Jay Abraham Super Summit Workbook

Jay Abraham’s
U SUPER SEMINAR
Workbook
Growing Your Business Exponentially –

Without major risk
(while creating wealth and maximum value – for your
marketplace and yourself)
Los Angeles 2013
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Jay Abraham’s
U SUPER SEMINAR
U Workbook
Growing Your Business Exponentially –

Without major risk
(while creating wealth and maximum value – for your marketplace and yourself)
Name: ________________________________
Date: ________________
Beta version: This Workbook is a work-in-progress designed for internal use only. We tried to
acknowledge all sources and if any are omitted, it is not our intent and due to a minor oversight. If you
believe any of the material has not been cited correctly, please contact The Abraham Group so we may
resolve these issues immediately. This Workbook is not intended for duplication or sale.
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0BU TABLE OF CONTENTS
U DISTILLATIONS U U Page
1. Excerpts on Liquid Assets by Jay Abraham and Tom O’Neill 7

2. Notes from Private Equity Playbook 20
3. Chapter 1: The CEO Who Sees Around Corners
by Carlos Dias & Jay Abraham 23
4. Creative Leadership for Turbulent Times:
Transcript of Jay Abraham and Carlos Dias’ Webinar 59
5. Jay Abraham’s Philosophical Emails 128
6. Robert Hargrove and Jay Abraham’s Multiplier/Diminisher 150
7. So You Want to Create a High Growth Gazelle? By Robert Hargrove 158
8. Encounter! With Jay Abraham and Tom Phillips 167
9. Stephen M. R. Covey Teleconference Leading At The Speed Of Trust
Featuring Jay Abraham 200
10. Dr. Stephen Covey Interview Featuring Jay Abraham 227
11. Jay Abraham and Rich Schefren’s transcript on Value 257
U EXCERSISES AND ACTITIVIES

1. Writing Space: Social & Digital Media Notes 278
2. Exercise: How to Best Benefit, Profit and Prosper From This Experience 283
3. Exercise: The Ten Pathways to Passive Income 290
4. Exercise: Mature Business Re-Invigoration 293
5. Exercise: 12 Pillars of Strategic Business Growth 299
6. Exercise: Strategy VS. Tactics 302
7. Exercise: Six Ways You Can Out Think, Out Perform
And Out Earn Your Competition 310
8. Exercise: Lessons You Can Learn From Steve Jobs 312
9. Exercise: Three Ways to Grow a Business 319
10. Exercise: Strategy of Preeminence (including Advanced) 323
11. Exercise: Jay Abraham 101 344
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12. Exercise: Jay Abraham’s “4 Steps to Greatness” and Adding Value 364
13. 21 Power Principles 379
14. Our Focus 408
15. 14 Mindset Pillars 410
16. The Seven Sciences of Masterful Marketing 413
17. The items we will be leveraging and maximizing for you 415
18. Exercise Questions on Assets and Available Resources 420
19. Nine Business Drivers 424
20. The Nine Skills of Marketing Greatness 433
21. Business Rules to Grow By 435
22. How to Stimulate Innovation 442
23. Training the Mind 443
24. Twenty Five Entrepreneur Musts 445
25. Going from Good to Great to Beyond 449
26. Force Multiplier Effect 454
27. POWER PARTHENON Strategy of Geometric Business Growth 455
28. Up-Selling, Cross-Selling, Follow-up Selling to Multiply 461
29. Nine Major Benefits of Strategic Alliance 462
30. 43 Additional Factors – Strategic Alliance 465
U YOUR CUSTOM ACTION GAME PLAN U 478
31. Expanding Your Growth Possibilities 479

32. My Master Marketing Strategy 482
33. My Company’s Actions, Activities, Opportunities 484
34. SUPER Questions 496
35. Bring it All together 526
36. My Reverse-Engineered Timeline 529
37. Notes 533
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1BU NOTES:
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2BU NOTES:
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U EXCERPTS on Liquid Assets – by Jay Abraham and Tom O’Neill
The basic rubric here is that liquid asset management is very, very mature. Every city has
dozens of asset management firms of varying levels of expertise. Some focus on
professionals with anything from a couple of nickels to rub together to a million dollars.
Some people focus on high net worth clientele; say $1-10 million. And then, there's ultra-
high network clientele, typically anywhere from $50 million plus in investable assets. And
there are already companies that focus on each of those echelons. But what's not really
focused on is taking a strategic investment mentality and applying it to a business.
It's insane how much money is left on the table when the average person sells their business,
and these are professional investors. Oppenheimer (the consulting company) did a study on
private equity, and they said the average private equity firm does 1.2 deals per year, per
partner. So, the average private equity professional is buying one or two companies a year. And
the average entrepreneur is selling one or two companies IN THEIR LIFETIME. In their entire
lives, they're going to sell one or two companies.
Why own private companies?
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Basically the first problem with private business versus public investment is most people don't
even know what sort of rate of return they're getting. Do you?
They don't have their business appraised on an annualized basis. They know their dividend and they
know the cash flow, but that's only one component of the term, is cash appreciation in the business.
From a wealth management standpoint with these pre-liquid assets, there's a presumption that the
management team is the group of people to whom they've delegated this responsibility.
Is that really true? I think there's a difference between a manager and a wealth manager and very
often management has adverse interests with ownership. They're not going to recommend a change
to the business that they feel threatens their fiefdom. I think business owners need to take
responsibility either on their own, or with the help of breakthrough thinking advisors, to take a more
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active role in the management of this pre-liquid asset called “the business”—the business or
businesses that they own.
Non-economic
Flexible lifestyle
Strategic control
Product passion
Employee loyalty
Family continuity
Well, why do we own private companies? Well, there are lots of reasons. There's non-
economic and economic. Non-economic. These are reasons I love owning businesses. I like the
flexible lifestyle. I love the control and feeling in control. I might be passionate about the
business or the product or the service, which I usually am.
Why do you own your business?
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From an economic standpoint, there's really only one reason to own a business. Setting the
entire non-economic reasons aside, it's got to beat your next best alternative for that
deployment of that capital. And if I've got $2 million or $20 million tied up in a business, then
there's only reason for me to keep doing it from an investment standpoint, and that's because
it's better than my next, best alternatives.
Knowledge asymmetry: It's sort of the fisherman versus the fish. Who's better at that? And who
is better at fishing? The idea, here, is to take that knowledge asymmetry and level the playing
field. Take the tools that are employed day in and day out, that are common as dirt to the
private equity company – then acquire and use them yourself. Relational Capital helps make
that possible.
This is actually a great Jay Abraham principle which is to take something that's common in one market,
and apply it to another market where it's uncommon. This is something every private equity firm in the
world.
If your business was a mutual fund…would you buy it?
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§ Measuring investment performance
§ RoEV = Equity Appreciation + Dividend / Enterprise Value
§ In private equity, most of these disciplines are pretty religiously applied, although
interestingly, not in all private equity companies. But an entrepreneur typically doesn't
think of their business as “an investment”.
§ Out of your control
§ Industry factors
§ Stock market
§ Capital markets
§ Local economy
§ Regulatory changes
§ Interest rates
§ Within your control
§ Growth rate
§ Balance sheet
§ Quality of earnings
§ Predictability of earnings
Increasing earnings. All things being equal, the more earnings you have, the less risky your
business is perceived to be. So, if you buy a business that does $0.5 million a year in cash flow—
all things being equal, it's going to be worth a smaller multiple than a business that does $500
million a year in cash flow. The larger company is perceived (and probably) is more stable and
has more momentum.
Increase your sales and growth rate. So everything Jay Abraham teaches people to do is not
only cash flow enhancing, but multiple asset value enhancing. If you can generate that uptick in
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your business, you increase the enterprise value selling price not only linearly, but
exponentially to some extent.
The predictability of earnings. Showing that if you have one way—you've probably looked at
businesses where they've got two promotions that they run, and that's the whole business.
That's going to sell for a smaller multiple than a business that has eight ways of getting income,
because saturation happens.
And then concentration risks. You could have a business that throws out $5 million a year in
cash flow, but if it comes from one customer, it's a perilous position to be in. To the extent that
you can diversify the risk, these are all the things that affect the multiple.
It doesn't make any sense to be in business if it's not beating your next, best, risk-adjusted
alternative. And obviously an index fund, by and large over the long run, is less risk. They don't
require personal guarantees, as far as I know, to buy into the Dow Jones Industrial Average. So,
if I'm going to be taking more risk, and I'm going to be investing more of my life force into
something (like a business), I've got to be beating the market – meaning the money I could
make passively.
You've either got to hunker down and make this asset I called ‘your business’produce what it
should, or liquidate it and give the capital to somebody who can get you the rate of return
that you're not getting. Outsource it, essentially, to an investment fund.
Demonstrating that you understand your micro-investment portfolio. There's the investment
in the business and then there are the investments within the business. Again, you look at
things like cost of acquisition versus lifetime value. There is an implied yield there. That's an
investment. It's not an expense.
U Reducing people risks. If you've got only one key employee who is the chief cook and bottle
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washer and he's seventy years old, your business will be discounted. If you're important to your
business, then it's a gigantic discount. One of my goals is to be almost irrelevant. My goal is
actually to walk into a business that I own and have nobody recognize me.
Bottom Line on Valuations
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Private equity is risky and volatile
Valuation is a process, not an event
Quantifies risks for wealth advisors
“rules of thumb” are inaccurate
The whole private equity game is to buy low and sell high. You never buy high and sell high.
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You want to buy low and sell high. There's nothing I love more (if I'm wearing my professional
investor hat) than to find companies that are in a horrible state of disrepair and where there's
low-hanging fruit in every drawer I open. Every drawer I open has a brand in it… Wholesale vs.
premium return on your life investment.
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What separates Professionals from Proprietors
And on the earnings side, pretty simple. Increase revenues and decrease expenses. And
obviously there's a relationship between the two. That's what most people miss. Revenues and
expenses is kind of a two-dimensional view. I call it two-dimensional accounting.
Enhancing Your Return

Two Principles for enhancing returns:
Make new investments
Tom Philips’ Three Ways to Grow A Business
Maximize return on existing investments
Latent Enterprise Value
Found in 3 forms:
Capital reallocation gains
Process improvements
Multiple expansion
Latent Enterprise Value Calculator—latent in this case meaning it can be harvested with little
or no operating expense. So this is latent in the sense it's right there. You just have to bend
down and pick it up. There's nothing to do other than recognize the opportunity, and then
rebalance your capital, or just make very slight changes to your operating processes. This is not
hiring new salespeople or anything of the kind. You're not deploying new operating capital.
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What have you learned that you didn’t already know about Liquid Assets? And how will you
apply this new knowledge?
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How can you apply Liquid Assets to Relational Capital? How will this benefit your business?
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U Outline
I. Every Business Will Change Hands - Begin with the End in Mind
A. Every business will be sold – the average business changes hands every 7 years.
B. The sale can be to financial or strategic buyers, partners, or in a downside Scenario -
even creditors. But don’t let this event take you by surprise. There are things that you
can do now (particularly with relational capital) to ensure that this event is a happy one,
and one that provides for your family for generations to come.
C. Every entrepreneur thinks their business is unique, and of course, it is – just as every
human body is unique.
D. The ultimate goal is to build the business that every buyer wants to buy - low risk,
predictable cash-flow generation (from multiple sources) that they can own and operate
on a laissez-faire basis. Your job is to build an automatic “cash machine.” Isn’t this also
the business you want to own...whether or not you’re interested in selling now?
E. Quick Primer on Enterprise Value (i.e., it’s a multiple of free cash flow adjusted for risk
and growth factors).
II. Anatomy of a Healthy Business

A. Critical
1.Product Development
a) Creating or Originating products and services for which the expected
revenue significantly exceeds the cost of fulfillment. Relational Capital
lets you do this continuously. This should be a continuous process as it
directly feeds into Customer LTV (Lifetime Value) Maximization.
b) If this process is “sick” no amount of sales, marketing, or process
optimization will cure it.
2. Customer Acquisition
a) Lead Generation
b) Conversion
Let’s discuss.
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B. Important
1. Customer LTV Maximization
a)Transaction Maximization
(1) Up-selling
(2) Cross-selling
b) Customer Retention
c) Customer Reactivation
2.Transaction Cost Optimization (for supporting the above processes)
a) Elimination (Don’t do it) - getting rid of non-productive products,
processes, functions, etc. Do you know how everything/everyone really
performs/stacks up?
b) Automation (Have a machine do it) - using tools or software to
automate as many functions as possible, thereby reducing the cost per
transaction.
c) Outsource (If people must do it) - chances are good that someone has
already created an efficient cost-effective system for performing your
desired function. Find it, and use it. (Relational Capital Partnering).
d) Systematization (If you must have people do it, and can’t effectively
outsource it) - create and document a system for it. (See ‘Nine Drivers’).
(1) Create IP here when you can to preclude competitive
duplication. Preemptive/Preeminence.
(2) Offer this as a service to monetize your “overhead” where
applicable and desirable. (Licensing/Joint Venturing/Etc.).
C. Strategic
1. KPI/Yield Analysis
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a) This function is critical to ensure mid and long-term health, and
ultimately exit value of your business.
b) Indication of the health of your business and effectiveness of your
strategies.
c) These may vary somewhat from business to business, depending on
the depth to which they are measured, but at a surface level, these are
applicable to all businesses (all KPIs are per period measured, could be as
often as weekly or as seldom as quarterly, depending on the business):
(1) New Customers Acquired
(2) Customer LTV
(a) Average Order Size
(b) Average Order Frequency
(c) Average Length of Relationship
2. Enterprise Value Engineering
U REVIEW:
How do you continuously create or originate products and services for which the expected
revenue significantly exceeds the cost of fulfillment?
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III. Enterprise Value Diagnostics™
A. What are your basic KPIs for the past 4 quarters (as a start, this should be done as a
corporate average, but can also be calculated per business process for advanced
companies)?
1. Active Customers (customers adhering to your subjective “baseline”
purchasing behavior – i.e., ordering within an “acceptable” interval)
2. New Customers
3. Customer LTV
a) Average Order Size
(1) Could also evaluate SKUs per order, if applicable to assess
cross selling function
b) Average Order Frequency
c) Average Length of Relationship
4. Customer Attrition (customers deviating from the aforementioned baseline
purchasing behavior)
B. Does your business have all of the structural elements in Section II (particularly A&B)
in place?
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C. For each of the structural elements, enumerate the different approaches your
business has to each (ideally, there should be more than one).
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D. What is the ROI on each core process, expressed in percentage yield? Do you know?
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E. For structural elements with more than one approach, what are the relative yields of
each process?
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F. Are there any gaping holes in the EVE mind map that may affect your company’s
multiple?
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IV. Enterprise Value Engineering™ Strategies

A. Fix structural problems first
1. Least staff resistance – social/emotional/intelligence/leadership.
2. Maximum impact on cash flow and multiple (significantly reduces risk).
3. Little to no OpEx required.
B. Harvest Capital Reallocation Gains
1. These are asymmetries you noticed as a result of the work in Section III (E).
For example, if you have 3 processes for generating leads, operational capital
should favor the processes with the highest yield, as measured by the effective
cost-per-lead, compared with the customer LTV resulting from that method.
2. Low staff resistance (other than possible reduction of budget)
3. No new OpEx required.
C. Process Improvement
1. Deconstruct, test, and optimize the various elements of key business
processes.
2. More staff resistance (teaching “old dogs new tricks”)
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3. Little to no OpEx required.
D. Add new processes
1. For each core structure element, add new processes
a) New lead generation methods
b) New closing methods
c) New fulfillment and/or service delivery methods
d) New customer retention methods
e) New up-selling/cross-selling methods
2. Use existing KPIs and yield numbers as benchmarks for the performance of
these new processes.
3. This reduces risk, increases cash flow, and significantly impacts valuation
multiple.
4. Staff resistance can be significant here.
5. Some new OpEx usually required.
6. Key message of the work : Most companies start here, having foregone the
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above which are more immediately impactful and require little to no risk. They
go out trying to borrow capital to do something that could have been financed
internally by executing the above strategies. (Relational Capital).
E. Multiple Enhancement Strategies
1. Deep dive on lower portion of the EVE MindMap
F. “Moat” Strategy - Protect your Enterprise Value from competitive threats
1. The more valuable your business, the more attractive it is for competitors.
2. Analyze all corporate assets for valuable:
a) Terms (Trademarks)
b) Copy (Copyrights)
c) Unique methods, software, processes, tools (Patents)
d) Identify Trade Secrets for which you do not desire to seek Patent
Protection.(License/Joint Venture).
3. Ensure that your Trade Secrets are protected via solid contracts with
employees, vendors, and yes – customers.
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4. Enforcement - have a regular process for seeking out and enforcing your right
regarding the above.
V. Enterprise Value Strategic Guidance
A. Blind spots are inevitable “can’t analyze your own back-swing”
1. Build a board of advisors from outside your normal circle to keep your thinking
fresh. Use Relational Capital.
2. Sell the “Intellectual Capital” concept here.
B. Subtle call to action is to have them contact us particularly when they are thinking
about selling.
U REVIEW:
Most companies go out trying to borrow capital to do something that could have been
financed internally by executing the above strategies. How can you apply Relational Capital to
execute the lessons above about Liquid Assets?
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U YOUR NOTES on Liquid Assets and what you’ve just read:

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U NOTES FROM PRIVATE EQUITY PLAYBOOK
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Webinar 1:
Selecting and Facilitating the MGA
1.1 Webinar Intro

(Music)
1.2 Welcome!
Welcome. I’m Carlos Dias.
Today’s webinar is about what I call “The Secret Factor.” It will lay out a roadmap for finding
your greatest unleveraged asset - the ability to think divergently - by working within the
framework of a Mastermind Group Alliance.
In my experience, our society’s current emphasis on incentivizing individual talent comes at a

cost. It diminishes the overall effectiveness of our organizations. Why? Because, to succeed in
a fast, dynamic world, you need to innovate. But innovation doesn’t happen as a result of a
lone individual looking at the same old problems in the same one-dimensional way. To create
solutions that are truly innovative, you must find a way see multiple points of view, and
harness different ways of thinking.
What examples come to your mind when you hear the word “innovation”? Forty years ago, it
took a team of gifted people to put a man on the moon. In just the past 10 years, it took a
talented team of executives at Apple - not just Steve Jobs alone- to turn the consumer
electronics industry upside-down several times over. We see the pattern repeating time after
time. One person alone cannot match what a team of diverse, talented people can
accomplish - but only if the organizational structure and process exists to harness their
collective insights.
That is why the Mastermind Group Alliance concept so compelling, interesting and exciting. A
Mastermind Group Alliance is a group of talented individuals, each with a different
background and different ways of thinking, but all focused on the common goal of unlocking
your organization’s potential. Guided by the systematic, carefully-structured activities and
approaches packaged in our program, the Mastermind Group breaks through old, self-limiting
assumptions and outdated uncompetitive benchmarks. Instead, it leverages the power of
divergent thinking, allowing you to see multiple, innovative scenarios for transforming your
organization’s future.
That is why Jay Abraham and I decided to create this program. We believe that a Mastermind
Group Alliance will forever change how you think, how you see, and how you approach your
role as leader of your organization.
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© 2013 Executive Learning Systems
1.3 Understand Reality
When you boil it down, the essence of your leadership job is to understand reality. That is
the true situation and the problems that actually exist in your organization, in contrast to
how you would like your organization to be. Therefore, you need to see the truth about how
your business is positioned. You need to recognize the new fundamentals, the trends and
patterns that function as the underlying structure of this new competitive world - and
recognize whether they are telling you “all clear ahead” or “look out below.”
Because if you can recognize the trends and patterns, as well as the underlying structure, it’s
not that difficult to navigate in turbulent times. If you know there is a threat, you can steer
around it. If you are aware of an opportunity, you can create a strategy that exploits it so
your business can profitably grow.
It sounds simple, but it’s not. Because in hyper-turbulent times, “reality” changes quickly.
Patterns that appeared benign yesterday may actually be flashing red today. Therefore, if you
are still steering your business based on yesterday’s assumptions, you may soon be heading
for disaster.
1.4 What's Your Expiration Date?
In turbulent times like today, reality comes with an expiration date.

