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- [00:00]
A
Foreign. Welcome to Managing youg Practice. I'm Stephen Demand with Dimensional's practice management team and today's conversation is about leadership, how advisors and firm leaders need to show up in today's human plus machine era. Today's guest is Jack Swift, an entrepreneur, executive and thought leader at the intersection of wealth management and leadership and artificial intelligence. He's also a West point graduate, former D1 athlete, former US Army Airborne Ranger, and advisors may know him as the former CEO of Tiffin, one of the pioneering AI platforms in financial services. Prior to Tiffin, Jack served as president of Crestone Capital, a wealth management firm overseeing more than 3 billion in assets for approximately 75 families. That experience gave him a firsthand understanding of the advisor client relationship, the complexity of serving high net worth families, and the operational realities facing wealth management firms today. Presently, Jack focuses on the future of leadership and is the author of the book Level 7 the blueprint for the human plus machine era. His work explores how leaders can build organizations where human judgment, creativity and trust work alongside artificial intelligence to create better outcomes. On a personal note, I've had the privilege of knowing Jack for nearly 25 years and I consider him a friend. Jack, welcome to the podcast.
- [01:34]
B
It's good to be here, Steven. I can't believe it's been 25 years, man. It's a deep friendship at this stage.
- [01:39]
A
Yeah, that's right.
- [01:40]
B
That's right.
- [01:41]
A
Well, Jack, you know, before we get into the book, I want to start by first thanking you for your service. Not just your service as a Ranger, but also at West Point. And I'm curious, that experience, those early chapters in your life, what did they teach you about leadership and how did that still show up and hold up today?
- [01:59]
B
Yeah, first, I'd just like to thank you for your commitment to the Constitution. Nobody's more committed than you are to the US Constitution. For those that don't know, still have it here. Hold up, he still has it in his pocket. Carries a copy of the Constitution with him at all times. So while I was sworn to defend the Constitution against enemies foreign and domestic, I never carried it in my pocket the way that you do. So all of us in America are thrilled to have you on our side. You know, I think when I reflect back on leadership and my early experience with it, I came to understand very intimately how imperative it is for leadership to be clear on the objectives that an organization's trying to accomplish. And I don't think there's any more importance on clarity than there is today. In the age of AI, we can get into that in more detail in a few minutes. But in the mid-90s, when I was at West Point and I was very honored to be president of my class at West Point, you know, whether I was acting in that capacity as a Division 1 athlete or just working as a platoon leader in the Corps of Cadets, when I was confused, everybody else was confused. When I was unclear on the objectives, everybody else was unclear on the objectives. And so I think the clear lesson that I learned very early is it's just always incumbent upon the leader to do really three things. Get clear, communicate clearly, and make decisions even if they're wrong. And so for me, those have been the foundational principles by which I have led, whether it's wealth management organizations, you know, my time as an executive at Janice Henderson, my time as a founder of early stage Companies, it's not always easy to be clear, but it's really important from a leadership perspective.
- [03:58]
A
I want to share a story that I heard years ago. I was talking to an advisor here at Dimensional, and he mentioned he lived in Boulder. And I said, oh, do you know Jack Swift? And he said, do I know Jack Swift? One of my favorite stories comes from Jack going to the supermarket with his kids, you know, Aiden and Bella. And when they were really young, rather than him just taking the normal route home, he had the kids at the time have to navigate back home. And I'd love to hear one. Is that a true story? I just think it's a great story. And then also, what kind of lessons were you trying to impart, you know, even to young kids at that stage, around leadership?
