The Psychology of Succession Planning and Next-Gen Leadership with Doug Gray

Sam Sivarajan: 00:01

Hi everyone, I'm Sam Sivarajan and welcome to today's episode of the Future Ready Advisor. Today, I'm joined by Doug Gray, a business psychologist and executive coach who has spent over 30 years helping leaders navigate complex organizational and family dynamics. Doug is the founder of Action Learning Associates and the author of the book Objectives Plus Key Results Leadership. with deep expertise in succession planning, leadership development, and family business consulting. Whether your clients are family business owners, entrepreneurs planning their exit, or high net worth individuals thinking about their own legacy and the next generation, today's conversation offers practical insights that apply across the wealth spectrum. From succession planning strategies, to managing family dynamics around money. Doug, welcome to the show.

Doug Gray: 01:03

Thanks very much, Sam. Glad to be here.

Sam Sivarajan: 01:06

Now that you've had an interesting career journey from educator to business psychologist, can you walk us through what you do today at Action Learning Associates and how you got into this intersection, if you will, of leadership development, family business consulting and succession planning?

Doug Gray: 01:24

Yeah, there's no straight line. That's for sure. But there is a focus, which is on how do leaders develop. And I've always focused on leaders helping leaders. And that's been true in, so many things. But I guess chronologically, I spent a bunch of time in the wilderness environments as an outward bound instructor. And then as a prep school teacher in various environments, boarding and day schools. where young leaders need to get away from their parents and those voices and sometimes articulate what it means to become a leader. And subsequently in 97, started this company when doing some projects in DC. And two of my mentors, one taught at Georgetown, one taught at Hopkins. And they said, Doug, you're an executive coach. I said, really? What is an executive coach? I've subsequently been trying to answer that one. Frankly, that was a subtitle of

Sam Sivarajan: 01:56

Okay.

Sam Sivarajan: 02:01

Mm-hmm.

Sam Sivarajan: 02:04

Haha

Doug Gray: 02:21

of my dissertation, which I did in my 50s. And the point is when we think about leaders and how leaders grow and develop, we don't often think about the process they require. I suspect if you reflect on your career in a similar way, you find a half dozen mentors or two dozen mentors that you sought who helped you grow. And I strive to be that mentor for complex emotional systems like families, especially families with wealth.

Sam Sivarajan: 02:32

Mm-hmm.

Sam Sivarajan: 02:49

Yeah, and I think you hit the nail on the head. I do believe that all of us have been guided either directly or indirectly, implicitly or explicitly by people. And I think the challenge, and one of the things that's fascinated me is that... It's almost like a guide, right? If you think about it as a sherpa from mountain climbing, et cetera, that when you don't know the terrain ahead of you, we're still expected to move forward. We're still expected to navigate that. And you can either try to fumble around and figure it out on your own, which enough people do. Or as you say, in this case, you look for a guide or an executive coach that is going to help you kind of think through Think through the opportunity, the obstacles, the challenges, and maybe leverage some best practices that you yourself might not be aware of, but that the coach or the guide can provide learnings from other people, right?

Doug Gray: 03:53

Don't we see that every day in consulting and advising? Don't we see wealth advisors in particular reaching out and asking, well, who's the team of advisors that I can develop that would best serve this client and their needs? I guess I'm thinking of this in part because I've spent the last couple of days in Dallas with a client and that's their scenario. The business succession issues are what they are and the family succession issues are what they are.

Sam Sivarajan: 04:14

Mm-hmm.

Doug Gray: 04:22

I was brought in by the estate lawyers and I work indirectly with the wealth advisors to help them address those succession concerns. The main point here is don't we bring teams of advisors just like we do in healthcare to solve the most complex problems. And we do that sometimes chronologically and we sort of assume that the client's going to buy a new advisor, for instance, after a liquidity event or when

Sam Sivarajan: 04:38

Mm-hmm.

Doug Gray: 04:52

A younger person wants somebody who looks like them rather than somebody who looks like their mother, their father, uncle. And in those transitions, often people are aggressively seeking new advisors. I think all of us as professional service providers can be more active in that process, can be determining which family wealth advisors are really going to serve this client and why. Which estate attorneys are going to help this family and why.

Sam Sivarajan: 05:11

Mm-hmm.

Sam Sivarajan: 05:16

Mm-hmm.

Doug Gray: 05:21

And when we think in that team approach, it's like winning a hockey game. You need a lot of different people on a team.

Sam Sivarajan: 05:31

No, I think it's a great analogy. think that if I take that one step further, what you're suggesting is of course that you put different players on the ice at different times based on what the requirement is at that particular instance, right? What problem you're trying to solve at that point. And I think that's a really good mindset for advisors to walk into a client relationship situation saying, what is the team that I need to put on the floor at this stage? to solve what's right in front of my clients lives at this moment, right?

