The Simple Strategy Dave Uses to Motivate His Team

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. 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 entree leadership.com slash ask.

Or call and leave us a note and we'll get back to you and get you on the show. The phone number's 844-944-1070. That's 844-944-1070. We're glad you're here. Luke is with us in Alabama. Hi, Luke. How are you? I'm good. How are you? Better than I deserve. What's up?

So I'm the owner of a dog resort. We'll do about one point four million in revenue this year. And my question is how do I instill an ownership mindset into my team? Wow. Well, there's a lot of things involved in doing that at Ramsey. Um one thing is compensation. Uh as much as you can. Let them be rewarded when there's profit. And let them feel the pinch when there's not. So they have incentive to keep expenses down and revenues up and we talk about that a lot around here.

uh because we share we have a profit sharing program that we developed. On something as small as you're doing, you could keep it very informal and say, Hey guys, we had a great month because you did and give some examples of something that caused revenue to go up or expenses to go down. And so I'm gonna give everybody a hundred dollar handshake or whatever, right? Uh how many team members have you got?

Uh we have six full time and then about twenty part time. Okay. Much harder with the part time because they're more transient and they're not there as much. You th you don't keep'em as long, the turnovers higher. And you don't keep them as long. So that's a harder thing, but you just kind of build it in. So one of our core values on the wall is we're all self-employed. We have a self employed mentality and we talk about what that means a lot. So one is you do it with compensation.

Two is uh you you do it, I mean, with like a a manager on the compensation side, if you want to your senior people, you actually could let them participate in the profits in some way.

You could figure out a little formula to do that. But anyway, number one's comp. Number two is is it's we talk about it a lot. It's a core value. And then the third thing is you hire for it and fire for it. So when you're doing the interview to hire, you say, Hey, the people on our team

Treat this place and our customers like they're one of the owners. We have an ownership mentality, a self employed mentality here. How do you feel about that? Will you fit in with that? That's part of your interview question. And you're trying to s trying to solve for that. Are they gonna come in and act like they're an owner or are they d got a J O B and they're gonna mail it in, come late, leave early and steal while they're there? We call those employees.

Not team members. We don't want em any employees. We want team members. And so we if you're if you're just looking for a place to collect a check, you got the wrong place. Because we take our business seriously. People love their pets. how their pets are treated, how the customer is treated is indicative of how we're gonna treat their puppy.

and they care deeply about the whole experience. That's why they pay us ridiculous sums of money in a dog resort, a pet resort to put their dog up. And so we're gonna treat them with ridiculously good care. And we're gonna smile and we're gonna enjoy doing that like we own the place. Do you want to be as part of a team like that?

And and tell me why and tell me what that means to you. And that's part of your interview question scenario where you're getting into the whole thing. This is who we are and you're not gonna fit in if you're just here to collect a check. This place will spit you out.

We talk about that in the hire and that runs off some people'cause you got people they're just like, How much you pay a hour? You know, it's like, No, I don't need you don't we you don't get to work here. We don't we don't talk like that, you know. So no, I mean we do want to tell you what you get paid, but that's i your first thing out of your mouth is what you get rather than what you give. No. Then the third thing is we fire for it.

And so if we let someone through the hiring process, they get through the screening process and we look up and they're just mailing it in, they got a bad attitude, they don't care. They're they're not got a self employed mentality. We talk to'em about it and say, Hey, remember in the interview and remember this thing on the wall that says self employed mentality and remember that's how everybody else here acts? Well, you're not acting that way. And a we

does that. And if you wanna be part of us, you wanna be part of we Then you're gonna do that. That's part of that's a condition of further employment. Do you wanna plug in and be part of the team here and Start caring about this place deeply or are you just trying to are you just trying to collect a check? Because if you're trying to collect a check, we made a mistake and you made a mistake and this will be your last day. It doesn't matter to me. Which one do you want to do?

And you can be a little less blunt than that, but that's the essence of a series of difficult conversations with your team member that uh depending on how long they've been there as to how much leniency there is on that. But we First, compensate for it. Second, we we talk about it a lot, reinforce it, and third, we hire for it and fire for it.

