A Conversation with Carl Cox
This episode features a conversation with Carl J. Cox the CEO and founder of 40 Strategy, author of Lost at CEO: An Entrepreneur's Guide to Strategy and Host of the Measure Success Podcast. Carl has been an executive leader in seven different organizations who have grown from 2x to 7x with operations in four continents. Today, Carl is tracking towards his 10-year vision to positively impact over 1 million people, 10,000 organizations, and to donate at least $1 million to charity.
Carl is a sought-after speaker and podcast guest to challenge the audiences to think differently about strategy. He shows how you can defy the odds to reach your destination faster. His inspiring message will empower you to change your habits and discover a better way.
Carl’s Contact Information: 503-709-8762 | CarlJCox@40Strategy.com | www.40strategy.com
Transcript:
Suzanne Hanifin: Well, hi there! This is Suzanne Hanifin: with Acumen Executive Search, and I am so fortunate to be here today with my friend Carl Cox from 40 Strategies. Carl and I have known each other for a number of years, and I'm really excited to have him here at Profiles of Leadership. Carl's and my relationship goes way back, for when he was in Finance and Accounting in very large, very dispersed organizations. I think we've known each other through seven of those, to which, out of those seven, you have helped grow double or more in multiple Industries. You were a CFO by the age of 30, which again is so impressive and should say a lot about Carl. Then, after this great run as CFO with multiple companies, you really dove into operations and leadership and strategy, where you ended up in the second half of your career. Not only working with organizations to help them scale and grow or transition, but you've also written a book, which is pretty amazing. So, Carl, again, thank you so much for being here.
Carl Cox: It's an absolute pleasure to be on your show today.
Suzanne Hanifin: Awesome! Well, you know, we talk about nothing being a straight line and there are curves and avenues that we go down in our career, but it's usually because we've had some formative leadership or management experience younger in our life. Who's helped you, and what do you still carry going forward?
Carl Cox: Well, there are multiple people, you know. I could go back to a mentor I had early on. He said, "Get a great first job and get a degree. People think they know what you know." So that, I think, was brilliant advice. And then, to get a great first job, and the purpose behind that was, meaning, go to a place where you're trained. I do go back to my early days at Cooper and Librant, which is now PriceWaterhouseCoopers. The training there was extraordinary. They kick your butt. I remember those first two years. I remember the first year having 500 hours of overtime, and that was a normal year, right? That was not a lot for that when you're coming straight out of college. You just have half a day of classes every day. And I went to a relatively rigorous university, you know, a top 20, 25 program. But still, you know, there's a big difference in going full-time. And so, that was a big thing. But the biggest mentor I remember having was a man named Jerry Remy. And there's a concept in "Good to Great '' called level five leaders. And I want to be careful—nobody's perfect, you know, nobody's an angel, so to speak, you know, that's here and walking around and doing things on a day-to-day basis. But Jerry walked the talk. And his consistent commitment to doing what he said he was gonna do, he had a group of followers with him that just worked with him for years. And he had just this commitment to it. And watching it and seeing it for the first time because, frankly, I didn't see it for the first decade of my career. I saw a lot of people grinding. I saw a lot of people trying to climb the corporate ladder. I saw a lot of people fighting over trying to become the top of the corporate ladder. It wasn't very fun, frankly. I didn't know any different, though. I just thought this is how it should be. And so when I joined Lightspeed and had this experience, it was such a transformational time for me. And Jerry was, once again, this just exemplified great.
Suzanne Hanifin: Yeah, isn't that amazing? How, again, how formative some people are that you aspire to be? And then it's interesting, later in our careers, you know, add another 10 years onto that, and we start looking at the leaders we were working with, and you really can spot out the ones who care and it's about their personal values and how they show up. So let's talk about some of your personal values and how you show up because it does bleed into the day-to-day. And how do you take those personal values and operationalize?
