Hello everyone, and welcome to The Upstream Leader Podcast. My name’s Jeremy Clopton. Excited to be with you for a very fun conversation today on legacy. This is a topic that’s top of mind for me as we’re planning for some of our events at Upstream over the next year—legacy is going to be something that we talk a lot about. So for that conversation, I have with me today, BJ Lippert, who is the managing partner of Donovan CPAs. BJ, glad to have you on the show.
Jeremy, I’m so excited to be here. I’m a big fan of the show and what an honor it is to be invited to talk to you today.
Yeah, I think it’s going to be a great conversation. We’re going to talk about legacy and what it means to step into the role of managing partner at what had always been a family-run firm. But before we do that—not a shock to anybody, you included—I am going to start off with the question that we always start with, which is: how did you become the leader that you are today?
That’s a great question. I love that you ask that, by the way—it’s one of my favorite parts of listening to each episode. Obviously, I reflected on this a little bit in preparation for our conversation, and I’m 43 years old, how do you distill it down to one thing? From my perspective, the best leader is unapologetically authentic. So the leader that I am is the person that I am. I kind of prepared my response thinking of how did I become the person that I am today? I hope that’s okay. I’m going to take that angle with it.
So the person that I am today—if you had to distill it into something that you could put into a podcast—I believe that people matter, I believe values matter, I believe systems drive predictable success, and I believe in fun. Really, virtually every decision that I make in life, including as a leader, filters through those kinds of decision criteria. If people are hurt in the process, if values are violated in the process, if it’s random and not organized around some sort of system, or if it’s not fun, it’s really not me. So how did I become the leader I am today? I mean, it’s a lifetime worth of experience, right? It’s a million different people that I’ve spoken to, a million different conversations. I’ve been blessed to be around a lot of great people, but from a values perspective and the decision-making process I go through, it’s those four things I’d say. I hope that’s okay. I went off script.
Absolutely. I love that direction. It does make me want to ask the question, though: Have you found it easy to always be authentically you and lean into that, or is that one of the things that over time you’ve realized, “I’m straying away from that, I’ve got to lean back into it,” and it’s been a work in progress to be able to be that authentic leader?
Oh no, absolutely not. It’s a skill that you’re constantly refining, and I’m still working to get better at it. Case in point, we just had our partner retreat a few weeks ago and we do an exercise called “one thing.” The one thing is: tell me something you love about me and tell me something that I need to change. We call it the hot seat. We sit in the hot seat and everyone does their one thing. But the message I kept getting over and over from my partners—they cared enough about me to say, “You need to lean into conflict more.” And the authentic part of myself sees when conflict exists, but it’s not natural for me to do it. So I’m really trying to get better about leaning into that. I know when it exists, I know when we need to get the elephant out of the room.
But no, it’s a skill you’re constantly refining, and that’s what I’m working on this year. But no, if you talk to 25-year-old BJ, absolutely not. I was trying to say the right things, trying to do the right things, trying to imitate other leaders that I respected, and only after you get some experience and you get comfortable being uncomfortable and you practice being your true self and realize that people actually respect and appreciate your true self, even if it’s different from them, even if your opinions disagree with what the person you’re talking with happen to be, people respect authenticity. So no, it has not been natural. It’s getting more natural the more I do it, and I hope I get a little bit better every year at it.
Yeah. You mentioned comfortable, being uncomfortable, and I’m going to use that as a bit of a segue. The firm that you’re the managing partner of has about a 53-year history, if I have it correct, and it is called Donovan CPAs. It was started by a Donovan, it was then transitioned to another Donovan. You are the first non-Donovan to lead that firm. What has that transition been like, taking over a firm that is steeped in phenomenal leaders within the Donovan family, and then you being asked to step into that role and be essentially the first individual not within that family to lead that firm—what has that transition been like for you?
I’ve been really warmly received as a leader and specifically as the managing partner of this firm. I joined about 10 years ago in 2015, and within a couple years of joining, Jeff Donovan, the second generation of Donovan owners, identified me and said, “We want you to be the next managing partner.” So I’ve known for the better part of a decade that this was the plan. I’m doing my best to stand on the shoulders of giants, truly. Bob Donovan, who started the firm, his son Jeff, who carried the torch for 15 years, have really set me up in large part for success. They’ve built an incredible firm with a strong foundation. The firm that I took over as a managing partner is way stronger and way better structured than the firm Bob started, and the firm Jeff took over from Bob. So Jeff—he has two kids, but neither one of them are CPAs. So there needed to be some sort of plan. It just happened to be that it was me. but I’ve been really warmly received.
