Passing the Torch Without Burning the Family

From the headquarters of Ramsey Solutions, this is Entree Leadership, where I take calls from leaders like you about what it takes to win at any stage of business and leadership. I'm Dave Ramsey, your host with over 30 years of experience leading in the trenches right alongside you. If you've got a question you want to ask on the show, fill out the form at entreleadership.com slash ask. or call us at 844-944-1070. That's 844-944-1070. I guess that makes us a podcast that's a lot like talk radio.

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Ashley is in Boston. Hey, Ashley, how are you? Good. How are you? Thanks so much for having me, Dave. Sure. How can we help? And so we are a bus dealership. that did $120 million in sales last year. We're on pace for about $150 million in sales this year. In addition, about six months ago, we acquired another dealership. and have been in the process of merging. Wow. Congratulations. Thanks. My father is the founder. He is 77 years old, but really 77 years young because he does not stop.

He has said he has no intention of ever retiring, ever. So just he'll always be involved. When we merged, he announced. that the former president of the company that we purchased was going to be his successor. However, it became clear this summer, other than naming a successor, there does not appear to be a plan. My brother...

works for the company. He's been there for 27 years and I am very new. But my question ultimately is, how do I get my father to discuss this succession plan, both for himself and his employees? Employees are asking a lot of questions, and I don't have a lot of good answers. Okay. The first thing that comes is it's strange that someone from the outside is named a successor instead of your brother.

The way you posed the question, I immediately asked that question. Why? My brother is fantastic at operation, but it's just not the right role for him. Just he's not great at the people side of business in terms of internally. And so it was just believed that... So you mean operations meaning like logistics and getting the buses out, but not operations like the COO? Because to be the COO, you would have to be great at people. Yes. Okay. All right.

And what do you do there? So I came in five months ago to be their HR director. So they had no person assigned to do HR. Yeah. How many people work there? Between the two dealerships, 55. Okay. And your dad intends to do what with the business when he dies? Who will be inheriting it? We don't know. He won't tell us. Okay. I don't think I can help you. Okay. Because I think you're dealing with a hard head. Yeah. I will tell you a couple things to think about, but...

I don't think they're going to work. Okay. Based on everything that you just told me. So in all the studies we've done with family businesses, we have found that the most difficult... emotionally transition is Gen 1 to Gen 2 because of exactly the thing you've described. Gen 1, me, your dad, I'm 65, he's 77. We're the guys that started it.

with our fingernails down in the dirt, in the grease, changing the tire, in his case, or whatever had to be done. We've done whatever had to be done since God was a boy, and we've gutted it out, and we're stubborn, and we fight like a... dog on everything. Everything's a dog fight. Everything is a go get. And that's the founders makeup. And the thing that causes us to become successful is the thing that causes us to be lousy at succession unless we make an intellectual decision to overcome it.

Because all of those things that caused him to become successful is making him a butthole when it comes to succession. Yeah. Because he's doing it exactly wrong. Yes. Exactly wrong. He's going to screw this up. Okay. It's going to be a disaster. It's going to be a dumpster fire if he keeps going the way it is. Okay. He's disrespecting your brother. He's not listening to anyone.

He's trying to be secretive about everything, like he owns the keys to the dadgum heaven or something. And all of this is working against him. So a couple of principles that we found that causes... succession plans to have an increased probability of success. Principle number one, the more gradual, the better. The higher the probability of success.

He's violating that wholesale. He's going to grab his chest, fall back into the grave, and toss his keys out as he dies. It's the worst possible scenario from a probability of you all surviving.

Because with him dies culture, with him dies values, with him dies the stuff that brought us here that he has not systematically transferred. With him dies... product knowledge that he's not systematically transferred, customer input, vendor knowledge, all of this dies with him, and then the rest of you are left to pick up the pieces of Humpty Dumpty.

And it's the worst high, it's the lowest probability of succession of you winning, okay? The second thing that we found, high probability of succession working. The hot, unbelievable, ridiculous levels of openness and communication.

We're communicating to our vendors how the succession plan is working. We're communicating to our team how the succession plan is working. We're communicating to our customers how the succession plan is working. And we're communicating to our family how the succession plan is working. And then everyone... If they want to have some anxiety, can go ahead and have it right then. They may not like it, but this is at least what we're doing, and at least everyone knows. Because here's the problem.

