Welcome back to count me in,

IMA's podcast about all things affecting
the accounting and finance world.

I'm your host Mitch Roshong and today
you will hear from Sylvana Caloni,

as she joins us for
episode 142 of our series.

Sylvana is a former equities fund manager,

a professional certified coach and
author of the book, Humble Crumbles.

She was an executive vice president when
she was privileged to partner with an

executive coach.

She is now a leadership consultant
committed to paying it forward by enabling

clients to make an impact at their
companies and in their communities.

In this conversation, you will hear
Sylvana discuss the value of failure,

the benefits of clear communication
and ways to propel business.

Let's head over and listen to her now.

Sylvana,

I just want to thank you so much for
coming on the count me in podcast today.

Thank you, Adam.

I really appreciate the opportunity to
speak with you and to explore failure

and entrepreneurship and all sorts of
different ideas coming from our book,

Humble Crumbles.

So speaking of your book, Humble
Crumbles, you say in that book,

failure has a purpose and
failure's a part of the process.

So can you just start by giving us
some more insight into that statement?

Yeah, absolutely.

So I guess we see across different
cultures and across different

types of businesses, if
you like and academia,

that there is a fear of failure. And we,

as individuals often are constrained
in what we do because of that fear of

failure.

It may be so great that
we prevent ourselves from
jumping in taking the leap and

starting up a business, or perhaps
we have started the business,

but because of that fear of failure and
because of a fear of not meeting the

commitments we've made to our
stakeholders, et cetera, again,

it constrains what we can do.

So if you look at tech
companies, for instance,

you'll often hear the phrase
fail fast, fail often,

or if you look at scientific
revolutions and innovations and

how things have pivoted during
this pandemic, actually,

if there had not been failures,
there wouldn't have been learning.

There wouldn't have been
multiple iterations.

There wouldn't have been new responses
to the challenges that are out there.

So for Paul O'Donnell my co-author and I,

the idea that failure is part of
the process is that we do need

to sort of remove ourselves
from that view that

it's first time only time,

and we're going to be successful
from the get go, because in fact,

most successful businesses have
started out in some other form in their

initial iterations.

And it's the ability of the business
owners and entrepreneurs to be

flexible and to pivot and, you know,

take on constructive criticism or
take on impartial advice to modify

their product or service, which means
that ultimately it is successful.

So when you look at these leaders
who are having to transition and fail

and become more successful, how do you,

you know, how do you understand what
makes them tick? What do you, what,

what can we do to, to look at
these people and see what can,

what can cause you to fail and keep
coming back and keep coming back?

It's a great point that I think one of
the key points we're trying to make in

Humble Crumbles it's
that the failure of the

business is often attributed
to external factors.

So someone will say, well, you know,

the economic environment
deteriorated or technology changed

or legislation was too
prohibitive. And that's true.

I mean,

absolutely there can be external factors
that impact the success or failure of a

business. But what I found when I was
an equity analyst and funds manager,

was that more often than not the
failure of a business was to do with

the owners or the leaders,

the management of the companies and the
problems I often saw were whether they

were not self-aware. So they
didn't have a sense of, okay,

well what makes me tick? What, what are
my drivers? What are my motivations?

How do I make sense of my world?

And in having that lack of self-awareness,

they're not then able to
engage successfully with
others because they take the

view that well, it's my way
or the highway, or this is
the way the world works.

So they don't have an
appreciation that their own norms,

standards, practices, ways of
behaving are not universal.

They could differ with other people
because other people have different

cultural backgrounds, ethnic
backgrounds, gender backgrounds,

it could be a different set of,

drivers within an organization.
And if at what we show in the book,

Humble Crumbles, and it's
full title is Humble Crumbles:

Savoring the Crumbs of Wisdom From
The Rise and Fall of Humble Pie.

We share Paul O'Donnell's story.

So Paul is my co-author and Paul like
me had come from the financial services

world. We had both worked
at Bankers Trust. So BT co.

Us company. In fact,

even though we were both Australians
and you can hear that in my accent.

