, because myself, I have sleepless nights when I don’t have—because I don’t know—a lot of times, I don’t have that non-recurring cash flow coming in. And you’re always trying to find new ways to position yourself or get in front of potential prospects, potential attorneys for firms that you can provide that expertise that they’re looking for.
Chrissie Powers: [00:10:52] Yes, yeah. So, a lot of speaking engagements, Columbus Bar Association. I spoke for the Ohio Bar Association in the past. Banks, law firms, CPA firms coming in and speaking on continuing education. Just definitely got to be out and about and continuing to network.
Peter Margaritis: [00:11:14] Yes. And I love networking. I think it’s it’s a blast. But there’s something in that word that it’s not just easy because it has the word "work," and it does take a lot of work. So, let’s talk about the services that you provide. I guess, of your services, what is the more requested service?
Chrissie Powers: [00:11:38] Well, that varies by year and the economy.
Peter Margaritis: [00:11:40] Oh, okay.
Chrissie Powers: [00:11:43] So, back in 2009 when we say we sort of went through a depression or a recession, if you will, the divorce world, those cases were not as prevalent because people couldn’t afford to maintain two households. They were watching their cash, if you will, just like the traditional accountant. On the reverse side, I saw a spike in fraud investigations because the corporations did layoffs. They were watching where every penny was going. People started scrutinizing the financial statements. And then, those were where some of the frauds were caught because somebody had taken the time to pay attention and look at those accounts. So, it all depends on what’s going on in the economy.
Peter Margaritis: [00:12:35] Interesting. So, this is 2019. What is your most requested service? Since we’re not in the recession, per se. They’re talking about it, but we’re not quite there yet, what are people coming to you for?
Chrissie Powers: [00:12:50] All right. Now, I have quite a few fraud investigations going on. A handful of divorces and some business interruption claims. So, like the businesses, one of the owners has an accident, and the revenue stream isn’t where it was because they’re not able to work within the business. So, I’ve got to go through and look at what the yardstick measurement was three to five years before the accident occurred, see how that affected the future revenue stream, and put a calculation together for that.
Peter Margaritis: [00:13:23] Interesting. So, you, obviously, do a lot of divorce, as well as fraud related. What other services you provide?
Chrissie Powers: [00:13:33] I work with receivers here in town. Some of that is because organizations go into bankruptcy, and someone needs to come in, and either wind the company down or keep it running. Or over the years, some of those receivership have just been because two partners aren’t seeing eye to eye. One that’s locked out. So, the court appoints a receiver to try to either continue the business and buy one of the owners out, or sell it altogether, or just shut it down and make a
distribution, so that the two of them can part ways. I work in the bankruptcy arena. There has not been a lot of that with the economy doing well right now. So, that’s kind of—it’s on the backburner, if you will. It’s not real prevalent. So, those are some of the areas that are—where we get into and specialize in that.
Peter Margaritis: [00:14:23] And you also mentioned that—and prior to us recording this, I made this comment because she—Chrissie, you actually go to court and testify. And you say a lot of CPAs and even ones who are none—who are the accidental accountants, I don’t think I would want to have that type of pressure to testify in a courtroom on a case. But you take that on, and you go to court, and you testify on behalf of your client. And so, that’s going to be a little bit nerve wracking.
Chrissie Powers: [00:14:55] Yeah, it can be. The biggest thing that you need to remember is that as an expert witness, you are an advocate for your opinion and not an advocate for your client. So, regardless of whether I’m representing the plaintiff—being hired by the plaintiff or the defendant, or the wife or the husband in the divorce that I’m still going to have the same opinion regardless of which side I’m on. So, that’s—sometimes, you get put into a corner where you’ve got to reiterate and remind clients and/or attorneys of that. But not everyone likes to go into the courtroom. It just comes with time and lots of continuing education on how to handle those difficult questions and knowing how to respond to the aggressive attorneys.
Peter Margaritis: [00:15:45] So, I have to ask everybody, there’s a starting point for everything. I remember the first day I walked into Pricewaterhouse as an accountant. Do you remember the first time that you went to court to testify?
Chrissie Powers: [00:15:57] Yeah, that was a divorce case in Delaware County. I’d had some deposition testimony prior to that, but it definitely was a restless night until you had your first first chance, if you will.
Peter Margaritis: [00:16:13] So, when you got called to the stand, I imagine nerves were probably going in every which way, shape, or form.
Chrissie Powers: [00:16:19] Uh-huh (affirmative). Yes. It was a very well-known attorney that was asking questions.
Peter Margaritis: [00:16:29] And apparently, you do well because you went back, and keep doing more, and you keep getting continued education, and getting better and better at that role. But that’s—I don’t think I could sleep the night before or maybe even the week before knowing that that’s staring me in the face. That’s a skill set that many don’t have. And I applaud you for taking that head on and do it as well as you have being an expert witness.
Chrissie Powers: [00:16:56] Thanks, Pete.
Peter Margaritis: [00:16:59] But please don’t ever call me to be an expert witness. I’d be happy to help if there’s anything I could help, but when it comes to—so, I don’t mind I don’t mind speaking in public. I do that for a living. But my idea of public is not a courtroom.
Chrissie Powers: [00:17:17] Like I said, there’s continuing education up there to prep you for that. I read lots of materials published by the Sikh Group to prepare myself. And then, the attorney that you’re working for and the partner at the firm helps to get you ready for that first time until you lose your virgins [crosstalk].
Peter Margaritis: [00:17:37] So, thinking about what you do and thinking about you got an early start on this because you said you started this back in—about around 2000. Was it? That’s about right?
Chrissie Powers: [00:17:54] My first fraud investigation was in ’98. So, doing this for over 20 years. But at that time, I wasn’t 100% forensic accounting.
Peter Margaritis: [00:18:06] So, if we look at the profession today, and we still have the traditional services that are out there, but the way technology is having an impact, and things that I’m reading, things that I’m hearing, that there’s a lot—more people are beginning to specialize. That generalist approach in accounting seems to be withering
away and people are looking to gain those credentials, and specialize, and being that expert in that niche area. What advice would you give someone who’s graduating from, let’s say, the Ohio Dominican University, and with a degree in Accounting, and let’s say they’ve passed a CPA exam? What advice would you give them as they matriculate into the accounting profession as relates to niches in the accounting profession?