If no one knows, 100% of the time, they assume it's going to be worse than it actually is. People do not assume good things. They assume bad things. Right. When people don't know, and it's going to be hard to attract talent to work for this company, and it's going to be hard to keep talent at this company because they refuse to put up with this horrible leadership style.

Yes, that is what we're facing is they're out of concern. They're going to leave the ship because they know it's going to sink. Yes.

And you can't get new people to come in. They look at it and go, yeah, I ain't got a chance. I'm not going over there. So high levels of communication, gradual is the next thing. And he's violating both of those wholesale. And it's just, it's a problem. So I don't know how to get this hard head to do it. I like him because I am him. I'm just like him. But there's parts of me that think like him. But this secrecy is going to damage the family.

This control freaking is going to damage the probability of this thing being sustainable. Okay. Maybe if you could help me just frame. I know I want to. and I have been going to him and, you know, with honor and, and. pointing out this is impressive what you've done and what you've accomplished and all of that. But dad, all the data tells me it's going to die with you because no one knows what's going on.

And all the data tells me that it's going to die with you because you're going to hold on to the keys to your last breath. And dad, I don't want that for you. You've worked your whole life to build $150 million business from nothing. And it would be a real shame for this thing to burn down around us. after you die. And all the data in family business, all the stuff I researched, Dad, says it's going to because nobody knows what's going on and because you refuse to gradually do this.

We don't think you need to leave. We love you. We honor you. We're glad you're here. But we do think you're going to have to turn loose with some stuff like knowledge of things in order for this place to survive after you're gone. That's common sense. Yeah.

It's not because we're trying to take over and not because we're trying to shove the old man in the corner in a nursing home. That's not what we're doing. We're trying to increase the probability that this thing that you have worked so stinking hard to do and have done so well with that it survives.

shame for all your hard work to go up in flames. And dad, all the data says it's going to. You can't tap somebody on the shoulder with your little sword and make them King Arthur. It's not how it works. Okay. And I don't know. Yeah, you're right. Approaching him with honor. But I think you've got to go at him because I don't think he understands anything else. Yeah. I don't think he gets nuance. Yeah. No, he does not.

I don't. I mean, if you're going to talk to me, subtlety just comes off to me like passive aggressive. You just got to tell me. But you can couch it, like you said, in honor and in dignity. It's like, hey, I love you. I'm your daughter. I'm here because I want to help. And, but dad, I am really, really worried that your legacy, that all your hard work is, it's going to be very hard to pull this off if you don't teach us.

how you want this done and open up your hand and be a little bit more open instead of so worried that somehow you're going to get fired. You ain't going to get fired. You own the place. You're not going to lose your job if you tell people what's going on. As a matter of fact, your job's going to get a lot sweeter and a lot nicer. But having done it myself, it's very emotional, actually, when you actually...

face your own mortality, and you say, oh, this isn't all about me. Who knew? I have to learn to be less important so that the thing I love, my family and my business, both survive. And that's an act of nobility that the founder has to rise above our little stubborn, selfish brat that got us here. And I've got it inside of me, so I really do like your dad. He and I would hang out together and like each other. You would enjoy him very much. I'd box his ears, but we'd hang out together.

I wish I could get you into the room. I would listen to you. Well, you can play this back for him if you want. I don't care. Because, you know, I respect what he's done. What he's done is amazing. But what he's doing is killing the thing that he loves.

He's killing Ashley. He's killing his son. He's going to kill the business if he doesn't turn loose of this information and systematically as... business acumen requires, begin to mentor the values and the culture that you want to be left behind into the succession plan and announce it to the world that this is what we're doing.

And we've been doing it for 16 years. That's how long we've been working on this. And it's working too, by the way. It's absolutely working. Our succession plan is absolutely amazing. Real proud of our team, real proud of our family and how they're in a position to do this. And I'm real proud of myself, of how I've worked myself out of a job. It's painful, y'all. It's just painful.

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Hi, Dave. Thanks for having me. My honor. How can we help? Well, I am the CEO of a landscaping company. We have five full-time employees. And we are aimed at just over $600,000 in revenue this year, up from about $520,000 last year. And my question for you is utilizing the principles that... I've heard you say many times on your shows of purchasing a business and using profit of the business to then pay off the owner over a course of several years. My question is.

