What does it take to be an agent of change in #internalaudit?
The times they are a changing. Are you ready??
Well there’s nobody better to talk about this topic than Richard Chambers who wrote a book on the topic and has had a 46 year career in internal audit.
You probably know Richard from his years as President and CEO of the Institute of Internal Auditors #IIA, but listen to this episode to also find out what he’s up to now, and learn some other interesting things about Richard like his favorite Beatle, and the advice he’d give to the young Richard who was starting out in his career today.
So much good information you can learn when you listen to the entire #jammingwithjason #podcast at: http://www.jasonmefford.com/jammingwithjason/
Share this with everyone you know 🙂
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Jason Mefford: Welcome to another episode of jamming with Jason today, I have a special treat for you.
00:00:07.649 –> 00:00:20.070
Jason Mefford: i’m talking to Richard chambers, who was a former president and CEO of the Institute of internal auditors somebody i’m probably sure that you’re already pretty familiar with, but we might go down some paths today.
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Jason Mefford: That you might not be expecting so whatever you do make sure that you listen to the whole episode.
00:00:26.700 –> 00:00:44.970
Jason Mefford: And you’re going to find a lot of value from what which Richard is going to share today so whatever you do, listen to the whole episode when you get value share this with someone else because they will also get value, and with that we’re going to roll the episode with Richard.
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Richard Chambers: A Jason how are you it’s great to be with you.
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Jason Mefford: i’m good, how are you Richard.
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Jason Mefford: Yes, it’s good to be with you, you know we’ve we’ve obviously you know connected a different times in our career with a with other stuff like that, and it.
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Jason Mefford: it’s a great opportunity I know you’ve you’ve kind of stepped down from the role there at the ICA.
00:01:06.840 –> 00:01:16.710
Jason Mefford: And so I know, one of the questions, people are probably asking is what’s Richard doing now right so so maybe let’s just start off, you know because you’re you’re not really retired.
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Jason Mefford: But in and if you’re like most people, I know that quote unquote retire you’re busier now than you were when you’re working full time so.
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Jason Mefford: First off maybe just get started, let people know what you’re doing now, because I know you’ve got some pretty exciting roles that you’re that you’ve taken on as well here.
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Richard Chambers: Well, thanks thanks again for inviting me on and for giving me the opportunity to talk a little bit about what’s going on.
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Richard Chambers: yeah I think a lot of people out there, probably do know that I didn’t disappear on the 31st of March I when I when I announced last summer that I was going to step down this year in March people started to say oh richards retiring, this is the end.
00:02:00.210 –> 00:02:07.140
Richard Chambers: You know, going off into retirement and I I had to correct people and and the way I would do it is to say, I said i’m.
00:02:07.530 –> 00:02:20.340
Richard Chambers: stepping down i’m not lying down, so I don’t plan to you know just go into restful bliss Atlanta stay active and that’s exactly what i’m doing announced.
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Richard Chambers: Very soon after I stepped down from the I that I was joining the board of swap internal audit services, out of the UK it’s a public private partnership that does.
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Richard Chambers: Internal Audit co sourcing outsourcing for primarily for public sector organizations in the UK slight is their first.
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Richard Chambers: Non executive director that’s exciting and then of course the the bigger news in some ways, was the announcement, the beginning of May, that I am the.
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Richard Chambers: going to join the audit board as their senior internal audit advisor and in that capacity really get to do a lot of the things that I loved about being at the AIA.
00:03:04.350 –> 00:03:12.240
Richard Chambers: Continuing to be a champion for this profession getting out there and and and speaking out on behalf.
00:03:12.600 –> 00:03:22.410
Richard Chambers: of internal auditors and, hopefully, providing some advice and wisdom along the way you know I coming up on 46 years in internal audit I.
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Richard Chambers: I was telling somebody The other day I joined internal at the internal audit profession about.
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Richard Chambers: 15 months after I ended my teenage years, believe it or not, 15 months before I was an internal auditor I was a teenager.
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Richard Chambers: So you know i’ve been pretty consistent, at least in staying with the same profession for over four and a half decades.
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Richard Chambers: But you know it’s a it’s an opportunity in the new in the new LIFE to continue to impart my insights and in my experiences and hopefully help somebody out around the world.
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Jason Mefford: yeah which is great, you know I love that what you said you know i’m stepping down i’m not lying down.
00:04:04.860 –> 00:04:11.070
Jason Mefford: write it and I think i’m i’m kind of that way my wife always kids me that i’m never going to retire i’m going to keep doing something.
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Jason Mefford: Until I do lie down in the grave and you know I can always tell I mean there’s there’s been other people that i’ve had on to you know, like a Larry harrington and.
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Jason Mefford: You know Steve get for it, and some of these people to that are continuing to still kind of give back as well and you’re doing the same thing right you want to keep giving.
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Jason Mefford: To a profession that serve you very well you’ve served it very well for 46 years, so we appreciate having you here and i’m appreciate having you on on today, so we can talk, you know and.
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Jason Mefford: You know there’s there’s a lot of things, I mean in 46 years you know again that’s that’s longer than a lot of people listening to this have been alive right and we’re.
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Jason Mefford: And I haven’t been in the profession as long as you, but we both been in the profession long enough that we’ve seen some pretty dramatic changes, I think, as well right so it’s.
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Jason Mefford: You know i’m kind of interested, you know the the last book that you did agents of change internal auditors in an era of disruption.
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Jason Mefford: Yes, which I think is is a great a great topic as well, and maybe, something that we can.
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Jason Mefford: We can talk a little bit about because, like you said, not your first rodeo you been here for a while, how you’ve been watching things change.
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Jason Mefford: So where where are we kind of going as a profession and how can we be this agent of change as as we go forward, because obviously there’s been disruption we’ve had a lot of disruption this last year.
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Jason Mefford: Where can we expect internal auditing to go and how can people start preparing for that.
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Richard Chambers: Well it’s great question Jason and you know, in the book we actually took an end, first of all I, I was very grateful to the internal audit foundation for allowing me to pen yet another book.