Doug Gray: 06:06

Well, it gives us scale. think I've met many hundreds of advisors. Financial advisors often think I can provide everything. Well, that's not my experience. No one can. Just as one physician cannot provide all the expertise, one attorney cannot. So when we think in a team manner, whether it's within a firm or externally to the best independence you can imagine for that particular client's needs, now we're really reaching out.

Sam Sivarajan: 06:16

Mm-hmm.

Sam Sivarajan: 06:22

Right.

Doug Gray: 06:35

And I think we're at a unique place in our history because we can now reach out to digital tools if we trust them, like AI tools that might accelerate that process of providing great investments and asset transfers. It's exciting.

Sam Sivarajan: 06:44

Mm-hmm.

Sam Sivarajan: 06:52

No, you're absolutely right. Now, you built your practice, around outcome-based solutions using your AdFit process. Can you walk the listeners through this framework and explain how financial advisors might be able to apply this results-oriented approach to create more accountability and better outcomes with their own clients?

Doug Gray: 07:15

Absolutely. I've managed executive coaches for decades and I've been around a lot of advisors, some of whom say, Doug's down here, Doug needs to be up here. Here's the talent gap. my word. And others say, Doug's down here, he'll never get up here. my word, right? So that's our history of education and oftentimes. Yep. And within companies, it's a problem-based orientation.

Sam Sivarajan: 07:34

development.

Doug Gray: 07:42

Well, the world of psychology and psychological research has shifted, thank goodness, in the last 25 years away from the negative stuff, away from anxiety and depression and violence. To be clear, we needed that research. But we've now assumed that Doug can flourish and that if an individual is capable of leveraging their strengths, then they can do a better job. And that's a paradigm shift. It's just unbelievably important.

Sam Sivarajan: 07:53

Mm-hmm. Mm-hmm.

Sam Sivarajan: 08:07

That's the growth versus fixed mindset, That Carol's the WEC and others.

Doug Gray: 08:10

Yeah, but it's not just an academic or short phrase. It's a lifestyle, it's a philosophy. It's something we embrace, right? On great days, we do it for our children and our loved ones. We assume that they will flourish. All of us have held an infant. All of us have had that experience of massive, idealistic and silly expectations for their huge, their futures, right? So, AdFit is a way to ask the A and the D, assessing their strengths.

Sam Sivarajan: 08:15

Mm-hmm.

Sam Sivarajan: 08:25

Mm-hmm.

Doug Gray: 08:38

And sometimes there are objective tools that are best for that individual and team. The D is how do you define a meaningful outcome? Because if that advisor or their client is not able to articulate what a meaningful outcome is for them, they simply won't do it. We're motivated by what we think is important. So the A and the D are how each advisor needs to work with each client, assess their strengths, define a meaningful outcome for them. And most folks are pretty good at that. They can articulate it. They can express it in writing.

Sam Sivarajan: 08:42

Mm-hmm.

Sam Sivarajan: 08:52

Mm-hmm.

Sam Sivarajan: 09:05

Mm-hmm.

Doug Gray: 09:08

And it'll change. What happens every meeting? That's when the F and the I and the T step in. So the F is when you open the meeting and you ask, what would you like to focus on today? And your client will present an issue or a concern, and that's the service concern. It's never the real concern. So the F, the focus is an opportunity for the advisors to ask questions, typically that begin with what and how, because these open doors. What would you like to focus on? How would you like to get there?

Sam Sivarajan: 09:14

Mm-hmm.

Sam Sivarajan: 09:25

Mm-hmm.

Sam Sivarajan: 09:31

Mm-hmm.

Doug Gray: 09:38

Those are just examples. And then the I is interventions or interactions. Interventions is a term psychologists use to look at validated processes. What might work for that outcome? And the T is at the end of the conversation or the end of the meeting. So Sam, what are you taking away from this session that you might do next? So I use AdFit all the time and I trademarked it because it adopts that flourishing model of growth mindsets and positive psychology.

Doug Gray: 10:07

in a way that's simple, simple enough. So I'll give new clients a list of the outcomes that they can expect to work toward and ask them to pick three. Because I know what they are based on research of executive coaching engagements, business coaching engagements, and family business engagements or family enterprise engagements. And to be clear, it doesn't matter if they've got a smallish company with 10 million or 50 million in the

Sam Sivarajan: 10:28

Mm-hmm.

Doug Gray: 10:36

annual revenue or net assets, it doesn't matter if they've got 500 billion. It doesn't matter if they've got a family office or they've got multiple divisions. They're still dealing with the issues that are listed. But once people define a meaningful outcome, then we can work together. So it's a framework. It's a structure that has been incredibly useful for hundreds of people.

