From: alexhormozi
To succeed in business, it’s essential to understand and implement effective prioritization. Most people do “the wrong stuff” [00:00:02], leading to slower growth or stagnation. Businesses must focus their limited resources on the most impactful tasks, rather than being distracted by numerous smaller issues [00:01:17].
Business Growth as a Tree
Imagine your business as a tree, where its height over time represents your revenue [00:00:30]. Offshoots or “B+ problems” (e.g., adding a minor feature to an email sequence) [00:00:54] divert resources that could otherwise contribute to the main trunk’s growth [00:01:00]. These distractions make you feel productive, but your revenue may remain stagnant [00:01:09]. By “pruning” these offshoots – cutting off less important tasks – all resources flow directly into the main trunk, allowing the business to grow consistently by focusing on the “one thing that is going to move the tree up the most” [00:01:17].
True growth isn’t about the quantity of tasks completed, but “the amount of growth each task gets you” [00:01:35].
Commitment: The Elimination of Alternatives
Commitment is defined as “the elimination of alternatives” [00:01:49], making it the “recipe for growth” [00:01:54]. This means focusing all resources on the single growth path that yields the most return [00:01:57].
Most people tend to tackle easier “B+ problems” because they know how to solve them, providing a quick sense of accomplishment [00:02:32]. However, the most important “A+ problem” — often hairier, more complex, and requiring more analysis and iteration [00:02:39] — remains unresolved [00:02:17]. This leads to daily satisfaction but monthly disappointment when major breakthroughs are not achieved [00:10:20]. Solving the A+ problem often makes other tasks irrelevant by comparison [00:02:26].
The Theory of Constraints
Prioritization in business is based on the theory of constraints [00:07:23], which states that businesses have one limiting factor (constraint) to their growth [00:07:26]. By identifying and addressing this constraint, the business can achieve significant breakthroughs [00:07:30].
Strategy, in essence, is the prioritization of “limited resources against unlimited opportunities” [00:08:13]. While there are countless ways to grow a business (e.g., ads, site optimization, sales conversions), there is usually one action that will drive disproportionately more growth than others [00:08:18]. The most effective strategists are those who are excellent at prioritizing [00:08:43].
The Big Wheel Analogy
Consider a small wheel spinning very fast versus a very large wheel [00:09:20]. One revolution of the large wheel can cover more distance than ten revolutions of the small one [00:09:36]. The goal is to find that “one big wheel” – the A+ problem – that, when solved, makes all other smaller efforts irrelevant [00:09:46].
Frank Slutman, a three-time IPO entrepreneur, emphasizes focusing companies on only one objective at a time [00:06:29]. By addressing the most important priority, “number two through five sometimes become irrelevant” [00:06:57], or a new, more important next step might emerge, potentially saving wasted effort on lower-priority tasks [00:07:02].
Implementing Prioritization: A 4-Step Process
Once the single most important priority is identified, humans and teams naturally resist doing the difficult “A+ problem” [00:11:04]. To pull the future forward and ensure commitment, a four-step process can be followed:
- Prioritize: Clearly state the one most important thing to be done [00:14:42].
- Create Urgency: Set deadlines and increase meeting frequency (e.g., from weekly to daily or twice daily) to communicate its importance [00:11:20], [00:14:49].
- Eliminate Everything Else: Make it clear that all other tasks are secondary and must be set aside. This means being comfortable with some “fires” burning in less critical areas [00:11:46], [00:15:00]. The leader must explicitly authorize this and take accountability for any fallout [00:03:31], [00:04:40].
- Reassess: Once the priority is solved, reassess the situation, as the solution might have made other previous problems irrelevant [00:06:01]. Then, re-prioritize and repeat the process [00:15:29].
Additional Tactics for Effective Prioritization:
- Increase Communication Frequency: Between meetings, ramp up check-ins to reinforce urgency [00:12:13].
- Make Winning Obvious: Use dashboards, progress markers, or thermometers to publicly display progress, reinforcing the team’s efforts [00:12:42].
- Provide Incentives: Offer a “pot of gold” for reaching the goal (e.g., team dinner, day off) to show what’s in it for the team [00:13:02].
- Address the Unknown: A+ problems are often “soaked in the unknown” [00:20:33]. It’s crucial to understand that the initial phase of solving these problems involves learning and understanding the problem itself [00:21:06]. This is like “eating an elephant one bite at a time” [00:21:18], or “pulling the thread” to reveal the next obvious step [00:21:22].
- Increase Information Transparency: Share financials, conversion rates, and profit margins with the entire company. This allows everyone to align with the business’s priorities and help solve problems more effectively, overcoming the irrational fear of sharing sensitive information [00:21:54].
- Review Team Agendas: Regularly ask team members to show their current workload. This helps identify tasks from weeks or months ago that might still be consuming their attention but are no longer relevant due to shifting priorities [00:23:05]. Giving clear direction and permission to table less important items reduces anxiety and enhances focus [00:23:42].
Consequences of Poor Prioritization
Many businesses end up with a “graveyard of half-built bridges” [00:17:46]. They invest resources into many projects but never complete any, failing to get dollars “across to the other side into their bank account” [00:18:03]. This lack of focus on completion leads to significant financial losses [00:18:09].
Consistently pursuing easy “wins” instead of big, impactful ones results in a “continuous parade of little wins [that] never moves the ball forward” [00:20:19], preventing true breakthroughs and growth [00:20:21].