We still have some business debt that we're working on. We've gotten rid of our personal debt and we're working on the business debt still. Would it be wise to purchase a second business? utilizing those principles of paying the owner of that business or the former owner in that case, only from the profits. I've heard you talk about it. So forgive me if I'm get a little choppy with my delivery. No, I got you. I know what you're saying.

So how much business debt do you have now? 105,000. On what? So we, before Dave, were very, very dumb. And the phrase you used trying to out-earn your stupid would 100% apply to me.

And we had debt on everything you could imagine. We had debt on literally nothing, right? Unsecured debt on nothing, right? Paying for a Gatorade from four years ago. And so currently right now, what we have left... is we had a line of credit that we had maxed out several years ago, and now we've converted it to just an installment loan.

and so it's about halfway gone there's about twenty four thousand dollars left on it and then we had a covert relief loan um same conversation it was fifty thousand dollars about half left about twenty four thousand dollars on it coincidentally And then around $50,000, a little over $50,000 left on the property that the business is on. So I don't know how you, I know sometimes you talk about.

the real estate different than the business itself but there's around fifty thousand dollars owed on the property so what's your profit on 600 grand Currently, for this year, we're right at $500,000 now, and we're currently sitting at $76,000 in profit right today from the current P&L. And that's after I've been paid. That's after everyone's all payroll is paid. How much are you paid out of that? In a given year, it's around 73. I don't know what it is to date. That's fine. Okay. Yeah.

All right. So you're going to make $120,000 by the end of the year profit? Yeah, I think it'll trend a little more than that. But it's not maybe $110,000. It's not $180,000. Correct. So you're making $100,000 a year, plus you're paying yourself $70,000. So you're making $170,000. You owe $50,000 and $50,000. The problem is that if you take on this other business, even with the formula we use, the process that we use that you're talking about, it's going to take up...

more of your brain space. That was my concern. Yes, sir. And it's possible that that could cause the current business to become less profitable because you're trying to spend more plates. That makes sense. That was my main concern. Will it be a distraction? Yeah, exactly. So what is it? I'm curious, if you're buying a landscaping business, what do you get?

Well, it would be a landscape supply business is the business in question. So I own the landscaping company. And so it would be able to sell hardscape materials. So like a nursery. You're like buying a nursery. Yeah, it's not a nursery, but yes, it's more of the hardscape supplies. Oh, it's only the hardscape. You're not selling plants. Correct. No plants. Correct. But same, you know.

Same church, different people. Yeah, so you're going vertical rather than horizontal. Okay. And what are the numbers on the business? I'm just curious. Honestly, I didn't get anywhere near that far yet. This is more of a, is this a smart diversification? I didn't put a lot of brain power in it yet because I was worried it would be a waste of time.

The question's a little bit more philosophical. Yeah, I got you. I got you. I'm okay with that. I'm just curious. Just trying to figure out how all this works together. Okay, diversification vertical or horizontal is not a bad thing. Buying up competitors or buying up suppliers in this case is not a bad thing so that you've got more control of your workflow. You make profit on both ends. You know, you're controlling the sale of the hardscape.

and you're controlling the purchase of the hardscape. So this is really great. All of that is positive. It is a new business. It's a business you've never been in. Correct. Because it's not the business you're in now. You're dealing with both wholesale purchasers like yourself, and you're probably dealing with some direct-to-consumer purchases, right? Some retail.

Yes, sir. Little Susie needs a rock for her front yard and she wants to come by and buy it. Yeah. Okay. There's absolutely nothing wrong with the whole idea. I always answer the question, and the reason I'm just hedging around, I'm turning it over in my little brain. What would I do if I were in your shoes? Okay. I like... the cleanliness of being debt free so much that I have throughout my 40 year career, 35 year career at Ramsey.

I have curtailed our growth if it meant being in debt. Okay? Okay. In other words, I've not done things that required debt, and so we have grown slower. but more sure-footedly. The way that would apply to your situation is it would cause me to pay off the debts before I started buying businesses. Okay, okay. And so I'm going to do that here because I want to be more sure-footed. I'm moving into a new business that is different than landscaping. It's a cousin, but it's different.