Sam Sivarajan: 11:00

I'm a big believer that structure is important, right? And it's organizing the way that you think and approach meetings. And I dare say that advisors are already using some sort of structure, but you're giving it a different kind of look and feel to it that perhaps allows the clients themselves to also organize themselves around it, right? So that they, you know, that they have a clear sense of focus of what it is that that meeting or that set of meetings are meant to achieve to solve the particular problem at hand.

Doug Gray: 11:32

I think you're right. And I think most advisors are very well-intentioned. They're other-centered, other-focused. What does this client mean? And if we're honest, I think we're pretty haphazard. I don't know how many of your listeners have a process that they subscribe to. companies will define a model that they think will increase asset engagement or trust or investment in that retention, that kind of stuff.

Sam Sivarajan: 11:50

Mm-hmm.

Doug Gray: 12:00

But I don't know how many advisors have their own. I don't know how many have embraced what you just said. perhaps an outcome for people on this call is to, takeaway for them is to develop one, draft one. An example would be what are the three or four principles that I think are important in my meetings with my clients? And that'll inform them ahead.

Sam Sivarajan: 12:23

That's good. Again, I think this is, you know, for you, this ad fit process works to make your business and your practice scalable. And I think what you're suggesting is that advisors think along those same lines to make sure that their business is scalable, that as they grow and as they, as they might themselves think about succession planning, what is it that they're handing over, you know, to the next advisor or the, person that they're selling their practice to, right?

Doug Gray: 12:51

That's right. That's

Sam Sivarajan: 12:54

Now, something that I think that the listeners can totally relate to is in your work with family businesses, you've identified that keeping confidences is obviously the most important strength that you need to have in dealing with family business leaders. How, in your experience, how can a wealth advisors better navigate that delicate balance between transparency and confidentiality when working with multi-generational families? especially when family dynamics become complicated.

Doug Gray: 13:27

ask a softball question, will you, Sam? Come on. The bottom line is it's hard and it's critically important. And for a lot of structural reasons, older folks, whatever that number means, have a protective need to make sure that some information is not shared digitally or directly. And the younger ones have a compelling need to prove their capacity.

Sam Sivarajan: 13:45

Mm-hmm.

Doug Gray: 13:56

to understand or to step into a role, for instance. And the struggles often occur because people are more or less digitally trusting or more or less interested in transparency. The classic ancient example is that next-gens want transparency. Next-gens want innovation. Now they're better educated. Their friends and neighbors have more career choices than ever.

Sam Sivarajan: 14:19

Mm-hmm.

Sam Sivarajan: 14:22

Mm-hmm.

Doug Gray: 14:26

Those with higher net worth know often that they can invest in a number of different things like deaths without a protective elder knowing what that beneficiary is. So they've got opportunities for investing in anonymity that they've never had before. And what that often can do is perpetuate the conflicts. So I don't care if it's a highly paid external advisor named Sam or whomever.

Sam Sivarajan: 14:42

Right.

Sam Sivarajan: 14:50

Mm-hmm.

Doug Gray: 14:56

But the best advice I'd give anybody is bring in a third party to facilitate the conversation. It could be someone from a church or a synagogue, frankly.

Sam Sivarajan: 15:04

Between family members, you mean, and these kind of, okay.

Doug Gray: 15:08

The reason is maybe obvious, but everybody behaves better when you bring a guest to dinner on Saturday night. Everybody, right? And I won't share details, but two nights ago, I had this experience down in Dallas, and mom and dad and their son and daughter and I were at dinner. Well, we've had several meetings together. And in this dinner, it was the first time.

Doug Gray: 15:34

when the patriarch was able to express to his daughter-in-law, his daughter, his love for her in a public manner. Now, that would never have occurred if we were with the kids and grandkids, right? And it would never have occurred if it was the first meeting. When people are able to express those behaviors, it's a marvelous example of building the emotional capital.

Doug Gray: 15:57

You probably know this, but social emotional capital is a bigger driver of succession success than a written plan or an articulated anything from the best intention to state lawyer. And there's a lot of research on it, but social and emotional ties are what define successful families and businesses. Think about your history. Think about the clients that you've had that you think, I bet they have fun on Saturday nights or Sunday dinners.

Sam Sivarajan: 16:47

Mm-hmm. Mm-hmm.

Doug Gray: 17:03

And those are the things that I think most wealth advisors are frankly not qualified to facilitate by themselves. So they either need to develop the skills and they're coachable. Empathy is a coachable skill. EQ is a thing which can be quantified and measured and developed. And they can bring some strength to those succession conversations. Not in a probing manner, not in a preachy kind of a way, but in a...

Doug Gray: 17:17

opportunity. Let's have dinner and talk about what we love about the other people. And that came out kind of corny. So I didn't mean for it to sound kind of corny. It evolves.

Sam Sivarajan: 17:16

All right.

