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0:17

notes From

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the headquarters of Ramsey Solutions, this

0:30

is the Entree Leadership Podcast, where

0:32

I take calls from leaders like

0:34

you about what it takes to

0:36

win at any stage of business

0:39

and leadership. I'm Dave Ramsey, your

0:41

host with over 30 years of

0:43

experience, leading in the trenches right

0:45

alongside folks like you. If you

0:48

want to submit a question, well

0:50

you go to Entree leadership.com/ask, or

0:52

leave us a voicemail at 844-944.

0:55

That's 844-9441770. Jacob

0:57

is with us in

0:59

Idaho. Hi Jacob. Hi

1:01

Dave, thanks for having

1:04

me. Sure. I'm the

1:06

owner, CEO of

1:08

a materials testing

1:11

and inspection firm. Started

1:13

it back in 2016.

1:16

And this year, we

1:18

have just over 20

1:21

employees. and we're on track

1:23

to end up right at $4

1:25

million. Good for you. Well done.

1:28

With the 25% bottom line

1:30

on that, which is awesome.

1:32

Wow, that's amazing. Good

1:34

for you. My question

1:36

is, how do we more accurately

1:39

plan and forecast for

1:41

the upcoming season in

1:43

year? Well, I mean. I

1:46

think it's obvious that

1:48

generally forecasting is based

1:50

on the last few

1:52

years as a trend line,

1:54

right? And so if we go

1:56

back, you know, what did you do

1:59

in 2022? 2021, 2020 might

2:01

be weird, but the, I

2:03

mean, what's your trend line

2:05

on that? And what

2:08

information can you gather

2:10

from that that informs this

2:12

year, right? And so

2:14

we're always doing that.

2:16

And so your, your next

2:18

year is always like the

2:21

year before plus or minus.

2:24

the things that we are given. I

2:26

mean, we know we've got increasing cost,

2:28

or we know we've got this customer

2:30

is going away, or we know we've

2:32

got a new customer coming online that

2:35

we didn't have last year, so we

2:37

can add that to the forecast. But

2:39

you take last year's your baseline, and

2:41

then whatever differences there are, we add

2:43

and subtract those to try to come

2:46

up with this coming year. And the

2:48

longer you've been in business, the

2:50

more accurate... You'll be able to

2:52

forecast the longer you've had that

2:54

product line Or that service you're

2:57

the more accurate you'll be able

2:59

to forecast the first year you're

3:01

doing it your forecast is a

3:03

guess It's not even an estimate. It's just

3:05

a guess You know, it's based on

3:08

numbers, but it's I guess we're going

3:10

to sell this many units for this

3:12

much revenue and I guess we're

3:14

going to have these expenses and

3:16

but you're you're forecasting your first

3:19

two years as usually Should be

3:21

the most inaccurate of your

3:23

entire business career after that

3:25

it should get better and

3:27

better and better, but you're

3:29

probably already doing all of those

3:32

things aren't you? Yes, but my my

3:34

issue comes up of so last year

3:36

we did 1.6. Whoa and then we

3:39

jumped. Yeah. So what caused it to

3:41

more than double? Well, that's kind of

3:43

the part of my issue is

3:45

that we are you know, so working

3:47

in construction right where I say

3:50

that we're akin to a trade,

3:52

but we work more on the

3:54

engineering side. Yeah. But, but I have,

3:56

we're the last thought on whether

3:58

it's a contract. or hiring us

4:00

or an owner-developer, we're the last spot.

4:03

Like I've had times they're breaking ground

4:05

and then they call us, hey, we've

4:07

got this project for you. And it

4:10

turns into much bigger than we ever

4:12

anticipated. But I've also contacted some of

4:14

our larger clients that are, you know,

4:16

year after year, and I'm like, hey,

4:19

what do you have coming up? And

4:21

there's crickets because of their internal lack

4:23

of communication. And so that's where I'm

4:26

just trying to get better ideas of

4:28

how to how to communicate with with

4:30

some of these clients of ours of

4:33

so that we can not a four

4:35

million dollars how many clients are you

4:37

running oh 60 to 80 a month

4:39

we had the month where we were

4:42

on a hundred different projects well that's

4:44

a pipeline that's not that should that

4:46

you ought to be able to say

4:49

okay what did I do to get

4:51

60 in the pipeline versus 30 in

4:53

the pipeline? That's

4:56

not that's not based on their

4:58

whim. You've done something That's caused

5:00

you to get 30 in the

5:02

I mean two years ago you

5:04

had 30 and now you got

5:06

60 right? Yeah, if it was

5:08

three I could see the volatility

5:10

Because it was just you know,

5:12

it's on their whim and crap.

5:14

I don't know what that one's

5:16

gonna do and that's one-third of

5:18

the forecast right that that that

5:20

makes it inaccurate. It's very difficult

5:22

to put in to paper to

5:24

paper on that one, but where

5:26

you're going from 30 to 60

5:28

or 30 to 70 You're doing

5:31

something there. That's different projects, different

5:33

customers, right? Some of it is,

5:35

yes. And honestly, we don't do

5:37

any advertising. It's all word of

5:39

mouth, you know, and, which is

5:41

amazing. And it does speak, and

5:43

I do understand that speaks of

5:45

volume. How wide is your geography

5:47

footprint? How far out are you

5:49

going from Pocatello? Well, we'll travel

5:51

about two hours in any direction.