Because you've got a different type of retail customer here, more of a do-it-yourselfer. You've also got the wholesaler like you. So some of your current competitors, gosh, I don't know if they'll buy from you or not, if they know you own it. Well, yeah, correct. Excellent. variable that I just don't know the answer. I don't either. I don't either. And I don't want to learn all of that while I owe this other guy money out of the profits and I'm over here trying to pay back a stupid COVID loan.

Okay, yes, I see what you're saying. If I'm going to learn those lessons, I want to learn those lessons with more margin in my brain and more margin in my bottom line to do that. So it's probably a hard pass for me. It's one of those times I'm going to grow a little slower so that I'm sure-footed.

And I'm debt free is what that means in my case or your case. So, yeah, it's not a bad idea. It's worth having the discussion. I appreciate your question. It's a good question. You're obviously doing a great job running the business you're running. Yeah, I would say whatever brain power and bandwidth you have that you might have applied to that, I would apply it to running your gross revs and your profits up over there. Let's just try to...

Instead of adding 100 grand a year to this thing, let's add 200 or 300 grand to this thing. And let's spend our energy there doing something we know how to do that creates a predictable result that's templated almost. versus stepping over into something that's more unknown and higher risk for that reason. It's not that high risk, but it is higher just because of the unknown. It's a cool question, Luke. Very cool. Thank you for calling in with that. I love it. Very, very good stuff.

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Again, that's salesgravy.com slash ENTRE. Go get it. Well, one of the things about doing a podcast and doing the things I get to do is I get to meet some of the... smartest and kindest and best people on the planet and then I get to become friends with them and that's even better that's the best part and that has definitely happened with my friend Arthur Brooks

Harvard professor, bestselling author. A new book is called The Happiness Files, Insights on Work and Life. He'll be one of our speakers at Entree Leadership Summit coming up in May in Orlando. And every time I was telling him back in the green room a minute ago.

Every time I pick up my phone or turn on my computer, there you are again because you're everywhere. Everybody wants to talk to Arthur Brooks. You are a hot commodity right now. And as you said, it turns out happiness is back in style. Yeah. thing people want it turns out newsflash but you know it's not the milk man it's the milk it you know when you when you talk about happiness and the science of happiness now people can get happier

And by the way, you've done that too over the years. You've talked about the ways that people can get their lives in order such that they can actually find their happiness and not distracted by all the junk that makes it harder. And you've helped my family.

Well, if you chase happiness in the wrong place, you will catch it in the wrong place. And if you distract yourself. Then it doesn't stick. It's not real. Well, not only that, but, you know, I've done all these studies about, for example, debt and saving of money. I mean, I was trained as an economist originally.

The best way that you can actually become unhappier is to borrow money for consumption. The single best way that you can become unhappier right now with money is by running a credit card balance. Second best way is to have a car loan. I love it. I love it. Well, definitely part of the family, for sure. You got it. You got it. And you've done so much for my family, too. I told you before, my son has been a listener of yours for a long, long time.

The times when he wasn't listening to his dad, sometimes he was listening to Dave Ramsey, and that's even better. Oh, he got the same haircut. Not quite as thin and fit, but got the same haircut. So it's right there. So a lot of people are watching this, our business owners and leaders, our entree leaders out there, and they've got these.

Direct reports, they oversee a whole team of people, sometimes too many people. And you've said our most important employee is ourselves. I completely agree with that. Dealing with a guy in the mirror is like a full-time job. Talk about what you meant by that. You know, we are, each of us, entrepreneurs. We are the founder and CEO of...

ourselves incorporated. And if we don't see ourselves as an enterprise, we don't see ourselves as a startup, then we're not going to have the adventure that our life should be. Now, the fortune that we're trying to accumulate is not green pieces of paper called dollars. It's love and happiness. But we should be willing and able to take prudent risk in search of a fortune and love and happiness. And how do you do that? What kind of risk do you take? By giving your...

heart away, by worshiping abundantly, by loving all the time. And if you're not taking care of yourself and you don't understand yourself and you're not a good human resource management manager on the inside, that stuff's not going to get done. You know, if you love your team member and you're looking over them, you're concerned about their personal life. You're concerned about their growth patterns. You're concerned about their physical condition. And so...