Okay. That makes sense. And if you do all of those, over time it'll settle in. But it it's not instantaneous. And and you will have to constantly be polishing. Meaning somebody's gonna have to leave. And we're gonna have to constantly, you know Change up our interview script a little and make sure you fit into our culture and our team and and do you wanna be this is how we do it. Do you wanna be a we?

You know, and and you just over and over and over and over until you're sick of saying it, and about that time's when people'll start hearing it. Right. That makes sense. Yeah. How long you had this? Uh about a little over three years. Wow. You're doing great. Exploded, didn't it? It uh it did. A lot of people got dogs during COVID. Yeah, that's true, I guess. I hadn't thought about that. There was a like a dog shortage. Yeah, there was. You couldn't find one, yeah.

That's funny. Yes. I love it. It's been growing, but uh seems like the more we grow, the more uh cracks in the foundation become Visible. Oh yeah. That's true with anything. Yeah. It it mag the i the i the success magnifies the good and the bad in in your organizational processes. Right. Absolutely. You get really, really strong on some things you were strong on and the things you were weak on, you're like, whoa, we gotta fix that.

And I my guess is that it's probably a lot harder with all your part timers to get them on board with what we're talking about in this call than it is your full time. Absolutely. Yeah. Absolutely. And so what I'm going to start doing is to kinda always think about taking a page out of the Chick-fil-A book. They've become known for a great place to send your teenager to go work.

Because they'll teach'em how to work and teach'em how to think about others and train them to say it's my pleasure and you know, they'll y a teenager that's worked at Chick-fil-A had a ha has had a good working experience and they're probably not gonna end up working at Chick fil A after college, right? But they they still send their kid there because they've got a great reputation for that. And so you become a training ground for

uh this issue of uh self employed mentality. When you work over there If you love animals, Luke loves animals, and Luke's good to those animals, and you're going to be good to those animals, and you're going to care and you're going to show up and you're going to work your butt off and he's going to pay good, but he's also going to teach you a lot about business and customer service.

and pet care and whatever else and you're gonna come away with some knowledge base So if you get a job over there it's not just oh I got a teenage job it's Oh, I got a the teenage job because Luke's so good to teenagers training them, college students training them, giving them a you know, a a a a positive ministry experience where they're working with people and animals and all that. It's all good.

Yeah, so you gotta kinda get that built into the thing from the outside, looking in, and then you can start to attract part-timers that aren't just looking for a paycheck. Because they're going to do the least possible work to get the paycheck if that's all they're there for is to look for the paycheck. They're going to care the least they can get away with if they're just there looking for a paycheck.

So very good question, sir. Sounds like you got a great business going on. I love it, man. I'm proud of you. Keep it up and uh thank you so much for the call. Sales Gravy understands that managing a sales team is one of the toughest jobs in the business. You're trying to get your team aligned, motivated, and paid in a way that drives real results, not just busy work. But let's be real, if your commission plans aren't working, that mission turns into a daily battle.

You're fighting to spark the right behaviors without setting your budget on fire. And instead of leading with confidence, you're stuck second guessing every comp plan that's rolled out. Sales Gravy walks this road with sales leaders just like you every day. Leaders who are tired of chasing short-term wins and ready to build something sustainable. That's why SalesGravy created the Sales Leader's Guide to Incentives and Compensation, the ultimate roadmap to help you lead with clarity.

This is a battle-tested blueprint that shows you how to build comp plans that align with your goals, motivates your team to hit their targets, and gives you the confidence that your compensation is a strategic asset, not a liability. And here's the best part. This guide is free, but only at one place. Salesgravy.com slash entree. It's exclusive for our entree leadership audience. Again, that's salesgravy.com slash E N T R E. Go get it.

Listen up, your business won't grow until you do. When you lead better, your people perform better, and your business wins bigger. That's why you've got to come to our next Entree Leadership Summit. It's the premier event for leaders in North America who are serious about growth. You're gonna spend four days getting insights from world-class leadership experts, including my friend Will Gadera, the New York Times bestselling author.

