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- [00:01]
Dave Ramsey
You've got to be at Entree Leadership Summit this spring. And if you get your tickets this December, you'll even be invited to an exclusive Q and A lunch with me at Summit. So go to entreeleadership.comsummit today. Merry Christmas. From the headquarters at Ramsey Solutions, you're listening to the Entree Leadership Podcast, the show where I take calls from business owners and leaders just like you about what it takes to win at any stage of business. I'm your host, Dave Ramsey, with 30 years of experience founding, leading and growing successful businesses. As a gift to you and as a token of our appreciation, my team and I would like to share a talk I gave earlier this year at our Entree Leadership Summit. It was our 10th annual event, so I spoke about what it takes to start, build and maintain something great. Looking ahead at the next 10 and beyond, here's what I want you to remember about character, commitment and courage. Enjoy. So 35 years ago, most of you in the room know the story that Sharon and I lost everything. We got the opportunity in our late 20s to start completely over. We were bankrupt with a marriage hanging on by a thread, a brand new baby and a toddler. Rachel Cruz was born in April. I filed bankruptcy in September, and she was Rachel Ramsey then. So I remember standing in the shower with it so hot I could barely stand it and just stand there and cry because I was so scared I couldn't breathe. And I had met God on the way up, but I got to know him on the way down and I started finding out that the Bible said some things about money and I have a finance degree and all these letters and licenses after my name. But I was broke and I was amazed at these biblical financial principles because when I talked to old rich people, they told me the exact same thing. And. And it turns out it sounds ridiculously like common sense, which was so rare 35 years ago and is even more rare now that having common sense is somewhat like having a superpower. Things like live on less than you make, get out of debt, have a budget, be generous, always save and invest. These common sense principles come straight out of your grandmother's playbook and out of the Bible. And I started applying them in our lives. And then I started helping people at our church that were struggling with money and helped a guy stop a foreclosure on his house and walk through and I just start a little ministry was born. And later a guy said, hey, would you. I'll pay you if you will come over and coach and show a guy in Our company that's struggling with money, how to do this. And then I was invited to speak at that company. I'd never spoken anywhere. I was so scared I couldn't breathe. And all of this started to be born, this whole Ramsey Financial thing. I was still doing real estate deals, or I'd gone back to doing real estate deals after going broke. Only I wasn't borrowing any money. Cause no one would loan me any money. And so I was doing flip this house before Chip and Joanna were born. But the idea of helping people with this money stuff just kept getting bigger and bigger and bigger. And I couldn't hold it in my space, couldn't space it in my head anymore. There wasn't room for it anymore. And so I started having to actually start doing it. And the first thing I did was I said, okay, if I'm going to go full time and not do real estate anymore, and I'm going to work on this financial peace stuff and I'm going to help do books and seminars and maybe a class. The first thing is that for sure, I don't want employees. Because as far as I was concerned, employees come late, leave early, and steal while they're there. I didn't want any employees. And it was just me and my wife. Young kids were hanging on each day for dear life. We were terrified. But. And the unknown is scary. You know, I'm making mistakes left and right, left and right, left and right. And we walked our way through that. And I got to tell you, you can do this. You can do it. I. The first thing I did was I hired a guy named Russ Carroll. And he came to me through a thing. He had gone through some of the training I had been through on what the Bible says about money. And I met him that way and we went out to dinner and I said, I don't want employees. But if you want to form a team, we'll be a team. But I really can't babysit you. I have no desire to run a kindergarten class. Life is too short and I'm way too broke to put up with it. And I really don't have the money to pay you anything. So you better be good at this because otherwise it's not gonna work. And we began developing the proven principles and fighting and scratching and clawing and trying to. All the dumb butt stuff I have done in 35 years, all the false starts, all the dead end roads I went down, all the box canyons I went up full of lions, tigers, bears and jitterbugs. Oh, my God, the stuff I have done, the things I've exposed myself to just because I wouldn't. And I was just purely running and gunning. All I did was just outrun my stupidity continuously. Anybody relate. It just felt like if I just worked harder, it'd be okay. And we began developing this system and we didn't realize it. We were walking through the system and now all these years later, we've now over the last 15 years, led and worked with small businesses like you, about 10,000 of you across the nation, and watched your companies go through a process that we've clearly identified that is replicatable and happens over and over. And the good news about identifying the process is it keeps you from running up all those dead ends because you know what the next step is. I didn't know what the next step was. I just had to go. I had to go. I had to do it. I had to do. I didn't know where to go. And so I just overcame it with sheer willpower, effort and activity. And it took twice as long because of all the stupid butt stuff I did. By not knowing what the next steps were, by not knowing, I was involved in a process that was naturally unfolding. But I only could see it now when we look back at it and it's very clear. So there's two things I know about this system that we're going to talk about. One is it's not theory. This was not born in a think tank at Harvard and we wish it was true. It was not written out by a finance professor who's never made payroll. We make payroll. Never missed one. 35 years we haven't missed. So we did this. I gutted this out. Many of you have gutted this out. We walked with you while you did it. And we've observed this replicatable clear system. And the second thing I know about this system is that these, these things that we've observed and now we're applying to make it smoother, is business is still hard. Knowing the next steps makes it more efficient, but it's still freaking hard. If you're a wuss, I don't know how you got in here and you probably won't