Why Do You Pay What You Pay?

[Music] hello everyone welcome to the 21 hats podcast I'm your host Lauren Feldman this week Paul DS Jay goz and Sarah seagull talk about where the dust has settled after years of turmoil in the labor market as you know all too well we've been through covid supply chain issues inflation labor shortages the great resignation minimum wage hikes new pay transparency regulations and countless rumors of recessions that have yet to come all of which has had an impact on wages and that's why I decided to ask Paul Jay and Sarah where their thinking has landed the consensus here is that Leverage is Shifting back to employers but Paul for one remains committed to paying his people more than they can find elsewhere it's worth it to me to have the team I want he says and sure it affects profitability but turnover affects profitability too and I'd rather not have that plus we also talk about whether Lululemon was right to fire two retail employees who tried to stop a robbery and we answer the following listener question if some is not working how do you know when it's time to walk away even in Good Times owning and running a business can be a lonely Pursuit our hope is that these weekly conversations brought to you by a principal sponsor the great game of business will let owners know they are not alone in facing challenges same thing with our daily newsletter the 21 hats Morning Report when Jake magazine named the best newsletter for business owners and which you can subscribe to for free at 21 hats.com where you can also find transcripts of our podcast episodes and lots of other articles and interviews joining me this week on the podcast are regulars Paul DS who is CEO of Paul Downs cabinet makers which makes custom conference tables outside of Philadelphia Jay goz who's CEO of the gos group whose companies in Chicago include a picture frame business artist frame service and a home furnishing store Jason home and Sarah seagull who's CEO of seagull Communications a public relations firm based in San Francisco the episode is titled why do you pay what you pay [Music] welcome Paul Jay and Sarah it's great to have you here I want to start today by talking about employee compensation as uh as we all know we've been through a lot of turmoil the last few years you know covid inflation the labor shortage the great resignation all things that have had an impact on hiring and and wages I'm sure I left something at yeah there's five things that have changed covid inflation labor shortage minimum wage changes and the fact that people are now posting how much money you make in ads that we didn't used to do pay transparency yeah all right whether it was forced or not it's become clear that it does help your response rate so yes that's a lot is right so I guess my question is you know why are you paying what you're paying and are you happy with where you landed maybe Paul start with you why am I paying what I pay I tend to pay high because it takes such a long time to train my staff that I don't want them going anywhere so that's been true for a while I I assume well before Co yes that's always been my strategy which is I don't want people to have a better situation that they can easily Waltz into and including pay when you say high are do you have a set percentage in mind over what you think is the market rate not really it's mostly are they are they making $25 an hour plus in total compens ation which I think of as kind of a baseline for being able to survive in this uh in my area and then some employees May considerably more than that and those are the ones who are professional degrees or whatever and they have options they could go get another job anytime so I focus on staff retention and part of that is pay and part of that is just providing a good working environment that said yeah I had to give a bunch of people raises the last few years people just come into my office and say want to race up I think part of the key in your case is part of your business model is you're selling a premium product which is why you can afford to pay more because you're giving a premium product it all makes sense yeah you're not selling a commodity exactly it's worth it to me to have the team I want and it sure it affects profitability but turnover affects profitability too and uh I'd rather not have that Paul when somebody comes into your office and says I want to raise B up do you give them the raise or do you make them go get an offer no no no I don't want anybody looking around uh usually I give them a raise yeah because generally there's a reasonable case to be made for it often I hire people and a year later the ones who are really good they're like hey I'm good I'm like yeah you are here's some money so there's no huge calculation on my part as to exactly what it'll be but one thing I am do keep careful track of is what their total compensation works out to in pay per hour like if you roll in all the cost of the health insurance and everything that we do I've got a spreadsheet that divides all those numbers into the number of hours they work and I can say to them okay you're only getting paid what you think is 20 bucks an hour but I'm covering health insurance for your wife and three kids and that's another 11 bucks an hour so surprise you're actually making 31 it's just that some of it is in a form that you hate wait the question Paul is so how often are I assume from knowing you I think you try to stay ahead of this and you're trying to pay appropriately so I'm sure this happens but it doesn't happen that often does it because you already are staying up with it I mean this isn't a monthly event yeah I would I would say actually that the proportion of times I have simply given people money as opposed to them asking for it is maybe 3 to one like for instance you hire someone and