Just extend that same thing right back at yourself, and that's your best investment you can make. It turns everything around. That's a good point. I love that. Maybe you guys out there don't know, but this guy has done more research. Arthur's done more research on happiness and the functions around it.

the statistical analysis around it than anybody on the planet right now. He's a Harvard professor, as I mentioned earlier, and best-selling books, multiple, all on this subject, and speaks hundreds of times a year. When there's a lot of this out there connecting, and I think there's a lot of it has a 98% truth and ends up being toxic when it's done wrong, but this connection between happiness and work. Yeah.

I mean, there's a thing of, oh, follow your passion, even if you have no talent. That's a bad idea. That's not going to create happiness. It's going to create disappointment and embarrassment. uh american idol who can't sing but his parents never told him you know so there he goes out in front of the whole world and messes up right so uh you don't want that so don't follow your passion that's that's that's kind of thin and lame

But there is a real connection between just the ability to get something done. And, you know, I remember as a kid just cutting the grass. Yeah. And my dad, we would get done, you know, you mulch the bed, you weed eat. And you just walk out in the front yard and stand there for a minute and go.

That looks good. I did that. There's a tide of that, isn't there? That's what we call in my business, earned success. And that's really everything. So there's really two things about jobs that will bring you enduring joy. Now, everybody talks about work-life balance. Everybody talks about burnout. and all this stuff. There's a lot of research on those subjects. Work-life balance is stupid. You need work-life integration because your work should be part of your life.

but it shouldn't be. Your whole life is what it comes down to. The two things to look for in a career and a job, which young people should be thinking about and all of us should be cultivating, are earning your success, meaning that your hard work... Personal merit, responsibility being rewarded and recognized and acknowledged.

That's what you want. So when you cut the grass, it's measurable. You did a thing and your dad came out and said, it looks good. That was earned success. And there's a version of that in everybody's job. That's not the only thing. The second thing is you need to be serving somebody else. You need with your work to be needed by somebody else. It shouldn't be something, you know, you paint a picture and then burn it, for example. It has to be something that serves the world.

earn your success and serve the world. Some days it's going to be boring. Some days it's going to be interesting. Some days you're going to feel passion for it. Some days you're not. But the whole point is every day you're creating value and every day you're serving the world. And that's the best that we can do. And that's a lot.

Schweitzer said, those among you that are the happiest will be those that learn how to serve. Yes, indeed. Yes, indeed. Look, I mean, what a privilege it is to live in this world and to serve our sisters and brothers every day. And, you know, some people can do it in an audacious way, like Dave Ramsey. where you've got this big thing, well-known, real famous. But that's not the point.

The whole point is if, you know, I was doing a show in New York, a television show, and we had a live studio audience that were asking me questions. And one guy says, you're always talking about calling, about finding your calling. How do I find my calling? I sit in a cubicle farm doing data analysis, and I feel like a dream.

drone is boring. I said, okay, here's the deal. There's somebody in the cubicle farm next to you, the drone next to you. At two o'clock in the afternoon, go to the break room. pour a fresh cup of coffee and bring it to the guy in the next cubicle and say, you look like you use a cup of coffee and look at the look on his face. You just served him and you'll become that guy.

And pretty soon you'll become that person in the office. And weirdly, you're going to start liking your job more. Because serving other people is really what's the most rewarding thing in our lives. Yeah, even if it... Not tied directly to the data analysis. Just some way in the process, find a way to serve. Yeah, and the weird thing about it is that...

I've got the data. You're going to like data analysis better when you're the person serving the people in the cubicles around you more fresh coffee. Yeah. Because happier people like their jobs more. Wow. Okay. So, yeah, the irony of the whole thing, what you're saying is, is the people that are selfish are the most miserable. Yeah, for sure. For sure. I mean, like Mother Nature doesn't care. I mean, Mother Nature is funny.

We have an animal impulse and we have divine moral aspirations. And when we live in the animal impulse of me, me, me, that's called the psychodrama. You know, it's my job, my car, my money, my television shows, my friends. It's so boring, Dave. It's so boring. It's so tedious. But Mother Nature wants you in that zone because that's what keeps you alive another day.

better able to pass on your genes, but you have a choice of getting into that divine space. And the way that you do that is by transcending the psychodrama, transcending the psychodrama by praying. or through meditation, and certainly through serving other people. And the more that you get out of the me, me, me into the standing in awe of the world, standing in awe of the creator, standing in service of other people, your life starts to change.

