The Game with Alex Hormozi - Cut the Fat | Ep 165

Episode Date: November 20, 2019

"I've never fired someone and not found someone." Today, Alex (@AlexHormozi) discusses how to make decisions about employees who are not performing well. He emphasizes the importance of understanding cultural fit and provides tips for re-onboarding employees who lack the necessary skills to perform well.Welcome to The Game w/Alex Hormozi, hosted by entrepreneur, founder, investor, author, public speaker, and content creator Alex Hormozi. On this podcast you’ll hear how to get more customers, make more profit per customer, how to keep them longer, and the many failures and lessons Alex has learned on his path from $100M to $1B in net worth..Timestamps:(1:45) - Replace poor performers; disrespectful or uncommitted employees should leave.(3:52) - Poor performance is due to communication, skill, or motivation issues(5:44) - Scaling service requires scaling culture and values(7:59) - Respect authority to avoid termination. Communication may not be understood.(12:25) - Clear path to success motivates employees to perform well(14:58) - Team members must consistently perform to earn game time.Follow Alex Hormozi’s Socials:LinkedIn | Instagram | Facebook | YouTube | Twitter | Acquisition

Good morning, everyone. Happy Thursday. Hope you guys are starting your days off on the right track and having a great start. I wanted to continue the most frequently asked questions that we get at roundtables and when people are like, I have this dying question that I need to ask you. And so this may be you in your business right now and you're trying to make a decision and you want some insight on that decision. And so the decision that I'm going to hopefully help you make is about that employee that you're not sure about. right you're not sure if you onboarded them well because you're kind of busy you're not sure if you set proper expectations and kind of the role has changed a little bit um you know you like them but sometimes they don't buy into some of the things that you've uh that you've said that you want to do in terms of the vision of the business um and uh and you're just not really sure what to do with them

you know what i mean and so uh i want to um hopefully give you some context for how to make these decisions because we have hired and fired a lot of people at gym launch. And, you know, the nice thing is that we have had very, very, very few people quit. Like, very few. I think we've had under eight people quit and we've hired probably a hundred and probably 160, 180 people. And so we let people go, right? And we do that for a variety of reasons. And I will break them down for you. So a saying to kind of set the tone for this, I heard from my good friend Bart Miller, and he said, I've never fired someone and not found someone better. Interesting thought. So if you think about it right now, the fear is, well, will I find someone better? He is never, and this goes for me too, I've never fired someone and not someone found someone better to replace them, right?

It's typically because we don't want to go through the cost of the time to find someone new, when in reality, the employee that we have is costing us more than the cost of finding the new employee, right, that would come to replace them. And what I have found over time is that if I think about firing someone, I always eventually fire them. And so the time between me thinking about firing them and actually firing them since we've had more experience of business has just significantly shrank, right? Because at the end of the day, like now, as soon as I think it to myself, I'm like, yeah,

yeah, they're just not a fit, right? Like they're just, or they're just not good enough, right? And so this kind of reflects back to the zero tolerance mentality of how you need to run the business or your department or whatever it is, which is like, how much will you tolerate? Right. Like how poor of performance will you tolerate before you say no, right? And like the reason Steve Jobs and some of these huge entrepreneurs were so successful is because they just wouldn't put up with that. And so they're like, don't bring that shit to me. Like they knew they set the bar so high that like people had to.

to do everything to measure up to their standards. And anyone who wasn't was cut immediately, just like that. Right. And so one of the other things that's kind of big in terms of like making these decisions is that like there's a time to let someone go and there's a time to re-onboard. Okay. So I'll try and parse out the difference. If someone questions your authority or disrespects you or disrespects you in front of your

team or is not bought into when you want to make changes, things like that, they're gone, right? And the reason for that is because that's an attitude thing. That's a character thing. That is not going to change, right? And not anytime soon. And they are costing you more in the cancer that they exist in the business and the doubt and the seeds that they're sowing in your business that are negative,

like seeds of doubt that they're showing in the rest of your clients, the rest of your employees, the whole organization, right? So if it's a character issue, boom, they should be gone immediately, right? Now, if it's a performance issue, there's typically three reasons why the performance won't get. Either they don't know what you want, they don't know how to do what you want. So they know what you want, but they don't know how to do it. Or they do know what you want. They know how to do it and they're not motivated.

So there's really three pieces. It's the communication piece. It's the skill piece. And then there's the motivation. And so trying to figure out which is the missing link with them is kind of the next So assuming they have the character traits in terms of they are a cultural fit, which for a small business, typically the skills that you need to teach someone are not overly complex. And so when you're hiring for a small business, you're really just looking for personality traits, right? You're looking for a cultural fit.

