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Fix This Next

Fix This Next

Pinpoint and Solve Your Company's Biggest Problem
by Mike Michalowicz 2020 288 pages
4.21
687 ratings
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Key Takeaways

1. Instinct is a poor compass for business problems.

The biggest problem business owners have is that they don’t know what their biggest problem is.

Overwhelmed by problems. Business owners constantly face a barrage of issues, feeling buried and paralyzed by the multitude of choices. The natural instinct is often to react to the loudest problem or revert to familiar, but ineffective, solutions like simply trying to increase sales. This "fire-extinguisher mode" leads to a cycle of addressing apparent issues without making real progress.

Instinct vs. reality. Relying solely on gut feeling in business is like Amanda Eller getting lost in the Hawaiian woods despite her "internal guide." Just as she needed a compass, business owners need a reliable tool because our instincts, while helpful in personal safety, are not wired to diagnose complex business needs. Repeatedly applying the same "fix" harder, like hitting a jammed printer, won't work if you're addressing the wrong core issue.

The Survival Trap. This reactive approach often leads to the Survival Trap, where entrepreneurs take panicked actions just to stay afloat today, repeating the pattern tomorrow. They patch up obvious problems, leading to burnout, financial strain, and a demoralizing cycle of temporary relief followed by renewed struggle, never truly moving the business forward in a sustainable way.

2. All businesses share the same fundamental DNA.

Your business is 99.9 percent identical to all others—just as they are nearly identical to yours.

Beyond the surface. While businesses may appear vastly different on the outside – a farm versus a pharmacy, a small startup versus a multi-million dollar corporation – their underlying biological makeup is nearly identical. The unique qualities are like the "skin" of the business, important for differentiation and attracting ideal customers, but the core functions and challenges are universal.

Universal problems. Even highly successful, large companies face the same fundamental issues as small businesses: cash flow problems, hiring challenges, profitability struggles, and confusion over what to prioritize next. A $22 million industry leader can be just weeks away from financial collapse if these core needs aren't met, demonstrating that size or revenue alone doesn't guarantee health.

Focus on biology. Instead of believing your business is uniquely complex and immune to simple solutions, recognize its shared DNA. The methods for achieving growth and sustaining health are remarkably similar across industries. Understanding this allows you to apply proven systems and strategies, rather than getting stuck believing your situation is too special for standard approaches.

3. The Business Hierarchy of Needs (BHN) maps essential business health.

Looking at Maslow’s hierarchy of needs, I realized that it has a direct correlation to entrepreneurial progress...

Inspired by Maslow. Just as humans must satisfy basic physiological needs before pursuing safety, belonging, esteem, and self-actualization, businesses have a hierarchy of needs that must be met sequentially for healthy growth and fulfillment. This structure provides a logical order for addressing challenges, moving from foundational survival to higher-level purpose.

Five levels of needs. The BHN consists of five levels, each with five Core Needs:

  • SALES: Creating cash (Lifestyle Congruence, Prospect Attraction, Client Conversion, Delivering on Commitments, Collecting on Commitments).
  • PROFIT: Creating stability (Debt Eradication, Margin Health, Transaction Frequency, Profitable Leverage, Cash Reserves).
  • ORDER: Creating efficiency (Minimized Wasted Effort, Role Alignment, Outcome Delegation, Linchpin Redundancy, Mastery Reputation).
  • IMPACT: Creating transformation (Transformation Orientation, Mission Motivation, Dream Alignment, Feedback Integrity, Complementary Network).
  • LEGACY: Creating permanence (Community Continuance, Intentional Leadership Turn, Heart-based Promoters, Quarterly Dynamics, Ongoing Adaptation).

Building floor by floor. A business doesn't progress linearly through stages; it moves up and down the hierarchy, constantly shoring up lower levels to support higher ones. Focusing on a higher-level need like Impact when foundational Sales or Profit needs are unmet is like trying to build a third floor when the basement is crumbling – the structure will eventually collapse.

4. Use the Fix This Next (FTN) analysis to pinpoint your single Vital Need.

Within any business process... there will always only ever be one link that is the weakest.

Find the weakest link. The FTN analysis is a simple, four-step process designed to identify the single most crucial Core Need – the "weakest link" or "constraint" – that, when fixed, will unlock the greatest forward momentum for your business at any given moment. You can't force a different link to be weakest; you must find the one that naturally is.

The 4-step process:

  1. Identify: Go through the BHN levels from bottom up, checking off Core Needs your business adequately meets.
  2. Pinpoint: Find the lowest level with unchecked needs and circle the most crucial unchecked need at that level – this is your Vital Need.
  3. Fulfill: Develop and implement measurable solutions specifically for that circled Vital Need until it is adequately addressed.
  4. Repeat: Once the Vital Need is fixed, go back to Step 1 and repeat the process to find the next Vital Need.

Clarity in minutes. This methodical approach replaces guesswork and instinct with deliberate action. Entrepreneurs like Tersh Blissett found their Vital Need (Prospect Attraction) in just five minutes using the FTN analysis, allowing them to focus their energy effectively and achieve remarkable results quickly, demonstrating the power of addressing the right problem next.

5. Measure progress and ensure fixes stick with the OMEN method.

The answer is: you don’t know instinctually. So the only way to be sure that your solution worked is to measure it.

Numbers don't lie. Unlike relying on gut feeling or hoping for the best, using measurement provides objective proof of whether your fix is working. Just as a scoreboard tells you if you're winning, metrics reveal if your efforts are driving progress towards your objective.