Sam Sivarajan: 17:29

Yeah, I think it's right. think it does evolve. think that's a key point. I think that you can't rush the process in many ways, right? I think that that trust that you build, that rapport that you build, that empathy that you build, I think it doesn't come on your first meeting. It comes over a period of time. And I think it's a very important point that you articulated that... it's not necessarily showing a lack of ability where you bring in a third party or a facilitator to do this. think you're just you're dividing and conquering in some ways, right? You're not putting yourself in the hot seat as the advisor on something where it might require a little bit more delicacy or having a slightly hands off type of approach than you might otherwise bring, right? I think in my view, I think what you're suggesting is that the advisor needs to step back and think about what their longer term goal or objective is to bring in that third party facilitator might mean that you retain the objectivity and the ability to give advice on your core areas without feeling awkward because now you're privy to a conversation or that you've been participating in a in a deeper personal conversation than you might have otherwise done, right? It's to know when to intervene and when not to intervene, I guess, may be the better way of putting it.

Doug Gray: 18:52

And I think we're the keepers of secrets throughout history. Counselors provide counsel when asked. And it doesn't matter if it's a feudal king in Western civilizations or Eastern. ancient history. When we think about that role, it's rarely one individual. If it is, then Shakespeare will spoof it. And we'll all see the demise. Or HBO will create a movie to focus on the theaters. I think we need those teams, you're right.

Sam Sivarajan: 19:18

Yeah.

Sam Sivarajan: 19:21

Yeah. So you've noted in when we talked before that family businesses drive about 65 % of the GDP in the US and probably something similar in Canada, yet few survived beyond three generations. In my previous work, working with Ultra High Net Worth, one thing we remarked was that there was a saying like three shirt sleeves to shirt sleeves in three generations in almost every language in the world. So it's not a North American or an English phenomenon. It exists in the Brazilian's world. exists in the Chinese world. It exists across the planet. From your experience, what are the most common blind spots that families have about succession planning? you know, that perhaps may perpetuate this three generations shirt sleeves to shirt sleeves kind of reality. And how do you think that advisors might help address these issues, whether they're working with a multi-generational family business or simply clients who want to pass whatever wealth they have to their next generation?

Doug Gray: 20:35

think it's really important to start with the fact that it's not a reality, it's a mythology. If, for instance, within three generations, there's a significant liquidity event and assets are transferred from a family or family enterprise to the community, to the grandchildren, I would call that a beautiful event. I would call that an investment in social capital or some material wealth for a community. And we see this throughout history.

Sam Sivarajan: 20:59

Hmm.

Doug Gray: 21:04

That's the reason why colleges and universities and symphony halls and local parks exist. We don't tell that story often enough. In part, sometimes it's because the family may want anonymity. They don't want to know that it's the Gray family building or entity. And that makes good sense. But that mythology is overstated. Some of the research that was done was on a

Sam Sivarajan: 21:14

That's a good point.

Sam Sivarajan: 21:20

Mm-hmm.

Doug Gray: 21:34

a number of smaller companies in one state, Illinois, near Chicago. Subsequently, it's been debunked. I think wealth advisors in particular need to know that this is not a fated complete. It's not necessarily a fear that will occur. That gives space now to the next gens to say, wait a minute, if this is overstated and I'm a G4.

Doug Gray: 21:58

Does that mean I can work in the business? Well, the answer is absolutely yes, if you're qualified and capable. Step into that role, right? And we know from other cultures that we can have a G20 or 40 in Asia and Europe and need to do so to protect the assets over time, right? Throughout wars, throughout all kinds of horrible histories. So why presume that a certain generation

Sam Sivarajan: 22:05

Mm-hmm.

Sam Sivarajan: 22:10

Yes.

Sam Sivarajan: 22:15

Mm-hmm. Mm-hmm.

Sam Sivarajan: 22:21

Mm-hmm.

Doug Gray: 22:31

will suffer an asset loss. I think it's short-sighted. Back to your question. If we have a more optimistic and hopeful belief, for instance, that the next gens can express their thoughts and feelings on important topics, whatever that means, in my world, that's called agency. So the research that I did looked at a number of competencies.

Sam Sivarajan: 22:49

Mm-hmm.

Doug Gray: 23:00

And 50 of them, we narrowed it down and then created an assessment, a 360 assessment that focused on all those. And they cluster around five systems, which are probably intuitively familiar to your listeners. It looks like this. How does the individual fit in the family? How does the individual fit in an organization? This is IO psychology. This is social psychology. But same, if you've got kids, it's also how your kids fit in the family, right?

Sam Sivarajan: 23:35

Mm-hmm. Mm-hmm.