Chrissie Powers: [00:19:01] Well, I think that having an audit and tax background definitely helped me because those are the types of reports and records that I review and analyze on a regular basis for my different forensic accounting specialty areas. So, definitely, that background helped, and I was able to build on that. But forensic accounting really wasn’t offered in college back when – now, I’m dating myself – back when I went through school. So, there are classes that they can take on data analytics and in more law classes to understand the laws that get looked at in a lot of the forensic accounting classes.
Chrissie Powers: [00:19:46] So, those definitely would help them taking those when they were going for school. But when you get out, starting to get into public accounting and working with a firm that offers the niche areas of the forensic accounting or litigation support, so that even if they’re in audit and can help when there’s an overflow because going into a boutique firm like myself definitely me being a smaller firm now, I need somebody that has the experience versus someone straight out of college in that. So, looking for a firm that they can get some experience in.
Peter Margaritis: [00:20:27] Right. And I guess, you made the point, as what do you want to specialize in – forensic accounting, or business valuations or whatever – you still got to get the basics down and have a good solid knowledge of the basics, actually, from both sides, from the audit world and from the tax world. And then, decide how you want to specialize or where that interest lies. And I think during that period of time, as they’re building up the knowledge base is to begin to take continued education classes in those areas to see if something sparks, if there’s some interest there, or it’s like they sit through a business valuation question, "That’s why I want to do," and after a couple of business valuation classes, you go, "There’s no way I want to do that." And they have very little vested or invested at the time, and they can’t begin to look at different areas,
or if they’re lucky enough to get with a firm that has specialties to find themselves working on one of those specialties.
Chrissie Powers: [00:21:30] Yeah. And then, once you start getting the specialties and the alphabet soup after your last name, you can work out, "Am I needing all my continuing education?" because all those credentials have deferred reporting period. Some are 12/31. Some are on your anniversary date. So, that starts to be sort of a headache to try to make sure you’re in compliance with everything you’re needing to track that.
Peter Margaritis: [00:22:02] Oh, yeah. And then, there’s that too, maintaining the compliance aspect of it and keeping track. And that in itself can be its own separate, I wouldn’t say headache, but I’ll use the word challenge. But as I sit and think about the forensic accounting, and so here’s what I know as relates to divorces, marriage is the leading cause of divorce. That is statistically proven. And in those marriages, they say 50% of marriages end in divorce, and now I had a first wife, and we ended in divorce. My second wife, we will make 24 years here by the time this episode goes live. We have already celebrated our 24 years. So, I don’t think that’s going to happen again, but-
Chrissie Powers: [00:22:50] Well, congratulations and happy anniversary!
Peter Margaritis: [00:22:54] Thank you. It depends. She gives me my performance review on my anniversary to see if she wants to exercise an option on another year. But with with the aspect—I don’t think fraud is ever going to go away. Sarbanes-Oxley is not going to get rid of that. There’s always gonna be some aspect of fraud, whether from a large organization or from a small church where there’s one person in the accounting department, they end up stealing from the church. There’s always going to be fraud. There will always be divorces. There will always be disputes when we have partnerships because something tends to go awry in those. I guess, my point is looking on to the future and looking at your business, it is very sustainable because of the type of work that you’re doing. And the bigger question on top of that is it’s sustainable, and I don’t believe technology, as it’s evolving, will disrupt you. But I think the use of that
technology could actually enhance your business and your business model. Would that be a fair statement?
Chrissie Powers: [00:24:09] Yeah. And things have changed over the years. A lot of it, too, is driven by the client, and the size of the client, and how they’re keeping their records. So, I’ve used data mining software like ACL and Idea over the years. But then, we’ll run into clients that don’t use formal accounting software on the smaller side when you’re doing an investigation. So, then, they’re giving you a Quickbooks or another type of smaller package, if you will, to go through.
Chrissie Powers: [00:24:42] With the divorces, sometimes, we’re trying to find out the one spouse’s economic income, so that we can determine spousal support and/or child support. And a lot of times, they don’t have a full set of books, if you will, because the spouse uses a Schedule C. So, nobody is using Quickbooks. And so there could be a lot of keying of the bank statements to come up with what that is. There is software out there now that can scan those bank statements and dump it in. And then, it’s just us categorizing it, if you will, putting it in the right buckets for court purposes. Certain things may be deducted on the tax return, but they are not considered a true expense for more coming back to the income for the spouse for court. So, we’re adding that back.
Chrissie Powers: [00:25:32] And just kind of give you an example. So, we might have a husband that owns a business, and him and his wife have two children. All four of the cell phone bills are being run through the business. So, he deducts that as an expense tax return. Well, when I’m looking at that for divorce purposes, we’re adding that back as if he was a true employee at arm’s length, and he worked for me. I wouldn’t be letting him run his entire family cell phone bill for the company. So, those types of things would need to be scrutinized and addressed appropriately for the court.
Peter Margaritis: [00:26:09] I could imagine, trying to find that information, (1), has evolved over time. And it makes me think of a company that’s based out of Canada that’s called MindBridge. And basically what they’ve developed is an artificial intelligence Watson type of platform where you dump the GL into this Watson—into their the MindBridge artificial intelligence platform. And it immediately, within a matter of
minutes, will categorize the transactions in three ways – high risk, medium risk, low risk. And the high risk ones, from an audit perspective, those are the ones that those transactions are being immediately looked at and scrutinized to see if they’re legit or not. And thinking about your business and trying to find this type of information, I would assume that type of technology would be of great assistance to you. No, you’re not doing an audit, but you’re trying to get to find where the high-risk types of transactions are in order to help you do your job.
Chrissie Powers: [00:27:14] Yeah. And the thing that would be different is, like looking at the cell phone bill, while it might be only employees for company A, but when I come back and look at company B, this guy or wife, husband or wife, one of, whoever the business owner is, pushing more personal expenses, if you will, through. So, it’s not a one platform fits all, if you will.
Peter Margaritis: [00:27:38] Right, okay. And I can imagine that you see a lot of that where the business owner, and maybe a single member LLC, or even a small partnership are trying to run their personal expenses through the business to get the tax deduction, but they’re taking a huge risk and doing so because that corporate veil can be pierced.
