this ONE skill will help you scale your business

Summary

• The key to tripling revenue and doubling profits is hiring the right people using my three-part hiring framework.
• The first principle is character. Look for people whose behaviors reflect your business values.
• Early in my career, I trusted people's words over their behaviors, which led to mistakes.
• To assess character in interviews, ask questions that reveal past behaviors aligned with your values, such as achieving challenging goals or demonstrating integrity.
• Ensure you exhibit stronger character yourself to attract high-character employees.
• The second principle is competence. Focus on the skills needed for the job rather than just past experience.
• Experience can be a proxy for skills but shouldn't replace competency testing.
• Conduct competency tests or situational referencing to verify candidates' skills.
• Look for detailed, consistent stories in candidates' responses to gauge their honesty.
• The third principle is commitment. Ensure potential hires are willing to restrict other freedoms to dedicate themselves to the job.
• Assess the level of commitment needed based on the job role and the candidate's life phase.
• Be wary of candidates who overcommit or can't demonstrate their commitment clearly.
• True commitment means acting as if no alternatives exist. Test this by asking what the candidate has given up to pursue the job.
• Use the three C's—character, competence, and commitment—to ensure you hire the right people for your company.

Video

How To Take Action

I would suggest implementing a three-part hiring framework that focuses on character, competence, and commitment. This will help you hire the right people who will truly support your business values and goals.

Character

First, identify your company's core values. Make a list of behaviors that reflect these values. During interviews, ask questions that help you see if candidates have shown these behaviors in the past.

For example:

• Competitive greatness: Ask, “Can you tell me about a time you achieved a challenging goal?”
• Integrity: Ask, “Describe a situation where you had to be honest even when it hurt someone’s feelings.”

Competence

Make a clear list of skills needed for the job. Don’t just rely on resumes; experience doesn't always equal skill. Instead, conduct simple tests or use situational references.

For example:

• For customer support, ask, “How would you handle an angry customer?” Plan a role-play scenario to see their skills in action.

Commitment

Determine how much commitment you need for each role. Clarify if the job requires full focus or allows for side projects. During interviews, ask candidates about their willingness to prioritize the job over other activities.

For example:

• “What have you given up to pursue this job?”

Make sure to live by the values you seek in others. High-character employees will be drawn to a leaders who showcase even stronger character.

By focusing on Character, Competence, and Commitment, you will create a strong team that aligns with your values and business goals. This low-cost, high-value approach helps ensure you hire the right people, avoid costly mistakes, and foster a successful business environment.

Quotes by Leila Hormozi

"People often ask me, how do you measure for values? Behaviors are a proxy to values"

– Leila Hormozi

"If you say you have a value but you don’t demonstrate it, do you actually have the value or do you just wish that you did"

– Leila Hormozi

"You can’t attract people with great character unless you have even better character"

– Leila Hormozi

"Skill without commitment is untapped potential"

– Leila Hormozi

"True commitment is acting as if alternatives do not exist"