be back next year. Business is hard. Anybody that tells you it's easy doesn't know what the flip they're talking about. And I keep waiting on it to get easy. I keep waiting for someone to discover me and just write me a check. Not gonna get easy. Bad news. The good news is we have found a way to make it more efficient, more Predictable and walking out these steps. And there comes a time that you can't keep doing business by the seat of your pants. And for you, that time is now, because I'm going to show you how to stop it. I didn't know all that back then. We call this the entree leadership system. And we've been working on it very, very detailed for a long time now, back in the day. So the unlock was I started to recognize about six key areas in the business that were driving the business. At first, I didn't realize. I realized they were there and there and there and there. And then we started looking at them and then went, wait a minute. No, they're progressive. And once you go through them, you're gonna go through them again and take each one of them deeper. And then you're gonna go through them again and take each one of them deeper, and then you're gonna go through them again and take each one of them deeper. There are six of them. The first one is personal. I discovered that I am the problem with my business. John Maxwell, in his famous book, the 21 Irrefutable Laws of leadership, calls this the lid. The leadership lid. I'm the lid on my business. I'm the problem with my business. That's the bad news. It will never grow faster than I can personally grow. That's the bad news. The good news is if I'm the problem, I'm also the freaking solution. And I can just decide to be at stuff like this. Feed my brain, feed my spirit, and go home and kick a whole nother level of butt that I've never done before. I can decide to be better. Obviously, I'm not the same leader I was when I was 32 years old. I was just a freaking boss. Bosses push, leaders pull. I had to discover that. I didn't know that. And as I have been transformed by the renewing of my mind, and you're being transformed by the renewing of your mind, that's personal growth. And you start getting out of your own way. The second one is purpose. Business is bigger than the bottom line. If the only thing you're in business for is money, you do not have emotional staying power. It's not sustainable to just work for money because it's too freaking hard. The bull crap you put up with, the betrayal you put up with, the ridiculous things we face, and you go, what in the world? There's your parents, cousins. How did you come up with that? You and I know what I'm talking. You know what I'm talking about, oh, my God. It's just the frustration level makes you want to just. It's not sustainable. You can't push through that kind of stuff just for money because you're going to go through too much crap. You got to have a sense of purpose, a higher calling. And your team needs to know that the work that they're doing actually matters. It actually matters. And here's some testimonials. Here's some customers that are happy that they did business with us. Well, Dave, I'm a plumber. How does my work matter? Boy child needs a shower. Your work matters. I don't get a shower that matters. I don't get a hot shower. It's going to be a bad day for me and probably some others. Your work matters. You got to figure out how your work matters. And your team has to plug into that purpose. And you got to constantly be yakking about this personal purpose, people. And we heard from Pat Head Summit famously yesterday, that you're not going to win the Kentucky Derby with a donkey. You need thoroughbreds. It's a constant process, as our friend Jim Collins says, to get the right people on the bus, the wrong people off the bus, the right people on the right seats on the bus, and the thoroughbreds in the right seat in the bus to get the work done. And you're going to do that over and over and over again, and you're going to get better and better and better at it as you go along. The first time I hired somebody, I thought I used the mirror test. If they could fog up a mirror, then we probably could do it. I was so dumb, I thought if you hired people, they would work. I was so dumb, I thought if you hired people, they would care. That's where I started. You got to get the right people on the team, and you got to release into the wild the ones that shouldn't be there. You got to fire some people. Not today, but you will have to fire some people. Then you have to have a plan. My friend Zig Ziglar used to say, if you aim at nothing, you'll hit it every single time. You got to have a plan. Winning is an intentional act. No one accidentally wins the Super Bowl. No one accidentally becomes successful. No one accidentally has a great marriage. It's not an accident. It's a series of intentional acts executed with. With a desired future. And then we develop a product out of all that, a product or a service that we put in the marketplace. And we have to deliver excellence, and we have to Service it and we have to fix it. Cause it always breaks and then we gotta do it again. Oh, and then it becomes outdated and we have to do a version 6.40 and then we gotta do it again. And the product then creates profit. And Ken Blanchard says that profit is the applause that your customers give you. And my friend Rabbi Lapin, Rabbi Daniel Lapin famously says that if you do a great job for your customers, they will give you certificates of appreciation with presidents faces on them. The natural byproduct of serving the community, serving the world, serving the customer. Well, the natural byproduct of that is profitable. And so if you make a lot of money, you are not evil. Even though the lefty communist professors tell you you are. When you make a lot of profit, you're an American, you did a good job, you're part of capitalism. We don't believe in anarchy and communism and socialism here. I am a capitalist pig. I love it. It's the best system ever devised. So get up and go do something. Profit is the byproduct of loving your customers. Well, it's the byproduct of putting out something excellent in the marketplace. You put out crap in the marketplace, you screw people, you don't make a profit because nobody does business with you but once. And they tell everybody to not do business, even that once. You create repeatable customers referrals, you create everything just by simply doing the right thing. And profit is a natural flow downstream of that. And then guess what? You get to do it all again. You get to work on you again and go deeper. You get to work on your purpose and drive it deeper into the organization. You get to work on the people and get new ones and replace some of the ones that can't make it at this next level. And oh, it's such a process. Go around these six drivers of business over and over and over again.
