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Welcome to Portfolio Perspective: Managing Risk & Seizing Opportunity, a podcast focused on the asset-based lending industry. Join Andrew Pace, Chief Client Experience Officer at Asset Compliant Solutions, as he interviews experts, shares insights, and explores strategies for managing risk, optimizing portfolio performance, and seizing opportunities in an ever-evolving financial landscape. From regulatory changes to technological advances, each episode provides actionable takeaways and deep dives into industry trends. Whether you’re a lender, servicer, or recovery expert, this podcast offers valuable perspectives to enhance your approach and improve outcomes.
Buying new technology, implementing new technology actually feels like progress. But sometimes the real problem that we wanna solve has nothing to do with technology.
Andrew:Welcome back to ACS Portfolio Perspective. I'm your host, Andrew Pace, Chief Client Experience Officer at ACS, joined today by Deborah Rubin, CLFP, CEO, and founder of Tomorrow Zone, and the author of Enter the Tomorrow Zone. Deborah is an innovation strategist who works with senior leaders across finance and technology to help them navigate complexity, gain clarity, and design future ready organizations. Her work is grounded in firsthand experience leading the Advising Complex Transformation efforts, and she is known for helping leaders see patterns they are too close to notice, and for reframing innovation as a human systemic practice rather than technology initiative. Deborah, welcome to the show.
Deborah:Thank you. So glad to be here.
Andrew:Well, thanks for being here. Your work sits at the intersection of innovation, leadership, and industry transformation. One thing you talk about often is how much the conversation has changed in recent years. So to set the stage, I'd love to begin with where the industry is right now in its innovation journey. How have you seen the conversation shift from convincing leaders that innovation matters to helping them understand how to do it wisely?
Deborah:It's interesting. So I first got into industry level innovation conversations. Man, in the early the early two thousands, I started speaking on stages in this industry. And, you know, it was always very tech forward, tech first type thinking back then. And, you know, if we fast forward, technology has changed a lot.
Deborah:You know, we've gone through many different hype cycles in our industry just along with the rest of the business world, whether it was, you know, cloud versus on prem or, you know, isolated solutions or end to end, you know, ERP type solutions, integration, and now the big hype is AI. And, you know, all along the way, in the past, it was like trying to get tech topics into some of the the bigger industry events was like pulling teeth, and now not a problem at all. In fact, there are whole events just dedicated to innovation now. I don't think we have to convince people that innovation is necessary. It's an imperative for our industry.
Deborah:If we don't want to be left behind, if we want to remain relevant long term, there's so much change going on in the world, so much uncertainty, but also so much opportunity. And so, the conversation has shifted, I think, pretty radically from where I sit. I led the Innovation Council for ELFA for six fun filled years, and I met with senior leaders that represented a whole cross section bank, independent captives, service providers, and startup fintech leaders. And every month, we would get together, and we would take a look at what's going on with technology and innovation and what specifically does that mean for us, where we are right now in this industry, and where things are going. And I think that the way that the conversation has shifted is no longer are we trying to convince people of the need to innovate.
Deborah:And we're not trying to even convince people that, you know, with the the prevalence of of AI and all of the advances happening there, we don't need to convince people that AI is here, and you need to be paying attention. The conversation has shifted beyond hype to, okay. What exactly do I need to do right now practically to actually get value for my company, for my people, for my customers, for my partners, from all of the technology opportunities that are out there. I used to have to try to convince leaders that they need to pay attention to AI. And it was even just a couple years ago.
Deborah:I was at an executive roundtable, and I was told by C level leaders, I don't believe anybody in our industry is using AI. And, you know, I would show up and go, well, here's a 100 use cases from across the end to end life cycle of leasing right here. Like, it's here, and it's happening. And so now people are really trying to find a way forward and cut through the hype and the noise to find the actual value in solving the real problems that are valuable to solve with all of these new tools and techniques that we have access to. So it's been a pretty radical shift over the years.
Andrew:For sure. So in regulated industry like financial services, makes innovation uniquely challenging?
Deborah:Well, I think what's challenging for us, especially in a regulated space, is we have to recognize the constraints. And constraints don't mean that it holds you back from innovating. In fact, there are many examples of where constraints actually led to better innovation, but it's about how you think about it. It's about how you frame it. If you think about the story of how the iPhone was invented, the story goes that Steve Jobs was telling his design engineers that it could only be this big, and he was carrying around a piece of wood, a block of wood, a certain size.
Deborah:And he's like, And it can't have a bunch of buttons, no buttons. And so they're trying to figure out within these crazy constraints, how do we create this thing? Well, this thing, when it was released on the world in 2007, was the beginning of changing our world, and that came from constraints. So then back up and think about what are we facing in the finance world? Oh, we have to comply with these regulations.