00:06:00.060 –> 00:06:14.310
Richard Chambers: partnered with my longtime collaborator Robert Perez who helped me along the way, with some blogs and other writing opportunities, I felt like he he could almost speak in my voice better than me so we.
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Richard Chambers: We really took that the opportunity in the book to make the case for why internal audit should continue to evolve and the reality is it’s a relatively young professional world stage it’s only been around for.
00:06:29.280 –> 00:06:38.430
Richard Chambers: Maybe 150 years at the most, but probably more like 100 and and it has been in a constant state of evolution, since its inception.
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Richard Chambers: And, and in many ways for the for the better, I think we’re a much stronger a much more valuable profession today.
00:06:48.540 –> 00:06:57.570
Richard Chambers: than we were even even 10 years ago or 20 years, so we make the case in the book that internal lot it’s always been in an evolutionary state.
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Richard Chambers: When we started, we were more the hindsight guys looking behind primarily focused on.
00:07:05.040 –> 00:07:12.630
Richard Chambers: You know, controls over financial reporting, we were the green eyeshade voucher examiners of the early 20th century.
00:07:12.990 –> 00:07:21.450
Richard Chambers: And then along the way, I think we began to enlighten become more enlightened about the the value that we could bring if we look at.
00:07:21.840 –> 00:07:32.220
Richard Chambers: operations and operational controls and that’s sort of brought about what I call the era of insight where we’re more speaking more Contemporaneously not just always looking behind.
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Richard Chambers: And, and to me the natural flow and evolution for this profession is to move to a stage where stayed in the future, where you know we’re also.
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Richard Chambers: able to look forward, you know you don’t drive a car by simply looking behind or looking to your right or left you have to keep your eye on the road ahead, and I think that’s where as internal auditors We probably have the most value to add in the in the coming decade and beyond.
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Jason Mefford: yeah because, like you said, I mean in there still I mean every every internal audit function is a little bit different some are more evolved some more mature, I mean some people use maturity maturity models to kind of describe.
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Jason Mefford: You know, I know, in the last several years, you know that I helped right there was there was kind of a part in there about the five generations of internal auditing and about.
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Jason Mefford: You know kind of moving into some of this this more foresight kind of related stuff.
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Jason Mefford: there’s there’s some people that still do have their heads down they’re still very historical in nature, which for some organizations, maybe that’s what they need, but.
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Jason Mefford: You know, like you said, we need to start you know, moving from historical to this insight to this for side.
00:08:49.680 –> 00:08:59.520
Jason Mefford: And and it’s always interesting you know because i’ve done a lot in the risk management space as well and usually you know, again, we tend to be in the details, we tend to be.
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Jason Mefford: Looking at historical data, but how, how do we transition to having more of that foresight, because it’s a different skill.
00:09:09.180 –> 00:09:20.400
Jason Mefford: And it’s almost like we have to view the world differently, and sometimes we have to view the world differently than how we’ve been trained for the last 20 or 30 years in our profession so.
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Jason Mefford: So, what are you seeing you know leaders that are moving to that foresight What are they doing different that other people can learn from.
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Richard Chambers: Well, first of all I think it’s important to note that i’m not suggesting that we that we take the place of management.
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Richard Chambers: In terms of assessing risks and.
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Richard Chambers: Thinking about future risks, I think the value of having internal audit is yet another set of eyes on the risks of an organization is you know, given how volatile and and the velocity of risk.
00:09:54.750 –> 00:09:59.790
Richard Chambers: In the 21st century, I don’t think you can have too many eyes looking looking at it simultaneously.
00:10:00.240 –> 00:10:07.890
Richard Chambers: I think, where we can add the most value is not predicting what’s going to happen to the company in three years or five years but but really looking.
00:10:08.430 –> 00:10:20.820
Richard Chambers: Looking either make and has an adequate risk management plan so that they’ve got their eye on the future and if we’re seeing things that could potentially present risks.
00:10:21.360 –> 00:10:42.150
Richard Chambers: That they’re missing, then I think that’s an opportunity for us to add value to them and, potentially, to the board if management is not inclined to be receptive to any insights that we may bring so that the chief audit executives that I think are doing the best work.
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Richard Chambers: Around the foresight piece, first of all, you don’t stop the hindsight, or the inside, I mean it’s a it’s a continuum and I would say there’s always going to be value and being able to.
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Richard Chambers: You know, identify mistakes that have been made or things that are not being done correctly or appropriately now, but I think increasingly.
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Richard Chambers: The risk that organizations face isn’t what they can see immediately in front of them it’s what lies further ahead.
00:11:12.930 –> 00:11:20.070
Richard Chambers: I think probably some of your listeners have heard me talk about this, I I live here on the Atlantic Ocean just just.
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Richard Chambers: You know not far south of Daytona beach and just a little bit north of Kennedy space Center of the bride on the ocean, and I can walk out there, you know this week was the first week of hurricane season, I can.
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Richard Chambers: walk out there.
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Richard Chambers: on the beach behind my house any day of the weekend the skies are blue and the sea is calm and I can assume that I have nothing to fear.
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Richard Chambers: Being a beachside resident, meanwhile, as we move deeper into the summer.
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Richard Chambers: In all likelihood there’s one or more fierce category three to five hurricanes churning somewhere out there in the Atlantic potentially heading this direction.
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Richard Chambers: I won’t see them I won’t even see the clouds from them, or the rising tides until the day or so before, and so, if i’m content to simply.
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Richard Chambers: Use the most basic and crude form of risk assessment that is going up to the hilltop and looking out there i’m probably going to find myself surprised, more often than not.
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Richard Chambers: So I think as internal auditors, we got to become a little bit more like you know meteorologists and other scientists who are trying to look further ahead.
00:12:35.400 –> 00:12:47.520
Richard Chambers: So that we’re not so that that we’re not leaving our organizations or companies or boards or management in a vulnerable place by not helping them look far enough out all of the price.