- [16:00]
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- [17:03]
Dave Ramsey
Now, when we look back on the Ramsey track, and we look back on many of your tracks, and we've used these case studies to put this Entrez leadership system in place, we see that as you spin around these, you end up leveling up. Sometimes you spin around them four or five times, but four or five times per stage or sometimes one time per stage. But you end up going through five distinct measurable stages of business. And this is where we want to camp for a little while. The first stage of business is the treadmill operator. Treadmill operator is there's not enough hours in the day. I need to hire my first employee. God help me. I got Russ Carroll, my first team member instead. We rented a tiny little 800 square foot office and we hired our first lady receptionist there. She was the bookkeeper of the receptionist. She did everything that Russ and I didn't do and she lasted about four weeks and she was yelling at everybody in the office and I'm like, we're a three person Christian company and we can't get along. I'm a total failure. We started the whole process. Ugh, it was a mess. Brought in another lady that was very sweet. She stayed a long time. A year later, we were seven team members. I was the CEO by then, the chief everything officer by God, if it needed done, we did it. I set up chairs, I hauled books, I printed out invoices. I wrote all the checks by hand in those days, wow, I was doing so much work. I was running in circles. I was a dog chasing its tail. I was a squirrel on the road that didn't know which side to get over. I was running, running, running, running, running, running, running, running like a rat in a wheel. I was on a treadmill. I'd come home from work after working my butt off for 16 hours, collapse on the couch, and my wife Sharon would say, what'd you do today? I have no idea, but I did a lot of it. You relate to that. Some of you there right now, but some of you just remember that stage of business very clearly. The treadmill operator feels like a rat in a Wheel, all we're trying to do is just get payroll by Friday. We got to get the. We got to get the receivables in. We got to do cash on the barrel here with some customers, because, by God, we need the money in the door. Cash flow, cash flow, cash flow. I got seven people counting on me to eat, and it's my job to produce enough revenue to make Cash Flow Friday happen. But what if you had a team that would actually help shoulder some of this? So the deal with this is the treadmill operator. Your focus is you got to get some of the work off your plate. Key problem for treadmill is this. Too much of the business relies on you. The operations, the revenue, production. Too much of the business relies on you. So how do you break out a treadmill operator? You know, we're probably doing a million, $2 million a year top line, maybe even $3 million a year top line. But, by God, I was just gutting all of it. I was just going in the street, killing stuff and dragging it in by myself. You know what I'm talking about? Y'all remember doing this, or some of you there right now? And it all depends on you. You really don't even own a business yet. You just own your own job. It's kind of how it feels. Can't take a vacation. You can't get sick, because the whole freaking thing stops if you do. So you gotta level up out of this. Cause it's really not sustainable. You try treadmill operator for 20 years, it just won't work, man. It's no fun at all. So you gotta level up. How are you gonna level up out of that? Well, the action plan. The key points to level up are this. You gotta increase your time management. You've got to get in the business of delegation. You've got to delegate some of the revenue production. You got to delegate some of the production. You've got to delegate some of the operations. And you do that by hiring. You hire thoroughbreds that are team members that can actually do crap. They actually do their job. And their job is to take on part of the weight of. Of this business. And as you're distributing the weight of the business off of your own shoulders, you're leveling up and you're moving out. And you got a budget for this, of course, because you got to pay these people. And thoroughbreds generally cost more than donkeys. Matter of fact, they always cost more than donkeys. The difference is they actually can win the Kentucky Derby because donkeys are just donkeys. They're just a problem. So when I was in this stage, what it looked like was we had about 12 people and I was doing a radio show three hours a day. I was teaching Financial Peace University with a bad suit and an overhead projector, and I was running the business. And so what it would look like is I come in in the morning, 7:00, and I worked my tail end off until about noon. And then I would drive to the other side of town to the radio station that was carrying our radio show, and we were starting to broadcast it to a few other cities. And I would drive 35 minutes to the other side of town, do a three hour show, usually eating a pizza during the commercial breaks, and then drive back at 4 o'clock, go across the street to the Holiday Inn, where we rented the ballroom to do Financial Peace University every night. They made us tear the room down and rebuild it every day because they might want to have a Kiwanis Club lunch in there. Probably not, but they did it anyways. We got a better price if we did all the labor. And so me and one of the other guys would go over, we would set up 300 chairs. We'd get that stupid snap thing on the screen, snapping those screens around, put that screen up, that thing would always pinch. You had blood blisters forever. And then I had this overhead projector. Y'all remember those? If you don't look it up, it's on the Internet in a bad suit and an overhead projector. I would teach for an hour and a half a Financial Peace University lesson. We would break out into small groups, 300 people. So we rented all the sleeping rooms on the first floor of the Holiday Inn every night. And we stood all the beds up against the wall, and everybody took their chair and went in and did a small group discussion in all the different sleeping rooms on the first floor of the Holiday Inn. And we had group leaders that led those groups. And then, of course, when the small groups were over, someone, inevitably out of 300 people was in the middle of a crisis. And I would end up sitting down with some single mom or some couple whose marriage was on the edge and walking them through how to not get foreclosed on, or how to not get repoed, or how to not kill each other because they're so mad over the money stuff, and pray with them, drive home, collapse in the bed at 11:30 at night and be in the office at 7:00 the next morning. And I did that every single day. Three years, my wife said she was a single mom during that time. She was. I was never home. That was my treadmill stage. Then some guy comes in that's working for us and goes, hey, I saw this thing at my church. And this. These people were. Had this class and it was on video. It was on a VHS tape. And the class at church on Tuesday night, they put the VHS tape in. We watched the tape and then we had a discussion. We've got to put this financial Peace University on video because then it can go everywhere because what you're doing is not sustainable. You can't keep doing this. Plus, we were doing this Monday, Tuesday, Wednesday, Thursday, Friday, Saturday night, and did a matinee on Saturday afternoon. We were doing six, seven classes in six days. And he said, this is not sustainable. And we've maxed out. They were all full. We logistically can't grow. We have to change the model. We have to change the format. And I'm like, I was so angry. I said, you're absolutely full of crap. Let me tell you what happens. I'm on the stage. I'm the guy with the story. I'm the guy with the passion. I'm the guy. The