Honestly, part of the reason it works so well currently, though, is Jeff Donovan’s still a big part of our team, specifically part of our leadership team. He had the title of managing partner for the past 15 years, but really was doing two different jobs: He was our firm’s visionary, and he was also our firm’s managing partner. So as a visionary, his job was to look 10 years down the road—what are the trends, what are the opportunities, what are the risks that we don’t see, how can we mitigate those? In addition to being a visionary, looking down the road, we also had him in the seat of managing partner, which is more, let’s focus on today, let’s improve this year, let’s refine and fine-tune the inner workings of our system, of our firm. It’s impossible—you’ve got two different eyes going in two different directions, one looking down the road and one looking down at the road. So Jeff is still involved as the leader of the firm now. He gets to do what he loves best, which is strictly that visionary stuff—thinking big picture, thinking down the road—which allows me to do what I do best, which is refine, fine-tune, focus on the inner workings of the firm right now. So yes, I took over for Jeff. Yes, I have the title that he abdicated, but really what we were able to do with this change is to get him in his right seat, me in my right seat.
A trend that I’m seeing across a lot of firms is, at least the firms that we work with at Upstream, there are a lot of young managing partners. That’s not a bad thing—I guess it’s not an inherently good or bad—it’s just a fact that a lot of firms seem to be transitioning leadership to perhaps a younger generation of managing partner than they had previously. One of the things, though, that I see along with that is very similar to what you’re experiencing there at Donovan, which is the predecessor managing partner is still an active partner within the firm. They are still there on a regular basis, they are not retired, but they’ve still got a handful of years, if not several years ahead of them before they look to retire.
Help me understand a little bit—how have you balanced getting Jeff in the right seat, you stepping into the role of managing partner, but ensuring that you’ve got the proper level of authority and respect while the leader that was there for the previous 15 years is still sitting right there, and it would be very easy for somebody to go to him. How have you navigated that?
That’s a really good question. I hope the other firms that are appointing younger managing partners are in the same position I am, which is they’ve got leaders who not only give up the title, but truly give up the authority, which is exactly what Jeff has done. I give him a lot of credit for his willingness to step away. We’ve had a number of conversations—not just internally, but with clients as well—when somebody still perceives Jeff as the ultimate decision maker, he’s really good about saying, “Actually, that’s not my role right now. That’s not what I do. You need to talk to BJ. He’s going to guide this conversation.” And then, obviously, he has nearly 20 years more experience than I do in the profession, so there are times when I don’t know the answer, but I’ll go behind the scenes and ask him, “Hey, how would you handle this situation?” And he lets me lead from that perspective.
So it only works when you’ve got an outgoing leader who’s willing—truly willing—to step aside and let that other person lead, not just visually, not just on the website, but truly to make decisions and guide the firm the way he or she wants to guide it. Candidly, Jeff was kind of tired of the day-to-day. If he were on this call, on this podcast with us, he would tell you himself that he did not love the managing partner responsibilities. He didn’t like the internal things, he wasn’t good at it. He got the firm to a point where what we needed was not the skillset he had. So we grew about three times in size from the day I joined until the day I took over as managing partner, and a huge component of that growth was Jeff truly being visionary. I think we completed five different mergers and acquisitions in that time period. That’s what he loved. Jeff sees an opportunity. Jeff sees some synergies. Jeff sees another firm that we could bring together. He grew the firm to a certain point to give us critical mass to be able to build some of this infrastructure, we have a solid foundation, but it got to a point where it was starting to get out of control in that we didn’t have the systems in place, we didn’t have the structure that we needed, and that stuff drains the energy out of him.
So Jeff recognized—and again, I’ll give him a lot of credit for being willing to step aside—he said, “The skills that we need to carry this firm to the next generation of Donovan CPAs” he didn’t have and didn’t want to develop. And he said, “You’ve got this. What gives you energy drains me.” So again, I truly hope every firm that’s going through this change has a leader like him that when you step away, you truly do step away and empower the next person to step up, and that’s what I’ve been given. It feels really good.
Yeah. Such an important responsibility for the outgoing leader, that sometimes we overlook it just a little bit, the importance of that, the ability to say, “Hey, I’m stepping aside, and I truly mean it. I’m not going to try to hang on to things. I’m not going to be behind the scenes almost trying to orchestrate, but truly I’m willing to step aside.” That takes such a level of self-awareness to know that you’ve gotten to that point, but it is something that, I agree with you, it’s critically important that if you’re going to do it successfully, you’ve gotta have somebody that has that self-awareness because otherwise it undermines the overall success of the person that’s stepping into that role, that successor. So, BJ, I want to—
Can I flip that question on you?