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Jason Mefford: One I think that’s it’s it’s a great example that we can kind of go into a little bit more because hurricanes, are one of those natural disaster things that you can foresee coming you know i’m here in California you can’t predict an earthquake it just happens right.
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Jason Mefford: I mean you, you can kind of tell based on some of the the the little tremors that are happening that may be something bigger is going to happen, but we don’t actually know until it’s here because that’s a very quick velocity event.
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Jason Mefford: hurricanes.
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Jason Mefford: You got some time for right, I mean you can kind of tell the meteorologists are seeing what’s going on in the ocean, the heat patterns, the you know the different tides and everything else, they can start to see when these things are developing.
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Richard Chambers: Well, satellite images are probably the most powerful way they know it’s happening.
00:13:34.590 –> 00:13:45.060
Jason Mefford: Well yeah because now, they can actually see it from space it’s hard to come in, they can kind of start to pinpoint the trajectory and where they expect it to hit land.
00:13:45.810 –> 00:13:53.580
Jason Mefford: And so you know, but again, like you said it’s the foresight, because, because I think one of the things that sometimes people.
00:13:54.060 –> 00:14:05.760
Jason Mefford: misinterpret is that we’re supposed to become like fortune tellers right we’re supposed to just know what it is, which is literally impossible for anybody to know exactly right so even.
00:14:06.240 –> 00:14:12.720
Jason Mefford: The hurricane they don’t know exactly where it’s going to hit land until it hits land.
00:14:13.140 –> 00:14:16.470
Richard Chambers: that’s right, the closer and there’s not anything, by the way, I you know I don’t.
00:14:16.590 –> 00:14:26.490
Richard Chambers: I don’t mean to imply at all I think there’s anything you can do about a risk like that the thing you want to be sure of, though, is that you’re prepared yeah i’ve lived through a few of them here.
00:14:26.490 –> 00:14:34.920
Richard Chambers: And I can tell you it usually takes me two or three days to get everything batten down and get the shutters up and do all those things, so the reason I would.
00:14:35.430 –> 00:14:41.400
Richard Chambers: Personally, be concerned about the risk is to give myself time to be prepared to make sure I have a plan.
00:14:42.000 –> 00:14:49.470
Richard Chambers: And that’s where I think internal auditors can be of great value to management is it, and this is what i’ve been.
00:14:49.860 –> 00:14:59.040
Richard Chambers: preaching him for several years is if we do have that that ability to help management and help our companies organizations.
00:14:59.340 –> 00:15:08.400
Richard Chambers: look further out for the horizon it’s not to prevent everything because there’s some things that are not preventable it’s to make sure that there is a plan for preparation.
00:15:08.760 –> 00:15:21.570
Richard Chambers: Is there a disaster recovery plan a business continuity plan, do you have in place the kinds of plans and controls that will allow you to minimize the impact yeah.
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Jason Mefford: yeah because, like you said you have to be prepared and again with the early warning signs, you know, a couple days in advance, you can batten down your House, you can get out of town.
00:15:32.970 –> 00:15:42.690
Jason Mefford: Right it be, because you know it’s probably coming you’re already prepared, you have a plan for it and you know you’ve gone through this before right.
00:15:43.020 –> 00:15:46.800
Jason Mefford: And so that’s that’s more kind of what the foresight is is is asking.
00:15:47.250 –> 00:15:55.980
Jason Mefford: Asking the kinds of questions like hey Richard did you know you live, you know, on the east coast of Florida, did you realize there’s hurricanes.
00:15:56.070 –> 00:15:57.840
Jason Mefford: Right, so, if I can you.
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Richard Chambers: know and risk management.
00:16:00.870 –> 00:16:02.850
Richard Chambers: Language you know the likelihood is higher.
00:16:03.390 –> 00:16:05.400
Richard Chambers: And the impact is probably higher.
00:16:05.730 –> 00:16:08.760
Richard Chambers: than when I live further further inland over in Orlando.
00:16:09.660 –> 00:16:22.260
Richard Chambers: The likelihood of having you know category three wins their lower and the impact is lower, so you know you have to think in these traditional terms of you know impact likelihood velocity.
00:16:23.190 –> 00:16:35.910
Richard Chambers: So I think these are these are things that internal auditors should keep in mind, I mean you know the number one Jason over the years, people always say, well, what should we audit, what should we audit and I have a very simple answer for that free works follow the risk.
00:16:36.390 –> 00:16:44.730
Richard Chambers: And if if the answer is follow the risk you’re not going to do that very effectively if all you’re doing is looking behind.
00:16:45.390 –> 00:16:54.270
Richard Chambers: You know risk 10 so live further out by the way, i’m also very mindful that you know that that we also should be thinking in terms of opportunity.
00:16:54.720 –> 00:17:04.800
Richard Chambers: that’s very much what agents of change the book is about is that internal that I define change agents internal lot of change agents in the book has.
00:17:05.190 –> 00:17:12.810
Richard Chambers: Those internal auditors who are catalyst for transformational change that enhance value for the organization.
00:17:13.350 –> 00:17:25.230
Richard Chambers: So that’s not just going around and locking doors, making sure doors are locked and locking doors, maybe that’s helping the company or the organization identify where there should be new doors.
00:17:26.100 –> 00:17:31.290
Richard Chambers: You know it’s not about using another cliche it’s not about being a bean counter.
00:17:32.100 –> 00:17:42.690
Richard Chambers: or even knowing how the beans are grown or harvester taking a market it’s maybe about saying hey should we be even growing beans at all, maybe there’s other crops that we ought to be thinking about.
00:17:43.230 –> 00:17:51.060
Richard Chambers: So it’s really thinking transformational Lee about how you as an internal auditor bring value to the organization.
00:17:52.470 –> 00:18:01.410
Jason Mefford: And I think that’s that’s a great point because you know traditionally in risk management in audit and compliance and these kind of functions even legal.