jokes work because I'm in the room. The tears come because I'm in the room. They can feel. Feel it coming off of me. You put a video in, it's going to be starch. It's going to be stag, stagnant. No one's going to get it. The life change is not going to occur. It's going to completely fail. This will not work. And he said, yeah, but you're just going to die. And then this whole thing's going to go away. We have to try something else. We can't grow anymore. Our revenues are maxed out. We're doing all we can do. This way, you've got to try something. Even if you think it won't work, it will not work. You're just wrong. And he and I just argued and argued and argued. He goes, you have to try some new technology. What we're using is not working. Sounds like me and Daniel Ramsey arguing today. We spent $7,246 in two weekends and shot the 13 lessons of financial Peace University. In those days, that's what it was. And again, a bad suit and overhead projector captured on video. And we took those group leaders from the small group discussions in those hotel rooms and said, do any of you want to take these stupid VHS tapes with this hillbilly on them to your church and teach a Class, I'll do the teaching and you guys can turn the video off and have a small group discussion, discussion. And 50 of them said yes. And I'll never forget walking in the back of one of these churches and the things on the front of the screen and there's, you know, 40 people sitting there watching it. They couldn't see me. I was behind them and I cracked a joke and these people laughed. And on the video I said, if so, and so happens everybody, if that's you, raise your hand. And these goobers raised their hand and I went, well, I was just wrong. This video crap is going to work. And we ran two duplicating houses almost out of business because they were running 24 hours a day trying to keep up with us because of the exploded our growth. We stepped off the treadmill stage, finally got margin, didn't have to teach every night. I didn't have to personally physically be there anymore. The logistical nightmare was unplugged. But also the personal treadmill was turned off and we leveled up. It unlocked the door to the next stage, the Pathfinder stage. Once we recorded Financial Peace University, of course I could focus on other things. I had more team members now and I felt like I was herding cats. It's like when Daniel was little, my son was little, he played ice hockey and I coached his ice hockey team. I played ice hockey a little bit when I was a kid, up into college. And so I'm out there with these five year old little boys on ice skates and they have one thing to do, whatever they want. They're like little bear cubs running around chasing a black dot and there's no coaching them. It was just like daycare on skates. And it kind of felt like they're running this business. I thought I was herding cats. It's like trying to nail jello to a tree, putting out fires all day long. Everybody's just running off doing their own thing. There was, nobody knew what the other one was doing. We were all just doing stuff. It was crazy. And Russ and I, when we first started, Russ Carroll, my first guy, and I, we sat down and prayed about and wrote a mission statement which was very good. And it was our mission statement. As a matter of fact, we think God was involved because to this day, 35 years later, it's still Ramsey's mission statement, only with one minor change in 35 years. So it was a good mission statement. But I started to notice as I was doing this, there was kind of this. You ever felt like when you walk in the office, there was like. Like you were walking through molasses or like there was a cloud overhead. I felt like pig pen and peanuts. Like there was just something wrong in the air, but I couldn't figure out what it was. I could just feel it in my spirit. I could smell it in the air. But there was something wrong. But everything wasn't quite going. Everyone was. The enthusiasm was starting to kind of drop down, and it was more like people were just mailing stuff in, and I couldn't figure it out. We were doing a staff meeting every Monday, which we still do, and 12 of us at that time. I had my little staff meeting on Monday morning, and I had an appointment right after that. So I got up, left the staff meeting, went to my car to go to the appointment, realized I had forgotten my keys. They were on my desk. And I walk back in, and my top salesperson, the lady who was a real character, had her back to the door, and she did not hear me come in the door. And she's talking to all the rest of the team, proceeding to tell them how stupid Dave is and how all the stuff he's doing is wrong. And if he would just do this, this, and this, he could figure out how to run this business. But we're probably never gonna get anywhere because he's the problem. And this and this just tearing me up. And I'm standing behind her. She doesn't know I'm hearing all of this. And they're looking at me, looking at her, and they're going, you know, they don't know. They're somehow trying. And I guess the hair finally stood up on the back of her neck. This went on for about three minutes. Felt like three years. If you've ever heard someone just completely trash you in person that didn't know you were hearing them. Finally, the hair stood up on the back of her neck, and she turned around and she said, oh, yeah? I said, yeah? She said, yeah, but, but, but, but, but. And she starts trying to crawfish and back up into that hole, right? Just running back as fast as she can run backward. And I said, well, I think we just need to come in my office for a minute. And we walked in, and I shut the door. I didn't even sit down. I said, I think we're done. She said, what do you mean we're done? I said, oh, we're done. Because there's two problems here. One is you work for a stupid guy, and you keep working there, which means you're dumber. Than he is. So I'm going to help you with that. Now, this is your last moment of employment here, and so we'll figure it out later. But you need to get your stuff and get out of the office while I'm on this appointment, because I'm too angry to talk to you right now. And I'm going to say things that I might regret later. And you know, the worst part of this whole thing was my wife had told me not to hire her. And every time we would get together with a company thing, the woman was just real outgoing. She had a lot to say, obviously. And. And every time we get together for a little company get together, be riding home and Sharon's going, woman's not right. There's something wrong. I said, you're just quiet and she's outgoing. You just don't like that kind of woman. And you know, she's just a. She's crazy and all that. You just don't get it. Salespeople sometimes are that way. Honey, you just need to, you know, she goes, there's something not right now. I gotta go home and tell Sharon that I have fired this chick. Oh, it's double hit man. But you know that scene in the old wizard of Oz, the ancient one that we used to watch on Sunday nights with Liza Minnelli's mother, Judy Garland, Right? She was Dorothy. And so towards the end of the movie, the original wizard of Oz, the wicked witch's broom catches on fire and Dorothy grabs a mop bucket full of water and throws it to put the fire out and accidentally splashes the water onto the witch. And the witch starts melting and going through a trap door and dry ice is coming up. What a world, what a world. You remember the scene, right? And she goes through, and then there's just the hat and that's it. And a little bit of smoke. And all of the witches army were standing around and these guys were dressed like somewhat of a cross between Oompa Loompas and Cossacks, right? And so they've got these poodle looking bloomers on and big curved swords. You remember this? Anybody remember this? And what a world, what a world. And there's this pregnant pause right after the witch is gone