Deborah:Well, those are actually pretty clear boundaries, And so we have to innovate a little bit differently than the folks in Silicon Valley who are saying, hey. Move fast and break things. That doesn't fly well in our space, but it doesn't mean you can't be creative. It doesn't mean you can't use imagination. It doesn't mean you can't think differently about the future.
Deborah:It just means that we have to be really clear together about what those constraints are, and then we can innovate despite the constraints. And so I think it's just the shift is in how we frame it. It is not impossible to innovate in our space, but we've got to create the conditions that make it possible for us to do that with our people and with the technology that we have access to today, and there are so many opportunities.
Andrew:I agree. You talk about the tendency for organizations to fall into the yesterday zone. What does that look like in day to day behavior?
Deborah:Oh my gosh. So you find yourself in what I call the yesterday zone if every day is just consumed by the fires of day to day, by the things that are urgent and important, but often at the expense of imagining what's possible long term. And so then you find yourself, whether you're, you know, doing a digital transformation initiative or you're working on a modernization or you're trying to automate a process, you can find yourself falling into a trap of rebuilding the past instead of shaping what's next. And we find ourselves in a trap of of building around assumptions that have never been tested or haven't been challenged lately. If you think about examples, I was working with a client one time, and they were like many finance companies, they wanted to build a portal and create a great customer experience.
Deborah:But the challenge was that they were assuming their customer is the same as they've always been. And there was an idea on the table for a certain type of experience for customer, and one of the leaders is like, well, our customer's never gonna adopt that. And then someone bravely raised their hand and said, well, actually, I've been talking with such and such customer, and the new generation that's coming up and taking over the company, this is exactly the type of experience that they're looking for. That's the challenge. The yesterday zone is building the way it's always been done and assuming that the past is gonna dictate what the future looks like.
Deborah:Instead of like, you know, I'm from Minnesota, and you hear the phrase all the time. It's a big hockey state. Skate to where the puck is going. That's how we need to be thinking about how we're designing experiences for the future. Where is your customer going, and what does the customer of the future look like?
Deborah:Boomers, Gen X, millennials, Gen Z, and on. Very, very different spectrum. You know, when you're dealing with your customer, imagine a customer who's in management who has never known a world without Google. You can't assume that's always gonna be the way it's always been. And so that's that's the yesterday's own trap.
Deborah:We don't wanna copy and paste the past onto new cool technology and then call that innovation.
Andrew:I love the hockey reference, skate to where the puck's going. Yeah. One of the greatest player that ever laced him up, Wayne Gretzky. Reason why he was great is he didn't skate to where the puck was. He was skating to where he anticipated the puck was going.
Andrew:So great hockey reference there. You talked about the trap. If we can dive a little deeper and talk about what is the tech first trap, and why do so many leaders fall into it?
Deborah:Oh, man. Well, it's We can all fall into this.
Andrew:Yeah.
Deborah:So here's the challenge. Often, we're looking at problem and and and maybe the symptoms that are presenting. We can think very quickly, oh, all we need is we just need to throw AI on it. We just need to throw Salesforce at it. We just need to throw this technology on it rather than really digging in to figure out, like, what is the real problem that we wanna solve?
Deborah:Sometimes the real problem that we wanna solve has nothing to do with technology. But buying new technology, implementing new technology actually feels like progress. And so when we're thinking about systems, the way I think about systems, systems are not just software. Systems involve people, process, technology, policy, the forces of change, the environment around. And so if we're thinking in terms of an ecosystem, that's very different, and that's beyond just a software license.
Deborah:But it's a tricky trap because when you're under pressure to make decisions, you're under pressure to get things done, signing on the dotted line for a software license can feel like progress. But if you don't do the deeper work of of really looking at what's going on across our system and our company and then figuring out the real problems to solve that are valuable to solve, just because something can be solved with automation or technology doesn't always mean it should be. And so really doing that holistic thinking about what is it that we really need, sometimes you can actually avoid unnecessary technology expense. I I worked with one leader who brought me in, and the big question was, which software platform should we buy? That's what he thought the main question was.
Deborah:And I asked, well, can we do a, you know, a diagnostic and really dig in and figure out what you know, see what's going on and see whether it makes sense for that sort of a large investment? And when I got in and I started working with the cross functional team and we started getting really honest about the current state, what I found was that, actually, they had a adequate platform from a software standpoint. It actually was adequate for where they were and where they needed to go for the next few years. However, the reason why they were feeling the inefficiency and the bottlenecks and all of those symptoms, that software had not been adopted evenly across their team. And the processes that they had created for that platform were not being reinforced.
Deborah:And so they weren't reinforcing their policies. They were not reinforcing the adoption of new processes. As a result, software wasn't being adopted, and they were having communication and and processing bottlenecks. There's no level of software spend that will fix that problem because it's not a technology problem. And so you can see the difference.