Chrissie Powers: [00:28:01] Yes, yes. Yeah. And I mean, the things I’ve seen over the years from the fraud investigations to the divorces are just—make for really good stories, if you will.
Peter Margaritis: [00:28:15] So, I love stories. And so, of all your time in this, and what you do, what is—and if you can. If you can’t, I understand. And if we can keep it kind of sanitized and not name any clients or anything like that, what is the craziest thing that you’ve seen?
Chrissie Powers: [00:28:37] Well, this one wasn’t something that I saw, but there was a divorce that I worked on, and there was a child in it. And the child’s pet dog had died. And it was the attorney bringing us up to speed, but rather than properly dispose of the animal, like taking it in, and getting it cremated, and have a nice little box with Fido’s
name on it, the parent put it in the freezer. And they were pulling it out, and letting the child see it on a daily basis, and give it a kiss on the nose. That’s not accounting related but just some crazy things that I’ve seen over the years and heard about working on these cases.
Peter Margaritis: [00:29:27] Okay. I wasn’t expecting that.
Chrissie Powers: [00:29:31] Yeah.
Peter Margaritis: [00:29:31] But that is—I asked the question, and I should be prepared for what I was going to hear. But yeah, that’s creepy. That’s [inaudible].
Chrissie Powers: [00:29:41] Yeah. I mean, like I had another one that the business went into receivership. I went with the receiver to go pick up the accounting records. As we’re walking up the door, we had the fire department come flying in, the police department come flying in, and it was my alleged suspect that had been accused of misappropriating records that we we’re going to get the records from, the individual had threatened to commit suicide and had dialed 911. So, here comes everybody in, which, of course, postponed us being able to obtain the records that particular day. And on that same case, there were days that we were scheduled to be in court, and the individual wasn’t present because it, again, threatened to commit suicide and was at the hospital. But I think what had really happened is they knew the brunt of what had occurred, and that the hammer was going to be coming down sooner or later, and they just couldn’t live with themselves as to what could happen, whether that meant jail time, whether it just meant restitution.
Peter Margaritis: [00:30:48] Right, yeah. And thinking about the human aspect of a lot of what you do, there’s a lot of emotion in these types of cases outside of trying to find those hidden beans, but there are people involved. And sometimes, people take different actions or process things differently, and you come up with, again, something like that, which is kind of difficult to, to some degree, get your mind around, but we kind of understand it’s human nature and that fear. But that’s not what you kind of signed up for when you kind of went down this path initially, and it’s something that you had to
necessicize yourself with over time to not be so emotionally involved into things like that.
Chrissie Powers: [00:31:32] Yeah, yeah. You learn as you go. You’ve got to kind of leave some of that at the office, if you will, when you go home at night to family, not let that impact your daily lives. I know I have two boys who both are going to be teenagers here because my youngest is going to be a teenager. And I ask a lot of questions, and follow through, and validate, and verify things. So, if they’re trying to get away with things, you know. Before they graduate high school, it’s going to be real difficult because mom doesn’t trust anybody because of her job.
Peter Margaritis: [00:32:11] Oh, those poor boys. Oh, my goodness gracious. I wish—now, I wish I’d gotten to forensic account. Mine just started college this week, and I’m a pretty good reader of body language, but he may have something over on me. I may need to take a Chrissie Powers class in detecting fraud out of your kids. You might want to add that to be one of your services. Well, Chrissie, I’m thrilled about you going out on your own. I love what you do. It’s very fascinating. If somebody wants to find you or reach you, how can they find you?
Chrissie Powers: [00:32:56] My website is www.powersforensic.com. My email is chrissie.powers@powersforensic.com. Or if they just want to pick up the telephone, 614-745-5192. I’d be happy to chat.
Peter Margaritis: [00:33:22] And your office is located on Mound Street in Downtown Columbus?
Chrissie Powers: [00:33:26] That’s correct. 150 East Mound, just two blocks east of the Franklin County Courthouse.
Peter Margaritis: [00:33:33] And I do have to ask one question before we wrap up. Is all of your work sourced and done in basically Central Ohio in the Ohio area, or are you working on cases throughout the country?
Chrissie Powers: [00:33:49] The majority of my cases are in Ohio. A lot of them in Columbus. Sometimes, I’ve got stuff up in Lima, Cleveland, Cincinnati area. And I’ve had cases over the years far reaching as Miami, Florida, and West Virginia, and Kentucky. I had the pleasure of traveling to Miami to get records on a case. And, unfortunately, they complied and produced the records, but if they wouldn’t have complied, I would have gotten to go to the Dominican Republic, which was where their home office was sourced. So, that particular one, I was a little bit bummed. I was hoping to get to travel to the destination.
Peter Margaritis: [00:34:32] So, you do work outside of the State of Ohio. And, I guess, with technology, the way it is, you don’t—a lot of times, you’ll have to physically be there to get the information. So, if people are listening to this, because the podcast is being downloaded in almost every state and, actually, in about 35 and 36 countries, so that’s why I wanted to bring that up, that if somebody outside the State of Ohio wanting to contact you, you have done business outside the state, and they can contact you as well.
Chrissie Powers: [00:35:01] Yeah, yeah. I know, right now, I have a divorce matter that’s pending that’s in Tennessee too. So, I’m willing to travel and able to travel.
Peter Margaritis: [00:35:11] Well, cool. Well, once again, I will put your website, your email address, all that on the podcast website for this episode. I appreciate your time. I wish you all the best luck. And I know you’ll do great things. And for those of you who are thinking about going, maybe curious about forensic accounting, Chrissie did say she will be speaking again at conferences in 2020. And she does keep a calendar of her speaking events. So, if you visit her website, and keep up to date with it, and look, maybe attend one of her classes, tell her that you heard her on this podcast, and go watch her work. I’ve seen her present. She does a wonderful job. So, once again, thank you very much. And I’m sure we’ll talk soon.
Chrissie Powers: [00:36:01] Thanks for having me, Pete.
Peter Margaritis: [00:36:06] Now, that you’ve listened to this episode, what will you do to find your passion or your niche? What steps should we begin to take to achieve that dream? What system of accountability will you use to ensure your success? Changing your current mindset to achieving those dreams is critical to that success. So, thank you for listening. And if you’re enjoying this podcast, please subscribe and share this episode with a friend. And make today your best day.
Announcer: [00:36:45] Like what you just heard? Because it’s c-suiteradio.com. C-Suite Radio: turning the volume up on business.