when you think, oh, no, they're going to turn those curved swords on. Poor little Dorothy because she's killed their boss, she's killed their friend, she's killed their mentor, she's killed the person that they trust instead. They didn't. They went boom. All hail Dorothy. Who killed the wicked Witch. That's what happened when I walked in. After I fired that woman, the air cleared up in the building and we discovered what the smell was. The smell was gossip. And I said out loud that day for the first time, and I've said it for a long time ever since. One of our core values is, I will fire you for being a gossip. I just did it and I'll do it again. When you have problems at Ramsey, not if you will have problems. When you have frustrations at Ramsey, and you will have frustrations, you're there to cause frustrations to go away. That's part of your job. So expect frustrations and expect problems and expect people to sometimes not be exactly who you want them to be when this occurs. Not if it occurs. It's going to occur when it occurs. You have one option at Ramsey. You must hand your negatives up to someone in leadership who can do something about it. But if you hand your negatives down or sideways, that's called gossip. I'll warn you once maybe, but we'll probably just fire you. And when you take a poll of the 1100 people that work at Ramsey today, they will tell you of our 14 core values, that is by far their favorite because it's the first place they ever worked where that stink was not in the air because of a zero tolerance for it. After that woman, because I'd been wandering around for six months trying to figure out what the flip was wrong with my business. I didn't understand. So core values were born at Ramsey. And that was probably the first one we wrote down. So we started to get clarity. So the key problem when you get to Pathfinder is you lack clear direction. The way you fix the lack of clear direction is to level up. You put your mission down clearly. You set your vision very clearly. You set your core values in place. And then you talk about them a lot with role clarity and with communication. Tons and tons and tons of communication. One on ones. We need. We need one on one meetings with everybody. And I know Vanessa told us yesterday, don't call them one on ones. Call them accountability meetings. Okay, we need accountability meetings. I'll go with that. We called them one on ones until yesterday, but maybe we'll change it. Okay, so I kind of liked what she had to say. She was pretty incredible. Speaker. I love the content. I filled up my whole book with her stuff. And so. But I mean, yeah, so one on ones. Accountability meetings. We have staff meetings. We have a devotional once a week. Everybody comes to. We do all kinds of Things to communicate. I started in those days doing to increase communication, started doing weekly reports, and people had to turn in a weekly report. And I didn't ask them to do anything. I said, just write down or type out on a piece of paper and turn it into. My assistant, Patty, what you did this week, that makes me glad you're here. If you were running this place and own this place and gave you money, why would you be glad you were here? You made a sale, you made some calls, you fixed a problem, and tell me something good that's going on and something bad that's going on. Give me a weekly high and a weekly low and no format, which was a huge mistake because these people, I mean, the creatives would turn in stuff with full graphic packages and the accounting people would give you three spreadsheets and it would take you hours to read. Take me hours to read through these stupid things because they were not formatted in any way. But I just, I was getting information, I was getting information back and they would take them to Patty and they had to be in by 3 o'clock on Friday because I'm leaving after the radio Show's over at 4, 4 o'clock, and I need to have a big alligator clip on 50 or 60 of these sheets. And I'm going to throw them in my, in my backpack and I'm going to read them over the weekend to find out what's happening in my company. And that's how weekly reports started. Now, if you're in elite, how many of you are in elite right now? You've got the world's best. One of the best things in elite by far is this weekly report tool. And we use it at our place. It is absolutely stinking incredible. And we'll talk to you about it. But I mean, it's. The team fills it out and it's got a little red, yellow or green faces about their morale, their stress and their weekly high and their weekly low. And it's really, really good. And so we work through that. Communication, communication, communication. Here's our mission, here's our vision. Are you going with us? Are you aligned on this? Here's the values. Here's the things we don't violate. Here's the things we always do. We do our work as unto the Lord. That is one of our core values. We do our. We have a no gossip policy. We have a marketplace vision. And the marketplace vision is, is if we help enough people, we don't have to worry about money. That's one of our 14 core values. They're all over the building. They're in your face on the first day at the work, in the onboarding. We're aligning you to the vision. We're aligning you to the process. We're aligning you to the core values. And then we're going to communicate. Communicate, communicate, communicate, communicate, communicate, communicate, communicate. And stay aligned, because this is who we are. Are you a we? We are French we.
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Unknown Advertiser
We.
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Dave Ramsey
You've got to do this to be a we. And we talk about it all the time. And. And about the time, you're so sick of talking about it that you think you're going to throw up. They hear it for the first time. You got to say it over and over and over and over again. My friend Andy Stanley, a pastor down, great leadership speaker, pastor down in Atlanta, says you got to tell them 21 times before they hear it once. Sorry, but that's the reality of life. Because they're hearing it through their paradigm, Their personal issues, whether they were late to work that day, whether their car has a flat tire. They're hearing it through all this. So they're not hearing it most of the time. You got to communicate, communicate, communicate, communicate. And then gradually, the ducks got in a row, and it didn't feel like herding cats incrementally 1% of the time, maybe if we were gonna do James Clear, but a little bit at a time. After we kept doing this and kept doing this, everything got in line. Now we're heading towards being Trailblazer. Trailblazer. We started making some money. It was fun. For the first time ever, I wasn't desperate on Fridays. For the first time ever, I wasn't freaked out about cash flow. We were stacking cash, baby. It was cool. Everything we touched seemed to turn to gold. It was nice. I actually got a good car. It was awesome. We started seeing, hey, we could 10x this thing. I mean, we're doing about $30 million at that point. We thought, gosh, you know, we could do a $300 million company someday. We could. We could see it. We could feel it. We could see the trajectory. We could see the hockey stick up and to the right. The numbers were moving. The viewership, the listenership, the attendance, the engagement, all these different metrics and KPIs we were using were all starting to click and tick. And some of our processes were still back there. Some of our systems were antiquated, but we were afraid to touch them because they were working. Even though it was ridiculously laborious, the labor intensity One of the things we did, we've now had 10 million people go through Financial Peace University. Okay. During that stage of that organization, we were having about 150 to 250,000 people a year going through Financial Peace University. We would go and speak at a