00:18:02.100 –> 00:18:12.750
Jason Mefford: it’s more about loss prevention right is is kind of the the idea of value preservation we’re trying to hold on to whatever we’ve already created.
00:18:13.260 –> 00:18:23.520
Jason Mefford: versus you know value creation this opportunity side of it that often usually has a much bigger risk, you know you you bring you bring up the.
00:18:23.910 –> 00:18:34.740
Jason Mefford: point about should we be growing beans, well, I come from a family of farmers right my ancestors were farmers and, in fact, one of my one of my uncle’s was a very successful farmer.
00:18:35.310 –> 00:18:43.470
Jason Mefford: And why was he successful because when everybody else in the coffee shop was talking about planting corn, and he goes huh.
00:18:43.920 –> 00:18:54.210
Jason Mefford: everybody’s going to be planting corn, which means that there’s gonna be a lot of supply of corn, what if I grow meant this year instead.
00:18:54.720 –> 00:19:06.360
Jason Mefford: And so, he he would he would zig when everybody else was zagging and he did very, very well for himself, because he was looking at that opportunity that’s.
00:19:06.750 –> 00:19:13.980
Jason Mefford: that’s again, I mean to me, you know, one of those things that we’ve got to start looking at or thinking about different is exactly that.
00:19:14.400 –> 00:19:25.770
Jason Mefford: What are those opportunities not only not just be completely concerned with value preservation, but with value growth with the opportunity side of it as well and that.
00:19:26.520 –> 00:19:32.730
Jason Mefford: lines up better with what management’s looking for anyway that’s what that’s what they’re more concerned about anyway so.
00:19:32.940 –> 00:19:42.750
Richard Chambers: Absolutely, in fact, in the book, we talk about what are the characteristics of the great change agents and our profession and number one and we heard back.
00:19:43.140 –> 00:19:53.100
Richard Chambers: From over 600 chief audit executives around the world when we did a survey at the outset of the project and the overwhelming response was business hacking.
00:19:53.760 –> 00:20:07.140
Richard Chambers: business acumen in a general sense really having a keen understanding of you know, the concepts and principles of business operations but also knowing your business, knowing the company and the industry that you serve.
00:20:08.040 –> 00:20:19.140
Richard Chambers: I would tell you Jason the number one complaint i’ve heard over the last 10 or 15 years about internal audit if I if i’m probing with management or board members.
00:20:20.220 –> 00:20:26.850
Richard Chambers: Is they’re generally complimentary and, believe me, I think we have their ear in many more instances or not.
00:20:27.330 –> 00:20:41.190
Richard Chambers: But the most common refrain is, however, that you know they’re great they’re great at what they do they’re really helpful to the company, however, I just wish they understood the business a little better.
00:20:41.700 –> 00:20:56.580
Richard Chambers: And so to me that really successful internal audit change agents out there really live and breathe the business, because if you’re going to help the business change for the better, you better understand the fundamentals yeah.
00:20:57.060 –> 00:21:00.090
Jason Mefford: Well, I think that’s a good point because it reminds me, you know.
00:21:01.140 –> 00:21:06.390
Jason Mefford: One of my positions with was with Arthur Andersen back in the day and we changed.
00:21:06.990 –> 00:21:15.090
Jason Mefford: You know, in the industry really kind of there were a couple of the firm’s Anderson was one of them that kind of changed how they were looking at financial statements.
00:21:15.570 –> 00:21:23.700
Jason Mefford: And came up with what we call it at the time the business audit Okay, the very first step of that was understand the business.
00:21:24.240 –> 00:21:28.620
Jason Mefford: And we would spend a significant amount of our of our audit.
00:21:29.130 –> 00:21:42.630
Jason Mefford: Project time trying to understand the business, and you know when I was younger in my career, I could never kind of understand that right it’s like well you know we do this, or we do that right, I understand the business, I understand the business we’re in.
00:21:43.560 –> 00:21:54.960
Jason Mefford: But do I really understand the business and those things that drive it, you know what are what are those internal and external things that really do.
00:21:55.470 –> 00:22:07.890
Jason Mefford: drive the organization that you happen to be in right everybody who’s listening and the more that we understand that that business acumen sounds like that’s what your executives want you.
00:22:08.070 –> 00:22:20.460
Jason Mefford: to know so okay we’re already expert in auditing now let’s actually understand how the business works that’s that’s why I think to you know some of the best chief executives that i’ve seen or that i’ve worked with.
00:22:21.120 –> 00:22:28.830
Jason Mefford: Are those people that actually move have moved around into different roles, or people that get other.
00:22:30.330 –> 00:22:33.240
Jason Mefford: Other hats that they wear I like to use that because, like we’re hats.
00:22:33.300 –> 00:22:40.380
Jason Mefford: anywhere right but they’re responsible for compliance so they’re responsible for risk management or they’ve done other things in their career.
00:22:40.770 –> 00:22:52.530
Jason Mefford: It gives them more of that business acumen it gives them, you know that it becomes a more rounded person, so they can have those discussions with the executives much more intelligently, because they actually get to get it.
00:22:53.070 –> 00:23:01.080
Richard Chambers: Right absolutely the other three big characteristics that we dive into in the book, because that you know the change agents in our profession or strategic.
00:23:01.680 –> 00:23:09.150
Richard Chambers: They are relationship centric and they’re innovative So if you think about that those are four very, very broad.
00:23:09.840 –> 00:23:27.120
Richard Chambers: Skills attributes whatever term you want to use, they tend to the great change agents in our profession tend to share those in common and and that’s what I think enables them to be the agents of change that that they can become in their organization.
00:23:27.720 –> 00:23:36.690
Jason Mefford: yeah well, and those are again, those are four areas business acumen thinking more strategically the relationship centric and being innovative.
00:23:37.860 –> 00:23:44.700
Jason Mefford: Those are not four words that you would typically associate with internal auditing or with auditors in general.
00:23:45.150 –> 00:23:46.620
Richard Chambers: Well, certainly not historically.
