Fix This Next

Have you ever felt overwhelmed by your business—unsure which fire to fight next or wondering whether your efforts are making a difference? In Fix This Next, Mike Michalowicz argues that most entrepreneurs aren’t struggling because they lack energy or ideas; they’re struggling because they don’t know what to fix first. Entrepreneurs, he says, spend far too much time chasing urgent problems and emotional instincts instead of diagnosing their company’s true underlying need. His mission in this book is to give you a simple compass—a framework that tells you where your business is really jammed and how to direct all your resources toward fixing that next vital thing.

The Core Argument: Why Gut Instincts Fail

Michalowicz opens with stories from his own career—running multiple multimillion-dollar businesses, nearly losing them through debt, and finally realizing that his instincts were causing the problems. Like a printer jammed with paper, he kept pulling harder on the wrong lever until something broke. The same happens to entrepreneurs: when sales slump, we try harder to sell; when stress mounts, we double our hours. But those efforts often make the problem worse. His breakthrough was seeing that businesses, like humans, have a hierarchy of needs. Profit issues, organizational chaos, or mission fatigue are not isolated; they represent different levels of wellness that must be treated in sequence. Without clarity on where your weakest link lies, every fix is guesswork.

The Business Hierarchy of Needs

He adapts Abraham Maslow’s famous hierarchy of human motivation to the world of entrepreneurship. Just as humans must secure food, safety, love, and purpose in order, businesses must stabilize their five fundamental domains. These are: Sales (the creation of cash), Profit (the creation of stability), Order (the creation of efficiency), Impact (the creation of transformation), and Legacy (the creation of permanence). Within each level are five “core needs”—twenty-five indicators that make up the entire anatomy of a business. They range from basic concerns like attracting prospects and collecting payments to advanced questions about building community or ensuring leadership transition.

Michalowicz’s Guiding Principle

“The biggest problem business owners have is that they don’t know what their biggest problem is.” The book’s entire method is built around locating that one missing puzzle piece—the Vital Need—and fixing it before anything else.

Introducing the Compass: The Fix This Next Analysis

To use this compass, Michalowicz presents a four-step diagnostic process. First, identify which core needs are satisfied in each level. Second, locate the lowest level where needs are missing—that’s where your foundation is cracked. Third, choose the most vital unsatisfied need to address immediately. Fourth, once you’ve fixed that, repeat the process. This cycle becomes the entrepreneur’s lifelong management routine, allowing you to elevate your company systematically rather than by intuition or panic. (Note: This method filters emotional noise—it’s less about getting more done and more about doing what actually matters.)

The Mindset Shift: From Firefighting to Direction

Michalowicz compares entrepreneurs to exhausted firefighters and survivalists—their energy spent reacting to crises instead of designing better systems. The Fix This Next tool forces a pause: a moment of clarity that reveals which one thing will unlock healthy forward movement. The author’s mantra, “Don’t trust your gut, trust your compass,” reminds readers that intuition can’t sense financial, operational, or strategic misalignment the way this diagnostic can. His case studies—from HVAC installers to coffee shop owners—demonstrate that clarity comes not from brainstorming new ideas but from pruning distractions and isolating a single fix.

Why This Framework Matters

Michalowicz’s message lands because it solves a universal entrepreneurial pain: being busy yet stagnant. By following his hierarchy, you not only regain control but also transform frustration into structured progress. This method works for any business size, industry, or stage—from startups chasing first cash flow to global firms seeking succession. Ultimately, Fix This Next is both a practical roadmap and a philosophical shift: your business is not built on instinct but on sequence. You must first get right (Sales, Profit, Order) before you can truly give back (Impact, Legacy). The reward isn’t just more success—it’s sustainable fulfillment, the kind that lets you leave work each day knowing you strengthened the right link in your chain.

At the heart of Michalowicz’s approach lies his Business Hierarchy of Needs (BHN), a map for diagnosing your organization’s health. Adapted from Maslow’s hierarchy, it reframes business challenges as progressive levels of wellness. Each level builds upon the one below, and if any lower need is weak or neglected, the higher aspirations collapse. Think of this as architectural scaffolding—you can’t install a penthouse on a crumbling basement.

Sales: Creating Cash

This is the oxygen of business. Without reliable revenue, nothing else survives. Michalowicz defines five core needs: ensuring sales match your desired lifestyle, attracting ideal prospects, converting them effectively, delivering on promises, and collecting payments. Many entrepreneurs mistake high revenue for success, but he demonstrates through his own story—bankrupt despite millions in sales—that growth without discipline is dangerous. Sales must align with your life’s comfort level and business capacity.