5:53

Sometimes more just depending. Okay, what's

5:55

the what's this market cap out

5:57

at for you? Oh That I

5:59

don't know because right now we've

6:01

got a lot of heavy highway

6:03

projects from the infrastructure bill that

6:05

are happening and will continue for

6:08

the next couple of years. But

6:10

we've had just a lot of

6:12

developers in development here in East

6:14

Idaho happening and you know I

6:16

know some of my competition in

6:18

the area we've now kind of

6:20

exceeded some of their offices but

6:22

I also think they're probably at

6:24

the six to eight million dollar

6:26

range. So you

6:28

the idea that you could you

6:30

know you've been taking some of

6:32

their business here and there You

6:34

would end up taking more of

6:36

it Then there's plenty of market

6:38

cap. I mean you could take

6:40

this to 20 million hypothetical and

6:42

not ever leave your your geographical

6:44

footprint, right? I Wouldn't say quite

6:46

that much, but there can be

6:48

you know, we could probably three

6:50

to four X what we're at

6:52

now with additional four will be

6:54

16. Yeah, yeah, yeah All right,

6:57

that makes sense. Well, I think

6:59

what we've got to determine is

7:01

where the customer base is coming

7:03

from and can we predict that

7:05

that is replicatable? Can I continue

7:07

that? Or am I just? Totally

7:09

Totally going to be guessing for

7:11

the rest of my life. I

7:13

don't like guessing that scares me.

7:15

That's not forecasting So but but

7:17

basically we've got to say this

7:19

revenue stream What have we got

7:21

to do to feel good? That

7:23

when we say five it's going

7:25

to be five and That represents

7:27

a hundred clients a month and

7:29

we know what it takes to

7:31

get a client in a pipeline

7:33

And we've got to do, we've

7:35

got a staff to make sure

7:37

that that happens and we've got

7:39

to put resources and technology and

7:41

marketing dollars or whatever to make

7:43

sure that that happens. I think

7:45

you've got to get under the

7:47

hood here and not just say,

7:49

okay, these clients are just generally,

7:51

you know, they're just walking in,

7:53

they're staggering in and dying in

7:55

our lobby. We didn't kill anything.

7:57

No, you need to go, you

7:59

need to figure out how this

8:01

is occurring so that it's predictable,

8:03

replicable, sustainable. And then you've got

8:05

a forecastable model, but where you

8:07

don't have the sense that you're

8:09

controlling or contributing to the creation

8:12

of a client directly. then it

8:14

makes it very very hard to

8:16

forecast and very hard to do

8:18

that. So I think you need

8:20

to get out of the hood

8:22

and figure out where these clients

8:24

are coming from and then that'll

8:26

help you lay your revenue model

8:28

out. And of course you can

8:30

back into expenses after you lay

8:32

your revenue model out. But I

8:34

think you're doing something more than

8:36

you realize you're doing. That the

8:38

organization is doing something to put

8:40

these things in HAP. Maybe you

8:42

need to go back and survey.

8:44

a couple hundred of these people

8:46

and say, okay, how did you

8:48

choose us? What was the process?

8:50

How long is the pipeline? Where

8:52

did you hear about us? What

8:54

was the brand differentiation? What was

8:56

the value proposition? Why did you

8:58

choose us in other words? And

9:00

how did you hear about us?

9:02

And then, you know, you start

9:04

to put together a marketing plan

9:06

based on that because then your

9:08

customer starts to have a persona.

9:10

They start to be that our

9:12

general customer comes to us this

9:14

way, it takes five months to

9:16

develop them from initial contact, and

9:18

then I've got a predictable environment

9:20

that I can create a forecast

9:22

out of. And, you know, that's

9:25

going to be the route I

9:27

go if I'm in your situation.

9:29

You just got to get out

9:31

of the hood and figure out

9:33

where the money's coming from and

9:35

create a predictable model. and then

9:37

you can forecast accurately. But it's,

9:39

and it's worth doing because it's

9:41

going to drive you nuts otherwise.

9:43

You're going to feel like you're

9:45

at the whim of the wind

9:47

blowing and that'll drive you bananas.

9:49

This is the entree leadership podcast.

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10:56

Have you given up on the

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or click the link in the

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description if you're listening on YouTube

12:08

or podcast. Jen is in Canada.

12:10

Hey Jen, welcome to entree leadership

12:13

podcast. What's up. Well, that sounds

12:15

like what I need because I'm

12:17

looking at my business and going,

12:19

should I stick with it or

12:21

should I let it float over

12:23

here at the side and I

12:26

go back to my day job?

12:28

That's where I'm currently at. I

12:30

left my career of 20 years

12:32

where I was always very successful

12:34

and turned my side hustle, got

12:37

so big that it became my

12:39

full-time job. And now I've since

12:41

taken it out of my basement.

12:43

I've got a bricks and mortar

12:45

location, we're doing about $870,000 worth

12:47

of sales a year, but I'm

12:50

still not paying myself since getting

12:52

the bricks and mortar location. And

12:54

I have an opportunity to go

12:56

back to work in my previous

12:58

field, you know, make a hundred

13:00

grand again and get back to

13:03

earning for my family instead of

13:05

now having what feels like my

13:07

business just drain me. you know

13:09

when I'm staring at the debt

13:11

that the business has and staring

13:14

at you know all the expenses

13:16

of having this overhead now and

13:18

just thinking like every to every

13:20

payroll I go oh well I

13:22

pay myself no no no no

13:24

don't do it this week how

13:27

much debt did you take on

13:29

for this well we have the

13:31

we bought the building so we've

13:33

got the mortgage on the building

13:35

and then we've got some renovations

13:38

that we had to do and

13:40

some startup inventory costs so I

13:42

would say we probably owe 450

13:44

What's the building worth? I'd say

13:46

probably we paid three. 90 for

13:48

the building and the place next

13:51

door just sold in the sixes

13:53

so I'm confident that if we

13:55

sold it right now we get

13:57

at least probably 550 for it

13:59

so I think the building is

14:02

an investment I guess but that

14:04

doesn't help the mortgage payment every

14:06

month. So if you didn't have

14:08

the building your business would be

14:10

profitable? I think our expenses every

14:12

month are about $20,000. That's payroll

14:15

and rent if you didn't have

14:17

the if you didn't have the

14:19

more. That's it. I think it

14:21

would be a wash. I honestly

14:23

think that the mortgage every month

14:26

isn't what's bringing us down. I

14:28

think that like overall, sales are

14:30

kind of tight or tighter than

14:32

when we first like 875 is

14:34

what we did last year. I

14:36

would say we're down to 550.