Doug Gray: 23:38

And most wealth advisors are familiar with a model that looks at the family system, the business system, and the ownership system. Those are three houses that we often think overlap. But frankly, that's not the most important. They exist, but the learning system is the most critical system. I suspect if you think about your best clients, in other words, those who were most receptive to your learning and your expertise, they were high on their growth mindset, their willingness to ask

Sam Sivarajan: 23:48

Mm-hmm.

Doug Gray: 23:58

questions, to explore scenarios, to do case studies, to invest in educational events of some sort. And I know that those are the people who will not only do the best, but I know the top 10 behaviors that they ought to practice. And that's based on the research on the 360 and on the success playbook that I was asked to develop and on the peer groups that I was asked to develop by clients. When a patriarch says, you fix my boy?

Doug Gray: 24:32

we create a peer group, I'll say, yeah, let's go. Or can you take this digital content with these 50 behaviors and put it into a short book? I'll say, yeah. And that's what led to the most recent book, the success playbook for next-gen family business leaders. The point, I think when we take a more optimistic view of asset protection over time, now we're going back to the grand

Sam Sivarajan: 24:43

Mm-hmm.

Doug Gray: 24:58

parents or founders values and we're asking what would they want? And we're really serving the great great grandkids because we're managing the assets in a manner that's going to serve them over time. Some academics say, and there's an African saying that addresses this, we're borrowing from our grandchildren. And we don't often think in time, of time in that way.

Doug Gray: 25:26

But I love that notion. It's poetic, but it opens doors.

Sam Sivarajan: 25:32

No, that is very poetic. I agree completely. I think the point that you're making, which is what I was trying to get at as well, is that it is a mythology. It doesn't have to be reality. I think that when you're pointing to examples, and it's not just in Europe or in Asia, but also in North America, there are successful transitions of wealth across multiple generations. I think the key is they've Taken and that's what you're suggesting. They're taking a learning mindset across the generations They're trying to ensure that the values that founded this family to the extent that are valuable to keep or is still kept and respected without being stuck necessarily in the past that you're evolving in order to meet the needs not just of the future generations, the family, but the circumstances and the reality of the world around us, right? And so I think you're 100 % right that there is no reason that we need to be pessimistic about the ability to protect assets or take family wealth across multiple generations. It's just that you have to be mindful and thoughtful and proactive and learning about it. Having, sorry, a learning mindset about it in order to get there.

Doug Gray: 26:56

That's a very nice summary. You're good at this. There's a related point about the size of those family enterprises. And you probably know the answer to this, but what percent of the Fortune 500 companies are family owned? Is it 20, 30, 40, 50, or more percent?

Sam Sivarajan: 27:18

that's a great question. I don't know the answer to that. I would hazard a guess it's maybe 40%.

Doug Gray: 27:24

I think you're right. Studies I've seen indicate 35 to 40%. But we don't think that way too often. But many of your clients, perhaps, are focused on the highest of the highest net worth. And the big four firms will say, that's all we serve, which is for obvious reasons, private banking and returns. Well, think of examples, whether it's Ford or Cargill or Enterprise or

Sam Sivarajan: 27:30

Mm-hmm.

Sam Sivarajan: 27:45

Right.

Doug Gray: 27:55

I don't know what examples are coming to your mind right now, but those are massive and you don't need a 60 % majority ownership. might have a 10 % family owned majority ownership and that becomes the largest ownership percentage, which means that that Ford family maintains control of the Ford business and the company. as we think about asset transfers, we often miss that point. And I think some of your listeners might already know that.

Sam Sivarajan: 28:03

Mm-hmm.

Doug Gray: 28:25

fact that.

Sam Sivarajan: 28:27

Yeah, I think you're absolutely right. And that comes back to those three circles or three houses, the family business and the management. You you can maintain family wealth without having 100 % ownership of the business, right? I think that's exactly the point that you're making.

Doug Gray: 28:39

Majority ownership talks. That's right. And majority might be 10 % and it might be 51. Who knows?

Sam Sivarajan: 28:48

Now shifting gears a bit, you hinted at it before about the developments over the last couple of decades on the shift from the negative psychology to what has been termed positive psychology. And your research is focused on positive psychology in business leadership. Maybe explain a little bit what positive psychology is and then how financial advisors might be able to leverage this strength based approach that's inherent in positive psychology to work with clients who are facing difficult financial decisions or dealing with family conflicts around money.

Doug Gray: 29:29

Yeah, the short answer is it's a phrase that I think reflects the silly American optimism. Why assume the positivity is a result? We need some negativity often, and it is certainly the case that that's what drives every founder I've ever met. We need to risk.

Sam Sivarajan: 29:56

Not risk averse, maybe not risk seeking, but certainly not risk averse, right?

Doug Gray: 29:56

We need to be very smart.