Profit: Creating Stability

Profit represents safety. It’s the buffer between survival and collapse. Its five needs include eradicating debt, maintaining healthy margins, encouraging repeat transactions, leveraging debt for gain (not maintenance), and building cash reserves. Michalowicz’s Profit First system lives here: setting aside profit before paying expenses ensures fiscal resilience. (Like Maslow's “shelter and safety,” this level shields you from external shocks.)

Order: Creating Efficiency

Order gives the business autonomy. This is where systems replace chaos. Roles align with talent, bottlenecks shrink, and operations become self-sustaining. Michalowicz insists entrepreneurs should design their companies to run without them; otherwise, they have a job, not a business. He encourages owners to test “four-week vacations”—if things crumble while you’re gone, you haven’t achieved order yet.

Impact and Legacy: Creating Meaning and Permanence

The upper levels transform good businesses into great ones. Impact focuses on changing lives—creating transformation beyond the transaction. Legacy ensures the business outlives you, with a community-driven continuation, dynamic leadership turnover, and the capacity to adapt indefinitely. Michalowicz argues that these stages fulfill your entrepreneurial potential: when your company uplifts others and keeps thriving without you, you’ve reached business self-actualization. He cites examples from Coca-Cola to Burt’s Bees, illustrating how founders who prepared for continuity created brands that endured beyond them.

Michalowicz’s hierarchy is not a ladder; it’s a loop. Every time your company grows or pivots, you revisit the base levels to reinforce them, ensuring long-term strength and balance.

The central skill in Fix This Next is identifying your Vital Need—the single problem whose resolution will most strengthen the foundation and accelerate growth. Michalowicz compares this to finding the weak link in a chain: when you fix it, the entire chain becomes stronger. To uncover it, he introduces the Fix This Next Analysis, a diagnostic checklist that eliminates guesswork.

Four Steps for Discovery

• Identify which needs are truly satisfied at each hierarchy level.
• Pinpoint the lowest level where unchecked needs remain.
• Fulfill that necessity—focus all energy there.
• Repeat the process once the fix stabilizes.

Michalowicz illustrates this through Tersh and Julie Blissett, owners of IceBound HVAC. Despite $750,000 in revenue, they struggled with inconsistent cash flow. Their gut said their next fix was increasing charitable impact; their compass revealed their true weak link: attracting the right prospects. By redefining their client avatar—dual-income, empty-nest homeowners who valued comfort—they quadrupled sales quality and nearly doubled ticket size within months. One fix, properly targeted, created exponential results.

Objective, Measurement, Evaluation, Nurture (OMEN)

Once you’ve found your Vital Need, you must tackle it strategically. Michalowicz’s OMEN framework borrows from Intel’s Objective-Key-Result system (popularized in John Doerr’s Measure What Matters). Each fix includes:

• A clear Objective: the outcome you want.
• Simple Measurements: tangible metrics that show progress.
• An Evaluation schedule: how often to review the data.
• A Nurture plan: space for adjustments as you learn.

This process turns problem-solving into continuous learning. For example, Michalowicz recounts using OMEN after his own failed college party (yes, the infamous grain-alcohol Kool-Aid fiasco) to demonstrate how outcomes improve when goals are measurable. Business fixes, too, must be observable, not hopeful. Numbers don’t lie—but emotions often do.

Michalowicz insists that before chasing lofty missions or innovations, your company must master Sales and Profit. These two levels represent the “Get” stage—the base that funds all future giving. His stories of early failure reveal how obsession with growth can destroy cash flow unless it aligns with personal and business stability.

Sales: Clarify and Constrain

He breaks sales into five stages—from connection to conclusion—and shows how entrepreneurs stumble when they equate sales volume with success. The key is predictable revenue that matches your lifestyle congruence. You must know how much income you truly need to live comfortably, and reverse-engineer revenue targets from there. Arbitrary goals create stress without improvement. His example of determining a “comfort number” lets owners set clear, achievable income thresholds that drive sustainable growth.

Profit: Choose Reward Over Reinvestment

Profit isn’t money you someday reinvest; it’s cash you can use now without harming operations. Michalowicz echoes his earlier book Profit First: every business should allocate profit before paying expenses. Profit is a reward for entrepreneurial risk—a thank-you for betting your time and sanity on creation. He recounts his near-bankruptcy from ignoring this principle and how restructuring expenses around a permanent profit allocation finally secured 45 consecutive quarters of payouts. Like Dave Ramsey’s debt snowball, small wins compound into unstoppable momentum.

From Fragile Growth to Fiscal Health

Together, these foundations transform “entrepreneurial poverty” into fiscal independence. Michalowicz’s guiding insight: you cannot scale compassion without cash. Getting must precede giving. Sales bring oxygen; profit builds muscle. Only then can your business pursue higher ambitions—impact, legacy, creativity—without collapsing under its own weight.