14:39

We're on track to big 550

14:41

this year. And I think that's

14:43

just, I think that's like economy

14:45

and people doing just shopping less.

14:47

That's what I'm seeing. I don't

14:50

see us doing a whole lot

14:52

different. We used to do a

14:54

lot, a lot, a lot of

14:56

online courses and now everybody wants

14:58

to come in person. So COVID

15:00

was great for us doing online.

15:03

So we had a lot of

15:05

online revenue. And now people are

15:07

like, well, we'd rather come in

15:09

person. And well, you can only

15:11

fit 10 people in a classroom

15:13

where you could do the course

15:16

before for 100 people. And so

15:18

we try to now do online

15:20

and in person, but people want

15:22

in person. And you just can't,

15:24

you just can't do as many,

15:27

it seems. So my question really

15:29

is, if I'm trying to adhere

15:31

to the baby steps at home,

15:33

which I am, but I'm never

15:35

bringing in any income, should I

15:37

allow my business. to run as

15:40

is no without me here every

15:42

day making money that i trust

15:44

it's not making money there's no

15:46

point in key it. I'll just

15:48

shut it down, sell the building.

15:51

Or you've got to see a

15:53

way to make it profitable, one

15:55

of the two. If you can

15:57

figure a business model that gives

15:59

you hope, a business model shift,

16:01

a pricing shift, a delivery of

16:04

product shift, whatever it is, the

16:06

way you're doing the classroom thing,

16:08

to where you actually are making

16:10

a profit. and you are paying

16:12

yourself and you can see your

16:15

way to that. If I try

16:17

these three things and they don't

16:19

work, then I don't know what

16:21

to do, then I need to

16:23

close it. If you've tried everything

16:25

and you don't know what to

16:28

do and you're just waiting on

16:30

lightning to strike, then it's time

16:32

to close it. You close something,

16:34

you end a relationship, you end

16:36

a business, you end a job,

16:39

you bring an ending to something

16:41

when you lose hope that it's

16:43

going to get any better. it

16:45

making enough to pay the employees.

16:47

No thank you. Not enough to

16:49

pay me too. No thank you.

16:52

It's not a hobby, it's a

16:54

business. It's not your job to

16:56

do only create jobs. It's wonderful

16:58

that you create jobs and that's

17:00

a that's a cool thing. But

17:02

you're supposed to be making money

17:05

owning a business. That's the point.

17:07

It's not a hobby. And so

17:09

you need to have a way

17:11

to get this profitable or you

17:13

need to close it and sell

17:16

the building and get out of

17:18

the debt. And I don't know

17:20

which one. I don't hear the

17:22

idea of floating in our conversation

17:24

that saves this, but it may

17:26

be there. I just don't know

17:29

what it is. And so I

17:31

don't know what the idea is

17:33

either. I think I would sit

17:35

and spend some time in prayer,

17:37

spend some time maybe even with

17:40

your leadership team, if you're married

17:42

with your husband and talking about

17:44

this and saying, okay, before we

17:46

close it, is there anything else

17:48

we want to try. And

17:51

if we try those things and

17:53

we can't get it profitable, we

17:55

don't see a way to scale

17:57

this. We don't see a way

18:00

to break this log jam. than

18:02

me working for free, me owning

18:04

a business and being $450,000 in

18:06

debt to make zero money is

18:08

a bad idea. Yeah. That needs

18:11

to go away. And the great

18:13

news is it can go away

18:15

and you can clear the debt

18:17

and maybe put a little money

18:19

in your pocket and start restart

18:22

your career. But I'm going to

18:24

try to figure out a way

18:26

to deliver this service in a

18:28

way that I can get enough

18:30

scale to it at enough price

18:33

that it makes me money. You

18:35

know, if the people want to

18:37

come in, there's only room for

18:39

10, then maybe your pricing is

18:41

too low per unit. If we

18:44

raise prices, we have the same

18:46

number of customers. I don't know.

18:48

I'm amazed at what people will

18:50

pay for small group engagement situations

18:52

versus being in an online setting.

18:54

And for the personal attention of...

18:57

It's almost like having a personal

18:59

one-on-one coach because there's only 10

19:01

people in the room. You know,

19:03

and so I'm amazed at that

19:05

price point and what it will

19:08

do in some areas. It might

19:10

not do in your area. It

19:12

might be the area of business

19:14

you're in, what you're teaching, or

19:16

how you're doing it. It might

19:19

not work for you. But so

19:21

I'm going to give myself, you've

19:23

got a lot invested in this

19:25

emotionally, financially, financially, and everything else.

19:27

So I'm not going to close

19:30

it today. I'm going to give

19:32

myself 30, 45 days to come

19:34

up with an idea, or maybe

19:36

to try a couple things. And,

19:38

you know, once I have exhausted

19:41

all reasonable possibilities, and then the

19:43

conclusion is that I'm going to

19:45

stay $450,000 in debt to break

19:47

even. And no, no, thank you.

19:49

And make no, you know, no,

19:52

I'll just close it, sell the

19:54

building and go get a job.

