MEL #053 | From Independent Contractor to Company Builder through Clarity, Trust, and a Willingness to Act with Cathy Toth

TOTH (00:00)

My favorite working definition of leadership is a willingness to act. And while that sounds simple,

You never have enough information to feel fully confident in a decision that you need to make. Being willing to act means you have to get uncomfortable with some level of uncertainty and some level of risk.

ADAMS (00:43)

In this episode, I speak with Cathy Toth, founder, president, and CEO of Acato Information Management, a software quality assurance company located in Oak Ridge, Tennessee. Cathy grew up in a family of engineers. She started in biomechanical engineering and ultimately finished an electrical engineering degree for practicality and momentum towards graduation.

She quickly moved into software and later negotiated flexible work through independent contracting so she could be home with her kids. And she eventually built a career specializing in software quality and

In our leadership segment, Cathy gave us two examples focused on scaling Acato First, she talks about her approach to shifting a large project team from delivering every eight weeks to delivering every two weeks. And later, she discusses how she is redesigning Acato’s organizational structure so it’s not a company that’s just Cathy and everybody else. Both challenges required clarity, operational redesign, and the courage to make decisions with incomplete information. 

In our advice segment, Cathy emphasizes taking your leadership development seriously, acting with imperfect information, and telling the truth in ways that support good decisions. She also highlights relationships as a pathway to results, including building networks through service and nonprofit leadership. Across it all, know what matters to you, do the homework, and be willing to step forward before you feel fully ready.

Explore the full episode summary, including guest bio, key takeaways, transcript, and recommended resources in the show notes at drangeliqueadams.com/podcast. Without further delay, here’s my conversation with Cathy Toth.

ADAMS (02:29)

Hi, Cathy welcome to Mastering Engineering Leadership.

TOTH (02:32)

Hi Angelique, I have been looking forward to this so much. Thank you for inviting me.

ADAMS (02:36)

Thank you for joining me. And I too have really been looking forward to this. Can you start by telling us how you got into engineering as a career path?

TOTH (02:43)

Yeah, that’s such a funny question to me because the truth is, I think it’s a genetic flaw. and it’s not where I thought that I was going. When the University of Tennessee opened its vet school and welcomed the first class in 1976, I was absolutely sure my 11 year old self was absolutely sure that they built that for me. And when I got to college and I filled out my forms and I looked at them afterwards, it didn’t say pre-vet, it said engineering. And what you have to understand is that

my dad is a PhD in electrical engineering. He wrote the textbook we use in our electronics class. My mom has a master’s in electrical engineering. Big brother has a PhD. Younger brother is the black sheep. He has a master’s degree in mechanical engineering. We left him in the family because he married electrical engineer who went on to get her PhD. my dad has a brother with five sons. His brother was a mechanical engineer, four mechanical engineers.

one electrical engineer. So it is a little bit of that’s what I knew. And I also understood that it was pretty practical and workable. But my dad was such a cheerleader, Angelique, he was such a cheerleader about how great an engineering degree could be for your life. And if you were anywhere from a freshman in high to a sophomore in college, and you got in his orbit, his convert rate was incredible.

So in some ways it was a path of least resistance to me from that perspective. But I also really did understand that it was a very workable, very practical degree. And I could understand how it fit into the bigger picture.

ADAMS (04:14)

That’s amazing. So can you talk a little bit about your educational journey?

TOTH (04:18)

Yeah, did. You know, I’m not going to kid anybody if you’re if you’re talking to engineering students, they don’t need to know this. They don’t need to hear this. engineering is hard. It’s not an easy set of courses to get through. But it does really teach you how to think. And that’s one of things I really valued about that. So I started in actually biomechanical engineering.

thinking that I would blend my love of life sciences with engineering. But at that point in time, the marketability of a biomedical degree was just not what it was for electrical engineering. I got to my junior year in electrical engineering and I went home and I cried all over my daddy. And I said, I don’t like this, I don’t want to do this.

I really want to go and get a PhD in genetic research because that’s what I love. And my dad said, okay, figure out what that means for you and graduating. And I was engaged and about to get married. And so when I did that homework, I realized that if I was going to change schools and change majors, I was starting over again as a freshman. So I decided that really

fastest way to graduation was my career, my pathway, not changing degrees. I’m actually really glad that it worked out that way. my undergraduate degree provided a really solid platform for me to do a lot of things. I did work as an electrical engineer. I went to software really quickly instead of hardware right out of college. And I really loved that a lot. It was solving real problems for real people. And that was a lot of fun.