00:23:47.430 –> 00:23:48.540
Richard Chambers: Let me, let me.
00:23:48.720 –> 00:23:59.820
Richard Chambers: hasten to add that I think we are a profession that continues to evolve and that the skills that are out there today are quite impressive and in many organizations, you do have people who have.
00:24:00.210 –> 00:24:07.410
Richard Chambers: A combination, or, in some instances, all of those characteristics and that’s why I think internal audit is adding more and more value.
00:24:08.040 –> 00:24:13.860
Richard Chambers: You know we’ve really seen a shift in the way internal audit is being.
00:24:14.760 –> 00:24:25.440
Richard Chambers: Being championed in these last few years, and you saw it in the three lines paper that the I just produced last year, you see it in the eyes 2030 strategic vision.
00:24:26.130 –> 00:24:44.310
Richard Chambers: This idea that we are, we are a profession that’s moving from the value protection era to value enhancement era, and I think you can’t really expect enhanced value as much without bringing a lot of those skills that were just talking about today.
00:24:46.020 –> 00:24:51.240
Jason Mefford: very true well and again it’s you know, like you said some of the people, again, that are the most successful now.
00:24:52.050 –> 00:24:59.700
Jason Mefford: they’re already adopting and already doing some of these four things and, and this is probably to where there’s some perception issues.
00:25:00.420 –> 00:25:08.610
Jason Mefford: I think one of your blogs was something about that recently was about the perceptions that audit has to get past right for for people to start seeing and.
00:25:09.210 –> 00:25:18.030
Jason Mefford: I think some of these are some of those perceptions right they see us I I think I think what you’re going to remember better but, but you know they see us as bean counters are accountants.
00:25:18.030 –> 00:25:23.280
Richard Chambers: Right it’s kind of title was something to the effect that that enduring myths about internal life.
00:25:23.370 –> 00:25:31.620
Richard Chambers: yeah wow the awareness yeah is it you know may it was internal audit awareness month, and so it was really just sort of saying.
00:25:32.070 –> 00:25:45.540
Richard Chambers: We can do a lot of things to create greater awareness about who we are and what we do, but we also need to keep in mind that there are misperceptions or myths out there, that will persist and we have to constantly work to overcome those.
00:25:46.230 –> 00:25:55.080
Jason Mefford: Well, and there’s four areas right that, again, we can start overcoming some of those myths and misperceptions as well.
00:25:55.740 –> 00:26:06.450
Jason Mefford: beef up on your business acumen start showing people that you actually understand or you know even even take an interest in some of the stuff I mean one of the.
00:26:07.290 –> 00:26:18.360
Jason Mefford: Two of the best days of my audit career was hanging out with one of our plant managers Okay, and this was for me to understand the business better.
00:26:18.720 –> 00:26:26.160
Jason Mefford: I went through high school, you know you know undergrad and graduate degrees in college, but never taking chemistry.
00:26:26.700 –> 00:26:32.670
Jason Mefford: And then, one of our largest divisions was the chemical fertilizer plant right so i’ve got all the number, you know.
00:26:33.150 –> 00:26:43.350
Jason Mefford: But sitting down with him and having him take me for two days shadowing him explaining what’s going on sitting down showing me the chemical.
00:26:43.710 –> 00:26:48.420
Jason Mefford: reactions that were happening in the plants and what we were doing with it, and why it is.
00:26:49.050 –> 00:27:03.540
Jason Mefford: that’s the kind of stuff you know we can all do that so get more of that business acumen start showing it to people right the strategic you know again start thinking more strategic right have you read the strategic plan of your company.
00:27:04.860 –> 00:27:05.790
Jason Mefford: Hopefully.
00:27:06.180 –> 00:27:06.990
Jason Mefford: right but i’m sure there’s.
00:27:07.290 –> 00:27:08.610
Richard Chambers: Some people listening is coming.
00:27:09.060 –> 00:27:12.150
Richard Chambers: And do you even have a strategic plan for internal audit because.
00:27:12.450 –> 00:27:17.160
Richard Chambers: You know a lot of people think long term planning for internal audit is for December.
00:27:17.790 –> 00:27:20.070
Richard Chambers: And the reality is.
00:27:20.220 –> 00:27:23.910
Richard Chambers: December that’s fine that’s going to deal with this year’s risks but.
00:27:24.360 –> 00:27:32.100
Richard Chambers: You know what what’s your company going to be doing, are you know, is it going to be expanding globally, is it going to be taking on new lines of service.
00:27:32.490 –> 00:27:39.150
Richard Chambers: And do you have the skills and internal audit to be able to help or to even be able to provide assurance and.
00:27:39.870 –> 00:27:48.540
Richard Chambers: The reality is every organization that I ever served as chief audit executive, for I took the organization through a strategic planning.
00:27:48.990 –> 00:28:02.640
Richard Chambers: Exercise almost at the outset of taking on the role because it put us all on the same page and also help everybody to understand you know what the real risks and opportunities that lie ahead, really are.
00:28:04.380 –> 00:28:12.840
Jason Mefford: Well, it is, and then you know, the last two as well, and you can start working on his relationship centric right, so I know again a lot of times we’re very.
00:28:13.800 –> 00:28:25.170
Jason Mefford: transactional nature, I gotta get to the project you gotta do this I gotta do that but spending that little extra time of actually developing and deepening the relationships it’s going to go a long way right.
00:28:25.200 –> 00:28:32.910
Richard Chambers: Building and sustaining relationships based on trust is one of the most valuable things you can do for yourself as an internal water.
00:28:34.110 –> 00:28:43.680
Richard Chambers: You know I I observed in my book trusted advisors that you know if you are, you can be the smartest person in the organization.
00:28:44.040 –> 00:28:51.870
Richard Chambers: You can you can absolutely have all the expertise in the world, but if you’re not a if you’re not a well respected or liked individual.