So we were working in Bankers
Trust in Sydney, Australia,

and Paul eventually left BT
and started up a couple of his

own businesses.

So he's a serial entrepreneur and his
first couple of businesses were in what

you might call financial adjacent. So
they were similar types of businesses,

you know, financial advisory or
publishing a financial material,

fundraising, that type of thing.

And then he wanted to go into a business
that was more real in the sense of

making something so humble pie was a

business that manufactured
pies for the retail sector.

And then ultimately also he
got into wholesale. So it was,

it was pies that we eat sweet
and savory pies that we eat.

And he came from that financial
services background with the number of

ways of seeing the world behaving
and business traditions, if you like,

or business practices that
certainly worked for him,

but there were others that were
more relevant to financial services,

but not so much to a factory
where he had people in the

factory kitchen making the pies or
sweeping the floors or delivering the

pies to the shops, et cetera.

So what we found Paul
was blindsided in that he

just assumed for instance, that the
factory workers would, like him,

have a view around equity
as a way of incentivizing

behavior or around bonuses
as a way of, you know,

promoting work, et cetera. Whereas
these people had different concerns,

different cares, you know,
for them the weekly pay pack.

It was what was really important,

not some notion of equity or a
bonus at the end of the year.

So the blind sidedness or the
lack of Paul's self-awareness,

which he courageously,
I have to say. I mean,

he fesses up basically in the book and
looks at some of the errors he made

with. I think,

I think he's very generous and very
courageous in doing that because what he's

doing is he's demonstrating how
sometimes the very things that we think

are our strengths,

if taken to an extreme can actually
turn into a weakness or can

turn into a vulnerability
in a negative sense.

That almost makes me think
of too much of a good thing,

becomes a bad thing when you say that.

Absolutely. Absolutely.
And to your point earlier,

and I guess I went a little
off base, but you're asking me,

how do we know if managers
or leaders are likely to have

failures or create phase?

And my point about the
self-awareness was that often

what I would see when I was an equity
analyst is when a manager or leader of a

company got onto the front
pages of Newsweek business week,

wall street journal, quite
frequently, thereafter,

the company would go down the tubes
or at least would not do as well.

And that was because those
leaders were very egocentric.

They were very much about, you know,

puffing their own chests and they weren't
necessarily engaged with their own

teams and succession plans
and understanding the
different communication styles

or the different working
styles, or, you know,

what were the values of the firm?

How did the employees feel
aligned with the firm, et cetera?

So where there is a high
likelihood of failure,

because as I say, the leader
or the business owner,

the entrepreneur isn't sufficiently
self-aware to know that his or

her way of seeing the
world is not universal.

Other people respond differently.
Other people have different standards,

different norms, different practices.

That's really interesting that you say
that, there's even in the sporting world,

there's a video game called
Madden and the person who would be

highlighted each year,

the next year after they were highlighted
on the cover of that one would have a

very bad year as in terms of
their performance in the game.

And I wonder if it's that same kind of,
thing that you're mentioning about that,

where they're so focused on themselves
that they lose sight on what they're

supposed to be doing from day to
day. And that, that self-awareness.

Yeah, I think so.

And sometimes they can generate a
sort of a false sense of security

or a complacency actually, often
you find that people become,

and we mentioned it earlier
about too much of a good thing.

Sometimes people become
so confident in their

strengths that they just think
they're infallible, you know,

that they walk on water or that,

that particular way they've done something
works in all situations. But again,

going back to that key point of
self-awareness, if you're self aware,

you'll recognize that the
model you use or the way you

solve a problem is relevant to a
specific set of circumstances and may

not be relevant across the
board. And if you are self-aware,

you're more likely then to be
curious and ask other people,

well, how do you see it? You know,
how would you approach this problem?

What am I missing out on? Where
am I blind here? You know,

I've been successful in this thing before,

but tell me what you think might be
different this time around. And, in fact,

that's another point we make frequently
in the book, Humble Crumbles is that,

you know, for you to succeed, you
need, you, you clearly need conviction.

You know, entrepreneurs
believe their stuff, right?