But it also, gave me like a really good way to do other things, you know? So I, it opened doors in a way. one of the, I worked as an independent contractor for a while. So I graduated, I had my first job. It was in an aerospace with General Dynamics in Texas. And that’s where I was doing some software development. And then when we moved back to Tennessee, we started a family and

I was really important to me to be mommy. I wanted to be home with the kids. And so what I was able to do is work part time on my own terms. And the story of how that worked out is kind of funny. I went to my boss and I said, his name was Charlie. He said, Hey, Charlie, I have a deal for you. Cause he knew I was pregnant at this point. said, I will work half time, half salary, no benefits. I’ll guarantee you one day a week on site.

and the rest of my time I want to work from a home office. That was 1991. And he thought it was a pretty good idea. But he went, he said, I have to ask my boss. And so he asked his boss and his boss thought it was a okay idea. But he had to ask his boss. I don’t know how far up the chain they actually went, but when the answer came back down, it was, we can’t possibly do that. They will say we pay people who don’t even come to work.

post COVID, that’s hilarious. But in 1991, was the standard. So I quit. And he called me up a few months later and said, hey, are you sick of this baby stuff yet? And I said, no, I’m having more fun than I’ve in my entire life.

ADAMS (07:13)

You

TOTH (07:14)

And he said, I was kind of afraid of that. How would you like to do some contracting? so I went back doing independent contracting pretty much with the same thing that I proposed, except that I got paid more than I would have gotten paid at half my young engineer salary. So I did that for years and years. And I was able to be home with my three kids while I was raising them. I worked as much as I wanted to.

It contributed to the family finances, but we made decisions outside of my work to make sure that our finances were okay. So it’s kind of like, how do all these big pieces fit for your whole life, not just your career path? So I don’t know that gets to your question, but that’s how I was thinking about it.

ADAMS (07:52)

something that I’d like to double click on if you’re you know if you’re open to it is I just really appreciate this idea of You really thought about what you wanted and you were willing to propose

creative solutions and keep going after these creative solutions so that you could have the life that you wanted path. And I think that more young people in particular need to understand that that’s often what you need to do. That this clear career trajectory with

know, progression after progression after progression through this linear pathway is not necessarily what life is going to look like, particularly when you want to take into account factors of what your spouse and family and other stakeholders that you care about, what works for them too. So can you just talk a little bit about how you went about that conversation you’re maybe having with yourself and with your partner about

Yeah, this isn’t like a full time job that is on this career path, but this is what’s going to work for us.

TOTH (08:59)

Yeah, I knew things that were important to me. And I think it’s really important that everybody does their own homework and says, what are the things that really matter to me? I can say, looking backwards, that most of my decisions were based on the things that I thought were the most important to me and to my family and everything else you could kind of move around. I’ll also say that was not the first time where if I came up with a solution that

it ultimately worked out to be pretty close to that solution. So I got married after my junior year in college and transferred to a different school. Tennessee was on the quarter system. Texas was on the semester system. So I did the homework of going through both catalogs and mapping my courses and I took it to them. And the only exceptions that they made is I only had one quarter of modern physics. They wanted a whole semester. So I had to take that semester over and Tennessee did not require a

PE credit to graduate, which was funny because I was, I was running about 10 miles a day and lifting weights. it was pretty close to what I actually proposed to them. And so I found that over and over again, if you can, if you can make a workable path that accounts for the things that you’re, whoever you’re pitching it to care about and satisfies those needs, there’s a lot of freedom out there.

of what you can accomplish. And if you’re willing to do the work to back it up, then people will let you try stuff. It’s not. So when I went to my boss, Charlie, he came back and said pretty much what you said, except now it’s independent contracting. So benefits and things like that are not a question. But that worked out. And people are open to those kind of ideas. But you do have to do the work. And you do have to know what matters to you. And you do have to remember that

Other people have their own set of concerns and you need to be willing to hear and address those concerns.

ADAMS (10:46)

Yeah, I think that’s really important, you know, do the homework and recognize that Just as you said other people have their own concerns You need to be flexible to meet them where they are as best you can and this is really a negotiation and if you think of it that way you you very often can can get to a solution that is Directionally correct if not really

almost exactly what you were asking for in the beginning, which I think is great and really important for people to understand.