New knowledge is being created at an unprecedented pace. No matter what industry you are
in, and no matter how long you have been in it, you can be sure of this fact alone: that much
of what you know today will be obsolete tomorrow.
1.5 Mastermind Group Alliance
If you know the terrain is changing under your feet, your first priority as a leader must be to
understand the new terrain - and then to create a strategy for navigating through it.
In Creative Leadership for Turbulent Times, Jay Abraham and I have assembled all of the
learning and analysis tools you will need to master your new reality and find innovative
strategies that result in a more profitable business. As you work through our program, you will
see that it guides you step by step, starting with theory and concepts and then showing you
how to apply it to your business - so you’ll never get lost or lose momentum.
But there is one more missing ingredient for success - a secret mechanism that will
springboard you to knowing, with an absolute faith and certainty, that you are leading your
organization on a path to sustainable, breakthrough performance.
The name of that secret mechanism is the Mastermind Group Alliance - and it is the key to
unlocking the true value of our program. A Mastermind Group Alliance is a way to amplify
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your personal brainpower. It allows you to leverage the best minds in your organization in a
way that will supercharge your ability to think strategically about your business.
So here is Scott Schmeer, to explain to you why, and how, a Mastermind Group Alliance makes
our program so unique, so singular or unusual and so powerful - because it will be able
positively influence people and events in your organization.
1.6 You've Seen This Movie
We’ve all been to seminars where management gurus got us excited and inspired. But when
we brought those programs back home, what happened?
Maybe there was a short flurry of interest. But no one knew the right way to implement the
program. No one knew how to align it with your organization’s processes or make it work with
your people. So after a few half-hearted attempts…. the initiative lost steam - leaving you
with nothing but another expensive paperweight.
1.7 Catalyst for Culture Change
As a multinational CEO himself, Carlos understood that these failed initiatives could take a
toll on your organization. After a few of them, your people just learn to shrug them off as
“flavor of the month” - and harden their resistance to change.
So Carlos and Jay both knew that, to unlock the power of the Strategic Wealth Creator
System™, you would need a way to make this time different -- a magic bullet that would drive
true culture change through your organization.
That’s what the Mastermind Group Alliance can do for you, as it has done for organizations
the world over. Think of it as your magic bullet. A proven system: twenty-one people,
including the Senior Executives, working in 7-person groups. Carefully selected. Working not
in competition, but in harmony. Focusing their collective insight through the prism of the
Strategic Wealth Creator System’s step-by-step guides. Not making decisions for you, but
providing you with the depth and breadth of perspective that you or your Board will need to
set a course for sustainable growth - and then serving as the culture warriors who can ensure
your strategy takes hold across your organization.
1.8 Make a Choice
This workshop will help you with the nuts and bolts of how to make your Mastermind Group
Alliance successful.
If you are ready to learn how to run a Mastermind Group Alliance program, please click the
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Ready button on your screen.
But if you don’t believe that a Mastermind Group is for you - Jay Abraham would like a chance
to speak to you further before you make a final decision. So please click on the Convince Me
button, and bear with us for a few more moments.
1.9 Why You Need to Reconsider
Hi, this is Jay Abraham.
If you are at this point in the program, you have doubts about whether a Mastermind
Approach is for you. But take a few moments to reconsider. It will be well worth this short
investment of your time.
I have worked with CEOs and senior executives around the world, so I know that your time is
tight. You have so many calls on your attention, and every one of them is urgently important.
But if you think about it, there is only one central, essential task that you can’t outsource. I
call it “understanding reality.” “Understanding reality.” It’s knowing where your business is
positioned, where it needs to go, and how to get there. Under normal circumstances, that
would be hard enough. But congratulations, you live in special times - so you need to be
constantly ready to adjust your understanding of reality in the light of increasingly turbulent
change.
1.10 Coming to Grips with Reality
How are you planning to come to grips with an ever-changing reality?

Are you going to tell me, “Jay, don’t worry, I’ve been leading my company for years and I
know what I’m doing”? Because I’m here to tell you, you are kidding yourself. Change is
making your experience and understanding obsolete. New technologies, new competitors,
new customers who need to be marketed to in a new and different way - it’s all happening
too fast for one person to stay on top of it all.
And you know it or you wouldn’t be looking at this program. You are feeling the stress, you
are feeling the insecurity of not knowing which way to lead - I know, I’ve been there, it’s not
easy.
1.11 The Leadership Mindset
I want to show you a chart from our book. And I don’t mean to insult you, but I feel I must
speak frankly to get your attention.
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It’s been my experience that leaders fall into 3 categories: Talkers, Doers and Thinkers.
Talkers talk about growth, but they limit themselves. They insist on looking at things the
same old way. New information, new patterns that don’t fit their personal perceptions of
reality, never get through.
Talker-leaders, at the bottom, are letting their emotions get the better of them. They’re
being defeated by ego.
On the one hand, they tell themselves that no one else could possibly know as much as they
do -- about their customers, or their marketplace, their products, or their financial
performance. But on the other hand, they worry about looking weak - so they resist solutions
and situations where their opinions or perceptions might be challenged. Can you see why I
believe that the Talker mindset is essentially arrogant?
1.12 Misguided Thinking
So what happens if a Talker-leader completes our program but skips the Mastermind Group
Alliance? Will they succeed in growing their business?
Yes, absolutely they will realize growth, because the program will help them to think through
their business issues strategically and systematically - perhaps for the first time ever, and
certainly for the first time in a long time.
But they are limiting their growth potential, because they are clinging to their low-growth
mindset.
1.13 What Kind of Leader Do You Want to Be?
Doer-leaders, and more importantly Thinker-leaders, take a different approach. They don’t
let personal emotions like arrogance or fear get in their way. They realize that their own
thinking is filtered by their personal experiences, hopes and biases. So they take the risk of
opening their minds. They seek outside input from others - carefully chosen others whose
minds they respect - like a Mastermind Group Alliance.
Look what you can expect as a Thinker-leader, working through our program in conjunction
with a Mastermind Group. Because you are no longer limiting yourself, you will find yourself
discarding outdated assumptions, and making room for creativity and innovation - which in
turn will allow you realize new high levels of business growth and achievement. But equally
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important, on a personal level, you’ll once again be able to sleep at night. Because after
exploring every idea, looking under every rock, questioning every assumption - you’ll know in
your heart that you are making the right strategic decisions that will take your business where
you want it to go.
1.14 After the Strategy ... What's Next?
And after you’ve set your strategy using the Strategic Wealth Creator System™, your
Mastermind Group Alliance will not only have learned how to think accurately, but they will
also be aligned to your new strategy and ready to make sure it gets executed properly.
Consider the advantage this gives your business.
Let’s say that both you and your typical competitor each have 21 executives. Each executive
works 250 days a year, chugging out an average of 2 strategic decisions each day. In each
organization, that is 10,500 decisions a year.
In your competitor’s business, those decisions are being made by inaccurate doers - which
means, without a doubt, they are destroying that business’ wealth.
But in your business, those same decisions are made by executives who have been developed
into accurate thinkers through the Mastermind Group Alliance. They understand - and in fact
participated in creating - your company strategy so they are committed to making it work.
Can you see your advantage? Can you imagine the potential for wealth creation that you just
have unleashed?
1.15 See Beyond the Tip of the Iceberg
We started this webinar talking about how the essence of your role is to see reality. With a
Mastermind Group behind you, you’ll widen and deepen your vision - you’ll finally be able to
see beyond the tip of the iceberg -- and find opportunities for growth that were previously
unimaginable.
So become the Thinker-leader that I know is inside you. Continue this webinar and learn how
to get the most out of a Mastermind Group Alliance. You’ll be very glad you did that.
1.16 Menu
Here are the topics we’ll cover in this online workshop.

Please click on any topic to begin your workshop.
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1.17 What Is a Mastermind Group Alliance (MGA)?
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1.18 What Is a Mastermind Group Alliance?
A Mastermind Group Alliance is a group of individuals who work together, in harmony, to

amplify a leader’s knowledge.
Alliance members share an important bond - their commitment to growing your business to its
fullest potential.
Together, this carefully selected, carefully focused group acts as a collective source for the
hindsight, insight and foresight you will need to create high-growth strategies for your
business.
1.19 Much More than a "Team"
A common misconception about the Mastermind Group Alliance is that it is a team.

Actually, the two concepts are quite different.
We’ve all been on teams that were formed to accomplish some particular task. The
motivation for being on the team is external - perhaps we were volunteered, or paid, or
assigned to the team. We have no particular bond with our teammates, except the wish to
get the task accomplished as quickly as possible. Maybe that’s why team members often
agree to groupthink decisions, just to move things along and avoid conflict. Although it wasn’t
planned that way, often there are winners and losers on a team - the winners are the ones
who brag that their idea carried the day, while the losers whisper to their friends that they
disagree with the team’s decisions.
By contrast, the Mastermind Group Alliance starts out with a strong advantage - a shared
commitment to achieve a common goal. They park their personal agendas at the door - and
quickly bond into a tight-knit community of thought leaders who don’t compete with one
another, but rather try to elevate one another. Without the political distractions,
Mastermind Group members can forget about trying to win the argument and instead
concentrate on forging a winning strategy. The resulting synergy yields results that far
exceed what is accomplished in a team.
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1.20 The Power of Momentum
On its own, a Mastermind Group Alliance will create organizational momentum.

But when you link the Mastermind Group Alliance concept with the highly-focused processes
and tools found in the Strategic Wealth Creator System™, you create synergies that impel your
organization forward, further and faster than previously thought possible.
Think of it this way. With or without the Strategic Wealth Creator System™ and Mastermind
Group Alliance, your 21 executives are making 10,500 decisions a year. By developing them to

become accurate thinking leaders, and aligning them all to pull in a unified strategic direction,
you create unstoppable momentum toward wealth creation for your business.
1.21 How Is the MGA Configured?
Although there is room for some variation, experience teaches us after hundreds of facilitated
sessions that the best shape for a Mastermind Group Alliance is 3 groups of 7 individuals each,
for a total of 21 members.
Each of the 7-member groups contains at least one C-level executive. Other members might
be senior executives, junior executives, or even managers with deep background in important
strategic areas.
Sometimes people mistakenly think that they could get even better results having more than
7 people to a group.
Please don’t do that! Seven is the maximum size for effective communication within each
group. If you’d like to learn more about why this is so, please click “Because of Dunbar’s
Number” on your screen.
1.22 How Is the MGA Configured?
As a practical matter, it’s a good idea for the C-level executives to rotate between the groups,
so they get to know the strengths of each set of participants.
But other than that, what happens inside the 7-member group needs to stay inside that group.
That ensures that members feel free to discuss freely, and question deeply, without worrying
about what an “outsider” might think.
Members don’t discuss their findings with others, including those who are members of the
other 2 Mastermind Groups.
1.23 Why Run Three Groups?
By keeping the 3 groups separate but running each of them through a parallel set of activities,
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you create a set of strategic checks and balances for yourself. This is where you start shaping
the new strategic culture for your organization.
How does it work? Each member of each group prepares for the group meetings by watching
the clear instruction in the eLearning program, and reviewing the details in the
Implementation Guide. Then each of the 3 groups meets and conducts a parallel set of
activities, all applying the same powerful proven concepts and completing the same carefully
structured electronic posters.
When the 3 groups complete each significant milestone event - for example, after completing
each module of eLearning along with all of the practical activities associated with the module
- you will have 3 different sets of strategic decisions to compare and contrast.
At that point, you can convene all 3 groups and ask them to share their findings. Your goal in
this 21-person meeting is not to choose which group did best - this isn’t a competition - but
rather to create a strategy that culls the best thinking across all 21 participants.
1.24 Is the MGA in Charge?
Here is a common hesitation that many CEOs have about the Mastermind Group Alliance. They
are concerned that they are delegating their own right, or their Board’s right, to make final
decisions about business strategy.
1.25 Summary
Here is a quick summary of the key points in this section of the webinar.
Click Next when you are ready to continue.
1.26 Select and Invite MGA Members
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1.27 How to Select and Invite Your Mastermind Group Alliance Members
A Mastermind Group Alliance is an exercise in applied science. Add the correct components,
in the right balance, under the right conditions, and you create a chemistry that is more
powerful than you could have imagined.
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But be careful - because the wrong components, in the wrong mix, or under the wrong
conditions, can fall flat - or blow up in your face.
In this section, you’ll learn how to create Mastermind chemistry - how to choose the best
people, how to group them so you have a productive mix, and how to bring them onboard
with just the right amount of heat and pressure so they are excited and ready to work.
1.28 Selecting Components
Let’s begin by selecting the right chemical components - your Mastermind Group Alliance
participants.
Obviously, since this is going to be your brain trust, you want the strongest minds you can find.
But intelligence is not enough.
You also want the individual to know at least one aspect of your business well.
You want someone who is well-informed on business-related and non-business-related topics.
In other words, someone who demonstrates the intellectual curiosity to seek out new
thoughts and innovative ideas.
And you want the person to be open-minded - someone who is willing to look at things in a
different way.
You definitely don’t want a yes-man or yes-woman in your Mastermind group. Being willing to
push back and challenge assumptions has to be part of the job description.
Loyalty is absolutely non-negotiable. Remember, you will be working with this individual to
redefine the future of your business. You want someone who can share your commitment to
that goal.
And finally, you need someone who is willing to spend the time and do the hard work that will
be required of a Mastermind Group participant.
1.29 Common Questions
In a Mastermind Group Alliance, you have 21 slots to fill.
Three of them should be easy. They are the CEO and other two C-level executives.
Some of the remaining 18 will be obvious. But some will be judgment calls. Here are some
common issues.
--Should I include executives only?

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You’ll notice that rank didn’t appear on the list of criteria for selecting participants. You
want people who know different aspects of your business - but that doesn’t necessarily mean
that they all need to be executive-level. So go ahead and include your Sales and Marketing
Director - but for deep understanding of how your customers perceive you and your
competitors, you’ll probably get deeper insights from a senior sales person.
If you do tap someone at a lower level, remember the “push-back” criterion. You’ll want to
make sure the non-executive has the intestinal fortitude to engage in debate with higherranking
participants.
--My junior executive is loyal today. But what if she takes a different job in the future?
No matter how strong the individual is, if you know he or she is looking around for other
opportunities, you can’t afford to have this person on your team.
But you can’t be paranoid about this. There is always some risk that your executives might
leave you. In fact, if you refuse to develop their knowledge, you are probably improving the
odds that they will leave in the future. By contrast, including them in your Mastermind Group
Alliance is a way to strengthen their sense of commitment, and create a deep bench of next generation
leaders.
--My VP of Production is tied up for the next 2 months. Should I include him anyway?
All of your participants must be willing and available to serve NOW. So for the moment,
choose someone else.
But in the future, you’ll have a chance to rotate people into or out of your Mastermind Group
Alliance. So keep the VP of Production in mind as a future candidate.
1.30 Create a Balanced Mix
You’ve chosen the individual components of your Mastermind Group Alliance. Now it’s time to
consider how to mix them together.
You’ll be dividing your 21 participants into 3 groups. Each of the groups will be working in
parallel, on the same activities. At the end, if the chemistry is right, they’ll present you with
3 different sets of innovative strategies.
One way to do this is to create 3 diverse groups - each with a mix of experience and expertise.
An interesting alternative is to group all of the junior executives in one group, and put the
more experienced people into the other 2 groups. This frees the junior executives to take a
fresher approach, without some of the self-limitations that a more experienced crowd might
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impose on them. When you compare and contrast the results from the groups, you’re likely to
find some striking generational differences.
Not only that, you will be surprised to see what happens when junior executives work
together, free from old paradigms. They are usually the most eager to try new concepts.
Their conclusions will favorably surprise you, as Carlos and Jay have witnessed in their past
experience.
1.31 Personality Styles
It’s also important to balance personality styles. This is where your alchemist’s touch is
needed. You want each group to generate significant heat, but not so much as to trigger an
explosion.
For example, a group that contains only Amiables will bond strongly and have a great time
together - but they’ll never get anything done.
A group that contains only Analyticals will be all-business, but they’ll tend to reject ideas
that haven’t been rigorously tested. They’ll be too focused on perfection to actually come to
a decision.
A group that contains only Expressives will need a sound-proof meeting room. They’ll be
enthusiastic and excited - but they’ll be unwilling to stay with the process, and give you the
structured feedback that you’ll need.
And a group that contains only Drivers will just talk over one another, with each person
insisting on getting things his or her own way. They will never be able to agree on an answer.
You can visit the link on the bottom left of your screen for a complimentary test to identify
your own personality type.
Click Next for a quick exercise to help you identify personality styles.
1.32 Balancing the Styles
With a little practice, you’ll be able to recognize a person’s dominant personality style fairly
easily.
Here’s an exercise to get you started. We'll start with John.
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Read John's personality traits. Determine which is his dominant style, then drag him into the
appropriate quadrant and click Submit to check your answer.
Now read Sean's personality traits. Determine which is his dominant style, then drag him into
the appropriate quadrant and click Submit to check your answer.
Now read Susan's personality traits. Determine which is her dominant style, then drag her into
the appropriate quadrant and click Submit to check your answer.
Finally, read Chang's personality traits. Determine which is his dominant style, then drag him
into the appropriate quadrant and click Submit to check your answer.
The remaining 4 people have been placed in their appropriate quadrant. Click on each to see
why.
1.38 Bringing Participants Onboard
You have selected the components for your Mastermind Group Alliance, and have determined
how you will mix them together.
But if you want good chemistry, you still need to add both heat and pressure. You want
people to have a warm feeling about being invited - but you also want them to understand
that they’ll be expected to contribute hard, serious effort.
1.39 Add Heat and Pressure
First, the heat.
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As CEO or sponsor, it is very important to speak personally with each candidate for your
Mastermind Group Alliance. Explain that you see the Alliance as your “brain trust” of the
best and brightest minds in your business -- and that you would be honored to have them
onboard. Tell them that this is going to be an opportunity to participate in transforming the
business. Explain why you selected them, and how eagerly you look forward to working
closely with them as part of your Mastermind Group Alliance.
Next, add a little pressure.
Remind them that the road ahead will be challenging and the work will be hard. This is
serious business - in fact, the company’s future direction depends on the work done in the
Mastermind Group Alliance. Only the truly committed should accept the invitation.
And then, ask them to join you.
1.40 Invitation Letter
If they are willing, give them an invitation letter. The letter should explain your goals for the
Mastermind Group Alliance. It should state the nature of the commitment that you expect
from them. If appropriate, it should also explain the duration of the commitment you are
requesting.
The letter should also lay out some general principles:
• That you expect them to keep the invitation and any other Mastermind Group Alliance
matters confidential.
• That, as part of their Mastermind Group Alliance work, they will be expected to
complete a learning program and prepare thoroughly for each session.
• That you are not looking for people to rubber-stamp previous strategies. This is an
opportunity to look at things differently, question old assumptions, and consider new
ideas.
• That you expect people to work together in a spirit of cooperation and harmony. No
individual will get credit or blame for ideas shared in Mastermind Group Alliance
meetings. The ideas belong to all.
• That they will be asked to follow a rigorous, systematic thinking process that will help
them see the business in exciting new ways
• Explain when and where the kick-off meeting will be held. That is where you will provide
logistical details, divide them into groups, and get the program rolling.
1.41 What About the Others?
Of course, word will soon leak out about the Mastermind Group Alliance. And some people -
people who may have been quite deserving but who didn’t get invited for one reason or
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another will discover that they are not on the list.
You don’t want to lose them. You don’t want them to feel they have no future in the
company.
So take action. Be forthright. Talk to them directly, explain what you are doing and that you
had only a limited number of slots to begin with.
But in the future, you expect to be expanding the program. And you want them to know that
you look forward to including them in that later wave - because you see them as important to
your company.
1.42 Summary
1.43 Prepare for MGA Success

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1.44 Preparing Your Mastermind Group Alliance for Success
Making a Mastermind Group Alliance work is a bit like putting on grand opera.
If you want a spectacular performance, you need to select the best possible troupe of singers
and musicians. And you want to select an orchestra conductor who can pull the most
powerful music from your troupe. But you also have to pay attention to what happens behind
the scenes. That spectacular performance can’t take place unless someone has set the stage
and turned on the house lights.
In other words, every Mastermind Group Alliance needs its Impresario - the producer or
sponsor who is behind the curtain - making it possible for the performers to shine.
1.45 Set the Stage for Success
As sponsor, it’s up to you to set the stage for success.

Partly, that means setting up an infrastructure that allows your Mastermind Group Alliance
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can do its job.
You’ll be asking participants to complete eLearning programs, experiment with new

techniques, and attend meetings.
They’ll need time, technology, physical space, and administrative support, if you want them
to accomplish great things.
1.46 The Sponsor Sets the Tone
As the Mastermind Group Alliance’s sponsor, you are also responsible for setting the tone for
the program.
Keep in mind that group members are people who have been successful in your organization -
which means that they have learned how to read you. So if you don’t really intend to change
anything, if you are just going through the motions, they will figure it out quickly - and they
won’t bother putting much effort into the program.
By the same token, if group members sense that you are excited about the program, if they
see that you are willing to invest time and resources, if they believe that you intend to listen
with an open mind to their suggestions, they will give you their whole-hearted commitment --
not to mention the creative, innovative ideas you need to springboard your organization to
the next level.
1.47 Demonstrate Your Priorities
As sponsor, your first order of business has to be to communicate that you believe what
happens in the Mastermind Group Alliance meetings is urgently important to your organization.
Here are some ways to communicate that message:
Show that you are willing to invest time into the program. That includes your time as well as
the other Mastermind Group members. They will begin to believe when they see that you are
completing your eLearning assignments, or scheduling business trips around Mastermind Group
meetings. One important way to signify commitment is to make Mastermind Groups a cellular free zone.
The person who makes or receives a call is going to be out of the meeting, whether
mentally or physically, both during the call and probably for 10 to 15 minutes afterwards.
Instead, plan on taking breaks every 2 hours or so, when participants can handle their
communications.
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Demonstrate your commitment by investing resources in the program. It goes without saying,
you already are allocating a certain amount of the participants’ salaried time to Mastermind
Group efforts. But consider investing in a few perq’s that convey the message that the work
this group is doing is especially significant. Be sure to assign an admin person - someone with
executive security clearances - to support each 7-member group.
And finally, think about offering some sort of incentive or reward, as a tangible
acknowledgement for their innovative thinking and focused commitment.
There is one more important way to demonstrate the importance you give to Mastermind
activities. You are used to being the thought-leader - but in the Mastermind Group meetings,
you need to take a secondary role. Remember, the point of the exercise is to leverage the
brainpower of others in your organization. The importance of this can’t be overstated. As
CEO, start by listening. Ask questions - you’ll find a good list of Socratic Questions in the
Module 1 Implementation Guide - and take notes about the answers. Then, and only then,
should you share what you are thinking and feeling. In this way, you will get full value of the
group’s thinking - and you will learn who the strongest strategic thinkers are in each group.
By the way, this is one of the reasons for asking the C-level executives to rotate among the 7-
member groups - so they don’t come to dominate the thinking in any group.
1.48 Be a Positive Force
As a leader, you need to be self-aware - and you need to use that self-awareness as a positive
force for changing your organization.
Have you read Carlos and Jay’s e-book, “ “The CEO Who Sees Around Corners?” It comes
packaged with the program - and reading it should be mandatory for everyone in your
Mastermind Group. The book was written to help you change paradigms. Each chapter has a
different purpose, and they are all important. But, as the group sponsor, we particularly
recommend that you re-read Chapter 2 on self-awareness.
Why? Because everyone in the room is looking at you and picking up on your emotional state.
So, be an inspirational leader and an aspirational leader.
Leave negativity at the door. Expect a positive outcome from the Mastermind Group - and
show it. Your faith in the outcome will transmit itself to your group, and pay off in powerful
ideas that can transform your organization.
1.49 Foster Collaboration
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A friendly, strengthened collaboration is the oil that lubricates your Mastermind Group
Alliance.
You want to create an atmosphere where everyone’s ideas are welcome. To judge these ideas,
make broad use of the Socratic questions, pages 59-60 in your Implementation Guide. These
questions will make the group come up with factual assumptions to enlighten their strategic
thinking.
Don’t hesitate to consult electronic calculators that you can freely access to our website.
The quality of the ideas is what is important - not whether they come from the boss or your
resident expert.
In fact, it’s often the people who have less experience on a topic who are best able to
question assumptions and look at things from a different perspective.
It’s most important to foster an egoless marketplace of ideas. In the Mastermind Group
process, ideas can’t belong to any individual. No matter who suggested the idea originally,
everyone in the group gets a chance to pull it and shape it so that it truly belongs to the
group as a whole.
1.50 Maintain Security

If you think about it, what you will be discussing in your Mastermind Group meetings is really
the future of your business.
So what happens in the Mastermind Group needs to stay in the Mastermind Group.
Set rules in place to maintain security.
Keep the door closed during meetings.

