The SIMPLE Managerial Framework That Changed My Business Ep 423

Summary Notes


In this episode, Alex Hormozi from shares insights on effective management and communication within a business. Hormozi emphasizes the importance of attacking processes, not people, to foster constructive conversations with employees. He introduces a triangular framework for diagnosing why employees may not be performing tasks, which includes checking if expectations were communicated, if proper training was provided, and if there is sufficient motivation. Hormozi stresses the significance of documenting communication, repeating it, and ensuring tasks are reported on regularly. He also discusses the need for managers to provide clear reasons for tasks to align with employees' understanding of their purpose. Hormozi's ultimate goal is to help entrepreneurs scale their businesses by maintaining the basics, even as volume increases, and he encourages sharing the podcast to support other entrepreneurs.

Summary Notes

Diagnosing Employee Performance Issues

  • Alex Hormozi emphasizes the importance of addressing the process, not the person, when diagnosing performance issues.
  • He suggests asking employees whether specific factors are causing the issue, which avoids personal attacks and focuses on the process.
  • This approach is part of effective management and influences employees in a positive way.

"When you're trying to diagnose a situation, if you're asking an employee, and I'll give you, like, some of the scripting around this, at the end, it's like, hey, is it this? Like, I've noticed you're not doing this thing. Is it this, this or this that's causing it? And then you're not attacking the person. You're attacking the process, and it makes it much easier to talk about."

This quote explains a non-confrontational approach to discussing performance issues with employees by focusing on potential causes related to the process rather than attributing blame to the individual.

Building Businesses and Influencing People

  • Alex Hormozi introduces the purpose of his podcast: discussing strategies to sell more products, reach more people, and build valuable businesses.
  • He shares his ambition to build a billion-dollar enterprise with and documents his journey for educational purposes.
  • Hormozi highlights the universal need to influence others, especially in a business context with employees to achieve desired outcomes.

"Welcome to the game, where we talk about how to sell more stuff to more people in more ways and build businesses worth owning. I'm trying to build a billion dollar thing with"

This quote serves as an introduction to the podcast's themes, which focus on business growth, sales strategies, and Hormozi's personal journey in building a successful company.

Alex's Simple Framework for Employee Management

  • Alex Hormozi shares his struggles with management and the value of frameworks in overcoming these challenges.
  • He credits Layla for her managerial skills and introduces a triangle framework for understanding why employees may not follow through on tasks.
  • The framework is partly based on insights from Andy Grove's "High Output Management," which states that employees fail to act either because they don't know how or aren't motivated.

"And so I have talked about this in the past, but I will give you Alex's simplest framework, which is a triangle framework."

This quote introduces the triangle framework, which is a tool designed to help managers identify the reasons behind employees' inaction.

Reasons Employees Don't Follow Through

  • Alex Hormozi expands on Andy Grove's two reasons for employee inaction: lack of knowledge or motivation.
  • He introduces a third reason based on his own experience: employees may not know what is expected of them.
  • Hormozi shares a personal anecdote about a sales manager who didn't perform call reviews because the expectation was not communicated clearly.

"There's only two reasons that an employee does not do what you want them to do, which is either they do not know how or they are not motivated, right? And so he said, therefore, the job of the boss is to motivate and to train, said. And if you're not training, you're not motivating, you're not being a good boss."

This quote relays Andy Grove's perspective on employee inaction, emphasizing the manager's role in training and motivating their team.

"Number one is they don't know that you want them to do it. And so I'll tell you a quick story. So I had a sales manager that I really wanted to succeed, right? And so we hired them and they were new, and I was super excited. And a few weeks in, I was like, hey, dude, had a conversation with some of the sales guys and you haven't done any call reviews. WTF, bro? And the guy was like, I was unaware that you wanted me to do call reviews."

This anecdote illustrates the third reason for employee inaction: a lack of awareness about what is expected of them. Hormozi's story about the sales manager reveals the importance of clear communication between managers and their teams.

Communicating Expectations

  • Document expectations in writing and in multiple places.
  • Incorporate expectations into daily or weekly checklists and reports.
  • The frequency of communication about a task or metric signals its importance.
  • Regular reporting on specific metrics emphasizes their significance.
  • Lack of discussion or reporting likely results in the task being undervalued or ignored.
  • Peak of the triangle is to communicate the expectation, which helps in diagnosing issues without attacking the person.

"So if you say, hey, I need you to report on these three metrics, guess what they're going to think is important to you. The three metrics."

  • This quote highlights the importance of clear communication about what is important to the leader by requesting regular reports on specific metrics.

"The faster the communication cadence that you have around the item or task or activity or metric, the more important they will deem it."