19:56

And you'll make a lot more

19:58

for your family, a lot more

20:00

for your family in that whole

20:03

process. And that's exactly the, you

20:05

know, the route I would go

20:07

with that. Wow. I feel for

20:09

you. I wish I had the

20:11

perfect thing I could just throw

20:13

at you and go, just do

20:16

that. But I don't understand enough

20:18

of what you're doing to throw

20:20

that at you. I'm sorry. This

20:22

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first year. That's T-R-A-I-N-U-A-L-S-L-S-S-A-S-A-L-S-S-L-S-S-L-S-S-S-S-S-S-S-A-A-S-A-A-A-S-A-S-A-A-A-S-A-A-S-A-S-S-S-S-S-A-S-S-S-S-S-S-S-S-S-S-S-S-S-S-S-S-S-S-S I'm Dave

21:30

Ramsey your host. This is the

21:32

Entree Leadership Podcast. One thing I

21:35

am sure of as a leader

21:37

that when you have a team

21:39

that is not unified, not all

21:41

dancing to the same sheet of

21:43

music, not all aligned and heading

21:46

in the same direction, it is

21:48

almost impossible to create a productive

21:50

profitable environment that people love working

21:52

in and that the customer loves

21:54

doing business with. And

21:56

yet very few teams are

21:59

actually unified. People get away

22:01

with it all the time.

22:03

They seem to outear their

22:05

stupidity on this subject. It's

22:07

crazy. And I have looked

22:09

at the unity and studied

22:11

the power of unity for

22:13

a very long time. The

22:15

power of synergy, the power

22:17

of when three people are

22:19

agreed on something, when five

22:21

or more are agreed on

22:23

something, and we're all aimed

22:25

at that direction, and we're

22:27

all pulling out all the

22:29

emotional and spiritual stops to

22:31

cause it to happen. It's

22:33

amazing. what you can pull

22:35

off with a team is

22:37

doing that. And I really

22:39

don't know after 30 years

22:41

of doing this what creates

22:43

unity. But what I do

22:45

know, and what I recognized

22:47

a long time ago, is

22:49

what destroys unity. And one

22:52

of the things we teach

22:54

in entree leadership are the

22:56

five enemies of team unity.

22:58

And what I have discovered

23:00

at Ramsey, and many of

23:02

you have discovered after I

23:04

taught it to you that

23:06

when you fight back with

23:08

everything that's within you against

23:10

the five enemies of unity,

23:12

when the enemies of unity

23:14

are all put outside the

23:16

walls of your building, then

23:18

unity will occur. But these

23:20

things will, they're poison, they're

23:22

acid in the system, and

23:24

as long as it's in

23:26

the system, you're gonna struggle.

23:28

The first of the five

23:30

enemies of unity is poor

23:32

communication. When the right hand

23:34

doesn't know what the left

23:36

hand is doing, you can

23:38

be guaranteed somebody's pissed off.

23:40

It frustrates things. It's hard

23:42

to move forward. And when

23:45

people don't know what's going

23:47

on, they will write a

23:49

script in their head, or

23:51

with their mouth, that makes

23:53

the situation much worse than

23:55

it really is. So communicate

23:57

communicate communicate over communicate over

23:59

Share. Share your story with

24:01

your team, collect weekly reports

24:03

from your team so you

24:05

know what's going on with

24:07

your team. You know, push,

24:09

push, push, push, push, push,

24:11

push, push through all of

24:13

these things. Absolutely vital. Keep

24:15

talking, keep talking, keep pushing.

24:17

Have staff meetings, have anything

24:19

you can do to create

24:21

wonderful communication. It's absolutely necessary.

24:23

Have something like a vision

24:25

statement, have something like a

24:27

mission statement. This is who

24:29

we are. When we're not

24:31

doing this, we're not a

24:33

we. This is who we

24:36

are. Communicate, communicate, communicate, communicate.

24:38

If things are going bad,

24:40

tell the truth. Tell people

24:42

what's going on. Now don't

24:44

make them worse. Don't be

24:46

super negative than any about

24:48

it. Don't be Debbie Downer,

24:50

but tell them, we're not

24:52

profitable this month because we

24:54

have this problem. You know

24:56

when things are going great

24:58

tell people tell them what's

25:00

going on tell them about

25:02

the future tell them what

25:04

you believe? About good about

25:06

what's going to happen and

25:08

what's happening. You know where

25:10

we're going from here communicate

25:12

communicate communicate communicate George Bernard

25:14

shall said the biggest illusion

25:16

of communication is that it

25:18

has actually occurred And

25:21

Andy Stanley used to say, you

25:23

have to tell people something 21

25:26

times before they hear it. Talk

25:28

about everything over until you're sick

25:30

of it, over and over and

25:33

over and over again. The second

25:35

enemy of unity is gossip. We

25:38

have a core value at Ramsey

25:40

that we have zero tolerance for

25:42

gossip. It's not actually true. We

25:45

actually will have a little tolerance.

25:47

We'll warn you one time before

25:50

we fire you. Hand your negatives

25:52

up. You're going to have negatives

25:54

if you weren't here pushing things

25:57

if you weren't here moving things

25:59

around if you weren't if there

26:02

wasn't you probably wouldn't have a

26:04

job, so expect problems. Expect frustrations.

26:06

Expect speed bumps. And when you

26:09

have a problem, not if you

26:11

have a problem, hand your negatives

26:14

up to someone in leadership that

26:16

can do something about it. Don't

26:18

spread your negatives all around. If

26:21

you hand your negatives down or

26:23

spread them around, we will warn

26:26

you one time. And

26:28

then we will say, you know,

26:30

you can't gossip and be here.

26:32

And you can't talk negatively about

26:35

other people. You can't do anything.