Carl Cox: I think one of the things we all try to do is, we're trying to make a difference, at least most of us do, right? We're trying to make a difference, at least we say we're trying to make a difference, and um, that's very meaningful to me. It's interesting, the first part of my career was, once again, internally focused. How do I help companies internally help companies and how do I make sure I provide enough for my family? I have four kids, wife and four kids, married my high school sweetheart, and so frankly, a lot of my initial part was, I have a goal purpose to make sure that I can provide for them, making sure that their college education is taken care of, so that was, that was frankly a lot of my early predator cred. Well, once I got that taken care of and that had been established, I was like, so what's next? And so what's been really exciting with my current company, 40 Strategies, is I wanted to set the company up the right way. And one of the things I believe in is to give, and in this terms of giving, great value for your clients, making sure you're making a difference and value for them, but we also give money. So, we give the first 10% of our net revenues to charity, and we have the goal of giving at least a million dollars to charity through this company through what we're trying to do. And so that to me, and so we really walk the walk, every single month, one of my biggest checks goes out the door to charitable organizations, and it has been so rewarding to me and to develop these connections with these charitable organizations that are just doing an incredible difference. So that's one of the things that we're doing to help walk our talk here at 40 Strategy.
Suzanne Hanifin: That is wonderful, and it bleeds into, again, how do you hire and what are the characteristics you look for, you know, for 40 Strategy? What are those qualities?
Carl Cox: Well then, so you get "give first," right? It's a key thing. But that also goes to giving towards clients and caring about clients. We're super grateful that we have had this personal experience of a lot of success internally with a lot of companies, and now my goal is to help transfer that knowledge back so other people can have that same experience. And we've been having it. It's been so exciting to see companies double, and profits double and triple, and just have these legitimate, really great outcomes. But with that, you need a team of people that understand, once again, it's about giving first. So, we have to give to our clients. So, we need very client-focused oriented individuals that, at the end of the day, they're trying to make sure, you know, we haven't hit it yet, but we're trying to create a world-class experience consistently. And what I mean by "we haven't hit there yet" is because we have very high standards, but we want to go towards that. So, it is a goal and a purpose that every single person who works in the organization, they have that mentality. A second thing is they have to be curious and be learners. You know, we need people who don't have a fixed mindset but a growth mindset. And when people have that, they have this opportunity to do incredible things and change their own sense of being and sense of self-worth. And then also, once again, give to our clients. We have changed in a good way our delivery and the way we're doing things as we've learned from our clients and once again trying to continuously give value. I think a lot of people in companies, they have this idea of going to do this, you know, whatever it is. It doesn't. That's not what they're looking for. You have to recognize what they want, and then when you match that and deliver that, that's when you truly create value in the marketplace. And so, we have been flexible and nimble to recognize where value is created and try to, once again, match it. But our employees and our staff and our contractors and anybody who works with us, they have to have that same exact mindset.
Suzanne Hanifin: Yeah, and you work with a lot of different organizations across many different industries and different sizes. When you look at your clients and you go, "Boy, with this strategy," and I'm actually gonna quote you which you said, "Navigating strategy with purpose," can you expand on that and give an example of how that's worked and what you mean by that?
Carl Cox: Well, let's start. Core is that this is going to sound bad, but most people are really bad at strategy. I mean, the numbers are, you know, horrible. Only 10% of organizations actually get two-thirds of their strategic objectives.
Suzanne Hanifin: Wow, I didn't know that
Carl Cox: Yeah, so what we do is we help design world-class strategic plans, and more importantly, we help them get it done. Okay, so when we talk about navigating your strategy with purpose, we change the verbiage so people don't think that this is a New Year's resolution. A New Year's resolution is roughly a 6% goal acceptance that it's going to actually happen. That a year from now, you're going to still be doing your New Year's resolution. It hardly ever happens. One in 20 people actually get to that threshold. That's not acceptable to me. What's acceptable to me is when you have that wonderful whiteboard session at a strategic retreat, and you follow through and you get the majority of your objectives done. And so we change terminology, and we call it a destination rather than a goal because when you get on an airplane, you expect to arrive at your new place. When you set a goal, people doubt you to begin with. And so we change that terminology on purpose, and we call our strategies journeys because the reality is, strategic planning is a hypothesis. It's not a fact. Your strategic plan that you perhaps prettied up and now it's collecting dust on your bookshelf and you're actually hiding it because you're embarrassed about it. Well, that's the reality. Your strategies will change, but you have to monitor that, adjust accordingly to get your ultimate outcome. So when we're talking about navigating your