The Game with Alex Hormozi - The One Problem Every Entrepreneur Has... | Ep 292

Episode Date: April 20, 2021

Every entrepreneur has one problem... a people problem. Attracting, hiring, and keeping the right team members can make or break your business. Today, Alex (@AlexHormozi) talks about the single problem that entrepreneurs are facing when it comes to company growth: the talent they hire. He also explains the various reasons why this is a problem for entrepreneurs and the steps to take to avoid it.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:(1:48) - Knowing team members' differences and strengths, weaknesses, etc.(4:10) - Employee ownership, accountability, and providing solutions after situations(6:55) - Brand manager cares about improving customer experience deeply(9:20) - Raise the bar to attract the best employees to your teamFollow Alex Hormozi’s Socials:LinkedIn | Instagram | Facebook | YouTube | Twitter | Acquisition

Every single entrepreneur has one problem. They think they have multiple problems, but they have one problem. And it's a people problem. Welcome to the game where we talk about how to get more customers, how to make more per customer, and how to keep them longer, and the many failures and lessons we have learned along the way. I hope you enjoy and subscribe. All right, in this video, what I want to talk about is I just finished our strategic meeting and it was so apparent some of the new talent that we brought in, how much they were really

driving growth in some of our companies. And I want to talk about this because I think it's a very important. it's a single hardest thing that entrepreneurs face. Every single entrepreneur has one problem. They think they have multiple problems, but they have one problem. And it's a people problem. They don't know where to find good people, number one. Number two, they don't know how to hire and recruit those people.

Number three, they don't know how to manage those people. Number four, they don't know how to grow and cultivate the talent, right? And so that entire process embodies what really growing a business becomes after you get to probably about 10 to 30 million years when ops really start taking over. especially at 30, it's all about talent. And I think I've said this before, this is probably the biggest, it's been the biggest bottleneck for me

crossing 30 to 100, was really understanding that. I was understanding that it was all about the talent. It's actually not about you. And that can be really hard for your ego because you love being needed. And that's like an interpersonal need that we have from childhood or whatever it is.

We didn't get hugged enough. But like, that need is something that is outside of the business. The business doesn't require you. The business should be able to run on its own. And this is something that has shifted over time. That being said, it doesn't mean that you can't have the strategic vision for the business. You know, Bezos just stepped down for the first time after, you know, 30 years or whatever. But the actual doing, the leading, all that stuff over time, the company becomes a company of companies.

Right? It becomes a conglomerate as you grow. And so what I want to talk about specifically today is how to find and know the difference between an A player and a B player, or really an A player and everyone else. And I can't really stress how unbelievably important this is. And the thing is that we talk to entrepreneurs, they're always like, my team's awesome. And you talk to the same entrepreneur a year later. And they're like, that team was horrible. This team's awesome.

And that's because we're eternal optimists, right? That's just the reality of it. If you can't look at someone on your team and be like, I think this person's kind of weak or I think this person could be better, then you really have rose-colored glasses on. And that's the hard part. And I honestly, this wasn't real for me until I actually saw, teammates of mine growing divisions of our companies without me, doing it in ways that I had never thought of. Once that happened, it became real for me. I think there are these different

steps in your entrepreneurial journey. I mean, the first one was when I remember the first person who did a sale for me, I cried. I remember I cried because I heard about it on the phone and they're like, yeah, I sold two people today. And I had done every single sale for my business for like a year and a half. It was just no one could bring it in, right? And the answer is other people can bring it in, you're not special. But it wasn't real for me. And as soon as this girl did this, I was like, oh my God. Like, I don't have to, I don't have to literally make the money. Someone else can do this and I can actually start running the business. And so it's a huge breakthrough. And there's obviously levels to this, right? And I think the level that I just recently had

a breakthrough on was watching teammates actually grow the business without me. Right? And it's really special. It's really awesome. So you're like, that's awesome for you, Alex. Why are you talking to me? Great question. A players and B players. So what I want to do is tell you a quick story because I think it's perfect for illustration. So we just recently promoted a brand manager, one of our companies, and she was given the task of like, hey, why don't you think about other revenue streams that we could possibly bring into the company? And so she said, I thought we should start an apparel line because I'm getting lots of messages on social media about how we should have apparel, and I think that would be a good opportunity.

And so her supervisor said, I think that's a great idea. Go for it. Right. And so what she did was she emailed, you know, 20 different, you know, manufacturing companies for apparel. She got samples from all of them. She tried them all on. She felt them. And she showed up to the strategic meeting and she was like, they were crap. She was like, I'm not sending that to my customers. She said those exact words. And I can't tell you what it felt like for me as an owner to hear that. She said, I'm not sending that to my customers. And it was because it showed so much ownership. And one of our core tenants is be your own boss, which I'm switching to act like an owner. But that's exactly what she did. And to push it even further, she didn't just stop there and say,

all of this stuff sucks, because that would just be presenting a problem. Instead she was like, but I did find some manufacturers that don't do manufacturing and fulfillment because some centers do both, which is much more convenient for me as a business. But she's like, but their stuff is legit.