26:37

You can talk to leadership about

26:39

anything. You can vent there. You

26:42

can't be belligerent. But you know,

26:44

you can bring in a concern.

26:46

You can talk about this situation

26:49

with this person. You can this

26:51

relationship breakdown. Anything you want to

26:53

do. And so we're going to

26:56

fire you if you gossip at

26:58

Ramsey. And by the way, if

27:00

you were to take a poll

27:03

or a survey, which we have

27:05

done, of the people at Ramsey,

27:07

it is one of their favorite

27:10

reasons for working here. They work

27:12

in a non-gossipping environment, because gossip

27:14

destroys the environment. And the worst

27:17

form of gossip, in my mind,

27:19

is where you're running the company

27:21

down. You're running the leadership down.

27:24

And my friend Henry Cloud says,

27:26

I don't understand people pee in

27:28

their own cereal and then gripe

27:31

because it tastes bad. You work

27:33

there. This is where your money

27:35

that feeds your family comes from.

27:37

Your children, you know, have food

27:39

because of this place. And then

27:42

you are tearing down the place.

27:44

What kind of moron are you?

27:46

I might not even warn you

27:48

once for that one. I might

27:50

just fire you for that one,

27:53

because that's not only gossip, but

27:55

disloyalty. And it's a lack of

27:57

integrity. But you know depending on

27:59

the situation and how extreme and

28:01

so forth we're there, but you

28:04

know Well, I hate this or

28:06

I hate that or whatever. That's

28:08

fine. Talk to leadership about it

28:10

in a non belligerent way and

28:12

you're safe to do that here.

28:15

But we have a zero gossip

28:17

policy at Ramsey. That simple. The

28:19

third enemy of unity is unresolved

28:21

disagreements. Where you have a disagreement

28:23

with someone, someone has two people

28:26

on your team have a disagreement.

28:28

and they do not come to

28:30

closure healthy conflict, mental health closure

28:32

on that disagreement. It just boils

28:34

in festers inside and becomes a

28:37

splinter in the organization and eventually

28:39

infects everything because it will spill

28:41

out of their mouth as gossip

28:43

eventually. It will spill out of

28:45

their mouth as some kind of

28:48

negative situation. teach the idea that

28:50

good organizations, my friend Patlin Cheney

28:52

talks about this, the best organizations

28:54

to learn how to do conflict

28:56

well. It's mental health, it's organizational

28:59

mental health to learn how to

29:01

do conflict well. We do a

29:03

lot of conflict at Ramsey, but

29:05

we're not destroying the human beings

29:07

that are involved. We're destroying bad

29:10

ideas. We argue about which play

29:12

to call to win the Super

29:14

Bowl. We do not argue. about

29:16

whether so and so is capable

29:18

or not. If that's a different

29:21

discussion and that's not a, that's

29:23

not an argument, that's deciding whether

29:25

somebody can stay or not based

29:27

on competency. But this idea that

29:30

you can just, everybody can disagree,

29:32

everybody can not like each other,

29:34

everybody can disrespect the value system

29:36

of the other person and still

29:38

have productivity and still have unity

29:41

is crazy. So you got to

29:43

have difficult conversations. You've got to

29:45

bring stuff out. You got to

29:47

talk about it I had one

29:49

person coming to my office and

29:52

say well, I needed tell you

29:54

this about so and so, but

29:56

you can't tell them where it

29:58

came from. You don't need to

30:00

tell me anything then. If you

30:03

can't stand behind your words, then

30:05

you don't need to come in

30:07

my office and tell me something.

30:09

You're just whining. So if you

30:11

don't feel strongly enough that this

30:14

matters to the good for the

30:16

good of the person you're talking

30:18

about, the good of the company,

30:20

the good of the organization, that

30:22

you can stand by your own

30:25

words, then you don't need to

30:27

utter those words. That's cowardly. That's

30:29

cowardly. Because I've

30:31

got to go deal with it

30:33

once you tell me and I'm

30:35

not going to go deal with

30:38

it with an anonymous source How

30:40

cowardly is that? Anonymous source came

30:42

to me and told me that

30:44

you were doing a bull What

30:46

a wuss? So you know, don't

30:48

come in my office and tell

30:50

me that you were doing a

30:53

bull What a wuss? So you

30:55

know, don't come in my office

30:57

and tell me that just say

30:59

hey got a problem with so

31:01

and so I heard so and

31:03

so I don't know how to

31:06

talk to him about that you

31:08

back in here And we all

31:10

may all sit here and talk

31:12

about it, but we're going to

31:14

have a resolved conflict, not an

31:16

unresolved disagreement when we finish, 100%

31:19

of the time. At another lady

31:21

came in and she said, well,

31:23

I've got to talk to you

31:25

about my leader, they're incompetent this

31:27

way, and I said, yeah, I

31:29

understand. And I appreciate you bringing

31:32

that to me, and actually a

31:34

couple of points you brought up

31:36

are right, and we're working with

31:38

your leader on that. And you

31:40

know, no one in the building

31:42

is perfect, but we're working with

31:45

them. Thank you for bringing it

31:47

to me. I appreciate that and

31:49

know that this is a project

31:51

that's underway. Well, three weeks later,

31:53

she's in my office with the

31:55

exact same issues. And I'm like,

31:58

I told you we're working on

32:00

this. And she's like, well, it's

32:02

still there. It's... This is a

32:04

process where we don't shoot our

32:06

one. And we worked with folks

32:08

and bring them back to wholeness

32:11

and move on to the next

32:13

thing. And three weeks later, she'd

32:15

back in my office again. And

32:17

I said, look, now you're not

32:19

questioning that person's competence. Now you're

32:21

questioning my competence. Bringing the same

32:24

thing in here three times after

32:26

I've explained it to you is.