Of the book Unreasonable Hospitality. Vanessa Van Edwards, the national best-selling author of Captivate, the Science of Succeeding with People. Brian Buffini, founder of North America's largest real estate coaching company and one of the most popular speakers we've ever had. Duncan Wardle, former head of innovation and creativity at Disney, and more, including my friend Pat Lincioni, one of our

most popular speakers. He comes back almost every year. And the best part is it all happens at Disney's Coronado Springs Resort in Orlando. To join us May seventeenth through twenty of twenty six. Visit entre leadership dot com slash summit or click the link in the show notes. Manny is in Dallas. Hi Manny, how are you? So well, Dad, how about yourself? Better than I deserve. How can I help?

Uh well I have a HVAC business, um that's growing. We started in twenty twenty one. We have a team about three to four with my wife and myself included. And uh we're actually going through a divorce currently. And I'm trying to figure out how to proceed going through this divorce. Really because um the way that the business is set up is she's actually ninety eight percent owner of the business.

And I'm two percent owner. And our CPA told us to set it up this way for tax purposes. Uh she mentioned it's no point of both of us getting taxed when the accounts being the money going to the same account. Well, uh um, now that we are going through this divorce Um I'm not sure'cause there's been very limited communication between us now. And even though she was the ninety eight percent owner, I did ninety eight percent of the work.

And all I want from this business or from this divorce is the business and I'm letting her know, hey, you can keep everything, the house, the the bank accounts. I just want the business. And she just keeps telling me I don't know. Uh so I'm at the point where I'm either gonna dissolve the business and start something new or uh depending on what she wants to do, depending on our mediation.

Uh I don't wanna dissolve our business because we already have government contracts. Several contracts, government, private, you know, residential. We have a lot of contracts already. Um so that's my question in a nutshell. Hmm. I'm sorry. So I sh I take it she used to work there and she doesn't now?

Well, she yeah, she doesn't. She doesn't do anything. She's supposed to, but sh I haven't seen any activity on her end as far as the government contract that's the same. How long has this been gone? How long has she been out? I would say now about a month two m since October. She's been completely like off hands of the business. What happened to your marriage, honey? Uh I didn't uh prioritize our marriage.

Um, I was um very selfish I would say and I think I prioritized more of the business. Even before starting the business, I always prioritized work. And I thought uh yeah, providing and uh giving you know, providing a a roof, food. I I thought that that was enough, but uh I'm realizing now that's that's not enough. I d I needed to pour into my relationship and I wasn't doing that.

Okay. Um so the mediation is called for about a week from now. Yeah. Okay, that works. And um All right. Well, at that point you're gonna know what you're gonna have to do, right? She's either gonna she's either gonna agree with you take the business and she takes everything else at the in the mediation, or you're gonna have to go get a job or start your own heating and air business. and contact each of the contracts and let them know that the other thing's probably going out of business.

Correct. Do they want to move their contracts over to you? Yeah, and that's I mo most More than likely that will happen. Uh that's the thing I don't want to do because I'm already established and Well, I you won't have a choice, honey, if you if you can't get this resolved, you're gonna have to go do something. You can't just sit with her owning it and you working there. Right.

No, that i it won't. And I have uh So she's either gonna give you the business or you're gonna close it and start another one and move your contracts over, which is a pain in the butt. But that's what divorce is, it's a pain in the butt. Right. It is Uh and then g well I guess

going forward, depending on what happens, either if I do end up getting the business a hundred percent or d dissolving starting something new, um I have my brother who is he works for me. He's as an employee, but I wanna bring him in as a partner. No, you don't. You've had enough partners, huh? Did you not get enough of this already? No, he's not a partner. He just works for you, period. No. Good Lord. That's what you're just going through is breakup of a partnership. Right. And and

divorce is nasty, but no, I mean this is even nastier. No, you don't need your brother being your partner. If you want to share some of the profits with him as part of his comp plan, that's okay. But he does there's no need for him to be your partner. You guys don't have anything. It's just two guys in a truck. Right. You just need to go make some money. Go get some deals. It's not a problem. I c I can do that easily. Um Yeah, but that doesn't mean you need a partner.