TOTH (11:12)

emphasize one other thing. It’s like most of the time I heard the question, what do you want to do when you grow up kind of questions as what job do you want to have? And I think that’s a misleading question that you need to think about your whole life and what matters in that life. You you’ve got family, if you’ve got other passions that you care about, if you’ve got, you know, your work is part of that. Engineering is a great platform to

be able to find good work, even if the point of that is to support the things that you really want to do. But you’ve got to understand what that relationship is within yourself. And I know this is not the same story for every young woman, but for me, being able to be home with my babies was really important. And so that was one of those kind of like, can’t negotiate that away and make decisions based on what is highest priority to you. And then, you know, my

Some of my early contracts were really like, just made some money, I did some stuff. Was I on a great career trajectory at that point? Nobody knew. Looking back, I can say I learned valuable lessons in some of what I did, and I got exposure to things that I probably wouldn’t have otherwise. But when you’re doing that, as you’re going through that, it doesn’t necessarily look like it, because you can’t connect the dots yet.

ADAMS (12:23)

And so talk a little bit about what you did after you did the independent contracting and kind of take us through what you’re up to now.

TOTH (12:30)

Okay, yeah, so I went, I was still doing some independent contracting, but the real pivotal moment was we moved from Tennessee to Virginia because my husband’s job took him up to DOE headquarters for a two-year assignment. So I let my contracts in Tennessee go and focused on getting my kids for now just early elementary school and was hanging out at the bus stop because my daughter was in kindergarten and that’s what you do if you’ve got a kindergartener, you have to be at the bus stop and

We’re the new family in town, started having conversations with a dad that was also with his kindergarten daughter. And the moment I said I had an electrical engineering degree, the conversation shifted. He said, I am, he was a founder of a software company that was in California. And he said, we’re looking for somebody to do some testing on our software before we send it out to our customers because we’ve had a few embarrassing moments.

by sending it out without being tested. And I said, well, I can do that. And it’s like, you know, 10 hours a week, whatever, fit my schedule. So I started doing that. That California company was very influential to me because of how they worked. It was truly a no blame culture. Nobody knew that term at that point in time, but things would go badly. And if any of your students are involved in software development or probably any project, you know, things just don’t always go the way that they were planned.

We would all get in the room or on a call and somebody would go, my fault, my bad. And everybody else would go, nobody cares. I’m going to do this. So-and-so is going to work on that. Do you need help with this? And here’s the plan. And we would just leave the room with the plan to get back on track. That was really powerful to me. The other one was the ability of this small startup company culture to decide and execute at the same time. So it had that people side of it where people were taking care of their own lives. The other thing is like people would come and work.

and they worked really hard, but their schedule was a little bit nonstandard sometimes. So the two founders would leave randomly, like at 11 o’clock on Thursday, to go take their toddler boys to swim lessons. And then they would be back. They might be working at 11 o’clock that night to finish everything, but there was this kind of fluid conversation between how work and life and things fit together. And so those things were really influential. Ultimately, that company went out of business. We were back in Tennessee.

But I had another opportunity to do software quality and testing, which I had learned I really, really liked. And so I started doing that also as an independent contractor. And that team just grew and grew and grew until I got to a point where I had so much more work than I could do that I had to make a decision about, I take this work to an existing company and say, I have work for right now five people, probably growing to 10

And the only string is I have to be one of them. You know, or do I start my own company? And it was the reason I told you about that California company is that’s the thing that haunted me is could you have a company that was as good for the work that you do as the people doing the work as it is for the work that you do. And my husband was in different roles, not always super happy with how things were at the bigger institutions. and

What I was understanding through some of my own reading and other work is that we spend a good chunk of our lives at work. You don’t want that to be miserable. And I also think that there’s a tremendous opportunity for workplaces to allow you to really develop and grow as people, as human beings, and minimize the suffering of that, that work itself can be nurturing, the workplace itself can be nurturing and even therapeutic as you

make your way in the world and interact with other people. And so that was my, that was my mantra was like, could you create a place that was as good for the people doing the work as it is for the work that we do. And that my work for the, you know, the quality of work, I’m kind of a perfectionist. That was a pretty high bar, which meant being good for people also had to be a pretty high bar if those two things were going to be equal. so that’s, that’s how that kind of rolled into the rest of my, my story of where I am now. I chose to launch a company. It’s a, it’s a Cato.

We are now 15 years old, so we can get our learner’s permit. We’re at 32 people.