32:28

Now you're saying I'm not competent

32:30

because I haven't fixed it at

32:32

the speed at which you think

32:34

it should be fixed. So now

32:36

you and I are starting to

32:39

have a problem. Because you can't

32:41

think I'm incompetent and work here.

32:43

That won't be okay. I'm the

32:45

owner. And she ended up leaving.

32:47

So which is okay. It's perfect.

32:49

That was a resolved disagreement. The

32:52

fourth one is lack of shared

32:54

purpose. The team needs to know

32:56

what your desired future is. We

32:58

help you with that in entree

33:00

leadership. The team needs to know

33:02

what your defining objectives are. We

33:05

help you with that in entree

33:07

leadership. We work you through all

33:09

of these processes. The team needs

33:11

to know what's going on and

33:13

be aligned. And this is where

33:15

we're going to get there. These

33:18

are the processes. This is what

33:20

winning looks like. This is what

33:22

the end of the year. We

33:24

need this many numbers on this

33:26

revenue, on this sales units, whatever

33:28

it is, and we're all aligned

33:31

on that. We have a shared

33:33

purpose. We're not running in 14

33:35

different directions. If you run in

33:37

14 different directions, all you do

33:39

is destroy the wagon. You don't

33:41

pull the wagon. You just tear

33:44

it apart. So we have to

33:46

pull the wagon up the hill

33:48

and we have to be walking

33:50

in the same direction And aligned

33:52

in our steps and in our

33:54

processes and that comes from communication

33:57

And that comes from having a

33:59

shared purpose and then aligning everyone

34:01

to it So when the right

34:03

end doesn't know what the left

34:05

hand is doing because they don't

34:07

know what they're doing because nobody

34:10

knows what they're doing there's not

34:12

a shared purpose. You can't win.

34:14

If we can all agree that

34:16

we're trying to score a touchdown

34:18

and what a touchdown looks like,

34:20

there's a line over there when

34:22

you get the football across that

34:25

line, then the only thing we've

34:27

got to fight through is what

34:29

the most efficient way to get

34:31

that ball across that line is.

34:33

That we have a shared purpose.

34:35

It's a clear goal that we're

34:38

all aligned to. And then the

34:40

fifth. enemy of unity is sanctioned

34:42

incompetence. This comes from a friend

34:44

John Maxwell. And it's a really

34:46

nice phrase, sanctioned incompetence. What it

34:48

means is when you are a

34:51

weak leader and you allow people

34:53

to continually not do their work

34:55

for whatever reason, you give everyone

34:57

else permission to not do their

34:59

work. and to not be unified

35:01

because they don't have respect for

35:04

that person that's not doing their

35:06

work and they don't have respect

35:08

for you as a leader because

35:10

you're weak. You're not willing to

35:12

step into the conflict and require

35:14

excellence of the team. And when

35:17

you're not willing to do that,

35:19

when you're willing to go along

35:21

to get along, well, so and

35:23

so gets a pass because they're

35:25

a friend. You're screwed that you're

35:27

not going to have team unity

35:30

around that. Team unity comes when

35:32

we expect excellence of ourselves. and

35:34

of everyone around us consistently all

35:36

the time. The only exception of

35:38

that is if someone's going through

35:40

a hard personal time, their child

35:43

is ill. Well, they're not going

35:45

to be excellent when their child

35:47

is ill. And you're giving that

35:49

person grace. And someone comes to

35:51

you and says, well, you know,

35:53

someone says not pulling their weight.

35:56

Yeah, I know. But they've got

35:58

a personal issue at home and

36:00

we're giving them some grace. So

36:02

we've all got a cover for

36:04

them. Right now until they and

36:06

then when they get past this

36:08

thing then they'll be back in

36:11

the back in the harness again

36:13

with us But right now we're

36:15

picking up their slack That's not

36:17

sanctioned incompetence. That's great Sanction and

36:19

competence is when I'm too weak-need

36:21

to wussified to face the person

36:24

that's not doing their job and

36:26

call them out in a kind

36:28

way in a very clear way

36:30

and have the uncomfortable conversations to

36:32

say you have got to get

36:34

aligned to excellence again or you're

36:37

not going to be here. And

36:39

that's a process too. So those

36:41

are the five enemies of unity.

36:43

When you toss them over the

36:45

wall outside your organization, well then

36:47

you're going to start to see

36:50

unity occur. When you've got good

36:52

communication instead of poor communication, when

36:54

you've got no gossip, when there

36:56

aren't unresolved disagreements, when we learn

36:58

how to do conflict well. and

37:00

come to a good mental health

37:03

organizationally. We have a very clear

37:05

shared purpose. And when the leadership

37:07

is not wussified and they are

37:09

actually addressing incompetence for whatever reason,

37:11

other than a grace pass on

37:13

something, when you do those five

37:16

things, you're gonna see the whole

37:18

air change inside your organization. That's

37:20

how it works. The five enemies

37:22

of unity must be. removed. Organizations

37:24

are never limited by their opportunity.

37:26

They're only limited by their leader,

37:29

which is why it's so important

37:31

to invest in your leadership through

37:33

life-changing experiences like on-tray leadership summit.

37:35

You'll be poured into by top

37:37

leadership experts so you can catapult

37:39

your business forward in 2025. To

37:42

join us in Denver, Colorado, May

37:44

18th through 21, go to entree

37:46

leadership.com/summit or click the link in

37:48

the description if you're listening on

37:50

YouTube or podcast. I'm Dave Ramsey,

37:52

your host. This is the entree

37:54

leadership podcast. Thank you for joining

37:57

us. We could use your help

37:59

if you will follow this show.