- [04:38]
B
Yeah, I think this comes down to a framework I use a lot with leaders today is the framework of landscape map, you know, compass. Those three things are really important to be familiar with. And I'm not talking about landscape in a traditional sense necessarily, but the application is the same. So with kids, you know, my kids first moved to Boulder County. They were really young, and they didn't know their way around Old Town Louisville, where we live. And so, you know, they were in their head a lot because they were at new schools and they were involved with activities. And so they were thinking about things that were really important to them. Maybe they were in devices, too, but they weren't always aware of their surroundings, the landscape in which they were operating. And one of the ways that we would practice navigating is we would use this old Coca Cola sign that's in the middle of Louisville. It's an old from, like the 1930s. It's painted on the side of a building, and if they could find their way to the Coca Cola sign, they knew there's like three, you know, three blocks to the west and two blocks to the north, they'd be able to find their way home. So it was a good exercise in helping them to appreciate that it's always important to understand the landscape you're operating in. You know, I think about advisors today, you know, average Advisor is between 45 and 56 years old today. Landscape's changed a lot. It's changed a lot, and it's changing even more rapidly as new advisors come into the space and they're digital natives and they're thinking about things differently. They view the world differently. The landscape of the advisory space is changing differently. And it's no different for my kids. They were in a different county, they had different friends. The landscape had shifted. So the question was, you know, what did the map look like? You know, and so the map for them was the Coca Cola sign, and then three blocks west and two blocks north, and they get to the house. And so that gave my kids the common sense to be able to navigate around this town. You know, it gave them the compass. Whether they were going to middle school or they were on their way to high school and back, they could always find their way home. And so I think that framework is useful not just for kids, but it's useful for us in the advisory space and leaders, generally speaking. And I think the mistake that people can make is to operate from an old map, you know, in changing landscape. So this would be an advisor who is, you know, not yet embraced some of the technology platforms that are available today, Whether it's somebody using, you know, MoneyGuide Pro or eMoney or Addepar or whatever it is, and they're saying, no, we're going to do it the old way. That's a very definitive, difficult way to do things because the landscape's always shifting. So the map needs to continue to change and the compass, the true north. In the case of the advisor, obviously, building trust of your clients, creating the best outcome possible for the client is imperative. That's what we're all about, right in the advisory space, the wealth advisory space. But what does that look like today with technology platforms? Like at tiffin, we developed 55 IP, which was later sold to JP Morgan. And that was really developed under Vinay's leadership. It was not something I had anything to do with other than inheriting it when I was a CEO of Tiffin. But that was a technology, remains a technology that Allows for optimization of tax implications and fee implications as advisors move into model portfolios. And so that's an example of shifting landscape, which means developing a new map compass remains the same. Best outcome possible, in this case, tax efficient outcome possible for the client. But that's a new compass relative to what was available before 55 IP.
- [08:10]
A
That's a good example. One of the lines from your book, which I really enjoyed, level seven leadership here, but stands out, is this idea of the way that you show up determines your reality. Tell us a little bit more about what you mean by that and we can start to get into state and coherence here.
- [08:28]
B
Yeah, I mean, for you, you're always in a good mood. You always bring positive energy and positive intention into every meeting and every engagement you have with anybody. I mean, as long as I've known you, 25 plus years, right? So I can't use the normal example I use here, which is like, if you're grumpy and you show up into a meeting, then everybody in the meeting's a little more grumpy when they leave. Did you impact that reality? Absolutely. Because you were in a bad mood. Right. If you show up and you're positive as you always are, Steven, then everybody in the meeting is going to be in a little more positive place. And did you optimize the outcome of that meeting? Yeah, you did. You created a reality that was a little more positive, that allowed for an optimized outcome when it came to the meeting, decisions that were made, or people's experience in that meeting. So that's a simple example of how we create our reality every single day. Now we can get into some other aspects of that, like beliefs, states and traits. And you know, we all have beliefs, belief systems. Most of these we've inherited from our parents or grandparents or coaches, teachers along the way. And they said something like, you know, it's all about working harder if you're not working really hard. Or, you know, they'll say something like, winners never quit and quitters never win. Now, the imperative data actually demonstrates today that people who are quote, unquote, winners in society, they quit really quickly, they try a lot of things, they learn to stop things that aren't working really, really quickly, and they really double down on things that work really well. So that's an example of a belief that can determine how somebody shows up. So if you believe that to be true, then maybe everything you do in life is super hard and you make it super hard and you're gonna work super hard because that's what you believe is required to be successful. But what if you shifted that belief and all of a sudden you decided and created a reality around? Things are easy, you know, I can acquire more clients, I will make more money next year. And you started to really believe that that changes your state or how you show up in a meeting. So when you're with your through your team at DFA or if you're involved with your family and you believe be a little bit better, then they probably are going to be a little bit better. It doesn't have to be hard. And that becomes a trait. It becomes who Steven is. He's the guy who always believes it's going to get a little bit better. And so he's creating his reality, his reality of abundance from a belief system that he decided he wanted to adopt or change versus what he inherited from a coach or a teacher who told him, it always has to be super hard, man. That's the only way. So that's how you create your reality all the time.
- [10:57]
A
I love that. And it resonates with me, not just as employee here at Dimensional, but as a parent, you know, and sometimes I come home and I'm exhausted. Energy is just drained. And I was talking with an advisor once and he said he sits in the car in his driveway and he says, I'm going to put on a superhero cape. And it's like an imaginary cape and I'm going to walk in that door and I'm just going to be the superhero today. And sometimes I need to be reminded of that because, yeah, I'm as chipper and excited as I am to be with you today. Sometimes I have my moments too. I'm human. But it's a good reminder that, yeah, how we show up for others and that abundance mindset is infectious too. So I appreciate you sharing that. It's going to make me a better employee, a better parent, and a better husband here.