ADAMS (16:26)

That’s amazing. And I love how this early inspiration of like what’s possible in terms of what work can be like, what a company can be like has really inspired you. And can you talk a little bit about what are some of the key elements that you have found to be important to allow Acato to have the good work and good for the people that work there together?

TOTH (16:46)

Yeah, I can. think holding that idea, really holding onto it, my mind works kind of operationally. So if you give me like really cute catchphrases, I’m going to immediately go into how does that actually work, right? So being good for people, a job, I think there are three vectors that need to align for a job to be a good job. It needs to satisfy the person.

It needs to satisfy what their needs are. And that can be different from every person. It could be around what their purpose is. It could be around their family stability and security. It could be about how meaningful the work itself is to them. There are a lot of things that could fit into that. But it needs to be good for the person that’s doing the work. It needs to be good for the work itself. And that means you’ve got to be good at what you’re doing. You have to have the skills and the competency and the work ethic to be able to work in the.

and the relationship skills to be able to work in teams and with other people. And then the third is has to actually be good for the business itself. And that would take me a little while to really understand. But the way I would say it now is it has to be good for the business as in the future of the business. So the analogy really is like the business is kind of the goose that’s laying the golden eggs, right? You have to take care of the goose too. So if you think about those three.

things as vectors, then creating the conditions for work to be meaningful as meaningful as possible, helping people understand that what you did has a bigger impact in the world. So we work on software applications for the National Nuclear Security Administration, NNSA, and the tools that we build allow them to accomplish missions related to national security.

reduction of nuclear nonproliferation, all of the NNSA emissions. We also work on applications where they are using real-time data to understand the impact of natural disasters and where help is needed. So what you might do at your desk every day may not seem like a big deal if you’re sitting here running through test cases or designing that.

But if you have to step, if you can help people see the connection to the work you did, helped somebody get power back when they were after a natural disaster. You know, those are the kind of connections I think that you can help make. The fundamentals of, you know, a good enough pay, the right resources to have the tools that you need, being willing to invest in people’s growth and development, particularly in technology where it’s changing quickly and you need upskilling is hard.

That’s another word that gets thrown around pretty, we’ll just upscale. We’ll just train them. It’s actually hard and it’s hard for them. So how can you help with that? So those are some things around being good for people. That crossover to being good for our work is making sure that we keep our skills up to date and we’re investing in that professional development. And then I’m going to say helping people understand that businesses have needs, the business itself has needs.

And that’s not being greedy. That’s not what that is. It is, we need to retain enough earnings that we have a rainy day fund. we spend a fair amount of time trying to educate people. Here’s how we make money. Here’s where we spend money. Here’s how we make those decisions. I can’t tell you how much people really care about that, honestly. mean, there’s some that do, but trying to help them understand. I hear sometimes with…

even my own kids talking about their jobs and the phrase evil corporate. I’m like, wait a minute. I don’t know any business founder or really business leaders personally that are out there to take advantage of people. But there are things that you have to take care of in order to be able to say, I’m never going to bounce your paycheck. I guarantee you I will not bounce your paycheck.

I guarantee you that you will have the tools you need. My job is to make sure you have continuing work, know, but there are needs. Some of those things cost money. And that’s not an owner being greedy. is you’ve got to feed the goose. You got to take care of that goose too, if you want to keep going into the future.

ADAMS (20:49)

Cathy, can you give us an example of how you use leadership skills in your work?

TOTH (20:53)

I sure can. I’m going to start with a project team that had a goal that they set for themselves. And so one thing you’ll have to understand about how we work is typically we are embedded in project teams. So we will have one or two people embedded in a software development team with a focus on software quality and testing. So that might be a 10 per 8 person team, 7 to 10 person team.

And then on this big project, have like 10 teams that we’re a part of as kind of as the whole. So that whole team wanted to deliver software releases more frequently to our customers. And we had been rocking along for a number of years where we had a particular kind of cadence where we had four development weeks when two sprints and then a testing sprint or hardening sprint where we really went through and did a lot of testing.

And that was working fine, except that we were delivering software every eight weeks and we wanted to deliver every two weeks. Okay. Not, not more, not eight weeks worth of work in two weeks, but just more frequently getting the value out to the customers. Well, as it turns out, that really changes the mental model of how you have to approach what are, what the whole team’s work is. Took us a little bit of time to really understand the full impact where

We were focused on the full scope of a capability, a feature, and getting that done. Whereas if you’re delivering frequently, you’re delivering smaller slices of that. It also meant that we didn’t have for our work that two-week block where we knew we could go in and do a lot of stuff. We had to figure out how to slice that differently. And as we talked about it as a project team, we came up with all kinds of wild ideas. And I kept trying to draw pictures of them in my mind.