thing like this and then have a table at the back and there'd be lines out the door to sign up for Financial Peace University. Now, obviously, obviously, we don't take credit cards, but we had to get your debit card information and we had. Or get your checking account information so we could ach your checking account. And that's how we sold it in those days. This is before Stripe, before there was an Internet. It was before any of this, right? And so you. How dumb is this? We actually had you hand write out your debit card number or your bank account number on a piece of paper, a form. And then we bought this software that was supposed to scan it and read it and put it in. And it was like. It had like a 40% error ratio. So it was like always wrong. And so we couldn't use it. We threw it in the trash and we went back to human beings. Stacks of these things, keying them one at a time. This is how sucky our system was. Our system was. So it was like something from the 1950s or something running a 10 key and pulling stuff off, only they're actually entering it into a database and then trying to process the payments, and we weren't getting the payments in. Sometimes we couldn't get all the work done. We couldn't stay ahead of the curve. So sometimes three weeks before we hit your account after you bought it, and it was like, oh, oh, I forgot I did that, you know, wow. So we realized we had to fix these systems and we were stretched too thin and we had to work smarter, not harder, and all that crap that people say. And I had three guys running the three divisions of the company at the time. And I got my first CFO in Mark Floyd. And he was with me for 14 years before he retired, just not long ago. And those three guys and Mark and I grew the business until 2012. And it just kept growing and growing and growing and growing. How do you level up now from Trailblazer to Pathfinder? Well, the key problem. How do you go from Pathfinder, I'm sorry, to Trailblazer? The key problem is you lack the plan and leaders to scale your business. So we had to put a better plan and better systems in place to scale the leaders. So the action plan to level up is developing leaders. You've got to delegate leadership. You can't just delegate. If you only have one layer of leader where you delegate to a leader that leads people, you're not yet there. You've got to get to the point that you're delegating to a leader that leads leaders that leads people. And then you're starting to get these layers of leadership delegation working. And it's really a much more sophisticated model. And you've got to do the systems and processes. Clear talked about that yesterday, ironically enough, but that's true. Systems and processes will kill your butt when you're a primitive upstart company. If you don't get those systems and processes and just beat the snot out of them, they're going to be the thing that holds you back. And we've clarified all that. Man, we spend so much energy and bandwidth and calories burned on system and processes even to this day, just to stay ahead of them. And this was the first time we really started looking at strategic planning because we had pretty much just said, we got to get through Friday. Strategic planning was if we make it till Christmas, one Friday at a time, we made it. That was our strategic plan. Now we had to really start doing things. And one of our biggest department leaders, one of our vice presidents that we were delegating to, delegating to, delegating to, said, hey, I just hired a guy to come in from Colorado and lead a stratop. And I said, you did what? And she said, yeah, I paid him. We're paying him. I said, how much are you paying him? $5,000. You're paying somebody $5,000 from outside the company? Who doesn't run a company to come in and tell us how to run a company? I really think you're stupid. She said, well, we've got to do something. We have to get above this. We can't just stay down in it. We got to get above it. We got to start flying, you know, 30,000 foot view because we're running into stuff that we could have seen if we'd have been up above it. And she said, this is ridiculous. We've got to get above it. We've got to try something different. I'm like, what is a strat op? What does that even mean? She said, strategic operations. I'm like, what does that mean? She said, get above all the crap and see how to shovel it. Okay, really, this sounds, sounds very corporate to me. I'm an entrepreneur. I think we should just kill things and drag it home. And she said, we are, but we don't even have room for all of it, so we need to figure out what we're doing. She argued with us. All right, you know, it's $5,000. Go for it, you know. And they came back and they were all like had. Their little faces were lit up and they were so happy and motivated from this stupid butt stratop. And they just loved it. And then it spread all through the company. Then they wanted me to sit in one. Oh, God, it's like a root canal. It's the best thing we've ever done. It changed our whole business. And I just hated it. I still kind of hate it. But it works. It absolutely works. Learning to do strategic planning. Because what had happened was, is I hired MBAs, masters in business working for me. I don't have an MBA. I've got a PhD in dumb. And how many of y'all got an MBA? Anybody good? That's really cool. It's a great degree. It's a great study. 100% of the MBA programs I've had any interaction with always teach strategic thought. It's hard to get an MBA and not learn to get above the problem and look at it from a 30,000 foot view and show, you know, if we just go around the barn, that way we don't have to tear the barn down. It's easier drive around it, you know. And so it's a really, it's a beautiful thought framework if you bother to do it. And so these MBAs were on our team. We'd hired these thoroughbreds and they knew crap I didn't know. And they're saying we need to do strategic thought. We need. So we had a really good trade. They, they taught me about strategic thought and I taught them how to work. So it was a good trade. We had a good time. And so we started doing the strata ops. We started delegating the main areas of the business to leaders. And now I started leading leaders that led leaders. And they were strong and we had core values and we rely on mission. So they could finish my sentences, which made it very easy if I knew that they knew exactly what I would do when I wasn't there in those situations, then it was very easy for me to delegate to them. You can delegate to people when you trust their competence and their integrity. And I leaned into that. And I leaned into that hard. And so Sharon and I went on a vacation. We were in Scotland. I'll never forget it. And there's the Ramsay castle, where Ramsay's Scottish. And so we're staying in the Ramsay Castle, Dalhousie, and it's now a bed and breakfast. And so it's very cool. Got a five star restaurant in the dungeon. It's. That's neat. So we were staying at this castle and I get an email from Matt, one of my executive VPs. It's one of the guys running the company with me. And he goes, hey, I need to give you a heads up. We had a thing happen and we took care of it, but we did exactly what you would have done. And we just wanted you to know we did it because we dropped some money. And I'm like, oh, okay, I want to read this story. So Steve Naismith was a guy, he's a marketer working for us at the time. And Steve had an 11 year old son that went to Asheville, North Carolina, seven hours from Nashville, Tennessee to a summer camp playing dodgeball. He got hit in the head with a dodgeball and unbeknownst to them, he had had a aneurysm or he'd had a weak vein or whatever that caused an aneurysm since he was a child. And a freak accident with a freak medical condition that was unknown. Hit him in the head and he's got a brain bleed. And they call Steve and said, you 11 year old's in ICU and they're saying he's not going to make