- [11:47]
B
Yeah. You know, the thing that I hear you and I think that's true, I think the only adjustment that I would invite you to make is it starts with showing up for you. Right. So the letting go of the external validation, in this case your kids and your wife when you walk in the door, like, it doesn't necessarily matter how they react to you. They're busy with their own stuff. Your kids may have homework day, your wife may have had a bad day. Who knows? But if you, if you're showing up for you and you're putting on the superhero cape for you, then inevitably I believe you're going to shift the outcome when you walk through the door just by being sort of centered and in that superhero cape in your own mind. And essentially you're demonstrating exactly what I was trying to communicate, which is this concept of if I shift belief, I shift how I show up. If I shift how I show up, I shift the outcome. That's the linkage. It's that simple.
- [12:42]
A
That's really powerful. One of the other kind of paradigm shifting parts of your book for me was this notion of coherence. And so maybe explain what that is in plain English and then we can talk about some examples of when that goes well and when it doesn't go well.
- [12:57]
B
Yeah, I mean, for those that are listening, that enjoy physics, they'll remember coherence and what distortion looks like versus coherent fields. But for those that are less familiar with physics, I just think of it as clarity. You know, you're calm and you're clear. And so what that means in my system is I don't have 15 things going on in my head at once. You know, I'm coherent. I'm not thinking about soccer practice this afternoon for my kids. My kids are now too old to go to soccer practice. But I'm present and I'm not someplace else in my head or my body. I'm not thinking about something that happened two weeks ago in that meeting that I'm about to go into. Something happened. Doesn't matter. Doesn't matter. It matters being in the moment, getting ready to step into that meeting with the client. It matters not what's going to happen in the future. So not worrying about the future. Maybe this client or maybe this team, Something changes in the future, and it's very different. Inevitably, things are going to change. It doesn't matter. So the first thing I would say that's important when it comes to coherence is being present. And if people lose presence, it's pretty easy to find. It's right where your breath is. So you just inhale in here and then exhale out. Now here, now here, now. Do that a few times in your present. You're in the present moment, you're in a coherent state. And then next place would be understanding that coherence flows through the whole body. So it's not just your head, it's your heart and just your gut. So checking in and saying, you know, how am I feeling in my gut? How am I feeling in my heart? Do I feel clear? Do I feel present? Do I feel coherent? And in that clarity, you can start to direct Things like intent. So what's the intent of this meeting? What decisions are we going to make today? I'm clear, I'm present. I know that we need to make a decision on XYZ today. And then that allows you to focus your attention on the intent. The decisions need to be made that particular day in that meeting presence, not in the meeting that happened two weeks ago or the meeting that's going to happen two weeks from now and take action. And so those three things in order. So first, coming into coherence or clarity, mind, heart, gut, then moving into what's the intention? What do I intend to do as a leader in this meeting, or as a father or as a husband, directing my attention, attention to that particular outcome and then taking action, repeating that over and over again. Now we're creating our future. It's really cool because every time we do that in the present, that's where the future is created.
- [15:28]
A
And for an advisor listening to this, this is something they can do on their own, right before they go into a meeting. How would it work? Like incorporating it with a team huddle or like a weekly all hands meeting?
- [15:41]
B
Let's take tax loss harvesting. It happens. Most firms, not the wealth advisory firms, that's something they're going to do. That's an action they're going to work on. I mean, you can insert something else if you prefer, as a listener, but that's a subset of driving overall performance. Right? So if you go into a meeting and the meeting's supposed to be about what's our tax loss harvesting strategy? And somebody starts to say, well, you know, have you looked at the market? There's a lot going on. We could drive performance in five different ways. Stop, stop. You just lost it. That's where you lose coherence, you lose clarity. Because the meeting is about tax loss harvesting. And so that's the intention. The intention is to drive some level of performance impact through that particular strategy. How are we going to do that? We're going to focus our attention on tax loss harvesting to drive impact for our clients and we're going to take action. And so that's how we bring this sort of concept into functioning method in any wealth advisory firm, any meeting, frankly, any interaction, asking yourself right now in this podcast, what are we here to do? What's our intention? Where is our attention? Are we thinking about something else? Are we thinking about just being here in this exchange and communicating? And so that. I think it could be applied in any situation, in any wealth advisory firm, in any client meeting at Any given time. And I think when we lose it, the key piece is to bring ourselves back to that present moment and back to the attention, intention. Intention so that we can focus our att tension and drive the highest level of outcome for our client, create trust and referrals.
- [17:23]
A
The part of that that just blew my mind was this notion of being in sync with the people in the room and how, like, through that action of breathing and regrounding, our heart rates, right, get in sync. And there's like a scientific chemical syncing up that happens. Maybe, maybe share a little bit about that. And also I think the counterfactual of, like, when that doesn't go well, and the battlefield story of what happens to people when they're under stress, it was just fascinating. So if you don't mind sharing that one too.