After you secure cash and profit, Michalowicz says your next mission is achieving organizational order—designing a company that can run without you. This stage liberates owners from perpetual burnout and gives employees the autonomy to excel. Using examples from Google, Heroic Public Speaking, and Ole Miss University, he shows that efficiency and empowerment are the twin engines of lasting order.

Minimize Wasted Effort

The first step is eliminating friction. Like Uber revolutionizing taxis by removing pointless waits, leaders must identify time piles and bottlenecks—places where work queues up and dies. He urges you to keep a “bottleneck log” to track of recurring slowdowns and to empower those closest to problems to redesign processes. Efficiency is not speed for speed’s sake; it’s simplicity that frees attention.

Align Roles and Delegate Outcomes

Put people in positions where they flourish. Heroic Public Speaking’s founders, Michael and Amy Port, scaled their business rapidly by aligning roles to talent and promoting alumni into teaching positions. Likewise, Ole Miss’s campus transformation under horticulture director Jeff McManus happened because he trusted the grounds crew to innovate—trimming trees and changing mulch patterns—to beautify more efficiently. Delegating outcomes, not tasks, is crucial; it empowers creativity.

Eliminate Linchpins and Achieve Mastery

Every business must be able to function without any one person—including you. Michalowicz describes how his “favorite employee of all time,” Kelsey Ayres, became so essential that he forced her to take an eight-week sabbatical to create redundancy systems. By cross-training and documenting her work before leaving, she returned as company president. True mastery reputation—being the best in your space—comes only when roles are clear, people love their work, and no one is irreplaceable.

When the basics are secure, you move from the “Get” stage to the “Give” stage. Impact, the fourth level, transforms your operation from a money machine into a mission-driven organism. Michalowicz asserts that businesses evolve when they shift from serving customers to transforming them.

Transformation Orientation

He spotlights Erin French’s restaurant, The Lost Kitchen, where the dining experience is designed not for convenience but transformation. Guests must send physical postcards to book reservations—a ritual aligning the restaurant’s identity with patience and intentionality. Businesses focused on transformation see customers as participants in a culture, not buyers of a product.

Mission Motivation and Dream Alignment

Impact grows when everyone in the company sings the same song. Michalowicz compares this to the Navy SEALs’ famous Hell Week: unity under mission is what gets teams through adversity. He also uses stories of employees like Amy Cartelli, whose role was molded around her dream of family flexibility, proving that aligning business goals with personal purpose creates loyalty and joy. Leaders who nurture personal growth in staff amplify collective impact.

Feedback Integrity and Complementary Networks

Finally, transformation demands continuous learning—from customers and partners alike. Borrowing from bathroom-feedback buttons and his own reader emails, Michalowicz urges real-time honesty loops that keep mission and execution aligned. He praises companies like Boonton Coffee Co., which refer patrons to competitors when appropriate, demonstrating that collaboration—not dominance—is the hallmark of mature impact. (Like Brian Grazer and Ron Howard’s partnership producing stories beyond themselves, collaborative networks multiply influence.)

The highest level of Michalowicz’s hierarchy, Legacy, asks a simple but profound question: will your company matter beyond you? He reframes legacy not as fame or wealth, but as structured continuation—systems ensuring that your business continues to change lives after your departure. This level unites purpose with permanence.

Community Continuance

Michalowicz tells the story of Burt Shavitz, the cofounder of Burt’s Bees, whose brand outlived him but not his values. After selling to Clorox, he lamented that the essence of simplicity disappeared. The warning: if you don’t define your legacy intentionally, it will still happen—just not the way you want. Legacy thrives when customers defend the mission themselves, as seen in Harley-Davidson rallies or fan-led movements like Brooklyn Nine-Nine’s #SaveB99 campaign.

Leadership Turn and Adaptation

Legacy requires renewal. Michalowicz recounts being humbled when an audience member credited his book Profit First to another author—proof that his idea had transcended him. Leadership turnover and continual reinvention keep missions alive. Companies like LEGO and Netflix prosper by quarterly dynamic adjustments—reviewing strategies every ninety days to tack toward evolving winds.

Ongoing Evolution

Change is permanence’s paradox. The only way to live forever is to adapt forever. Michalowicz encourages leaders to challenge their own business models regularly, even designing “Utopia Corps”—imaginary competitor teams that could destroy their company—to inspire innovation. Legacy isn’t static; it’s the continuous loop of impact and adaptation that lets your mission outgrow your mortality. As he concludes, success brings pride, but legacy brings joy.