How Great Leaders Handle Bad News
What Leila Hormozi & I learned the hard way about leading during tough times
On the last Operator Podcast Leila and I uncovered something fascinating: the biggest constraint to scaling isn't hiring more people. It's developing the people you already have.
Both of us learned this lesson expensively.
Having built large and small companies across multiple industries, Leila and I zeroed in on one important thing: the moment you stop developing leaders, growth stops with you.
OK… meh: That is such a fluffy and vague statement.
What does it actually mean??
It means that we have never been taught how to be good leaders and there is a better way than just doing everything through the school of hard knocks.
Here are the five CEOs mistakes that kill growth, and some tactical and practical ideas on what to do instead.
Mistake #1: Delegating Tasks Instead of Skills
What most leaders do: "Hey Jimmy, go have that tough conversation."
What happens: Jimmy comes back defeated, you handle it yourself, delegation dies.
The real cost if you don't fix this:
You become the bottleneck for every difficult conversation in your company.
Your calendar fills with "quick chats" that should be handled two levels down.
Your best people start leaving because they never learn how to navigate conflict.
You're working 70-hour weeks while your team sits around waiting for you to handle basic leadership tasks.
I see this everywhere.
CEOs complaining about being stuck in operations when really they just never taught anyone else how to do the hard stuff.
Gentle reminder:
Your job as the CEO is not just to hire good people and get out of the way. That’s only half-correct because you listened to a smart dude say it on Instagram and now you think that’s the gospel.
Your job as the CEO is to hire good people and train them to do good work… then get out of the way. That’s the correct answer.
What Leila and I do instead: "Hey Jimmy, want to role-play that conversation first?"
During our chat, Leila shared her approach: "I will Coach you to have the conversation. I will support you to have the conversation. I will jump on the call with you. But there is no scenario where I have the conversation for you."
The Game-Changer: Before selling our last company to Douglas Elliman, my partner Peter and I would walk around Central Park for three hours every morning, 5-8 AM, role-playing the questions that the board could ask us…. "What would you say if they asked you about X?"
That's what you call practice.
As you can imagine, at the meeting when the board members actually asked questions that we'd rehearsed, we'd catch each other's eye and smile. We'd already been there. We had already practiced… and that is why we were ready.
Mistake #2: Telling Instead of Showing
The brutal reality: If you're just telling people what to do without showing them how, you're basically setting them up to fail and then getting frustrated when they do.
What happens when you don't fix this:
Your team becomes afraid to make decisions.
They second-guess everything.
They come to you for permission on stuff they should own.
Your company moves at the speed of your availability, not the speed of opportunity.
Innovation dies because nobody knows how to think like you do.
It's like teaching someone to drive by just explaining the theory. Good luck with that.
As Leila put it during our conversation: "When people are teaching others to have hard conversations, they're telling them, not showing them. Then they say 'go ahead, go fire that person' and wonder why it goes sideways."
The Show-Don't-Tell Framework:
Demonstrate the behavior first
Document what you did and why
Duplicate through guided practice
Real Example: When Leila's team hated a new product rollout, she didn't send a memo. She owned the failure publicly, explained her fix, and showed the new approach in real time.
Speed + ownership turned a disaster into a trust-building moment.
Mistake #3: Skipping the Emotional Prep
Here's what kills most announcements: Leaders think about the logic but ignore the emotions. They craft perfect presentations and wonder why people resist the elegantly framed logical presentations.
Yo, you are talking to humans… not bots.
The cost of getting this wrong:
Your team feels blindsided by changes.
They interpret decisions as random or political.
Good people start updating their LinkedIn profiles.
Every company meeting becomes a damage control session instead of an alignment opportunity.
I learned this the hard way when we announced a major policy change and half the team thought we were preparing to sell the company. We actually weren't. But I never addressed their fears, so they made up their own story.
That’s why I use this framework that I learned this from my coach Taki Moore.
The FFWA Communication Filter (something we both use before any major announcement):
Fears: What keeps people up at night about this change?
Frustrations: What's already broken that this might make worse?
Wants: What are people explicitly asking for?
Aspirations: How does this connect to their bigger goals?
Key Question: Do they need a new process or a new perspective?
I’d steal this diagnostic question immediately… it will help you design an elegant path for almost anything that you are working on.
Because… most of the resistance happens because you're solving the wrong problem.
It's actually kinda wild… People quickly reject process when they need perspective shifts. They ignore perspective when they need a concrete processes.
Mistake #4: Creating Pressure Instead of Safety
What happens when delegation feels scary: People freeze… because a confused mind stalls. This pushes them into a fear state where they over-prepare for weeks, then under-deliver because they're terrified of messing up. Your high-performers start avoiding stretch assignments. Worst of all, your culture becomes risk-averse, which is… no bueno.
The long-term damage:
You end up with a team of order-takers instead of problem-solvers.
When you're not around, nothing important happens.
Your company can't scale because everyone needs constant reassurance.
And you feel like you can never take a day-off.
The Gift of Going Second transforms delegation:
Instead of "figure it out," try: "Let me show you how I'd approach this, then you can adapt it your way."
Why this works:
They hear your language patterns
You hear their concerns
The second time is always easier
Psychological safety increases dramatically
As I told Leila: "There's no pressure around role-playing. You give them the gift of going second."
Mistake #5: Waiting During Crisis
The Speed-Truth Principle: Bad news doesn't get better with time.
What happens when leaders go silent during crisis:
Nature hates a vacuum. If you don't tell your story, someone else will.
Rumors spread faster than facts.
Your team loses confidence in your leadership.
Competitors position themselves as the stable choice.
Recovery takes 3x longer because you're fighting perception, not just reality.
And the worst part is that you are spending time fighting a non-revenue generating battle which saps everyone’s energy and makes lawyers rich.
During COVID, I watched entire industries get redefined by whoever spoke first and most clearly about what was happening.
Last year when the NAR lawsuit hit the real estate industry, I posted immediately: "Join this Zoom. I'll walk you through everything."
I had no plan. None whatsoever.
I didn't know what I was going to say.
I just knew that the industry was freaking out, someone had to tell them there was a clear path forward, and speed of announcement was more important than perfection of presentation.
What Leila and I discovered: Industry crises create the biggest leadership opportunities if you move first. While competitors went silent, we became industry voices during uncertainty.
The Crisis Response Framework:
Own the narrative before others write it
Lead with facts, not feelings
Give people specific actions to take
Follow through publicly
The Meta-Pattern
Here's what Leila and I both realized: delegation isn't about getting things off your plate. It's about developing people who can eventually replace you in conversations that matter.
But to do this we have to understand how people learn and do things.
We have to hack behavior.
That's why I tried to codify this for myself many years ago, and I called it the Learning Dogma.
The Learning Dogma:
Discover something: Learn it once
Teach something: Learn it twice
Document something: Learn it forever
When you document your role-playing sessions, coaching conversations, and crisis responses, you create reusable frameworks (to think) and systems (to do) that scale beyond individual relationships.
The compound effect: Every person you develop properly becomes a multiplier. Every crisis you handle transparently becomes institutional wisdom. Every difficult conversation you role-play becomes organizational muscle memory. That’s the mega flex in all of this.
It's actually quite magical when you see it all come together.
If you run a company or lead a team, you should watch this video:
The 24-Hour Rule
How CEOs Get It Wrong
The Coldplay Kiss Cam Incident
Trust Is the Leader’s Currency
Why Teams Stop Trusting You
Hiring A-Players Without Big Budgets
How to Have Hard Conversations
Upgrade Your One-on-One Meetings
Stop Doing Low-Value Work
Protect Your Reputation at All Costs
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