- [17:57]
B
The first concept that you're speaking to is the concept of rhythmic entrainment. And so if listeners are unfamiliar with this from a physics perspective, it's well documented and it's not arguable. And it's the concept that if you put, you know, a dozen grandfather clocks into a room together, and they're all in different rhythms, or metronomes, like piano metronomes, and you leave them in there for, you know, an hour, they all come into sync, they all adopt the same rhythm. And so the same thing happens. And if you want to do research on this, you can go to, like, the Heart Math Institute. But the same thing happens with humans, human electromagnetic fields. We come into sync, so our hearts actually come into coherence when we're in groups. And so it's just important to recognize that that's going to happen in a meeting. And so this is where, you know, coming in with just lack of clarity or lack of coherence. Clarity, coherence. It can drive distortion in the whole meeting, right? So it's important to not allow it to happen, to be in your own clarity. And by being in clarity and with others in that space, then you're going to be the metronome that drives the rhythm for the whole group. And now you're coming into an orchestrated, coherent pattern as a group. And so this is what we see when we see things like murmurations in nature and a murmuration for those that may not be familiar. All you have to do is look up and look at a flock of birds and you can watch them move. And they move in synchronous order, right? Same with the school of fish. Because they're not worried about the broader field, they're just worried about the bird next to them. And so just reacting to, very fluidly, the bird next to you, you can move as a team. And so what happens in, you know, meetings in the wealth advisory space is in a team that's very coherent, everybody's in sync, and they're moving very fluidly. And so bring this back to a military analogy. This is how Delta Force operates. This is how Seal Team 6 operates. There's not any space for spoken word because that's too loud. And so you, you have to operate in the dark. And you're. You're moving in a coherent field essentially as one unit in order to accomplish the mission. So that's when it goes. Well, right now there, there's a bit of a flow state that has to be in place for this to occur. And so flow state means relaxed state. So it doesn't really help if we're contracted. If we have a lot of cortisol or stress hormones in our system, it. We can't. It's very difficult to access this state. And so this is the other thing I think you were asking about, which is in the battlefield, you know, we fight flight or freeze, happen quite a lot. And, you know, I was talking to somebody just this morning about this. In a battlefield scenario where, where people are getting shot at, you and I, we're in a foxhole together, we're both getting shot at. Only 50%. I think this is remarkable. Only 50% of people that are being shot at will fire back. It's because they freeze. There's a biomechanical component to this which is just amygdala hijacking for your. Your parts of your brain shut down to protect you. And some people's mechanism for protection is just freezing. Now here's the more interesting part, and I would ask any advisor who's listening to this to think about this and their team or maybe their clients or whatever it is that motivates them. If I'm being fired upon, I don't shoot to defend Jack. I shoot to defend Steven, and Steven will shoot to defend Jack. So if you're missing that motivational component to kind of, you know, to level up and really serve the client, to continue to build trust, because you have too much going on in your life and you're just. You're frozen because you're just overstimulated, then don't do it for yourself. Do it for your teammates. And that's the first step to murmuration, you know, moving as a. As a unit. It's the first step to Flow state. It's the first step to like, an orchestrated effort on behalf of a team is starting to move on behalf of somebody else.
- [21:45]
A
Wow, that is really powerful. And I have no doubt that I would want you in my foxhole because you would definitely protect me for sure.
- [21:54]
B
Not anymore. I'm not a good shot. I used to be a good. I'm not a good shot anymore, but thank you. I'll take that.
- [22:00]
A
The other story from your military days and also, I mean, something that you saw also in work environments is too, is this notion of the ammonia smell.
- [22:10]
B
Yeah. I think Stephen's referring to a section of my book, Level 7 Leadership, where I talked about smelling ammonia in a room at Tiffin. And this was when we were going through our weekly OKR objective and key results from measure. What matters is the framework meeting. And first and foremost, it was my ammonia.
- [22:31]
A
Right.
- [22:31]
B
Because I was failing as a leader. I was failing because the environment around me was moving too fast. The rate of change we're experiencing today is really remarkable. And I'm incredibly excited by this rate of change because I do believe it's the fourth industrial revolution, this driven by AI. I do believe that we are in the next Renaissance period, which is really amazing. All the things that came out of the last renaissance period, all the art, different forms of government, different forms of commerce. So it's really exciting. But that's a rate of change that my system wasn't prepared for. When I started building an AI in 2018, I had not built in technology and certainly not at the pace of AI. I come from a financial services background. The first company I started in 2007, it was an asset management company. And so the concept of three year strategic plan, quarterly objectives, how I operated, I suddenly found myself in a space in this OKR meeting where the rate of change, the speed at which we operated was weekly. And we operated in pods. You know, we operated in these smaller teams of three to six people. And we were changing that technology product on a weekly basis. And so my system wasn't conditioned to be able to operate at that speed. So when that happens and the stress hormones in your system get to a certain level, then you start to burn muscle and so it kind of smells like ammonia. I decided something had to change. I had to change as a leader, essentially. Not essentially, I had to change as a leader. I didn't want to continue to fail. But I wasn't the only one. There were others in the room that were giving off this same ammonia scent because they were also stressed. And I Put that on me. It was my lack of leadership, my inability to get clear and clearly communicate as a leader that was driving that. And I remembered smelling that same smell at Ranger School. And I remember smelling it my Plea Beer at West Point because it's such a pungent smell and it requires an extreme level of stress. But I wasn't at Plea Beer at West Point. I wasn't Ranger School. I was just in a technology company trying to build this next phase of AI tech. So you know, for me it was an indicator that something had to change.