  • The quote emphasizes that the frequency of communication about a task or metric directly affects how important employees perceive it to be.

"If you don't report on it at all and never talk about it all, they will definitely not think it's important and very, very, very high likelihood of not doing it."

  • This quote underscores that neglecting to discuss or report on a task is likely to result in it being disregarded by employees.


  • Determine if the employee knows how to perform the task.
  • Provide detailed instructions and expectations for the task.
  • Conduct training sessions and record them for future reference.
  • Communicate how tasks should be reported to ensure they are done correctly.
  • Being advanced means consistently doing the basics well.
  • Growth in small businesses is often attributed to personal interaction and service basics.
  • Businesses plateau when they fail to scale the basics that made them successful initially.

"Do you not know how to do this thing? Do you not know how to do a call review? Well, let me tell you what a call review looks like."

  • This quote illustrates the importance of identifying whether an employee lacks the knowledge to perform a task and then providing the necessary training.

"This is what we're looking for. This is the transitions. This is how we take the notes, and this is how I want you to communicate it to the sales team."

  • The quote specifies the level of detail that should be provided during training to ensure employees understand how to perform a task according to expectations.

"Being advanced is always doing the basics. Like that is what being advanced is, is doing the basics, even while you have tremendous volume."

  • This quote conveys the concept that mastery and advanced performance are rooted in consistently applying basic skills, even as the scale of operations increases.

Scaling Basics

  • Emphasize the importance of documenting and measuring expectations.
  • Ensure training includes how to perform tasks and how to report on them.
  • Recognize that maintaining the basics at scale is crucial for continued success.
  • Reflect on what made the business successful initially and find ways to replicate those factors at scale.

"And that's why businesses plateau. And so it's thinking about what are the things that made you successful in the beginning? And then how can I duplicate those at scale?"

  • This quote addresses the common issue of businesses plateauing due to neglecting the basics that initially drove success and emphasizes the need to replicate those foundational elements as the business grows.

"All right, so, number one, communicating the expectations. Doing so ideally, frequently, and making sure it's measured and in writing."

  • The quote reiterates the first step in the process, which involves clearly communicating and documenting expectations to ensure they are understood and prioritized.

"Number two is that we have the training side. Is that we showed them how to do it and how we want them to do it and how they. How we want them to report on those things."

  • This quote summarizes the second step, which focuses on training employees on task execution and reporting, ensuring they understand both the process and the desired outcomes.

Podcast Promotion and Engagement

  • Alex Hormozi emphasizes the importance of listener engagement for the podcast's success.
  • Encourages listeners to leave a review, highlighting the quick and significant impact of such actions.
  • Suggests that listener reviews can have a broader positive effect beyond personal appreciation.

"The only way we do that is if you can rate and review and share this podcast. So the single thing that I ask you to do is you can just leave a review. It'll take you 10 seconds or one type of the thumb. It means the absolute world to me. And more importantly, it may change the world for someone else."

The quote stresses the value of audience participation in promoting the podcast and suggests that leaving a review is a simple yet powerful way to support and potentially influence others.

Identifying Lack of Performance in Team Members

  • Alex Hormozi introduces a three-pronged framework to assess why team members may underperform.
  • The framework considers knowledge of tasks, ability to manage workload, and motivation.
  • Suggests that often "being busy" is a cover for lack of motivation, but can also indicate a need for further training.

"Is incentive. Is motivation. Is do they want to do the thing? Because think about it. If I said, hey, dude, I need you to do x, y, and z, right? And you know how to do x, y, and z, and you're not doing it. The reason might be that they are unmotivated."

This quote outlines motivation as a critical factor in task completion and suggests that lack of motivation may be the underlying cause when someone is not doing their job, despite knowing how to do it.

Conversational Techniques for Addressing Underperformance

  • Alex Hormozi discusses the importance of protecting a team member's ego while addressing their behavior.
  • He suggests beginning conversations with a compliment to soften the critique.
  • The approach is designed to help identify the root cause of underperformance through guided questioning.

"Now, that being said, when you introduce this three frameworks, I just love it from a conversational perspective and how to assess synth problems."

Alex Hormozi expresses appreciation for the three-pronged framework as a conversational tool for identifying and addressing issues within a team.

"It's really nuanced. I learned that one from Layla, just being real, but it works really, really well."

The quote acknowledges the subtlety of the approach and credits its effectiveness to its creator, Layla, indicating it's a proven method in real-world applications.