Absolutely.
Yeah? So you lead an organization that had a really significant change as well, and you stepped into a leadership role. The way I described my transition into managing partner, does that resound with kind of what your experience was when Sam and Tim—I mean, that’s a lot of experience that walked out the door and you had big shoes to fill. The way I described my transition into leadership, does that resonate with what your experience was?
It does. And much like you, when I was brought on, I knew I was brought on to be the successor to Sam. It wasn’t one of those things that, say, a year out it was, “Hey, by the way, you’re going to do this.” Instead, it was, “Hey, you’re coming in. We’re going to do everything that we can to prepare you for that.” Some of that was knowledge, some of that was learning, some of that was application of the knowledge and learning. But as you said, it was arguably both Sam and Tim’s willingness to step out of the leadership that allowed me to most effectively step into it, and that is both internal within our team, but also with clients.
One of the things that I would say that Sam did probably better than most is he essentially gave me his credibility during the transition process. He would be the first person to say, “Jeremy’s going to be stepping into this role.” He always called it, “This is my expiration date. Jeremy will be stepping in at that time, but Jeremy’s got new ideas and fresh perspectives that I’m never going to have. You’re in better hands than you were before.” Now, do I fully believe that he thought better? Knowing Sam, perhaps. He knew that, much like you said, I had a different skillset than he did, and though we may have similarities, we may have similar principles, we have similar values and core beliefs, we approach things with a slightly different kind of perspective. So it wasn’t necessarily that one was better or not, it was that one was fresher perhaps than the other, which is something we talk a lot about with firms. There comes a time you need a fresh perspective on leadership because you can’t see the things that that new perspective brings if you’ve just been doing it over and over and over again, which we sometimes fall into the trap of.
So I would say yes, your transition is very similar to the transition that I experienced, and it was the self-awareness of the outgoing leader. I would say also the confidence of the outgoing leader, that their success, their value, their worth was not tied to their identity as a leader, but it was just as important that they transitioned to the next person so that they could see that as success.
That’s so good. Yeah. It takes intentionality and it takes humility. And I think you hit the nail on the head too, which is Sam and Jeff had the same perspective in that, “Yes, BJ’s taking over, yes, Jeremy’s taking over, but they’re not me. So don’t expect Jeremy to lead the same way Sam does. Don’t expect BJ to lead the same way Jeff does, but I trust him. I trust him to make these decisions, even though that might not be the exact same way I would handle it. You’re in good hands.” So much of it—so much of your success, my success, and the success of other transitioning managing partners depends upon a willingness by that outgoing leadership to say, “You’ve got this, I trust you, and I empower you.” So cool. Thank you for sharing that.
It really does. It really does. Yeah, and thank you for the question. I want to ask—so when I was preparing for that transition period, I was, I don’t know, I was two or three years out, and I was talking to a gentleman that’s an executive coach, keynote speaker, author, CEO of a company, Jake Thompson, who’s been on our podcast a couple times. We were talking about it. He said, “Jeremy, one of the things you’ve gotta remember is you are not trying to be Sam and be his legacy—instead, you are trying to build your own legacy on the foundation that is his.” So take his legacy and then build upon it, don’t just try to mimic it. That was such an impactful statement for me. So I’m curious for you, BJ, you mentioned standing on the shoulders of giants and those that came before you. You’ve got a 50-year history that came before you, you are stepping into this role. How are you shaping the legacy that you want to build for Donovan, whether it’s building on the foundation of the past, but also then bridging that to what you see as ideal future?
Oh, goodness. Candidly, I don’t think—granted, I’m eight months in this role, so maybe my opinion will change in a couple years—but I don’t think about legacy, not yet. I think about trying to do the right thing over and over and over again, consistently, predictably, and my hope is that over time, that amounts to something that is valuable to people that were touched by the work that I’m doing. What my legacy is, what my legacy will become, I don’t know. I hope when people go back and look at my career and think about things I was able to accomplish, my sincere hope is that they’ll look back on those four things I mentioned at the beginning, that people matter and values matter and systems are important and fun is important. I hope people can look back at the way I led and what the firm has become and say, “Oh yeah, his character, his lifeblood that he gave to this firm became what we develop into.”