Doug Gray: 30:01

Exactly. And as we attend, what's the old saying? Only the paranoid survive, right? Yeah, well, Andy wrote it, as you know, in one sector, but it's been adopted and applied by everybody because it articulates a lot of what we know to be true, which is that our fears define our behaviors. There's a lot of research lately in behavioral economics, which is fascinating to me because it looks and it's been recognized

Sam Sivarajan: 30:08

Andy Grove, yeah.

Doug Gray: 30:30

the only psychologists in the Nobel Prize history, right? Happened to be economists. And when we think about those overlaps between psychology and economics, what we're really getting at now is how do we adopt the values and beliefs that are going to serve our clients' goals, whatever those values might be. One of mine is that people can flourish.

Sam Sivarajan: 30:55

Mm-hmm.

Doug Gray: 30:55

one of yours may be that people should be suppressed. They should be managed. And those are just two extremings. And if we think about the outcomes we might want in a family engagement of some sort, as an example, I've got a multifamily office client with 80 clients who have very disparate beliefs about investment returns. Some want high returns quickly.

Sam Sivarajan: 31:21

Mm-hmm.

Doug Gray: 31:24

Some are more risk tolerant than others. Some are looking at political and geopolitical uncertainties and are terrified and others are more aggressive. Well, those are normal reactions. And the firm that manages those, the multifamily office firm that manages those clients, frankly has to respond in 80 different ways to 80 different risk tolerances.

Sam Sivarajan: 31:32

Mm-hmm.

Sam Sivarajan: 31:47

Mm-hmm.

Doug Gray: 31:53

Well, that's behavioral economics at play. What we're really now doing is thinking, well, how do we take the risk tolerance perceptions and the values of that unique investor into our conversations? So back to the application, the practical stuff that people can do. Your advisor team could immediately go to a website like one is via via character.org. It's free owned by the Meyerson family.

Doug Gray: 32:20

and determine what your character strengths are. These are words that describe you at your best. And you take it again and again and again, you're gonna see the validity and reliability of that assessment. I give that to many of my clients and advisors give that to many of their clients. The multifamily office I just mentioned does that for their staff and does it for their clients so that they've got the vocabulary words.

Sam Sivarajan: 32:49

Mm-hmm.

Doug Gray: 32:50

And if, for instance, you know your top five character strengths, then you can leverage them. I actually have a day timer next to me, Sam, and I write those top five every day. So today my focus is on zest. Tomorrow, creativity. Saturday is hope. And so on. When we attend to our top five strengths and focus on them on a daily basis, we are actually...

Doug Gray: 33:18

more capable of flourishing. If I were to take my top five and sprinkle them throughout the day and say from this time to this time, I'm going to focus on one of them, it would be less effective. And there's a bunch of research on that. So if we focus on one of our strengths on a day, we'll be able to see examples behaviorally, and it increases our self-efficacy, our sense that we're capable of being great advisors. And it helps us step into that value.

Sam Sivarajan: 33:32

Mm-hmm.

Doug Gray: 33:49

for others. That's an example of positive psychology at work. Does it make sense?

Sam Sivarajan: 33:56

It makes total sense. And maybe I can put that into an example for the audience, et cetera. I think that the way I've heard it in many ways is just use it as a in dealing with your child, for example, who comes home with a report card that they're getting A's in math, but a C in art. And there may be parents that would sit there and say, OK, why do you have a C? That should spend the next month or so getting your that C up to a B, which is maybe a negative psychology approach where a positive psychology approach would that be would be to work with that child to say, well, these are obviously your strengths, the maths and sciences, et cetera. So embrace that. It isn't necessarily saying, you know, don't worry about the C, but it's just saying, let's embrace and build on the A's that you've got. And I think to your point, if you apply that kind of mindset to clients, it might be that there is a client that has got particularly strong nurturing skills. You know, that is a strength for them. And it might be something and they may, they might be worried that they don't have strong enough, you know, financial planning skills, for example, and I'm making this up. But I think an advisor who is embracing and helping their clients embrace their strength-based approach might be to help that client come to grips and emphasize the fact that that nurturing element in their personality or their approach is actually a strength and to bring that to bear as much as possible in their interactions with their family, right? Is that?

Doug Gray: 35:41

What marvelous example. I love that. In part because we also need a lot of people in our cultures that are supportive and nurturing.

Sam Sivarajan: 35:49

I think we all do, right? mean, especially in our field, right? I mean, and look, you said this point before, think a lot of us in the, you whether it's a financial advisor, an executive coach, I mean, lot of what we do is nurturing, right? And I think that that's sort of what we're talking about here, that leveraging that strength-based approach is you're nurturing nurture, if you will, in some ways, right?

Doug Gray: 36:14

That's right. That's why I like that example so much. There's also this counterfactual argument, is, we shouldn't then support the needed skills or competencies in math or science. And I think that's silly. I don't know why anybody would presume that. We all need to demonstrate a certain level of competence and a certain level of skills. Well, you and I hear this talked about with financial literacy. What does it mean to be financially literate? I'm really not sure that there's an objective measure.