The OMEN framework. To effectively measure and manage the process of fixing your Vital Need, use the OMEN method:

  • Objective: Define the specific, desired outcome for your Vital Need and its baseline.
  • Measurement: Determine the simplest, most effective metric(s) to track progress within a specific timeframe.
  • Evaluation: Set the frequency for reviewing your measurements and assessing progress.
  • Nurture: Regularly review and tweak the objective, measurements, or approach based on the data.

Scaffolding for success. OMEN acts as scaffolding around your Vital Need, providing structure and focus until the fix is complete. Once the objective is achieved, the intense scrutiny can be removed, leaving behind key metrics to monitor sustained results. This disciplined approach ensures that fixes are not just attempted, but successfully implemented and maintained.

6. Master the foundational "Get" levels: Sales, Profit, and Order.

Businesses that ignore the “get” foundation of the BHN (SALES, PROFIT, and ORDER) and focus on “give” (IMPACT and LEGACY) first are destined for perpetual struggle at best, or a quick demise, most likely.

The essential foundation. The first three levels of the BHN – Sales, Profit, and Order – represent the "Get" phase of business. These are the fundamental needs for survival, stability, and efficiency. Without a strong foundation in these areas, any attempts to build higher levels of Impact or Legacy will be unsustainable.

Sales is more than a handshake. The Sales level is about creating cash flow through the entire client agreement process, from connection and agreement to delivery, collection, and conclusion. Needs include ensuring sales support your lifestyle (Lifestyle Congruence), attracting the right prospects (Prospect Attraction), converting them effectively (Client Conversion), delivering on promises (Delivering on Commitments), and collecting payment (Collecting on Commitments).

Profit ensures stability. The Profit level focuses on creating financial health and security. This means consistently eradicating debt (Debt Eradication), maintaining healthy margins (Margin Health), encouraging repeat business (Transaction Frequency), using debt strategically for predictable returns (Profitable Leverage), and building cash reserves (Cash Reserves) to weather storms and seize opportunities.

Order drives efficiency. The Order level is about creating operational efficiency and autonomy. This involves minimizing wasted effort (Minimized Wasted Effort), aligning people with roles suited to their talents (Role Alignment), empowering those closest to problems to solve them (Outcome Delegation), ensuring the business can run without key individuals (Linchpin Redundancy), and being known as the best at what you do (Mastery Reputation).

7. Elevate your purpose by building the "Give" levels: Impact and Legacy.

You must nail the foundation of SALES, PROFIT, and ORDER so that you can then give back to the world through IMPACT.

Getting enables giving. Sustainable giving is only possible from a position of strength. Businesses must first master the "Get" levels (Sales, Profit, Order) to generate the resources and stability required to make a meaningful and lasting impact on the world. Trying to focus on Impact or Legacy without this foundation leads to burnout and failure.

Impact is transformation. The Impact level is about moving beyond simple transactions to create transformation for clients, employees, vendors, and the community. Needs include ensuring your offering provides a transformation beyond the basic transaction (Transformation Orientation), motivating your team by the mission (Mission Motivation), aligning individual dreams with the company vision (Dream Alignment), fostering open feedback (Feedback Integrity), and collaborating with others serving your customer base (Complementary Network).

Legacy is permanence. The Legacy level focuses on ensuring the business and its impact continue permanently, beyond the founder's active involvement. This means building a community that supports the business (Community Continuance), planning for leadership transitions (Intentional Leadership Turn), cultivating passionate promoters (Heart-based Promoters), dynamically adapting to change (Quarterly Dynamics), and designing the business for continuous improvement (Ongoing Adaptation).

8. True Legacy is the business thriving permanently without you.

Legacy is not about you. It is about what you leave behind.

Stewardship, not ownership. At the highest levels of the BHN, the focus shifts from personal accumulation and control to ensuring the organization's mission and positive impact live on. This requires the founder to transition from being the indispensable operator to being a steward, designing the business to function and evolve independently.

Beyond the founder. A true legacy business is one whose purpose and operations are no longer solely tied to the founder's personality or presence. Companies like Coca-Cola or Apple continue to thrive long after their founders are gone because they built systems, culture, and a community that perpetuate the mission. This requires intentional planning for leadership turns and fostering heart-based promoters.

Designed for adaptation. Leaving a permanent legacy means building a business capable of ongoing adaptation. The market, technology, and customer needs constantly change. A legacy business is designed with quarterly dynamics and a culture of continuous improvement, ensuring it can reinvent itself as needed to remain relevant and impactful for generations to come.

Last updated:

Review Summary

4.21 out of 5
Average of 687 ratings from Goodreads and Amazon.

Fix This Next receives mostly positive reviews for providing a clear framework to prioritize business needs. Readers appreciate the Business Hierarchy of Needs concept, which helps entrepreneurs focus on critical issues. Many find the book practical and actionable, praising Michalowicz's relatable writing style. Some criticisms include repetitiveness and lack of depth in certain areas. Overall, reviewers recommend the book for its valuable insights on business prioritization, though some suggest it's more beneficial for new entrepreneurs than experienced ones.

Your rating:
4.59
4 ratings

About the Author

Mike Michalowicz is an entrepreneur and author known for his practical business advice. He has written several popular books on entrepreneurship, including "Profit First" and "The Pumpkin Plan." Michalowicz draws from his personal experiences as a business owner to create actionable strategies for other entrepreneurs. His writing style is often described as engaging and humorous, making complex business concepts accessible to readers. Michalowicz's approach focuses on simplifying business operations and prioritizing profitability. He is recognized for his ability to break down common business challenges and provide step-by-step solutions. His books have gained a following among small business owners and entrepreneurs seeking practical guidance for growth and success.

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