Legacy? I don’t know. I’m a Colts fan. I live in Indianapolis and Peyton Manning has an 18-foot-tall bronze statue in front of Lucas Oil Stadium. I don’t envision that. I don’t plan on changing the name on the sign on the front of our building. My hope is that the legacy that I build is in the people that we impact, and the team members who join our firm, and the clients who love us and refer work to us, and the people who get peace of mind with the work that we do—that’s legacy for me. Nothing means more to me, Jeremy, professionally, than when somebody comes up to me weeks or months or years after an event and says, “I don’t know if you remember this, but you did this, or you helped me in this way, or you said this thing that inspired me to change, or you held me accountable for something, and that was the point that I changed, or that was the point that I believed in myself.” We talk about legacy? That stuff gives me chills. So what the firm’s worth—great. Sure, let’s build a valuable firm. How many clients we serve—great. Let’s serve a whole lot of clients. But lives positively impacted—I don’t know if you follow me on LinkedIn or if anybody listening does.
I do.
We recently revised our 10-year goal as a firm. We’re two years into our 10-year goals. We’ve got eight years to get there. We set a revenue target and every year we’d come into our strategic planning retreat and we’d talk about how close we’re getting to our revenue target, and it just felt wrong. We’re a people-first firm, our mission is all about our internal team members first. We’re like, “Why is our number one target a dollar sign, and our mission is about people?” So we totally rewrote or revised our 10-year goal, and instead of a revenue target, we want to positively impact a thousand lives. Each life is defined as a team member, a spouse, dependents living under the same roof—so kids, adult parents, whatever it might be. Every team member that we add, every spouse that marries into the Donovan family, every child that’s born to a Donovan team member, adds one more person to our goal. And obviously inherent in that, you have to grow, you have to drive revenue, you have to get bigger and take on new clients, but it’s about positively impacting the lives of people around. It gets a whole lot easier when you care deeply and it gets a whole lot easier when you touch lives with some sort of meaningfulness. So legacy—I don’t know. I don’t know if, if you interview a thousand people…
It’s a tough word, isn’t it?
Yeah. It’s a tough one to nail down, but it feels right. It feels like we’re building something special.
How are you balancing the business side with the purpose first approach? So switching it to where your focus is now impacting a thousand lives. I could share from Headwaters—you spoke on a panel—and I had numerous people remark to me how well articulated your thoughts were and just how impactful they were. So arguably you could say you already got a hundred of them there because there were a hundred people listening, and I’m sitting here thinking, knowing you, knowing Jeff, knowing the people that are at your firm, impacting a thousand lives, I can’t imagine a scenario it takes you all 10 years for that—my guess is it probably takes you 10 months, maybe less, just because of the people that you are.
I love the approach, though. So help me reconcile, if you will, because I know that there’s somebody out there thinking, “Okay, great, people, people, here we go again. We run a business.” So as the leader of the business and the leader of the organization impacting the people, how do you reconcile the two and not lose sight of the fact that you do have to be, at the end of the day, profitable in order to impact more lives?
Well, let’s see, let’s make a business case for it: Fewer and fewer students are attending four-year colleges. Fewer of those students are becoming accountants. Of those accountants who graduate, fewer of them are becoming CPAs. So as if the talent market weren’t tough enough already, now you add all those factors in where there’s a diminishing supply of talent, people who want to be CPAs, even those CPAs who want to devote their careers to the profession. So I look at it, not only is it the right thing to do—when you can align the right thing to do with the smart business move, you’ve got a winning combination. I know it’s the right thing to do.
The other side of this is the right business move. The longer we can attract, develop, and retain talented employees, the stronger our firm is going to be. So higher retention rates of our team members means better retention rates for our clients, which means less brain drain when we have to bring in a new team member, which means quicker turnaround of products when you’ve got multiple years of experience of working on the same client, you know them inside and out. Clients are stickier, team members are stickier, revenue’s more consistent, recruiting gets a heck of a lot easier too, because as you recruit people and then their friends start going through the recruiting process—maybe they’re a year younger—they say, “You might not have heard of Donovan CPAs, but you need to check these guys out.” Recruiting has gotten so much easier, Jeremy. We are to the point where we’re turning away intern candidates. Five years ago, we were begging anyone with a heartbeat and who knows that a debit equals a credit, we’ll take you. It’s not that way anymore. We have such an incredible team here that we’re actively, “How do we get this thing to grow, to provide opportunities enough for everybody?” So what’s the business case? It’s exactly that. Focusing on your people is focusing on the business. One of the rock stars in our profession that I always look to—my team gets tired of hearing me talk about it—but John Sensiba…
I knew exactly where you were headed.