Deborah:Buying software is just gonna actually amplify that problem rather than fix it. And so that's that's why the the the tech first trap can be so so tricky and sneaky because you feel like you're doing the right thing, and you don't find out until after you kick off an extensive initiative that you're actually on the wrong track.
Andrew:Yeah. Sounds more like a process and a people problem, not necessarily an attack problem. Right? Yeah.
Deborah:Yeah. Yeah. I mean, sometimes it is a legitimate technology problem, but more often it's a combination of those things.
Andrew:So how can constraints, rather than slowing innovation those down, actually accelerate?
Deborah:I think the biggest way that a constraint can be an accelerator is when it brings clarity, and when you are really getting clear on the guiding principles and the guardrails for that thing that you're trying to achieve. And it is counterintuitive because it feels like if you if you slow down a little bit to get that clarity together that you're slowing down progress. But, actually, when you do and you slow down just enough to understand what those boundaries are, it becomes an accelerator for your team as you're going through the messy middle of any kind of an implementation. And the reason for that is because when you understand what the constraints are and you understand what your guiding principles are, it raises the quality of judgment under uncertainty. And so imagine a team that understands we are committed to only implementing core features over customization unless absolutely justified to the highest levels of authority in our organization.
Deborah:When everybody understands that constraint, I mean, imagine how would that change the level of decision making once the team is hitting the pressure points of the actual implementation. And if you've ever been through a digital transformation initiative or an ERP implementation, you're facing thousands of decisions. When you've got clarity of guardrails and constraints, when those decisions hit, they're not gonna drift, and you're not gonna relitigate decisions that you've made already in the past. You've got a team that's in lockstep moving together, and that's how it actually can become an accelerator. I'm just curious, have you been through a digital transformation yourself?
Andrew:Yeah, we've been through several in my twenty five years with ACS. We've been through several system We've been through several new operating systems. I think four, we're on our fourth.
Deborah:Okay. Yeah. So you've seen this firsthand.
Andrew:Have, I have. Yes. So not an easy exercise, and you're right.
Deborah:It's not.
Andrew:Got to have buy in, and you can't expect perfection right out of the gate. Right? So
Deborah:Yeah. And every time that you invest a little bit in in nailing down that clarity before getting into the tech, you accelerate your team's ability to get through that. And it doesn't mean it's gonna make it easy, but it will be a lot less dramatic. And it's it's it's it's surprising what can happen when you approach it with that mindset. I actually you know, I've been working with a company, and they're implementing core systems.
Deborah:And one of the things that we did is step back and get really clear about all of these things. They're actually living what I talked about in my book. But by applying these things and getting really, really, really clear, not just internally as a finance company, but with their vendor partners and their implementation partners, Everybody's very clear about these things. It so empowered the team that they actually implemented a core leasing system back office on time and under budget with zero drama. That's the kind of difference that this makes.
Deborah:And when we did the retrospective with that team to try to understand, oh my gosh. Well, first of all, like, this is not an everyday thing that we just saw here. So what was it? And we got the teams together jointly to to just examine, like, what worked so well, and what would we wanna make sure we do next time? They they said over and over again, it was that up front work that we did together to get that level of clarity.
Deborah:As a joint team, it made all the difference empowering them through the messy middle. They were still, like any other project, faced with tough decisions along the way, but it fueled them as they went through it. And so that clarity and understanding those constraints, just a little step back, accelerates you through the tough stuff.
Andrew:Thank you. That framing is powerful, especially the idea that leaders are asking how rather than why, that leads naturally into structured method you and your team use to help organizations get clarity and move forward. So let's shift to the approach behind Tomorrow's Zone. Yeah. If you could walk us through the sixty day co creation process, what does that journey look like?
Deborah:Okay. So this is our signature engagement, and it's called the catalyst sprint. And and so it's a very structured approach to getting a cross functional team aligned before you kick off your initiatives. And so it's it very much embodies the co creation shift that I talk about in the book. And co creation is about bringing the right people together to work together on the new thing.
Deborah:And it goes beyond collaboration because we talk you you mentioned earlier buy in, and buy in is important. But sometimes buy in can look like just compliance. Something that's way more powerful is shared ownership. And that's what comes out on the other side of this engagement. So imagine a cross functional team, they've gotta be involved in this thing.
Deborah:Compliant, doing it because you have to, and it's been mandated versus doing it because you are so bought into why this matters to you and to your colleagues. You understand not only the big picture of how your business works, how the process flows, but where you fit into it for the first time. You've had conversations that have never happened before in the history of your company about exactly honestly how your company works and how it impacts each other across the cross functional team and how it impacts your customers and your partners. And so now you're moving into the future with the most clarity about how your company actually works. But beyond that, we have not only looked at the current state of people, process, technology, policy, forces of change affecting you and your customers, but we have also looked at what is it going to take to achieve that future that you now understand together as a shared vision for the future that you wanna create.