Resources:

S2E37 – Ralph Picano | Adapting to New Technology in a People-Focused Industry

Ralph Picano is the CFO and a member of the board of directors for Wade Trim, an almost 100 year old engineering firm. Ralph believes financial strength enables his firm to maintain business operations while pursuing growth opportunities. He works to manage Wade Trim’s financial risk by balancing the demands of internal operations with governmental regulation compliance.

Ralph believes in the ethical and timely reporting of financial information and maintaining a diverse capital structure. He creates value through effective financing, measuring company performance and guiding Wade Trim’s strategic decision making for fiscal success. Ralph has worked in the consulting engineering industry in a finance role for over 20 years after beginning his career in public accounting.

As a CFO, the thoughts that keep Ralph up at night are the ones related to his company’s largest expense: It’s employees. The engineering industry bills hourly. They provide talented people to perform services for clients, and they charge their clients to create value and give them a reason to pay them. The fact that their largest expense in the company itself is payroll means that that expense category is going to be the main focus of any CFO.

Utilization is the Name of the Game

Utilization is the industry term for when employees are billing to projects. Utilization is probably the most important metric that Ralph deals with. With payroll being their largest expense category, if they are able to manage utilization appropriately then they can be successful. But if managed improperly, it becomes very problematic and that creates challenges within the entire enterprise.

Utilization can be measured in two different ways. One would be in hours and one is in dollars. How effectively is the company utilizing it’s hourly employees’ time? What percentage or hours in a work week are going to billable projects? Utilization of around 70 percent is the benchmark for where a firm wants to be.

Balancing Utilization With a Need for Technical Advancement

Ralph’s company is in the middle of converting to an entirely new ERP platform, and that has come with some struggles. The changes are necessary, they will help the company in the long run, but the time put into the conversion has been pulling people away from billable hours. And now in the second half of the year, they’re faced with an uphill climb to their profitability goal.

And so the focus has been to pull away from some of these non-chargeable initiates and get people back to working on projects. But ERP is the backbone of the company, it is the software that runs the company, and they need to make sure everyone is properly trained on it when it goes live.

How do you balance a necessary change that conflicts with the everyday needs of the company?

Adapting Business Models to New Technology

Engineering is a people industry. They charge clients for the labor, the services that they provide. But more and more technology is becoming part of that service. And you need the technology to provide that service to the client.

The technology costs to Ralph’s company have been rising quite a bit over the past few years. And the industry is still used to hours and dollars, and not necessarily the equipment or the technology that they’re using.

Now that we have the technology, it takes less time to do the same job for the client, but they are still charging the client on hours. Ralph’s firm has been working to change that model. This means a shift in charging for the value that the client has gained regardless of how many hours were put on the project.

What will you do to ensure that you’re handling all of your employees’ challenges in a way to ensure the organization’s profitability? Remember, you’re in the people business first and foremost. If you treat your people with respect, they will treat their customers and clients with the same respect that you have shown them.

Resources:

Transcript:

Click to download the full Transcript PDF.