When I've been talking to people about money over these years, I've been very careful to never send the message that money makes you happy because it doesn't. That's kind of shallow and ridiculous and those kinds of things. And yet we're teaching people every day to build wealth and to control this variable because it impacts so many areas of our lives. But it literally does not make you happy. We always teach people the more wealth you get.

You become more of what you already are. That's correct. And if you're miserable and depressed, you're going to be really miserable and depressed with $2 million. If you're rich, rich people who are miserable people become rich, miserable people. Exactly. And they're more effective at misery. They can do it with scale.

Whatever it is, good or bad, it's inside of you. It's going to come out. Fame will make you more of who you are. Power will make you more of who you are. And wealth will make you more of who you are. Yeah, it's exactly right. And yet... I see this, and it makes common sense when I see it, but I don't like the spiritual message that it sends. But there's a ton of research that shows to get enough money for sustainability.

There is a correlation to happiness. Yeah. I've studied this my whole career because starting out as an economist and then going to the happiness profession, the first thing people always ask is, What's the connection between money and happiness? At very, very low levels of money, what you find is that money per se can eliminate some of the sources of unhappiness in your life. And unhappiness and happiness are not opposites. They're actually processed in different hemispheres of the brain.

We have happy and unhappy emotions for very different reasons, and we need them. We need negative and positive emotions. They're an alarm system, effectively. If you didn't have fear and anger and disgust and sadness, you'd be dead in a week. They're really, really important. But when they're exaggerating,

by worldly circumstances. You can't pay your rent. You're worried about your kids getting food. You can eliminate some of that stuff with relatively low levels of money and then your brain plays a trick on you. And I remember this from the age of 19 to 25, I didn't have health insurance. I didn't go to the dentist one time from the age of 19 to 25. I was a musician in those days. And I didn't make a whole bunch of good decisions. So the result of it was that I didn't have any...

health benefits and when i was 25 i took a job in a symphony orchestra i was classical musician and i had a dentist for the first time i went to the dentist and he filled 12 cavities and i felt much better and i made the incorrect conclusion that money bought happiness No, what it had done was that it had sorted out some big self-imposed problems in my life. And that's an important confusion to avoid. What you find is that once you get past a relatively low level of income...

Then if you don't spend money that you have, you're blessed to have sustainability. If you don't spend it in the right way, you will be chasing, chasing, chasing, chasing for the rest of your life. And that's a curse. if you're like hey man i mean i i felt so much better when i when i got when i doubled my income and went to the dentist

If I went from $750,000 to $800,000 a year in income, that's $50,000. I'm going to like it better because I can buy better watches and fly first class or something like that. And that wasn't it. I guess I needed another million. And people sit on that wheel for the rest of their lives. There's a hack, though. There's a workaround. And it gets to exactly what you were talking about. Money won't buy happiness. Love will bring you happiness.

If you can turn the money that you have, the disposable money that you have, into love, then you win. And that does not mean buying a boat. That does not mean being a better car than you need. Does that look like generosity? It looks like love toward other people through generosity, for sure. It means buying experiences with the people that you love. It means buying time and spending it.

personally in edification worship for example not frittering away your time on instagram or spending it with people that you love it also by the way means saving your money i've got tons of data that show that when you feel like you're making progress in your life for a better life for you and your loved ones, by saving your money, you get happier. So there's four ways to bring in greater happiness with money. And none of them have to do with buying the Ferrari.

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In the show notes. So changing gears. Leaders have to give. have to have to engage in accountability yeah and course correct the team member so that's always going to involve those days that leaders hate which is like every other Day that we hate when I'm leading because it means I've got to look at someone I love and have a difficult conversation. And it's going to be uncomfortable. It's going to be awkward.

But it's the only way that this relationship and this process survives. So it's got to happen. And so I've got to sit down with them. And that, you know, the thing that we is, unless you're just a jerk. you know unless you're a bully um you dread making someone feel bad right you know because by definition i'm going to make you unhappy for a minute when we have this conversation because it's going to sting no matter there's no way to couch it

There's no amount of words. There's no way to do that. So what's the science say about that kind of feedback? The science says that the best leaders, no, let's start with the worst leaders. The worst leaders are so empathetic, they can't do hard things. In other words, I feel your pain and I'm paralyzed by it. And we have an empathy-based culture. We have an empathy-based public policy system that treats poor people like wards of the state.