Okay. Which is something that I already kind of like promised him and well, just tell him you made a mistake. Okay. Sorry, I can't do that. I c I will share some of the profits with you, but I can't share the ownership with you. I got burned on this divorce thing and I've got to keep the ownership in my name.

Okay, okay. Go on staying in that page, which quite honestly I feel comfortable with that. I I guess I feel some Keeping in mind how he will feel, but how would I go with sharing the profits with him? Because I do want to share the profits not only with him, but my own.

Okay, which is something that I definitely need to work on because that's something that my wife worked on. She and that was my mistake for not looking at the books. She did all that. Yeah, you'll have to learn to run the books, not just run the truck. Right. That's your yeah, that's part of your stage'cause you're back at the treadmill operator stage.

And you know, in in order to make your moves through the stages of business, your your next thing is to delegate and to get proper books set up, proper accounting setup, budgets set up so you know whether what you can pay. how you can pay and what your profits are. Plus that also tells you if you're estimating your jobs proper.

So if you got tickets coming in and you're not even making what the ticket costs you to do, you know, we didn't make back parts in labor even because we didn't estimate the job high enough, then you can reset that. You don't know all of that if you're not doing a set of books and closing the books every time.

So yeah, you got a lot of stuff on your plate that's gonna land there that you're gonna have to get a lot better at really quickly. And so you may wanna jump on entree leadership dot com, get one of our coaches in your corner, help them work you through this. Um as you go along. But, you know, a week from now when you get out of that mediation, you will know where you stand with the existing entity. Do you need to go start your own and then contact the customers to move the contract?

Or is she gonna hand it over to you? It's a pretty simple thing.'Cause she's not gonna run it and she's gonna have nothing. Tell the mediator that,'cause I'm not gonna work there and I'm gonna move all the contracts. So tell the meat eater, she's not gonna get anything. If she you know, all she's gonna do is put this one entity out of business and the next morning I'll be opening a different name. So it's up to her, but it's kind of silly.

And uh you if you've got kids and you got child support, she's gonna want you. profitable so that you can pay the child support. and so forth. So that that's you know, that's where we're looking at so Hey Manny, I'm sorry you're going through that. I can hear the pain in your voice. It's a hard time for you. And um it's confusing and it clouds up everything. You can't get your work done because we don't think about anything else when we're in the middle of stuff like that. I'm sorry.

I love entrepreneurs. Don't forget, guys, I started my company on a card table myself. So I know what it's like to have people counting on you. Your team, your family, not to mention your customers. And when you're the one signing the Paychecks, you can't afford to fly blind. But I'll be honest, early on, one thing that nearly sunk us was wasting time with spreadsheets that didn't add up because business units didn't talk to each other. I finally told my team, just fix it. And they did.

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Inventory issues, cash flow risks, even supplier delays before they become problems. So you can trust the data, stop wasting time, and make the right decisions faster. Take a free product tour today at NetScript. NetSuite.com slash Ramsey. That's NetSweet.com slash Ramsey. Our question of the day comes from Corey in Fort Lauderdale. Dave, I run a small service-based business, and our margins have been tightening lately with rising costs. I want to stay profitable, but I also don't want to cut in

places that hurt my team or our customer experience. When money gets tight, what are the first expenses a business owner should take a hard look at, and what should be off limits?

Actually, I look at it the other way. I don't look at what expenses there are. I I look for revenue opportunities. What other lines of business do I need to add and how do I raise my prices? Because if you're running a service based business and your margins are tightening because costs are going up, that means you did not raise your price. And everybody else in your business raised their prices because they didn't want their margins tightening.

So rising costs generally mean rising prices for the delivery. That's true. So like we're printing a book on the five stages of business, building a business you love. It costs a lot more to print that book now with paper costs than it did ten years ago. If I'd done that book 10 years ago, it would have cost half what it costs now to produce that book. So what do I do? I raise the price on the book.

