Book SummaryThe Compound Effect, by Darren Hardy

1-Page Summary1-Page Book Summary of The Compound Effect

The key to success in anything in life is harnessing the power of the Compound Effect, which means the effects of small, everyday choices will compound over time, leading you to success—or disaster, depending on your choices.

As a student of success and a leader in the personal development industry, author Darren Hardy has tested thousands of different philosophies and came to realize that whatever success strategy you employ doesn’t matter—it all comes down to the Compound Effect.

The Premise of the Compound Effect

As you may know from finance, compound interest can lead to surprisingly large returns. A penny that doubles in value each day for 31 days ends up being worth over $10 million.

Similarly, in our personal life, small changes maintained consistently over time lead to unexpectedly dramatic results. Eating 100 fewer calories per day for an entire year would cause you to lose 10 pounds. Spending 30 minutes reading each day could, over a year, lead to dramatic self-improvement and new ideas.

Importantly, changes in one area of life can compound with other areas, what Hardy calls “the ripple effect.” For example, eating slightly more healthily might lead to feeling more energetic, which promotes a little more exercise, which improves your mood and personal relationships. One small change can lead to a host of other benefits, which together form a snowball of dramatic personal change.

The Compound Effect also works in reverse - one small bad habit leads to a large problem over time. And that small habit can ripple into other areas, leading to a giant snowball of bad problems. For example, eating a little too much each day could cause surprisingly large weight gain, which leads to loss of self-esteem, which leads to less energy and worsened relationships, and so on.

The idea of small changes compounding over time can be contrasted with big, sudden changes. When people try to start exercising, they often declare a big goal and start with extreme changes like going to the gym daily. But this is often unsustainable - once you miss a few appointments, you get discouraged and end the whole effort. In contrast, small changes build consistency and momentum - they form new habits that you can maintain for decades.

The concept is simple, but simple doesn’t mean easy. Each chapter in this book explores a fundamental tenet of the Compound Effect that will help you generate new behaviors and habits to propel you toward success.

Chapter One: Putting the Compound Effect Into Action

From an early age, Hardy learned the power and importance of positive habits applied consistently. He attributes his success to believing in and living the Compound Effect every day. But people face hurdles becoming a true believer in the Compound Effect because:

• They haven’t experienced it. The Compound Effect means reaping big rewards from a series of small, good choices, but the results don’t come immediately, which discourages many people from trying. To succeed, you have to be able to stick to your small, smart choices consistently over time.
• It’s a lot of work. The Compound Effect is a challenging system because it’s not about instant payoffs. Real success requires a lot of hard work with consistency, despite the shortcuts you may hear about in the media or from self-help gurus.
• They expect quick fixes. The Compound Effect dispels the idea of a quick fix. Success comes from continued effort—daily hard work and discipline compounded over time. You can create the life of your dreams, but it won’t happen overnight.

The Compound Effect is always working. Whether it’s working to bring you success or failure is up to you. Using the Compound Effect to create a better life is a matter of making simple, positive changes—and sticking with them.

Chapter 2: You Make Your Choices, and Your Choices Make You

When you’re aware of your choices, you can make a series of small good decisions that lead to the behaviors and habits that support a happy, successful life.

The real problem for most of us isn’t massive mistakes; it’s repeated small, poor choices that seem to be inconsequential. These continued small, poor choices, made mindlessly, help the Compound Effect work against you. Here are tips for making good choices:

• Gratitude. While focusing on the negative qualities of others is easy, it’s a bad habit that leads to a cycle of compounded negativity. In contrast, focusing on what you are thankful for, creates a Compound Effect of positivity.
• Take responsibility. When you take full responsibility for yourself, you hold unlimited power to control your destiny—you are completely responsible for what you do and don’t do, as well as your response to what happens...

The Compound Effect Summary Introduction

Marketing claims in the media dupe us into believing there are easy fixes for our lives, offering up the “secrets” to getting rich, looking younger, losing weight, and achieving our goals. But the truth is, there’s no quick fix to success—and there are no secrets.

Success means getting back to the profound, simple fundamentals of achievement; the key is harnessing the power of the Compound Effect, which author Darren Hardy calls the “operating system of your life.” Simply put, **the Compound...

The Compound Effect Summary Chapter 1: Putting the Compound Effect Into Action

Consistency is the key to success, but doing what you need to do on a consistent basis remains a stumbling block for many people trying to achieve their goals.

From an early age, Hardy learned the power and importance of positive habits applied consistently. He likens himself to the tortoise from the tale of the tortoise and the hare—able to win any race because of positive, consistent progress.

Raised by a single father who stressed hard work, discipline and responsibility, Hardy grew up with a “no excuses” mentality that set him up for achievement. He attributes his success to believing in and living the Compound Effect every day—something his dad made sure of.

But most people face hurdles becoming a true believer in the Compound Effect. They haven’t experienced the payoffs of the Compound Effect principle, don’t understand how much hard work is involved, and expect quick fixes. Let’s examine these hurdles and learn how to get around them to get on board with the Compound Effect.

Hurdle #1: You Haven’t Yet Reaped the Rewards of the Compound Effect

If you haven’t yet experienced the payoff of the Compound Effect, it’s hard to buy into the idea. The Compound Effect...

Shortform Exercise: Start a Compound Effect

Get started using this powerful principle.

Think about poor Brad in the example above. He made what seemed to be small, innocuous changes in his life that led to very negative outcomes. What are some small behaviors in your life that may be steering you down a negative path? What would the negative outcomes be?

The Compound Effect Summary Chapter 2: You Make Your Choices, and Your Choices Make You

Every decision you make impacts the Compound Effect. Your life is the sum total of your choices. Choices, no matter how tiny, alter the course of your life because they lead to behaviors; behaviors lead to habits. Your choices are your best friend or your worst enemy.