Ralph Picano: [00:00:00] The industry is still used to hours and dollars and so, you know, people working hours, not necessarily the equipment or the technology that they’re using.
Peter Margaritis: [00:00:22] Welcome to Change Your Mindset podcast, formerly known as Improv is no Joke, where it’s all about believing that strong communication skills are the best way in delivering your technical accounting knowledge and growing your business. An effective way of building stronger communication skills is by embracing the principles of applied improvisation. Your host is Peter Margaritis, a CPA a.k.a. the Accidental Accountant, and he will interview financial professionals and business leaders to find their secret in building stronger relationships with their clients, customers, associates and peers.
Peter Margaritis: [00:00:58] All the while growing their businesses. So let’s start the show.
Peter Margaritis: [00:01:06] Welcome to Episode 37. My guest today is Ralph Cano, who’s the CFO and a member of the board of directors for Wade Trim, an almost 100 year old engineering firm. Ralph believes financial strength enables his firm to maintain a business operations while pursuing growth opportunities. He works to manage Wade Trim’s financial risk by balancing the demands of internal operations with governmental regulation compliance.
Peter Margaritis: [00:01:34] He believes in the ethical and timely reporting of financial information and maintaining a diverse capital structure. Ralph creates value through effective financing, measuring company performance and guiding Wade Trim’s strategic decision making for fiscal success. Ralph has worked in the consulting engineering industry in a finance role for over 20 years after beginning his career in public accounting. He has a bachelor of accountancy and an M.S. in finance from Walsh College of Accounting and Business Administration. He is a member of the Michigan Association of Certified Public Accountants, the American Institute of Certified Public Accountants, the Institute of Management Accountants and the American Consulting Engineering Council, and he’s on the Finance Committee. Our discussion begins
around exploring what keeps a CFO of an engineering firm up at night. If you’re a financial leader in any profession, you’ll recognize these issues that keep Ralph up at night. Before we get to the interview, Change Your Mindset as part of the C-Suite Radio Family of podcasts. It is an honor and a privilege to be amongst some of the more prevalent business podcast, such as The Hero Factor with Jeffrey Hayzlett, Amazing Business Radio with Shep Hyken, and Keep Leading with Eddie Turner. You can find Change Your Mindset and many other outstanding business podcasts on C-Suite Radio by going to www.c-suiteradio.com.
C-Suite Radio: [00:02:57] This podcast is part of the C Suite Radio Network. Turning the volume up on business.
Peter Margaritis: [00:03:04] Also, you can now listen to this podcast on iHeartRadio. And now a quick word from our sponsor.
Sponsor: [00:03:10] This episode is sponsored by Peter A Margaritas LLC, a.k.a. The Accidental Accountant. Are you looking for a high content and engaging speaker for your next conference? Do you want to deliver a story to stakeholders that will transform data dumping to engaging business conversations? Do you want to feel that the value a speaker provides your audience far exceeds the dollar value on their invoice? Then book Peter for your next conference, management retreat, or workshop. Contact Peter at peter@petermargaritas.com and visit his web site at www.petermargaritas.com. By the way, one of his Fortune 50 clients actually made the comment about the value he brings to your audience.
Peter Margaritis: [00:04:00] Now let’s get to the interview with Ralph Mercado.
Peter Margaritis: [00:04:05] Hey, welcome back, everybody. I’m excited about my guest today. First time I met him was through an e-mail that the IMA sent me because my guest actually attended one of my sessions at an IMA conference.
Peter Margaritis: [00:04:22] And I actually took this as a as a compliment because usually everybody has an idea of my last name, you know, margaritas or martini or something along the lines.
[00:04:31] The e-mail that I got from the IMA said, this gentleman said in your session, he remembers the course, he remembers the title, but he doesn’t remember your name, which was such a great compliment that the material must have been, you know, damn it was good because he remembered it but he forgot my name. So I’d like to welcome to the podcast Ralph Picano and, who is the CFO of an engineering firm, and, one, I know you’re busy. I appreciate you taking time. And I’m looking forward to our conversation today.
Ralph Picano: [00:05:05] It’s a nice diversion. Appreciate you taking me away from my time.
Peter Margaritis: [00:05:10] Hopefully that doesn’t mean you have to stick around later tonight in order to make up the time that you would have.
Ralph Picano: [00:05:18] I’ll figure it out.
Peter Margaritis: [00:05:19] As a CFO, I want to start off with one very simple question. What keeps you up at night?
Ralph Picano: [00:05:28] Well, do you think that’s simple? But it changes and that’s good. It’s good that there’s a variety in life. I can tell you that I come in and each day is a little bit different here. And, you know, so whatever the issue is at that point time, which ultimately is the one that keeps me up at night. But you know, this industry, we, we, we bill hours we’re a service industry and people are working on projects and doing a good job. And we’re able to charge our clients to create value and, and give them a reason to pay us then that everything is good. So the fact that our largest expense in the company itself is payroll means that that expense category is the one that’s going to keep you up at night. And utilization is the term we use in this industry where employees are charging or I should say it’s their billing to projects or charging projects, then we’re
getting utilization. Utilization is the, is probably the most important metric that we deal with, at least currently in this industry. And so with payroll being our largest expense category, if we’re able to manage that appropriately and we can be successful, but if we’re not, then that becomes very problematic. And so in times when when we’re not able to to get our backlog to the employees and get them on projects, you know, we’re not we’re not gaining the contribution margin that we’d like or the profit that we’d like in our business. And that creates challenges within the entire enterprise. So that’s what keeps me and the management team, certainly these days, that’s what’s keeping us up.
Peter Margaritis: [00:07:23] So define utilization for me in your world.
Ralph Picano: [00:07:25] Utilization can be measured in two different ways. One would be in hours and one is in dollars. And effectively what that is, is if the employees time, if they’re charging their time to an outside client, billable client, then they’re utilized, or as it’s considered chargeable time, and that’s the numerator in the equation. The denominator is the total dollars, total hours that employee is working. So utilization and the range for an operations individual at 70 percent or so is about where, typically, you want to.
Peter Margaritis: [00:08:05] I understand. So if basically it sounds to me, kind of, in a nutshell, what keeps you up at night, are people?
Ralph Picano: [00:08:15] Sure.
Peter Margaritis: [00:08:17] The people aspect of the job and, in order to be profitable, in order to make it to get those projects done in a timely manner, one, you have to have a workforce that shows up. That part’s not a problem. But what about morale within the organization? And how does that, does that have an effect? And you mentioned before we started recording, you’ve got a major project that’s going on that you have to have done by October. And that could affect morale within the organization or hours spent and you’re implementing, is it an upgrade or a new ERP system?
Ralph Picano: [00:09:01] It is, it’s an upgrade, but it’s to an entirely new platform. So it’s almost like it’s a brand new system.
Peter Margaritis: [00:09:08] And you know what ERP stands for, don’t you?
Ralph Picano: [00:09:12] Wait, I did hear this before, but I can’t remember. What?
Peter Margaritis: [00:09:16] Entities Reoccurring Problem. Yes, it’s always a challenge. And rarely is not the right word. But there’s always some hiccups. There’s always stuff that’s going on that causes the team to have to work later hours than anticipated. And then that puts additional strain on the organization, especially if we’ve got to hit this deadline. So that goes into that whole utilization hours. And even from an overhead perspective, you’re trying to keep your team motivated and deal with this. And hopefully the engineers aren’t getting frustrated by all of this that’s going on at the same time and then it just kind of manifests itself.