Hardback books are now thirty two dollars. They used to be twenty two dollars. And before that they were seventeen dollars. And so, but that's based on the cost of the production of the book and the soft costs it takes to develop and put out a book.

service based stuff. So uh same thing. So we raised the price. And so did everybody else by the way. So look on Amazon. Average hard back book in the self improvement space is about thirty two, thirty four dollars. And that's kind of shocking to me'cause I it was twenty two, twenty four, forever.

And before that it was seventeen and before that was twelve. So um, you know, but that's all based on rising costs and so generally you people raise prices when their cost of production, cost of providing the service goes up.

Case in point, a hotel to hire maids and to hire servers in the restaurant and to hire front desk people, it costs them a whole lot more than it did before COVID just five years ago. So guess what? Your hotel room costs a lot more. Tudah. And you know what we call that? Inflation, that's what we call it. That's where it comes from. So Uh and so th this is you know, increased tariffs. Do not cost companies money. Companies rise raise prices equal to tariffs.

And so they pass the tariff cost on to the customer. Increased costs do not cost companies money. They pass it on to the customer in the form of higher prices. That's basic econ. And that's what you're going to need to do first, Corey. Secondly, look at a different way to some other services or other products you can add to your line to create more revenue. And then I don't have to look at what I cut.

What is it I cut? Because you're probably not I run a small service based business. You probably don't have a lot of flow. You probably don't have a lot of overhead that's just miscellaneous stupid stuff. I mean but go through your P and L every month and go, where's every dollar going? Is every dollar an investment? Is every dollar helping us raise the the bar here? Is every dollar what it takes to provide it? Or are we got you know, are we spending

five hundred dollars to put a green plant in the lobby, well I can do away with that maybe, but I mean nobody's ever in the lobby. Hello. So I mean what I don't know, what is it? For something like that, that's fine, but that's usually not What causes success? Most businesses managing expenses and turning them only into investments causes success, but not cutting expenses. You can't cut your way into

Success, usually. There's a few times that comes up that that's possible, but most of the time that's not it. So generally speaking, it's an increase in revenue from prices going up and extra lines being added. and then go through the P and L with a fine tooth comb and see what tang what tangles are in there that you can untangle. But in a small business, I don't run into entrepreneurs that are extremely r wasteful in a small business. The waste comes when things get big.

And it gets bureaucratic and people don't think about what they're spending'cause they think the company's got plenty of money and they just gotta th that's when waste happens. But when you're small and scrappy, most of the team is small and scrappy with the expenses. They're not out of control. 'Cause they know that that means the place stays open that w that hired'em. And that's a that's a big, big deal there. So good question, Corey. We appreciate you joining us from Fort Lauderdale.

Every breakthrough in your business starts with a breakthrough in you. That's why you need to come to Entree Leadership Summit. You'll get insights from top thought leaders in the leadership and business space like Will Gadera, Vanessa Van Edwards. Brian Bafini and more. Visit entre leadership.com. Or click the link.

Well, if you uh like what you're hearing, you can help us out by following the show or subscribing to the show or leaving a nice five-star review. Those one stars are not helpful, you trolls, okay? Sharing it, if you don't like us, just leave. Okay, it's okay. We can handle it. Uh sharing it with a friend, telling people this is a great show, uh send a little uh share button, push all that, all that kind of stuff, click the

Click the uh cut out the uh link and send it to somebody. Go, this is the thing right here, man. Hey, let people know that we're here. You're our best and our only marketing. So let people know that we're here, please. Thank you, thank you, thank you for doing that. If you want to be part of the show, call me at 844-944-24. 1070. That's 844-944-1070. Steve is with us in Denver. Hey, Steve, what's up?

Hi Dave. I'm the owner of a childcare business with sixty employees that does about three million in revenue. As I enter the trailblazer stage of business, other colleagues in my industry tell me to hire virtual assistants to help with operational efficiency and to help me scale faster. My head sees this as an opportunity, but my heart feels unsure because I can't have the same leadership impact with a virtual assistant.

So my question is, am I crazy to value in person leadership impact over operational efficiency when considering a virtual assistant? No. Uh we don't have any virtual assistants at Random. Uh and you're big enough that you don't need one. With sixty people you need your assistant on site.