Deborah:And we work together to create the next steps roadmap. And so now you've got a team that's not just bought in. They've co created. They have shared ownership in that roadmap. And now when we exit that engagement, we have a team that, as ownership of the strategy, it's hard to resist the strategy that you were a part of creating.
Deborah:We've got shared ownership of the priorities. We know what's priority, and we know why. And we know what we need to build and why we need to do it. Nobody's questioning it. They're already bought in.
Deborah:We don't have to bolt on some sort of buy in theater activity at the end of creating the roadmap. They're ready to go, and they can't wait to get started. And that's the difference. You know? It's not just a, you know, a sale discovery type of thing.
Deborah:It's actually a deep, let's get your team ready to take on and shape the future rather than rebuild the past. And so it's a very different approach. Every team that we've done it with, they come out on the other side a little bit different, but very much ready to shape that future that they see.
Andrew:Thank you for sharing that journey. So why does co creation dramatically increase the odds of success compared to the top down approach?
Deborah:I think it comes back to ownership. If people are already bought in and they feel like they have some ownership in the thing that they're doing together, they're going to naturally want to get involved and make it happen. And some people might call this alignment. I ran into executive of a finance company just last summer. I was at an event, and and we were happened to sit at the same table.
Deborah:And he said, you know, that work that you did with our team, it got us aligned. And the amazing thing is we stayed aligned, and they've just been executing on the strategic roadmap that we put together, getting win after win after win. But the difference is not only the executive, but his cross functional team has ownership in the outcomes. It makes all the difference in the world.
Andrew:Thank you. And you just talked about alignment. So what are some other things that leaders are most surprised to learn about their organizations during this process?
Deborah:Oh, man. So that's interesting. We often hear things like, oh, I didn't know that you did that, or I didn't why do you do that? So, you know, when we when we step back and we and we take a look at the big picture of what's really happening in an organization and our process is highly visual. So it involved a lot of sticky notes.
Deborah:We used to do this in ballrooms and boardrooms and filling walls and windows with sticky notes to help co create the map of what's going on in the company with people process, technology policy, all the things. And now we do it totally virtual. They've been doing it virtually for five years now and even get better results with it because it's easier for people to participate. Some of the fun discoveries, quite often, I've run into companies, oh, we don't have a lot of technology, and then I'll do my rapid mapping approach with them, and we will find that across their tech stack. Not only do we have an accidental architecture, but we have way more apps than they actually knew.
Deborah:I've I've seen up to 80 different apps running a leasing business because we're looking not only at the core systems layer. We're looking at every single layer of the tech stack for an equipment finance company. And when we get people, honestly, know, hey. What are all the tools that you use to engage with your customers? And I'll just ask questions like that going down every single layer of the tech stack reference.
Deborah:And and then they they step back and go, woah. I had no idea. We had so many different tools. They were so disconnected. We've got duplication right there.
Deborah:No wonder we're not communicating. We're not even standardized. And it's amazing what will just kind of the workarounds that will grow up around core systems and the assumptions that companies have about what's really going on in their process and technology situation. We'll also have people saying, Oh, I had no idea that that process was so manual for you. We could actually do this.
Deborah:And so they'll actually start getting into imagination and solutioning mode once they understand where the problems are. We also will I had one team that I was working with, and this was outside of the equipment finance industry, but they were in danger of going out of business in a state because they were missing something in compliance, and they just could not find it. And so we mapped everything out. We mapped out what are the state agencies looking for and their relationship with the state agencies and the process for compliance. And once we had it all mapped out, what we found was like, oh, this person thought that this person was doing the thing, but what really showed up on the map is nobody was doing the thing.
Deborah:So like, it's right there. There's no accountability assigned to this task that seems to be vital to achieving compliance with this state's agency. And so, like, you know, things like that will come to light. And and and when we see it all mapped out, it looks really obvious. But it's only by doing that process that you will actually see the unseen.
Deborah:And so those are some of the examples of some of the surprises that can emerge when we actually get people together, and we take them through a structured process to examine all these areas holistically, and then they start to see the unseen.
Andrew:Can you share like, why is shared understanding often the most valuable outcome?
Deborah:So have you ever been in a room where somebody throws out a term? You're not quite sure what that means.
Andrew:Of course. Right?
Deborah:And no and nobody says anything.
Andrew:Silence.
Deborah:So this happens all the time, and it can happen in the littlest things, even just terminology. So I'll be working with a leasing company, and my terminology in leasing is funky anyway. I wrote the CLFP handbook, and I had to collaborate with at least 40 different subject matter experts as I was writing the sixth edition. And I remember working on a glossary even coming to a shared understanding of the definition of something. Like, what is small ticket, mid ticket, large ticket?