it. Maybe two or three hours. You need to get over here. Well, there's no way to get to Asheville, North Carolina in two hours or three hours from Nashville. So our team did what we do. We treat other people like we'd want to be treated. How would I want to be treated if my 11 year old's got 3 hours to live and I can't get there? We chartered him a jet for 8,000 bucks and sent him over there. There's a lot of money to us in those days. And. And he got there in time. And wonderfully, Will, his son recovered and made it. And we actually ended up having a 5k race. And the area to raise money for Will is called Willpower. And we had a 5k race for will for years in the area to go with this. And my guys are like, they made all of these decisions without even asking me because they knew that that's what we would do at Ramsey because we had always talked about what we would do at Ramsey. We treat other people like we'd want to be treated. And then you don't have to worry about anything called Loyalty. And if you do have to worry about loyalty, you don't think anything at all about firing their butt. When you do stuff like that for people. Right. If you observe me, do that for Steve, and then you're disloyal over here, knowing I'm going to be that loyal to you, then I got no qualms at all about putting your little butt on the street in a heartbeat. And so we'll talk this stuff through. We're going to treat you like we'd want to be treated in this situation. Your daughter works on our team. You know how she's going to be treated and how safe she's going to be in that environment, because my daughters work there. We're not going to have sexual harassment. We might have a murder, but we're not going to have sexual harassment. Right. I'm going to treat you like I'd want to be treated. That's the process. That's when I knew we'd hit another level. They could make a decision that was an expensive decision based on values and alignment, and it was all delegated to that level. And I'm in Scotland having dinner. That's a trip, y'all. In that moment, I thought this might be the most fun I've ever had in business. Cause it's starting to work. I don't have to carry all of this by myself anymore. And then that starts moving us towards the peak performer. Does leading your team feel like herding cats? Even if your business is winning financially, a misaligned team will create new fires for you to put out every week. But with Entree Leadership Elite, you'll align your team and hold them accountable so you can stop herding cats and start scaling your business. To join elite, go to entreeleadership.com elite or just click the link in the description if you're listening on YouTube or podcast. Business is great. Let me tell you what, man. Peak performer of all the five stages is the most fun of all. Not only is everything lined up and working like it's supposed to be working, but you are making bank. It is like, oh, yeah. And then stupid people come out and go, you're so lucky. And you just want to get up right in their face and yell at them. Luck had nothing to do with this crap. God's blessings. Yeah. My hard work. Yeah. Don't you call me lucky. Lucky comes to work in overalls and has calluses. That's what lucky does. I got you, Lucky. Oh, God, that drives me nuts. But you're starting to kick butt. Now, man, it's moving, right? You got things going and you're stacking cash and everything you touch is working. And it's like, woo hoo hoo hoo hoo. Every day is like something good is happening. Peak performance is a wonderful stage. And, you know, you worked your butt off at this point. We always say, we worked our butt off at 20. We're an overnight success, right? Everything's going good. And so we had been. I'd been on every show at this point. I'd been on the, you know, Larry King was big. Any of you old enough to remember Larry King? Yeah, and Larry King I was on. Remember there's a show, Sally, Jesse Raphael, y'all remember that one with the red glasses? I was on Sally's show several times, and I was on every dadgum show out there. But I couldn't get on Oprah. Oprah was the big dog show in those days. If you could get on Oprah, you could sell a million books just from the appearance. If she extended her scepter towards you like the king of old and blessed you. Bless you, my son. I endorse the book. Boom. You know, Barnes and Noble explodes, right? And so I. But I couldn't get on Oprah. And Oprah's people would call and tease us. They would say, we're thinking about putting you on. Would you send us some stuff? Yes, we'll send you some stuff. We'll send people up there. We'll send an emissary, an ambassador. What do you need? We'll send what you know, what is it? You drink. You'll have some. I mean, all of it. Anything you need. And they would talk to us like three times and then just shut us off, ghost us. No response, no response. And so I'd been on everything but Oprah. And the joke around the office was, I've almost been on Oprah more than anybody because this happened like six times. They would call and then just drop us. It was like the pretty girl in high school toying with you or something. It was just ridiculous. So finally, 60 Minutes calls, and Leslie Stahl wants to do a story. Now, 60 Minutes is kind of a mixed bag because it's got huge viewership, and if they say good things, it's going to be a good day, right? But if they don't say good things, and they generally don't say good things, they generally trash you at some point in the story. Well, his detractors say, and they interview some goober who has an idea or an opinion, who's never done anything thing lives in his mother's basement, right? And you know, his detractors say. And so anyway, we finally get on 60 Minutes and it was a 12 minute positive story. And we're like, you can look that up in the Bible. That's called a miracle. And it exploded. And the next week, Oprah's people called. Hmm, right. We're like, well, we'll think about it. What day do you want us there? And we went and filmed the show. So 60 Minutes plays in November. It blew up the Internet when we were, we just got Internet, servers were all melting down because of all the hits. We go in the spring and film an Oprah show and they say, we're not going to play it in the spring. We're going to wait till September to play it. 60 Minutes calls and says, the show went so well last November, we're gonna play it at the end of our reruns in the summer. So the last week of August, we're gonna run it again. Get ready. And now we know what it is. It's 12 positive minutes. And Oprah says a week later we're gonna run it. And so we're getting these two things back to back. We called Larry King just cause we didn't want him to be left out, right? I mean, it was like, wow, this is like every. And our young team is all going, oh, this is so good. Look at all this. God's blessings. And this is just wonderful. And I'm like, yes, it's God's Blessings. It's also 25 years worth of work. God, you know, it's like Earl Nightingale used to say. He said, old preachers coming along the road and he looks down, sees this beautiful farm and he walks down. The farmer comes out to the end of the road and he's all dirty. And he says, your farm is so beautiful. Every row is perfect. There's not a, not a weed in sight. He said, God has blessed you with a wonderful farm. And the old farmer says, yes, sir, he has. And I get on my knees every morning and I thank God for his graciousness and his blessings. Preacher, you should have seen this farm when God had it all to himself. So yes, it's God's blessings, but it's also our hard work. And it's the combination of these two things. And we're trying to explain this to our team, that this just is not a random occurrence. Oprah didn't discover us. We couldn't even get her to talk to us. Come on. You know and so we started writing up how are we going to communicate this to people? And we decided to communicate it to them using what we call the momentum