Ralph Picano: [00:10:00] Yeah. Yeah. That’s a great point. The timing of this on this conversion is a little bit unfortunate. So we we’ve been, the company has been growing and we’ve instituted quite a few initiatives in recent years. We brought on a safety manager. We have a branding manager, a training manager, and we have a lot of really cool things going on here. But they’re taking away a lot from from the operations side. And then working on chargeable projects. And it’s all good and everybody’s busy and the profit is good. No one is saying anything. But in recent months, that hasn’t been the case where utilization is lower. And here we find ourselves in the second half of the year, we’ve got a little bit of an uphill climb to our profitability goal. And so suddenly the focus now is, “Hey, let’s back off some of these non-chargeable initiatives and let’s get back on projects.” And I’m dealing with this ERP conversion where, you know, it’s our backbone. You know, this is the software that runs the company. And we need to make sure everyone is properly trained at it when we go live and hit that switch, and we have some constraints as to how we can get there with, you know, with the restriction of time on our operations side. So, you know, my crew has been doing this for a couple of years. The I.T. staff, accounting, really been working hard on getting this conversion in place and understanding the system. And most of us are salary and most of us are
non-chargeable, so that’s not so problematic to the company profitability. But now that we’ve got to roll it out to the other side, to the operations side, and there’s this whole sensitivity of non-chargeable time that is really creating creating a challenge. So you asked what keeps me up at night, if you were to ask me specifically today, here in, you know, late summer 2019 and it’s this ERP conversion hands down. So that’s where we’re at today.
Peter Margaritis: [00:12:12] But without it, like you said, it’s the backbone. It’s what really runs the organization. So, and if it takes a little more, it takes away from those chargeable hours cause now they’re non-chargeable in order to get this running properly. And with that concern of, it’s later in the year and the year end is coming. Are you on the calendar or fiscal year?
Ralph Picano: [00:12:34] We’re calendar.
Peter Margaritis: [00:12:36] And so December’s creeping up. So there’s that added pressure. But is there another way of looking at it going, ok, so we have to get this right. I mean, if it’s the backbone, we got to get it right. So we might ultimately have to take, I hate uttering these words, but we may have to take a little bit less in profitability in order to get it right. But that investment that we’re making into that this year should wash itself. And then some next year when the system is up, fully running, in sort of a mature state.
Ralph Picano: [00:13:13] That’s right. That’s the ultimate outcome. You know, we know we’re moving to this platform because it’s providing a lot more visibility to the project managers. It’s going to make their ability to run projects be that much more improved. So, you know, there is a benefit that we’ll reap at some point. But it’s hard to see that where we’re at today. So. So I think the answer is, the answer is somewhere in-between. Right. We got to be as efficient as we can in rolling out this training, minimize the non chargeable time, yet effectively train our staff.
Peter Margaritis: [00:13:47] Right. And there’s an organization that I did some work for and they rolled out these communication initiatives on how to better communicate within
the organization. It was a really large organization, but they rolled these tools out, you know, even from like Windows 365 and some version of Slack, and these, a variety of project management, you know, technology pieces to this group. But they never trained them on it.
Ralph Picano: [00:14:21] They didn’t communicate properly, did they?
Peter Margaritis: [00:14:24] They gave them the tools. But they didn’t show them how to use the tools. And it was a, literally, somewhat of a train wreck there for a while until they could untangle themselves. I mean, just because we give you the tools. There’s a lot of training that goes on. So you know how to use it. And it’s not, “Here’s a manual,” because, you know, if it’s a guy, we’re not going to read a manual. We want pictures or we’re going to figure it out ourselves unless somebody is there to walk us through it. Right. Yeah.
Ralph Picano: [00:14:55] I have the experience.
Peter Margaritis: [00:14:56] Yes. So the size of the firm. How many professional staff do you have any sense of from the engineering world?
Ralph Picano: [00:15:04] We have, considered professionals, roughly 300.
Peter Margaritis: [00:15:07] Now 300. Located in just one location, or?
Ralph Picano: [00:15:13] We’re headquartered in Detroit, but we have offices in ten different states now, we have 20 offices in total. I’m, today I’m sitting in our in our largest facility here in Taylor, which is a suburb of Detroit.
Peter Margaritis: [00:15:28] OK. Where do you find your talent? What do you, how do you recruit?
Ralph Picano: [00:15:34] That’s been a challenge. Yes, sure. All of your listeners can attest to. We have had, we’ve really had to bring on, particularly for the higher, higher
level professionals. We’ve had to bring on recruiters that are specific to the industry. And, you know, search high and wide throughout the country to find the right talent. It’s a challenge. And that’s, it’s not inexpensive.
Peter Margaritis: [00:15:59] No. But, also, do recruit out of the universities?
Ralph Picano: [00:16:03] We do. We do. And our CEO has been adamant about making that a priority. Our managers are very, are oftentimes very sensitive to adding staff. And if you don’t know what your needs are going to be eight months in the future, you’re more tentative in making a hiring commitment and, you know, to get the university, the best of the universities to attract students. You got to get them in October. Right. When they graduate in June. During recruiting season. Andy McCune, our CEO, has been very adamant on telling managers that you’re going to extend offers in October. You’re going to hire em in June. Even though you don’t know what you need at that point. Just we need that staff.
Peter Margaritis: [00:16:50] And talking to a friend of mine who’s the CEO of a engineering firm in Lexington, Kentucky. He mentioned something about there’s a hiring scarcity out there for talent in the engineering world. And the way he explained it was, so we’ve got a lot of this younger talent in and they kind of have, they have a little bit more leverage against, with management, than maybe in the past, because of the scarcity that’s out there and it’s almost to some degree like, “You need me more than I potentially need you.”
Ralph Picano: [00:17:30] That’s accurate. We’re experts in that. And the impact of that is that, you need to start adjusting wages for those who are a little bit higher. Who’ve been with the company a couple of years longer or maybe a little bit older and more experienced. And so you have that cascading impact of increasing wages across the board.
Peter Margaritis: [00:17:54] So when we talk about bottom line there just a few minutes ago? I mean, in talking with him. That was one of the things that keeps him up at night is the ability to find the right people to come and do the right jobs. And be dedicated to
their job and not be so sensitive that if this, something doesn’t go my way, I’ll just go find something else.
Ralph Picano: [00:18:18] Right.
Peter Margaritis: [00:18:20] And the other thing that he mentioned to me that that keeps him up at night is, well, he’s an engineer and now he’s CEO, and he’s not an accountant. He never wants to play one on TV, but he’s had to learn being in that role and understanding the numbers a lot better than he did when he was a project manager. But then he also realized that the project managers have no idea how profitable the organization can be or their world is because they’re so focused on their project, but not understanding what the revenue comes in from. And also the expenses, because still in business, you know, I’m going to I’m going to buy it here, but I’m going to market up to here in order to make that profit. And it’s something that he struggled with and getting those engineers to understand the basic accounting side. And then when you say, I know you say accounting to engineers, they just shut down.
Ralph Picano: [00:19:22] Right. Right. Actually, that’s that’s one of the reasons, too, that we’re making this conversion, is that the previous version of the software is very accounting centric. And so engineers weren’t able to, or always felt it was an accounting application. The new version is more project manager centric, so it’s more dedicated towards what they do.
Peter Margaritis: [00:19:44] Oh, OK.
Ralph Picano: [00:19:45] That should be a good thing. But I completely agree. And it’s been that, since I’ve gotten into this industry that I’ve been amazed at the fact that these are some of the brightest, smartest people I’ve ever met. And you just assume that they understand the concept of profitability. But a lot of them are, some of them are outstanding and they do, and others are just so passionate about what they do and want to do a great job for the client, which bodes well for us, right?