– Leila Hormozi

Full Transcript

what if I told you that there was one thing that if you focused on it would triple your revenue and double your profits that one thing is hiring today what I want to share with you is my three-part hiring framework if you don't know who I am my name is Lea horos and I have built and sold three businesses by the age of 28 leading to $100 million net worth where I used this exact framework to build all three businesses and the reason I want to share with you guys the three-part framework for how to hire the right people for your business is because that was the most painful experience ever went through as a business owner to have to fire people or flip people out feels very contrary to everything I want to do and I don't want anybody else that has a business to have to go through that pain again the first principle in hiring the right people is character what is character the mental and moral qualities of a person they share the values of the business because you can have someone that has great character but it might be great for a different business whereas what we want is someone that has great character aligned with this business so we want to figure out are people aligned with your values the first time I realized that this was the main discrepancy in my hiring was we had a team meet up we were all in person I walked out to the hallway of the team Meetup and I sat there and thought to myself these people don't share our values because if they did they wouldn't exhibit these behaviors and people often ask me how do you measure for values behaviors are aoxy to values if you say you have a value but you don't demonstrate it do you actually have the value or do you just wish that you did early on my business career I took people's words for face value if you say that you align with these values and you line with these values and that's what we think but what I learned later on is that behavior is the proxy for values what you want to see is how they act and then that tells you if they are actually aligned with those values and I've made this mistake multiple times some of you might be able to relate to this I had a guy and he was so smart so sharp and when he applied to work for me I was like I have to hire this guy he's got this insane resume of experience he's funny he's Charming like he's he seems uplifting in many ways I remember the moment that I realized I had really made a big mistake which sucked the guy took so much work off my plate he got in a fight with a coworker he shared with me the fight that he had gotten with that coworker and I looked at what he had said to this person and I was like oh wow that's pretty inappropriate he called this person words that I will never even say on YouTube and in that moment I said to myself this person does not have unimpeachable character that is what led me to understanding how ruthless I had to be in prioritizing culture over anything because really think about it right and and this is where a lot of people go wrong is you think gosh I can't hire somebody who doesn't have 10 out of 10 skills in finance because how are they going to learn that I can't hire somebody who doesn't have 10 out of 10 skills in being a salesp person how they going to learn that do you think it's harder to learn how to make a sale or how to have a hard conversation if you're very passive soft skills and character is much harder to teach than hard skills so the first piece of this framework is you have to safeguard your values you have to make sure that people are aligned with your values above all else so how do we find this out I call it operationalizing your values using Behavior as a proxy for values rather than what somebody says which by the way when you interview somebody they're pitching you they're selling you this is the best you're ever going to see so if you've got the iys on the interview you're definitely going to have the iys when they come in what you want to do is write down your values and then you want to determine how are you going to assess your values in the interview process that looks like asking questions that test to ensure they have demonstrated behavior in the past that aligns with the values you have we have the value competitive greatness what are some questions that I could ask somebody that would tell me if they've demonstrated competitive greatness in the past one question that I ask people can you tell me about a time that you achieved a really challenging goal now why do I ask that because the best people I've had on my teams have achieved very hard goals now it might not be in business it might be in music it might be a pro athlete it might be something personally that they've done the second question ask people is like what is your goal within your career and they say I don't know why I want to work here I'm fine with whatever I want somebody who's stubborn about their growth I want somebody who's competitive about being their best version of themselves to give me an answer that's like I've never really known I've always just kind of gone where I've been asked to I've just bounced around a lot that tells me that person probably has a low amount of competitive greatness now this is not to say that not knowing exactly what you want to do next is a bad thing but knowing that you want to grow is the biggest indicator and the last question I might ask tell me about your proudest moment in your career because again what is this asking it's asking what do they feel accomplished by and so I'm looking for somebody that is going to tell me something that was deeply challenging or something where they went above and beyond something anybody's ever asked them for but it built their character and made them a better person because of it being great because you want to be excellent not for the business and not for the money but for yourself and so I'm looking for people who are intrinsically motivated so all of those questions are basically asking people to provide me with evidence of their intrinsic motivation rather than people who just allow life to pass them by and go wherever the tide takes them so this could go for another one like if you have one around honesty then it could be when's a time where you were honest and it hurt someone's feelings but you knew you need to do it anyways because it's in line with your integrity what you want to do is you want to think through your values and then ask yourself how would somebody with this value act it's not what they say it's how they act and so I call this a reference question we want them to refer or reference a past experience so that we can ask them enough of those questions enough times to figure out are they bullshitting you or is this for real can they recall enough evidence that you're like this is potent in this person Lea that sounds great but how do I attract people with that kind of character you can't attract people with great character unless you have even better character if you are a musician and you want to find a mentor to teach you music are you going to go work for somebody who's worse at music than you no you're going to try and find the person who's the absolute best at music right now people want more than money they want to feel like they have a purpose and they want to feel like they have growth and opportunity within the place that they work if you put your values out there and you're screening for your values and you're testing for your values and you're saying I'm not hiring people without these values then you better live up to those every day because if you don't then you're going to get lesser Talent the second principle when you're hiring to get the right people is competence do they have the Baseline skills needed to successfully execute the role you don't hire people for experience you hire people for skill experience is only a proxy to skill if you hire somebody to be your executive assistant does it mean that they can only be the best executive assistant because they've done it for 10 years or could it be that somebody who was the concierge at a high-end Hotel could be a great executive assistant could somebody who was head of guest experience at Disney World be a great executive assistant it's not about the past experience they have it's about the skills they've accumulated from that past experience the biggest hack I ever learned is that people from Hospitality are like the best customer service the best EAS and the best operations people because they have acquired so many skills working in that hotel and hospitality industry that transfer over this is something that I have gotten wrong multiple times in my career the first time I think I really this up I was trying to hire for a CTO for Allen my software company and when I was trying to hire for that CTO I was like I don't know anything about software so I need to hire somebody with like the most experience and so I'm