Deborah:It was a long discussion. So imagine being in a leasing company and you're doing a digital transformation, a big system implementation, and the term comes up. And the vendor assumes it means one thing. Your accounting group assumes it means this, and your documentation group assumes it means this other thing, but nobody says anything. And then you just move on.
Deborah:And now you're building the wrong thing because you didn't have shared understanding of what that thing means. And now you're going to get into rework later because these things weren't questioned early. So what myself and my team, what we will do when we're working with a team is we actually will we can actually sense when this is happening. We go, oh, wait. Hey.
Deborah:Can you just explain to me, Margie? What does that term mean to you in this context? And Margie will explain. And then Jake in the other department will say, oh my gosh. That is that's not my understanding of it.
Deborah:And then the vendor will say, well, and I thought it meant this. And now we're having that's gonna lead to a shared understanding of what is this thing that we wanna do and why do we wanna do it and what does this term mean and how are we gonna use it together in this project. Now we can move forward with clarity, and we can avoid the expensive rework or bugs or unintended consequences of that misunderstanding. And those things happen more often than you might think. I mean, if you think about what happens in some of these technology projects, just one ERP system could have 60 different modules, and each module has a 100 different decisions and questions that you're facing as an implementer.
Deborah:All of those are opportunities for misunderstanding and misalignment. And so shared understanding is the superpower to help your team get through that. It's not just shared understanding within the cross functional business team. It's shared understanding along with your vendor and your implementation partners. We all have to have the same understanding of what is it that we're trying to achieve, why are we trying to achieve it, and how are we going to do it together.
Deborah:That is a huge accelerator and one of the biggest things that will actually empower your team to succeed.
Andrew:Thank you so much. So once leaders have clarity and alignment, the next step is building for what comes next. And that brings us to one of the central themes of your book, the idea of architecting the future rather than reacting to the present. So let's explore that mindset. You write that technology does not transform organizations, people do.
Andrew:What does that shift in perspective mean for leaders?
Deborah:Well, it's recognizing that back to that tech first trap, that technology is not the only thing that's gonna transform your organization. It's definitely an ingredient. You know, technology can definitely enable you to transform how you do business, how you serve customers, the experience that they have as they're working with you. But technology alone doesn't do it. It takes people to make this happen.
Deborah:It takes people working together. And so, you know, the leader's role then shifts. It's not just selecting the right tools, but it's about creating the conditions where people can succeed in shaping the future together. And, you know, that's about making good decisions and and having those guiding principles so that when things get tricky, and they will in, you know, today's world, technology is super powerful, and it can be very complex. And you're going to hit tricky spots because there are things that you just can't know at the start that you only can know and discover as you get into the weeds.
Deborah:And so if you create the conditions for your team to succeed, you create that shared understanding, you create very clear guardrails and guiding principles, you're actually gonna empower your team through. And now you're shaping the future. You're thriving through it, not just surviving a project. It's a big difference.
Andrew:Sure. I agree. I completely agree. So let's look ahead five years. So why will the winners of 2031 be the ones architecting systems, capabilities, and strategy now?
Deborah:So I I think that this boils down to intention. You know, you don't have to just let the future happen to you. You shape it by the actions that you take and the decisions that you make right now. Sometimes we can get so shortsighted that we're just focusing on, you know, this quarter's numbers, next quarter's numbers. But if we really want to build a foundation for a more awesome future, we need to step back, and we need to zoom out, And we need to look ahead to where are things going.
Deborah:You know, back to the skate to where the puck is going concept. Where is technology going? Where is the world going? Where do we wanna be as a company in five years? We're not trying to predict the future.
Deborah:That's a futile exercise. This is not about prediction, but it is about preparation. It's about being future ready. And, you know, if we zoom out and and start to imagine what are the possibilities, when we look at how fast technology is advancing, where are things gonna be in five years? And, you know, that can help you then to make better decisions now so that you don't paint yourself into a box of limitation because you were thinking about how things are today or how they were yesterday.
Deborah:And so this is a a mindset shift that can help you to imagine new future possibilities. And it's, you know, it can actually build a lot of excitement within your team as well when you start to imagine, you know, what what is a customer of the future, and what could a customer experience look like given all of the different types of possibilities that we can see even now and knowing that they're only getting better. I mean, it's probably been a lot of conversations about AI. A lot of folks are saying, you know, the AI that you're using today is the worst it's ever gonna be. I've noticed I've been using AI since 2016 in my business, and it has gotten better constantly.
Deborah:But now we're at a pace where it's blowing my mind about every other day. Yeah. It's moving so fast. And so, you know, what's it gonna be like a year from now? I don't know, but it's probably gonna be way beyond where it is right now.