38:01

Click the follow button, the subscribe

38:03

button. It helps us a bunch.

38:05

Leave a nice five-star review and

38:07

share the show. Share the link

38:10

with someone or click the share

38:12

button however it is your particular

38:14

platform allows you to do that.

38:16

It's a big help to us. And

38:18

we need it, please. It has made a

38:20

lot of difference in the numbers since I

38:23

came on the air with this a couple

38:25

years ago. taking over this

38:27

whole podcast that we've had a long

38:29

time and took it to this caller

38:31

driven format. The numbers have gone way

38:34

up, but they didn't go up because

38:36

of me. They went up because you

38:38

guys told people about it. Thank

38:40

you for doing that. David is

38:42

with us in Virginia. Hi David,

38:44

welcome to the entree podcast. Hey Dave

38:47

is an honor to talk to you. A

38:49

long time listener, first time caller.

38:51

Thank you. How can we help? I am an

38:54

owner of a deck building company.

38:56

We did about 1.4 million

38:58

this year and we have

39:00

about 12 members on our

39:03

team We went to some of

39:05

this year got all hooked

39:07

up with a coach and

39:10

advisory group and we've been

39:12

killing it this year

39:14

Question I have for you

39:16

is I want to keep

39:18

growing, but I'm I'm

39:21

struggling with feeling the

39:23

burnout of having so

39:25

much stress of having so

39:27

many people on the team

39:29

now. I know it's just

39:32

12, but it's 12 families

39:34

that we're close with and

39:36

there depend on our company

39:38

for their livelihood.

39:41

So how do I weigh wind

39:43

is growing enough and how

39:45

much do we keep growing?

39:47

What's the stress from?

39:51

Well, we are. How

39:54

is the team causing

39:56

you stress? Right.

39:59

We. there I've become the

40:01

chief accountability officer

40:03

and that's not

40:06

exactly my strength

40:08

accountability for what for their

40:11

KRA's they're hitting

40:13

their numbers profitability

40:15

training and it's we we

40:17

hired up a lot of guys this

40:19

year and then we had to let

40:22

some go and now I think we're

40:24

in a good place now but it's

40:26

still we got a very

40:28

young team. What's the stress

40:31

again? Where's the stress coming

40:33

from? Really, it's the payroll

40:36

every couple weeks. You know,

40:38

it's a heavy payroll every

40:40

two weeks. Are you

40:42

not profitable? It's tight. We're

40:45

getting, I think the last

40:47

three months, we've really

40:49

got to the, got to a

40:51

good place. Have you hired too

40:54

many people or did you

40:56

lose jobs? Why would you?

40:58

I mean at a given payroll

41:00

at 1.4 million with 12

41:02

people you should be

41:04

profitable. Yeah over the summer

41:07

we hired too many and

41:09

then we let some people

41:11

go in the last three

41:13

months and we actually

41:15

saw our revenue increase and

41:18

so it's kind of

41:20

like relieving pressure on

41:22

like lower performing jobs

41:24

taking too long callbacks.

41:27

What I think I'm hearing is

41:29

that the size of the team

41:31

is not stressing you. The

41:34

payroll is not stressing

41:36

you. Underperforming team

41:38

members and underperforming

41:41

jobs that you went through

41:43

as a learning experience

41:45

in the last 12 months

41:47

brought you stress, but it's

41:49

not the 12 people that

41:51

are there now, and it's

41:53

not the revenue that's there

41:56

now. That's all running fine,

41:58

I think. Right, right.

42:00

So I'm looking at if I

42:03

want to keep growing, doing that

42:05

again next year is overwhelming. Why

42:07

would you do it the same?

42:09

What you've got today is working,

42:12

right? Right, right. If you had

42:14

double the number of people that

42:16

you have today and they were

42:18

all the same quality of the

42:21

people you have today, and you

42:23

had... 3 million in revenue. There's

42:25

no downside to that. There's no

42:27

stress to that. The stress came

42:30

from the underperforming projects and the

42:32

underperforming people, not the fact that

42:34

you merely had payroll. Right. My

42:36

point is you're assigning in your

42:39

brain this stress or burnout or

42:41

uncomfortable feeling to the wrong thing.

42:43

You've assigned it to team size

42:45

and to revenue size or payroll

42:48

size and that wasn't what was

42:50

causing you stress. What you told

42:52

me was causing you stress was

42:54

crappy people and crappy jobs. Right.

42:57

And if you keep doing the

42:59

same crappy people and crappy jobs

43:01

over and over, well, you would

43:03

deserve the stress. But that's not

43:06

a reason to downsize. You wouldn't

43:08

do that. That'd be silly. Right.

43:10

So why is it you would

43:12

think that I have a thousand

43:15

people and I'm not stressed? Awesome

43:17

team members. Uh-huh. Why else? They're

43:19

great at what they do and

43:21

they... Plenty of revenue to pay

43:24

them. Right, right. We don't hire

43:26

more people than we have revenue.

43:28

Now, the stress that I do

43:31

have, you know, can come from

43:33

the exact same places you had

43:35

last year. It can come when

43:37

crappy people get in the building

43:40

and removing crappy people's a stressful

43:42

process. Right? Removing the donkeys because

43:44

I accidentally hired one. Or we

43:46

accidentally hired one wouldn't be me.

43:49

But we accidentally hired a donkey

43:51

instead of a thoroughbred, which is

43:53

what happened to you. Or we

43:55

have a business unit that is

43:58

not performing and the revenue starts

44:00

getting tight and always the biggest

44:02

line item in a business unit,

44:04

the expense-wise is going to be

44:07

payroll, just like you have. You

44:09

know, when things are screwed up,

44:11

it's the screwed up stuff that

44:13

causes stress. It's not the scale.