Um the CEO of an organization that size running three million dollars, you need you need somebody on site. That's um that's what I would do anyway. You're asking me. Now we're not I'm not against virtual assistance as a concept. We actually endorse a company that does that.

and they've supported us for years, we've supported them for years. But there's a time and place for that and it generally is when you're uh at the treadmill stage and you can't you know, you can't afford to have somebody there. You don't have a location even that can hold enough people to

You know, your your fourth employee is usually not a personal assistant, right? That kind of thing. But you got sixty people working there and you're running three million dollars a year. You said three million, right? Yeah, and all of my employees are with the children. They're all on operations. Yeah. Yeah. So I'm doing all the marketing, the finance, HR, all of that. Yeah, you absolutely need somebody in your coin.

And they need to buy be a high level. They don't need to be just a this is not somebody answer the phone and write letters. These people help you with these actual HR issues. H help somebody help you with the marketing issues. They can implement some of the things you're talking about. They're like your right arm, in other words.

rocket fuel. And so um yeah, I I think that's even more reason that they need to be in person personally. Um but you're talking to the guy who doesn't do work from home. Right. We don't have a single person working from all. Um would you start with an executive assistant? I'm sorry?

Would you start with an executive assistant? I would. In person. Yeah. I I would not do a a virtual. And uh for all the reasons you outlined when you opened the call, it's the same thing we believe here. Um Now again, th it th what I'm trying to say though is there's that's not to say just because you don't need one and I don't need one that there's not a place for some

virtual assistants. There are, there is a place for that, but yours is not. I I you definitely need a high quality executive assistant in there. That that understands marketing lingo quickly, understands HR lingo quickly, and they're not a glorified secretary. They are actually helping you run the business. Almost as if they're an assistant manager, so to speak.

That makes sense. Because you got all these plates you're spinning, you're the only one pl spinning the operations side. Uh the actual product delivery is the only thing your employees do. You do all the back office by yourself. Right. That's what you said. So that's why that's why we know you need somebody that can help you do all of that, not just answer your correspondence.

It's not like a nineteen fifties secretary that brings you coffee and types letters. It's not what I'm talking about. You see what I'm saying? Yeah. Yeah, that makes a lot of sense. This is someone that really n has some business acumen and comes in. You're probably gonna pay them a little bit more and they're probably gonna be worth it though.

Because you're probably you probably got enough plate spinning with what you're describing in enough different major areas of the business that you might be dropping some stuff here or there that they pick up and it probably is going to increase your profitability.

Yeah, so what would you look for in an executive assistant? I would like in this case for someone, I'm just th making this up as we're talking. I don't haven't put a lot of thought into it, but I I would almost like someone that had run their own business in the past. Um, you know, uh uh so because uh you know, someone just out of college doesn't have the business acumen to help you with these different elements, right?

And if they've run their own business before, they've dealt with some basic marketing things or they've dealt with some Um maybe they ran a little marketing business that failed. You know? And they're just looking for a place to land that's safe and work for a good guy and and come in and join a thing and take care of kiddos, you know. And that's a good that's a good mission for them of uh to come in and and bring some of their

uh knowledge base to help you do some of these things. Cause I you know, I'm just thinking somebody has a little bit of marketing knowledge, a little bit of uh uh uh HR knowledge, a little bit of, you know, where they can actually kind of be your again, your right arm, not just somebody that fetches coffee.

Yeah, that would sound really nice. And again, I you be willing to pay ten or twenty grand more a year and get the right person because they're gonna take some of this off of you and it's gonna I think it's gonna increase your revenues and decrease your cost. Because you're going to have another set of eyes looking at the operating the entire business. You're the only one looking at the whole thing right now. And if you get this almost it's almost an assistant manager's role.

or uh VP role, if you will. I would not advertise it that way, but that's how I'd be thinking about when I'm interviewing and hiring and and pushing my way through it. That that's how I'd go at it. You're a good man, Steve. It's gonna work out good for you.

Proud to have you in our audience, sir. Very well done. Remember, folks, 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 Entre Leadership.