like yeah we need someone from like Google or apple or Microsoft or like one of these really big fancy companies during the process I didn't press on skills I was impressed by the resume and so I didn't feel like there's no way this person could possibly have had a job at Google rolling out their entire Division if they didn't have these skills that role cost me $300,000 not just in recruiting and how much I had to pay him when I let him go and how much time and effort was lost in the company when that guy came in you know what I realized I actually don't know why he succeeded in those places because he was the complete opposite of what I needed and he didn't have any of the skills I was expecting so what it taught me is that we cannot be enamored by somebody's experience on their resume experience cannot replace skills we look for experience as a proxy to skills but it cannot replace them and it doesn't mean you shouldn't test for them how do we make sure that people actually know how to do the freaking job is we do competency testing guys this should be so easy nowadays you can put this into chat gbt and say disseminate this down into the top five things this person needs to do for example if I'm thinking of a head of customer support I might be thinking of managing emotional customers building out an archive of customer inquiries managing a support team communicating with stakeholders expanding our knowledge-based platform can I have someone truly submit or do some sort of test so I can actually see their performance or do I have to do situational referencing situational referencing is basically asking them to refer to situations in the past for example if I want to hire a head of customer support and I want to know they built out a knowledge base I would ask them can you tell me about a time in your last job specifically this one that you had last year did you build up the knowledge base and how did you do it and I would let them tell me the story and guess what if somebody can't tell you a story about the thing they did what do you think is happening they're making it the up you want to ask them to refer to a story and the two red flags I'll tell you is that if somebody lacks details and beats around the bush it means they're probably not telling the truth I was interviewing somebody to be head of development I asked that person how big of a team have you managed this guy must have taken 7 minutes to tell me the size of Team he had managed and the reason it took him 7 minutes is cuz he had to give me all the things that he's done that are impressive besides managing people and then how he has actually managed people this one time cuz his boss got fired and then they gave him three people to oversee but he technically wasn't their manager but he did oversee three people he was literally delaying answering the question because he was nervous to give me the real answer which is no I have not there are some instances where you can have people do some sort of test so you can understand do they have this competency or not so for example I might be on an interview with somebody for head of customer support and I would say great I'm going to pretend to be an angry customer and just talk to me like you would an angry customer I have done that one to multiple positions before and what I've realized is like a lot of people actually don't have that skill they might have been ahead of customer support but they actually never had to deal with angry customers because turns out they always kicked them back to the sales cops or turns out they always kicked them over to finance and collections they didn't actually have to speak to the customers themselves what you want to do through this is basically you want to have what are the five core things this job does and then how am I going to evaluate each one of those five things to know that they actually have the skills to do the job the third piece to this framework is commitment skill without commitment is untapped potential you can have somebody with all the best character in the world and they can have the craziest abilities and skills in the world but if they're not committed to the job they're probably not the right fit for your team what does commitment mean I would say it's the state or quality of being dedicated you purposely restrict other freedoms so that you can have this one so what does this mean in a job it means I've committed to this job and I'm restricting myself from these other freedoms this day and age it's very common for people to do things on the side and so what you need to figure out is what level of commitment do you need from different jobs if somebody's going to be a leader in my company I want them fully committed to this job I don't want them doing things on the side why because I believe that leaders if anybody in my company should give discretionary effort individual contributors and such I'm a little bit more flexible but I would say that just because of the kind of company I have I think people will get more out of the job if they give it all their discretionary effort rather than doing a bunch of side projects how much Freedom are you asking somebody to restrict in the rest of their work life to commit to this one thing if I find somebody but they're in a season of their life where they've gone through like the grit of working like morning to evening to this and then they come and they see my company they're like wow I've done that before and it was so fun I want to do it again this that so seldom do they want to do it again they want to feel it again but they don't want to wake up at 5:00 a.m. and go to bed at 10: p.m. and put in those extra hours again and so sometimes people don't even realize for themselves that they want all the good without the sacrifice without the commitment and so you have to understand what phase of this person's life are they in most of our actual labor is done by people in their 20s and 30s why is that because at some point your life changes and that's not a bad thing but you need to understand for the job that you're asking someone to do do you need somebody who is making a large commitment and saying no to a lot of things or making a commitment and saying no to some things there are different jobs that require different levels of commitment if I have somebody who is running my portfolio running my Acquisitions running my marketing I need them committed are they at a phase in their life where they are able to commit in the way that you need them to to the job sometimes people tell themselves that they can commit but then they end up not being able to I've had people in the past who had their own businesses and they say no but I want to learn and work for you and so I'm going to put this aside I'm not going to do it anymore I'm just going to work for this company they were great for the first few months and then about five 6 months in I'm like what's going on like nobody can get a hold of them they're not responding on time they're not putting discretionary effort in like I don't know what's going on in the department I don't have Clarity or transparency and so then I'm like digging in trying to figure it out both of them actually had continued to do their businesses on the side thinking they could do it all they didn't fully commit to the degree that was needed to do the job and so the job suffered and so you just need to figure out what season is your business in and what is required from the specific job you're looking for and can that person match that and so in my opinion true commitment is acting as if Alternatives do not exist commitment is a process one follows not a statement that somebody makes and often times you don't need a new plan you just need to commit to the one that you actually already have how do you know they're committed what does this person give up to get this job you see this in companies that do stock plans or they do Equity you know why it's smart for them to do that is because they're saying you're betting on this job working out for you just as much as we bet on you working out for this job put $300,000 in because we know that that means that you're committed and guess what there are studies on this that show that Executives who buy into the company literally with their money to buy their stock actually last longer and are more committed and have higher performance so the question of how you know is what did they give up so to summarize it all we want to make sure does this person have the character do they have the competency and are they committed I call this the three C's to make sure that we get the right people in your company and here's the thing if you don't know what character looks like because you don't have values which are proxy to that you can go to this video right here where I talk about how to build out your core values for your company so that you can get the right people in the right seats