Deborah:And so what am I doing right now to prepare for that future that I see? And I think that's the difference. You know? Are we shaping the future with intention? Are we architecting it, or is it just gonna be accidental?
Andrew:Yeah. I mean, I guess I guess we'll find out. Right? You know, and for companies weighed down by accidental or legacy tech stacks, where Mhmm. Would be a good start for them to begin?
Deborah:So I think if you're you can kinda you can feel stuck with legacy technology. I think that a great place to begin is stepping back, and our catalyst sprint is an awesome way to do it. But taking a look at where are you right now? Where is this legacy tech causing challenges for you? And where do you really wanna take your company?
Deborah:Not just as a leader, but, like, as a cross functional team. Does everybody see the same future that the leader sees? I often run into teams where that's not the case. And and, you know, we bring that to light together. Once we can see that future that we wanna create together, then we can step back and look at, okay.
Deborah:Well, given what we have right now, what is it that needs to change to enable us to shape that future that we wanna see? And and now instead of just, you know, buying more tools, we're actually architecting the pieces of the puzzle that we need so that we can create a new future. And, you know, I'm reminded of I joke around a lot, you know, about accidental architecture because when I look at sometimes now, especially in equipment finance, how these companies grow up, often the structure and the architecture, especially for tech, comes later in the game because, you know, at first, it's all about sales and generating revenue. Right? It's get you know, let's do deals.
Deborah:And then, you know, if you build a backwards timeline with a team, often I find that ops comes later, tech comes later, and then discipline is coming later and later in the game. And all all the while, you've built up kind of an accidental architecture. Oh, this tool will work for now. This tool will work. And how about this one and this one and this one?
Deborah:But it wasn't created with attention, and now you've got a tech stack that's not really serving you. And so, you know, stepping back and and reimagining, you can actually start to recreate what that tech stack needs to look like and create a road map to achieve it. You can't do it all at once. You know? But figuring out strategically the right sequence for these changes, that can make a huge difference because then you can start to get value along the way as you're making these changes, as you're transforming your organization.
Deborah:But doing it with an architectural mindset versus just, oh, let's just buy more tools. That feels like progress, but doesn't always help.
Andrew:Of course. Even with strong vision and the right mindset, the real work happens execution, as you mentioned. Many organizations get stuck in what you call that messy middle. So for our final topic, I want to look at what it takes to maintain momentum where the path gets a little complicated. Do leaders often misunderstand about the messy middle?
Deborah:I think well, I think a big misunderstanding is if you hit the messy middle of the project that you're failing, And that's not true at all because every every major initiative hits that point where you're so far from where you started from, but you're not yet where you need to be. And you're in the middle where uncertainty and complexity is skyrocketing and the pressure's on. And it's super uncomfortable because you're no longer where you started from, and you're not yet where you wanna be. And, frankly, it can just suck. But you you can't go around it.
Deborah:You can't avoid it. You can only go through it. Right? And so this is where most transformational initiatives derail or stall. Sometimes it's because you're running into techno technology issues, especially if you're doing a lot of integration, And it's because you're discovering new things that you could not discover until you get to that point in the journey.
Deborah:You they're just not gonna come to light until you get to that point. And so the big misunderstanding is, oh, we're failing because we hit this tricky spot. But, actually, this is the point that can make or break a team and can build incredible strength in your team. And the the the thing that can empower you to get through that has to do with the work that you did up front. And I'm not talking about knowing all of the requirements.
Deborah:That's not what it is, and I'm not talking about selecting the right software. Technology doesn't transform. People do. How are you preparing your people to go through that messy middle? Are they armed with clarity around what success looks like?
Deborah:Are they armed with clarity around decision rights and authorities? Are they armed with clarity around the guiding principles and the guardrails that help them to make awesome decisions in the toughest, most pressure filled moments. That's what helps people to get through the messy middle. It's not that you can avoid it, but you can actually empower your team through it. And it's up to the leader to create those conditions and continually reinforce the conditions that enable your team to thrive through it rather than creating a traumatic situation, which I see way too often.
Deborah:Super capable teams, awesome, powerful technology. And when we don't have those ingredients to empower the team through that messy middle, they just it it becomes a nightmare rather than an adventure. And and it doesn't have to be that way if we start just slightly different and create and sustain the conditions to help the people move through. And this isn't change management. This is about preparedness.
Andrew:I I love the armed with clarity. That's great. Why is this stage where momentum and trust are most at risk?
Deborah:Well, a lot of times, by the time you get to this point, you have invested a lot. Every team member has invested a lot mentally, physically. They're probably exhausted. Pressure is on. And this is where you could start to get, you know, pressure from leadership to, oh, we need to move faster.