00:28:52.320 –> 00:29:09.720
Richard Chambers: Because you’re kind of withdrawn and you’re very you’re very distant and aloof um you know they’ll invite you well if if you have all of the relationship skills, but you don’t have any expertise they’ll invite you to dinner, but they won’t invite to to give advice.
00:29:10.200 –> 00:29:25.110
Richard Chambers: So you really got to have it both you’ve got it you’ve got to be strong and relationships and strong and expertise, if you really want to become the trusted advisor or even the agent of change, which is kind of that nextel elevation of them yeah.
00:29:25.860 –> 00:29:35.490
Jason Mefford: This is great great great great information, you know as far as kind of where we’re going and and trying to again move from that value protection to value enhancement.
00:29:36.000 –> 00:29:47.280
Jason Mefford: And some of the things that we just need to start kind of working on, you know, to move the profession forward continue because, like you said we’ve been evolving the whole time we’re going to continue to evolve so.
00:29:47.760 –> 00:29:53.130
Jason Mefford: Keep evolving with it right so it’s been a fun journey so far it’s served you well for 46 years right.
00:29:53.910 –> 00:29:59.580
Richard Chambers: Well i’ve certainly seen a lot of change, you know I I was observing to someone, the other day, you know, when I look at.
00:30:00.060 –> 00:30:06.360
Richard Chambers: You know, internal audit, there are a lot of things that we have it really grown a lot in a lot of our a lot of our.
00:30:06.690 –> 00:30:14.010
Richard Chambers: processes and how you plan and conduct audits and a lot of that is still very, very much like it was 40 some years ago and.
00:30:14.340 –> 00:30:19.920
Richard Chambers: I think that’s something we have to work on that’s why i’m such a big fan of some of the agile auditing methodology, but.
00:30:20.460 –> 00:30:38.340
Richard Chambers: um but, but when it comes to technology, I feel like i’ve seen a a an absolute sea change out there, I told somebody the other day, when I became an internal auditor in 1975 the most the most sophisticated technology in the audit department was the 10 key calculator.
00:30:39.420 –> 00:30:44.250
Jason Mefford: You know, we may agree to use those absolutely I mean we were that was still.
00:30:44.280 –> 00:31:02.850
Richard Chambers: A good 10 years before you would see desktops on computers, I mean we were really we were really using the old spreadsheets I came in kind of at the end of one era and, at the beginning of the other but today’s modern internal audit department is, I think, much more.
00:31:04.470 –> 00:31:15.630
Richard Chambers: embrace this technology much better uses uses different tools for helping the helping to manage the internal audit department itself to.
00:31:16.200 –> 00:31:26.640
Richard Chambers: To help manage or to observe risk in the organization a compliance and control, so I think we have made a lot of progress there but there’s still work to be done.
00:31:27.180 –> 00:31:37.230
Richard Chambers: These are what I call by the way, the capacity multipliers, in all likelihood you’ve got more risks that you’re trying to deal with today than ever you’ve got more.
00:31:37.620 –> 00:31:52.590
Richard Chambers: verse volatility in your company than you’ve ever had to deal with in the know likelihood you don’t have a whole lot more staff you’ve probably got the same or in most cases, or many cases smaller staffs and you did two years ago, before the pandemic.
00:31:53.820 –> 00:31:59.310
Richard Chambers: And so what you’ve got to look for is, what are the what’s the edge that’s going to allow you to.
00:31:59.820 –> 00:32:08.250
Richard Chambers: increase internal lot its capacity to address risks and and control issues in the organization.
00:32:08.730 –> 00:32:25.770
Richard Chambers: Without getting extra people and that that’s where you get the the term capacity multipliers and technologies, perhaps the most obvious capacity multiplier, but there are a lot of things we can do it every day, and the way we, the way we do our work that enhances our capacity.
00:32:26.340 –> 00:32:26.910
00:32:28.020 –> 00:32:35.190
Jason Mefford: Does very much very good, very good wisdom, well, I wanted to just got a couple minutes here left Left and I wanted to kind of.
00:32:35.580 –> 00:32:49.320
Jason Mefford: go a little bit of a different direction if you’re okay with that because I know you know, like you said you’ve had an amazing career you’ve been on the stage you’ve written the books people know you for all your technical stuff but they probably don’t know Richard as a person.
00:32:51.780 –> 00:32:58.560
Jason Mefford: So if you’ll indulge me here a little and let’s let’s just get get to know you a little bit better just kind of in a quick thing, because I think.
00:32:59.010 –> 00:33:07.740
Jason Mefford: The more that people you know in this kind of goes back to the relationship centric stuff too right it’s The more that I actually get to know people as people.
00:33:08.460 –> 00:33:13.350
Jason Mefford: The more we see them as people, the more that we develop the relationships as well right so.
00:33:13.890 –> 00:33:18.060
Jason Mefford: i’m a big music guy so here So here we go here’s here’s a couple of music questions right so.
00:33:18.420 –> 00:33:30.870
Jason Mefford: So if I throw three three band names out there for you, which which one is your favorite are the groups or are you a Beatles kind of guy a stone’s kind of guy or more of a Bob dylan kind of person.
00:33:31.260 –> 00:33:33.780
Richard Chambers: It isn’t close it’s always been Beatles.
00:33:33.960 –> 00:33:35.130
Jason Mefford: it’s always been Beatles for you.
00:33:35.190 –> 00:33:36.750
Richard Chambers: Okay, I always the Beatles and.
00:33:37.080 –> 00:33:45.270
Richard Chambers: And, and more specifically Paul McCartney, I mean going back first record I ever bought I was 15 years old and and he was.
00:33:45.630 –> 00:34:02.160
Richard Chambers: It was, I think it was the single hey jude he was he was taking the lead on vocals and I thought you know, this is, this is really cool and so i’ve had the opportunity over the years to see him in concert a few times last time I saw him in concert, I was sitting third third row Center.
00:34:03.480 –> 00:34:05.130
Richard Chambers: about six or seven years ago.