you have to think about okay well I hired this guy needed to pay him X to get him in the door do I need to recalculate some of the other people in that case just to be fair I mean that's that's a pretty common scenario and then other times there might be someone who's shy and just is afraid to ask me and they're doing well and I'll be like hey it's been a year what do you want seriously what do you want yeah okay let me just give a warning to everybody listening to this the things I do you probably should not do because I I really I really am am biasing the whole thing towards staff retention and investing in people over a series of years because that's how long it takes to train people up and so no I'm I'm not doing a lot of things I I'm sure Jay has a completely different Playbook I wouldn't say completely different but you'd be correct different in that you are truly dealing with skilled labor and I'm dealing with semiskilled in some cases and unskilled in other cases so I fully understand what you're saying that in your case you've got skilled labor that takes you years you really can't afford turnover in my case I can afford a little turnover and so it's not but but it's also not 180 degrees in what you're doing I also have very low turnover my turnover is probably 10% so yeah mine's less than that right I only had one employee leave after covid voluntarily and that was because he just got tired of the commute and so he found a job that was closer to home and it's too bad because he was a fantastic engineer and we miss him uh we were able to replace him but money wasn't really the the issue at that point I would have given him more money but I couldn't find a way to not have him spend 45 minutes in a car each way traffic is amaz I got to tell you traffic has become a major factor in employment these days absolutely Jay don't you have somebody who like has a commut like a hour and a half each way yeah and he's been with me for 25 years and he's a critical person and I'm tight with him and he's totally with me on the whole mission but yeah he drives a long time that's crazy but makes a sixf figureure you know he's a six-figure guy you know this isn't a 40,000 figes because that's that's still an incredible that's 1,500 hours a year yeah let me add a piece to this that I don't think either of you have to deal with which is minimum wage in 2014 the minimum wage in the City of Chicago because there was no special minimum wage for Chicago versus Illinois was $8.25 and as of next week the minimum wage in Chicago is now $15.80 which means it's gone up 91% in nine years which is about 10% a year that does have an effect on things and it's what's caused what I call Labor compression which means the spread between the top person and the bottom is not as much as it used to be and part of it is simply because when you think about it if one person can frame whatever 10 pictures a day and the other person can do five one could say oh well they should make twice as much that doesn't really work because at the end of the day everybody has rent to pay and has food to buy which is why I fully support minimum wage and it's compressed though meaning maybe at the bottom they're making $3 an hour more but that doesn't mean it went all the way to the top and that has to be factored in tell us about the impact that that increase had on you specifically did you were you paying many workers the minimum at that point I've been clo over the years close and I've definitely had to build that into my cost of doing business I would say this I just lately had a case of every one of those five things I mentioned have had a profound impact you put them all together that's a lot of moving things and I have had to sit down and think all right what is our starting weight going to be what is the marketplace we put ads out there we're not getting a lot of response there's less employees so we just had a situation that somebody came to us and complained that we've been trying to find someone for a particular position and now we're putting it in the ad we raised how much money we were offering and she goes that's almost what I'm making and I've been here for two years and you know what she had every right to be upset and we talked about it and the fact is we gave her a raise and we're going to give other people in that department raises so part of my my feelings on this is I feel good that she felt comfortable coming to say something and she didn't just quit and we apologized we said you know what we didn't react quick enough to the changing dynamics of the marketplace we fixed it she's happy we're happy but we did get caught a little bit you know on our heels with that because we didn't change it quick enough because it's definitely affected the marketplace especially the fact we're putting it in the ad now how much we're paying which we never used to do are you required to do that Jay I don't believe it's become a law in Illinois yet but here's the big but but I keep reading that keep they keep doing studies you do get more respondents when you put it in the ads so we're going with the flow and we put it in there and I think it's true you also get less tire kickers because they can see what you're paying and they're not going to bother if it's not the you know what they're looking for where are you in terms of your salary ranges for your positions did you increase them over the last year no absolutely we because of inflation we probably did 5 six% which we haven't done in many many I don't know we have ever done that inflation's been next to nothing for years we were we were good with two or three percent so we definitely gave a bigger raise I don't think it's going to continue to this year but time will tell when you're asking about the range sorry you mean like I pay from 40,000 a year to 110,000 a year or something