And I couldn’t, like, these just don’t make sense. You know, how do you put these ideas into time and space? And so I drew a picture. I drew a picture of each of the options that we had talked about. And then you could put them up on the wall and you could point to them and say, okay, if we do that, it looks like this. And I mean, this was not a fancy picture. Pictures don’t have to be good. These were in Excel. So I had a calendar laid out in Excel and I’m like, here’s a list of things that have to get done and here’s where they fit.

And when you look at looked at the, there were really two competing ideas. When you looked at one of them, you looked at it and you’re like, well, that’s a mess. You know, if I’m a person on a team and I’m coming in to do my work on Tuesday, I don’t know what to do. I don’t even know which environment to log into. And I don’t know how to know what the state of that environment and what’s been delivered that because the complexity was just the branching and the merging and all of that was just so much more, so complex. And, and it didn’t give.

my part of the team, you the software quality and testing, the opportunity in time and space to do the work we needed to do. So I do, the alternate picture was simpler. It had some other challenges, but they were more workable. And it was much more clear to be able to say, on Monday we do this, it required a shift in the way the team thought that our work was not just our work. If we were going to do regression testing, everybody on the team was going to help with regression testing.

which I thought was a good thing for everybody’s mindset that, you know, when you’re delivering, we deliver as a team, you got to be part of that whole process. So the power behind that was really the picture and being able to draw a picture. And again, they don’t have to be good. That Excel picture, my artwork in Excel is still in the project plan today. I’m sure somebody could draw it better.

But that was just good enough. It was good enough to get the idea and explain what we were trying to do. I felt in doing that, there’s a level of vulnerability. If you’re the one that draws the picture and puts it up on the wall, it’s the first draft. If you think about that, there’s a fear of like, what if I didn’t get it right? And I think the frame you have to put on that is

I’m not really here to get it right. To be right about it, I’m here to help get it right. And when you put that first draft, you did the heavy lift for everybody else to look at it and make it better. But that first draft is hard and it feels really vulnerable when it’s your idea and you put it up, it feels like you just put a target on your back. reminding, you know, I did have to remind myself like that’s to help us get better. That doesn’t have to be the final answer. And it’s interesting to watch people’s reaction that

How do you encourage them to actually give you honest feedback sometimes is not easy, particularly I was in a leadership role on the project and you have to tell them explicitly, I’m not married to this. I need you to make it better, right? This is a first draft. You make it better because otherwise some people, times people will just not want to say what they really think. And just because it crossed the mind of Cathy does not make it a good idea.

ADAMS (25:35)

love this example because a couple of things come to mind. So first of all, you know, it really brings the power of clarity. So you have all these people, they all have ideas in their mind. I could envision, I don’t know if you were all in the same room, but I can envision like people talking over each other and, you know, just this sort of chaos that happens in the brainstorming mode. And then to be able to say, okay,

I let’s try to get some real clarity about what we’re talking here and actually visualize the options. So now everybody’s going from inside their own head to now looking at something in front of them and you can all kind of make sense of it together and forward from there. So I, I think that’s really an underestimated leadership move is to simply offer a picture as you call it, of what everybody’s talking about. And it gets people out of this.

brainstorming mode. But you’re right, it is vulnerable. it takes a willingness to throw something out there and have people take stabs at it. And I think that that’s also really important to have the right mindset of, okay, this was my first idea, or this is not even made out of even being your idea. Like, this is what I think I heard in the room, right? I just want to start there.

And then, you know, let it move on from there. The other thing that comes to mind, and I want to maybe explore this a little bit more, when you are a senior leader and you put something forward, the weight of the role comes with that and can often close down feedback. And so you’ve talked about one way you do that is you explicitly say, like, this is a draft. I want your feedback. I want you to revise it.

A tactic that I like to use is a whiteboard. So I will often whiteboard it out and then take a picture of that. And it’s like, clearly this is a draft because I haven’t used any modern tools at all to turn this into something. But can you talk a little bit more about this idea of, as a senior leader, inviting feedback, inviting criticism, and how you go about that?

TOTH (27:27)

Sure, I believe that results follow relationships. so even though I did put the draft up in front of the whole team, before I did that, I sat down with the key influential people on the teams, whether that was by role or by, everybody knows when a hard question gets asked, who do we look at? I wanted to go talk to those people and say, you clearly have the big picture here.