It's awesome. She's like, so I just need help figuring out how many pieces do you want to order as a baseline. I'll figure out the logistics to get to a third-party fulfillment center so that we can do this apparel launch. And so we ended up coming a solution for it, and she felt great about it. We looked at different designs and with the great quality

and we were able to come up a solution. But here's what I want to break apart for you. Imagine a normal person, a B-level employee. Nothing wrong with them. There's lots of them, right? But they show up, they do their job, they go home. right they don't take ownership because what what an alternative story of what would have happened is the director says hey want you look for new revenue opportunities and that

person may or may not have done it at level one right level two they actually do it and they say I think apparel she says okay go check out apparel now what that person probably would have done was look at three companies from a Google search maybe or maybe not even sample the product just look at the pricing and say hey I found an apparel company we can print our logo on it we can ship it out that is what a B player would have done and honestly unless you have an A supervisor the A supervisor probably would have let it go and what and I'll tell you the difference real quick guys you guys already know that I don't run any ads on

this and I don't sell anything and so the only ask that I can ever have of you guys that you help me spread the words we can out more entrepreneurs make more money feed their families make better products and have better experiences for their employees and customers and the only way we do that is if you can rate and review and share this podcast. So the single thing that I asked you do is you can just leave a review, but take you 10 seconds or one type of the thumb, it would mean the absolute world to me. And more importantly, it may change the world or someone else. The difference is with the A scenario,

you have a high quality product that people buy, enjoy, and buy again. And that massively increases the LTV of the customer. And on top of that, that brand manager cares deeply about the customers and their experience. And she's going to be thinking, top of mind, how do I make this easier? How do I make this faster? How can I improve their experience, right? Whereas the B player, you already lost them like, oh, yeah, they don't like the t-shirts. I mean, what do they expect, right? I mean, like, they're a $30 t-shirts. I mean, they're not going to be, you know, X, Y, Z. And so that difference is the game. And finding people who think like that A player compared to people who think like the B player is the difference

between companies that grow and companies that die, companies that barely competed. make it and companies that thrive. And none of what I just described was earth shattering. It was just a willingness to do more work and raising the bar. It was having a level of intolerance for anything but excellence. And it is my belief that within a company hierarchy, every person, the higher, the person who runs the division or the department or the company should always have the lowest amount of tolerance for anything but excellence, which means you should

should be intolerant of anything that is not amazing, right? And that trickles down. It gets diluted, right? At every level, it's diluted a little bit more, a little bit more, a little bit more. And if there comes a day where you see two people and you see a supervisor and you see someone underneath of that supervisor, and the person underneath

has a lower tolerance for anything but excellence, then the supervisor, those roles should reverse. The person who cares the most should be the one in charge. And so if there comes a day where someone cares more about my customers and the experience and the business that we have than I do, they should rightfully run the company, not me. And sometimes entrepreneurs get to that point. They have a CEO and they elect them because they're like, I think that you're better equipped for this and I think that you care more deeply. And that's okay. That happens, right? You know, Phil Knight doesn't

run Nike anymore. But, I mean, shoot, Jeff Bezos says, and you obviously step down for other reasons and whatnot. But the big picture here is having a level of intolerance for what an A versus as a B looks like starts with us. And the thing is, whoever you hire, most people only hire people worse than them. And so if you're one level removed or two levels removed, dear God, imagine what's being hired on the front line. And so you have to carry this torch,

you have to raise this bar, you have to set the standard so that A, players will be attracted to you, and also so that you can have a team of A players, and then the entire culture rises. If you've ever been on a winning team, on a championship team, You know the difference between the vibe, how people come to practice, how they play, the expectations of one another, right?

The speed of response, the team or all of that, that's culture. And that's only created through having the right players on the field, the right people on the bus, and kicking off the wrong people. And I'll end with this quote from the head of people for Chick-fil-A, which is a company I admire a lot. She said a lot of companies want to compete against us in the championship, but the reality is They lost in the draft. And that one really resonated with me because, and I'm paraphrasing here, that might not even be her title, but that was what she said in general.

And that really struck me because so many of us, or we're always trying to develop, or always trying to develop talent, all trying to do all these things, management styles, et cetera. But some people just come with batteries included. There are some people who are just winners, right? And you just need to get out of their way. And I think that it's worth the extra five interviews. It's worth the extra 20 interviews to find the A player because once that person is in place, they will grow, right? They will grow whatever they touch.

And this has been a deep lesson for me, which is what, you know, people are like, it's all about people. And it is. It's just boring and unsexy for most entrepreneurs because we love the promotion. We love the sales. We love the marketing. We love all that stuff, right? We love the product.

But the people is what runs it. And I think that this has been a deep lesson for me. And I hope if you look at your team right now, you don't think, oh, they're all amazing, right? Because the reality is they're probably not, right? And every single entrepreneur says that. I can tell you right now some people that are weak on our team, right? But you have to be honest about it. And you have to think, not just what are they doing, but what would I be doing in their position?

What initiative would I be taking that they're not taking? What questions would I be asking that they are not asking? And ideally, you want someone who's asking questions that you haven't thought of. and that's when you know you've got an A player. So anyways, this comes with time, it comes with experience. It comes with once you've seen an A player, you can never unsee them. And then you start to use that template to apply to other people. And then you repeat it over and over again.

And I think that's why entrepreneurship takes time. Like you grow, you grow in levels, you grow in tolerance, you grow in interpersonal understanding, you grow an awareness of other people. And as you grow in that awareness, so too will your selection of talent, so too will your recruitment of talent, your management and growth, those people. So anyways, hope that made sense. Hope that was valuable for you. If you're hiring people, only look for eight players. Put in the extra time to get the A player because it will pay you dividends beyond your wildest dreams. And there was a Harvard study that showed that eight players

were worth five times more than new players. And with that, I'll catch you soon. Bye.