Peter Margaritis: [00:20:14] Right.
Ralph Picano: [00:20:15] You know, but they don’t always, they don’t always completely grasp the whole nature of profitability and how we are successful at having that profitability. So education is important there as well.
Peter Margaritis: [00:20:31] And it takes me back to my days when I was a banker and I was a lender and lenders were bonused on the gross amount of the loan, which I thought was ridiculous. So we’ve got, we had lenders out there making deals and basically giving the business away. But they were thinking about their bonus and accumulating those bigger dollars, when I always said we should be bonused on the amount of profitability that we get.
Ralph Picano: [00:20:58] That’s right.
Peter Margaritis: [00:20:58] But even the lenders who had somewhat of an accounting/finance/numbers background, maybe not as deep, just would never understand and would never grasp or whatever. And to me, it was just, I can’t. And this is before I got into the accounting profession. I just never understood it and it’s the same thing with engineers, probably even with architects, and those highly technical fields that do great work. But there’s still the semantics of. The accounting world.
Ralph Picano: [00:21:30] Yeah, yeah. Your bonus comes from somewhere, right? It doesn’t come out of thin air. Yeah, it’s amazing. You know, we accountants and engineers are kind of lumped together often with being, you know, we’re all geeks. Right. And one of the other things that I’ve learned in being in this industry is that, I’m getting off of the profitability side here with this comment. But, one of the, you know, you have this perception that engineers have, you know, the black socks and the tennis shoes, and they’re the geeks, but one of the things I’ve learned in this industry is these guys are very personable, very, I mean, they have, their job is to convince others and to be collaborative and to, you know, communicate. And so, they’re not geeks, they’re not geeks. Us accountants got them easily beat in geekdom.
Peter Margaritis: [00:22:34] When I think of engineers and accountants, until I started understanding the engineering world a little bit, after I kind of had an idea of how they think, I wish that I’d have taken more engineering classes because accountants look at things as how much is it cost? Right. Engineers look at things that can I make this better? And that’s the part of their mindset that just blows me away, is that when they look at things, they’re not looking at what it cost, they’re going, how can we make this more efficient? How can we make this better? How can we do this differently to make our, obviously, our client happy? But that’s how they work and they’re not processing, well, this is costing us this much.
Ralph Picano: [00:23:19] Right. Right. And they’re just smart. They’re smart people. And, you know, ultimately, they’re making the world a better place.
Peter Margaritis: [00:23:27] Ultimately, yes, they are making better place and safer. Right. I think about that when I cross a bridge and I’m going, “I hope the thing is structurally sound.” You know. And I’m in an elevator going up 30 flights, 30 stories and going, “Okay. Somebody had to design this. And hopefully they took all the continuing education courses in order to make this thing a solid.” But there’s gotta be a way. Well, I know there is a way. It’s just, how do we communicate that information? Oh, the importance of the, having the business acumen, to engineers, to have a better understanding of the organization, and how it operates financially.
Ralph Picano: [00:24:12] You know what? One thing we do here, which I think helps, is we try to be as transparent as we can with our financial results, with our staff. And so on a monthly basis, there’s six metrics, six or seven metrics that that we continuously measure and we put them on the bulletin boards in all the offices. So there’ll be a chart indicating what our results were in the various metrics. And then a little, just a short little commentary that I write each month. And so it’s visible to everybody. Everybody can see how well the company is doing or areas where we need to improve. And I think, inevitably, that rubs off and they have an understanding of how things run and how profitability is achieved through those metrics.
Peter Margaritis: [00:25:00] By doing this, have they started asking more questions?
Ralph Picano: [00:25:05] Some do, some do. I mean, we were doing it for a number of years. So, you know, the questions may may have been more, there may have been more questions early on, but yeah, they generally, periodically, we’ll get some questions.
Peter Margaritis: [00:25:18] And the response back to them, do they understand or have some grasp or they’re going, OK, and they walk away going “I’m still not sure.”
Ralph Picano: [00:25:30] Most walk out of here with, I think, understanding. And you feel that they’re, you know, react accordingly if there is a way that they should be reacting, I don’t know, once they leave my office, what happens. But when they leave here, it feels that way.
Peter Margaritis: [00:25:50] There was an engineer that was, excuse me, there was a CFO who worked for an engineering company in the Pennsylvania area. One of my courses. And at some point he says, “I learned to be a translator.” I said, “OK.” I knew it was going. But the rest of the class wasn’t quite picking up on it. “Tell me about your translation.” “Well, I’ve got to take financial numbers and then I have to translate it so that the CEO understands what I’m also saying. I also have to learn, I’ve had to learn engineering. The language of engineering, to be able to translate that into financial to be able to translate that. I’m multilingual.” I know English. I know accounting. I know engineering. And we all think about that. You know, these professions that we’re in. We do, we all do speak a foreign language to those who are not, you know, in that same industry. But we tend to think that even though you’re the CFO in this engineering firm, that you should understand engineering and probably now as many years as you’ve been doing it, you have a much better understanding. But in those early years.
Ralph Picano: [00:27:07] Don’t ask, don’t ask me questions about engineering stuff.
Peter Margaritis: [00:27:11] I had very little in that engineering world. But over time, you’ve kind of, you’ve been able to translate, have a better understanding where they’re coming from. But they didn’t sit down and say, “OK, now, Ralph, I know you don’t have
an engineering degree. We do. We’ve got like thousands of hours more than you have. So I’m going to take my time and explain engineering to you.” That didn’t happen.
Ralph Picano: [00:27:31] Right. That’s true. Right.
Peter Margaritis: [00:27:34] They just came at you with guns blazing and just going. I’m sure you understand this because you’ve been employed here at this engineering firm and you have no idea what they said.
Ralph Picano: [00:27:45] Yeah. And the industry is changing. And I don’t know if you’re if your friend, who’s the CEO of the engineering company has expressed this to you. You know, you talked about when you cross the bridge and hoping that that bridge won’t fall apart. You know, a lot of our funding is public funding, right, to fund the projects that we that we work at. And, you know, the public, it’s not sexy stuff. It’s infrastructure stuff. Right? So it’s tough to get the public or to get the lawmakers to approve or to allocate funds to these projects, which we all feel, we all know, are very important. But they’re just not front and center, you know, and that’s problematic in our industry as well. If you talk to any of those in the know, they’re going to paint a pretty bleak picture as to the status of our bridges and our roads, up here in Michigan the roads are horrendous. And, you know, there’s a lot of funding. We certainly are in need of a lot of funding. But, you know, where is it going to come from.
Peter Margaritis: [00:28:59] Yeah, well, that’s a very good point. And thinking about that, the infrastructure and where those dollars ultimately come from and who does the work for the US government or the state of Michigan or whomever and where that money is. But it’s a necessity that we need, but you’re right. And you know. We’ve known this for a while. The infrastructure is not in great shape. And here in Columbus, one thing I have noticed more lately, I mean, we’ve gone through orange barrel seizing and we’re still into it for a little while. But I’ve seen more other types of infrastructure projects going on with our roads. One in particular, 270 which goes around the city, they’re doing a major construction project to put an HOV lane in. And because they’re gonna put the HOV lane in they’ve had to kind of help fix everything else associated with that. And so I’m starting to see more of these types of projects,.
Ralph Picano: [00:30:10] And bike lanes as well.