Take precautions to keep Mastermind posters secure.
Discourage participants from carrying the discussion beyond the meeting room, where others
might overhear.
And as always, remember that participants will take their cues from you. If you behave as if
you care about security, the rest of the group will care about it too.
1.51 Summary
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1.52 Facilitate MGA Sessions
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1.53 Tips for Facilitating Mastermind Group Alliance Sessions
In this section, you will learn tips for facilitating Mastermind Group sessions.
1.54 What Does a Facilitator Do?
Let’s start with the basics. As a facilitator, your role is to lead Mastermind Group’s sessions.
Your ultimate goal is to keep group sessions productive.
Here’s a useful metaphor: Think of the facilitator as an orchestra conductor - not a soloist!
Just like the orchestra maestro, you need to keep your group synchronized, making sure that
each one is fully engaged in playing their part, but not dominating the discussions.
And just like that maestro, you will have a score in front of you. But rather than musical
notes, your score looks like an Implementation Guide, posters, and lists of Socratic questions
to guide you through a structured set of activities.
1.55 Before the Session
Here’s what to do on your own, before the group session:
First, read through the block of information in the Implementation Guide, just to refresh
yourself on what is available there.
Pay particular attention to the Action Steps listed in the Guide. Read through the instructions
and make sure you understand them. Make sure you can find any posters that will be filled
out as part of the Action Steps. Also, if you will need to refer back to previous posters, make
sure you can find the versions your group filled out previously.
Now think about any materials that you might need during the session. Will the group be
brainstorming before you enter final entries on your posters? If so, have a pad of flip charts
and some markers available. Will your group need to look back at certain previous posters? In
that case, either print out the relevant posters or make them available in digital form. Just
make sure to do it before the session, so the group can concentrate on working forward
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productively.
1.56 Keep These Questions On-Hand
Here is one more thing that you may want to do in preparation. Take a moment to review the
“Ideas for Questions to Ask”, that is printed in Block 1, page 59 of your Implementation Guide.
You may even want to make a copy of these to keep in front of you during the session.
If the group gets stymied, you’ll be glad to have these questions available so you can get the
discussion back on track.
1.57 Know the Rules of the Road
Finally, before the first session, take a few moments to review the first two posters from
Module 1 of Creative Leadership for Turbulent Times.
The first poster lays out the goals and expectations that your Mastermind Group hopes to
accomplish. The second poster lists the rules of the road that your group has committed to.
As facilitator, it’s useful to keep the content of these posters fresh in your mind. If the
discussion appears to be drifting in a different direction, consider reviewing these posters
with the group as a whole to help them get back on track.
1.58 Conducting the Session

At the beginning of the session, take a moment to summarize what happened in the last
session, and what you hope to accomplish in this session.
Give the page number of the first Activity Step that you will cover. Read the instructions out
loud. Project the posters that you will be using. Make sure everyone understands the goal that
you are trying to accomplish.
Next, lead a discussion about the question on the poster. Don’t settle for the first answer.
Make sure that the group probes deeply and questions assumptions. This is where you’ll be
glad to have that list of Questions to Ask in your pocket.
During the discussion, have a scribe record the group’s findings on a flip chart. When the
group appears to have talked-out the issue completely, ask the scribe to enter your findings
on the electronic poster. Advantage: At the end of the session, each participant can have a
copy immediately available.
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You’ll notice there is a limit to how much room is on each poster. That is going to force you -
as a group - to tighten up your answer so it is clear but succinct. After the final wording has
been entered, ask the group if they all agree that it conveys the thinking of the group. And
here is the important thing: Don’t move on until you get agreement!
Make sure the scribe saves the completed version of the poster.
Then move on to the next Activity Step, and follow the same process until you have
completed all of the steps in that block.
1.59 Making Decisions
Here is a common question. In your Mastermind Group, does everyone have to agree with
every decision you make?
No. As a practical matter, go with “Majority rules!” In other words, encourage a vigorous
discussion; but be sure that a majority of the Mastermind Group members agree with the
answers that are entered into the digital posters.
1.60 People-Centric Facilitation
As facilitator, your goal is to get the best thinking from everyone in the group - while
maintaining harmony.
You want to hear from everyone, without letting anyone monopolize the conversation. You
need to create an atmosphere where everyone feels their contribution is valued.
But different group members have different personality styles. Each style has its strengths
and weaknesses. And sometimes, the different styles clash.
As facilitator, it’s up to you to prevent friction. You have to apply just enough lubricant to
keep the group’s mental wheels turning in synchronicity. And, as a practical matter, you’ll
have to adjust that lubricant for each different personality style.
1.61 Practical Problems in Facilitation
Here’s a quick exercise to help you think about how to adjust your facilitation style based on
the personalities in your group.
Here are the other 6 members of your group. You can learn about each member’s personality
style by clicking on their picture.
Take a moment to consider the attributes of each member. Then click Next to continue the
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exercise.
1.62 Problem #1: Driver Error
You have just asked the Mastermind Group to identify causes and effects of performance
issues.
John, your CEO, immediately jumps in with his answer.
Why is John’s answer a problem? Choose all of the answers that seem correct. Then click the
submit button.
------------------
ANSWER:
John is a typical Driver. He’s also the CEO, so the others in the group are used to letting him
take the lead.
So when he says that all of our problems are due to a single cause, he is not leaving room for
other opinions.
And then he jumps right into solutions mode - saying that training will solve the problem
He even drifts into operational thinking, by focusing on the nuts and bolts of how much
training, etc.
He’s not rude - but if you let his answer stand, he will suck all of the oxygen out of the
discussion and lead the group somewhere where they should not go.

As a facilitator, how should you respond to John?
Here are 4 possible responses. Think about your answer and then click "Next" to continue.
Your best response is to accept John’s suggestion but rephrase it so it becomes just one
possible cause. Then get the group focused on offering more causes.
Did you prefer a different answer? You can click each answer on the screen to find out why it
was right or wrong.
1.65 Problem #2: Silent Chang

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Here’s another typical problem.
You are having a fine, productive discussion, with lots of good interaction.
Except for Chang, who has gone silent.
He appears to be paying attention. He just hasn’t volunteered his opinion for a while.
What should you do?
As facilitator, what should you do about Chang? Click the best option. Then click Submit.
------------------
ANSWER:
Chang is a typical Analytical. He has lots of important input to offer. But Analyticals often are
quiet and hard to read.
So if you want to hear from Chang, and you don’t want to slow the meeting down by waiting
for him to get around to volunteering, you will need to actively seek his input.
Don’t wait until a break. By that time, the discussion may have turned to a different topic.
He’s not rude - but if you let his answer stand, he will suck all of the oxygen out of the
discussion and lead the group somewhere where they should not go.
As a facilitator, what should you do to get Chang participating?

Here are 4 possible responses. Think about your answer, then click "Next" to continue.

Your best response is to ask Chang point-blank for his input. Just do it in a way that makes
him feel valued, not threatened.
Did you prefer a different answer? You can click each answer on the screen to find out why it
was wrong or right.
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1.69 Do's and Dont's
Here are some facilitation do’s and don’ts to keep in mind.
• Prepare beforehand, so you don’t get distracted by administrative issues during the
session.
• Bring your A-game. Facilitation is a high-energy activity. You will need to focus and
concentrate hard throughout the session.
• Keep an open mind. Your job is to encourage other opinions and ideas, even if they
are different from your own.
• Don’t settle for the first answer you hear. Make sure you are asking the probing
questions that make group members think differently about the question.
• Avoid operational issues. The group’s focus is on strategies. But inevitably, that will
inspire people to think about how the strategy will impact their functional area. In a
flash, the group will get side-tracked in discussions about how to make a solution work
here, or what solution won’t work there. As facilitator, it’s up to you to shut down
operational discussions and get back to talking strategically.
• Strive for balance. Everyone in the room has an important point of view, whether or
not they have experience on a particular topic. Don’t let any self-appointed experts do
all the talking. If others aren’t speaking up, ask them what they think.
• Maintain harmony. People may see things in different ways, but don’t let it get
personal. Remember, you are all working toward a single, common goal - doing what is
best for the business.
• Finally, be aware of bio-factors. It’s up to you to set a pace that is productive – but remember
that you are dealing with human beings. So be aware of the energy level in the room. If the
discussion is getting sleepy, try passing around some candy or suggesting a 5-minute stretch
break.
1.70 Passing the Baton
Now that you know what’s involved in facilitation, you might be wondering…am I the right
person to be doing this?
The answer is yes!
By rotating the facilitation duties, everyone learns how to do it well. After you’ve facilitated,
you’ll have a new understanding of what the group dynamics are, which will make you a more
effective group member.
Each time you facilitate, it will be easier - as both you and the rest of the group get used to
the rhythm of the discussions.
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And facilitation will help you sharpen your communication skills. It helps you to express your
point of view inside your 7-member Mastermind Group; prepares you to explain your group’s
thinking when the 21-member Mastermind Group Alliance meets; and puts the power of the
Mastermind approach in your hands, as you lead other groups to see clearly and find creative
answers through a Mastermind Group Alliance.
1.71 Facilitating a 21-Member Session
Most of the time, the Mastermind Group Alliance consists of 3 groups of seven people each,
all working in parallel.
But when the 3 groups all complete a key milestone event - such as completing all of the
activities within one module in your Implementation Guide - then it’s time to convene a 21-
member event.
The purpose of this session is to create a consolidated set of findings, featuring the best
thinking from all the groups.
Conducting this session usually takes an hour or two.
Begin by asking each group’s spokesperson to present their final posters. For example, in
Module 1, the groups would present their 10-12 key strategic initiatives. If the group has
questions, the spokesperson should be prepared to present additional posters, to explain how
the group reached its decisions.
After all 3 groups have presented, allow a brief review period, where individuals can review
and discuss the content of all 3 sets of final posters.
Finally, create a consolidated poster, by asking members to identify which findings they want
to include. If there were significant differences among the groups, this might require some
debate. If there is sharp disagreement, you could even allow a few days for reflection before
making a final decision. Either way, your end-product should be a unified set of findings that
each of the groups will then adopt - so all 3 groups are once again working forward toward a
well-understood, unified strategy for your business.
1.72 Remember!
However, never forget after finishing each one of the six processes, the CEO has the right to
decide, either alone, or after submitting the strategies to the Board. The CEO or the Board is
still in charge, and can make changes or decline any decisions made by the Mastermind
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Group Alliance.
1.73 Summary
Here is a quick summary of the key points of this section of the webinar.
1.74 Final Thoughts from Carlos
Clients and CEOs sometimes ask me what makes a Mastermind Group Alliance unique, singular, and
powerful.
And my best answer is, that it’s the ultimate leadership tool.
It’s tangible proof that you have confidence that your business can prosper in turbulent times, and that
you believe your key people can help you make that happen.
It’s in fact, a systematic method for amplifying your personal strategic insights, so you truly
become “The executive who can see around corners.”
It’s also an engine for transforming your culture, by creating an internal leadership squad who
is equipped to quickly get the rest of your organization aligned and focused on implementing
your new strategies.
It is Jay Abraham's and my wish that this webinar has been helpful to you. If you have
additional questions, please let us know.
Webinar 2:
Breakeven Analysis and Contribution Margin
1.1 Webinar Intro
(music)
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1.2 Introduction
Welcome to the webinar. I’m Carlos Dias.
As a leader, your priority must be to understand reality. You need to know which direction
makes good financial sense for your company - and which direction could get you into trouble.
This is particularly important in turbulent times, when it is dangerous to rely on outdated

forecasts of market growth. In an uncertain world, you need tools that can show you
instantly - based on current data - which way is the right path that will lead to profitable
growth.
1.3 Common Dilemma
Here is a common dilemma. One of your executives has proposed an innovative new product.
Does it make sense for your business to invest in it?
Of course, you can wait for your CFO to run a full financial analysis of the project.
But before you do that, you need a quick way to evaluate for yourself:
• Can we make a profit with this?

• What level of incremental sales do we need before we can be profitable?
• Can we realistically make that level of sales in a reasonable amount of time?
•
In this webinar, we will show you how to use our Breakeven Analysis and Contribution Margin
Calculator to quickly evaluate a project’s potential - so you can choose the strategic direction
that will put your business on its most profitable path.
Here is our narrator, Scott Schmeer, to tell you more.
1.4 Menu
Please select any menu item.
1.5 Why Breakeven Matters
This section will explain the concept of breakeven.
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1.6 Breakeven
Here are 3 businesses.
Business 1 is profitable, because its sales are higher than its costs.
Business 2 is losing money, because its sales are lower than its costs.
Business 3 is using all of its sales revenue to pay for costs. There is no leftover profit or loss.
In other words, it is at “breakeven”.
1.7 Fixed - or Indirect – Costs
Let’s look more closely at costs.
Some costs are known as “fixed costs.” Every business has them, to some degree. These are
the costs that are incurred steadily, no matter whether your business is doing well or not.
For example, the rent on your premises does not fluctuate - you pay the same amount each
month, no matter what your monthly sales volume is. Sometimes, “fixed costs” are called
“indirect costs.” Why? Because they are not tied directly to any of your ongoing business
activities.
1.8 Variable - or Direct – Costs
Other costs are known as “variable” or “direct” costs. You incur a variable cost every time a
sale is made.
Therefore, variable costs change in proportion to your level of business activity.

Any cost that is directly related to getting your product or service into your customers’ hands
is a variable cost. For example, when your customers order more products, you will need to
pay for more raw materials and also for more labor to manufacture your product.
Direct costs can usually be found under the Cost of Goods Sold in your Profit and Loss report.
1.9 Total Costs
Your total costs include both fixed and variable costs.
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This chart shows how total costs are impacted by increased sales volume.
The fixed costs remain steady, no matter what happens to the sales volume. As a result, fixed
costs account for a lower and lower percentage of the overall costs as sales improve.
By contrast, variable costs rise in proportion to sales volume. Compared to fixed costs,
variable costs account for a higher and higher percentage of overall costs as sales improve.
1.10 Focus on Total Sales
Now focus on total sales for a moment. Have you noticed that it rises more steeply than
variable costs on the graph?
That is because sales revenue always includes a margin to cover fixed costs, as well as a
contribution to profit. This is known as gross profit. The greater the margin that is included in
your Selling Price, the steeper the rise in the Total Sales line.
1.11 Reaching Breakeven
This point where total sales and total costs meet, is known as the breakeven point.
Before the breakeven point is reached, costs are higher than sales. The business is in a loss
position.
When the business finally reaches breakeven, all of its sales revenue is taken up by costs. At
breakeven, the business is neither losing money nor making a profit.
When the business gets beyond breakeven, that is when profits occur. We’ll talk more about
this in the “Why Contribution Margin Matters” section.
1.12 Summary
Here is a quick summary of what you learned in this section. When you are ready, select Next
or Menu to continue.
1.13 Why Contribution Margin Matters
In this section, we will explore contribution margin.
1.14 Contribution Margin
Your contribution margin is the amount left over after you deduct your variable costs from
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total sales.
1.15 How Contribution Margin and Breakeven Are Related
After you have deducted your variable costs, the contribution margin still has to pay for your
fixed costs.
But once the fixed costs are paid for, the rest of the contribution margin is net profit.
Think of it this way. Suppose all of your fixed costs fit into this container. The popcorn is
contribution margin - the surplus that is left over when you deduct variable costs from sales.
At first, all of your contribution margin is used to fill the container. But once the container is
full, everything that spills out is pure, net profit.
1.16 Contribution Margin: Key to Profits
That is why you cannot afford to ignore contribution margin, particularly for those products
representing 80% of your sales and gross profits. You see, your contribution margin - the
surplus after you have deducted variable costs from sales - is your key to profits. Knowing the
contribution margin of each product will help you make strategic decisions about it.
1.17 Using Contribution Margin Strategically
Here are some ways you can use contribution margin strategically.
For example, a product or service should be added only if the increase in total contribution
margin is greater than the increase in fixed costs. And a product should be dropped only if the
decrease in total contribution margin is less than the decrease in fixed costs. You will want to
emphasize products or services with the highest contribution margin per unit of the
constrained resource. You will want to either increase or de-emphasize products or services
with the lowest contribution margin.
Decisions relating to dropping old products or services and adding new ones are among the
most difficult that a manager makes. Therefore, your responsibility as leader is maximizing
the total contribution margin; in doing that, you are maximizing profit too.
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1.18 Talk to Your CFO
Do you know the contribution margin of each product in your line? You should!
Ask your CFO to classify each one of your products or services by contribution margin, and list
them in decreasing order.
Keep this list close by! It will help you to make the right decisions related to your products or
services.
By the way, don’t be surprised if the CFO is a bit surprised when you ask for the Contribution
Margin Report. Carlos tell us that few family business companies think about their products
this way.
1.19 Improving Contribution Margin

Once you know a product’s contribution margin, your goal as a leader should be to improve it.
There are only 2 ways to do this.
You can increase the sales volume, while maintaining the current contribution margin.
Or you can increase the contribution margin - for example, by reducing variable costs -- while
maintaining the same sales volume.
1.20 Summary
Here is a quick summary of what you learned in this section. When you are ready, select Next
or Menu to continue.
1.21 Calculating Breakeven and Contribution Margin

In this section, you will learn how to use our proprietary Contribution Margin and Breakeven
Calculator tool to answer key questions for your decision-making.
1.22 A Proposal
Let’s say that your Marketing Director has proposed an innovative marketing approach for one
of your products. She estimates that it will cost $50,000 to implement the program. She tells
you that she is sure your business will make at least $50,000 in additional sales to pay for the
program.
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You wonder, is this a good investment? If you sell an additional $50,000 worth of product, will
you breakeven? If not, how much in additional sales would you need to make? And if you can’t
increase your sales, how much in either fixed or variable costs would you need to cut in order
to make the investment affordable?
This is where knowing your breakeven and contribution margin is important - because it gives
you the ability to predict how your decision will impact on your profitability and the future of
your organization.
1.23 Contribution Margin and Breakeven Calculator

Let’s use the Contribution Margin and Breakeven Calculator to find the answers. We’ll work
through an exercise together. But you can also click the link on your screen at any time during
this exercise, if you want to try out the calculator for yourself.
Enter your current sales or revenues for the product. You will also need to enter your indirect
costs, as well as your direct costs.
The calculator immediately provides some interesting data about your product that you might
not have been aware of. Your total current costs in this scenario are $1.9 million dollars. That
leaves you with a profit of $100,000 on your sales. Your contribution margin - remember,
that’s the sales minus the direct costs for this product - comes to $800,000, or 40% of your
sales. And your breakeven point - which the calculator gets by dividing the indirect costs by
the 40% contribution margin - comes to $1,750,000. In other words, if everything stays just as
it is now, you need to sell $1,750,000 worth of product in order to stay even. Interesting!
Okay, so what happens if you invest the extra $50,000 in marketing? Is your Marketing
Director’s theory correct, that you only need to make $50,000 in incremental sales to pay for
this investment?
Enter the required investment in the calculator to find out. The calculator shows that, when
you take the associated costs into account, you will actually need to make an additional
$125,000 in incremental sales to breakeven on this investment.
You make a mental note to send the link to this webinar to your Marketing Director - and then
continue to think about the problem.
Now you are wondering, what would your breakeven be if you reduced your indirect costs?
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Let’s say that, because of this campaign, you would be able to eliminate $10,000 in rental
space that you had been using to store print materials.
If you reduce your indirect costs by $10,000, the calculator shows you that your breakeven
point would be lowered by $25,000, to $1,725,000.