And treats them in such a way that actually takes their dignity and actually doesn't build them up into the kinds of people that we would want our children to be. And that kind of empathy is paralyzing. That kind of empathy is really deleterious for leadership and management and family life and communities and you name it.

But that doesn't mean that feeling somebody's pain is a bad thing. It just means it's part of the process of what we really need, which is compassion. There's never too much compassion. Compassion says it's a harder thing. It requires, you know, good leadership. And by leadership, I mean like parenting.

is really a leadership lesson. So it sounds like, Dave, you and I are talking about CEOs. No, we're talking about dads and moms a lot because that's the ultimate leadership experience that most people have. Starts off by understanding a problem. and then by feeling enough of the pain to internalize it. And then we go from there to figuring out what needs to be done and then having the courage to do it, whether the person we're doing it with likes it or not, because we do it out of love.

and not being paralyzed by the empathy. And by the way, the worst parents of teenagers are the ones that can't do the hard things. The best parents of teenagers say, yep. God put me on this planet to be his dad and not to be his friend. and I knew what the problem was, and I remember when I was that age, and I told him the truth, and I brought down the hammer, and he doesn't like me right now, and I'm really grateful to God that I'm in his life like this because he needs it. Yeah.

Otherwise, he's going to run the car in a ditch, metaphorically or actually. Yeah, and that's with your employees, and that's with the people in your church. And, you know, you must have the love and compassion to do what needs to be done. Yeah, so adults. In those situations, you're saying we – love requires us to speak up. It does. Love requires us to do that. The other –

thing we call love is not really love, it's enabling. For sure. It's just soft. Yeah. Because no one is winning when you give a drunk a drink. Absolutely not. Jerks will often use this, and they'll twist it slightly. Jerks will say, I am giving you the truth out of love, and then what they're doing is using the truth as a weapon and not as a gift.

And so they'll do that a lot. You know, there are people who on television, this is what television political pundits do constantly. This is a big problem in our country today, which is, look, I got to be truthful. I'm a Christian man. I got to be truthful all the time. It's not a Christian husband who goes to his wife and points out every single little flaw all the time. On the contrary.

But it is a Christian husband or wife who says to the spouse what needs to be said for their good in a spirit of love. That's the kind of truth we're talking about. We're just simply not going there. Yeah. And it's just, you know, and those are interesting conversations. Totally. You know, we're just, the answer is a solid no, and let me walk you through why, and we're just not going to do this. And it's such a...

How many years have you been married? 43. Nice. I've been married 34. And I'm still in love. You too, right? Absolutely. More now than ever. I know. I told her if she leaves, I'm going with her.

Hey, honey, you can leave me, but you have to let me come with you. That's right. That's how this is working. So let's wrap it up with this idea. What are some simple habits business owners can start doing? to create this environment where there's just kind of happiness in the air, so to speak, the culture. It's a cultural icon, if you will. But it's a byproduct. It's not a...

It's something that occurs because you did other things, right? Right. No, for sure. And there's a ton of really good business practices that I've written about. exhaustively. Every Thursday morning, I have a column in the Atlantic called How to Build a Life. And about every fifth column is about what business people can do to have a happier workplace. There's a lot of specific techniques, but here's where it starts.

If you want people to be happier at work, which you should, by the way, it's even a good business practice. I've got the data that show that the 20% happiest workforces in the S&P 500, they outscore the index by about 500 basis points. Whoa. This is good business, right? And a lot of CEOs are like, wouldn't it be lucky? No, no, no, it's not luck. Here's where it starts. Work on your own happiness.

People don't want to work for a miserable SOB. They don't want to do it. They don't want to work for a miserable person. And this applies to everything, too. You know, the stupidest kind of parenting ever here is... starts with this idea, you're never happier than your unhappiest child. That's really dumb because nobody wants an unhappy mother. Nobody wants an unhappy dad. You can't help your child by being as unhappy as your child. That's just that raw.

weak, flaccid empathy. That is the biggest problem inside families. And so if you want a happier company, start working on your own happiness and that will become infectious. That's interesting. You know, we, we, end up with the world that I'm in and the world you're in where you have a certain level of notoriety that people are coming at you with these negatives and people are coming at you with these positives.