like that per position so like if you have somebody who's like a sander I don't know what you have but like last year your starting salary for that position was $35,000 no most of those people we're they're making in the mid to Upper 20s per hour with some variation on what their benefit packages because we offer to cover uh employees whatever dependence they want to bring we pay for part of that do you think that we're in an employer's Market or or an employees market right now I think it's evened out I think it's not quite as as employee as it was but it's not 2009 that's for sure right I think it's in between well here in California I definitely think it's migrating entirely to an employer Market because I mean I look at my LinkedIn feed and like you know open to Opportunities and you looking for jobs is like every other post at this point um just because we've seen so much of the tech stuff imploded um here on the West Coast I increased my my salary ranges last year and it wasn't for inflation but it was for getting people to apply I will tell you that this quote unquote problem is an opportunity because some of your competitors some of my competitors are knee- jerking and not giving any raises and it's pissing people off it's an opportunity to get some good employees who their bosses have gotten shortsighted and forgot the quote unquote greatest asset is their people and I do think it's freeing up some good employees that that might not have been looking before which is what I think you're saying agency side's a little weird though when you're a boutique agency like me is that I can't compete with the big guys like in terms of their their salaries I I just can't right and I'm surrounded by tech companies that are hiring people straight out of college at six figures you know I I cannot compete with that so really what I have to offer is is the full package is the we will really have a respect for people's work life balance we really have a great PTO plan I think you're right but the fact is that is competing but but the fact is you might not financially be able to compete but you are competing and I'm in the same situation I'm quite you were here a couple weeks ago I had I had two different employees tell me they had job offers from major retailers in the United States that came to work here because they want to work in what I call a collaborative environment they want to matter and they don't want deal with the corporate politics and stuff we can compete out there there are people out there now that will give up money for working in a nice place and to your point the hours thing some of these people I I brought back somebody who was making 30% more at one of the big company they were just killing them 60 70 hour weeks every week yeah I'm small enough we like we have summer Fridays and nobody puts out of offices on summer Fridays if there's something urgent we respond to it but like if a team member is is going to be out and they don't have anybody to cover because their partner in crime is at a conference or something like that I'm like I'm here like I'm I'm always a person that people can call because I never put out of office but like because I want people to be able to disconnect and people to go off off the grid and really kind of have that opportunity to get refreshed and motivated and inspired by life um but corporate you don't really do that as much no and there are plenty of people out there that value that more than money so Sarah when when you raised your wages last year how did you figure out the the number where you settled well we're lucky in that we are part of a number of different professional PR organizations one of which uh is really great about um doing surveys uh where people provide you know transparency and what they're offering people and we also look at what other people are offering you know there's more and more companies um are posting the range at least and so we we just we bumped it up by you know a small percentage um but it just makes a little more competitive but you know part of me is like inflation is going down um the job Market's becoming more tough I'm thinking maybe later this year like I can reconsider those increases um depending on what things look like because honestly like I I think I'm paying somebody out of college way too much um I mean I made peanuts when I went out of college but it was a great job and it was a cool opportunity and I loved it it wasn't about the money Paul I want to go back to that conversation you have where you turn your to your employees and say how much of a raise would you like I'm curious do do you get realistic responses do are you often able to meet their request uh how does that go you know what you do that with people who are afraid to ask for raises so they're generally delighted that I've recognized them and I rarely get an answer back and so I'll say how about X and they're pleased as can be I don't think people are greedy I think when you ask a question like that you know someone's not going to look at you and be like I want $10 million a year they're going to look at what they do and give an appropriate answer um I I just think human nature people aren't going to most people won't do that well the other thing is just as a basic negotiating tactic it's better to get the other person to name the first number well I was going to say what if they ask for less than you were prepared to pay what do you do depends on what they ask for but um sometimes I give them more that particular conversation often happens at the point where I'm deciding to hire somebody and I'm interviewing them and I say what do you want you know what are you looking for and uh if I want to hire hire them they tell me X and such dollars an hour I'll say listen I'll do X+ one I want you to accept this job right now though