Sam Sivarajan: 36:43

Yeah.

Doug Gray: 36:44

Maybe because it's pretty subjective and everybody learns in different ways. And that child example will learn differently when he or she is 25 and 45. And when he or she has a hundred dollars or a hundred million, and they are going to be looking at financial literacy from very different lenses. And I think that's the real power of strength based approaches. What's the, you I both wear glasses. So what are the glasses we need today? What are the lenses?

Doug Gray: 37:11

that we need today to help us master the skills that we need to make those investment decisions.

Sam Sivarajan: 37:21

I like that analogy, Doug. I really do. think that's very powerful. You're right. think that none of these things are, it's a snapshot in time. It doesn't mean that you're fixed in stone. I think we should assume that all of these skills or strengths, like even strengths that we have, they can get better and there's a different application of that strength as we age, right? So we shouldn't ever assume that those are fixed. That's a great point.

Doug Gray: 37:31

That's

Sam Sivarajan: 37:49

Now, you work extensively with next gen leaders in family enterprises. What specific challenges are you seeing with younger generations inheriting wealth or business responsibility? And what practical strategies can advisors use to better engage and prepare these younger family members, whether it is, as I said, for running a business or simply managing the inherited wealth properly?

Doug Gray: 38:15

Yeah, the short answer is they need to practice curiosity. Not in an abstract way, like I'm going to go read about the history of Ontario, but curiosity about a real problem, something they want to learn. We do this badly in our schools. We do it badly in our families most of the time. We're terrible in religion because it's dogmatic and you have to master certain things. Well, what if

Sam Sivarajan: 38:36

Mm-hmm. Mm-hmm.

Doug Gray: 38:44

next-gens were capable of practicing their curiosity in a way that was meaningful to them. It goes back to the D and the ad-fit model. So they define a meaningful outcome. Let's say, for instance, they want to learn about philanthropy because they have a neighbor or somebody they've met who's struggling with cancer. Just a prevalent example, my wife works in the cancer industry. when I think about

Doug Gray: 39:12

philanthropic interests, often those can be nurtured. So the next gens in my world are more fun, frankly. They're younger, they're driven by curiosity. They say to me things they'll never say to their elders. Wonderful. I love the confidence, but I also love it when they do it because what they're mastering or practicing is how to master curiosity. How do I learn? So the short answer is invite curiosity.

Doug Gray: 39:37

practice curiosity, encourage them to seek mentors. The notion of a mentor being an old guy telling like Greek literature, telling people what to do mentor or mentees is silly. I often go to younger people for tech advice. Right, cybersecurity advice. And when we do, we're going to a young mentee.

Sam Sivarajan: 40:02

Yeah, we all do, right?

Doug Gray: 40:10

mentor to and we ask them those questions, whatever it is. I think this is an example of this is the power of Gemini and AI and all the tools that we've now got. Our curiosity will define our learning. Curiosity is the currency of learning. And I think sometimes we school out the curiosity that next times have. So I often

Sam Sivarajan: 40:14

Mm-hmm.

Sam Sivarajan: 40:31

100%.

Doug Gray: 40:40

ask open-ended questions. What would it look like? would it Go for a walk, literally. And in that walk, we could stop and sit on a bench and take notes or use a phone and do a voice memo. When advisors are encouraging clients privately to practice their curiosity, amazing things are going to happen. A related point is we sometimes work with the group, but we don't work with the individual.

Doug Gray: 41:04

And that's a miss. Behavioral change happens at two levels, individual and team. So you have to, advisors, you have to spend time with each individual potential investor. And don't ignore the married-ins. They married into the family system with their eyes open, I hope. Which implies that they've got some wisdom, some insights, some advice, some expertise. And that's critically important.

Sam Sivarajan: 41:26

Mm-hmm.

Doug Gray: 41:37

And a related point is what do you do with the divorces or the widows or the folks who have been marginalized for some reason? They may think they're still part of the family and the investing group may not want them to be actively part of the family, but from an advisory perspective, they're champions or they're people who could detract or derail that investment process. So when we think about a system, we need to think

Sam Sivarajan: 41:44

Mm-hmm.

Doug Gray: 42:06

really broadly and deeply. Yeah.

Sam Sivarajan: 42:08

deeply. That's very powerful, Doug. And I think that's great advice, not just in dealing with families and next gen leaders, etc. I think it's also a really good advice for advisors in their own practice, right? To think about that idea of embracing curiosity, asking questions, being the, you know, the beginner mind again, as they say, right? To think about as you're exploring, you know, perhaps new technologies to bring into your practice as you're new types of investments to offer, new client niches to focus on. think that idea of curiosity, getting mentors or advisors or guides and help is, I think, is critical advice.