I also knew the people, because I started on this project from its very beginning when it was a seven person team. We’re now up to nearly a hundred. So when I knew those people and many of them are still there. So I knew who had really held the best interest of the program very dearly. And so I talked to them. So that’s technique I use a lot is if I’m trying to develop an idea, go and make sure I have.

the input from the people that I think will provide the most valuable input, and also from the people who I need on board for something. Then it’s less of my idea. Even in presenting it, I can give nods to people who have already made improvements to it, and so then it becomes less of just my idea and more of a consensus and buy-in.

ADAMS (28:35)

And how do you handle potentially conflicting feedback or input on the idea? How do you think through, I picked these valuable people to give me input and they either maybe don’t like my idea or they have completely clashing views. Do you have a strategy for how you kind of think through ultimately what ends up in maybe your first draft?

TOTH (28:56)

Yeah, I think for this particular example, because it was a very operational and workflow that if somebody who was in a particular role, let’s say you were in charge of reviewing new code that needed to be merged back in, that was done and tested, needed to be merged back in, if that was your job, then I took your input the most heavily. It’s going to make my life miserable and really slow everything down if I have to do that, or it didn’t account for something.

That’s one way to think about it. But in a lot, most, most of the time when it’s been operational like that and you have all of the perspectives in the room, people are willing to give and take, you know, even though it’s easier for me to do this, I see why it causes a problem for you. And they’re willing to find another way to work that out. on other things, if it’s really, you know, like as, as CEO, if I think something is the most important, I have to get really comfortable in my gut.

about have I really all of my decisions go back to that our purpose statement? Is it good for the people? Is it good for the work? Is it good for our future? And they don’t always give you the same answer. I don’t I laugh about this now because I feel like I’m always working max men problems. And when I was in school, I hated max men. It’s just the only thing I’m doing. So thinking about, you know, what do I really want to optimize here? What are the pitfalls? What are the risks?

TOTH (30:12)

You never have all the information. You don’t know how it’s going to work out. But if you can be get to a place where you know why you made the decisions and you understand as best you can what you think the risks and the downsides are, you ultimately sometimes just have to say, I’m making the decision. And then sometimes I have to say things like, I believe this is in the best interest of the company. I believe this is in the best interest of the project. And I guess the third technique I would use is ask a lot of questions, you know, and maybe

My style is different than maybe other people, but I have found as a woman of my era, certainly, and maybe this has changed a little bit, that coming in with that really my way or the highway attitude is not very effective. But if I can ask you questions until you come to my conclusion, then that’s a much more palatable way to sustain the relationships that you’re going to need on down the road for results.

ADAMS (31:02)

And Cathy, we are lucky you have another example that you wanted to share with us.

TOTH (31:07)

Yes, I do. So I told a little bit about the story of where Acato came from. And so I started out as the individual contributor, eventually grew the team. And as over time, my role needed to change. Because as you move into more leadership roles, part of what you need to do is work through people and not do all the work yourself. About two years ago, I realized that the way Acato was structured was there was Cathy.

and then everybody else, right? We were really, really flat. And I knew that it was really important for me to be able to have a leadership team that I could depend on. don’t scale, and I was sort of hitting the end of my rope in a lot of ways of what I needed to do or what needed to be done, and I was just not getting it all done. I knew that that was an important thing. What held me back and had held me back for years, because honestly, I knew that for a while.

But what held me back was I was not confident that I could get that next level of management and leaders to really convey my vision and live the purpose and have that same commitment that I had to our three, good for people, good for the work and good for our future. And I also knew that it was really…

probably the most important thing I could do for good for our future was to develop that next level of leadership in the company. So what I did is I struggled, Angelique, I can’t tell you how long I struggled with like, well, who should I get to be on the leadership team? And it dawned on me one day when I looked around, I’m like, well, it’s this person and it’s this person and it’s this person because they’re already doing it.

They don’t have titles, but they already come in and they look around and they say, how can we make this better? How do we support the people? How do we, how do we get better at our daily work? How do we do these things? And I’m like, well, it was kind of like, oh, well, duh. Uh, but they did not have experience in either leadership or management. So we took most of a year. It was most of 2023 to come together as that group of people and talk about.

the company because that’s a different mindset. It’s not doing the work. It’s thinking about the company itself and helping them kind of grow into that perspective around vision and around mission and around objectives. And we took we took most of a year to do that. And then we were at a point where I realized we needed some more training. So we invested another year in we did once one half of it was leadership training with we bought an outside trainer.