I'm going to take you off the market because I want you to work for me he's watching too much Shark Tank that's the problem well you told us that a while ago when the labor shortage was was ACC are you you're still doing it well yeah it is a tactic that's predicated on the employees in charge labor market and when the time comes that we you know we flip back the other way I may rethink it or I may not because I found that I think that it's a it's a it's a statement of faith and a statement of the kind of relationship I want to have with my employees at a moment when for the person who's thinking of joining us there's it's a big risk they don't know what they're walking into so if the boss is right there saying I think you're going to be great and I want to give you more and I have faith in you and what the next thing I say to is okay I'm going to pay you this and uh and if you if you turn out if I'm mistaken I'll get rid of you and so it's on you now that there goes that Goodwill well no it's just being honest it's just like I'm not going to let someone take advantage of of me but I will if I but do you need to say that to them do they need to be told do you actually use that language or do you say listen if it turns out you're not worth it it's not going to be working for either of us and you're probably going to leave no I say I'm going to give you we're going to give you all the support we have written down new employee guidelines that tell them exactly what they need to do and I say we're making an investment in you but if it doesn't work out I will fire you it won't last long so first thing show up act interested and and I I just give them what's going to happen I don't I don't like to sugarcoat stuff or be vague about something which I have in my mind as a possible course of action and I've had as far as I know very little negative reaction to that because again it's it's establishing a relationship an honest relationship right from the get-go there's also a benefit to that that if they end up coming in late you can go you know what Bob I made it perfectly clear when I interviewed you that that wasn't going to be an acceptable thing like I do think it's fair to tell them the way the deal is so they know what they're getting into like if you have a hard time getting up in the morning this isn't the right place to work yeah that is PL and fair well we have a policy of flex time just to handle that that's part of what we tell them is like okay whatever you got to do in the morning to get your kids to school whatever figure it out we just want you to figure out when you can be here and then to be here consistently that's the policy I think that your policy it works well in for certain industries but like I don't think I would ever Implement that in a Professional Services industry because I don't want someone coming to work for me just for the paycheck well you're not hiring Blue Collar then cuz that's a whole different game yeah I'm not it's not about the it's not about the the hourly rate it's about the opportunity what I can teach them what they'll do like all of that kind of stuff and yeah the pay should be fair but the opportunity should be awesome and in your business there's a huge difference they could come to work for you and really learn the industry and the business and get involved with different aspects or they could go to some bigger place and have just one job all day long so I think that's a huge difference it's a huge difference like I talk to people that have worked for like the the huge Clinger and like their entry level people are like building media lists and taking you know inventory of coverage for clients and getting coffee but they're not even on client calls they're not you know they're not doing anything like I don't care what your title is if you want to try something like for sure generally in most um PR businesses to do new business and start with like putting together proposals need to be a like a director level if not vice president level I brought a junior level person on a call with me with a Restaurant Group um this week and just you know so she could take notes and listen in she's really good at a certain aspect of of grand openings and and restaurant um PR and so I thought it'd be good for her to kind of listen to the conversation and got off the call and I was like do you want to take first crack at putting the proposal together and she looks at and she goes like that was going to be my cute three goals like I would love to do that I'm like go for it that's a huge Advantage for them to take a job with you in my business just not cutting their hours is a huge Advantage there are places like mine that if business gets to low they think nothing of saying oh you'll have to take off Thursday and Friday and if their hours cut I just had someone leave who was complaining about how much money she made and the fact is we just looked at her LinkedIn connection she went to work for a company when you Google it they only hire Freelancers well I can assure you that her hours are going to be these people need to pay their rent and like when we get slow even if we don't have a backl we find stuff for them to do because we know they got to pay their rent and that's a huge advantage to someone who works in a factory so it depends on what business you're in but those extras are not in the ad necessarily are not but you know to be able to make a proposal with you that's worth a zillion dollars to not be laid off on Thursday and Friday is worth so it depends what business you're in but we can all as small business owners offer them some real advantages that are valuable to them we're seeing a large trend of people that have been freelanced starting to go back for full-time jobs because of that inconsistency where they want to be able to have the reliability