'HR Wasn't Something I Really Gave A Crap About,' Says Dave Ramsey. 'In Corporate America, Everybody Is Scared Of HR. They Bow To Them'

Personal finance expert Dave Ramsey admits he didn't see the value of the human resources department early on, but says bringing in the right person at the right time made a big difference in how his company operated.

“HR wasn't something I really gave a crap about, except as long as we got the people on and got hired and got the work done,” Ramsey said in a recent episode of the “EntreLeadership” podcast. “I’m an entrepreneur. Leave the cave, kill something, drag it home.”

“In corporate America, everybody is scared of HR. They bow to them,” he said. “Management is scared of them in a lot of cases. So, you don’t want that.”

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At $10 Million In Revenue, It's Time To Get Help

The conversation started when Jason, a business owner from Salt Lake City. His company has around 80 employees and made just over $10 million in revenue last year. He asked if bringing in an HR person would help him grow and run the company more effectively.

Ramsey said Jason was at the perfect stage to start thinking about HR and finance hires. “That was the level we brought in our first HR person and the level we brought in our first [chief financial officer],” he said.

Ramsey admitted that early on, he just wanted someone to “count the money and pay the bills,” but eventually he realized that dedicated people thinking full-time about HR and finance actually made the business run more efficiently.

“It does cause the business to run more efficiently because it lowers the number of mistakes you make,” he said. “But number two, you can maximize some of the investments you're doing.”

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The Right Way To Use HR

However, Ramsey warned against copying the way big companies use HR departments. “What you don't want is corporate America crap… They are there to serve the company, not the company serve them,” he said.

At Ramsey Solutions, the HR team helps with recruiting and benefits, but doesn't own the hiring process from start to finish. “They'll do the initial interview, they’ll do the recruiting, maybe even a second interview, and then they'll sit the person down with what we call the hiring leader,” he said. That hiring leader then decides if the person is a good fit for the team.

Ramsey emphasized that HR should make things easier for the team—like managing benefits, scheduling flu shots, or helping people sign up for 401(k) plans. But they shouldn't be flexing power or slowing down business.

“Their job is not to be running around flexing,” Ramsey said. “HR is here to make life better for everyone and easier for everyone when it comes to the human resources.”

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Who Should You Hire?

Jason asked if Ramsey went for someone with tons of experience or someone new but eager to learn.

“To answer your question, the one we hired was a guy named Rick Perry,” Ramsey said. Perry had worked at Procter & Gamble for years and understood what not to do in a smaller company.

“He helped us a lot with our recruiting processes, our hiring processes, with things like job descriptions,” Ramsey said. “We were just kind of loosey-goosey. He helped us with our excellence.”

Rick ended up staying with the company until he retired and remains a close friend.

Ramsey told Jason that if he does bring someone in, he should outline exactly what that person should and shouldn't do. “You’re not taking over our company. You’re just gonna be helping us with these things.”

He also gave similar advice for hiring a CFO. That role, too, should exist to support operations, not block them.

Jason received plenty of praise from Ramsey before the call ended. “You’re doing a good job, Jason. Congratulations. $10 million, man. 80 people. You’re a stud. That’s awesome.”

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