Peter Margaritis: [00:30:12] Yes. Bike lanes. I love it. I love riding my bike. But I rarely ride it on the road just because the, you know, there’s too many stories out there. But yeah. He didn’t mention that, but I know that his firm does a lot of work in the government sector and that’s, that in itself, if I had a large piece of my business in that industry or relied upon the U.S. government, I don’t know if I would sleep at night.
Ralph Picano: [00:30:46] Yeah, yeah, yeah. It’s you know, there’s so much that we don’t even see. You know, we in the public general public thinking, you know, we don’t see what’s underground. We don’t see the status of the of the condition of the pipes. You know, the energy grid, you know, that type of thing. There’s so much out there we don’t see. But it’s out there and it’s, there is issues and, I don’t know. Hopefully there will be no major catastrophes that force us to pay more attention to the funding of these things, but.
Peter Margaritis: [00:31:21] Unfortunately that’s usually what happens in order to get the attention, which is the wrong piece. It’s that, right now, we’re probably living in the equivalent of BlackBerry. If you think about BlackBerry, they were the be all and end. All right. They were the communication expert and they got, they became very complacent at what they were doing. And next thing you know, the catastrophe happened. Here comes Apple. And they never really took Apple serious. And ultimately, it took that to wake them up. By the time they woke up, it was too late. So that’s true. I didn’t think about that. But that’s very true that we had to figure out a way to fund in order to keep the infrastructure, as, you know. And I travel a lot between trains, planes and automobiles. Yeah, it’s kind of scary. I appreciate that.
Ralph Picano: [00:32:18] Sorry to put the doom and gloom on you.
Peter Margaritis: [00:32:24] Oh, no worries at all. But it is. I’m glad you raised that point, because we don’t think about that because it’s there. And we think about it. We
think about it when a major hurricane comes through and knocks out the electricity or knocks out the roads or, you know,.
Ralph Picano: [00:32:44] Up here in Michigan, the Flint water crisis, right.
Peter Margaritis: [00:32:47] Right.
Ralph Picano: [00:32:47] Everyone’s heard of that.
Peter Margaritis: [00:32:49] Exactly. Yeah. And then we wake up, by that time, to some degree, it’s too late. So as we begin to wrap up. There is one area I do want to broach real quickly. And in your world, you mentioned about the ERP, but how has technology began to affect your world?
Ralph Picano: [00:33:09] Yeah, I was going to comment on that even without you asking, as we’re talking about profitability and this has been a drain on it. So as I mentioned earlier, we, you know, we’re a people industry. We charge clients for the labor, the services that our employees provide. But more and more technology is becoming part of that service. And you need the technology to provide that service to the client. And what we’ve experienced here is that the technology cost on our PNL and our capital expenditures have been rising quite a bit in recent years. And the industry is still used to hours and dollars. And so, you know, people working hours, not necessarily the equipment or the technology that they’re using. So the struggle is, now that we have the technology, you need less time to do the same job for the client, but we’re still charging the client on hours. So we’ve got to, we’ve got to get used to or we’ve got to change that model to reflect either. And we’ve been we’ve been trying to do this. And we’ve been relatively successful in charging for rental or, you know, other costs, non labor costs associated with completing the project, or basically just provide or just charging for the value that the client gained regardless of how many hours were put on the project. At what rate. It’s just the value that the client has gained. Just do the whole mix of engineering services and technology. So that’s that’s a model we’re kind of still evolving.
Peter Margaritis: [00:34:59] Yeah. Funny you should mention that because I’ve heard that even in public accounting firms, this technology, we’re not having to go out and do the audit per se, and get, you know, a conference room. We were able to take the GO, throw it into a, some type of artificial intelligence. Out comes, you know, these are the areas you need to look so that a lot of time has been cut. So what does that do to, but, how do we price it now?
Ralph Picano: [00:35:26] Right.
Peter Margaritis: [00:35:27] And do we, but to your point, we’ve done it quicker, but we’ve had the investment into the technology that we still need to recoup. So that’s that’s a mental exercise that can hurt in trying to figure that out.
Ralph Picano: [00:35:46] And trying to convey it so that the client understands.
Peter Margaritis: [00:35:50] Yeah. How do I explain to the client that we got it done quicker, much more efficient, but the price really didn’t come down, right? It’s that it’s, yeah. We can look at the same thing in healthcare. I mean, we’re doing more with technology and health care than ever before. The prices haven’t come down because we forget about the investment into that technology and what it cost. And we still need to recoup that cost.
Ralph Picano: [00:36:19] Somehow health care pulls it off.
Peter Margaritis: [00:36:23] Yeah, not well. Yeah, you’re right. Other professions are struggling with that. But it’s really just the same thought process. Yeah. Yeah. I admire CFOs for the vast knowledge that they have. Because I would, I’m going to make this assumption. As a CFO, you not only have finance and accounting reporting to you. Who else reports to you?
Ralph Picano: [00:36:54] I have administration reporting to me. I don’t have human resources or I.T. They report to the CEO. Obviously, I was very close with those groups though.
Peter Margaritis: [00:37:05] Right. OK. So, yeah, I had other CFOs have had I.T. and or H.R. Oh, really? You have an H.R. background. So I qualify and they laugh. I’ll go, I’ve had to learn it, and I had to get it, you know, obviously gain a better understanding of it. And when I speak with CFOs I have the utmost respect because I can’t, I don’t know if I could ever do that job or I want to, but the number of balls that you have to juggle on a daily basis and then still go home to a family and have a good night’s sleep. It’s a tough job.
Ralph Picano: [00:37:40] It’s rewarding. It’s good to be relevant.
Peter Margaritis: [00:37:43] It’s good to be relevant. And speaking of being relevant. Since you mentioned, I had to have all the admiration. Before we started, I noticed something on Ralph’s desk that, tell me if I’m right. He still has his ten key on his desk, folks. I know. I know. Anyone who’s listening who’s an accountant, who’s a CFO, they go, “Well, what’s wrong with that? We have ours on our desks as well,” right?
Ralph Picano: [00:38:09] Well, I mean, I told you, Peter, that I also have the painted rock from my daughter when she was in kindergarten on my desk as well. So I have two paper holders here.
Peter Margaritis: [00:38:21] And by the way, how old is your daughter now?
Ralph Picano: [00:38:24] That daughter is now 22.
Peter Margaritis: [00:38:26] Oh, wow.
Ralph Picano: [00:38:27] I have a 22 year old and an 18 year old.
Peter Margaritis: [00:38:29] Congratulations.
Ralph Picano: [00:38:30] Thank you.
Peter Margaritis: [00:38:31] One’s off payroll, one’s almost?
Ralph Picano: [00:38:34] No, they’re both still on payroll.
Peter Margaritis: [00:38:40] I appreciate your time. I appreciate your candor and this conversation. It’s been fun to get to know you. And I’m looking forward to seeing you in September in Denver. And actually, in a much more relaxed environment, especially at the Rockies game.
Ralph Picano: [00:38:58] Yeah, it’ll be fun.
Peter Margaritis: [00:38:59] And then the next day when I’m presenting you, you’re free to heckle as much as you would like.
Ralph Picano: [00:39:06] We appreciate you coming out, Peter, we’re looking forward to having you.
Peter Margaritis: [00:39:10] I’m looking forward to getting there, sir. Safe travels out to Denver. I hope by that time the ERP project is maybe getting close to winding down. And you can have a couple nice evening sleeps that you might not have when you’re at home and in the office. Thank you again. I look forward to seeing you in September.
Ralph Picano: [00:39:35] Thank you, Peter. See you in September.
Peter Margaritis: [00:39:39] Now that you’ve listened to this episode, what will you do to ensure that you’re handling all of your employees challenges in a way to ensure the organization’s profitability? Remember, you’re in the people business first and foremost. If you treat your people with respect, they will treat their customers and clients with the same respect that you have shown them. Thank you for listening. And if you enjoyed this podcast, please subscribe and share this episode with a friend. Also, please visit www.c-suiteradio.com to listen to many of the excellent podcasts that they have in their network.
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