of a paycheck I want to hit a couple more topics uh before we go Paul we've been tracking the time and money you've been investing in a marketing campaign you recently introduced uh a new website that you'd been telling us about are you happy with it yeah so far I mean nobody's seen it yet but uh I saw it well well okay we have not made the connection to our target market yet but everybody who's seen it says it looks nice I realized it's missing some some information so I'm going to be building it out over the summer our first real event where we're going to be trying to meet people and get them to use the site is in the fall so wow uh there's still content to be put in but I'm pretty happy with it happy with the process I looked at it I think it looks great if I was looking for a custommade conference table I don't know why anybody would go anywhere else I think you hit all the points Paul how much did you spend on your new website oh I think that the the money I paid to the web guys was something on the order of 22,000 bucks and uh the amount of time I put in Priceless right so what about the photography the photography some of it came from the bow string a different Media company that we engaged and I think that cost me maybe 35,000 for the entire package which included some photography but had a lot of other stuff as well it's a good investment I hope so it's it's actually cheaper than hauling conference tables around to Furniture shows which would be the other way to meet people I didn't ask that question by accident I know that photography is a critical p and this isn't obvious to most people I had to learn it photography is a critical piece to having a a greatl looking website and I knew that wasn't going to be cheap the photography was part of a package of services that included sort of strategic thinking the uh market research including interviewing the target market and uh developing various uh campaign strategies and photography was maybe half the cost of that but what these people could do that we can't do is come in and take really nice video and uh and so they spent a day shooting in the shop and I used a fair amount of that content in the site I also shot a lot of video myself and it's surprising how much you can get done with an iPhone these days but it's not nearly as beautiful as the as the video they shot so I featured that on the homepage and a couple of other places did you learn anything anything surprised you in the process um I guess the most surprising thing was was something that happened when they showed up to film which is in the world of video uction there's a fairly large number of people involved who seem to do nothing all day and uh they they're just standing around you know like getting a cup of coffee or whatever and to my workers it was like what are those people doing are we paying for that and I'm like yeah we are but that's I know exactly what you're talking about that's kind of how it goes no I also look at this and I'm thinking really what are all those but I'm sure they're doing something I'm not so sure they're doing something cuz they sure didn't look like they were doing anything but it wasn't my thing to to try to reinvent the way video is produced so I just said okay shrug Paul yeah I think you said that there's an event in the fall that you're tying this to what's the event yes it's sort of like a show except it's not quite a show what it is is we're trying to Target a very discret group of clients with this new site which is high-end corporate Architects and interior designers and this event is actually a kind of a a get to meet these people where a company identifies the top people from the client side The Architects and interior designers and I presume either pays them or offers them some goodies to show up at a a resort in in San Antonio for a weekend and then me and other people like me pay some pretty big money to sit down and have half hour conversations with I think we're booked for 20 different people wow like speed dating it's sort of like speed dating slow speed dating but it's getting around all the defenses and all the and just getting right to the people we want to talk to and I've been talking to this company who runs the event for four years now and we were just about ready to do it in 2020 believe it or not and uh then that went down the down the tubes for a while but uh I have limited number of places that I can consider to meet my target audience there just aren't that many shows and the and the the big furniture Industry Show uh J assist in Chicago last week it's an enormous production and it would cost me 100 Grand to do it so I'm willing to spend I think I'm in for 21,000 for this weekend and then we're going to devote a lot of resources to the followup and making sure that we are putting physical objects in these people's hands every few months from there on out because I think that's the only way to actually make an impression these days now my marketing firm had thrown out a a digital strategy where you start with just ad buys and try to zero in and get the target audience to call us and I'm going to try that but I don't have much faith in it because I think you're starting with too broad a funnel and uh so yeah that's what I'm doing all right I want to uh I want to talk about something that's been in the the news recently which is that two employees of the Lululemon uh retail chain recently tried to stop a a robbery um and in return for doing that the store immediately afterward fired both of those employes which produced a big public backlash it kind of became a bit of a PR nightmare people were outraged at the store would fire people who tried to save it money the company doubled down afterwards and said you know they didn't do what they were trained to do so we fired them I'm curious if you guys have any