strategy with purpose, we recognize that it's not a straight line, right? You're going to go through these challenges, you're going to go through these learnings, you're going to maintain curiosity, you're going to measure the things you need to measure to get to your destination that you want to get towards. And so that's why we talk about this concept, navigating your strategy with purpose, because in the big picture, if you look out, you're trying to get somewhere new, right? Like, if somebody asked to hire me, "Hey Carl, I just want to have my company match inflation, please don't call me up." Okay, we're not interested in working with people who are just status quo. Frankly, you're falling behind. If you aren't growing, you're dying, and the data is really clear about that. And so we believe in growth, once again, going back to that. And so we like to work with people that have above-average growth. Now, once again, not everybody has the 2X and 3X, and when I said that, that's not in one year, in most cases, right? It's over two or three or four years, depending on the size of the company, but it can happen. And often our sell as a CEO, owner, entrepreneur, business leader, we sabotage ourselves to where we can actually go. We don't believe it because we don't think we can get to that journey, or we're not willing to change, we're not willing to be curious. And so that's when it's so fun to work with people who are willing to change their mindset. And Suzanne, I can tell you there's been multiple people I've met with who are far smarter than I am, multiple degrees, been in their business for 20 years, and they kind of get caught in their own ways, right? They get caught in their routines, they get caught in their habits, and when we work with them, I always come in with an open mind. I never come in once saying, "This is what you have to do to fix the company." I have no idea until I go in. Now, we have hundreds of strategies, we focus on 40 strategies, we find the ones that are going to work the most effectively, but that's based on learning, right? Processing and identifying what's going to work best for you. And then we figure out a plan based on actually doing that. And what's so fun is when we have clients that were like, you know, Carl, I was so skeptical at first, and in some cases, they didn't want to hire me. I have sometimes about half my clients are PE clients, and so sometimes I get dragged into the part, it's a turnaround situation, and they say, "Thank you for opening my eyes, help me see something that I've been blinded to." They literally have been blinded to because they're caught in their own habits. So that's that process, right? It's a process to change who you are and to become something new, and this is biological, right? They say every seven years, all your cells die and renew. This is actually natural stuff. It's just amazing how much we always want to be the same, even though the reality is we aren't. And so when people are willing to embrace change, move towards new things, they can get absolutely incredible results and get to the destination they actually desire and try to get at
Suzanne Hanifin :Yeah, no, this is very insightful because, again, we tend to limit ourselves, and I speak obviously with some authority on that. But, you know, so when you look and sometimes, like you said, you're forced to come into an organization, what advice would you give a CEO on how to make those changes which are so ingrained?
Carl Cox: One of the big things we talk about is very intentionally creating stretch goals. I'll use the term "goals" here for a moment. Using some level of stretch goals, and the reason why we do that is because it forces you to change your habits. See, I go back to if you want to grow 3 to 5% each year, you probably don't have to change anything because that's just, frankly, inflation. You're just doing the same thing each year, year in, year out. But if you want to grow 15 or 20%, you're probably going to have to change a habit or multiple habits. And so that's why I like people to start thinking that because it's helping them think, "Okay, we've never done that. We haven't done that in five..." I was with a company that hadn't grown in five years, hadn't grown a dollar in five years. It was stable. That's all they thought they could do. We came in and the company doubled in a year. It literally doubled in one year. And why? There were self-limiting beliefs as to who they were and what they could be. And once we helped them see, stretch, create stretch goals, they started focusing on different habits. And once they started changing their habits, we started having better results. You know, there are three factors that limit growth in every situation: it's the people, it's the process, and it's the systems or some combination thereof. The problem is, you don't know which one it is. Often, we blame a system or we blame a process. "It's our CRM system. We need to replace that and our sales will get better." "We need to change our ERP. That's why we don't understand the numbers." It might be true. I'm not saying that those things aren't necessarily true, but is that really why your sales aren't growing? Is that really why you don't understand the numbers? Often, we push things aside into things that are our constraints, which ends up becoming an excuse. "Oh, we don't have a million dollars to invest in an ERP, so therefore we're stuck." Right? That one example I talked about just mentioned before, a company grew from 5 to 10 million. It didn't have a new ERP system that entire time, right? They needed one, just to clarify. They needed a new ERP system, but it didn't have to go in. They were able to get the growth without it despite that being a perceived blockage as to why they weren't growing. So that's the type of stuff that's the, what we like to see with, is when you create those stretch goals, it starts forcing yourself to change your mind, to change your habits, to then get to that new destination that you really want to be.
