The Talent Grid – How I Recognize Skill in Self & Team

Summary

• I've learned that developing frameworks is key for solving problems and growing businesses more efficiently.
• It took me six years to build my first eight-figure company, but as I developed frameworks, subsequent businesses grew exponentially faster.
• I've discovered there are essentially three levels of talent within a business: individual contributors, managers, and leaders.
• As an individual contributor, you need to learn what to do and spend all your time actually doing these tasks.
• Once you understand the "what," it's crucial to grasp the "how" to accomplish these tasks, which prepares you for the next stage – management.
• As a manager, your role evolves into teaching others to do the tasks you once did, ensuring consistent execution.
• True leadership is about systematizing or, as I like to say, "building the machine that builds the machine," which allows for scale and growth beyond your direct involvement.
• My benchmark for a systematized business is when I can step away from the day-to-day, no longer needing to be directly contactable except for vision and strategic decisions.
• It's essential to assess yourself, your team members, and your departments periodically to identify at which stage you're operating to understand where bottlenecks may lie.
• This constant evaluation helps you decide what aspects of your business need to evolve from doing to teaching to systematizing.
• Recognizing and developing the right traits and skills at each level, for yourself and your team, is a continual growth process.
• Rapidly growing companies need to adapt by potentially changing out managers for leaders, as the skills required at each stage of growth are different.
• An effective operator must understand and master all these levels to identify, foster, and lead talent appropriately.
• Self-improvement and growth for entrepreneurs are non-negotiable as they need to inspire and attract higher-level employees.
• Lastly, it's not uncommon for entrepreneurs to overestimate the effectiveness of their team, so critical and consistent reassessment is crucial for sustained success.

Video

How To Take Action

A good way of doing things is to start with what you can do right now without needing a lot of time or money. Here's a plan:

• First, learn what tasks are important in your business. Focus on doing these tasks really well.

• Next, understand how to do these tasks the best way. This means figuring out the steps and order for everything.

• Then, if you're ready, teach others how to do these tasks. This helps you move from being someone who does everything to a manager.

• When you're a good teacher, try to make a system. A system is like a machine that helps you and your team do tasks without you always having to show them.

• Always check how you, your team, and each part of your business are doing. Are you doing tasks, teaching them, or have you made a system? This will show you what needs to get better.

• Remember that as your business grows, who’s in charge might need to change. The skills needed to run a big company are different from a small one.

• Keep learning and getting better. This will help you find and keep great people to work with.

• Don't think your team is perfect. Keep checking and be honest about how well they're doing and how well your business systems are working.

Do these steps bit by bit. Over time, these small improvements can make a big difference!

Quotes by Alex Hormozi

"My ignorance is costing me so much money"

– Alex Hormozi

"You have to learn what to do, these are the skills"

– Alex Hormozi

"Identity is very fluid if you want to be successful"

– Alex Hormozi

"You have to be able to change what you think about yourself in order to become the thing that's going to to de-bottleneck the business"

– Alex Hormozi

"I define this within a business where I'm no longer on the slack channel"