Doug Gray: 42:57

I'm reaching for my little pad. Can you see this?

Sam Sivarajan: 43:04

Yep.

Doug Gray: 43:05

So I keep this in a drawer near my computer. stands for me, it stands for why am I speaking now? W-A-I-S-N. And Marshall Goldsmith shares this for many years. And the related point is why do I think I need to speak? Most advisors are too verbal. On a podcast, I'm probably too verbal.

Sam Sivarajan: 43:26

Mm-hmm.

Sam Sivarajan: 43:29

We all are, right? I think it's as guides and things, think, and part of it is that we believe that expert being the expert means that you have to be the one talking, right? And I look, and I'm still working on it, but I think the one thing I've learned is that sometimes the most powerful thing you can do as an advisor is ask a question, a deep. question, open ended question, and then be quiet and let the other person answer. And the I think too often we want to, first of all, ease the tension. So we fill in the the silence, we feel we have to demonstrate that, you know, that our rates or fees are, are justified. So we speak, but I think sometimes the most powerful moments come in that silence or when the the client is speaking. I know one advisor that told me this was brilliant, actually, that they have this client questionnaire that they use in every meeting. But the real value is on the back pages of that questionnaire. Okay, meaning that it's a blank page. And so they asked a question and where they get the real value is in all the notes that they're writing that that

Doug Gray: 44:46

It's empty.

Sam Sivarajan: 44:55

client is answering that they're getting and then when they look back, there's a gem in there that kind of gives that aha moment of what is it that this client is actually, you what is their key thing that they're focusing on, right?

Doug Gray: 45:07

What a great example. Yeah, that's so true. When I give out handouts, when I give presentations, I'll often say, flip it over. I don't care if you're a good student in eighth grade or 10th grade or college. Pretend you are today. Take out a pen.

Sam Sivarajan: 45:20

Exactly.

Sam Sivarajan: 45:24

fact, this is great. So we're coming to the end of our podcast. So I have a few final rapid fire questions that I ask all my guests. So if you're ready, number one, professionally, what is the most important lesson you've learned over the years?

Doug Gray: 45:43

Practice curiosity.

Sam Sivarajan: 45:46

Perfect, totally. And you've demonstrated that from, as you talked about at the very beginning, from your journey to doing your dissertation in the 50s, I think you're a living embodiment of practice and curiosity.

Doug Gray: 46:00

And I've been married for a long time, so I might be able to listen. And our adult children would say the same.

Sam Sivarajan: 46:06

Yeah.

Sam Sivarajan: 46:09

So number two, what is one practical tip you would offer listeners keen on applying your insights?

Doug Gray: 46:16

Can I say the same thing? Practice curiosity. In other words, ask open-ended questions. We talked about silence a moment ago. I'll give you a little anecdote. I spent nine years at a Quaker school in the DC Metro. And if you know anything about Quakers, you know that they believe in social justice and opportunities for people to sit in silence together until there's a divine reason to speak. And if they feel impelled to speak, they'll...

Doug Gray: 46:45

sometimes literally quick, but they'll speak about an injustice or a decision or a truth. Well, imagine you're at a boarding school and imagine you've got the most diverse population at any independent school in the country, literally. I don't know if you've got a better example in Toronto, but perhaps you do, because you're more racially diverse, perhaps. But the point is the faculty meetings were anchored by moments of silence. And twice a week,

Doug Gray: 47:12

in the upper school, there were kids and faculty sitting in a space, a very simple space, with rows facing each other and sitting in silence. Think of any high school kid you can imagine right now. Imagine them sitting in silence for 45 minutes, twice a week. And they might fall asleep. Or they might feel impelled to speak.

Doug Gray: 47:36

When we practice curiosity and we're comfortable with the silence, in sales, some people call it a Quaker close. When advisors say, are my fees and this is what value you will get from it. We need to stop and wait.

Sam Sivarajan: 48:05

100%. It just makes me laugh. 45 minutes for anyone to sit and quiet is remarkable in this day and age. I'll leave you with this final thought, And you've probably heard this, but one of my favorite quotes is from the French philosopher from the 1700s, Blaise Pascal, who said that all of humanity's problem stems from man's inability to sit quietly alone in a room. So I think that's...

Doug Gray: 48:29

There's a theme today. I love that.

Sam Sivarajan: 48:33

So Doug, this has been a great discussion. If listeners want to learn more about you or find your work, where do they go?

Doug Gray: 48:40

Action-learning.com is probably the best source. There's a number of other websites and links and such to books and assessments and peer groups, but action-learning.com is the best.

Sam Sivarajan: 48:52

Perfect. They will be in the show notes. So thank you, Doug, for joining us today on the Future Ready Advisor.

Doug Gray: 48:57

Thank Glad to help, hope it's useful to your listeners. All the best.