44:16

That's my point. Right, right. And

44:18

that's manageable. because I can do

44:20

something about the screwed up stuff

44:22

and okay, find out why Crazy

44:25

got in the building and close

44:27

that door. Crazy can't use that

44:29

door anymore. And so we, you

44:31

know, we add an element to

44:34

the interview process to keep the

44:36

nut burgers out of the building

44:38

or at least attempt to, right?

44:40

Right, right. And because I got

44:43

to tell you, man, you got

44:45

12 people, one or two bad

44:47

ones out of 12 people can

44:49

screw up the whole, I mean,

44:52

it just takes all the fun

44:54

out of the fun out of

44:56

the business. Yeah, yeah, we because

44:58

they take up all your they

45:01

burn all your calories and they're

45:03

10% of your people and they

45:05

burn all your calories because they're

45:08

doefices and It's just a pain,

45:10

you know, that's the reality It's

45:12

you know business is awesome till

45:14

people get involved the greatest blessings

45:17

in your life or your crappy

45:19

ones that got in the door

45:21

and that's where it comes from

45:23

so no, I wouldn't I think

45:26

you're calling out the downsizing for

45:28

the wrong reason because you've assigned

45:30

the stress to the wrong thing.

45:32

You've said it's payroll size or

45:35

revenue size, it's not. If you

45:37

could do 10 million, if you

45:39

could do 10 million and you

45:41

had 50 people, you'd have an

45:44

incredible life. But they had to

45:46

be the right 50 people. Right.

45:48

And if you got 10 bad

45:50

ones out of those 50, God.

45:53

You got a nightmare. So

45:55

no, I think you need

45:57

to scale the business. I

45:59

think you need to continue

46:01

to grow your business but

46:03

what you're learning is a

46:05

hiring process that keeps problems

46:07

away. I'll bet you've even

46:09

run into that. How long

46:11

you been doing this? We're

46:13

just finishing up our third

46:16

year. Okay. Have you seen,

46:18

have you noticed a pattern

46:20

with the customers that are

46:22

crazy? Yeah, for

46:24

sure. Yeah, to where you can say

46:26

I see that one coming. I'm just

46:28

not going to take that job This

46:31

is more trouble than it's worth Oh,

46:33

yeah, yeah, so that lowers your stress

46:35

When you when you identify a pattern

46:37

with crazy customers you go, uh The

46:40

last time someone acted like that when

46:42

we were signing them up, they were

46:44

a pain. The last three times someone

46:46

acted like that, they signed up, they

46:49

were up, they weren't worth the trouble.

46:51

We ended up losing money on the

46:53

job and they still were pissed when

46:55

we were done. I don't want them

46:58

as a customer and you just go,

47:00

you just shut your notebook and go,

47:02

you know, I'm sorry, we're not going

47:05

to be able to do this particular

47:07

deck for you. You're going to have

47:09

to get someone else. less energy burned

47:11

than that one crazy one would have

47:14

burned. Once you identify the pattern of

47:16

how you acquire a crazy customer and

47:18

how a crazy customer acts in the

47:20

initial interviews and we don't do business

47:23

with them, they take up too many

47:25

calories. Hiring a team is the same

47:27

exact thing. You're gonna get better at

47:29

it. I'm a lot better at it

47:32

than I was in the old days.

47:34

I used to use a mirror and

47:36

if they fogged it up, we hired

47:38

them. That's how bad I was. That

47:41

was dumb. And man, you want to

47:43

talk about getting some idiots in the

47:45

building that method right there will do

47:47

it and you got a problem And

47:50

you're trying to hurt cats and they're

47:52

all crazy cats You know, it's it's

47:54

it's just a mess. So David, I

47:56

think you're better at this than You

47:59

feel like you are and your lack

48:01

of confidence. I think you've learned more

48:03

in the last 18 months than you're

48:06

giving yourself credit for. I don't think

48:08

you're ever going to have the exact

48:10

same mistakes again. You'll have new ones.

48:12

But you won't make the exact same

48:15

mistakes in hiring or in crappy projects

48:17

that aren't profitable that you did in

48:19

the last 18 months. I don't think

48:21

that cause of stress will reoccur. You'll

48:24

have a different one later, but it

48:26

is not associated with the size of

48:28

your payroll. And it's not associated with

48:30

the size of your business. That's not

48:33

causing your stress. The fact that you're

48:35

assigning that is... Caused by you got

48:37

you got some of your confidence stolen

48:39

When you got your nose bloodied on

48:42

those other two things And now when

48:44

I look up I go gosh, I

48:46

don't know if I've got what it

48:48

takes to do this. Well, you do

48:51

have what it takes I can tell

48:53

by talking to you You've got the

48:55

right stuff to do this. I think

48:57

you've just framed it wrong and Once

49:00

you reframe it and say okay, I

49:02

am not a guy that has a

49:04

bad team. I have a good team

49:07

I had a couple of bad ones,

49:09

but that's not who I am. And

49:11

now I've learned from those bad ones,

49:13

and I may get other bad ones

49:16

in the future, but I won't get

49:18

them for the same reason. And I'm

49:20

not a guy that has bad projects

49:22

that take too long and aren't profitable.

49:25

I know exactly what caused that, and

49:27

we won't do that process again to

49:29

create that style of business again. That's

49:31

no fun. I'm going to pass on

49:34

that. You're a good man. You need

49:36

to keep fighting fighting, brother. Remember better,

49:38

a wary warrior than a quivering critic.

49:40

This world needs more high quality leaders.

49:43

Take courage and lead. I'm Dave Ramsey,

49:45

your host. Thanks for listening to the

49:47

entree leadership podcast.