They believe that their product or
service is going to solve a problem that

exists out there, and
they can become again,

too much of a good thing in that they
can become so stubborn about that idea,

that they don't do the testing,
learning, and tweaking, or the, you know,

the shifting in, well, how
could this product be better?

Or how could this service not
be working here? You know,

what are the nuances of this particular
market or this sub segment of the

market? So that idea of
continually testing and tweaking,

being curious, asking
for impartial advice,

not being offended,

if someone sort of mentioned to you that
there's some aspect of your product or

service that, you know, just
doesn't work or it's complicated,

or, you know, doesn't
really meet the demand.

So it's almost like I hear
you saying that, like,

things like clear communication and
connections are like a very essential part

of business.

So how can you like nurture your network
to make sure that you have those people

that you can have those almost
fierce conversations with to,

to be brutally honest, to help your
business succeed and go further?

Yeah, absolutely. That's,
that's a great point.

So the networks are really
critical and, you know,

often people talk about someone's who
self-made millionaire or a self-made

entrepreneur, or self-made something else.

And I get that point to the extent
that they may not have inherited their

business or, or whatever the
successes they're millions,

but they're not self-made in the sense
that they don't do it on their own.

Nobody does things on their own.

They will have been someone who's advised
them, someone who's supported them,

someone who's championed
them, or for that matter,

there may be someone who's been an
obstacle who's criticized. And, you know,

sometimes we hear of great leaders or
great entrepreneurs who sort of had a

grudge match as it were, it was a
teacher, maybe in their youth or a,

you know,

a stern dad or someone who sort of
told them that they were never going to

succeed. So they went out of
their way to prove them wrong.

And that gives them the catalyst or
the impetus to go out and, you know,

keep working at it and improving
the product or service.

And as you say, you need a network, you
need to cultivate a network. And I mean,

that from a positive sense, I don't
mean it from an manipulative sense,

but ideally what you would do within
your network is it you'd go out and

find people who sure, are like you,

because it's easier to communicate with
people who have a similar view of the

world or a similar sense of values or
similar things that they're passionate

about,

but you also want to find the naysayers
or the people who have very different

lived experiences from you,

because that will actually help you in
terms of testing your idea and testing

your blind spots and
helping you with risk.

Because if you're only mixing with
the people who had the same ideas as

you, then you're like, it's
like group think, right?

The financial crisis of 2008, 2007, 8, 9,

to me,

a large part of that was everybody was
on the same merry-go-round and people

weren't listening to the signs
that things were going astray.

And there were too many yes people.

So the idea of cultivating a network
and making sure that you find people

who are very different from you and
have very different lived experiences,

I think is critical to success
and minimizing failure,

or more importantly, finding
that failure much sooner,

because you can, you can rebound
if you like from a smaller failure,

like a series of small failures, rather
than a massive failure, you know,

where you put your house at risk or you've
put your business completely at risk.

So I have to ask,

was Paul able to rebound from
his failure in his blind spots,

in the factory floor?

Yes and no, I mean, I guess in some cases
it's tough when your business fails.

I mean, we can't take away
from it. It, it, you know,

it does deflate your sense of
self-worth or your sense of what

you can do next.

What I'd say has been a real strength
for him in a real rebounding is that

he purposely used those
experiences to share his

story and then write this book.
And in this book, we do a sort of,

he says, she says, in a way,

so Paul narrates the story from
A-Z or soup to nuts to some

of your compatriots might say.

So he gives that story of starting
up this business from having

previously a financial services
background to moving into the retail pie,

making business. And then he,

through sharing those experiences
starts to eliminate or

reveal some of those blind spots.

And then I use my lens of both
that equity analysts background,

and also the coach and
mentor to dig a little

bit deeper. One of the examples
we use is that, you know,

clearly Paul could do spreadsheets.
In fact, he had amazing spreadsheets.

He did the three scenarios of
positive, negative, and neutral.

What he wasn't aware of was that
he has a tendency to be incredibly

positive. He's always looking on
the bright side and, you know,

as a previous salesman, he has what
some people might call happy years.

So even when he did his spreadsheets,
the negative scenario, frankly,

was still very positive. You know?