And one of the key components that looking for cultural fit is not saying, I'm going to find people who are just like me because then you hire super scattered, and ADD semi-entrepreneurial people who can be a pain in the ass right and so instead you don't need to find people who have personality traits that are similar to you but have similar values right there are people who are very quiet who are very reserved who don't like selling have the same values as i do right and so understanding the difference there because you don't want people are exactly like you because then there's two of you and one of you isn't needed right and so especially when you're when you're bringing people on making sure that they have the cultural like that they're bought into the same values as you makes all the difference in the world. So right now, if you haven't

written down your values of what you stand for, and these values should be the few, the five, maybe six values that you live your life with inside of work and outside of work because you should never be different, right? And so if you have these values, you can speak them to people and people will either say like, yeah, I'm down for that. Or like, no, I'm not. And your value should be things that people disagree with, right? The more polar they are, the more they are your real values. Right. And what happens is when you make your values polar, you bring people in who do actually have your beliefs, right? And then it's not the fake beliefs, but the real beliefs that you have. And then all of a sudden, when they're presented with information, the same information you're presented, they make the same

decisions. And that's ultimately how you can scale service by scaling your culture, by scaling your values, right? So back to the decision of like, should they stay or should they go, right? If they're not a cultural fit, they're an asshole. They, they under, under, mind you they you know they talk bad behind your back they you know they go you want to launch a new program and they're whispering to the the clients like nah it's not going to be that good or like they roll their eyes at a meeting like here we go again like that kind of thing gone gone i don't know how to say that's gone right and you need to do that to set the fucking tone right because like this is your business and people need to know that all right now that being said

it doesn't mean being a dick right but like there is a tone that needs to be set i am I worked with a person for a short period of time who ran trainers fairly well. And I remember he's like, he's like, we need to do a trainer meeting. And I was like, okay, cool. And it was at like, I can't remember it was like 8 a.m. or 9 a.m. or something, whatever. And it was at one of the locations that was further away. And so we drove there. And at 9 o'clock on the dot, he locked the door to the gym.

And there were trainers outside. Bang, right? And all he did, he just went outside. he's like all of you were fired. Real quick, guys, if you can think about how you found this podcast, somebody probably tweeted it, told you about it, shared it on Instagram or something like that. The only way this grows is through word of mouth.

And so I don't run ads. I don't do sponsorships. I don't sell anything. My only ask is that you continue to pay it forward to whoever showed you or however you found out about this podcast that you do the exact same thing. So if it was a review, if it was a post, if you do that, it would mean the world to me and you'll throw some good karma out there for another entrepreneur.

And then we went in upstairs to the meeting to everyone was on time, he's like, he held the meeting, and the fucking tone in that room was like, oh shit, right? And it was like, oh, my God, like, this just got real, right? And so that's the point here, is that like, you have to have authority in the business. If someone is undermining your authority, they're gone. Right. Now, if someone is not that, they are, they are a culture. So if you're in that, you're like, oh, they're kind of like that. Like, just be done with it. Let me like help you make the decision. It's over. If you consistently thinking about firing them, you're going to fire them anyway. Stop dragging it out. Now, if you have a lot, you have a

someone and it's a performance issue it's either because they don't know what you want which honestly happens all the time because you're typically especially a lot of small businesses aren't good at communicating things on Furnners in general tend not be good at communicating they say one thing they walk away and they expect someone to know it right happens all the time I think Laila says the biggest myth of communication the biggest myth in communication is that someone thinks it occurred right you say something you think you communicated and they have no idea we're talking about right so one do they know what you want two do they

know how to do what you want the way you want them to do it three are they motivated right and so the how do you tell them like what you want them to do it is telling them and it is always documenting what you want them to do in writing like so like for us if it's not written it doesn't count like that's like how we like that's how we believe things work right if it's not written down if it's not an email it's not a summary of a conversation that follow like that follows up a conversation it didn't happen right and we don't even expect people to do it because we just know people we know better than that right and so if you

have a system like Asana or something like that that you manage tasks in then it would even further follow up into tasks that they need to be need to be done right and so one do they know what you want and if they if you communicate that to them you say it and then you fall up in writing next do they know how to do what you want do they have the skills to do what you need them to do now that could be from past experience if you're trying to hire somebody who's a little bit higher level unlikely for most people running small businesses. And so if someone's coming in, how did you train them? And typically, people are undertrained.

They're over-expected and under-trained. So how did you train this person? How many, like, real examples did they go through? How did you teach them? If you think about it like a school class, like did you give them a presentation where they're taking notes and it's a consistent presentation so they understand? And then you had them demonstrate it back to you. And then you had them do it again.

and then you had them do it again. Because if you do that, and then you walk with them with someone live through this experience, whether it's answering the phone, whether it's making outbound calls, whether it's selling, whether it's coaching a class.