The calculator will also allow you to do a similar calculation to see the effect of reducing
direct costs.
Let’s say that you can see a way to eliminate $200,000 of sales expense if you go with the
new marketing approach. Enter the $200,000 decrease in direct costs into the calculator.
Look what happens! Your direct costs go down, obviously. Your breakeven sales point falls to
$1,400,000. And best of all, your contribution margin shoots up, from 40% to 50%. Now you
know what you have to do in order to make this investment have a positive impact your
organization’s profitability!
1.27 Data to Support Informed Decisions
At this point, you have the data to support a strategic decision.
Can you reach the required level of sales to breakeven - or better yet turn a profit?
What if you invested less? How would that impact your breakeven point?
What if you tried cutting costs a little more or a little less? What would happen then?
The Contribution Margin and Breakeven Calculator lets you try out different scenarios, so you
can pick the one that works best for your situation.
1.28 Summary
Here is a quick summary of what you learned in this section.
You might also want to try out the Contribution Margin and Breakeven Calculator at this time.
Just click the icon on your screen to get there. You can also access it through the Executive
Learning Systems website.
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When you are ready, select Next or Menu to continue.
1.29 Final Thoughts from Jay
In this webinar, you got a close-up view of one of the many powerful calculators that Carlos
and I have developed to help you think accurately and strategically about your business. I
know that the Contribution Margin and Breakeven Calculator will help you make better, more
informed decisions that will lead to a profitable future.
You’ll be revisiting this particular calculator in a number of Modules in Creative Leadership

for Turbulent Times, as you work through the structured strategic-thinking activities and
evaluate different options for creating wealth, you’ll go back and see the difference these
calculators make.
But you might also want to bookmark it so you can refer back to it often during your day-today
decision making! Just follow the link on the screen, if you want to bookmark it now.
Thanks for viewing the webinar! If you have additional questions, please let us know.
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Webinar 3:
The Web TrendWatcher™
1.1 Webinar Intro
(music)
1.2 Introduction
Welcome to the webinar. I’m Jay Abraham.
Today, I want to speak with you about how to acquire what every great leader possesses -
wisdom.
Now, by “wisdom”, I’m not talking about intellectual capacity. And I’m not talking about
years of experience, either.
In fact, I’ve noticed that sometimes a high IQ or long years of experience can actually have a
negative effect on a leader’s wisdom. Because in some cases, the high IQ leaders and very
experienced leaders are their own worst enemies. They’ve spent too much time reading their
own press clippings. They’ve become too enamored of their past successes.
They’ve gotten too comfortable trusting their own instincts. They are so sure of their own -
and their organization’s -- greatness that they forget to open their eyes and their minds. So
instead of leading, they just coast. And perhaps that was good enough in the past. But not
today. Not in times of hyper-turbulent change.
Because in today’s world, yesterday’s successful business can quickly become tomorrow’s
cautionary tale. To succeed today, a leader need to develop the wisdom to see things as they
really are - no wishful thinking allowed -- and understand the implications for their business.
In today’s world, true leadership wisdom is the ability to “see around corners”, as Carlos and
I say, to recognize change coming at you and to have the courage to duck before it hits you in
the face. To zig and zag when you need to. Or better yet, to find a way to ride that change to
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an exciting, innovative advantage in the future for your company.
Acquiring true leadership wisdom takes work. It takes discipline and commitment - and an
open mind, a mind that is willing to consider new paradigms, even if that means moving well
outside of your comfort zone.
It also takes a systematic process, a proven method for scanning the environment, identifying
trends, and doing what my good friend Carlos Dias calls "Crap Detection" - a vetting process
for making sure your innovative solutions are based on reality, not hot air.
1.3 The Web TrendWatcher™
Carlos has packaged his scanning process into a powerful system called The Web
TrendWatcher™. It’s a remarkable tool - proven successful in companies around the globe and
in every industry -- with a track record of helping so-so leaders to become wise leaders, and
so-so organizations to utterly break out of the doldrums and become innovative, highlyprofitable
enterprises.
Here is our narrator, Scott Schmeer, to tell you more about the Web TrendWatcher™ and
what you will learn watching this webinar.
1.4 Menu
1.5 Maximizing Return on Intellectual Assets
This section will explain how innovative companies focus on maximizing their Return on
Intellectual Assets.
1.6 Return on Assets Investment
In Creative Leadership for Turbulent Times, we talk about the Wealth Formula - and how
maximizing Return on Assets is the surest path to profitability.
Most organizations do a fairly decent job of maximizing their hard assets - their land, their
equipment, and so forth.
But studies show that most organizations are using only about 20% of their available
intellectual assets. Think about that for a moment. Your competitors are leaving 80% of their
intellectual assets on the sidelines. But if you find a way to leverage your unused intellectual
assets, you’ll enjoy a huge competitive advantage - and your profits will skyrocket.
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1.7 One Type of Intellectual Asset
One category of intellectual asset - and one of the most lucrative - is innovative ideas. The
opportunity to find and exploit new, innovative ideas increases in hyper-turbulent times, as
unrelenting change makes old ideas and old products obsolete very quickly.
1.8 A Funny Paradox

But here is a funny paradox. In our increasingly competitive world, at the same time that we
are looking for innovative ideas, we also are striving for predictability and the reduction of
uncertainty.
It’s human nature. We have a built-in bias toward rejecting new information - sometimes
perfectly reliable information - because it conflicts with our internal preconceptions.
As a result, we may be discarding ideas that could have created the very competitive
advantage we were looking for.
1.9 Ahead of the Curve
Have you ever wondered why some organizations always seem to be ahead of the curve - with
groundbreaking new products and services, year after year?
Is it because they have the biggest Research and Development budget? Or the smartest
engineers? Or the highest paid consultants? Not really. All of these miss the point.
Because innovative organizations understand that knowledge alone won’t empower you. To
truly innovate, you need a process for collecting focused business intelligence, analyzed
information, and appropriate proven knowledge. Why? Because these intellectual assets
are the engines that can reliably power creative new products, approaches and strategies.
1.10 Study in Innovation: Apple
Here is a classic example - Apple.
If you think about it, Apple’s innovations have revolutionize their industry - and our world - 5
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different times.
• Back in the 1970’s, computers were used only by a few specially trained people - and
only in the workplace. But in the 80’s, Apple played a major role in developing a
transformative new product -- the personal computer. PC’s transformed the market -
breaking the back of many entrenched mainframe and minicomputer companies, while
creating exciting new opportunities in the consumer and small business space.
• Let’s fast forward. Remember these things? CDs displaced vinyl records and tape
cassettes. Music publishers enjoyed a high mark-up on CD albums, not to mention their
near stranglehold on access to musical content. A few companies - like Phillips and
SONY - tried offering MP3 players. But they were expensive, and only contained
enough memory for a CD’s worth of music. Besides, it was hard to find content for
these devices. Even Napster was still pretty new at the time. So the CD industry was
blind-sided in 2001 when along came Apple’s new iPod , with a sleek, simple design
and plenty of iTunes content.

• There were more transformative products to come. Steve Jobs and his team
temporarily left Apple for Next and Pixar - and revolutionized digital movies.
• The iPhone pretty much created today’s multi-billlion dollar smartphone industry. And
no matter what the competition does, Apple just keeps coming up with new iPhone
versions that customers clamor for. Think about it for a moment. Apple introduced the
iPhone in July 2007. In 2012, their iPhone sales reached $100 billion. That is more
than all of Microsoft’s sales in the same year.
• And then there’s the iPad. Apple’s smaller, lighter, more portable tablet is once again
transforming the way consumers use computers - while making laptops obsolete.
1.11 What Made Apple Great?
For those of you who are thinking, “That’s great for Apple, but I’m no Steve Jobs,” again,
you’re missing the point. Steve Jobs didn’t create all of that innovation alone. He had a team
of talented executives and engineers working with him.
What truly made Steve Jobs stand out was the culture of innovation that he inspired
throughout his organization.
A culture that actively sought out new ideas. A culture that challenged the status quo in the
marketplace. A culture that not only encouraged executives to think divergently, but actually
put into place the processes for them to do so.
1.12 Study in Innovation: Zara
Innovation can happen in any industry. Let’s look at Zara for example.
If you know the fashion industry, you know the name Zara, owned by parent company Inditex.
In the past, apparel retailers purchased high volumes of merchandise from designers, who
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updated their collections twice a year. By contrast, Zara’s innovative global strategy is to
stock a small volume of each item, but to update their collections as often as twice a week.
As a result, customers are motivated to stop in frequently to see the latest items - and they
purchase quickly, while the item is still in stock. No wonder Zara has been thriving while
other mid-price department store chains have gone out of business.
Zara also innovated in the placement of its stores. Other mid-price chains locate their stores
in malls or city locations that cater to a mid-price customer. Zara, on the other hand, locates
its stores as close as possible to the high-end retailers -- who are suffering by comparison. If
you shop at a pricey designer boutique these days, you’ll notice the collections are being
updated more frequently - all because they are trying desperately to compete against Zara.
How well is Zara they doing? In 2012, while the rest of the Spanish economy struggled, Zara
had close to $20 billion in worldwide sales, with an impressive 18% Return on Assets.
How did Zara do it? By looking at knowledge and understanding its implications - in this case,
the demographic trend line that predicted a huge growth in the middle class. Zara positioned
itself to serve the needs of these aspirational consumers who had high-fashion taste but
middle-income budgets. In the process, it has turned the fashion industry upside down.
1.13 A Study in Innovation: DODOcase
Both Zara and Apple are large companies. Does your company have to be big in order to
innovate successfully?
First of all, being a huge company is no guarantee of successful innovation. Look at Hewlett
Packard for example. HP was the leading electronic printer company in the world - but its
product line did not move with the times. Customers rejected their new product offerings.
New competitors ate into their market share. After a decade of missteps, HP capped off 2012
with a scandal that threatens its Board and its Senior Management. It will be interesting to
see in 2013 if this company can find a way to reclaim its brand image - and its share price!
So size is no guarantee of successful innovation. And it isn’t a barrier, either. Take DODOcase
for example. DODOcase’s founder, Steve Buckley, came from a publishing family. He could
see the downward trajectory in the book business. So he opened his eyes, searching for other
opportunities. As soon as he saw the iPad, he realized it was going to transform the way
consumers interacted with books - much the way the iPod changed the way they interacted
with music.
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What were the implications of these trends? There would be lots of consumers who needed a
case for their new iPad. There would be lots of consumers who would enjoy the convenience
of reading on their tablet device - but would miss the aesthetic of an old fashioned book. And
there would be lots of book binderies who suddenly found themselves needing work. Buckley
moved quickly to create a product. He short-cut the design process by outsourcing some of
the design steps and using today’s low-cost, 3D printing technology to create mockups. To
produce his product, he tapped into his family’s Rolodex of book bindery contacts.
The rest is history. Buckley’s product, the DODOcase for the iPad, married the look and feel
of a book to the high-tech elegance of an iPad. The case was an instant hint with consumers.
Buckley continues to grow his line with cases to match new tablets hitting the market.
Although he doesn’t share sales figures, his small company seems to be thriving. In just two
years, he has purchased his own bookbindery and has over 20 full time employees.
1.14 The Common Thread
What is the common thread behind all of these successful innovators?
They all harnessed the power of “intelligence”.
By intelligence, we mean intentionally gathered, focused information and knowledge that has
been analyzed and vetted.
1.15 What Can Intelligence Tell You?
Your intelligence process can tell you about resources - the assets that you and also your
competitors can use to increase organizational wealth.
Intelligence can tell you about capabilities - the abilities and skills that you are able to bring
to bear, and how those compare to your competitors.
And intelligence can tell you about intentions - the aim or purpose that you are trying to
achieve, and the aims and purposes of your competitors.
1.16 What's the Alternative?

In a competitive and fast-changing environment, what happens if you lack focused
intelligence, analyzed information and appropriate proven knowledge?
The answer is, you fly blind. You fall back on your reason, your logic, what is often called
“common sense.”
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Here’s the problem: If you are not continuously updating the knowledge that underlies your
logic, then common sense can actually harm you and your organization. Why? Because
common sense is all about making assumptions about your world - assumptions based on what
was proven to be true in the past. But in hyper-turbulent times, what was true in the past
may no longer be true today, and certainly won’t be true tomorrow. If you don’t have some
sort of mechanism to update what you know, you will soon find yourself in trouble.
And if you have that mechanism in place, you just created a huge competitive advantage for
yourself!
1.17 The Intelligence Cycle
How many of your competitors are systematic about collecting intelligence? Here are the
steps they should be following:
Step 1: Setting priority requirements. In this step, you decide what information to collect and
what information to ignore.
Step 2: Gathering sources of information. In this process, you identify multiple sources - but
selectively, looking for sources that are trustworthy and reliable.
Step 3: Analysis, using the Web TrendWatcher™. In this step, you use a variety of techniques
and questions to determine if the information you have collected is fact or assumption - and
to classify assumptions as either factual assumptions or dubious assumptions. This step is key
to detecting opportunities that you can act on.
Step 4: Spreading and sharing information. Intelligence is a perishable commodity. You need a
system for disseminating it quickly, so the right people in your organization are alerted to the
opportunity.
And finally, Step 5: Action. This step requires leadership and it requires courage. This is the
moment when you stand up and say, "Based on what we now know, this means that our
company should make a move."
1.18 The Result: Foresight
What is the result of following a systematic Intelligence Cycle? You equip your organization to
predict what is likely to happen - so you can use it to shape your organization’s future.
Most of your competitors have good hindsight - they can see and understand what has
happened in the past, and what they should have done differently. But that won't help much
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in times of hyper-turbulent change, because the future will be so different. If your
competitors are relying on hindsight, that is good news for you - because in times of hyperturbulent
change, relying on experience can actually be harmful.
Meanwhile, you have positioned your organization to face forward - so you can see the future
and what it could mean for your organization.
1.19 Creating Intellectual Assets

Earlier in this webinar, we spoke about the importance of leveraging intellectual assets.
By installing a systematic intelligence cycle into your organization, from which you can
harvest a stream of new knowledge that is proven and credible, you will have created an
intellectual asset that you can use to create wealth for your organization.
But remember, the value of this intellectual asset is a function of the thinking that went into
it. If your intelligence cycle is based on one-dimensional thinking, your resulting intellectual
asset will be of limited value.
That is why Carlos and Jay emphasize implementing your Intelligence Cycle within the
framework of a Mastermind Group Alliance. In a Mastermind Group Alliance, knowledge and
ideas are analyzed by people with different areas of expertise, different backgrounds and
different points of view - but all with the best interest of your organization’s future at heart.
Working together, you can transcend individual limitations. You can begin to think divergently
- like the teams at Apple and Zara did -- and find innovative ideas that will power your
organization to a successful future.
1.20 Summary
Click next when you are ready to continue.
1.21 About the Web TrendWatcher™
This section explains what the Web TrendWatcher™ tool is and how it works to power
innovation.
1.22 The Web TrendWatcher™
The Web TrendWatcher™ is a powerful, proven, easy-to-use tool for analyzing the external
patterns and trends in your industry that could affect your organization’s future.
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The tool guides you through a process for scanning each set of factors on your screen.
For each set of factors, the Web TrendWatcher™ participants answer 6 powerful, proven key
questions.
When the resulting answers are quantified and plotted visually, a picture emerges of the
trends and breakthroughs that are most likely to impact your business over the next 3 years -
and clearly showing you the most significant opportunities and threats facing your
organization.
There is a term for knowing those opportunities and threats before they arrive. It’s called
“competitive advantage.”
1.23 Wisdom
Carlos tells us, “Wisdom is seeing things as they really are.”

The Web TrendWatcher™ exercises will help you break through denial and preconceptions -
and reveal reality.
1.24 Conducting the Web TrendWatcher™ Sessions
You can find detailed instructions for running Web TrendWatcher™ sessions in Module 1, Block
3 of Creative Leadership for Turbulent Times.
We suggest that you complete the Block 3 eLearning program, to get a full preview of each
step in a Web TrendWatcher™ session.
Then swing over to Block 3 of the Implementation Guide, where you will find step-by-step
Activity Steps and links to online posters to be used in the session.
1.25 Summary
1.26 Turbo Charging Your Web TrendWatcher™ Sessions

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In this section of the program, you will learn tips for turbo-charging Web TrendWatcher™
sessions, as well as answers to Frequently Asked Questions about the Web TrendWatcher™.
1.27 Frequently Asked Question
One of the questions that senior executives often ask Carlos is, how often should they run
Web TrendWatcher™ sessions?
Carlos suggests running these sessions twice a year, every year. Here’s why.
As you know, knowledge is changing at an accelerated pace. By running Web TrendWatcher™

sessions twice yearly, you build in a mechanism for keeping up with changes in topic areas
that are particularly relevant to you.
Also, as you will learn when you begin to work with the Web TrendWatcher™ tool, preparing
for sessions creates a sort of momentum in your Mastermind Group Alliance. Your executives
will have learned how to seek out and think about new knowledge. They’ve laid down a
baseline of information and sources on certain topics - as well as an interest in a wider
variety of relevant topics. By running the Web TrendWatcher™ twice yearly, you can leverage
your executives’ new skills and knowledge.
1.28 Preparing for Success
Your Web TrendWatcher™ participants will need to prepare, staring well in advance of the
formal Web TrendWatcher™ sessions.
You can get them off to a strong start by assigning mandatory reading - chapters 1 & 2 of "The
CEO Who Sees Around Corners". That’s the book by Carlos and Jay which comes with the
welcome package for "Creative Leadership for Turbulent Times". In chapters 1 & 2,
participants will read about the near-fatal mistakes of companies such as Rubbermaid or
Chrysler - mistakes that came from planning based on hindsight rather than foresight. They’ll
also learn how to develop a sort of personal filter for assessing new knowledge that comes
your way - what Carlos calls a Crap Detector - so you can tell whether you are dealing with
facts, factual assumptions, or dubious assumptions.
1.29 Create a Knowledge Repository
Also well in advance of Web TrendWatcher™ sessions, you and the other participants need to
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take time to read, read, read -and talk to credible people from inside and outside the
organization - about your industry, your customers, your market, and your world.
You are looking for interesting ideas and trends - but remember to filter your findings through
your Crap Detector. One of your goals should be to identify go-to sources of information that
you can rely on. Focus on articles from credible publications - The Financial Times is one of
Carlos’ favorites. And try to determine whether an author or expert is influenced by a
personal agenda, rather than reality.
1.30 Maintaining Your Knowledge Repository
As you come across interesting, relevant ideas or articles, save them in 6 files - one for each
of the Web TrendWatcher™ categories.
Ask each of your Mastermind Group Alliance members to take charge of one of the files. That
way, everyone will know where to send clippings, links, or notes of relevant conversations, so
they can be shared across the team. The person in charge of the file is tasked with collating
all submissions into the file, and making sure there are copies available for everyone when it
is time for a group session.
1.31 Collating the Files
Before the formal Web TrendWatcher™ session, the person in charge of the file - either alone
or with other interested parties - should evaluate the material in the file. The interested
parties could be Mastermind Group Alliance participants, as well as others who are
knowledgeable about the topic.
As the Web TrendWatcher™ becomes part of the culture of your organization, you’ll find more
people stepping up to make suggestions or state an interest in being part of this group.
Now collate the file by designating items as “A” for very important; “B” for important; and
“C” for less important.
Make sure that each item qualifies as a fact or factual assumption - these are the only types
of items that should stay in the file. If you are not sure whether you are dealing with a
factual assumption or a dubious assumption, you may need to hold a separate meeting to
investigate further.
Be sure to include your source and date for all information, including your source for
determining whether the material is factual.
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1.32 Your Collated Files Are...
Let’s consider what you have created at this point. You have 6 sets of raw information about
key trends, all of it relevant to your company, divided by level of importance, and predetermined
to be fact or factual assumption.
What you have created is an intellectual asset that you can use to spark ideas and innovative
thinking.
Now you are ready to start a Web TrendWatcher™ meeting!
1.33 Tip for the CEO
Here is a tip from Carlos.
If you are a senior executive or CEO, you should be checking on the 6 files frequently before
the Web TrendWatcher™ meeting.
Checking the file will give you a heads-up about trends and new knowledge relevant to your
business.
It will also have a side-benefit. If people see that you are interested in these files and
monitoring what is in them, they will pay more attention to them. Each time you check on
the files, you take another step toward incorporating an open, innovative mindset into your
organization.
1.34 Another Tip

Carlos offers one more tip - and it is relevant to both the CEO and other members of the
Mastermind Group Alliance.
Every idea includes an element of risk as well as opportunity. No matter what your situation,
you will always face having a finite pool of resources - time, money, people - so choosing to
pursue a new idea will always result in devoting fewer resources to other ideas. This is baked
into every choice you make, in business and in life.
But here is the thing: When you are seeking innovative ideas, what you want to focus on are
the opportunities. When you begin to analyze each opportunity, the risks will emerge. So
don’t pre-judge opportunities because there may be risk involved.
Why? As Carlos explains, analyzing opportunities creates an atmosphere of enthusiasm. And

without enthusiasm, nothing can be accomplished.
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1.35 Enthusiasm Works!
It’s not surprising that organizations gravitate toward enthusiastic workers and executives.
Enthusiasm lifts people. It has a way of motivating others - and motivating yourself.
In your career, you’ll find that enthusiasm will help you get ahead. It will propel you to
devote the necessary time and effort to your job, over and above what is expected of you. As
a result, you’ll have the possibility to earn more and get noticed for promotion.
On your job, enthusiasm frees you to come up with better ideas and complete projects in
more imaginative ways. You develop your personal creativity, which in turn helps you to
develop the way your organization achieves its goals. Your enthusiasm and creativity have
consequences - improving the work and the profile of your entire organization.
1.36 Turbo-Charging the Web TrendWatcher™
At this point, you have all the elements for productive Web TrendWatcher™ sessions:
• Enthusiastic Mastermind Group Alliance members,

• Who have become knowledgeable and interested in new knowledge, ideas and trends,
• Guided through the structured, step-by-step activities in the Web TrendWatcher™ tool.
You’ll be amazed at the creative, innovative possibilities for your organization!
1.37 After the Web TrendWatcher™

The Web TrendWatcher™ is your source for identifying the external trends impacting your
business and your ecosystem.
By the end of your Web TrendWatcher™ sessions, you will have the raw material to propel
your business to breakthrough growth.
But your ideas are not yet actionable. You need additional strategic tools to put those ideas
to optimal use - strategic tools you’ll find in Creative Leadership for Turbulent Times. For
example:
• Creating unique customer-value propositions for each of your products or services.