– Alex Hormozi

Full Transcript

that one of the most important things that happens as we grow is that we learn frameworks and that's why when you look back at what you used to accomplish you know years ago it seems like you could fix those problems so easily because you have frameworks with which you've learned to think right and so uh it took me six years to build my first eight figure company six and a half to build my first eight and a half figure uh sorry multiple eight figure company because that was the the same company the next company that i did that was multiplied figures was it took me a year to build and the one after that took me six months and so we've gotten faster and faster and faster at doing this and now we've done over 120 million in sales across different industries and one of the key frameworks that i've developed or helps me think through things is something to share with you today all right so there's kind of three levels employees or talent right and this really applies to you or your uh your team itself because at the beginning it's you right and so depending on where you're at you may you may be at one of these levels or you may have to recognize it in others and i'm going to say in in three different ways so i have a nice little nine nine grid here the simplest way to think about this is in the beginning you have to learn what to do all right this these are the skills right and that's because which you are in the beginning is an individual contributor all right that means you actually have to get things done in order for them to you know happen right and so what you're doing at this point is you're doing right all of your time is spent doing the things right learning what to do etc now the reason it's really important to be able to recognize where you're at is because then you'll be able to look through this framework and immediately see what you need to do next to the same degree you may have gone through this but not have recognized the shifts and you can look at an employee and say i think they are in this bucket i think they are in this bucket i think they have the potential to get to this bucket etc many times people will stick at one level because of their own beliefs that they have about themselves which is why we you know laila and i believe that identity is very fluid if you want to be successful because you have to be able to change what you think about yourself in order to become the thing that's going to to de-bottleneck the business because ultimately it's costing every single human on earth a billion dollars a year not knowing how to create a billion dollars a year in revenue right and that's how i always think about this it's like it is costing me so much money my ignorance is costing me so much money and so hopefully with this video i'll break down some of the other things that you won't be ignorant to so you can recognize them in other people so level one is understanding what to do right which means you're an individual contributor and what your time is spent is doing all right the second level here is is understanding uh how all right so you started to do it right the what you figure this out but then you have to figure out how you're actually doing it right and the reason for that is because the next level you become a manager all right and that's making sure that other people can do that thing and they're consistently executing at a level that works right and so here what you're doing is you're teaching right you're teaching other people to do the thing right and so at the beginning you're doing right as an individual contributor you have to focus on what it is right the next level you're doing you're doing all the doing and you're like you know what i feel like i understand this better right i didn't feel like i understand the sequence of how this works right and then you can teach other people how to replicate that skill and at the very end i'll show you how to apply this to departments in a second all right so stay tuned for that but this is level one right as you're looking at yourself or an employee right level two is oh i think this person could teach other people i think they could manage them and as a quick caveat here like not every like managers don't necessarily need to know how to do something better than an individual contributor there's always going to be niche expertise etc but they should understand how it works right and so this is just an important like just nuance to note there right the third level is what i look at is the who right and i know this may sound odd it's like what and then how then who but that is kind of what it evolves to over time all right the title here is a leader all right and these are very different than managers which is something that i had to i had to realize as i was scaling the business and you know usually at this level this is where you're at your you know three-ish million dollar a year level and this is what allows you to you know crack crack open to the million plus uh per month level so 10 10 million pluses you have to have leaders that are engaged right the thing that you're doing here is you're systematizing all right and so what i'm gonna i'll say this a different way too because i think it's worth noting is building the machine that builds the machine all right and the reason that's important is because first you're doing it then you're teaching it and then you need something that can teach it for you that's kind of how this works right so it's always it's it's um it's not delegating it it's systematizing so it's really i was trying to be thoughtful about what word i was going to use there because it's like is it delegating it is it is it is it handing it off it's it's systematizing it and there's a lot of different ways you can system you know build a machine that builds the machine but if you think through this in terms of your own frameworks the way the reason that i like this is that you can actually grade yourself in terms of where you're at you can grade yourself in terms of where a team member is at and you can even grade departments right within your within your business which depending on what your size is your departments might just be might be things that you were doing right if there's if you're a solopreneur for example then like you wear all the hats your finance your hr your legal your i.t your marketing your sales your product your fulfillment your all of those things right but as you grow you know in the beginning you'll have your first core team of probably five people and they'll fulfill each one of those functions you have somebody who helps you with you know delivery you'll have somebody who helps you with you know finance who does the bookkeeping maybe somebody helps you with marketing maybe that's you somebody helps you with sales etc right and so what you can do is you can look at a department and say what level am i involved here right and eventually the goal is that you can move right move above right me equals you know ceo and so you have a team of leaders who are building the machine that builds the machine for you so that the actual whole thing works without your um without you being there besides providing the vision and strategic insight for making decisions right and so for me i define this within a business where i'm no longer on the slack channel so in our portfolio companies if i am no longer on the slack for that company meaning no one can reach me besides