Remember that your job is to be a multiplier for your people. If you can remove a barrier, provide a valuable new perspective, or increase their confidence, then you’re enabling them to be more successful.

Last, when it comes to the key people who absolutely drive performance, great managers/coaches simply do whatever it takes to keep them on board, including offering a customized compensation package. If one person wants less base and more incentive-based pay, so be it. If another wants more time off, let it happen. “Fairness” does not mean “sameness.” You need to be creative and flexible in order to keep your top talent happy, from a compensation-package perspective.

Wages are one of your biggest expenses and should be used strategically to differentiate your firm from the competition.

Our pet peeve is when a company’s leaders think it should grow regardless of profit. This is just reckless, unless you’re a venture-backed firm pioneering new territory. For everyone else, we recommend getting profitable with the work you have, proving you can get to 15% profitability (based on our adjusted Simple Numbers), adding labor to knock profit back

to 10%, and then growing to 15% again. Lather, rinse, and repeat.

We say “additional” because whenever management tells us there’s a cash-flow problem, we always start with fixing profitability, unless the company is broke and needs an immediate cash infusion to make payroll.

As Deaton and Kahneman wrote in their study, “More money does not necessarily buy more happiness, but less money is associated with emotional pain.”

At lower levels of income, money brings tangible benefits that are necessary for survival, safety, and a sense of control. But at slightly higher levels of income (and this needn’t be $75,000) the meaning of money starts to become somewhat more abstract and becomes about other things, like status and pride.