00:34:05.430 –> 00:34:13.890
Richard Chambers: And it’s almost like you have that kind of see to the concert, particularly with an icon like that it’s it’s almost like if you fly business class it’s hard to go back.
00:34:15.150 –> 00:34:17.760
Jason Mefford: and had a chance to that chance to.
00:34:18.180 –> 00:34:23.430
Richard Chambers: attend his concerts a couple of times since then, but I can’t quite bring myself to do it unless i’m going to be able to.
00:34:23.910 –> 00:34:26.430
Richard Chambers: embed that particular package game with.
00:34:27.210 –> 00:34:37.920
Richard Chambers: You know, getting getting into see the sound check before the day for the concert that not all it was truly it was truly great experience for me, but Beatles Paul McCartney absolutely.
00:34:38.250 –> 00:34:46.650
Jason Mefford: Well, I mean it’s good you know, one of the reasons I asked that too is you know, for me, from a from a music revolution standpoint, we were talking about agents of change those three.
00:34:47.040 –> 00:35:03.210
Jason Mefford: Right this the Beatles the stones and Bob dylan all three of those you know groups artists had a huge huge impact on on the change of music and what was interesting as they fed off of each other to write.
00:35:03.240 –> 00:35:11.610
Jason Mefford: Right oh so dylan was inspired by the Beatles and the Beatles were inspired by dylan and you know the stones, would you know it was like this, this.
00:35:11.940 –> 00:35:13.500
Richard Chambers: thing that they were I write.
00:35:13.500 –> 00:35:22.140
Jason Mefford: Of and kind of kind of went through that so okay so that’s that’s one side of Richard that people probably didn’t know now I know Beatles in and specifically Paul because.
00:35:22.470 –> 00:35:28.560
Jason Mefford: Usually, when people say Beatles and it’s like okay who’s your favorite beatle so you gave me that second answer already so.
00:35:29.850 –> 00:35:33.840
Jason Mefford: What about you know I don’t sports sports interested.
00:35:33.870 –> 00:35:43.410
Richard Chambers: Football absolutely Anybody who knows me knows that that I live and breathe Alabama crimson tide, in fact, you can see over my.
00:35:43.740 –> 00:35:44.970
Jason Mefford: eyes, I can see over the shoulder.
00:35:44.970 –> 00:35:52.050
Richard Chambers: Okay yeah that’s I think that’s my wife and I, at the end of the 2015 national championship game when we be clemson.
00:35:53.220 –> 00:36:00.210
Richard Chambers: You know, because i’ve been them, and you know that the natural inclination when people hear that i’m an Alabama fan is all.
00:36:00.570 –> 00:36:07.830
Richard Chambers: You know he’s jumped on that train in the last 10 or 15 years i’ve been an Alabama fan since bear bryant’s era in the 1970s.
00:36:08.160 –> 00:36:12.900
Richard Chambers: i’ve been through thick and thin but i’ll tell you there’s been no mountain like the last.
00:36:13.350 –> 00:36:31.080
Richard Chambers: 12 years we’ve been able to my wife and i’ve been able to go to I think seven or eight national championship games we won six of them over the years it’s truly a great time to be an Alabama crimson tide fan and i’m very excited about the success they’ve had.
00:36:31.800 –> 00:36:39.390
Jason Mefford: Well that’s good that’s that’s another thing, and you can tell a true fan, if you stay a true fan whether they’re winning or not right so it’s like.
00:36:39.420 –> 00:36:46.680
Richard Chambers: Oh, I remember in the in the year 2000 I think we we went three games and you know you don’t give up you say i’m still with you.
00:36:47.280 –> 00:37:01.440
Richard Chambers: And, and now you know it’s just it most teams if they could have one golden era there they’re really fans are in heaven i’ve been fortunate enough to live through two real golden arrows and Alabama football.
00:37:01.770 –> 00:37:17.100
Jason Mefford: yeah well i’m a usc Grad so you know we’ve had several of those we’ve been in the slumps for the last little while but yeah the 2000s, where a great run for us and i’m looking forward to the next run when now when we’re playing Alabama gymnastics.
00:37:17.520 –> 00:37:21.120
Richard Chambers: are supposed to play last year and then the pandemic came along, but.
00:37:22.260 –> 00:37:32.190
Richard Chambers: You know my good friend kiko Harvey is the new chief audit executive over at usc and I know she she is another tried and true fan of the Trojan.
00:37:32.250 –> 00:37:34.350
Jason Mefford: fight on right okay so.
00:37:35.610 –> 00:37:42.720
Jason Mefford: So last last last of these kind of questions, then we’ll kind of wrap up with a final question, but you know, again, I mean.
00:37:43.440 –> 00:38:00.360
Jason Mefford: I learned now to I didn’t realize that you’ve moved to the coast as well right so ocean great place that East east coast of Florida is an amazing place what what kind of stuff do you enjoy doing hobby wise or other stuff outside of I mean I know you love given to the profession, but.
00:38:00.510 –> 00:38:04.620
Jason Mefford: Right, what are what are some other things, maybe that you do, that people wouldn’t know about you.
00:38:05.160 –> 00:38:14.730
Richard Chambers: Well, certainly we’re we’re and when I say we my my wife and I are partners now for more than 30 years and we love to travel I.
00:38:15.420 –> 00:38:21.210
Richard Chambers: love to to get out and see the world and meet internal auditors and meet other people from around the world.
00:38:21.870 –> 00:38:29.850
Richard Chambers: Probably my favorite place to go is Africa because I really enjoy getting there and meeting the professionals and getting to know people and.
00:38:30.180 –> 00:38:41.640
Richard Chambers: and seeing the wildlife and taking in the safari tours we’ve done that, a few times I as far as my you know, because obviously the pandemic is kind of clicked our wings, for the last.
00:38:43.380 –> 00:38:50.040
Richard Chambers: Hello we’re getting ready to to to spread our wings again and, hopefully, between now the end of the year we’re going to make a couple of international trips but.