Problem-Solving and Role Adjustment

  • Alex Hormozi suggests that if underperformance continues after addressing the three key areas, it may be time for more candid conversations.
  • He mentions the possibility of finding a different role for team members who dislike their current job but are otherwise a good cultural fit.
  • Advises caution when considering role changes, as it may not always be the best solution.

"And so at that, point, then you can get into a little bit more real conversations like, you know what? I actually hate this job. And you're like, you know, we hate having you. I'm kidding. You wouldn't say that. You'd say, oh, my gosh, that sucks."

The quote illustrates a scenario where a deeper issue, such as job dissatisfaction, is revealed through conversation, prompting a discussion about potential changes or solutions.

"And if you like the person, they're a cultural fit and they have other skills, you may be like, well, maybe there's another role in the company that would fit you."

This quote suggests that a team member's skills and cultural fit may warrant exploring alternative roles within the company, rather than immediate termination, if they are not performing well in their current position.

Communication of Expectations

  • Importance of clearly communicating expectations to ensure tasks are understood and prioritized.
  • Emphasis on frequency and detail of communication, including recording it down for reference.

Did I communicate the expectation to you? Am I doing it with adequate importance to tell you how important this is to me? Which is frequency and detail of communication and making sure it's recorded down.

This quote highlights the necessity of communicating expectations clearly and with emphasis on their importance, ensuring that instructions are not only given but also recorded for accountability and clarity.

Training and Skill Development

  • The need for training that shows employees how to perform tasks and manage their other responsibilities effectively.
  • Ensuring that employees have the necessary skills to complete all their duties.

The training is that I actually show them how to do it and then how to manage the other things in general that they are doing. So they can get all this stuff done.

Alex Hormozi is emphasizing the importance of providing comprehensive training that equips employees with the skills to perform their assigned tasks as well as manage their overall workload.

Motivation and Incentivization

  • Internal motivation and alignment with company values are crucial for employee engagement.
  • External motivation, such as adjusting bonus structures and compensation, can be necessary to prioritize additional tasks.
  • Ensuring that employees understand the personal and organizational benefits of their work.

Are they motivated or incentivized in order to get this done? And so I talked about their internal motivation, but there's also external motivation, which is like, do I need to realign their bonus structure?

This quote discusses the importance of aligning employee incentives with the tasks they are expected to perform, suggesting that compensation structures may need adjustment to motivate additional responsibilities.

Understanding the 'Why'

  • The significance of explaining the purpose behind tasks to foster meaningful engagement.
  • Comparing purposeless activity to prison camps to illustrate the demotivating effect of tasks without clear rationale.
  • Providing concrete examples of how specific tasks benefit both the organization and the individual.

People a lot of times just want to know why. Just why? Why am I doing this? And if someone understands why they're doing, because otherwise, activity without purpose is what they do at prison camps.

Alex Hormozi stresses the importance of understanding the reasons behind tasks, noting that without purpose, work feels meaningless and demotivating.

The Impact of Detailed Work

  • Detailed tasks like updating CRM systems have broader implications for various departments.
  • Explaining the direct benefits to different teams within the company can help employees understand the value of their contributions.

It helps Cindy in customer success on the onboarding, give them a much more personalized experience. So we want to sell something great.

The quote illustrates how detailed work, such as updating CRM notes, contributes to the overall customer experience and the performance of other departments, reinforcing the significance of such tasks.

Personal and Organizational Benefits

  • Relating tasks to personal benefits, such as more efficient client screening and higher sales success rates.
  • Encouraging employees to see the connection between their actions and personal gains, as well as the company's success.

So now I just did two benefits to the global benefit, which, let's be real, a lot of people might care about if they're good people, but a lot of people do not. But for you specifically, when you leave the notes, it helps us screen out candidates on the front end so that we can use that data to make your call. Likelihood of close higher, so that a higher percentage of your time is spent closing people and talking to people who have the money, who have the problems that we actually fix, rather than wasting time with tire kickers and people who are probably not going to buy.

Alex Hormozi is explaining how detailed tasks have both a global benefit to the company and a personal benefit to the employee, making their work more effective and potentially increasing their earnings.

Comprehensive Approach to Task Compliance

  • Addressing all three aspects of the "triangle" (communication, training, motivation) increases the likelihood of tasks being completed.
  • The ultimate goal is to ensure company growth and personal success, even if it leads to existential questioning.

And so just explaining that process, you hit all three of the triangle boxes, and you are far more likely to get somebody who does the things that you're asking them to do so that your company can grow the way that you want it to, so you can make all the money in the world and then wonder why you did it to begin with.

This quote encapsulates the holistic approach to ensuring task compliance, touching on communication, training, and motivation, which collectively contribute to the growth of the company and personal success.

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