You’ll learn how in Module 2 of Creative Leadership in Turbulent Times.
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• Crafting new, powerful business models and competitive strategies. You’ll learn how
in Module 3.
• Exponentially increasing your profitable sales with the powerful tools and concepts in
Module 4.
• Continuously releasing new products and services with the process introduced in
Module 5.
• And continuously realigning your organization to keep it functioning optimally in the
face of hyper-turbulent change, using the process you’ll learn in Module 6.
Think of it this way: The Web TrendWatcher™ is only one tool in your arsenal - but a vital one.
It will help you to envision the innovative ideas you will need to springboard your organization
to an exciting future. And the other tools in your arsenal will show you how to turn your
innovative ideas into reality - a reality of breakthrough, profitable, sustainable growth.

At the start of this webinar, Jay Abraham explained that your primary job as a leader is to see
reality. And reality today is that change is happening faster than ever before.
What does this mean? For one thing, if you think that your business is standing still because it
is “stuck”, you are kidding yourself. In today’s highly-competitive environment, if your
business is not moving forward, it is actually falling behind. There is no such thing as
“standing still” anymore.
Which means your business has to change. You have to move outside of your comfort zone.
You have to open your thinking to new, innovative ideas.
Look around you today and you will see the relics of many failed businesses. Some of them
had been quite successful once - but like HP or Chrysler or Kodak, they reacted to the
changing environment by looking backwards. Instead of focusing on innovation, they clung to
the delusion that their customers would continue to want their old, outdated products.
Meanwhile, other organizations found a way to thrive. At the same time that HP and Chrysler
and Kodak were struggling, customers were flocking to buy iPads from Apple, fast fashion
from Zara, and tablet cases from DODOCase. The differentiator between these successful
companies and the old, failed models is one thing: The ability to quickly and continuously
innovate.

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The Web TrendWatcher™ puts all the tools into your hands to create an ongoing, sustainable
innovation process for your business. But ultimately, its success is up to you as a leader.
When new ideas are presented to you, do you welcome them, even if they are different from
what you expected? Or do you become defensive and abusive to your staff for daring to
present an original thought?
When you welcome new ideas, you create a climate in which your executives are eager to
share your ideas. But if you behave arrogantly, if you insist on reframing reality to fit your
personal preconceptions, you will kill innovation.
Unfortunately, many CEOs today are arrogant. But that creates a competitive advantage for
wise leaders, who are willing to face reality and create a culture of innovation.
Thanks! I hope you have enjoyed the webinar. If you have questions about the Web
TrendWatcher™, please let us know.
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Webinar 4:
Getting Salespeople Onboard with Laser Sales
1.1 Webinar Intro
(music)
1.2 Introduction
Welcome to the webinar. I’m Jay Abraham.
Today I want to talk to you about limits. Limits to what both you and your salespeople can
aspire to in life. Limits to the profits you can make, and the money your salespeople can earn.
Because I’m here to tell you, that most of the limits that are holding you and your
salespeople back are self-imposed.
Think about it. Why do certain people naturally gravitate to a sales career? Because in sales,
you can control your destiny. You get to dictate what is in your pay envelope - simply by
being better, more productive, more effective at your job. It’s a simple equation: The higher
your sales, the more you earn. Simple, right?
Okay, at this point, your salespeople will be muttering that it’s not really that simple. There
are too many factors outside of their control. They can’t sell more because your products are
priced too high, the discount program is too steep, the advertising budget is too low, the
leads you given them are sub-par, the economy is too bad, blah blah blah.
There’s a word for all of those issues. Excuses. These aren’t the reasons why your salespeople
aren’t selling more. These are just ways to avoid one terrible, frightening truth. And that is,
each individual salesperson actually does have a lot more control over his or her own destiny.
If they want to sell more, if they want to earn more - well, they have to figure out how to
change what they are doing and how they are doing it so they get better results, pure and
simple.
1.3 Getting Salespeople Onboard with Laser Sales
We can’t make people want to change. That has to come from inside of them.
But if they do want to change - if they want to remove the self-imposed limits, so they can
sell more and earn more -- we can show them how to do it. That’s what this webinar is about.
Now let me tell you ahead of time, this is not going to be touchy-feely. We won’t be singing
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Kumbaya or getting in touch with our inner warriors today. All that you will find here is a no-nonsense,
practical approach that your people can use right away. My approach - which is
based on Optimization: The Three Ways to Build Your Business, what my partner Carlos Dias
calls “Laser Sales,” has transformed sales careers and lives in every industry, in every size
business, in every corner of the globe. It’s worked in over 10,000 businesses, including Carlos’
clients’ businesses. So I’m very confident it will work in yours, as well.
The webinar will begin with a look at The Theory of Optimization-which we refer to in our
program as “Laser Sales”. In fact, you have already learned the 3 ways to grow a business in
Module 1- but we’ll prove to you here, logically and mathematically, how applying my theory
will exponentially increase your sales and profits. Also in this section, we’ll also show you the
34 different, specific strategies for implementing the theory - so you can pick the mix of
strategies that fits your situation and share them openly with your salespeople.
Next, we’ll focus in on one of those strategies - I’ve chosen one that fits just about any
industry or company -- so you can see the logic of exactly how it works - and how easily your
salespeople can implement this strategy for a quick, sure-fire sales boost.
Finally, you’ll get access to a powerful calculator tool to share with your salespeople. My
partner, Carlos, developed this calculator when he was a CEO of a multinational company, to
prove to his salespeople once and for all that there were really no limits for them - that they
could essentially write their own salaries, just by implementing the Theory of Optimization.
It’s pretty amazing -- they’ll be able to enter the sales goal they want to hit, and the
calculator will show them exactly what they have to do differently and continuously to
achieve that goal for themselves.
You’ll like what it can do for your business. This calculator, used in conjunction with the
appropriate strategy, allowed one sporting goods brand in Brazil to grow from $2 million to
$30 million in only 3 years.
In other words, this webinar is all about how to break through self-imposed limits -- and
achieve a better income and a better life, for you and for all your salespeople.
I hope you enjoy it. Here is our narrator, Scott Schmeer, to get you started.
1.4 Menu
1.5 Creating a No-Limits Future
This section will explain how to use Jay Abraham’s Theory of Optimization to create a nolimits
future for yourself and your business.
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1.6 Google It!
Jay Abraham’s Theory of Optimization says that there are only 3 ways to grow a business.
This seemingly simple theory has profound implications that have shaken up the way people
all over the world think about business strategy.
If you open Google and type in “Jay Abraham three ways to grow a business”, you’ll find over
half a million references to it around 738,000 in the US alone. But today’s webinar is unique -
because here you will find how Jay Abraham himself explains his theory - and how his partner
Carlos Dias applied the theory to grow a number of real-world businesses.

And best of all, we’ll share some tools so you can do the same for your business.
1.7 How Many Ways?
Jay’s Theory of Optimization states that there are only 3 ways to grow a business.
Are you surprised?
It may seem like there are a thousand different ways to do it.
But actually, when you boil it down, there are only these 3 possibilities.
• You can increase the number of your customers or clients.

• You can increase your average transaction value - the dollar amount of the average
• sale or order.
• Or, you can increase the frequency of repurchase -- the number of times the customer
keeps coming back.
1.8 How Many Ways to Grow a Business?
Let’s look at what happens when you increase the number of customers.
Say that you have 1,000 customers on your list.
If you figure out a way to grow that list by 10%, you have 1,100 customers.
If you grow the list by a third, your customer base is now 1, 333 customers.
And if each of those 1,333 customers is purchasing an average amount of product, you’ll have
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boosted your sales volume by 33%. Not bad!
Let’s say that instead you opt to increase your sales volume by increasing the average value
per sale. If your average current value is $100, look at what happens when you boost your
average sale by 10% -- or by 25%. If you multiply that across 1,000 customers, you can see
that focusing on increasing the average value can seriously increase your total sales revenue.
But instead, let’s say that you decide to focus on increasing the frequency of repurchase. If
you increase frequency by 10%, your average frequency increases to 2.2. If you increase
frequency by 50%, your average frequency shoots up to 3. Multiply that across 1,000
customers, and again, you’ll make good headway on increasing your overall sales volume.
1.9 Theory of Optimization
Now look what happens when you Jay Abraham’s Theory of Optimization works its magic.
Optimization means utilizing - and taking full advantage of - the 3 ways to grow your business.
If you improve a little in any one of the 3 ways, your sales volume will improve a little. But if
you improve dramatically in all 3 ways - well, multiply across the rows on your screen and
check out the numbers for yourself.
Look what happens! When you focus on all 3 ways -the results are exponential.
This illustrates how you can harness the power of geometry to optimize your sales volume -
and your profits. Isn’t this smarter than the strategy you’re presently following?
1.10 Cases in Optimization
Now that you’ve seen the math, are you wondering if the Theory of Optimization works in the
real world?
Here are some examples of real-world companies that achieved startling results - and
achieved them quickly.
Pony - an older-world athletic footwear brand - used the Theory of Optimization to boost
their sales from $2 million to $25 million in just two years.
A European group with multiple brands saw their Argentinian subsidiary sales shoot to $7.5
million in just 1 year.
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And the Toyota distributor in one Latin American country, in just 4 years, optimized their
sales to the tune of $270 million in only 4 years.
The Theory of Optimization has been applied successfully in company after company, sales
territory after sales territory - and it will work in yours, too! The same math applies, every
single time.
1.11 How Do I?
Okay, let’s say that you decide to use the Theory of Optimization, and capture the
multiplication effect of the three ways to grow your business.
Are you wondering how exactly to apply the Theory?
1.12 Optimization Tactics
Here are 3 lists of strategies for each of the 3 ways to grow your business.
Click on each box to view it.
1.13 Optimizing Your Sales

As you just saw, there are lots of strategies for optimizing your sales. Did you see some that
you could apply to your business?
Try a little pen and paper exercise. Jot down one or two strategies from each list that you
would be able to implement fairly quickly. Note the percentage or dollar increase in sales
that you think each strategy would create. Then do the math.
Remember, you don’t have to do all of the items on the list. All you have to do is select just
one or two strategies from each list. Then sit back and enjoy the multiplier effect to your
sales revenue.
Take time to actually do this exercise. What you are doing is shifting your paradigm. Just by
thinking in terms of the 3 ways to grow your business, and incorporating simple strategic
adjustments and improvements to what you are already doing, you will multiply your success
exponentially!
1.14 A Word of Caution
At this point, your head should be full of possible approaches for increasing your sales.
But before you get too excited, a word of caution.

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As you learned in Creative Leadership for Turbulent Times, everything in your business is
connected. If you decide to implement every one of the 34 strategies for every one of your
products and services, selling to everyone of your possible market segments across all of your
possible distribution outlets, you will certainly increase your sales. In fact, you are likely to
increase them so much that you will outpace your organization’s ability to fill the orders -
which in turn will impact your inventory requirements - which will in turn impact your cash
flow requirements and production levels and so on and so on. Worse yet, you may find
yourself increasing most in product lines that return the lowest profits - which could force you
to lose focus and neglect products that have higher profit potential.
So, as a leader, be sure you are operating with a clear strategy. Be sure you know who your
clients are - and perhaps even more important, know who they are not. Target your market
segments. Structure the most effective and profitable product mix for that segment, and
align the availability date for each product in the mix.
Don’t forget to factor some of the tools that you learned in Module 1 into your thinking. For
example, go back and review the Strategic Backbone posters, and the tool for increasing your
effectiveness by up to 16 times. Imagine for a moment what your sales and profits could be, if
you applied only those two of all the tools in your arsenal from Module 1.
In other words, think it through. Because the Theory of Optimization is so powerful that it can
be dangerous. You want the math to be on your side -- not to overwhelm you.
1.15 Summary
1.16 Using the Theory of Optimization
In this section you will zoom in for a close-up look at how to use the Theory of Optimization
within your overall strategic framework.
1.17 Part of Your Strategic Framework

In the first section of this webinar, you learned that it was important to implement the
Theory of Optimization as part of your overall, clear strategic framework. That way, you can
put your resources to work in a way that will optimize your highest profit-potential products
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and services.
1.18 Today's Focus
Here is one area that should be part of every organization’s strategy - by it is almost
universally neglected.
It’s the issue of reducing attrition.
1.19 The Quality of Leads
It all goes back to Sales 101.
Every sale starts with a lead - a potential customer.
But some leads are better than others.
Some leads are “suspects”. You could define a suspect as anyone who maybe, someday, could
possibly have a need for your product that is strong enough to make them want to buy from
you. And possibly, when they feel that need, they will also have the financial wherewithal
and decision-making power to make the purchase.
Other leads are “prospects”. They know they have a problem that can benefit from your
product or service. They are able to pay for the product, and they can make the buying
decision happen.
If you are a salesperson, which of these leads do you want on your list? Obviously, your
percentage of success is going to be poor if your leads are all suspects. Your sell cycle will be
longer, and often will lead to a dead end.
By contrast, prospects are prime, qualified targets for what you offer. You are almost
guaranteed a high batting average if your leads are all prospects.
1.20 Prospecting Where the Gold Is

If you ask a prospector how to fine gold, he’ll tell you, “You need to go where the gold is.”
In other words, once he finds gold in an area, he keeps going back there, time and again -
because he knows his success rate will be higher there.
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It’s true in business too. Every business has its own gold mine - its customer list. Each and
every one of them was a qualified prospect, who then was converted into a customer - and
will potentially buy from you again and again.
But here is the funny thing - there is another gold mine of prospects that is buried just
beneath the surface, that most organizations miss altogether. It’s your list of former
customers. As you can see on the screen, former customers are those who have not purchased
from you for 1 or more years.
1.21 About Former Customers
Former customers used to buy from you, but they stopped.

Why? Because of one or more of issues:
-Maybe because they no longer need your product or service. For example, say that you had
been supplying document shredding services to your client - but now the client has switched
to a completely paperless office - so there is no longer a need for shredding.
-Maybe because they had an unsatisfactory experience with your organization. Using our
shredding service example, maybe they found partially-shredded documents lying around in
their parking lot after your shredding trucks had been by. Or maybe they had a problem with
your billing department, that could not be resolved after repeated calls. Whatever the reason,
somehow they reached a tipping point and decided to terminate the relationship.
-Or, maybe because something changed in the customer’s organization that caused them to
interrupt the relationship. For example, maybe they decided to cut costs by shredding
documents using their office shredders, or maybe they brought in a new office administrator
who didn’t renew because she was not even aware that there was a shredding service in place.
1.22 What's Your Attrition Rate?
Every business experiences a certain amount of attrition. As you learned in Creative

Leadership for Turbulent Times, there are a number of reasons why you need to know your
business’ Attrition Rate.
Let’s say that you have 1000 clients. And let’s say that you have a 20% Attrition Rate. In other
words, you have been losing 200 clients per year.
If you cut your Attrition Rate in half, that’s like adding 100 new clients every year, isn’t it?
In fact, here is a powerful thought to contemplate. If you cut your Attrition Rate in half, and
change nothing else, you will double your business in just 10 years!
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That’s exciting! And it’s an easy little shift - because your former clients tend to be prospects
rather than suspects. These are the kinds of leads that your salespeople are looking for!
1.23 Optimizing Your Attrition Rate
So let’s apply the Theory of Optimization and look for 3 ways to grow your business by
reducing the Attrition Rate:
Under “Increase the Number of Clients”, there is a strategy that is so obvious, but amazingly
few businesses do this.
You can contact your inactive clients. Find out if they had a problem with you, or if they had
an internal change that caused them to stop doing business with you unintentionally.
You might also emphasize “Delivering higher-than-expected levels of service” to these clients.
If you talk to them and come to understand what their problems were with your service,
often it is relatively easy to offer them a slightly different service package that would meet
their needs better. If you have value-mapped your product line - as we show you in Module 4
of Creative Leadership for Turbulent Times - you can then even “Upsell or cross-sell” these
clients, which is a strategy listed under “Increase the average transaction value”.
Finally, under “Increase the frequency of purchase”, you should work toward communicating
more frequently to nurture these client relationships. Again, this is a simple concept, but a
powerful one that is not emphasized enough in most businesses.
Remember, using any of these strategies will help you incrementally. To optimize your
windfall from reactivating your clients, you will want to implement strategies from each of
the 3 ways to grow your business.
1.24 Summary
1.25 Strategic Salesperson Calculator

This section explains how to use the Strategic Salesperson Calculator to break through selflimiting
habits, so your salespeople can control their personal financial futures.
1.26 Paul's Problem

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Here is a typical sales professional. Rather than use his real name, will call him Paul.
Paul is eager and hardworking. He shows up with a positive attitude every day. He does his
homework and he puts in long hours. Paul feels like he is getting better at this job with each
passing year. And his sales figures have improved a few percentage points each year, in spite
of an economic downturn.
But Paul is frustrated. He feels he should be earning a significantly higher income - there are
certainly many things he would like to do with the additional money - but he cannot see a
way to boost his sales enough to reach that goal. His colleagues in other organizations tell
him that the situation is about the same in their shops, too.
So Paul tells himself, this is a lousy time to be in sales. In today’s economy, there is a limit to
how high I can set my sales and income goals.
Does Paul’s belief set sound familiar? Sadly, many salespeople around the world share his
frustration.
But it doesn’t have to be that way.
1.27 A Common Pattern
In his years as a CEO, and later as a consultant and mentor to global businesses, Carlos Dias
has counseled many people like Paul. He recognized a common pattern from his talks with
experienced sales professionals, no matter what industry they were in. Almost always, the
salespeople told him that they chose sales because they wanted to be able to control their
income. They liked the idea that, the more they sold, the higher their pay.
But sadly, those same salespeople complained that they were somewhat disappointed in their
chosen career. It turned out that there were too many factors in the sales process that were
outside of a salesperson’s control. So, no matter how hard they tried or how experienced
they were in sales, there turned out to be an upward limit to the income opportunities in
sales.
1.28 Laser Sales
Carlos’ response was, “The limits are in your head.” Your problem is not that you cannot sell
more. Your problem is in the way you are approaching sales. If you think about your job
differently - and adjust what you are doing to be more strategic - you can exponentially
improve your sales.
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Carlos’ approach is called Laser Sales - and it is based on Jay Abraham’s Theory of
Optimization. Carlos has taught Laser Sales to countless salespeople around the world -
salespeople who used to turbo-charge their income potential.
Here’s how it works.
To understand Laser Sales, you need to understand the Strategic Salesperson Calculator.
Carlos created this tool to let salespeople essentially write their own salary - and then show
them what they need to do to achieve that income.
Let’s step through it, using numbers from our friend Paul.
At the top of the calculator, Paul enters his sales goal - the Forecasted Annual Sales for the
current year. This year, he forecasts $400,000 in sales.
Next, the calculator needs to know how much time Paul devotes to sales. After vacation and
holidays, he expects to work 44 weeks. And, although he actually puts in 6 days a week, 1 of
those days he devotes just to paperwork. That leaves 5 days a week for selling - so he enters
the number 5. Right away, Paul gets some interesting feedback. The calculator tells Paul that
he will need to work 220 days this year - and sell $1,818 per day - in order to achieve his
forecast.
Next, Paul enters the Number of Calls that it typically takes him to set up a sales
appointment. This varies from one sales position to the another, and it’s important to know.
Paul estimates that it takes about 5 phone calls or preliminary visits just to get the
appointment with an actual buyer. Once Paul has an appointment, he estimates that it takes
him 5 sales visits to actually close the sale. Using those figures, the calculator shows him that
he is working at a 20% Efficiency Rate and also a 20% Effectiveness Rate, using his current
approach. We’ll come back to talk about the significance of these values later. For now, let’s
move on.
Next, Paul enters the amount of his Average Sale - which he estimates at $20,000.
The calculator displays some values that Paul really hadn’t realized before. To reach his
current sales forecast of $400,000, Paul has to make 20 average-sized sales. Based on his
Effectiveness Rate of 20%, it will take him 100 sales visits to sell that much. And based on his
Efficiency Rate, he will need to make 500 calls to set up sales appointments. That translates
to 11 calls per week, or 2.27 calls per day. That’s pretty reasonable.
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At this point, Paul has - perhaps for the first time -- a good understanding of how much time
and effort it will take him to reach his current forecasted sales.
But Paul is ambitious, and he would like to make a significantly higher income. He wonders,
“What would happen if I attempted to reach a much higher sales goal?”
Paul changes the Forecasted Annual Sales figure to $1 million. To reach that forecast, the
calculator shows that he would have to make 1,250 calls to set an appointment, make 250
presentations, and close 50 sales. Paul may be ambitious, but he is a realist - and those
numbers do not sound possible.
What are Paul’s available options? Some salespeople, in our experience, might get
discouraged and abandon the calculator at this point. But, Paul is committed to becoming the
best salesman in his organization, and he is ready to take time to learn new tools.
1.31 Where Are the Magic Bullets?