the one person who's in charge of that company that is what i believe is a truly uh delegated business that acts as a portfolio where you are actually an owner right i can't say the amount of times i like i talk to entrepreneurs and they're like oh yeah i could totally take this new project on like my business is totally systematized and and i'm like dude like no it's not like your phone's blowing up twice since we've been on like since we've been sitting here talking like like yeah i mean just because you don't have to respond to something in the moment doesn't mean that you don't have to eventually respond to it or make a decision or etc right like those are things that are still levels of involvement that require your existence and presence and so for me it's if i'm not in the slack channel i have one meeting a week with the with the owner of the owner the um with one of our portfolio companies the manager operator etc of a portfolio company and between that time and the next time the company can continue to grow without my direct involvement that is what i would say is checking all the boxes for me and if something's not checking all the boxes you can check all the boxes at a business level but you can also just look at this as a department level and the reason i think this is so important is that it can give you a grade that you can look at to improve so you might have you know marketing and you might have sales and then you might have you know product and then you might have you know uh shared services which would be like i.t legal hr all that kind of stuff right and you can look at yourself and think okay do i have in sales for example do i have people who can like am i the one doing the sales okay well maybe i'm not doing the sales well i'm the one who's teaching people how to sell okay well have i built a machine that teaches people how to sell so that i don't have to do the teaching of selling so i can actually just bring people in on a consistent basis and get them up to speed right that's where you start looking at like hiring one two three sales people a month right and they you put them through the machine that builds sales people right and so you can look at these levels within each of the departments so maybe maybe that's what you're that's where your sales is at right you've got a machine that builds the machine awesome but is your marketing there right do you have a machine that builds the machine there or are you still doing are you still teaching people right and here's here's one of the the things that i think for me it took a long time to realize is that it's actually your strengths oftentimes which which becomes almost always the bottleneck in the business because the things that you don't know you're far more comfortable giving away to people so that they can build these things right because they have better expertise because they know how to do teach et cetera and that's where you as a ceo as an entrepreneur is you actually have to walk them through these things so it's like okay great so uh you know you know how to do some whatever it is the the delivery of your of your product you tell someone to do that it's like great now i need you to teach someone else how to do that so we can build a team of people who are doing that so we can scale right and then finally at a certain point it's like man i'm spending all my time teaching it's like okay well we need to build the machine that does the teaching for you and so i think if you can think through this framework for each of the departments that you have in your company you'll figure out where your bottlenecks are and it'll at least give you a grade and so every quarter you can look at your your your business on a on a little little sheet like this and think okay do people know what to do do we have the base skill okay do we have the sequence the how to do it right teaching people step by step how to do this process right and hold them accountable and then finally can i find somebody who can help systematize and build the machine that builds the machine that recreates the skill over and over and over again and other people right and so that's kind of the process and what's interesting if you listen to uh reid hoffman founder of linkedin he talks about the difficulty for most employees most people to jump these levels it's very difficult for most people which is why especially like rapid rapid growth companies they'll often have to you know change out i'll say leadership with quotes here just anyone who's in charge because in the beginning there's probably more managers and over time there need to be leaders and a lot of times the managers despite their tenure aren't actually leaders right and so when i'm looking at talent within our own business i'm thinking okay who's a good individual contributor and sometimes sometimes amazing leaders are terrible individual contributors and sometimes a lot often times good individual contributors are terrible leaders right and so it takes a very unique person which is why being an operator so hard is that you have to really master all of these levels so that you can recognize it and teach it in other people because ultimately what we're doing is we have to walk the path that every person who's behind us must walk which is why entrepreneurship is such a such a growth-oriented you know occupation like you have to grow yourself in order to attract people who have who are who are at a certain level right like imagine if you're if you if you were to start working for somebody and you feel like you know way more than them and that they're just have no idea what they're doing right then it's unlikely that you're going to be very influenced by that person that person's not going to inspire you to do anything on the flip side if you if you were to start working for somebody and you you aspire to be like them you like their character traits you love the way they operate in their personal life and how they do business etc then that is somebody that you were being led by right and so for us as entrepreneurs like a lot of times we have to think like how can i improve my character what are the traits of mine that are deficient so that i can hopefully inspire people that i can bring people in at this higher level and then actually be able to execute because i can't tell you the amount of times i can't even like most entrepreneurs i've talked to i'd say 95 percent of them oh my team's amazing i love my team they're awesome and at the same time they have all these horror stories about teammates and i can't say like amount of times that i've talked to somebody they said their team was awesome and i talked to him nine months later like oh no that team wasn't awesome this team's awesome right i'm like dude the perspective in which you you make judgments is flawed and i don't believe anything you say because every time you've said this it has been wrong so why would i believe differently now and so these are the levels that i think of for myself my employees departments and then ultimately the business this is just a different way of thinking through it hopefully is valuable for you if you have these frameworks you can look at your own businesses apply things faster and break through the bottlenecks that you have so you can get to where you want to go if you like this you know subscribe check out one of my uh my next videos that are coming up and um hope you uh keeping awesome and accomplish all your roles