thoughts about that oh I'm I'm not surprised I mean most companies um retail companies have it in their policies that you are not allowed to run after anybody walking out the doors Apple very well known for that and there's a huge epidemic of Smash and grab um here in the in in California at least um and it's a bigger liability for an employee to be trying to um police um that kind of thing than it is is to just let the people take the the items out so I mean they violated probably company policy and they lost their jobs because of it and honestly they have to protect themselves because of that like yeah it's a PR nightmare because people like oh they lost their job because they were trying to do the right thing this and that that's the problem that's the problem it wasn't the right thing the problem is they're trying to save people from getting killed in their stores and this policy wasn't just made up for nothing they they have the responsibility of protecting the lives of all their employees they made a policy with that in mind and these people decided they knew better and you know it's a problem now the question is was it crystal clear to these employees did they absolutely know should they have suspended them perhaps instead of fired them for the pr angle but I certainly can understand where if somebody would have God forbid got shot and killed then it would be all over the news what terrible management is look at they had their so like you know they're trying to they're trying to protect their employees and I can understand why they fired them um it's unpleasant but uh that's tricky I'm just going to throw something out there though which is that I don't disagree with what either of you said and if I had to write a policy for my employees in retail it would be the same policy it's it's simply not worth anybody getting hurt over a couple of shirts or whatever it is however the flip side is that when it's it's absolutely crystal clear in policy that nothing's going to be done you're inviting a lot more theft and it's difficult for people to feel like they're part of an organization that's telling them hey people can come into your place of business where you work and do whatever they feel like and you're not allowed to do anything about it it's very corrosive and I don't think there's a simple answer because really the police should be on this but clearly that's not happening so when you see a rising tide of just disorder and crime sweeping through the whole country it's very distressing for people it's distressing to hear about it it's distressing to watch it if if someone came into my shop with a you know and started stealing stuff it would be horrible thing to watch very difficult to to to feel like oh why would I come back the next day anyway you know like my bosses are saying it's a free-for-all here people can do whatever they feel like so so would it have been a smarter thing for them to send out a memo to every employee saying that this is what happened we have a policy this is why we have a policy and while we appreciate the well-intentioned efforts of soand so we can't emphasize enough this can't happen again and then not fire him would that have been smarter perhaps probably everything about that incident sends a message to the current employees which is we we care about you in a way that's only self-serving now words we don't care about your state of mind we care about the company wa it's saying we want you to stay alive I think that they make it pretty clear the only reason they want them to stay alive is because they want to they don't want to pay for the consequences like if they were really interested they would hire security right this is probably not the first time it's happened other employees probably tried to stop shoplifters and you know they made an example of these two people okay I'm curious those two people are now on the job market if they showed up Jay at your door and said hey I got fired cuz I gave a damn about and okay I may have made a mistake would you see that as a positive or A negative first of all I have I would ask them did you know what the policy was what were you thinking I would certainly have a conversation the statement from the company was that they knowingly broke the rule I think the it's a serious point to be clear it's not that it just happened when you think about it this literally has to be happening every week if not every day they have stores it's not this isn't a one a year it must be happening every single day what we don't know is how clear did they make the policy how reinforced it is that we don't know and that's why I'm not playing judge and jury I'd want to hear more details on did you know the policy what were you thinking when you did that blah blah blah blah blah was it a kid that you could clearly see didn't have a weapon I mean so you might hire the employees that maybe maybe maybe people are allowed to make mistakes and judgement calls like the person this is not going to live with them forever in terms of their career opportunities at least it shouldn't but you know the company had the absolute right to enforce its policy even if there was an option of just giving them a slap on the wrist I bet you anything they've given a hundred if not thousands of slaps on the wrist for similar things and they finally were just like listen if we don't do what we're say we'll do when people do this it's going to keep happening and it's a huge liability that's going to cost him so much money if anything would ever go wrong that's all true but the only problem with it is they were trying to do something for the benefit of the company and that's what really just ouch and now I will tell you you know what I have an example of what's happened to me I once had someone working for me they would get in fights with customers because