Does that mean that Paul has to give up on his new goal?
Not necessarily. Not if Paul can figure out a way to work smarter. That’s where the Efficiency
and Effectiveness Rates come into play.
The Efficiency Rate is related to how long it takes you to set up an appointment. The
Effectiveness Rate is related to how long it takes to actually close a sale.
Let’s see what happens if Paul can find a way to improve his Efficiency and Effectiveness
Rates. Right now, with a 20% efficiency rate, Paul needs to make 1250 calls a year to meet his
new goal. So let’s say that Paul finds a magic bullet that allows him to set appointments in
just 2 calls. That would bring his Efficiency Rate to 50% -- and it would mean he would only
have to make 500 appointment-setting calls this year. That’s much more doable.
On the effectiveness side, right now Paul has a 20% Effectiveness Rate, which means he has to
make 5 visits for every sale, for a total of 250 sales visits to reach his goal. But let’s say that
Paul’s magic bullet allows him to reduce the number of required visits to 3. That brings his
required number of sales visits down to 150 per year. It’s still ambitious - but it is achievable.
Paul also notices another area on the calculator where a magic bullet would help. If he
figures out a way to raise his Average Sale to $25,000, he can reduce the number of calls and
visits even more - and still get within reach of his $1 million sales goal.
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1.32 Improving Efficiency and Effectiveness
Let’s talk about magic bullets. What kind of magic bullets can Paul use to improve his
Efficiency and Effectiveness Rates?
In this case, they are Laser Sales bullets, and they are based on the Theory of Optimization.
Remember, the Theory of Optimization says there are only 3 ways to grow your business. If a
salesperson adopts a strategy from one of these ways, and really works at it, he or she will
increase sales - but only incrementally. To increase sales significantly - exponentially - a
salesperson needs to adopt a strategy from each one of the 3 ways - and then watch the
multiplication effect turbocharge their sales.
1.33 Creating a Laser Sales Strategy
So let’s say that you are sitting down with Paul, coaching and working out with him a viable a
Laser Sales strategy for his territory.
You begin with the list of strategies for increasing the number of Paul’s clients. Together, you
determine that you have lost a large number of clients to attrition in Paul’s territory - so
“Contacting inactive clients” seems like a good strategy. Paul already has good leads and
contact information for inactive clients, which means he can shorten the time it will take to
set up appointments and close sales for these clients - so this will definitely help Paul’s
Efficiency and Effectiveness Rates.
“Improving his sales skills” is another good option from this list. Efficiency and effectiveness
are directly tied to sales skills. If you ever wanted a way to motivate Paul to improve his skills,
this Strategic Salesperson Calculator should help you to focus his attention on the issue.
1.34 Calculator
Together, you and Paul turn your attention to the strategy lists for the other 2 ways to grow a
business.
From the “How to increase your average transaction” list, you select “Up-selling and crossselling”.
From the “How to increase the frequency of purchase” list, you select “Building a relationship
by communicating with client.”
1.35 Magic Bullets?

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At this point, Paul is getting very excited about his Laser Sales approach! Here’s why.
On the Strategic Salesperson calculator, he can see that he has found those magic bullets.
Paul expects that the strategies he has selected will reduce the Number of Calls he will need
to set up an appointment to 2, and the Number of Visits required to 3. And he also anticipates
that he can boost his average transaction to $25,000. When he enters these new values into
the Strategic Salesperson Calculator, he sees the direct impact of Laser Sales. By finding
strategies to boost his Efficiency and Effectiveness Rate to 50 percent and his 33 percent
respectively, and increase his average transaction value - Paul’s ambitious new sales goal -
and the income that goes with it - have become achievable.
1.36 Calculator
Here is a link to the Strategic Salesperson Calculator, to share with your salespeople. Take it
for a spin. Try different scenarios, and see what their impact will be.
Your salespeople may also be interested in the area toward the bottom of the calculator,
which they can use to plan out the number of monthly calls and visits they will need to make
to achieve their sales forecasts.
1.37 A Word of Caution

One word of caution.
Remember to align your salespeople with the clear strategic framework you have chosen for
each of your products. This is your job as a leader, just as it is Paul’s job to be a creative
strategic salesman.
Once your salespeople are aligned with the strategic framework you have chosen, they will be
able to use Laser Sales and the Strategic Salesperson Calculator to increase their sales - while
at the same time increasing the overall profitability of your organization.
1.38 Summary
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1.39 Final Thoughts From Carlos
Hello. I’m Carlos Dias.
Today’s webinar was about how to break free of self-imposed limits.
We showed you how to get your business “unstuck”, and exponentially grow your profits, by
using the Theory of Optimization or the three ways to grow your business.
And we showed you how to get your salespeople “unstuck” and excited about their careers
again, by using our proprietary calculator and a Laser Sales approach to achieve new levels of
sales and income success.
By the way, there is much, much more on related topics in upcoming Modules of Creative
Leadership for Turbulent Times.
-In Module 2, Creating and Delivering a Unique Value Proposition, you’ll learn how to use Jay
Abraham’s proven, revolutionary concept called the Strategy of Preeminence to make your
business ecosystem run at a maximum speed and create sustainable profitable growth for your
organization. Jay’s concepts are so exciting, it’s like reprogramming your DNA to want and
succeed in reaching greatness.
-And, if you would like to learn more about how to create an effective strategic framework
for your sales and marketing efforts, I invite you to pay particular attention to Module 4,
where our topic will be Developing, Implementing and Evaluating Sales and Marketing
Strategies.
Thank you for watching the webinar! I hope you have enjoyed it! If you have questions about
what you learned today, please let us know.
Webinar 5:
How to Hack a Cause-and-Effect Diagram
1.1 Webinar Intro
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(music)
1.2 Introduction
Welcome to the webinar. I’m Carlos Dias.
As a leader, your most urgent responsibility must be rooted in your ability to see reality - the
challenges that your organization faces rather than wishful thinking - and to share that reality
with other key stakeholders in your business.
Why is seeing reality so crucial for success in turbulent times? I find so often, working with
senior executives around the world, that leaders who are in trouble are the ones who are slow
to update their mental models. For them, shifting their paradigms is a struggle, either
because they don’t know how, or they are unwilling to leave their comfort zones.
What happens to leaders who do not update their mental maps? Sadly, their understanding of
the world becomes corrupted. So they continue to act on the assumption that certain
outcomes will occur. And time after time, they are stunned when things do not go as planned.
1.3 Introduction
It’s a serious problem, particularly in a time of hyper-turbulent change. So it’s important to

take a moment to consider, how does a leader’s mental map become corrupted?
It results from reversing the causal process of understanding.
We should be looking at the world, drawing conclusions from what we see, and updating our
mental maps as a result. That’s a paradigm shift.
Instead, we look only at what we wish were happening - or perhaps we find a report in the
media that coincides with our wishful thinking. If we redraw our mental maps based on
wishful thinking, what consequence should we expect? Inevitably, our map isn’t going to
reflect current reality, is it?
And that is a huge problem because you are responsible for your own fate, and that of your
organization. In other words, if you screw it up, no one else is going to bail you and your
organization out.
1.4 Seeing Reality

Seeing reality - as opposed to wishful thinking -- is no easy task, and here’s why: Our brains
are inherently lazy. It’s human nature to grab onto what is familiar and obvious - and assume
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that you are seeing the whole picture. But that’s a dangerous habit in turbulent times.
Because these days, you can’t afford to accept something as true without having proof. These
days, there are new dangers and new opportunities lurking below the surface. Somehow, you
need a way break free of old assumptions based on obsolete paradigms so you can look again,
look harder this time, look from multiple perspectives - in order to reveal the full reality that
you face. That is what you are paid for!
1.5 The Power of the Fishbone
In Creative Leadership for Turbulent Times, Jay Abraham and I will show you a variety of
proven techniques for seeing reality more clearly.
In today’s webinar, I want to focus on how to use a familiar problem-solving tool - the
Fishbone Diagram - to expose multiple causes for a problem, and reveal causal relationships
you may have missed before.
By the way, the techniques we will demonstrate today are particularly effective when used in
a Mastermind Group. Your Mastermind group will help you view problem causes and effects
from multiple perspectives, so you can be sure you are getting the full picture.
Here is Scott Schmeer to tell you more.
1.6 Menu
1.7 About the Fishbone
In this section, you will learn what a fishbone diagram is and why it is ssed.
1.8 What Do You Call this Diagram?

Chances are, you’ve seen this type of tool before. Some people call it a cause-and-effect
diagram, because its purpose is to identify and organize what is causing a particular effect or
problem.
Some people call this a fishbone diagram, because it looks like the skeleton of a fish.
It is also called an Ishikawa diagram, in honor of Kaoru Ishikawa, the man who developed the
tool.
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1.9 Parts of the Diagram
Let’s take a closer look at the parts of the diagram.
This is the “head,” where you will specify the precise problem or effect that you are
investigating.
The long central arrow represents the “spine”. All of the possible causes of the problem will
be organized along the spine.
These are known as the “large bones.” Each large bone represents a category of potential
causes. The name of each category is written at the end of its large bone.
The causes or sub-causes in each category are found here, in the “small bones”. Each small
bone represents a single, specific possible cause or subcause.
The arrow-heads on the large and small bones help you to clearly see causal relationships on
the diagram. Items on the small bones contribute to causing the listing on one of the large
bones. Items on the large bones contribute to causing the problem.
1.10 Why Use It?

Why use this tool?
The fishbone diagram is a powerful tool to help you clarify your thinking about the causes of a
problem. The process of creating the diagram pushes you to identify multiple causes, rather
than settling for the first idea that comes to mind. The diagram’s structured visual display
helps you to differentiate between causes and effects - and exposes causal relationships that
you might have missed otherwise.
Once you have completed the diagram, you’ll be able to use it within your Mastermind Group
to help you isolate which factors require further verification, and what the logical next steps
might be.
You’ll also find that the completed diagram is a great communication tool - making it easy to
share your thought process and findings with other executives or even your Board.
1.11 Summary
Here is a quick summary of this section.
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Please click Next to return to the menu.
1.12 Hacking the Fishbone Diagram
In this section, you will learn how to use the fishbone diagram tool to think multidimensionally
about a problem in your business.
1.13 What You Will Need
Before you get started, it’s important to assemble the right equipment.
During the analysis process itself, you will need a large writing surface, like a flipchart. You’ll
also need some markers, as well as plenty of self-stick notes.
Later, but only after you and your Mastermind Group have completed your analysis, you can
transcribe your findings onto an online electronic poster which can be projected onto the wall
and shared by all of the group members.
1.14 Step 1: Identify the Problem
To conduct the analysis, begin by identifying a specific problem or effect that you wish to
study.
With your Mastermind Group, discuss the problem statement. Allow the group to ask questions
or suggest different wording, in order to clarify the problem. Take your time with this, to
make sure you are focusing as precisely as possible on the correct problem.
When the group agrees, write your problem statement in the “head” of the fishbone.
1.15 Step #2: List Possible Causes

Next, identify possible causes. In a Mastermind Group session, this will be fairly easy, as each
group member will be familiar with some aspect of the problem.
Give a package of sticky notes to each Mastermind Group member, and ask each group
member to jot down all of the causes they can think of. At this point, they should be working
independently, without worrying about what other group members are writing. The more
causes they come up with, the better. The only rule here is, make sure they write only one
cause per sticky note.
Here is a common question about this step:
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What if more than 1 group member has the same idea?
The answer is, that’s fine. Focus on encouraging as many ideas as possible. Don’t worry about
duplicates, they will be dealt with in a later step.
Here is another common question:
What if some of the ideas seem strange or irrelevant?
Again, the answer is to encourage lots of ideas at this point. An idea that seems like an
outlier in this step may end up spurring the group to look at the problem in novel ways during
a later step in the process.
So the bottom line for this step is, welcome all ideas - the more the better. Collect all of the
sticky notes, and move on to Step 3.
1.16 Step #3: Sort into Clusters
Now it’s time to sort through the sticky notes and group them into clusters of related causes.
To do this,
• Read each note out loud to the group.

• If necessary, clarify the wording on the sticky note. It’s important for your phrases and
words to clearly reflect the group’s thinking at this time. You don’t want someone to
come back to this later and misinterpret what the group intended to say. Carlos alerts
us: this happens all too frequently in the business world. So take the time here to be
thorough and precise.
• When you are ready to move on, look for duplicates and get rid of them.
• Now, as a group, begin to sort the causes into clusters that seem to be related.
• During the sorting process, new ideas often arise. Capture them - one per sticky note -
and add them to the appropriate clusters.
• Keep working on this until everyone agrees with your clusters. Once you have
agreement, move on to the next step.
1.17 Step #4: Label the "Large Bones"

At this point, you are ready to label the large bones. Once again, this is a group activity.
• Work on one cluster at a time.
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• Discuss what the notes in that cluster have in common.

• Based on your discussion, find words that reflect the common attribute in that cluster.
Use those words to label one of the “large bones”.
• Now move on to the next cluster, and repeat the process. Keep going until you have
labeled all of the “large bones” on your diagram.
• Before you move on, review the clusters with the group. Make sure everyone agrees
with the labels on the “large bones”.
Here is an example of a fishbone diagram with labels on the large bones.
1.18 Step #5: Fill in the "Small Bones"

The next step is to develop the small bones.
Begin by selecting one of the large bones. Ask the group, “What might cause this to happen?”
Some of the answers will already be in your cluster. But as the cluster begins to take shape,
new ideas will occur to people. Just write each one on a new sticky note.
Arrange the sticky notes along the cluster. Use the diagram to show relationships between
causes and sub-causes.
Keep on asking, “What might cause this?”, until all the ideas have been placed on the
fishbone.
When you have completed one cluster, move on to the next, until you have completed the
diagram.
Before we move on, here is a common question about this step: What happens if a “cause”
seems to belong in more than 1 place on the diagram? If that happens, make multiple copies
of the sticky note, and paste each copy in the appropriate cluster.
1.19 Filling in the Fishbone
At this point, your fishbone diagram will look something like this. It may look finished - but
don’t be fooled. There is still another important step to complete.
1.20 Step #6: Prioritize and Verify
Remember that the items on your fishbone diagram are merely “possible” causes of the
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problem. To make your findings actionable, you will need to select the most likely causes and
study them further.
Begin by reviewing all of the causes and loosely prioritizing them. Discard or cross out
irrelevant causes. Circle or star the 3 most important contributors to the problem. Then,
narrow down your list to the single most important contributing factor.
Transfer your work onto an electronic poster or flipchart, so you have a clear record of your
Mastermind Group findings. Be sure to add a title, date, and contact person, in case anyone
needs to get in touch later with questions.
If you are using electronic posters, make a copy for everyone in your Mastermind Group. If
you are using a flip chart, post it where the group members can refer back to it easily.
1.21 Completed Fishbone Diagram

Here is a completed fishbone diagram. It clearly lays out the problem being studied, the
potential causes of the problem and how they are interrelated, which actions were selected
for further study, and who created the diagram.
1.22 Summary
Here is a quick summary of the steps to take to “hack” a cause-and-effect diagram in order to
identify multiple possible causes of a problem, understand the causal relationships among the
causes, and prioritize which causes require further study.
When you are ready, click Next to return to the menu.
1.23 Using Your Results
Once you have completed your fishbone diagram, how will you use your findings?
1.24 Using Your Diagram
There are a variety of ways to use your completed diagram.

You can use it as an action planner, to help you decide which causes to study and what type
of data would be most helpful in verifying your 3 key causes.
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You can use it as a way to document which causes have been verified and which still require
action.
You can use it to review your overall list of causes and revisit how they are interrelated.
One of the most important ways to use the diagram is as a communication vehicle. The visual
nature of the fishbone showcases the big picture for your audience, so they can follow your
thought processes and see causal relationships - but without feeling overwhelmed by too
much detail.
1.28 Summary
Here is a summary of ways to use the fishbone diagram tool.
When you are ready, click Next to return to the menu.
1.29 Final Thoughts from Jay
Hi, Jay Abraham here.
If you are familiar with my work, you know that I’m never satisfied with accepting the status
quo. I believe with all my heart that we can improve just about any situation - if we allow
ourselves to.
When people fail, it’s usually because they handcuff themselves. Without even realizing it,
they chain themselves to wrong or outdated assumptions about what is actually causing their
problems. Is it any wonder that their solutions don’t work - no matter how hard they try?
That’s why a simple tool like the cause-and-effect diagram can be so powerful for you. The
cause-and-effect diagram helps you unchain yourself from old assumptions, gets you thinking
divergently about the problems that have been holding you back - and frees you to find
innovative solutions that will springboard your business to a successful future.
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The cause-and-effect diagram is also quite flexible. It fits perfectly in the structured
strategic-thinking exercises in our program - as you will see as you work through the modules
of Creative Leadership for Turbulent Times. And once you get comfortable using this tool, I
know you’ll find yourself plugging it into many of your day-to-day leadership activities as well.
Thanks for your time today. If you have questions or comments for Carlos or myself, please
let us know. To exit the webinar, just close your browser window.
U Jay Abraham’s Philosophical Emails
U My Wish For You: Never Give In, Never Give Up!

(Originally sent on January 4th 2012)
So, ok... 2012 is here. What--if anything, are you... will you be doing differently this year (than last year),
to propel your business to more success, achievement and greatness?
If you have a great answer, then--stop reading. If NOT, here are some thoughts to---maybe inspire you
to seek more breakthrough thinking in the areas of marketing, strategy, innovation and self-
management.
Winston Churchill is famed for delivering the shortest commencement speech ever recorded in college
history:
"Never give in. Never, never, never--in nothing great or small, large or petty--never give in, except to
convictions of honor and good sense.Never yield to force. Never yield to the apparently overwhelming
might of the enemy. "
What's the implication? Well (I think) there are many. If you're small and struggling---take a deep
breath, draw in your second wind, dust yourself off and jump back into the ring -but fighting not against
mere competition.
Rather, fight against mediocrity and commoditization--by making yourself and your business unique,
desirable, valuable--far more valuable than your competition can possibly equal.
How? Don't allow us to be mere intellectual entertainment. Make my resources your propellant towards
greater achievement.
Focus on your marketplace, not on your own self interests.
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In everything you do online or off--sell leadership. Demonstrate to people that you feel their pain or
hopes or dreams or fears or needs. Don't patronize or pander. Definitely don't self-serve! Provide people
with ideas, advice information that have (and hold) true value or entertainment or purpose for THEM--
not you.
Make your market, your client, your prospect, your recipient of whatever communication you're
sending--make THEM the center of attention. It's not about you. It's all about them.
This may sound awkward--but--most people fall in love with their product, service, company or industry.
Try--instead--falling in love with the people you serve, the people you're communicating and connecting
with.
Show people that THEY matter. Their lives, their interests and their situation truly matters to you and
your business.
In life and in business, we are rewarded in direct proportion to the value, contribution and benefit we
bring to others. Conduct a quick reality check. Do you bring meaningful value to others--in what your
business does, certainly.
But do your communications, conversations, interactions, all bring people value?
Are they (and you) authentic, purposeful? Remember that the entire concept of value, benefit and
contribution are all--totally subjective. What YOU think may be appealing, exciting, worthwhile--your
market may find worthless. So let THEM always decide with their response, their sharing, their positive--
or negative feedback.
Always stop and ask yourself, your team, your marketing--do they and what you are doing and saying--
really add value?
I was reading a staggering article from legendary business guru--Peter Drucker over the holidays. It
focused on the misperception most people have about entrepreneurs.
Drucker says most small business owners are NOT entrepreneurs. They are merely proprietors--who add
no true value to the world other than perhaps diverting some of the commerce that their industry would
normally generate over to themselves.
Stated differently, the vast majority of businesses are mere commodities, marginalized, non-
distinguishable vendors of stuff--providing nothing unique, nothing superior, no greater experience, no
distinctive benefit or advantage to the consumer.
True entrepreneurs--on the other hand strive to create something new or better for their marketplace in
what they do. They create true value for the consumer. They engineer it or execute it...or present it...or
purvey it differently than the maddening crowd of generic competitors do.
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In small or larger ways, true entrepreneurs are the driving forces of positive upheaval in their industries,
markets and business worlds.
They have passion, purpose--a keen sense of possibility. They are anything but ambivalent. They are
anything but apathetic. True entrepreneurs love change. They live for the opportunity to flex their
cerebral, creative juices.
Mere business proprietors are in it only for an income. All they do is what has been done and is being
done before them a thousand or a million times, over. It's almost a job. But true entrepreneurs--true
entrepreneurs create new satisfaction, new demand, new experiences, new levels of dimension and
possibility to (and through) whatever they do.
So here we are--at the forefront of the New Year, contemplating our fates, our futures. My question to
YOU is this: are you content with mediocrity? Or are you game to create something (or some things)
new, something different, something better for your market?
Do you have the willingness to transform your business and relationship with your market? Can
you...will you transmute values (as Drucker says). Will your marketing/selling strategy trigger a positive
upheaval that will transform the way your marketplace sees you, connects with you, relates to you,
respects you, remains loyal and a fan of you?
Some final points to consider as we begin our 2012 adventure into marketing down the path of being
preeminent.
True entrepreneurs relish the chance to surmount obstacles that their other competitors find daunting.
An enterprise that does NOT commit itself to constantly innovate inevitably ages, dries up and declines,
then dies.
INNOVATION, by the way does NOT necessarily refer to anything high tech--though it can be done that
way.
It merely refers to anything tangible or intangible that brings greater value, benefit, contribution,
advantage, enjoyment, understanding, protection or enrichment to a marketplace. That gives you an
enormous array of ways to become an agent of change, a creator of value--through your marketing
strategy and actions.
Finally--you must be willing to perceive change as an opportunity, not a threat! Stop holding onto what
already exists. Breakthroughs only occur when you are pursuing something better. Drucker says true
entrepreneurs are awash with "rerumnovarumcupidus." That's Latin for being "greedy for new things."
One more point. It's important: entrepreneurship, innovation, breakthrough thinking---none of it comes
automatically.
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It's not necessarily natural. And YES, it is work to accomplish that which your herd-based competitors
won't/don't. But the rarified satisfaction and fulfillment that comes with wanting to innovate, reaching
for innovation--for the benefit of your marketplace, working for it---is unimaginably rewarding. Happy
New Year!
Jay
P.S. More to come on Entrepreneur vs. Proprietor.
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The Real Meaning of Business Life in 2012
NOTE: More on becoming a "Born-Again" entrepreneur...It's long, but sells NOTHING!
Can we talk candidly for a few minutes? This could alter/redefine your business future. But it may be
painful to hear.
The New Year that's upon us could...possibly...be THE toughest, most challenging, stress-inducing,
mentally buffeting year you've ever lived in your business.
Why? The reasons are many. But the point I want to make is NOT how competitive the marketplace is
becoming. It's NOT how different consumer buying patterns are changing. It's NOT even a lecture about
anything I teach, like the Strategy of Preeminence or the Nine Drivers of Geometric Growth.
No - there's only one vital/critical/pivotal realization I want you to make as we start the clock ticking
loudly away on this year of dramatic volatility we're calling 2012.
As a business owner - you're either a proprietor or an entrepreneur. Tragically, shockingly, but truthfully
- something like 95% of all small business owners function as proprietors - not entrepreneurs.
Why is this fact so bad? Because your days as a proprietor - operating a "me too," commodity-type
enterprise are all but numbered. Stated less tactfully - unless you dramatically change who and what
you are - your business could become "The Walking Dead" - possibly sooner than later.
I'm not even trying to scare you.
I'm writing this "red alert" to save you, pressure you, reset your belief system. I'm not doing this to sell
you a thing - except, hopefully (if the shoe fits) to sell you on shifting yourself out of the doomed world
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of business proprietor and into the dynamic, vibrant, possibility-based world of an entrepreneurship.
An example is appropriate.
So, as I examined my own goals for 2012, I realized that I ONLY wanted to work with true entrepreneurs
--- as opposed to business owners who function more as proprietors. Wondering what's the difference?
It's huge.
A proprietor (as described by Peter Drucker) is a business owner who pretty much adds nothing
meaningful to the business category they address.
A Mexican restaurant or a deli that does pretty much the same thing much the same way every other
one does it---adds little (if any) real value to the marketplace - other than (maybe) convenience of
location.
Certainly the owner is banking on the market expanding to embrace his or her offerings, but they don't
make the experience any better. They don't redefine the concept. They don't innovate the model or the
product/service offering. It's just another deli or Mexican restaurant.
On the other hand, a true entrepreneur is a business owner committed to continuously innovating -
innovating how they conduct business, and what they offer, innovating the experience people
encounter, innovating the way the product/service gets delivered/presented, innovating the
product/service itself.
Drucker didn't say it - but I see a proprietor as someone who sets up a generic business that's non-
distinctive, one that takes oxygen out of the air and cash out of commerce, but frankly, contributes back
very little exceptional value to the market beyond the "mere" self-serving commodity aspect of their
product/service offer.
Drucker - squarely sized up the difference between a proprietor and an entrepreneur. The proprietor
(he says) merely does what has been done by thousands before them. They don't try to create a new
satisfaction, experience or consumer demand. All the proprietor does is hope they can tap into existing
demand.
An entrepreneur creates something new, creates new experiences, new satisfaction, new definition of
what they do. Entrepreneurs create something different - more exciting, more satisfying, more desirable
or valuable to the market.
They change, transform or transmute values. Entrepreneurs focus on changing reference models. They
find ways to improve, redefine products/service experience, the process. Perhaps, MOST importantly,
entrepreneurs make truly positive impacts on their market.
They are committed to being "game changers" - true innovators who renew, shift, alter, redefine their
marketplace position and product. They multiply the benefits, magnify the experience, maximize the
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advantage--FOR the consumer. It's ALL about benefitting the consumer!
When you look at the year ahead, ask yourself a sobering question. It's this: Am I merely siphoning cash
out of my market's momentum - or am I truly adding innovative value? Am I a multiplier---or a
diminisher?
Am I making a huge positive impact--or no worthwhile/significant effect, whatsoever? Can't answer? If