So the sales that he had projected
even in negative or neutral

environments were still overly
optimistic. And so again,

that opportunity to dig
deep and start to notice,

okay, so frankly, I'm always
positive. So who could I go to?

Who could I ask?

Where could I get some impartial advice
or a different set of eyes to look over

my plans, to look over my assumptions,

to sort of poke holes in the argument
and not take it as I say, as an offense,

or become defensive or
become even more convicted

in terms of your stubbornness
around your idea,

but taking it on the chin and sort
of thinking, okay, all right, well,

what could I do differently? And where
might that chink in the armor be?

So as we wrap up our conversation, I
wanted to come back to that word failure.

It's clear that you embrace that word.

So can we just talk about why
should we not be scared to fail?

And, you know, what are some things
we can learn from it? And, you know,

cause there's gotta be some
positives in the actual failure.

Yeah, absolutely. And,

and so I personally call myself
a recovering perfectionist.

So I'm someone that historically
would have, you know,

revised a piece of work
12 times, you know,

wouldn't have wanted to put out
something that had typos in it,

or wouldn't want to lead a
group until I had the argument

inside out upside down,
and I was the expert,

et cetera.

But what I've found is that if you
look again at some of the greatest

successes, be it in
science or in business,

they often did start from what
were failures or from an idea that

didn't reach its completion
in its first iteration.

So the thing about failure is
if you start to see failure

as just part of the process,
it's, you know, part of the,

the tweaking and the finessing,

if you like of the idea, it's just,
it comes with the territory there.

If you look at Netflix, Netflix, these
days is so phenomenally successful,

you know, the pandemic
obviously has helped.

And people being glued to box sets has
definitely been a positive for them,

but Netflix in its current
iteration is not how it started out

and its founders and CEO's and
management. We're able, again,

to tweak,

we're able to take advice or
at least test the market and

make adjustments,
modifications, et cetera.

So if we can look at
failure as part of the

process and the more we fail
in a managed sense, right?

So again, not put the whole house at risk,

but you know, grow our capacity,

grow our comfort zone
and take it on the chin.

Then we're more likely to have longer,

longer success down the
track. And we go to build in,

in ourselves and in our businesses,

a resilience that you don't have
if you always been successful.

You know, if you see that with
university students, for instance,

Paul and I mentor a number of students
at entrepreneurial schools or in

entrepreneurship,

and they may be a star students and
they're so frightened of not getting

it right. That again, they don't
get out of their comfort zone.

They don't have resilience.

So learning to take small steps
coming back from the failure

learning well, okay, so
I didn't get it right.

What could I have done
differently? What have,

what do I now see was the
thing I missed out on?

Or what do I now have experience
on, or who could I go to,

who can give me a different set of eyes
that builds resilience that builds a

new way of adapting.

It sounds like it does. And you know,

you mentioned Netflix
was able to adapt itself.

And then you think of the opposite
of Netflix, which is blockbuster,

which didn't adapt itself and ended up
not being able to continue or redevelop

into a new company.

Yeah, absolutely. And see
to me, and it's, again,

something we speak about in
the book is that, you know,

being a successful entrepreneur or
business person is about managing

opposites in some ways, right?
Because you have to have conviction,

you have to have a sense
of competence in the idea.

So in a way you're stubborn,

but you can't be so stubborn that you're
blind and that you don't take on new

information or you don't take on
legitimate concerns or things that people

point out to you. So it's that
balancing if you like of, yes,

I have conviction, so I'm not going
to be swayed from my idea just from,

you know,

someone who doesn't believe I can do
it because they don't know me very well

because they're fearful, you know,

they wouldn't put themselves
in those shoes versus well,

actually what they're pointing
out to me has some real legitimacy

because they have a different experience.

They've seen some risks
that I'm not aware of.

They have had a similar business
or whatever. So again, you,

you know, you want to reach for the
stars, but keep your feet on the ground.

You want to have conviction, but
not be stubborn. You want to pivot,

but you also wanted to develop
more in one line as well.

So again, it's balancing those opposites.

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