Deborah:We need to add more people. If I'm brought into a project at this time, you know, at this point, what I'm looking at is where are we lacking clarity? Where do we have misunderstanding? You know, where is that missing? Because that's the only way that we can get it back on track.
Deborah:And so, you know, we would usually come in as more of a a steering and advisory level capacity. And and coming in from the outside and and looking at it, we're able to see things that the people that are down in the weeds can't see. And then we can help facilitate the conversations to get those things back on track. You know, the the thing that makes it tough when you get to that point is because of the level of uncertainty that you're encountering. And it is uncomfortable, but, also, if you're lacking clarity in all those areas that I mentioned before, you don't have the necessary ingredients to actually deal with that uncertainty in a successful way.
Deborah:And that can drain your team faster than anything. And so, you know, it just you have to, as a leader, not just lead with, you know, the direction and where we're going, but you have to kind of be a guardian of making sure that you always have those conditions present so that your team can succeed through that when they encounter the uncertainties that you've got their back. But also, you're going to bring clarity. And, you know, maybe you have to remind or reinforce those guiding principles or the goals or the conditions of success that you agreed on at the start and remind people of why they're on this journey in the first place. Often, one of the things I see you know, if I'm called in to look at why did this project fail, we actually build a whole picture of it, and then we can go back and go, it was right here.
Deborah:This is where it started to go up the rails. And what I often see is shortly, you know, it could be maybe a few weeks or a couple months into the project, the vision is gone. It's lost, and it's not reinforced. It's, you know, on a dusty PowerPoint deck somewhere, but it's never it's never revisited. And and that's when the team starts to drift from the original vision.
Deborah:And that's where the added expense comes in, scope creep comes in, all sorts of icky things start to come in when we lose sight of the vision. And so, you know, as a leader, you can you can continually reorient people. Here's why we're doing this. Here's why we're doing this. You know?
Deborah:And and it's not a major thing, but it is easy to lose sight of it when you're in the heat of the battle and you're deep in the weeds. I remember I used to work for a bank leasing company, and my boss always told me, it's pretty hard to remember that it was your job to drain the swamp if you feel like you're up to your ears and alligators. And that's how it feels on some of these projects. And so the leader can come in and help reorient the team back on track, back on vision, and back to those guiding principles pretty quick.
Andrew:What signals show that an organization has truly crossed into a tomorrow's own mindset?
Deborah:So one of the biggest shifts that I start to see is that we're no longer in constant firefighting mode. We're starting to imagine new possibilities. We're expanding our view of what could be, and now we're getting into the art of the possible. And some of the signals are behavioral, behavioral, cultural. Where I usually find it first is in the language.
Deborah:And and we usually it's interesting. I've been doing our catalyst sprint for close to ten years now. I started my business thirteen years ago. It's been over ten years. And reliably, by the eighth or ninth module in a catalyst sprint.
Deborah:And so that, you know, the first part of it is a sprint through a structure of nine different work sessions that have very carefully designed exercises to do what we need to do with teams. But without fail, by the eighth or ninth session, I hit a tipping point with teams where they shift out of here's what's wrong with everything mode into expansive here's what we could do mode. And so the language starts to change from this is what's wrong. This is what's broken to, oh, we could do this. Oh, we should do this.
Deborah:What if we did this? What if we didn't do that at all? And so now they're shifting into possibility mode. They're shifting into expansive future creation mode, and they're they're moving beyond the way things have always been done. And now they're embracing and chasing what could be, and that's where we wanna get them.
Deborah:Because if we get them there, now we can shape the future with intention. I think the challenge for a lot of leaders is they think they can just dictate this, and they can just tell a team, know, hey. You're the innovation committee. Go over there and brainstorm and come back with awesome ideas. And I've had leaders come to me and say, I have told my team to do that.
Deborah:I I financed it, sent them away, and they came back with all the same ideas. Nothing new. Nothing truly innovative. Well, if they're not taken through the process to actually get to that new mindset where you get that shift, they're not gonna get there because their day to day is about firefighting, staying in the box, preserving status quo, following the procedures, complying with regulations. It's not expanding and going, Oh, what if we didn't do the credit app at all?
Deborah:What if we used AI? That's a whole different way of thinking. And one of the things I found in my research is it has to do with how our brain is created. You can't be in firefighting mode and expansive future possibility mode at the same time. It's not physically possible the way that our brains are wired.
Deborah:And so it stands to reason that you're not gonna be able to take people right out of firefighting mode and get them into that expansive mode without a process to get there.
Andrew:Yeah. It sounds like they're in their comfort zone mode, and they need to get in their tomorrow zone mode.
Deborah:Yeah. Yeah. And we need to get them a little bit uncomfortable Yep. To stretch their thinking.
Andrew:Sure.