theorem. The momentum theorem. And that's fi over t multiplied by large G equals unstoppable momentum. Focused intensity over time multiplied by God equals unstoppable momentum. For those of you that are math nerds, anytime on one side of the equation you mold multiply something by an infinite. The answer on the other side of the equation is infinite. So when you take your efforts and you multiply them by the great I am. The answer on the other side of the equation is unstoppable momentum. And then you get to be up here 35 years later and do what I'm doing. And I get to sit backstage and go, wow, look at what God has done with the work that we did. And that is one of our core values. It's 14 on the wall. Be focused, be intense over time and always acknowledge that God's blessings are what's really causing it and taking our efforts and multiplying them times the infinite. And so as a peak performance, your business is now a well oiled machine. You're making bank. You stay here for a long time sometimes because the business is working. The only problem with peak performer is the key issue is you become comfortable and you can get just kind of fat. Like you quit working out because it's all okay now. Business is too comfortable. So the action plan that causes you to level up to the last stage is you constantly reconnect to your mission and vision. You keep the shock stick out and keep to the organization. You keep the organization excited and a little bit worried at all times. Proactive disruption. Break it before it's broken. Break it before it's broken. And in our fast rate of change culture in a digital world, if you're not out on the cutting edge trying some new technologies and some new business models and some new things at all time, you're sitting comfortable in your peak performer stage. It's going to catch up with you and hit you in the back of the head. Break it before it's broken. A relentless culture of getting better. We demand excellence and we're appalled and aghast when excellence does not occur. None of us are okay with it. If you keep at it, your business will keep growing and growing and growing and then you'll move to this last stage. You'll want to go to the legacy stage. And that's where you become a legacy builder. Now we're 100% in legacy builder at this point at Ramsey, Daniel Ramsey, my son became the president about 14 months ago. He and I have offices beside each other. I'm the CEO. We run this together now. We're having a blast as father and son doing it. We've been evolving into that for about 15 years to get to this point. Daniel's been on the team for a little over 10 years to get to this point. He served and been excellent all through the company has moved into this. And as a legacy problem or a legacy builder, your key problem is you don't have a succession plan. And John Maxwell says, where there is no succession, there is no success. So how do you deal with this problem? Your action plan to level up here? Well, you've got to start talking about how we're going to do a financial transfer. If you're the owner, how are you going to eat when the next gen is running the place and owns the place? How are we going to do a leadership transfer? How are they going to trust the next gen to lead? How are we going to move them into those seats and get them where they're trustworthy and competent? And all these people that can finish my sentences all through the building now I can lean on them and they've also got to lean into the next generation and carry this past me. There's got to be the legal transfers. We've got to figure out how we're going to move the actual ownership. We've got to have a brand and a reputation transfer. The vendors, the team, the customers, all three need to know how the thing is going to survive when the old lady dies or the old man dies or retires. How is Junior got the. Has the next gen got the chops to carry it? And they've got to see it happening. They've got to know it's happening because otherwise they assume it's not being worked on because most of the time it's not being worked on. Because most people's succession plan in business today is as they have a heart attack, grab their heart and fall back into the grave. They toss the keys out instead of gradually, intentionally, step by step, iterating into that succession and making it an intentional act of winning over a period of time. The brand transfer with us has been particularly hard and poignant because it's an emotional transfer because I am the brand or I was the brand. It was daveramsey.com was the mothership 36 months ago. We moved it to Ramsey Solutions.com. it cost us with stupid Google SEO for a while because they couldn't get everything moved. We did everything we're supposed to do, but we lost. Customers couldn't find us because they were all attuned into the other. The algorithms couldn't find us. The search engines weren't finding us like they were supposed to. It took about a year and a half for the stupid thing to catch back up to where it was, much less continued growth. We took a step back to get it out of my name. In 2021, spring or February, just a few months after the Fauci pandemic, we had had two Ramsey personalities on the air, one me and one other every day as co hosts for a while. And we decided it was time to change the name from the Dave Ramsey show, which has about 30 million listeners, viewers between YouTube radio and podcast, to change the name of the show. That's a big deal from the Dave Ramsey show to the Ramsey Show. We talked about it and I said, let's try something different. Let's just do it and not tell anybody and see if anybody notices. Because we've been working on these Ramsey personalities. So many of them are so well known. Rachel Cruz has had three, now four number one bestsellers. You know, Ken Coleman's had two number one bestsellers. John Deloney's had two number one bestsellters. So surely the. The tribe, our listenership is aware they're there and aware they're a big part of what we're doing and where we're going, that we're transferring the brand from me to them. So surely they won't care if we change the name. We changed the name without saying a thing except going on there and said, welcome to the Ramsey show instead of the Dave Ramsey show. Every hour. When we came on the hour air, you know who noticed me? Nobody cared. That was really distressing. It was pretty emotional for me. I got off the air and went, I've been planning to be less important and damned if it didn't work. Very intentional act to move the brand, to move the leadership, to move the ownership. If you don't do it intentionally, you're dooming the succession and the transition to failure. You better be thinking about it. If you're not working on it right now, you're already too late. You need to start working on it right now. It's part of your legacy journey, part of your legacy stage of business. This is where we are. So those are the five stages of business. They're not theory. They actually work and they're very hard to work through. I gave you some of our particular milestones as we went through them and you could relate to some of them. Some of the stuff is very hand to mouth, some of it's very primitive and some of it starts to get pretty sophisticated as you go along. That's the five stages of business. So you're working the six drivers all the time and that's what drives you to level up and meet these key problems and solve the key problems to level up and move through the five stages of business. It's exactly how it works. It's. It's the entre leadership system. It is not a theory. It's a proven observation of facts. It's been an extraordinary 30 plus years growing a successful business and teaching you how to do the same. We invite you to join us in the new year as we continue to build life changing businesses and lead people toward excellence. 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 listening to the Entree Leadership Podcast.