Suzanne Hanifin :And again, this podcast is really about leadership because it starts at the top, but it's not one person. It has to be the team to get by. How do you deal with it if half are in and half are out?
Carl Cox: Well, you nailed that. Half. One of the fascinating things studies show is that 51% of your management team are going to actively sabotage your plans to grow. Yeah, 51% of managers are going to actively sabotage your plans to grow. Okay, wow. Now, think of why they're busy. They didn't come up with the plan on their own. They weren't allowed to be a part of the strategy to get it done, and their incentives are not based on that new plan. It's based on the old regime. So why would they want to change? They have no incentive to change. So a part of our process that we do when we, like for example, do a strategic retreat, I tell them very clearly, we are not done if they have more people outside of that team that are responsible for getting things done, saying, "All we are doing today is setting where we want to go and maybe set some high-level strategies or journeys to get there. But the next step is we're going to engage our team to help them figure out how we're going to get there." Once again, strategy is just simplifying what's, again, for terminology sake, I'm sure listeners know, but just in case you don't, we have a beginning point, we have an endpoint, our destination. In between is how you get there. That is called strategy, right? A strategic plan is literally a collection of strategies. If you don't have your management team who's going to execute the plan get involved with it, they're going to make sure it doesn't get done. And they're not going to do it in ways you expect. They're going to say they're too busy. The number one reason why plans don't happen is because people say they're too busy. They go right off the strategic retreat, the wonderful wine, the nice meals, the wonderful views they had at the place and location, but they go right back into their business, start worrying about their customers, they worry about suppliers they're not getting product from or services from, they worry about cash, right? They worry about human resources, people they forget about where they want to go immediately, like it's almost immediate, right? Because they go right back into their own habits. So what we do is to help, once again, to help defer that is we make sure there's buy-in, and then afterwards, the process is then we come up with an agreed-upon plan. Now, just to clarify, this isn't saying as the CEO or leadership team you can access and say, "Oh, now it's your responsibility." No, no, no, no, no. It is your responsibility as a leader to make sure it gets done and that's a good plan. But you want to make sure there's buying and you want to listen and you want to get engagement, and that's what a big part of increasing success on getting to your new place
Suzanne Hanifin: And so, you're not just talking about Acumen; we go away every year for our annual retreat, and we do discuss our goals and strategies. However, if we're not discussing it every month, every quarter, and measuring it, you're absolutely right, things won't change. We're a small company, so the larger and more complex it becomes, your role in this is not just a one-time involvement; you're involved throughout the process.
Carl Cox: That's right. Yeah, we do two things: help design world-class strategic plans and help keep them accountable to get it done. You know, this may sound bad, but my reputation is on the line if people don't get things done right. So, I don't want to be just known as the world's greatest facilitator; it's nice to have, to get paid great money just for facilitating and having no responsibility. But that's my number one strength in StrengthsFinder; I'm looking at the wall over here, and it says responsibility. So, I feel when we come up with a great plan, we have to get it done. And so, I'm very well-designed. So, what we also do is help organizations design a process and accountability plan, for lack of a better term, to make sure that they're working on things. And when we do that, the success is absolutely phenomenal because we change, once again, people's habits. You'll recognize this, Suzanne, anyone who's listening would recognize this. What's typical if you do reviews, and let's say you do it quarterly, what typically happens? March 31st coming up, we have our strategic review in the first quarter. You, Suzanne, ask everybody, 'Hey, have you got your goals done, right?' And what's it like? 'I'm working on it.' And overnight, like getting a tax return done, they work really hard to get something to check a box to say that they worked on that specific measure. That's not the way things are supposed to get done. So, we create weekly habits, sprints we call them, to create weekly habits to help make sure that organizations are moving, like, if you think about it from a football game, like we want to have them move 10 yards each week, as opposed to trying to do a Hail Mary at the end of the quarter, which is what most organizations do. And when we do that, our execution levels are way more successful because we're focusing on what we can control rather than this crazy outcome at the end. That, once again, I'm not saying it doesn't sometimes get done well, but most of the time, it doesn't. And that's what is a big game changer. And what's fun is when you work on it every week, you start making little changes to it. Oh wow, I learned something here, like you don't have time to think deeply when you get it done and crash it the night before it's due, but you do when you work along the way and iterate. And so, you end up getting the best, and often you end up getting it done earlier. That's what's really fun is when people are like, 'I'm ready to move on to the next step because I've actually completed energy and effort each week.' "
Suzanne Hanifin: Yeah, and you know, it's interesting hearing this because it makes me think. You call it habits; I call it behavior-changing. Those small behaviors or those small habits, the outcome is huge, and you can do it in your own life. Like with exercise, just one more sit-up, wow, pretty soon that's so easy now. It makes sense when you break it down. So, I have one question, which is about you bringing it back to you. What advice would you give your 20-year-old self, Carl, on your career in leadership?