Deborah:You know? And and like we've done this with clients where I was brought in to help a client understand what's possible with AI. We had to stretch their thinking, and then we had to expose them to the possibilities. After we looked at where all the problems were, then we started to explore. Okay.
Deborah:Well, what would be possible? Then we were able to get them into this space where they were able to start to connect the dots. They came up with close to a 100 use cases in a half hour together. But it's because we were able to we we put them through the process to get them into that possibility thinking, and that's tomorrow's own thinking. Now they're talking about what is the customer experience seven years from today?
Deborah:What would that look like? And what they were coming up with was completely different from where they started. It doesn't have to take long.
Andrew:Deborah, this has been an incredible conversation. Your insights on innovation, leadership, and organizational transformation bring so much clarity to a topic that often feels overwhelming for people in equipment finance and financial services. As I mentioned earlier, we've gone through four different system changes, and it's not an easy exercise.
Deborah:It's not.
Andrew:Before we wrap up completely, is there anything else you'd like to share with our listeners, or any final thoughts you want to leave with them?
Deborah:So, yeah. I think that the big takeaway that I've been sharing as I've been sharing about the book is it's really easy to remember. Clarity first, then technology. I mean, if you remember nothing else, clarity first, then technology. I would encourage you to check out my book.
Deborah:It's available on Amazon. It's called Enter the Tomorrow Zone. And if you are not yet ready to dive into the book, you can get a free download at enterthetomorrowzone.com. And it's actually a thinking tool because the place that where you start as a leader if you're facing something like this in your future, start with chapter one, and I've created a thinking tool that will actually help you to step back and think about this and get clarity for yourself and your situation that you may be facing. That tool is available to you, and of course, you can always reach out to us at tomorrowzone.
Deborah:Io.
Andrew:Thank you. Thank you so much. And now, as we've done it at the end of our last several episodes. I like to wrap up with a fun debate question, and since you're from Minnesota, here's the question I have for you. What is the better Minnesota tradition?
Andrew:Is it ice fishing in January or boating on the lake in July?
Deborah:So that really comes down to what kind of toys you have available to you and whether you're a chill baby or not. So ice fishing is really fun, and NEFA does a really great ice fishing event. Have you ever attended that?
Andrew:I haven't. It it I I missed this past year's because it conflicted with another with another event that I had.
Deborah:I wasn't able to go this year, but I always try to hit that when I can. It's so fun. And and they have the right toys and equipment. So, like, they have these ice fishing houses that are actually, like, these really, you know, hoity toity campers, but with a hole in the in the bottom so that you can put your fishing line in. Also, there's tech involved.
Deborah:So they have a camera underwater, and then you can watch on the monitor as the super cold fish slowly swims around and ignores your bait. My preference, though, is being on the lake in the summer, in the sunshine, when the water is clear as glass, you're filling out because you're catching a lot of fish, and it's more fast paced, and you're not going to freeze your face off. So even though I am a fan of ice fishing, I would much rather be on the lake on the water in the summer.
Andrew:I would agree. I would do the ice fishing once, although I've never done either as far as in Minnesota, but I'll trust you be as the expert. But yes, I would most definitely want to be on the lake in July. I did see some people post some pictures of the most recent ice fishing event, and I think fish must be a lot bigger in the summer because some of the fish they caught are about as big as a male.
Deborah:They're usually, like, six and a half. Yeah.
Andrew:So I would imagine there's there's bigger fish to catch in the in the summer months.
Deborah:Well, yeah. They're hungrier in the summer.
Andrew:Oh, yeah. Oh, yeah. They're a little as you mentioned, they're moving slowly in the colder waters for sure.
Deborah:I don't blame them.
Andrew:Yeah. Right. I don't move fast in the winter either, so I wouldn't expect to tell you what. Deborah, thank
Deborah:I'm going out to Minnesota sometime for that.
Andrew:I will. I'm hoping next year. My daughter graduates high school this year, so she won't basketball, have obviously conflicting with this event. So I'm hoping I will be able to attend my first NEFA ice fishing event in the 2027. Awesome.
Deborah:Well, hope Hope this on the ice.
Andrew:Yeah, it'd be nice. It'd be nice. We have plenty of ice here in Western New York on Lake Erie, but it's not as thick as You're not going to see motor homes or campers parked on Lake Erie, but no, I do see a lot of huts and little tents as I drive into the city on the lake. So those people are definitely They're definitely They got to love it to do it, but I'll try to definitely do it once to say I did it. So Awesome.
Andrew:But thank you again for joining us and sharing your wisdom. And to our listeners, thank you for turning in to another episode of ACS Portfolio Perspective. Make sure you subscribe so you'll never miss future conversations with leaders shaping the future of asset finance and recovery. We look forward to having you with us next time. Thank you.