The guy has a way of taking these incredibly complex, big, meaningful decisions in our profession, and just boiling them down to their absolute basic elements, and making it sound so simple. He presented at Headwaters and essentially said, “I don’t focus on revenue, I don’t focus on profitability. We focus on employee experience and customer experience. If you do those two things, you will win. Financially, you will win. You will run a successful, profitable business.” Goodness, you can paint a really ugly picture of the opposite side of this, where you don’t focus on your people and you’ve got constant turnover and your clients are upset because they have to retrain the team every single year, now they’re leaving, and just—my goodness, again, if you can marry the right thing to do with the smart thing to do, which I think is what we’ve done here, success is inevitable.
I absolutely love it. You don’t have to make the business case for me because we agree wholeheartedly on that. You know, John Sensiba as you mentioned, his three rules: if you can be kind—or what is it—communicate, meet your commitments, and be kind. If you can do all three of those things—if. It reminds me always of Mike Krzyzewski, and he had a talk that was recorded online, back before it was online, so I’m sure it was recorded in some other medium, probably. But it was the idea of having standards versus rules. And if you have standards, you don’t have to have rules that police it because everybody wants to adhere to the standard. And that’s the—like you said, the approach John takes. Here are the standards: we’re going to communicate, we’re going to meet our commitments, we’re going to be kind. Your standards are people. Let’s have a positive impact on people, do the right thing for our people, for the people that we work for, the people that we work with. You’re going to have that standard. You don’t have to have all the policies and the rules that enforce the right behaviors because you’ve got the right people that understand the right standards. So I love what you’re doing there, BJ.
I’ve got two new questions that I’m going to end the episode with, and you’ve already—we talked about legacy, so one of them you’ve already touched on, which is: what is the impact that you want to have? And you’ve talked about that through your four values. And the other question that I’m very intrigued—I asked at the start of the episode, how’d you become the leader that you are. My question, though, that I want to end the episode with is this: who is it that you’re trying to become? Over the balance of your career, over the balance of your life as a leader in business and outside the office as well, who is it that you’re working every day to become?
Oh my goodness. I probably would’ve spent more time preparing for this question if I’d known it was coming versus the first one. That’s a great question. I’m going to give you two names, I’m going to give you two people. The first one is—sports fans may know the name—Brad Stevens. He’s the former head coach of the Butler men’s basketball team, also former head coach of the Boston Celtics, he’s now the Celtics GM. But that man does exactly what I’m talking about. He lives and leads according to values, and he doesn’t compromise on those. Sometimes you win as a team under those values and sometimes you lose as a team under those values, but you always adhere to them and you can win and lose with your head held high. Man, I’d walk across hot coals for that guy. The few chances I’ve had to listen to him speak—he does it the right way. He does all the things that I’m talking about as far as positively impacting people and leading with values.
The other thing that I’ll say—I went through a really cool training when I was in college and my fraternity, we did a leadership training course and they had us do something similar, which was to basically create a personal mantra, kind of a personal mission statement. And 20-year-old BJ at the time wrote something down that has really stuck with me and I do try to do this, try to be this every day. What I wrote at the time—I obviously wasn’t married, didn’t have kids at the time—but I wrote that I would try every day to be the man that I would want my own son to grow up and become. And when I think about how I live life, and how I walk through this world, I try to put things through that filter of I do have a son now, he’s a 13-year-old kid. He is incredible. If he was watching me do this, is that something that I would want him to emulate?
I love it.
So if you want a name that people know, Brad Stevens is a great one. If you want something a little bit more heartfelt and the core of who I am, it’s trying to look through the lens of who my son’s going to grow up and become. And hopefully I can be that role model for him. Hopefully that answers your question. That was a fun question.
Absolutely. I love the reference both to a known name and also the more heartfelt, the core. As you know, I’m keenly interested in the stories of people and the stories in our profession, which is one of my favorite things about the podcast. So the core side of it intrigues me even more, and I love what you shared there and how you lay that out. For those of you that are listening that don’t know BJ, I would highly encourage you to connect with him on LinkedIn. He shares some amazing things there. He is an absolute joy to be around. Always a smile on his face. Just a great person. And also someone that—he may be located in Indiana and you may not yet have heard of Donovan CPAs, but I can guarantee you BJ is going to be doing amazing things as a managing partner and is someone to keep an eye on in the profession over the balance of his career. BJ, thank you so much for joining me on The Upstream Leader. I’ve really enjoyed the conversation.
Ah, this was a blast. Can I do it again sometime?
Absolutely. We’ll have you back.
Let’s do it. Thank you, Jeremy.
