In this tactical episode of The Game, Alex (@AlexHormozi) explains why changing too much too fast kills growth. He unpacks the 20% drop rule, the ICE framework, and how sometimes the most scalable move is doing less.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 and will learn on his path from $100M to $1B in net worth.Wanna scale your business? Click here.Follow Alex Hormozi’s Socials:LinkedIn | Instagram | Facebook | YouTube | Twitter | AcquisitionMentioned in this episode:Get access to the free $100M Scaling Roadmap at www.acquisition.com/roadmap
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There are probably a hundred things that you have on those notes and each of them you're like, this could give me 5% more, this give me 10% more, this give me whatever. If I know them and have a 20% guaranteed cost, that whether it works or not, I'm going to have this happen, it changes what things I'm willing to take a bet on. So how was this morning? Good? Yes? Tactical? Okay, good.
That is the objective. And hopefully it puts a little more context on what I was talking about yesterday, which is, all right, there's probably a hundred questions you could have potentially asked, but ideally, or hopefully you ask the questions that you think could get you the highest return. And that's fundamentally why we laid out that way.
To frame this Q&A, I want to go over a couple small things and then we'll kind of dive into it. So one of the big ones is everyone here probably has a lot of notes from this morning and yesterday. And when you get back in your car or you go on the plane, you're going to open up your laptop, you open up your notes, and you'll probably open up some sort of fresh document and be like, okay.
What am I actually going to do? Right? Because you have all these ideas. And kind of the objective for me, when I think about how to prioritize within a business, aka strategy, it's making sure that we get those one to three things that we're going to change correct. And I want to introduce a little bit of a concept that's taken me too long to understand.
And it's really, really hard, which is this, there's a lot of things that you can do to grow the business. You have a lot of ideas that you're coming off on. And so let's imagine that this line represents your current revenue level. Whenever you make a change in the business, my estimation is that we see about a 20% decrease in revenue as a result of a change, especially if it's a manual change.
We're changing a sales process. We're changing a customer service process, something that involves humans. We're changing something that they're doing. We'll typically see a 20% decrease guaranteed simply because of the cost of change. But once I kind of like realized this, it changed what things I decided to choose to change to begin with.
Meaning there are probably 100 things that you have on those notes and each of them you're like, this could give me 5% more, this give me 10% more, this give me whatever. If I know them and have a 20% guaranteed cost, that whether it works or not, I'm going to have this happen. It changes what things I'm willing to take a bet on.
And so for me, my kind of minimum litmus test for this is I need to see at least a 20% bump or believe I can see a 20% bump from any implementation that I'm going to run, or I'm not going to take the guaranteed 20% loss.
And so part of this comes into something called ICE, which is kind of an investor terminology, but basically of impact, confidence, how likely, like how big of a difference is it going to make? How likely is that to happen? And then you've got ease, which is basically the value equation without speed.
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