Profit is a Team Sport: What the Great Game of Business Teaches Law Firm Owners (Ep. 177)
Many business owners believe that profitability is their responsibility alone. They make the financial decisions, monitor the numbers, and carry the burden of ensuring the business remains profitable. But what if that mindset is actually limiting your company's potential?
On this episode, I explore a powerful concept: profit is a team sport. When every member of your organization understands how the business makes money and how their role contributes to its success, they become active participants in driving growth instead of just employees completing tasks.
The Hidden Cost of Keeping Financial Information Private
For many organizations, financial data is treated as confidential information reserved for owners and executives. While there are valid reasons to protect sensitive details, keeping your team completely in the dark can create unintended consequences.
When employees don't understand the financial goals of the business, they often lack the context needed to make decisions that improve efficiency, reduce waste, or create greater value for customers.
Without visibility, it's difficult for people to connect their daily work to the company's long-term success.
From Employees to Business Partners
I adopt the principles of open-book management which is a leadership approach that encourages business owners to share meaningful financial information with their teams.
The goal isn't to disclose every financial detail. Instead, it's to help employees understand:
How the business generates profit.
Which financial metrics matter most.
How their individual actions influence those metrics.
Why certain business decisions are made.
When people understand the score, they're far more likely to help improve it.
Focus on the "Critical Number"
One of the key ideas discussed is identifying your business's critical number.
Many owners focus heavily on revenue, but revenue alone doesn't tell the whole story. Every business has one metric that represents its biggest opportunity or greatest challenge. It might be utilization, client retention, operating margin, collections, or another key performance indicator.
Once that number is identified, the entire team can work together toward improving it.
Instead of guessing what success looks like, everyone has a shared objective.
Transparency Creates Ownership
A common concern among business owners is that sharing financial information could create unnecessary anxiety or lead employees to misunderstand the numbers.
I argues the exact opposite of that assumption because I believe transparency builds trust.
When employees understand why decisions are made and how success is measured, they become more engaged. They begin identifying inefficiencies, suggesting improvements, and taking greater ownership of outcomes because they understand the impact of their work.
People are far more invested when they know the game they're playing.
A Simple Change That Increased Profitability
I also share a practical example from the experience in my firm.
A financial planner pointed out that she was spending valuable time on administrative work that someone else could handle. By hiring an assistant and delegating lower-value tasks, more time became available for her to focus on higher-value work that directly contributed to business growth.
The lesson was simple but powerful: profitability isn't always about working harder. Often, it's about ensuring the right people are doing the right work.
Five Ways to Make Profit a Team Sport
If you want your business to become more profitable, consider these practical steps:
Identify the single financial metric that matters most right now.
Share that metric regularly with your team.
Explain how each role influences the outcome.
Encourage employees to contribute ideas for improvement.
Celebrate and reward progress when the team moves the number in the right direction.
Conclusion
Building a profitable business doesn't have to be a solo effort. When business owners create financial transparency and help employees understand how their work contributes to success, they foster a culture of accountability, collaboration, and continuous improvement.
Profit isn't generated by one person rather it is created by an entire team working toward a common goal.
The question every business owner should ask is: Does my team know the score, and do they understand how they can help us win?
Resources:
Profit First - Transform Your Business from a Cash-Eating Monster to a Money-Making Machine by Mike Michalowicz (Book)
The Great Game of Business: The Only Sensible Way to Run a Company by Jack Stack with Bo Burlingham (Book)
Law Firm Financial Reporting Template Pack (Exclusive content)