Alex Hormozi: Simple Operational Framework

Last updated: Jun 14, 2023

The video is about Alex Hormozi's simple operational framework for structuring operations in a business, which involves listing out desired outcomes and allocating activities to specific roles and times on a calendar.

This video by Alex Hormozi was published on Oct 15, 2020.
Video length: 14:07.

In this video, Alex Hormozi discusses his simple operational framework for structuring operations in a business.

He emphasizes the importance of understanding the desired outcomes and listing out the activities required to achieve them, using the example of a fitness business. Hormozi suggests allocating time for each activity on a calendar and dividing tasks among team members to scale the business.

He also notes that many entrepreneurs overlook the importance of operations, which can be a key factor in their success or failure.

  • Operations are often overlooked by entrepreneurs.
  • Operations are crucial to the success of a business.
  • Successful entrepreneurs prioritize operations.
  • List out desired outcomes that need to happen.
  • Allocate activities based on the time available for each role.
  • Expect people to be perfectly efficient.
  • Listing out activities provides immense clarity in understanding what needs to occur in the business to make more money.

Simple Operational Framework (ALEX HORMOZI) - YouTube

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Introduction

  • Operations are often overlooked by entrepreneurs
  • Operations are crucial to the success of a business
  • Entrepreneurs often focus on marketing and sales
  • Successful entrepreneurs prioritize operations
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Desired Outcomes

  • List out the desired outcomes that need to happen
  • Think of business as a pipeline from click to close to resell
  • Allocate activities based on the desired outcomes
  • For each outcome, list the activities required to achieve it
  • Allocate time for each activity based on current inflow
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Calendar Allocation

  • Look at a calendar for each role in the company
  • Allocate time for each activity in the calendar
  • Allocate activities based on the time available for each role
  • Place activities on the calendar for each hour of the day
  • Allocate activities based on the ratio of customers to activities
Alex Hormozi: Simple Operational Framework 005

Simple Operational Framework (ALEX HORMOZI) - YouTube

Example: Online Fitness Business

  • Four main outcomes: demand gen, legion, lead nurture, and ascension
  • Allocate time for first sales calls to get new customers
  • Allocate time for onboarding, including nutrition orientation and tech walkthrough
  • Allocate time for ascension conversation to sell customers into continuity
  • Allocate time based on the number of customers being brought in each week
  • Eventually, allocate activities to different people to scale the business
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Allocating Activities to Specific Roles and Times

  • Block entire pieces of activity to the next person.
  • List out desired outcomes.
  • Allocate activities to specific roles and times on a calendar.
  • Look at someone's schedule and block out times for specific activities.
  • Allocate time for recruiting coaches and fulfillment.
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Availability and Time Allocation

  • Availability becomes interesting when scheduling new customer onboarding conversations.
  • Have slots on different days and times to give customers options.
  • Allocate time for nutrition orientation.
  • Allocate time for creating content, outreach, or expanding capacity.
  • Allocate time for exit meetings and transformation meetings.
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Efficiency and Utilization

  • Expect people to be perfectly efficient.
  • Allocate time for managing ongoing fulfillment, onboarding activities, and back-end meetings.
  • Find inefficiencies where partial roles are getting full-time pay for half-time work.
  • Be more efficient by knowing what activities need to occur in the business to make more money.
  • Know how long each activity could take and how many of them you have based on inflow and customer base.
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Clarity and Understanding

  • Listing out activities provides immense clarity in understanding what needs to occur in the business to make more money.
  • Knowing the list of activities helps determine how long each activity could take.
  • Knowing inflow and customer base helps accurately determine what an ideal day looks like for each role within the business.
  • Allows for more efficient allocation of time and resources.
  • Helps identify valuable and non-valuable activities.
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Section 1: Alex Hormozi's Operational Framework

  • Alex Hormozi's operational framework involves listing out desired outcomes and allocating activities to specific roles and times on a calendar.
  • He believes that this framework allows businesses to account for all the things that need to happen in the business and ultimately allows for a more efficiently run shop.
  • He suggests that businesses should think about operations in terms of activities and units of time and expected inflow.
  • Based on those three variables, businesses can account for all the things that need to happen in the business and will ultimately allow for a more efficiently run shop.
  • He believes that the most successful businesses are those that are willing to do the boring work, roll up their sleeves, and focus on the repetitive work, meetings, and training their team on improving how good they are doing things.
  • He suggests that businesses should focus on culture and tolerance of the leader to propel the company forward.
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Section 2: How to Implement the Operational Framework

  • Alex Hormozi suggests that businesses should have their employees take a time study to get a baseline of what all the activities are.
  • A time study involves having an excel sheet with every 15 minutes of the day and having employees write down what they did for each of those 15 minutes.
  • Businesses can use the time study to see where there are inefficiencies or additional tasks that they are not accounting for that their employees are doing.
  • Businesses can also use the time study to see if someone is being dishonest about their activities.
  • Once businesses have a baseline of all the activities, they can deem whether they are valuable or not and decide whether they want their employees to keep doing them or not.
  • Businesses can use the operational framework to structure different roles within the company by first looking at the outcomes they want, the activities needed to generate those outcomes, and how long those activities take per customer per unit.

Watch the video on YouTube:
Simple Operational Framework (ALEX HORMOZI) - YouTube

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