Carl Cox: You know, what's interesting is I was just asked this because I passed that wonderful 50-year-old mark, and congratulations. Yeah, thank you. And I am more grateful for that today than when I used to think about getting here 20 years ago. I was like, oh no, I'm gonna be 50. And here we are. It's a big thing, you know. You know, I'm very grateful. I feel like I've been very grateful for things, but I would say think bigger. Don't, and then two, find mentors and coaches along the way to help give you confidence and then help keep you accountable. And those two things, I wish I did a lot more earlier in my career. It was interesting. I very, very reluctantly had my first executive coach in my early 30s, and he was wonderful. Like, he really opened my eyes to so many different things. But it took me that long to get what I call an official mentor, you know. And now here, with my current company, five years in, I've had five different coaches. Why? Because I'm trying to accelerate our success, our progress. And when you're alone at the top, this is anyone who's listening to this knows this, as a CEO, and this may sound bad, but people don't fully tell you the truth as a CEO anymore because their paycheck depends on it. So, they will tell you what you want to hear, but they won't always tell you the full truth. And then sometimes, the inverse is you can't tell them the full truth either, right, because you're concerned about losing them, right? So, there's this game. And how I ran this for the first time was, I remember being a controller at a publicly traded company and saying a joke, and I thought it was funny, and a group of 10 people, and like a couple of people kind of laughed, but they didn't like, they didn't really laugh. They just kind of, but I still thought it was a funny joke. And so, I remember becoming a CFO for the first time, and I remember repeating it, and all of a sudden, everybody in the room started laughing, like loudly. And I was like, things are different now, right? Absolutely right. So, this is the reality as a CEO, as you recognize, and if you do, know this, is that things aren't the same when you're in a leadership role. And so, finding people you can trust outside of your organization to mentor you, to guide you, and help keep you accountable will help you reach those goals. Because otherwise, once again, you won't change your habits; you'll go back to your ordinary things. And I just, once again, looking back, I wish I embraced that more because who knows what we could have still accomplished. I'm once again still grateful for everything that we've done. I've not made a lot of things with intent, knowing I could have, quote-unquote, had more financial gain because it was the best decision for our family to make some of these decisions along the way. But, you know, people have to measure their own success how they are. Once again, that's why we have our "Measure Success" podcast, you know, how do you measure success? But I think there's so many things. And what it is, I think, is to reflect, continue to reflect at least on a consistent basis, and hire a coach and do it, like Darren Hardy said, you should be investing 10% of your revenues into basically self-improvement. Well, one of the ways to do that is by coaching, you know. Yes, you could do it cheap by buying books and some DIY, but a book doesn't talk to you, right? A book doesn't know your specific challenges that you have. And when you have somebody really challenging you on the individual parts and allowing you to ask the questions you're afraid to ask your own staff and employees and leadership team, then you're going to hit some different results that's super extraordinary.
Suzanne Hanifin: Absolutely, you truly encompass what we're trying to achieve here with hiring for good, because again, it's greater than ourselves, right? So, when we talk about things like giving 10%, investing in yourself, holding people accountable, and having others hold you accountable, what does that mean for you when it comes to looking at hiring for good?