Most people don’t make bad decisions on purpose. No one strives to be overweight, divorced or bankrupt. The problem is that many of our choices are ingrained in our routines and habits; we aren’t consciously making them. When multiple small, poor choices proliferate, we end up in a bad place. We sabotage ourselves without even knowing it.

The goal is to become aware of the choices you’re making rather than existing on autopilot. With awareness, you can make a series of small good choices that lead to the behaviors and habits that support a happy, successful life.

Small Choices, Big Repercussions

Sometimes you can make a single big, catastrophic choice that damages your career or relationships. Think of celebrity mishaps, like the comedian who was caught on tape hurling racial slurs, or the anti-gay politician caught soliciting gay sex. These mistakes are doozies and they have swift, severe...

Shortform Exercise: Making Better Choices

Your life is the result of your moment-to-moment choices.

This chapter talked about weight loss, fitness, and improved finances as common areas of life where people want to make improvements. What is one area of your life where you’d like to make a change?

The Compound Effect Summary Chapter 3: Habits and Goals

Habits are acquired behaviors that have become nearly involuntary; they put us on “autopilot” in many aspects of our day-to-day lives. Think about how little thought you put into brushing your teeth, strapping on a seatbelt, or driving to work. Because habits require little conscious energy, they can free us to focus our mental energy on more creative endeavors.

Habits can be good or bad. At their worst, habits can run you in the wrong direction without you even realizing what’s happening. It’s like the story of a man on a horse rapidly galloping by. Someone asks him where he’s going, and he says he doesn’t know—ask the horse. Your habits are like the horse, steering the direction of your life.

Good habits, however, take you in a positive direction—and you control the ride. If you are a healthy eater, you probably have very healthy food-choice habits. If you’re fit, you likely have good exercise habits. In fact, successful people all seem to share the common trait of good habits in many aspects of their lives. Successful people aren’t any smarter or better than anyone else, but their habits drive them toward more knowledge, competence and skills.

Be Like Larry

...

Shortform Exercise: Putting Habits to Work for You

Changing your habits will change your life.

Think about your most important current goal. What is the most significant bad habit that is holding you back from achieving this goal?

The Compound Effect Summary Chapter 4: Finding Momentum

Momentum (Hardy calls it “Big Mo”) is a powerful force for success. Momentum doesn’t come easily, but once it kicks in, your ability to achieve success compounds quickly.

The hardest part of achieving momentum is getting started. Think about when you were a child playing on the playground merry-go-round. When it was full of kids and you tried to push it, it took a lot of effort and went very slowly. But as the speed picked up the merry-go-round would spin rapidly and you could hop back on and enjoy the ride. It’s the same with making any changes in your life; progress can be slow at first, but when momentum kicks in it’s easy to keep moving. You can put out less effort and receive greater results.

Putting Momentum to Work for You

Momentum can work for good or bad. The Compound Effect is always at work, so a string of bad habits can build up momentum and send you into a chasm of bad luck with compounding negative side effects. Think of Brad from Chapter 1; because of a few bad habits that gained negative momentum, he gained 33 pounds and ended up with a troubled career and marriage. This is an example of the Compound Effect working against you.

You gain positive...

Shortform Exercise: Build Momentum with Small Changes

When we gain momentum, there’s no stopping us.

This chapter discussed how inconsistency is the momentum-killer. What is a change you wanted to make in the past, but applied it inconsistently and eventually lost all momentum?

The Compound Effect Summary Chapter 5: Understand What’s Influencing You

We are all responsible for the choices we make, but it’s important to realize that those choices are influenced by powerful outside factors. We’re often unaware of the subtle influence of these external forces, but understanding and governing them can help us maintain our trajectory toward success.

There are three main types of influences:

• What’s going in (input)
• Who we associate with
• Our surroundings

Controlling Your Mind’s Input

Controlling what our brains consume directly impacts our productivity and results. For example, reading a tabloid won’t help your brain function at its peak, but reading something educational and inspirational will nourish your brain.

What our brains consume is difficult to police, however, because we absorb so much unconsciously. Even if eating junk food is easy and mindless, at least you have to put it in your mouth yourself. In contrast, we can hear, feel and absorb irrelevant and destructive input without even knowing it—for example, switching on the radio on our way to work can flood our brains with terrible news, leaving us with fear and negativity to start our day.

**You are the gatekeeper of your mind, and you must be...

Shortform Exercise: Controlling Your Influences

The choices we make are subtly influenced by outside factors.

This chapter discusses the negative influence of the media and how it can hamper creativity. What are three types of media you absorb daily that might be affecting you negatively?

The Compound Effect Summary Chapter 6: Breaking Through to Greater Success

The Compound Effect can spur you to greater heights of success faster than you ever thought possible, but on your journey you will face moments of truth—times when you’re up against the wall. What you do next defines both who you are and who you will be. In such a moment of truth, growth and true improvement can occur.

Hitting the Wall

Hitting a wall is inevitable. Whether you’re riding a bike up a steep hill or facing a long day of work, there will be times when quitting is a very attractive option. These moments of truth, however, are defining moments—the turning points for your success and progress.

For example, famed football coach Lou Holtz inspired his team to come back from a halftime deficit of 42-0 by showing them a highlight reel of second efforts—the extra effort after you’ve already done your best. That extra effort is the difference-maker in a football game and in life.

Hitting the wall is an opportunity for greatness, not an obstacle. When things are easy and going well, everyone can do great. But when an obstacle appears, it’s a chance for you to rise above the pack and give the extra effort others are unable to give. Your response to obstacles...

Shortform Exercise: Extra Is Worth It

More effort pays dividends.

This chapter talked about the multiplying effect of just doing a little extra. What are three areas in your life where you could give just a little bit more?