My ego gets in the way sometimes. Maybe more often than sometimes.

Here’s a typical example. Lawyers all ask me (and probably you) questions like these:

Where do you practice?

Oh, I’ve got my own firm in Raleigh. You?

I’m in Durham, and I’ve got my own practice as well. I was with a firm for a handful of years and then struck out on my own. What kind of law do you practice?

Family law for us. What about you?

We do employment. It’s a lot like family law from an emotional standpoint—lots of client upset. How many lawyers do you have?

BOOM! Did you hear my ego kicking in?

How the Ego Leads Us Astray

I’m about to answer the number of lawyers question. That’s a question that pushes the trigger. Answering the question isn’t the problem. The problem isn’t what I’ll say next. The problem is much bigger than my answer.

The problem is the way I manage my business when I know that question is out there lingering in the air. Knowing that question is out there—just waiting to be asked—changes my behavior. That’s my ego doing its ugly ego thing.

That question is how we end up:

1. earning revenue of $950,000 with a team of seven employees plus yourself (that’s a sad revenue per employee of $118,000),
2. paying a group of employees used to easy days of screwing around on Instagram,
3. having three associates spending their days talking about what an asshole I am instead of working,
4. paying the associates more than we pay ourselves, and
5. feeling like we’re the only one doing any work while we pay everyone else to drink coffee and watch YouTube.

The ego drives us to add people we’re not ready to add from a business perspective. We grow headcount faster than we should.

Then, when we realize we’re overstaffed (or underrevenued), we justify it.

The ego tells us that:

1. We’re “poised for growth,” and a great team will be an asset once that happens.
2. These people were hard to find, so we should keep them.
3. We invested in training these people, so they should be retained.
4. They’ll trash us if we let them go, and we can’t take the reputation damage.
5. We’ll drive up our unemployment insurance rate and make it harder to recruit others if we terminate employees.

And the ego wins. We keep the team. We keep the low revenue. And it gets worse, not better. Everyone adapts to barely working. We don’t grow. We set lower and lower goals because we lack the funds to jump-start the business, and we live like this for a long time.

Resist the Call of the Ego

Our egos get fed by the wrong things.

If our ego were fed by profits, we’d be much better off. But profit isn’t discussed at most lawyer cocktail parties. The number of associates somehow serves as a proxy for profits. But, sadly, there’s no correlation between associates and profits.

Don’t let your ego get between you and the security of your family. Don’t let your ego jeopardize the financial security of your business. Don’t let your ego run the business instead of letting it be driven by the bottom line.

When your ego tells you to keep the employees, don’t agree. Don’t buy into the rationalizations that feed the ego while draining the bank account. When the business needs a bigger team, there will be a bigger team to hire. Until then, run the business on the real numbers, not the numbers your ego decides should matter.