Carl Cox: It's interesting, I'm a big believer once again in hiring people who have values. One of the things I learned, I'll go back to Lightspeed where I learned how to do this well, was we had a set of core values like a lot of companies do. We actually had key behaviors which defined what our core values meant. Then, we would ask them to write it up when they applied to be a part of the company. I remember one time we had this incredible person who was considering being a part of the company. I can't go into details in case they happen to be coincidentally listening to this. This incredible human being, this person already thought they were hired due to connections, but we read their core values write-up, what they wrote, their opinion of our core values, and it was just poorly written and poorly done, really bad. Like we would have entry-level factory workers with a higher level position that they did not write with the same quality. We had the courage to say no. That, to me, is what it means to hire for good, right? When you are hiring people who are matching not just your doing but your being side. That is awesome. It's awesome when people make the right decision and you know this based on what you do, your career. People typically leave because of their managers, right? Or for a better opportunity, they're not learning anymore. When you hire people, but we get rid of people also because, at the end of the day, they're jerks. We don't want to work with them. It's not worth the performance to get a diva, so to speak, within your company if they can't fit in or it will be a short-term burnout, right? And it's just not worth it. I know you have so much success, your team does, and because you have such a high retention rate with people that you help recruit for. I love how you do that, right? Because you're hiring, at the end of the day, for good. You're trying to make sure you're hiring the right match for that organization. I think it's super important. Each organization is different. So, a person who might be terrible at another place is going to be fantastic at Company B, and that's what's so cool. When people understand their values, understand when you don't document those things, you leave it to people whatever they decide to do, right? It's in the absence of a presentation. It'll just be based on what people think, and what's bad is over time it gets worse, right? In the absence of information, people get negative, not positive, and so typically cultures end up dwindling and getting worse, and people then it becomes the only reason they're around there anymore is maybe because the company's successful and pays wages, but that's the worst thing. There's a term I heard a while back called CTC, which just meant "cut the check," and this person I know very well had terrible management. He was in it for the long run. He's like, "I'm going to smile and wave. I'm going to do my job, but I'm not going to reach out anymore. I'm just going to have them cut the check." You want to make sure you don't have an organization like that. Now, at the end of the day, people are still working for you because they need to pay for their mortgage and for the rent and for their car payments, but hire the right people that care more about that, and then you're going to have the right team for the long run.
Suzanne Hanifin: Oh, absolutely! Again, you're speaking my love language because we talk about this alignment between goals and values, and if that's not there, it doesn't matter what someone's pedigree is, they're not going to be a good fit. So, on that note, Carl, thank you so much. And before we actually dive off, could you tell me what your book is about?
Carl Cox: It's a great journey. This was a two-and-a-half-year process of writing a book, and it was hard. It was not an easy process. My first book was called "The Seven Sails of Success," and it outlined seven ways of doing what you need to do to execute strategic planning better. I was close to production, and I pulled it back because it didn't feel right. So, I went back to the drawing board for quite a while, and we started changing some of the terminology we had. That's when I decided to write it more like a fable. I wanted the reader to feel like they're in this experience, you know? It's their story, their story of being an entrepreneur, being a business owner, and having pressure to grow but struggling to grow, having problems with people, facing challenges at home. The story follows Jack and how he runs into a cafe and happens to luckily run into a consultant. Along the way, that consultant gives him guidance on best practices, and you hear and learn about his story. What was really amazing was when one of my clients, whom I had just met, read the book. He called me a few weeks later and said, "Carl, we only met for a few hours, but how did you write this book about me?"
Suzanne Hanifin: What a compliment, what a huge compliment.
Carl Cox: We're excited about it. It really resonates with the right people. I encourage you to read the story. It's available on Amazon, Barnes & Noble, and Audible. It's a fun, easy read. Here's a fun anecdote: Someone from LinkedIn, an executive there, received the book. Initially, they thought of using it to help them fall asleep because they had been having trouble sleeping. However, they ended up enjoying it so much that they had to put it down and get another book to help them sleep. That's one of my favorite backhanded comments! It's an engaging, enjoyable book with real content and practical advice that helps you reach your destination.
Suzanne Hanifin: Again, I think this really speaks to the idea of hiring for good, that it's bigger and you can affect a lot of people and a lot of change. This has been wonderful, and I do want to highlight your podcast too. Could you give us the name?
Carl Cox: Measuring Success Podcast
Suzanne Hanifin:. Measure Success and I assume it is on most of the platforms. I have watched a number of them, and they're really insightful and good. And you are too, Carl. Thank you so much for joining us today. Reach out to Carl Cox 40 Strategy to really, again, change those habits, change that mindset, to really see what is capable. That's inspiring. Thank you.
Carl Cox: It's been an absolute pleasure being a guest today.