We did, we used the desk assessments as a way to help talk about things. And then we did one on management so that there was a pretty good understanding then of what’s the difference between leadership and management? What are the skills that you need to bring to each? And then how do people fit into those with their roles? And then it was not until the beginning of this year that we redrew the org chart and said, now here’s, now I have four direct reports.

and they have reports underneath them. So, but it took a while to do that. And I think that fear is like the way I addressed my fear of being able to cascade my vision for what a Cato was going to be and then turn loose of things that I really needed to turn loose of. They do a lot of things better than I do, you know, and I needed to get out of their way, but we did take time to make those investments so that they were feeling comfortable. And we are now

kind of closing out the year and they’re doing great. They’re really doing great. And so I’m very proud of them. I’m also proud of everybody else that’s on the teams because they’ve responded really well to having this structural change with the company.

ADAMS (34:39)

That’s great. And there’s a couple of things I want to touch on. But maybe the first thing that I really want to reinforce, because this is something that I think people don’t understand, which is that the signals that you use to kind of let you know that the people that you had been searching for were actually kind of right in front of you, were really important signals about they’re already showing they care about the company. They’re already kind of doing the extra mile. They’re already asking the hard questions about how to

to drive things forward and make things better. And those are the leadership signals that many, many leaders use to identify who has leadership potential. And so far too often people want to focus on subject matter expertise. And don’t get me wrong, I’m sure everybody on your team are excellent at what they do. It’s one of the pillars in your purpose. So I know that they have those skills.

But it wasn’t necessarily the person who said, I’m going to go and get it, three more certificates in this thing that might be coming up, technically. It was these behaviors that they were doing that signal to you, these are the people that can help me bring this company forward. And so I wanted to just to reinforce that.

TOTH (35:50)

I think it’s also important that they were doing it already. Right. Because I have had experiences with, with people, with my, with staff that are waiting, right. They’re waiting given the opportunity and it doesn’t, I don’t think really worked that way. Very often. I interviewed a young man who worked for me for awhile and I asked him one of those interview questions. You’re like, where do you want to be in five years? I want to be a lead. I want to be a, I want to be leading my own team. I said, and he was pretty early in his career. And I said,

So what are you gonna do about that? And he said, well, I’m gonna wait for five years. like, he never got there. He never got there. And I think taking your own initiative seriously and bringing things, that is a very strong leadership cue to the people around you. Yeah.

ADAMS (36:33)

Absolutely. And I’m curious how the folks that you selected, I’m curious how did they manage this sort of evolution themselves? mean, it can be a really big shift. And so it sounds like you really put some structures and some resources in place to help them along that. But were there any in hindsight, was there anything that you would do differently or you thought, yeah, I’m really glad that we chose to do these certain things to really help this leadership team transition into their roles?

TOTH (36:59)

Yeah, I do think there are a couple of things that helped. One is doing my best to provide clear expectations. And that was not easy because we were figuring stuff out, right? It was not like we had a template to follow. We were figuring stuff out for this specific company and the needs of this specific company. So that’s one. The second one is being really open and willing to hear what they had to say, their perspectives. And then…

The facilitating conversations with an external trainer were very, very helpful because it gave everybody the opportunity to be heard and to be taken seriously and to know, know, get that, reinforce that message that we are a team. But even though I may be the leader of that team and in certain respects, we are a team and it is as a team that we need to succeed. so having a

outsider who could coach me and coach them individually as well as facilitate our understand where we were trying to go, what we were trying to develop and then and nurture those skills. But I think I’d say really wrestling with what your purpose for that team and those expectations are for individuals. Clarity and expectations, I think, is critical from a leader to everybody else, to whoever you’re leading. Having really

clear expectations. In fact, I tell people on their first day of work when I sit down with them, say, okay, my job is to set clear expectations for you and to provide you with the resources that I think you need to meet those expectations. And your job is to meet those expectations or tell me where I’m crazy. And we negotiate to another set of mutually agreed upon expectations. So people hear me say that, but they don’t really believe.

the second part for a while. so having that facilitator come in and be able to listen with an external ear was helpful when I wasn’t being clear enough. I mean, I mean, everybody wants to waffle a little bit when you’re not confident in your answer. So having, you know, him call me on that going like, well, what do you really want? And sometimes the answer is like, I don’t know yet, you know, I’m going to have to think more, but I have a better question to work with now than I had before. So those should be the three things I think that were.