- [24:28]
A
Yeah, my first thought when I was reading that was my first job out of school. I did teach for America, was an 8th grade civics teacher. And you definitely could smell sometimes in the room. And this isn't because they were eighth graders after P.E. but you know, you could sometimes smell the, this notion of like oh, the room has shifted here and there's heightened cortisol like you said. And so how do you bring that down I think is important, but just the self awareness to realize that that's there. The other thing that strikes me of your story is just the humility and the recognition of when things don't go your way. So I'd love to hear your lessons or your advice for advisors when they are feeling maybe unsuccessful or how do they communicate to teams when things may maybe didn't go as planned or a mistake was made. How would you advise an advisor to handle those situations?
- [25:20]
B
Yeah, I think this is page 143 in the book if I remember correctly. But I suggest that all leaders today get really practiced at saying I made a mistake. And that's number one. And number two is I don't know, I don't know the answer. And so if you think about like Jack Welch leadership or Jim Collins leadership or you know, kind of old military leadership, the leader was responsible for knowing. Like that was their job. They had to intake a lot more information. They had to have the information to make a decision. So they were the person that was responsible for knowing. I don't believe that's the case anymore. I don't believe any human can keep up with the rate of change that we're seeing with technology today. When I think about human machine team and you know people, they have all kinds of concepts. With human machine team I'm like nah, it's just pretty simple. Like it's in your pocket, that's a machine, that's your phone and you're the human. So that's a human machine team. And the average American today interacts with that machine 156 times a day. So you're in a human machine team already. So let's just get that behind us. And inside of that phone, there's a lot of AI and it's, you know, having essentially access to all the information in the world instantaneously through your phone. It's moving really quickly. So the concept that you know better is not very accurate at this stage. Because even if you know better right now, 10 minutes from now, the information in your pocket that's, you know, happening around the world could change. So getting practice at creating trust with your team by saying, you know, I don't know, Steven, I have no idea. Let's do some work on it together. That's really important. The other one is if you are matching the rate of change with experiments with your practice, for example, how you can grow your practice, better referral rates, how are we going to drive higher returns for our clients or whatever, you're going to make mistakes. If you're not making mistakes, you're not growing, you're not learning. The practice is going to fade because you're operating from an old framework, an old map and changing landscape. So saying, you know, we made a mistake, no big deal. Let's not take it personally. That's the old way. The old way is take it personally. New way is like, no big deal. It's just an experiment. It's just a feedback loop. We learned that didn't work and not do that anymore. We're going to do something that works. Cool. Let's test five more things. Let's experiment more. Now, here's the interesting part of where leadership is today. So not only is it not hierarchical the way that it used to be, whether you want to pretend that's, you know, still the case or not, and leaders don't know they're in the business now of not knowing better, but sensing better, being able to sense where things are going based on experience and intuition. That's what they need to be doing today, in my opinion. But leadership itself is migrating outward to the edges of every organization. Every single financial advisory practice today is experiencing this. Every single practice around the world, every business is experiencing this. Society is experiencing this collectively. Let me describe precisely what I'm talking about when I say decisions and leadership are happening at the edge. Anyone who is querying or asking a question of Google or GPT or Claude, anybody who's asking a question who's receiving information and is making a decision on that information is leading. They're creating an impact for an organization and the leader, the person who's, quote, unquote, in charge, is not aware of any of that. That's not how it works anymore. The decisions aren't flowing up to Steven. For Steven to make a decision based on some information, the person who's doing the questioning, who's receiving the information, who's making a decision, Stephen's never going to know about that. He's never going to hear about it. And so that's where leadership is happening today. It's at the edges, and it's happening incredibly quickly, which is very positive for overall outcomes because now you've dispersed and so everything moves a lot quicker than it used to. And it's moving with the speed of AI or technology. Because the answer is the information goes back quickly. The decisions can be made really quickly. So now we have machines responsible for speed, precision, and scale. So the question becomes, well, how do I lead as a human and what's my responsibility as a leader? If it's happening at the edges, and I'll make one assertion and I'll turn it back over to you, but it's really meaning making. It's your job to lead through making meaning of what's coming back.