They need to know what it looks like when it's right. Recordings are amazing for this because it takes you no time and they can absorb what ideal scene looks like, because you can paint that for them, right? And then once they've seen a bunch of recordings, then you can do a ride-along where they're riding with you on the hip,

right they're on your hip they're walking with you right doing whatever it is whether it's training sessions whether it's answering phones like i said like any of those things they're they're riding with you right and then after that you do a ride along but reverse now it's a learner's permit like you're driving but now i'm in the passengers you're like whoa whoa whoa whoa don't do that right oh whoa whoa what did you do it right um so i can correct in real time so we can get the behaviors up right and then after that then they have their training wheels and now when they have their training wheels that's when you still are talking to them once or twice a day if they're new so that you can make sure that the expectation that you've set is being met and let me be real with you most people have no fucking clue what they're

supposed to be doing they have no clue they got hired for this job the boss talked to them for like 30 minutes and then they just like went back to their desk and we're like okay so I think he wants me to right you just like think about it from their perspective they saw an ad they interviewed they got the job and then you spent 30 minutes with them and said hey hey, watch some of these videos, all right? And then good to go. Let me know if you have any questions. They don't want to bother you.

They don't want to bother you. They're like, ah, shit, I just don't want to get fired. And then they just try and, like, stay hidden. Because they're like, I just, I just don't know. I just don't want him to realize that I'm here. Right. I just want to get paid and just like not fuck up. And by not, and by wanting to not fuck up, they just don't do anything.

Right. And then you're like, and then three weeks later, you're like, what the hell? Like, why aren't they doing anything? Freaking employees, man. They just, it's free loaders. They just, you know, just expect to get paid and not work, right? When in reality, they just never were onboarded. It didn't know what you wanted them to do, didn't know how to do it.

A lot of them were motivated because that's why they got the job. Now, please, don't be wrong. There's plenty of lazy people. But, like, most people would like to keep their job. And so, like, if you just give them a clear path to win, then they will. Right. So, big recap on this. If you have this person in your business that you are not sure about.

If you don't know, you know. It's just like marriage. If you don't know. you know let him go if it's something that's cultural or behavior like uh or personality wise like like gone right now the only so now that's probably like two-thirds of the people who are thinking about firing someone just fucking get them out the door all right be done with it all right give my my you have my blessing all right now for the remainder you're like man they're they're bought in like they really are bought in they love what we do here like i think they're a fit okay

their role has probably changed several times since they've been working with you because you've evolved as an entrepreneur. Things have changed. The business has evolved. And so you probably haven't re-updated them or re-onboarded them. And so just going through this will just massively increase your ROI on that human being's time. Right. They're a human, which means there's another person who's working in your business. So you can get a lot of productivity out of someone who has clearly defined goals and has the skills to do the thing. Right. And so one, re-onboarding through communicating with them and having it written down. In the short term, if it's a project, then it's going to be an email. If it's a long-term thing, like a huge role change, then it's going to be a

one-page summary of their new role, descriptions, et cetera. All right? Once they have a clear understanding of their role, then you have to teach them the skills. That's where you first give them the recordings so they have an understanding. Then you present, you give recordings. Then they do a ride along with you. Then you do a ride along with them. And then they get training wheels where you're touching base with them every day, sometimes twice a day. And after that, then you can decrease your cadence with them so that it's two or three times a week. And then eventually you can get to weekly. And then it pretty much never stays beyond weekly. I mean, never goes less than weekly after that. So hopefully, tactically, if you're listening right now and you're

not sure about what to do with an employee, you can know whether you want to let them go or how to get them re-onboarded and back in the fray so that they can be great. And never be afraid to let people go because I've never let someone go and not found someone better. And I will say that productivity of a team, typically always increases after someone is let go and you also do it out of respect for everyone else on the team like if you have three A players and there's a C player like that C player drags the whole team now like it is a team not a family and so if you're like we're a family here like you need to get that out of your lexicon because like you pay someone right you probably don't fire your kids

but you will fire someone if they don't perform so I just don't think it's worth having the the fake the fake family because you're not there's a paycheck that separates you the dynamic your relationship will always be one of someone who's getting paid versus paying someone else. And so it's like, this is a team. You had to try out to be here and you got to consistently play to get game time, right? Like that's it.

And then like if you're not on the field, then like, I don't know, like that's it. There's like, that's why there are teams and people get cut from teams. And so if you run yours like a team, actually, you know what, I'm going to a little anecdote. Many of us in fitness played for teams. A lot of us played for high level teams.

And you've known what a good coach is like, and you know what a bad coach is like. You're like, man, and some of you had the fortunate, like, a circumstance of having a bad team and then having a new coach come in who was a good coach, and then the team turns around. So you know the feeling of what it's like to have a high performance team, where there's expectations where you want to make the coach proud. There's a vibe of high performance. That is what it should feel like in the business.

If it does not feel that way, then it means that you lack the skills to create that environment within your business. And so one of the first ways to do that is to get the bad players. off the team so that you can rebuild. So anyways, hope you guys have an amazing Thursday. Keep being awesome, lots of love, and I'll get you guys a little flip side. All right, bye.