that's the case, you probably AREN'T innovating and/or adding anything meaningful, purposeful to your
marketplace or their experience. You probably AREN'T making any true, positive impact!
True entrepreneurs require no certainty, instead they "feed on" opportunity. Problems are their fuel of
achievement. Challenges are their competitive advantages.
Probably the biggest differentiation between being a value creator or a "commerce siphon" - is whether
or not your business is based on purposeful/impactful innovation vs. pure profit motivation. Profit
today, more than any time in the past is a by-product of contribution and the amount of value that your
business adds to the consumer.
Obstacles in an industry are motivators for the entrepreneur to figure how to surmount
inventively/advantageously.
Why? Because businesses are not static. Yours either grows or it dies. But growth can be illusory. A
business can increase sales and even improve profits (short-term) while actually losing market meaning.
The entrepreneur that does NOT innovate inevitably ages, declines, struggles, stagnates, suffocates or
dies.
But don't think that entrepreneurship is natural, automatic and just naturally flows to some lucky
people. It does not! It's hard, continuous work - but what isn't?
If you're a proprietor - you need to convert and become a "Born Again" entrepreneur. How? Try this:
* Become supremely receptive to seeing change in marketing, change in consumer buying habits,
change in competitive offering as an opportunity rather than a threat.
* Continuously evaluate your business and its performance as an innovator/value creator in as many
critical categories as possible, i.e. product development, value added, buyer experience, performance
dynamic of product, service people.
* Become obsessed (almost) for discovery, development, perfecting new things - new ways of
marketing, new ways of delivering your products/service, new ways of improving the transactional
experience. See your world differently than your competition.
* Learn to overcome resistance to innovate, by wanting/craving continuous breakthroughs in marketing,

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strategy, innovation, your business model, your competitive positioning..
Any business owner who tries to hold on to the "status quo" will lose ground, rapidly. Recognize the
importance of innovation and the fact that it takes time and resource allocation/investment to bloom.
You can't merely wish for your business to become a true value creator to the marketplace. You need to
plan and execute, nurture (and nourish) specific, progressive steps.
Nothing good or great comes without effort and hard work. But if you crave new ways to reach your
market, new product/service offerings or impact, new markets to serve, new methods for doing
business, new technologies to produce a better outcome, new ways to successfully compete - your
business CAN thrive!
Final lesson in your reality check: Everything has a limited...oftentimes shorter life and profit
expectancy--than we think. So, if you aren't committed to making your current approaches (and current
thinking) obsolete and continuously replacing them with innovative new ways - rest assured, your
competition will do it to you and for you.
Bottom line?
Are you an entrepreneur who innovates and adds constant value and positive impact to the market---or
only a proprietor taking cash out of commerce?
Whichever you HAVE been - there's only one thing to BE today - a "full-on" entrepreneur. Remember,
too, that innovation and breakthroughs may need to be started small, but their returns, pay-offs and
rewards should be huge.
I'm selling nothing here--except selling YOU on performing this self-reality check. I hope you passed!
Jay Abraham
P.S. In a few days, I'll send out an expanded essay a good friend has written, titled "Are You a Multiplier
or Diminisher?" It explores a dimension of entrepreneurship --- from a very fresh perspective that I
think you'll find worthwhile.
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Wanted: 200 REAL Entrepreneurs. Size Doesn't Matter. Are You One?
You probably won't like this - but I came to a huge realization over New Year's about business. Large or
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small - simple or complex. It really doesn't matter. There are three kinds: Proprietors, entrepreneurs and
large corporations.
Most of you - and most every business owner may (sadly) unintentionally be a mere proprietor. You're
taking oxygen out of the air; your diverting capital out of the economy -- but you're NOT really adding a
lot (if any) true contribution/benefit --- beyond the commodity value of whatever goods or service you
sell.
Peter Drucker - the mammoth business genius said it better than I ever could - the husband and wife
who open a delicatessen or Mexican restaurant are surely taking a risk. But are they entrepreneurs? No!
All they do is what has been done many times before them. They gamble on the increasing popularity of
eating out in an area - but they create NEITHER a new satisfaction, nor a new consumer demand.
The true entrepreneur has to have special characteristics over and above being new and small. In fact,
Drucker believed that true entrepreneurs are a minority among most small businesses.
I agree!
True entrepreneurs are a rare and elite breed.
They create something new, something different. They change, innovate or transmute values. In short,
real entrepreneurs don't need to be small or large. It's more about your focus and purpose, AND
COMMITMENT to transforming the industry/business model, value proposition, buying
experience and overall benefit delivered to the consumer.
People who need certainty are NOT likely to be or become true entrepreneurs. They are destined to be
mere proprietors. Where's the big difference? Drucker says it's more about your business concept and
theory...than current ability.
The big key (he says), that differentiates the wheat from the chaff - the entrepreneurs from the
proprietors is their commitment (or lack thereof) to purposeful innovation. The true entrepreneur is
willing, eager to perceive change as a huge opportunity, rather than a threat or deterrent. He/she must
have built-in commitment, to constantly improve their performance - on many different "fronts."
While the proprietor cowers from change, fears change, grovels and steeps themselves deep in the
status quo... the true entrepreneur is ALWAYS excited, committed, continuously searching for new
innovation. He/she wants innovation, they're receptive to things that challenge their current beliefs,
business structure or business model. Real entrepreneurs REACH for innovation. They work hard to
discover, uncover, define, refine and initiate innovation.
Mere proprietors try to hold on (desperately) to the past and what already exists. True entrepreneurs
know that change and innovative thinking is the perpetual path to decisive advantage and profitable,
sustainable growth. They find innovation an attractive concept to invest in, educate themselves on...and
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master.
True entrepreneurs start their enterprises recognizing the constant need for innovation and factor into
that need -- the critical time frames required to stimulate the never-ending changes that propel their
continued, purposeful existence. They've got continuous innovation plans laid out along with specific
objectives/purposes for doing them.
Now, I'm going to make this concept MORE complicated. Because, the direction of innovation your
entrepreneurial business takes MUST focus where the business can make the maximum contribution to
the market.
How does someone who realizes themself to be a mere proprietor "transform" into a true
entrepreneur? You need a systematic commitment to abandon whatever in your business is outworn,
obsolete, no longer productive as well as mistakes, failures, underperforming or misdirected
efforts, actions or opportunities.
Innovating requires a major effort that (frankly) most people reading this WON'T be willing to make. You
have to be able to free your mind -- to see your challenges as "benefits," plus devote the financial
resources and time/effort to make meaningful innovation occur.
Do you know, for example, how desirable (or irrelevant) your value proposition, business approaches,
marketing message, purchasing experience really is to the marketplace? Do you know how appealing (or
unappealing) your current products/services are? Do you understand the changing attitudes, beliefs,
behavior and buying dynamic of your market?
Do you have a clue what additional/alternative channels and avenues of approach are available and how
to best access/exploit them? Do you sense how much larger your business niche, product category will
continue to grow or even remain relevant? Do you understand what product/service alternative might
take their place and why and how - and when? Do you have a plan for compensating or exploiting this
outcome?
Do you know IF or where/when your current business and its marketing/selling/product/value

proposition will become obsolete? And if you answer "yes" to any/every question, do you have a
proactive/entrepreneurial strategy in place -- to address these issues?
Again, change is certain. Businesses grow or die. But growth connotes much more than merely
multiplying current revenue and even profits. Do you understand that "opportunity" means constant
innovation, not just finding more sources of current buyers? If opportunities to innovate die from
neglect, your business can die along with them.
If you are a true entrepreneur, you understand the need to stay deeply focused on both the problems,
and on the emerging opportunities.
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Finally, true entrepreneurs recognize that innovations almost always start out small. But if nourished
and respected - should end up producing BIG payoffs.
To be continued….
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A Monster-Sized "Gift Basket" From Me!

I really don't know if you open--or read many (or any) of my e-mails.
But last week I sent one out that had...at the very tail end---a disarmingly "mysterious" link to a landing
page that I encouraged you to opt-into.
You may have read it. Or you may not have.
Doesn't matter. I'm moving from implicit--to explicit. From "ethically covert" to "humanely overt."
Here's the scoop:
A few months ago, a famous financial advisor wanted to source some wonderful, potential new client
companies for me. So he made a bold deal with me. If I'd agree to "gift" all his business-owner readers
with an outrageously extensive collection of my "stuff," he'd tell the bigger companies on his list that
they needed to talk directly with me about doing a profit-on-performance, long-term consulting deal,
together!
His premise (which I liked) was that MOST of his readers were NOT big enough to work with me directly.
But ALL of his readers were deservingenough (and would be appreciative enough) to be benefitted by
my body of work---AND that good things would definitely come back to me...long-term, for making the
gesture.
We did it and the response was thrilling to me--particularly thrilling to read the letters of appreciation
from those smaller, deserving enterprises that gained more understanding, clarity, and a greater senseof
certainty (about their prospects for a successful future) by reading, listening and watching all the
valuable resources I'd gifted them.
So, in the spirit of contribution---and with the assumption that many of you DID NOT see the subtle link I
placed at the very end of last week's long e-mail...I'm offering you a second chance to receive all these
goodies-gratis.
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You do have to opt-in...only because I didn't have time to eliminate that function when I decided to gift
it to my readers last week. But--think about it--I already have your e-mail address. So, it's no big deal.
What's there waiting for you? You can see everything spelled-out, fully-described, and extensively-
explained and discussed in surprising detail---on the landing page---well BEFORE you ever have to decide
to opt-in.
Then--because this treasure trove/bounty of my materials IS so huge---I decided to leave the access
open and valid for you---for 60 days---So you don't feel rushed or pressured to download everything
immediately.
Two final points, both are important:
1) I originally did this landing page as a gesture of appreciation to a very good friend--who trusted me--
enough--to recommend my private advisory services to those companies on his list that were large
enough/suitable. Obviously if YOUR business is large enough/suitable WE should talk, too! (In fact I'm
sending an e-mail tomorrow inviting qualified companies to contact me.)
2) Nothing on the landing page you are about to visit sells a thing. Also the materials I'm gifting are
complete, unedited, full-length versions. THESE ARE NOT TEASER ITEMS! They are richly revealing, full-
on versions of some of my very finest resources---that should vastly expand your business performance.
Here's the link: http://www.abraham.com/gifts/thankyou.html

H H
Enjoy,
Jay
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FIVE INSIGHTS.Each a Game Changer.
Here are five insights. Each, if applied properly, could become the foundation for more profits than ever
and breakthroughs that can "game" change your business...
Few entrepreneurs think this way. There are almost always... deeper, richer veins of marketing
gold to mine; faster, greater profit sources to tap into. You just need to know how to see/seize
them.
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Let's start with an obvious one:
Why are things like joint ventures so important?
I've done three billion dollars' worth of them for past clients/partners.
Things like joint ventures and alliance deals let you penetrate new markets and acquire high
quality clients with NO risk or fixed investment. You can instantly create unprecedented, upside
leverage, slash the sales cycle in half, and achieve mammoth, instant credibility/trust.
"Leveraged Marketing" lets you create almost unlimited profit power, at will -- by multiplying
and magnifying the performance yield of everything you do.
Ancillary marketing lets you create multiple, new income streams, profit sources by repurposing
your brand, distribution channels, old buyers or even unsold prospects. Together, these two
strategies can help almost ANY business multiply their profits meaningfully, both on the front
and back-end and---from obvious (and overlooked) markets.
Changing headlines or shifting the opening in a sales proposition (email, brochures, radio scripts,
websites, etc.) can (often) increase sales response--by orders of magnitude.
That means that, the same time, the same effort, the same people, the same opportunity, the same
market, can NOW deliver multiplied performance -- with no extra investment, staff or risk.
Take 60 seconds right now and write down five, non-competitive companies who have direct
access to the same market you're targeting. Then list five current selling activities/processes you
may be able to leverage-up!
Ask yourself who (company, organization, media or key influence) ALREADY has strong,
credible access to the same type of buyer you're trying to sell. What do your prospective buyers
purchase before, during, after they buy what you sell? Who commands their trust and respect,
right now? Who has credible influence/direct, respected access? What activities seem weak, low-
yielding?
Preemptive Marketing and Referral Programs:
Preemptive marketing can often let you "block" ALL your other competition from being
compared to you (turns you from a commodity into a proprietary, and thus: The only viable
choice someone can make).
You then tower defiantly above the maddening crowd. Irresistible propositions can produce far
more people saying "yes" to your sales people, website or email offer than saying "no." Adding a
high-profit, back-end to your current sales offering can multiply the profitability of a buyer--
sometimes by many times, over.
Coming up with a lower-cost, less threatening, entry-level product/service can make it easier for
more people to start doing business with you--and do it faster!
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Systematic referral-generating processes can increase your company's business, sometimes
exponentially, while slashing marketing and acquisition costs down to almost zero! There are 93
ways to do it. How many (if any) does YOUR company currently apply?
If your business is NOT doing as well as you want -- it's not necessarily your fault. If you have
long suspected that you're working much harder than you should--- you're probably right. You
may see no better strategy to use--right now. Yet, while the answer can seem elusive -- it may be
far easier to solve than you imagine.
... Be it advertising, selling propositions, email offerings... each activity can frequently/rapidly be
made to produce far more sales and profit growth - from the same effort... the same expense...
and the samemarketplace opportunity. Your business could multiply your profit performance by
a huge margin - IF you learn what to do differently.
We're talking about "upping-the-ante" on your strategy performance, your business model
impact, your competitive positioning clout. It may just be a matter of looking at things from a
different strategic angle --- or perhaps by tapping into one or more different (and better) sources
of buyers, or rethinking your current advertising or selling approach.
It's about getting the highest and best sales/profit performance-possible --- for/from the same
advertising expenditure, the same sales force effect, the same marketplace opportunity, the same
product or service offering, the same effort or expense, the samebuyer/prospect and sales
interaction.
The key here is to replace - or sometimes, just adjust --- under-performing ads, sales approaches,
marketing activities with higher performing, superior marketing "powerhouses." It's also finding
a better strategy to follow, a better business model to apply.
The key is to know how much MORE is REALLY possible... where highest impact change is
most optimally (easily/rapidly) applied...and how (and when) to implement, based on YOUR
particular business, market, competitive situation and history.
This is NOT a one-size-fits-all "fix," and it's certainly not throwing "performance improvement
darts" at the wall to blindly see what sticks.
It's all based on understanding "Optimization" - meaning, getting the highest and bes
tperformance-possible. I created a strategy long ago called the PERFORMANCE
ENHANCEMENT QUOTIENT. Simply put, it lets you identify the hidden opportunities,
overlooked revenue streams, underperforming activities you can most quickly/meaningfully
improve.
Everything from joint ventures, to preeminence, to leverage marketing to preemptive positioning,

to back-ending, to making irresistible offers, to making unbeatable packaging propositions, to
using "high-credibility" endorsements, to mining ancillary income streams, to maximizing
back-end, front-end selling opportunities, to referral selling.
Or merely changing headlines, switching selling propositions, adding great bonus offers, risk
reversals - they can EACH skyrocket more performance.
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Am I absolutely, positively, 100% personally guaranteeing that YOUR profits will explode
through the roof? No, of course not. No one in their right mind would do that.
But I AM attesting that it's highly probable that your current

selling/marketing/advertising/positioning efforts do NOT maximize your
opportunities -- in whatever forms of selling or marketing or competitive business dealings you
currently do, NOW.
Multiplying your company's profit picture is the goal, here. Preferably, many times over.
Most business activities actually "underperform" their potential, unknowingly. In fact, you may
even feel like you're doing quite well. But unless you've tapped into the multiple numbers of
better marketing strategies, profit sources and income streams available... You're under-
performing your fullest profit potential.
To be continued…
75B ---------------------------------------------------------------------------------------------------------------------
76B
If A Tree Falls In The Forest--What's The Lesson?

If A Tree Falls In The Forest and There's Nobody Around Does It Make A Sound?
(OR--Is There ANYBODY Out There Listening/Hearing Me/You/YOUR CLIENT?)
So ok, when a tree falls in the forest it still DOES vibrate, right? Well when a prospect or client,
fan, follower evokes the need to be heard---do you feel their vibrations?
Still too abstract? Ok, how about this.... Nearly twenty years ago I started showing people how to
"feel and hear" their market's pain. Those that put their marketing ear to the ground (figuratively)
and listened---connected at unimaginably deep levels with their prospects---who rapidly
transformed themselves into loyal, passionate buyers/clients.
It worked "majestically" in every other form of marketing; So, why then is it so terribly hard to
comprehend that a market--in any form, be it online or offline, be it social or insular--every
human being merely wants to be understood, appreciated, acknowledged, respected, recognized
and made to feel important ( as they are.) we are all relevant, important, significant pieces of this
amazing puzzle we all call life.
So today--without purporting to be THE greatest social media maven in the cosmos--I'd like to
offer up some universal truths that should serve each and every one of you as a set of ideals,
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distinctions, guidelines and ideological/purpose-driven standards for communicating, connecting,
interacting with your fellow man and woman.
Be it via Google+, Twitter, Facebook, Linked-in, and every other form of human contact,
communication and direct verbal, written or visual interaction you and your business ever shares-
-consider these thoughts:.
By the way, this short-course primer is NOT specific. It's up to YOU, personally----to translate it
specifically to your various applications. My intention today is to shift your paradigm, animate
your thinking and teach you function over form, quality over quantity--and purpose over profit.
Buckle-up, 'cause I'm going to do this quickly and simply:
You may be too young to remember the movie, "What's It All about Alfie?"...But here's what the
meaning of business life is ALL about in any/every form of positive impact you ever express--no
matter the media form...
Show people authentic empathy for their situation, Make them know they have relevance.
Recognize THEIR perspectives and situation, too! Always sell one thing: Authentic, purposeful
leadership. Demonstrate truly, clearly that YOU genuinely feel what they are feeling. Show
people you clearly understand their problems, challenges, frustrations, goals, hopes/dreams.
Don't give people information,. Render well-reasoned ideas/advice/perspectives they can believe
in/trust. Help provide people with true focus. Focus is clarity. Clarity gives people power. Power
gives people understanding. Understanding gives people confidence and certainty. Certainty
gives them the ability to trust.
Without trust people will never take meaningful action--or believe. So always, always give them
viewpoints they can trust. (See Stephen M. R. Covey/Greg Link and their wonderful books on
trust building). Since most people don't have total focus, when YOU help provide it to them--that
leads to true/authentic "connectivity". Connectivity is the fuel that allows people to take the next
step-forward.
You need to cultivate the ability to put into words what people want and don't want. Show them
you understand them so well, you can clearly/crisply/dimensionally verbalize what's been
gnawing at them so long.
Always sell a point of view -but selling does not mean manipulating, Machiavellian-like. It
means strongly, passionately, emotionally advocating your beliefs, viewpoints, thinking.
THIS is a "biggie"... ALWAYS make YOU--the prospect, you the fan, you the follower, you the
member of the community--THEY are who is REALLY important. You the vendor-- are NOT
the center of their universe. Make them the center of yours and you'll have a raving...no, make
that near-rabid fans for life!
Demonstrate real hopefulness for your marketplace.. the hope that they understand, the hope they
have a better day, the hope that they gain benefit and value from what you are saying, writing,
posting, tweeting etc.
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Think--how can you have the most positive impact in those few moments or sentences when you
are in their life, today? Remember too--no message, communication or interaction has any value
to the other side--UNLESS it has an impact.
People need to recognize your communication as a solution, elixir, to a problem, void,

