What is The Compound Effect?
The Compound Effect is the principle of reaping huge rewards from a series of small, smart choices.
— Darren Hardy, The Compound Effect
The idea behind The Compound Effect is that small, consistent actions, when repeated over a long enough period of time can lead to astonishing results. Furthermore, these small actions—when performed consistently—can also have far greater payoffs than trying to take on huge, effortful, changes over shorter periods of time. Allow me to illustrate…
Let’s say you haven’t exercised in years.
One day, you get inspired and decide to make a change.
You put on your running clothes, slam 400 shots of Columbian espresso, and hit the pavement.
You run and you run and you run some more.
In fact, you run so hard, so fast, and for so long, that by the time you get home and the runner’s high goes away, you feel absolutely depleted.
Totally wiped.
And by the time you wake up the next morning, your legs are so sore it’s a struggle to sit down for a relaxing number two.
Now, let me ask you something…
On what planet would this motivate you to want to go back out there for another run?!
What if, instead of trying to become Usain Bolt overnight, you decided to take a more sustainable approach to your health and fitness?
What if you ran a quarter mile each day for a week and built your way up from there?
What if you ran that quarter mile today, and let yourself look forward to doing it again tomorrow?
Don’t you think you’d be in better shape if you did a little bit each day rather than everything in one day?
Small steps daily will get you further than taking giant leaps randomly.
Most folks run into one (or both) of the following two problems when they’re trying to make a change:
- Get inspired → take massive action → burn out (because it’s unsustainable.)
- Take small consistent actions → don’t see results fast enough → give up.
The first problem is most common.
The second problem is caused by a lack of patience.
And the principle of the compound effect can solve both.
Let’s take it one by one:
Problem #1.
Get inspired → take massive action → burn out.
When you get all pumped up and inspired about making a major transformation in life, it’s natural to want to do as much as you possibly can to make that change… But as you learned earlier, that leads to burnout—because no one’s capable of running at top speed forever.
Solution: Break it down and make it manageable.
If you want to start a running habit, avoid running a marathon on Day 1. Instead, start by running a little bit each day and building from there.
If you want to write a book, don’t attempt to write the whole thing in a single sitting. Instead, start by writing the introduction today, page 1 tomorrow, page 2 the next day, and slowly add more from there.
What about the second problem?
Problem #2.
Take small consistent actions → don’t see results fast enough → give up.
Let’s say you decide to start lifting weights to put on more muscle. You put a plan together and start hitting the gym five days a week.
Week 1 goes by and you feel great about how you’re sticking to your game plan.
Week 2 goes by and you’re still optimistic, but wondering why you’re not packing on more muscle.
Week 3 goes by and you start wondering whether it’s worth it to keep working so hard when you’re not seeing any results.
Week 4 goes by and it’s more of the same—so your start doubting yourself.
Once Week 5 rolls around, you skip the gym for the first time since you started your new workout routine.
And by Week 6, you’ve skipped four gym sessions.
By the time Week 7 rolls around, you’ve given up—rationalizing that you gave it your all and still got no results.
Seven weeks might sound like a lot, but it isn’t even two months. It takes years to build a strong physique.
If you do everything right, but lack patience, you WILL NOT reap the benefits of the compound effect.
Solution: Stay consistent + remain patient. The greatest payoffs come to those who play the long game.
The small choices we make every day have a profound impact on the results we experience in the future.
At first, we don’t see much of a difference; weeks and months go by and everything looks relatively the same.
But give it a year or two and the changes can blow you away.
The Compound Effect is a game of patient perseverance.
Stay with it for long enough and the pay off will come.
The Compound Effect Formula
Here’s a simple formula to keep in mind:
Small, Smart Choices + Consistency + Time = RADICAL DIFFERENCE
Watch what happens when you apply the compound effect formula to different facets of life:
- If you took a single penny and doubled it every day for 31 days, you’d have a larger payoff than taking $3 million in cash today. (Grab a calculator and test it out for yourself.)
- If you commit to reading a personal development book for just 10 minutes a day, you could finish 10, full, 300-page non-fiction books within the span of a year.
- If you cut a single soda (140 cal) out of your daily diet for one year, you’d lose 14 pounds. Compare that to crash-dieting for a week to lose the same amount of weight.
- If you spend just 15 minutes a day learning a new professional skill, you’ll have over 91 hours of training under your belt within a year—putting you leaps and bounds ahead of your colleagues who attend a standard training workshop just once a year (if that).
Small choices, acted upon consistently, over a long enough timespan can radically transform your life.
That’s what the compound effect is all about.
Actionable insights
- What are at least three small choices you could be making on a daily basis, that could compound into positive changes for you in the future? Write them down, and get committed.