- [29:40]
A
Tell me this notion of speed. I think one of the lines I remember that stuck with me was that speed without trust is chaos. This notion of you need trust. How do leaders develop that trust? And then what happens when that trust gets broken? Maybe it's not even from the leader. Maybe it's two team members. And how do you repair that trust within a team?
- [30:05]
B
How old are your kids now?
- [30:08]
A
Four and two. Elise is four and Robert's two.
- [30:11]
B
Okay, so what happens in the soccer field when you put the ball out there and just say, go for it, like it's a mess, it's chaos. And I think, you know, that's what happens in a lot of organizations, especially as they roll out new technology platforms. The illusion is the technology has the answer, doesn't have the answer. And that's like saying to a calculator, give me the answer. Well, you didn't put in a problem. So that's why this. This concept of query, gain information, and then make a decision is really important because it's incumbent upon the. The leader or the person who's. You're creating the question to be clear. So that's back to what we were talking about, coherence and clarity. Same with little kids on the soccer field. If you're really clear, your job is to prevent somebody from getting the ball in this Goal. Somebody else's job is to take the ball and move it into the other goal. Now there's clarity that you have a fighting chance of staying away from what I call the chaos curve. And for those in this call, yeah, people will appreciate this. I extrapolated this out of the J curve in private equity because I'm like, ah, J curve. When you roll out any technology, it gets worse before it gets. And so this is where trust can break down first. It starts with lack of clarity. Essentially. The lack of clarity is amplified by technology because it goes really fast. So now you have chaos that's going really quickly, so it's exponentially growing. This is what you were talking about before. The way that you neutralize that is by creating smaller teams, smaller objectives, shorter timeframes. And so the trust is built through iteration and creating clarity with a smaller group of three people or six people, not 26 people, and saying, okay, like the analogy I used before on the soccer fields with two kids, one on offense and one's on defense is pretty clear. And, you know, you have four kids, it gets a little less clear. You get eight kids or whatever, it gets a little less clear. So it's continuing to bring it back to smaller and smaller groups, more discrete objectives that are the timeframes are really short, and you build trust through iteration. And so back to what we just talked about. When something doesn't go well, saying we made a mistake, that builds trust, and then the whole group is willing to iterate more. This comes back to Jeremy Utley's work out of Stanford in a great book called Idea Flow. And the question he was asking is, why do some companies have so many good ideas and other companies just don't have any good ideas? It doesn't make any difference the size of the company, the talent pool, whatever it is. He studied this, and what he found out was the companies with more ideas have better ideas. And so the reason they have more ideas, very simple, very simple psychological safety. So it's that everybody around the table felt comfortable because they trusted one another. They're saying they just bring the ideas, just bring the ideas, bring the ideas. And the more ideas that came through, there are better ideas that emerge. And so these concepts of clarity, psychological safety, saying, I don't know, saying we made a mistake. Being vulnerable through that process, being authentic as a leader, that's how you build trust. And then trust is imperative for speed, and speed is imperative for survival, given the rate of change that we're experiencing in the age of AI, Speed is imperative for survival. And we're going through a very specific period across all industry, including the wealth industry in the United States of order disorder reorder. We're in the disorder phase. There's a lot of things that are unclear across the 300,000 advisors in the United States. Like what does the practice look like in the future? Now, if the average advisor has 300 million under management, will the average advisor in The Future have 600? Will they have more clients, fewer clients? What will it look like? There's a lot of new people coming into the space for a lot of reasons, but they're digital natives. How are they going to reshape things? And so trust is where speed is possible to match the rate of change to continue to stabilize and grow your practice.
- [33:56]
A
No, I think that's such a good point because ultimately an advisory firm, it's not an AI company, It's a trust business. Right, It's a trust company. Where do you think AI will change the work of advice? Or where does the human role become more important in the era of giving advice and working with clients?
