If someone consistently generates revenue for your company, that role should be commissioned—plain and simple. It defies common sense not to.
But what about all the other roles that don’t directly bring in revenue?
That’s where profit-sharing comes in.
In my posts How To Do Profit-Sharing and How To Do Profit-sharing Pt 2 , I walk through how to implement a system that actually works—one that motivates your team to decrease expenses, increase revenues, and in turn, share in the profit.
When your team starts thinking like owners—making decisions that drive efficiency and excellence—everyone wins. And when they see that effort show up in their paychecks? Now we’re talking buy-in, ownership, and accountability.
Real-World Application: Medical Practices and Referrals
Take a pediatric practice, for example. Cutting expenses is relatively straightforward. But how do you increase revenue?
By super serving your patients and their parents.
Every parent knows other parents. When they feel your genuine care, professionalism, and excellence, they will refer you—gladly.
It’s like finding a great mechanic or hair stylist—when you find someone trustworthy, you want others to benefit too. So what does that mean for your team?
Super serving = happy parents = more referrals = more revenue = more profit-sharing.
But Incentives Alone Aren’t Enough
Profit-sharing is great. But it can only go so far.
Your team also needs to know they’re part of something bigger than themselves. That they’re not just clocking in for a J.O.B., but doing work that matters.
When they understand that—when they’re connected to purpose—you’ll see a deeper level of engagement and passion. That’s when your business really starts to thrive.
The Missing Ingredient in Most Businesses: Execution
You can have all the strategy and ideas in the world—but without execution, your business will stall.
And what’s the main reason execution fails?
Lack of accountability.
When there’s no clear ownership of tasks, timelines, or outcomes, things fall through the cracks. But when you build a culture of accountability, you build a system where execution is expected—and it actually happens.
Not just for one week. But week after week.
The compounding impact on your business? Massive.
Many leaders think they’re missing the “big idea” when the real gap is execution through accountability.
Want to Create a Culture of Accountability That Drives Results?
If you’re serious about improving your team’s performance, alignment, and culture, our Team Trainings are a powerful way to get there.
These customized, coach-led sessions are designed to help your team:
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Communicate more clearly
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Take ownership and responsibility
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Improve problem-solving and collaboration
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Align around culture, expectations, and company goals
From Creating a Culture of Accountability to Fostering Unity, Personality Style Communication, and more—we’ll help you identify the lessons that fit your team’s needs and lead them through transformational training that actually sticks.
Question for you:
How are you currently incentivizing your team to care, take ownership, and get things done?
Let us know in the comments—and feel free to share this with fellow leaders who want more buy-in and less babysitting
Related articles
- How To Do Profit-sharing (Chris LoCurto.com)
- How To Do Profit-sharing Pt 2 (Chris LoCurto.com)
- Q & A On Profit-sharing (Chris LoCurto.com)
- Q & A On Profit-sharing Pt 2 (Chris LoCurto.com)
- Why You Must Hire Correctly! (Chris LoCurto.com)
As a business that has been in existence since June 2004, I am still growing and my model is changing with the merge of Healthcare Reform. There are days I feel I am back in Year #1. I give incentives to my employees in the way of gift cards to their favorite shops or things they could not afford (spa services) and like incentives. I do this based off of them completing projects early, accuracy and overall attitude at new projects generated from client requests. The employees that give it their all and are dedicated to serving Medical Account Solutions and their client base, have always received this type of “bonus” with awe and it has been met with gratitude. I am not in a position to give monthly profits because the business uses the profits to grow, not increase pay. However, I do want them to know they are greatly appreciated. I would love to hear others ideas and ways to generate buy in from their employees and ideas on how to generate a profit-sharing plan/model that works for you. And BTW Chris, as an Accounting person, I have tried to do the “math” from the post https://chrislocurto.com/blog/ but I don’t “balance” to your numbers and am lost as to how you “figure” this!
I think the commission system works well because it it a great incentive for employees to perform well. It increases the overall bottom line of the company and it increases the employees bottom line as well. In the economy that we are in right now it seems that not many people are receiving raises so a commission based program would certainly help people.
As a health care provider, I took some time to figure out just how to reward my staff for helping to increase my patient volume. I do like the idea of gift cards, but how does this person decide which card,for whom and how much.I did more of a profit sharing in that they had an hourly salary as a base and if we exceeded a certain amount of collections they would get a 2% of that ‘excess’ collection. While that doesn’t sound like much, considering they worked 25 hours per week, it could quickly add another $1 or 2 per hour for their efforts. If the numbers went down, I was covered and they weren’t working as hard, so I felt it was fair for everyone.
Greg, my business is a Medical Billing Agency and we provide various services that are not all based off of a percentage of collections, so making a profit sharing plan right now when employees are new, learning more, taking on new projects, etc this is the way I for now have opted to reward them and give them incentives until their pay will be moved to a base with commissions at a later date when my client base is larger and the employee knows more about the job, duties, customers and has more experience. I find commissions is a hard way to motivate during the training and implementation of usually a very messy client. I welcome more ideas because this may not be the best format, just the one I have used since hiring employees 3 years ago.
Sounds like it worked. What was the outcome?
Chris, This process has worked very well for my employees! I currently do not have full time employees, only part time, which means that their hours our volume and work load fluctuates regularly along with various training for the employees, this has been a welcomed way to be rewarded. I get a list from them of their favorite places to shop or if they had money where they would shop. I rotate between a few places and it has been received extremely well. They know that once they have “learned” the job and client I will be changing them to a base pay and commissions. I know this might not work well for everyone but it has worked for me!
I’d say if they’re happy with it, drive on. I like the idea! If they feel like someone is getting favored, then it’s a problem. One thing that just came to mind might be to have a selection of different, but equal value cards for different companies, so they can choose their reward. You don’t have to worry about whether or not they’re happy with your choice. They could even select it from a list, then you can go get it, so you don’t get stuck and everyone’s happy. Think ‘regifting’ and you’ll know what I’m driving at. Thanks for your reply.
The incentives I give my team are on closed business. BUT we have just implemented a system where the QUALITY of the file gets graded and could result in a reduced incentive! Because in our business – QUALITY does count!
Chris, thank you for this post, and all the related links. A friend of mine is in the midst of getting her business on to higher ground, and is strugling with the idea of doing some partneship. I convinced her profit sharing is the way to go, but couldn’t give her the exact details of how to do it. I promised to try and get her some info on the subject over the next two weeks. I’ll look like a hero when i send her this post tonight:), thank you, thank you!!!
NOOOOOOO partnerships!! 🙂 You’re a good friend!!
Well it worked pretty well until I found that she was goofing up the books and wouldn’t work with me on some changes. I wanted to put things on a practice software and go to seminars to improve the business. She didn’t want to do either even though I was paying her wages during the seminar, plus expenses, (motel, food, gas). She wouldn’t even do the recorded seminars with pay at her convenience, discussed her mother’s malpractice death with the patients at my front desk. Needless to say she’s gone and so are a lot of patients. Haven’t really found good help since, practice is floundering, working the Ramsey money model really hard to stay afloat and taking your blog suggestions to heart about service etc. Love helping people, not loving the business.
Chris, at my last company (JoVE), I wanted to do a profit-share that feels like equity and came up with a new model. I am now starting a company based on this model called FairSetup (www.fairsetup.com). The main advantage of FairSetup over existing profit-sharing models is that people are paid according to their impact, which makes the profit-share feel more like ownership. Furthermore, this form of profit-sharing does a good job aligning the sales teams with the ops teams.