00:38:50.550 –> 00:38:58.950
Richard Chambers: I will tell you that, being here on the beach has been truly sort of transformational for me, a lot of people say well what made you decide.
00:38:59.670 –> 00:39:08.310
Richard Chambers: to step down from the I mean 12 years I think is a long time it’s long enough, but I could have stayed longer I had longer left on my contract, but I.
00:39:08.790 –> 00:39:13.770
Richard Chambers: got out there during the early days of the pandemic and I found myself walking the beach and.
00:39:14.220 –> 00:39:20.430
Richard Chambers: Of course, there was nobody else around and really a chance to reflect and that’s when I sort of said, you know i’m.
00:39:20.820 –> 00:39:31.680
Richard Chambers: Really really enjoyed this there’s no chemical that i’ll ever reach the tire than this, but it’s time for somebody else to come and take pick the leadership reins and.
00:39:31.920 –> 00:39:44.850
Richard Chambers: For the organization to be exposed to new leadership and new ideas, so I use that opportunity to do that, but I still find myself i’ve already today, then out there and done my daily walk on the beach.
00:39:45.180 –> 00:39:54.900
Richard Chambers: it’s a great time to get out there and reflect and i’m enamored with the wildlife that we have here along the beach the pelicans and all of the other wildlife, we have.
00:39:55.350 –> 00:40:08.730
Richard Chambers: The sun rises in the morning, I see the sunset i’m on an island, so I see the sunset to the West in the evening, so this is a great way to spend the the golden years when i’m not in here doing interviews like this.
00:40:09.990 –> 00:40:20.640
Jason Mefford: that’s good no and i’m just on the other side, you know we’re in California coast, for me, where we’re a couple miles away from the beach but it’s it’s down that’s one of our favorite places for my wife.
00:40:20.670 –> 00:40:22.920
Richard Chambers: I was there last month, we were.
00:40:22.980 –> 00:40:24.750
Richard Chambers: We were there in Huntington beach.
00:40:25.710 –> 00:40:35.760
Richard Chambers: And so it was really cool to be able to stay there, and the hotel and watch the sunset yeah because I get to see it rise here so finally got a chance to to watch itself.
00:40:36.870 –> 00:40:44.580
Jason Mefford: yeah because there’s some there’s some great resource right there because we’re actually just up we’re in technically long beach, but we usually head down to seal beach, which is the next.
00:40:44.970 –> 00:40:45.990
Jason Mefford: yeah yeah.
00:40:46.110 –> 00:40:46.950
Jason Mefford: Here up from have.
00:40:47.130 –> 00:40:56.250
Richard Chambers: made the trek from Huntington beach up El Segundo and over to us, so I I feel almost like that area is now my second home.
00:40:57.810 –> 00:41:02.220
Richard Chambers: party board is based in that area, so I expect i’ll get back there more often.
00:41:02.400 –> 00:41:07.890
Jason Mefford: yeah the other two miles from my house technically so anyway yeah i’m sure you’ll be back, so let me know when you’re out here.
00:41:08.040 –> 00:41:08.880
Richard Chambers: hang on i’ll do it.
00:41:09.510 –> 00:41:16.560
Jason Mefford: Alright, so maybe just just final one question that I like to ask a lot of guests to is you know you’re 46 years into your career.
00:41:17.850 –> 00:41:18.480
Jason Mefford: If you.
00:41:18.990 –> 00:41:20.700
Richard Chambers: don’t say that to me of your guests.
00:41:20.730 –> 00:41:25.050
Jason Mefford: Now I don’t I don’t most of them are like 46 I can’t count that high, what do.
00:41:25.050 –> 00:41:25.920
Richard Chambers: You that’s right.
00:41:26.580 –> 00:41:32.730
Jason Mefford: But if you could go back right to that to that young teenager who was just getting started.
00:41:33.750 –> 00:41:44.790
Jason Mefford: And you had a piece of advice for young Richard right What would you tell to young Richard because a lot of people that are you know in their early 20s just starting the profession.
00:41:45.210 –> 00:41:51.570
Jason Mefford: Probably would be applicable advice for them as well, so what What would you tell your younger self as you were getting started again.
00:41:51.840 –> 00:41:59.520
Richard Chambers: Well, I think soak it all in you know when you’re when you’re young some time you, you find yourself, you know.
00:41:59.940 –> 00:42:09.090
Richard Chambers: In a trying to be very competitive trying to get that leg up get that extra stride in front of somebody else for the next promotion and all and you know my my.
00:42:09.660 –> 00:42:17.700
Richard Chambers: You know it’s cliche but you know, a career is a it’s a marathon it’s not a sprint you know don’t.
00:42:18.330 –> 00:42:27.060
Richard Chambers: don’t torture yourself if you don’t get the promotion you thought you were going to get or if somehow you didn’t get recognized for a project.
00:42:27.570 –> 00:42:37.080
Richard Chambers: That you thought you did a great job just step back and say you know what everything happens for a reason and and i’m going to use this as an opportunity.
00:42:37.650 –> 00:42:51.900
Richard Chambers: To get better and stronger for the future, I think I think too much, I think we we spend too much time in life and in our careers sort of stressing about things that 30 years 40 years later won’t be important at all.
00:42:53.220 –> 00:42:55.740
Jason Mefford: Well, exactly that’s a great way to actually end.
00:42:56.820 –> 00:43:05.070
Jason Mefford: and bring in a quote from my favorite beatle john which is you know, life is what happens to you when you’re busy making other plans.
00:43:06.240 –> 00:43:18.090
Jason Mefford: No that’s exactly the thing enjoy the ride soak it in and realize that it’s joy isn’t the journey, not necessarily in the destination so enjoy enjoy where you’re at so.
00:43:18.690 –> 00:43:24.420
Jason Mefford: Absolutely great advice Richard thanks for thanks for taking the time for me and for coming on today, I really appreciate it.
00:43:25.170 –> 00:43:26.940
Richard Chambers: Thank you, thanks Jason thanks for having me.
00:43:27.330 –> 00:43:27.900