- [34:18]
B
Part of this is going to be biased by the direction that Tiffin is going today. Even though I'm no longer involved with the company I left a couple of years ago. But I think that looking at workflow and optimizing workflow, AI is exceptionally good at efficiency. And we think about our experience with like being matched to content on Netflix or Disney plus or whatever platform you looked at, it's more efficient today than it used to be. You know, we used to poke around a bunch of different channels and hope to find something to watch. Dating, dating apps, more efficient than it used to be. Music, Spotify, more efficient than it used to be, and finding songs for your next playlist. And so I think that AI brings very simply stated, efficiency where the wealth space needs it the most is in, in my opinion, workflow. I think that we're going to continue to see agentic AI do a lot to optimize workflow, which allows the advisor to focus on trust with client and just, you know, creating the right outcomes for client. And it really frees the advisor from a lot of the administrative burden that they've been held down by, allows them to serve a lot more clients in a very personalized manner, create even hyper personalized manner, creating better outcomes for their client base, building more trust, their client base. So that's available I think today and that's what we're going to see, you know, for the next year to five years if we look a Little further out, the thing I would invite all advisors to do is to imagine what's possible. So now that you have more time, you don't have to do the spreadsheet building of the old days, then what are you going to do with that time? And I would say do the things that are uniquely human. You know, you want to build more trust with your client. Well, imagine, spend time imagining, spend time creating, spend time adapting your business in ways that better serve the client on a go forward basis. So take time to pause and reflect on what's possible. And so in this space, what I oftentimes recommend to both companies that are very large and companies that I advise and consult to that are smaller is reverse mentorship. So it takes somebody who's a 50 plus year old advisor and you partner them with somebody who's six months in the business. And this has worked very effectively with a couple of companies that I work with now. And you say, okay, person who's six months into the, into the business that has grown up on devices, who doesn't even read left to right like we do, they read, you know, the edges of the screen first. Right. How would you imagine doing this wealth advisory work? What could we do differently? Help me to imagine and you match that, that imagination of what's possible without the baggage of how things have been done for the last two decades or whatever it is with somebody's experience who says, well okay, that sounds cool, let's try that. But let's think about it this way because in my experience as a wealth advisor and doing this for a couple decades, this is what really is practical and what's not. And that's a way to sort of practically experiment with what's possible in the future in the wealth space. And so I would invite all advisors to do that.
- [37:13]
A
I like that because a lot of advisors I'm speaking with, many are hesitant to even dip their toes in the AI world. Or you know, you have some on the, on the more leading edge. But in general, given the nature of our industry and regulation and compliance concerns, many advisors are cautious. So would your recommendation there be find the more junior employees or listen to those, you know, maybe associates or folks and get them in a small pod, have them problem solve some areas like in a small localized way. How would you handle the advisor that's a little more cautious or timid with a new adoption of a new technology?
- [37:50]
B
Well, the first thing I would say to that advisor is you're in it. You're already in it. The average American is interacting with AI, about 80 times a day they're not thinking about it. But the minute you wake up and you check the weather AI, you check the traffic patterns on the way to work AI, you hit your Spotify playlist and it makes a recommendation. AI, this is not coming and it's not just GPT in the one instance. Now the difference is in those examples I've given you, it's built into layers. AI is built into layers that you don't necessarily see or can't really control. What's being unlocked now is the ability to work directly with that, the capability set of AI and to be able to unlock the knowledge that's available there at this stage. Right. And that's an interaction with the cloud or GPT or Copilot or whatever it is you want to use. And so the first thing I would say is you're already doing it. Two is now you have an opportunity to do it with intention. So rather than just letting you know, Spotify or Pandora, make a recommendation for you with the AI that's available to you. Interact with it directly and be precise and don't expect it knows what's in your head. Be clear and be very, very specific in your engagement and don't expect it's going to get everything right because, well, now that you're actually interacting directly with Claude or whatever it is, you have to understand it's got to learn like a, like a Labrador retriever or a three year old. You have to, you have to train it and start to interact with it. And so my recommendation would not necessarily be, you know, form groups of three or four younger people. I would say get an experienced advisor, connect them with one younger person. So it's a pair, two people, a pair and say pick a discrete problem. How can we optimize reporting for this subset of clients and let them. Client onboarding or client onboarding. Back to Tiffin. Tiffin just announced a partnership with Addepar. And one of the things that they talked about in the press release is the ability to reduce onboarding time significantly. So. Exactly. And so I think the problem with taking three people that don't know the industry really well and putting them on something is they're gonna come up with something that might not work in the current structure. The problem with letting people that have been in the industry 10 years or more work on something, all they're gonna do is think about the things that can't be done because they've tried em and they don't realize that technology now is smart enough to actually tackle some of these problems that they couldn't 10 years ago.
- [40:11]
A
Yeah, no, that's a good, good point. Again, it goes back to get humility and clarity, purpose, having that as a grounding base. We close out here. I always like to ask guests about the people who taught them and made an influence in their lives. And I would love to hear what's a leadership lesson from a teacher or coach or parent or mentor or someone that's stuck with you.
- [40:35]
B
The one that resonates or the one that comes up first for me is probably Jeff Wheeler, Coach Wheeler, wrestling coach at Marietta High School. And the lesson here is where we sort of started this discussion. I'll close it out, which is clarity. And I was unclear my sophomore year in high school. I thought I was a wrestler. And what Coach Wheeler knew is that I always died in the third period. You know, I was a pretty good wrestler, but I. I didn't have endurance. So he said, you got to run cross country. And I was like, I'm not running cross country. Not gonna run cross country. It doesn't seem like there's any appeal at all. He said, no, you have to do it. It's gonna make you stronger. You know, I talked a lot today about feedback loops. So when I ran my second cross country race and I broke the school record, he helped me with clarity, because there was a feedback loop there. And the feedback loop was, you're a pretty good runner. You're okay wrestler, but you're a good runner. And so he came to me and he said, look, here's the thing, man. You can continue to wrestle if you want to, but your future is in running. And so he helped me get clear with my intention, and that helped me become a really successful Division 1 college athlete. And very proudly and humbly has his name on a plaque at West Point because of that. And so I thank Jeff Wheeler for that guidance. And when I was 15, 16 years old. I love that.