Probably looking back, I would say we did a good job with that part.

ADAMS (39:22)

All right, Cathy, as we wrap up, what advice do you have for engineers who are interested in pursuing leadership roles?

TOTH (39:29)

have four things that I want to say about that. First, you have to do your own work. You just like any teammate, you have to be doing the things off the court that will enable you to bring your best self and your best game back to the team. So that’s true if you’re a teammate, but also even more true if you’re in a leadership role. Leadership and management skills are not the same thing as technical skills and they need time and attention.

You are on your own leadership journey and you need to take it seriously. Whether that is using frameworks to understand more about yourself, whether that is finding leaders that you admire and inspire to and talking to them. And I will say, go talk to them. I have never met anybody who says no, if you say, I really admire you in this way. And I would love to learn a little bit more about that. Can I buy you a cup of coffee?

Never had a no to that question. So it takes a little courage to go up, but go talk to them. Find the books that are resonant with you that will help you build skills, whatever it is, but pay attention to your own leadership journey. And then really follow through on the practices that help you develop what you need to develop. So the second one is, my favorite working definition of leadership is a willingness to act. And while that sounds simple,

You never have enough information to feel fully confident in a decision that you need to make. Being willing to act means you have to get uncomfortable with some level of uncertainty and some level of risk. And that is going back to that. Like if you draw that first picture, it does feel a lot of times like putting a target on your back. But I would reinforce that the frame really is we’re here to get it right. I’m not here to be right. And I don’t have to be the one that was right. One of my favorite quotes is,

It’s amazing what you can accomplish if you don’t care who gets the credit. So that’s the second one is, you you have to be willing. And I have had circumstances where I thought I opened the door for people and they literally hid behind my skirts and looked at me like, yeah, you’re going, doing great. Keep going. So be willing to like, you know, when somebody gives you an opportunity or there’s an opening to step through and take that, even though you’re not ready, you’re not quite, you don’t think you have all the information, do your best.

And that is, again, to your point earlier, that that is a cue to people that you’re ready and willing to move forward in leadership positions. The third one is tell the truth. That doesn’t mean share everything that’s going on. It doesn’t mean telling everybody how worried you are about stuff. But give them the information that they need so that they can make good decisions for themselves. And tell them what you don’t know.

And know that in a leadership position, people are taking away probably more than you intended. So everything you say sets expectations in somebody else’s mind. There’s a great book. It’s called The Thin Book of Trust. Very practical frame, like applicable, workable kind of book about how do you build trust. And one of them is, them what they need to know, but don’t burden them with things that they don’t need to know.

But if you do always tell the truth, one, it simplifies your life tremendously by not having to remember what you lied about last bit. Tell them the truth, and that does really build those relationships. So when you have hard news or tough decisions, then people assume positive intent instead of negative intent. And the fourth one is really find ways to give back and contribute. And I do this through some nonprofit work.

And I’m the chair of the Oak Ridge Public Schools Education Foundation Board. I’ve been on that board since 2005 and I’ve been its chair since 2018. That is a public education, specifically public education is a passion of mine because I believe that we collectively need every single kid to be able to thrive, to be viable economically and be able to participate civically and.

If you’re a parent, understand making decisions for what’s best for your kid. But as a society, public education is the net that catches everybody and we need everybody. So that is a place that I found a lot of meaning and the ability to make some impact. But here’s the thing, how it connects with leadership. I found myself on a board and I’m still an independent contractor with three kids at home, right? I’m on a board with the director of the national lab.

the head of the general manager of Y-12, the president of Oak Ridge Associated Universities, the head of Methodist Medical Center, you know, and it just went on and on. I really walked in that room going like, why am I here? But I developed relationships with those people through nonprofits. And that led to other opportunities, including the East Tennessee Economic Council, which is a room full of leaders.

that you can go and just talk to you. So involvement in these other organizations is not only good for you, it gives you opportunities to develop your leadership skills. It gives you great opportunities to make big impacts on real people’s lives. But it also helps you build your network and build relationships in a way that’s not hierarchical. So when I’m having a conversation at the foundation board,

I’m having it as person to person, not my role to your role. I didn’t have to go through a secretary to make an appointment. We just had conversations. And those turn out to be incredibly valuable in building your own network as well as your own skills.

ADAMS (44:40)

Cathy, thank you so much for sharing your insights with us today.

TOTH (44:43)

Thank you so much Angelique, this has been fun.