we didn't do that and I'd go don't fight with a customer over $50 just smile and take care of it and this individual could not stop themsel from doing it and I finally we had to fire the person because you know at some point even though they were well intentioned we know what a liability that is so that's why I say I'd like to hear the entire story a little more detailed how many times were they warant now would it maybe been smarter to suspend them for a week and say why don't you take a week off and decide whether you can work in an environment where you will be able to control yourself if this happens again would that have been smarter I would think probably but s your point Z maybe they already tried that I don't know if you have rules in place and you don't enforce them then people are going to consistently go around them or break them and it weakens The credibility of your business for example like we have we have policies where we don't work with jerks recently I had to have a a offline conversation with the client and basically say you know we're going to drop you um if if things don't change CU you can't be sending those kind of emails to my employees um if you have issues with anything we're delivering you can call me up here's my phone number and they stopped if we had left them um they would have been in trouble because they had a big you know thing coming up that we were supporting them on and they didn't have time to switch horses so I had the you know leverage there but you have to enforce the rules the problem with being in business is what defines a jerk to you is not necessarily what defines a jerk to me me like there's some black and white they grab someone's arm okay done they say what kind of is this with okay I don't call that abusive they call them you way worse okay there's a line there so it's not always black and white we have just a minute or two left I want to get to one more question which is a reader question I thought was a good question the question is how do you know when it's time to give up on something a project an expansion a business whatever it might be anybody got some advice I've held on too long for sure and I think you have to say to yourself if I knew what I know today what I have done this and if you say probably not it's probably time to pull the plug on it you're talking to someone who's spent six figures that I shouldn't have that I should have realized this wasn't going anywhere and I just kept into my oh I'm gonna fix this thing and it was delusional and uh I think I've gotten better since then I would say that there's two scenarios that I I experienced one is just a project I'm trying like this whole marketing thing I'm throwing a ton of money at it I don't know whether it's going to work and if it doesn't I'll stop throwing money at it the other one that comes up all the time though is whether you should get rid of an employee who's trouble and almost always I found that in the first Decades of being a boss I was too slow to do it and now I know what to watch for and I'm quick to do it I've learned that when you start questioning it it's time because I played the game literally 50 times oh I give it 50/50 I have never won that bet never not one time did this person all of a sudden oh my God look at that was a good gamble they ended up saving them never has happened so I believe in two things one follow your gut if your gut says no then drop it like your your gut is the mo your intuition your gut is like the most powerful thing and the second one is if you're starting to feel physical stress because of a situation where you're you know your neck is tight you're anxious you're like causing you a physical impact it's probably whatever you're doing it's not worth it and I want to publicly say that my gut has been wrong many many many times so it takes a long time to get a sophisticated gut but every good thing I've ever done and everything bad thing I've ever done has come from my gut so it did take me a long time to develop the skill set with the employee this is easy here's my best one if the person came into marrow and quit would you be relieved yeah that's a good yeah that's that's good yeah it works and I've used it myself even I'd asked my manager what listen if she quit tomorrow how would you feel uh and then that's really the greatest gut check because your your your emotions know that it's time for for it to happen that can be like projects like if the project all of a sudden was taken off your plate would you be bummed out or would you be relieved and if you're you be relieved then maybe it's time to WP WRA that up the worst misquoted quote ever is Winston churel never never never never give in they left off the other half which unless in good judgment that's a bad thing to live by sometimes it's time to move on there's no question sometimes it's time to move on it's time to move on right now nicely played Lauren nicely played my thanks to Paul down Sarah seagull and Jay goz and to our sponsor the great game of business which helps businesses use an open book management system to build healthier companies you can learn more at Great game.com thanks everyone wait wait don't leave yet if you have a question or a comment that you'd like the 21 hats owners to address send it to me by replying to your Morning Report or by email at Lauren 21h hats.com that's l r n21 hats.com do it now before you forget and don't be afraid to tell Jay what you really think you can take it and if you got something out of this conversation help us reach more business owners tell a friend subscribe and review us wherever you get your podcasts follow us on Twitter subscribe to the morning report at 21h hats.com this episode was produced by Jess Theron founder of blank word Productions okay now you can leave thanks for listening everyone [Music]