- [41:46]
A
Yeah. Well, thanks for sharing that story, and thank you for your time today. I would love for you to share if people want to learn more about Level 7 leadership. Obviously, the book is a great resource within the book. I found it fascinating. It's the first time I've seen this on the first page. You open it up within there, there's a QR code to an agent that you can scan with your phone, and it takes you to a level 7 leadership agent where you can ask it questions. Like, leadership questions. And I played around with it like I was an advisor, and I said, I'm about to have a team huddle, and I have two employees that are. I'm wrestling with, you know, to rebuild trust with them. And the response will be in the. Within the Level 7 framework. So I thought that was really cool. But other ways that people can get ahold of you or your thought leadership here.
- [42:33]
B
Well, I'd love for people to either download Level 7 Leadership, the book on Audible, or buy the book on Amazon. That's great. But the thing that's funny about a book these days, and I've taught a lot about rate of change now, is as soon as you write something down, it's sort of dated, right? So, Steven, you know that Lisa, my wife, is way smarter than me, right? So she and I were having a discussion one day, and she's like, you know, you've been. You've done a lot in AI. Why don't you just build, like, a, you know, AI agent for your book so that it can continue to evolve and grow? Like, people like Steven will show up and they'll ask questions, and more people ask questions, and it'll just, you know, keep learning because it's an AI. And so her name is L7, and she is available for free on L7Leadership.com you can go and you can interact with L7. You can ask her all kinds of questions the way Steven did. Please do it helps everybody to improve their leadership, their coherence, their clarity with their team, ultimately their outcomes with their clients. And it'll continue to learn and grow L7. She'll continue to learn and grow in ways that I could never have imagined when I put the book together. And I love that. Right. She won't hallucinate because she's not. Not capable of going out and extrapolating into different areas of information. She's very focused on the content of the book, but she learns every single day with every interaction she has with any leader and the questions they ask and the things they find to be helpful. And so I am. I love it. And I also. I think I'm the. I asked my publisher, I said I'm not the first person to put a QR code in a book to link it to, like, an AI agent. And, like, yeah, we think so. And I hope more people do it. I do. Because it allows the body of information to continue to grow and develop and change. So I hope more people do it. And I encourage anybody to go to level7leadership.com. And, you know, my work today is advisory work, consulting work, and speaking work. I do a keynote about once a week. And I'm happy to speak to any of the topics that we covered today. And I thank you very much, Stephen, for the opportunity to speak to you and with this group today.
- [44:28]
A
You bet, Jack. Thank you so much. As we wrap up, I want to pull together a few major themes from our conversation today. Jack. The first is that leadership today requires a current map for the changing landscape. I love how you use that simple and powerful image of landscape, map and compass. For advisory firm leaders, the compass may remain the same, right? It's serving clients well, building trust, creating better outcomes. But the landscape is changing. Technology, client expectations and the next gen talent are all reshaping what leadership requires. The other takeaway that I got from our conversation is the way a leader shows up matters, Jack. Your discussion of coherence, breath, clarity and presence, it's just a reminder that leadership is, it's not all the strategy or intelligence. It's about the state, the state that you bring to it. And a leader who walks into a meeting, scattered, reactive or unclear, that can create more noise. It's those leaders who are grounded, clear. They help the whole room move better together towards judgment and better execution. So that was really helpful. The third takeaway is that trust enables speed. It's a fast moving world and firms can't rely on the hierarchy or the founder having every answer. So teams need that ability to say I don't know or I made a mistake. And here's what we learned. That kind of trust allows firms to experiment and adapt and improve without turning speed into chaos. And finally, given this world with AI and everything going on there, it doesn't remove the need for human leadership. If anything, it raises the bar. AI, yeah, it can help with the workflows and efficiency, but ultimately it's the human work of the advisor, the building trust, making meaning, exercising judgment, helping clients navigate uncertainty, that's even more important. And that showed through loud and clear. So for advisors listening, the question isn't simply what AI tools should we adopt. The better question is how do we become the type of leaders and teams that can use those tools well. And I hope this conversation today gave you some insights there on how to show up and be present. Jack, thank you again for joining us, for sharing your work, for helping us this think more deeply about leadership in the human plus machine era. And thank you to everyone for listening to Managing youg Practice.
- [47:04]
C
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