The proverb is very simple but speaks a lot. If you say that someone calls a spade a spade, it means that the person is frank and outspoken. He will express himself and speak frankly about anything and anyone.
Today the world is full of persons having honey coated tongues. Whenever asked for a frank opinion, we will think twice as; if I speak frankly that person may not digest the fact and he may not like it. So in pretence we hide the truth and spell out lies. In practical life we should have the guts to spell out the truth. The listener may not like it, but the truth remains the truth. Today he may not be able to digest the truth but later on he will realize that the truth helped him from falling in chaos. This is especially true when a close accomplice asks an opinion as he is unable to take a decision. Presenting a rosy picture will keep him happy and contented in the short run. However the truth will help him in the long run.
A spade here could mean a shovel which is used for digging or spade is found in playing cards. However, there is a reference whereby the spade in playing card was a term for Black people in United States. Hence sometimes in this proverb there is a racist origin which means calling a spade a spade refers to the black. However, we prefer to keep such opinions aside and do not consider them relevant.
In the real context one has to understand the true meaning of the proverb and practice it in its true sense. Come what may learn to speak the truth, be frank and put forth your opinion, however avoid being too blunt. Try to be genuine and convey your true opinions. Such people are always respected and held in high honor. Sugar coated persons are not trusted much. Hence learn to call a spade a spade.