And, you know, sometimes they're 45 seconds apart. I know. You know, it literally is, it's crazy. And they're both extreme. I know. The extreme is like, you know, you changed my life. No, you changed your life. I just showed you how. Yeah. And the other one is like, you're going to hell. You're the worst cult leader. I know, I know. And they're 45 seconds apart. It's very, very interesting. And so one guy the other day, one of my buddies, he said, you know, Dave.

how do you handle all that, all the negativity, all the stuff that comes at you? I'm like, dude, that's just the price of admission to get to be me and I'll pay it. It's a good life. My life is awesome. It's awesome. But also, you know, the truth of the matter is that. That fame made Dave Ramsey more Dave Ramsey.

And so the real question is, who are you integrally as a person? The fact that this life is a good life and you like it suggests that that was an accelerant to the goodness that you had and that you could have been had you been a roofer. That's a really, really good thing. Your apostolate, your mission was to bring these ideas to more and more and more people, and being a roofer wouldn't have been the highest and best use.

But I think – let me ask you about this because I agree with that. I agree. You do become more of what you are with fame, power, money. I don't disagree with that at all. I completely teach that concept, too, and I'm glad to know that research actually backs it up because I just pulled it out of my ear. Well, your ear's got a lot of... Yeah, it's got a lot of stuff in there. It's got a lot of good knowledge in there. Also, that was true when I was 33 and I'm 65. Yeah. And so I've watched...

Men and women in leadership get better right and in their character and grow in They make better choices, make better character decisions. And like you said, you kind of straightened up your life in your early 20s there. And so you didn't... Who you are didn't change, but you're tapping into a much better version of you. So personal growth for these leaders is...

still necessary, even though it's exposing who Dave Ramsey is or who Arthur Brooks is. And one of the things that actually really helps us a lot, quite frankly, just to be honest about this, and this is from a scientific perspective, is having a supernatural perspective on your life. Oh, absolutely. If you're answering, I mean, you're not answering to the, you know, the owners of this company. You're not answering to just your audience. You're answering to God.

You really are. And so the result of it is that when you have more resources, when you have more notoriety, when you have more persuasive power, then the stakes go up. And that means you need to be better, not worse. And a supernatural perspective on life is critically important. All the people who are your fans and who are gaining financial independence, thank God, and are doing really well in their jobs and are hiring people and their businesses are growing, you need to be better, not worse.

The stakes are going up, man. And that's a huge responsibility, by the way. And it truly is believing that you want to know the answer when you say, what would Jesus do? And I really want to know. Yeah. And sometimes it's not clear. It's not a bracelet. You know, I mean, this is a thing. Yes. It's a way, it's a worldview. It's a way of life. And you go, and in the moment.

when you want to choke someone or in the moment when you just got to stop and go. And you're right. I think that elevates you out of your lizard brain. Yeah. Faster than anything else does. Yeah. That's a technique, believe it or not, in our business called metacognition, where you actually have a set of impulses and you reflect on them. You have a technique for reflecting on them. Some people journal. Some people go to therapy. Some people meditate.

meditate in Eastern techniques. Um, you and I lift things up in prayer. That's what we, that's medical ignition that moves the experience of your emotions into the prefrontal cortex of your brain, right behind your forehead, your executive centers. And there you can actually make the decisions that you want. make and be the person that you want to be.

Critical thinking skills exist there. They do not exist deep in the lizard brain and the emotions. The limbic system is not good at making the smart decisions. It'll get you out of traffic, but that's about it. You'll jump out of the way of the oncoming car. Yeah, that's what I mean.

The oncoming car, you're not going to get hit. Yeah. Ah, The Happiness Files, insights on work and life. Arthur Brooks, we could do this for hours, you and me. We may just keep going out here without a microphone in a minute, just because we like hanging out together. He's going to be with us again in May in Orlando, Florida.

Thank you, my friend. Appreciate you hanging out. Great to be with you. This is incredible. Be sure and check the book out. Be sure and come to Summit in May and consume and see anything. You get the opportunity that this guy's involved in. Obviously, he's... Stone Cold brilliant and a solid guy that every one of us would love to hang out with.

I get that pleasure. Hey guys, remember better a weary warrior than a quivering critic. This world needs more high quality leaders. So take courage and lead. I'm Dave Ramsey, your host. Thanks for joining us on Entree Leadership.