uncertainty, gap they feel--emotionally, not merely rationally. Provide people with reassurance,
motivation that you truly DO care about them, their life, their issues, their relevance.
You can communicate result-inducing ideas--or merely provide them with a better feeling about
themselves and what they either are already doing--or should start doing.
Always question your purpose/intention for doing anything and everything communication-wise!
Ask yourself--If I were on the receiving end of this communication--would I be positively
impacted? Would I be eager to either anticipate the next communication--or better still, take the
next step you are after from me?
Most people, when trying to communicate with another-- fall in love with their message, or
themselves or their product/service. Try falling in love with the person your communicating
to/with, instead--not romantic love, but appreciative, empathic, respectful love for
who/what/where/why they are where they are in their lives/business.
Your goal here is to interact with people in a meaningful way that enhances their lives because
you--and your message were in it. Every time you communicate/connect--make people better off
because of what you did, said, shared. Better off can mean happier, more stress-free, laughing
Etc.
A mistaken belief in communication is to ask, "What do I have to do or say to get people to buy
into my proposition?" WRONG QUESTION TO ASK!
The right question is merely... "What value, contribution, benefit, or fulfillment do I have to
give them?"
That's enough for now... I'll provide lesson two/installment two in one of my next e-mails.
Think deeply, meaningfully, reflectively about what you've just read.
Jay
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Celebrity Deaths in 2011. What's YOUR Legacy Going 2 B?
(Originally sent on February 4th 2012)
This email is a serious one. It deals with legacy, purpose, possibility...and passion: Your Legacy. Your
business' (or life's) purpose. The possibilities for your business' future. And, finally, the passion,
emotional conviction and "grit" to make outrageously wonderful things REALLY happen for yourself or
business.
Confused? That's OK - work with me, here, for a minute.
So, I'm reading last week's Huffington Post "Celebrity" section on AOL, right? (Right!) It features a story
about an actor who'd just died. That story was interesting. But MORE interesting was the story that
followed. It was a listing (and description) of 121 other celebrities who had died in 2011.
Now in case you think I'm trying to take this discussion down some dark, macabre road - I really am
NOT. (Stay with me here...) My purpose is actually uplifting, inspiring, energizing to both your heart and
soul!
So, I'm reading all 121 listings and I got to thinking that --- each one of these men and women dedicated
their lives, their careers, their sense of possibility, passion and purpose to their various business, sports,
political, medical, and/or arts/entertainment and academic careers - AND they achieved mammoth
accomplishments.
They each changed people's lives with their work, efforts, vision, convictions and passionate purpose.
Let's quickly scan a few dozen of these impressive icons -- so your emotional juices will get "goose
bumps," too (like mine did).
Dick King-Smith, children's book author; Peter Yates, director; Don Kirshner, music promoter; Sargent
Shriver, former Peace Corp Director/Vice Presidential nominee; Major Richard Winters, decorated
WWII veteran and leader of the "Band of Brothers;" Jack LaLanne, fitness pioneer; Tura Satana,
actor/exotic dancer; George Shearing, jazz piano legend; Duke Snider, baseball player; Mikhail Simonov,
Russian Sukhoifighter, jet designer; Geraldine Ferraro, first female Vice Presidential candidate; Betty
Ford, former First Lady/founder of the Betty Ford Clinic; Sidney Lumet, director; William Nunn-Lipscomb,
Jr., Nobel Prize-winning chemist; Pietro Ferrero, Jr., CEO of Ferrero Chocolate.
Let's continue the list: Chris Hondros, photojournalist; Phoebe Snow, singer; Orlando Bosch, anti-Castro
freedom fighter; Sir Henry Cooper, boxing legend's Jackie Cooper, actor; Arthur Laurents,
playwright/director; Lidia Gueiler, first female president of Bolivia; Burt Reinhardt, CNN President; Derek
Boogaard, professional hockey player; Severino "Steve" Ballesteros, professional golfer; Harmon
Killebrew, Hall of Fame baseball player; Joseph Brooks, composer, Xavier Tondo, cyclist; M.F. Husain,
artist; Lucien Freud, painter; Elliott Handler, co-founder of Mattel; Ralph Marvin Steinman, Nobel Peace
Prize recipient/immunologist; Stephen Paul Jobs, co-founder of Apple; Norman Ramsey, physicist and
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Nobel Prize winner; Bill Keane, cartoonist; Ted Forstman, businessman/philanthropist; Joe Simon, comic
book writer; Christopher Hitchens, author journalist; Boris Chertok, Russian rocket designer; Michael S.
Hart, inventor of the e-book.
Do I really need to continue?
Bottom line? Lesson? Implications? Moral?
IT'S THIS:
None of us are victims. No one needs to be constrained in their pursuit of possibility, purpose, passion.
Doing is NOT thinking. Or restated, thinking about something is NOT doing it! "Doing" is all about taking
passionate, meaningful, committed Herculean action.
Purpose is having an "ideal" that's infinitely more auspicious and transcendent than merely making
money. It's about doing things that are meaningful, transformative and impact the marketplace or
society in some positively evocative way.
Passion is the joy, vision, hope for others and animated reality -- you focus all your efforts on
manifesting.
Soooo...my concluding thought is THIS:
Have you really, truly, honestly put EVERYTHING you could, EVERYTHING you should, EVERYTHING
possible into making your business/career pursuit the most successful, impactful, distinctive, value
based contribution of benefit it could truly be to your market?
Remember that...reading things like this, attending seminars/conferences, purchasing courses, books,
videos, CD's - that's all mere "preparation."
The key to achieving anything/everything is what Einstein said - "Nothing happens until
something/someone moves forward." Action, forward, purpose-driven action is what makes great
people great!
You can probably do a lot more with who you are, what you've got and the possibilities before you.
Think about it.
Regards,
Jay
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Watch This. Read This. Listen to This. Knowledge Transfer.
(Originally sent on April 27th 2012)
Short / Sweet
If you want your business to be more preeminent, you can watch me here doing a keynote that
teaches specific implications/applications that dimensionalize what it means, how it's done, what
it feels like on the receiving end or dispensing side: http://abraham.com/fbs2012-videos/
H
If you want to learn some "street smart" ways to think more resourcefully, impressively - read H
the transcripts of a fast-paced interview I did with Kevin Harrington, one of the original "sharks"
H
on "Shark Tank" - and the "Godfather" of infomercials (he also owns "As Seen On TV").
If you want to create near-infinite business "buying power," capital equivalent and almost
unlimited business resources -- at will, watch (and read) the rough transcript of my two, 90-
minute sessions on Relational Capital leveraging and maximizing.
Watch both videos at: http://abraham.com/mega-partnering-videos/ . Read the (Unedited) rough

H H
transcripts here:
http://abrahampop.s3.amazonaws.com/WatchThisEmailInfo/MegaPartneringTranscriptPt1.pdf
H H
and here:
http://abrahampop.s3.amazonaws.com/WatchThisEmailInfo/MegaPartneringTranscriptPt2.pdf
H
If you want to adopt a monster-sized, non-linear, unlimited "Business Performance Paradigm,"

re-read my document called The Abraham Mind Shift Challenge here .
H H
If you want to buy an info product or program, go somewhere else! Because, THIS email sells
nothing but "more possibility and performance potential" for your business. Seriously, they're my
gift, to you.
If you'd like to hear the audio interviews from my KABC Radio special I conducted with Mark
Cuban, Tony Robbins, Daymond John, and Rieva Lesonsky - go here: http://abraham.com/jay- H
abraham-on-kabc-radio/
If you tend to be a fatalistic, defeatist, negativist or procrastinator go here and re-read "Victor or H
Victim" and "To Be or Not To Be Relevant."

H H
If your business is stuck, re-read the Executive Summary of "The Sticking Point Solution" here H H
to see the nine ways companies can get stuck, stall, stagnate or suffocate.
If you're still at a loss for how to move yourself and business forward - re-read or listen to my H H H H
classic interview of business icon/sports legend Fran Tarkenton.
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If you need "context" go back and download my full-length interviews (transcripts) of "Super
Star Game Changers." [Shaq, Magic's business partner, Josh Linkner, Daymond John, Harvey
Mackay, etc.] http://www.abraham.com/superstars/interviews.html
H
If doing ALL this doesn't help - perhaps it's time to find someone new to follow - because I can't
want greater performance for you (and your business) MORE than you want it for yourself.
Epilogue: These contributions are made to benefit every/any entrepreneur who needs a champion
who's not after your wallet. I want to see you be more, do more, contribute more, out-market,
out-perform, out-sell, out-innovate all those you compete against in business -- on the
assumption you are truly committed to becoming a "Creator of Value" and contributor to your
marketplace.
Hope these contributions help move you there.
Respectfully,
Jay Abraham
P.S. If you only watch one thing... make it the video of me teaching "Contextual Understanding"
of Preeminence to personal trainers from around the world. http://abraham.com/fbs2012-videos/
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Stephen R. Covey Died Monday. The World Lost a Mammoth Friend.
(Originally sent on July 17th 2012)
Stephen R. Covey, author of "The Seven Habits of Highly Effective People," died unexpectedly
on Monday. The world is saddened by his passing, but has been blessed these 79 years by his
life.
He was a friend, but even more, he was a true benefactor to the betterment of our entire world.
An obituary in USA Today started out by calling him "A force of human nature..."
They talked about how his "seven habits" have been woven into the emotional wellbeing of
multimillions of people's lives - in almost every walk of life - from self-help to the corporate
boardrooms of big businesses.
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Bill Clinton said Stephen's book was one of three that every worker should read to
"dramatically" boost the nation's prosperity. Chief Executive Magazine said the Seven Habits
was THE most influential book of the 20th Century.
One of his most powerful - yet elegantly simple messages: "Seek first to understand, then to be
understood." He coined the concept of "Win-Win." He taught people (including me) to be
proactive. He stimulated people to think differently, more respectfully, empathically, externally.
He stimulated you to examine your situation and circumstances from perspectives you never
considered doing before. And, invariably they'd discover an innovative breakthrough. One that
far surpassed the status quo.
Stephen R. Covey wrote his book for business people; but its message and influence crossed over
into their personal lives.
Families became stronger, values rose higher, relationships became more meaningful - ALL
because of one man's willingness to dedicate two decades of studying hundreds of books,
thousands of essays, legions of different philosophies, ideologies, methodologies - looking for
the simple, universal truths.
Interesting -- in a world where many people are looking for a short-cut or trying to "game the
system," Stephen's message was based on an immutable bedrock: Focus on your character,
values, conduct, respect for others, operate with unflinching integrity. Have the courage to be
extraordinary - not just of yourself, but in your ability to grow, develop, improve and enrich and
seed greatness into countless others. He also urged us to have patience.
Stephen loved entrepreneurs like you. He'd "always" make time from his busy schedule and
high-paid (we're talking six figures to speak for 60 minutes) activities, to contribute to me - for
you!
If that meant coming to Las Vegas the same day he'd landed from Tokyo just to talk to one of my
seminar groups for an hour - he'd do that, too. If that meant stepping out of an important board
meeting with some Fortune 500 corporation just to do a 90-minute conference call discussion
with my group - he'd willingly/enthusiastically do it.
I'd always get an admonishment from his assistant, saying Stephen can only do it for 60 minutes,
and then he'd continue --- sharing/inspiring/transforming my audience for 60 minutes more. He
was just an extraordinary man, a monumental mind, a mammoth influence for all that's good.
Stephen R. Covey was someone who changed every life he touched, myself included.
If you haven't read the Seven Habits book - do it, now! If you have, but it's been awhile, do it
again and have everyone in your world - business and personal - read it, too!
I was blessed to have Stephen R. Covey not only as a friend, but as a true benefactor of the
entrepreneur.
I feel privileged, honored and blessed to have had him and his influence in my life.
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I feel more blessed to have had someone transcribe some of the wonderful discussions and
interviews he generously did with me - about, and for - you, the passionate entrepreneur.
It is my honor, and privilege - to share two of those documents with you today.
It will mean a lot to me to have you read them or re-read them if you have them already (but it's
been a long time). But it will mean far more to you in the shifts you will make.
One is the full transcript of a nearly two-hour interview I conducted with Stephen on the topic of
igniting more passion, possibility and purpose into the hearts and souls of entrepreneurs.
The other is a distilled, "abstract" of a short interview we did of him right before the economy
came crashing down. They're yours-gratis. No opt-in required. No purchase necessary.
Just click this link to download instantly:
H Download the Steven Covey Interviews by Clicking Here
(Note: If you have problems, just right click the link and choose "Save As")
In fact, I urge you to pass them around to everyone you possibly can. They don't benefit me one
iota. But they do enrich and illuminate everyone who reads them.
Anyhow, here are both the long and short documents. One we did in 2005,
and the other in 2008.
Also, since Stephen's son, Stephen M.R. Covey is also a precious friend and personifies in his
professional life all his father stood for - I'd like you to ALSO have a profound interview I was
equally privileged to conduct with him on the concept of trust's role in our business and
personal life's success.
Again, I felt enormously lucky to have had Stephen R. Covey befriend me and my work. You
will be equally blessed if you follow his teachings.
Again just Download the Steven Covey Interviews by Clicking Here . This is a direct
H H
download - No opt-in required.
Stephen R. Covey truly was a force of human nature. You'll understand why when you read his
perspectives on life.
Respectfully but sadly,
Jay Abraham
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REVIEW: Are You a Multiplier or Diminisher?
Robert Hargrove is a passionate advocate of true entrepreneurs. He’s a passionate

detractor of mere proprietors who add little or no real advantage/value/contribution to the
marketplace.
He says that certain business owners work hard to increase their own and their team’s
passion, performance and collaborative skills. Others work hard (unknowingly) to destroy all
those attributes.
One group of business owners build up their market and reputation with their buyers.
Another destroys their connection capability. One group of business owners can take a
team/staff of average people and by instilling the right mindset, a purpose-driven focus and
strategy – can do something truly extraordinary. Another group can take extraordinary talent
and do something destructive.
Robert’s point? Business owners are either a multiplier of their situation, resources and
opportunities – or a diminisher!
You need to focus on becoming a raving fan of your clients, your team and the value you
can bring to all involved.
So, here are some soul-searching questions Robert Hargrove suggests business owners
constantly ask yourself:
Are you a Multiplier or a Diminisher?
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Sometimes questions can be far more empowering than answers.
I read an article on the airplane that profoundly impacted me. It was designed for
entrepreneurs.
It started with a question: Are you a multiplier or are you a diminisher?
Do you increase and multiply the passion, the performance, and the communication,
collaboration and developmental skills of your team or do you tear them down?
It mentioned that a “Multiplier” can start with a staff or team of just average people and yet,
with the right mind set, with the right strategy, they could do something truly extraordinary
with the business.
On the other hand, someone who is a “Diminisher” – not a multiplier- can start with great
people – all of them passionate and committed and end up with really- almost NOTHING.
Your goal as a true entrepreneur is to have your team members be raving fans but raving fans
of 3 different groups:
1. Respected client whose life they’re going to transform.
2. Of one another so they will collaborate and synergistically cooperate.
3. Of you, so that they will follow your lead because they know you’ll have their best interest always at
heart.
So, in this article they had a test for entrepreneurs to decide whether they were a Multiplier or
a Diminisher. Take the test:
1. Do you regularly look outside your business, to other businesses and other reference examples for
new ideas, fresh approaches, and innovative ways to motivate, to maximize and to really grow and
develop yourself, your people and your relationship with your clients/marketplace?
_____________________________________________________________________________________
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____________________________________________________________________________
2. Are you recognizing and understanding completely the exciting new possibilities to develop and grow
and support the ability and the effectiveness of each one of your team members (as well as yourself)?
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_____________________________________________________________________________________
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3. Are you open minded and humble enough and able to take breakthrough ideas and concepts from
other people/businesses/team members, from other coordinators, from other outside areas and utilize
them to your maximum advantage to let your business grow and prosper?
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4. Do you make everyone around you feel smarter or appreciated or more capable… by that I mean have
you giving up to be the smartest man or woman (and realize that your greatest ability is to make others
feel competent, respected and capable)?
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5. Are you able to take a group of talented, passionate people and make them capable to work
collaboratively in a way that allows them to accomplish extraordinary things (for the market) together
that could’ve never before reached individually?
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6. Do the people working with/for you say you’re the best boss, best leader, teaches that you are
helping them grow and develop and that together they feel like they’re accomplishing something
meaningful?
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7. Have you demonstrated through your leadership, through your preeminent advisory conduct that you
really DO have the capacity to take your people, to take your business, to take your market place, to
take your value proposition and grow and multiply all their success?
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If the answer to any of those questions is “No,” then all you have to do is sit down and
figure out who you need to be and what you need to do differently to be a Multiplier, and NOT
a Diminisher.
A Multiplier who can grow your business by leaps and bounds, to distinguish yourself as
the most powerful creator of value, of greatness, of contribution for all the people you ever
work with/for.
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Jay Abraham’s Multiplier vs. Diminisher
Let me draw a quick blueprint for greater professional success.
I'm doing this because someone has to push, pull, cajole, provoke, inspire, and outright believe
in you enough to get you off the dime -- to take the rest of your life and the future of your real
estate career more seriously.
So here goes. Buckle up...
In any business -- you are either a Multiplier or a Diminisher. You grow as a person, grow
relationships, grow ability, grow passion and grow purpose -- it's THAT simple!
Today, it's not how many people you talk to but the quality of the interactions you have that
determine success.
Your conversations have to be masterful, meaningful, and impactful.
You have to be able to ask penetrating, authoritative, powerful questions-- and respectfully
know how to utilize and harness the answers those questions reveal and ethically control the
dynamic of that situation.
So, I ask again-- are you a Multiplier or a Diminisher?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
You need to be able to multiply your reach, multiply your impact and multiply your fans.
You need to create a dual valve of raving fans...meaning you need to be an outrageous raving
fan of your market, your community, your neighborhood...
You need to be an inspired fan of every client you ever serve.
Conversely, you need every client, every merchant, and every person in your community to
become a never ending fan of you.
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So let me ask you AGAIN...are you a Multiplier or a Diminisher?
Do you recognize all of the possible opportunities that are right there in front of you in your
market?
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______________________________________________________________________________
Are you able to think in game changing, paradigm shifting, new possibility-based ways that will
drive incredible market superiority for your brand and actions?
Do you make everyone around you feel better, more secure, and more confident because of
what you do, how you do it, and your motivation?
______________________________________________________________________________
______________________________________________________________________________
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Do people call you the greatest mind, the most trusted expert they could ever turn to?
Do you really know and have you figured out who and what you need to become and what you
need to do differently to become a multiplier to grow your business exponentially?
______________________________________________________________________________
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______________________________________________________________________________
Do you even understand the distinguishing characteristics you need to instill in yourself to be
transformed into a true multiplier?
Again I ask you...Are you a multiplier or a diminished?
If your goal is ultimately to grow your business by first growing yourself then -- first, you must
change something in your belief systems and how you think.
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Why? Certain thinking patterns and behaviors produce certain results. If you think the market is
on fumes, if you think you are hanging on by a thread, and you think there is no hope for
tomorrow, guess what, those beliefs and thinking patterns are correct and you are in fact
doomed. You might as well quit.
On the other hand, if you want to recreate your way of thinking and adopt the thinking of a
multiplier, you can be like the thousands of top real estate agents we coach and counsel each
and every month that are making more money and experiencing the kind of business growth
that they never imagined.
Again I ask... are you a multiplier or a diminisher?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What's your passion level? How strategic are you? How distinctive and respected are you in
your community? How focused are you on what is really important? Do you even know? How
much do you care about the wellbeing and outcome of others?
What are you doing right now to change your real estate world and your destiny?
______________________________________________________________________________
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Famed educator William James probably said it best:
"There are two kinds of people: The once born and the twice born. The once born people never
stray from the familiar territory of who they think they are, what they think is expected of
them, and what they think they can accomplish. Twice born people pay close attention when
their soul pokes its head through the clouds of a half lived life. They discover a path to a more
genuine, radiant, and enriching reality, and they go for it. "
In our opinion, the person who wants to journey out of the world of the once born into the
phenomenal world of the twice born starts when you come to a crossroads in your life where
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the old ways of doing things are no longer working -- and you know a better way needs to
appear somewhere along the edge of despair.
Well, guess what...we represent the road less traveled. We represent the answers you are
seeking. Twice born people draw their identity from the possibilities, the passion, and the
dreams. We've installed, inspired, and instilled greater passion, greater dreams and yes, greater
performance capability in real estate agents producing record setting performance and record
setting quality of lives for themselves in today's market at perhaps a greater level and
consistency than anyone else.
If mediocrity is your way of life and you enjoy it, stay there. If you want to start growing, not
just your business, but your quality of life by leaps and bounds. Give the chance to make that
happen. If you're following the same worn out burnt out business model. If you are harboring
the same flawed self sabotaging belief systems, give the chance to transform your life.
P.S. I recognize in this way of thinking the ideas and influence of famed corporate executive
coach Robert Hargrove. He is the man they bring in to transform corporations. He is the man
who turns around stagnant products and management. He's the man the bipartisan committee
asks to come to Washington to teach how to collaborate and make great things happen. He's
the man who influenced our thinking in writing this section.
REVIEW:
1. Do you understand the distinguishing characteristics you need to instill in yourself to

be transformed into a true multiplier? List the differences between being a multiplier
vs. a diminisher:
List the most important skills you have learned about being a multiplier and how you will
implement them to your business:
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So You Want to Create a High Growth Gazelle? By Robert Hargrove
This article will show you how to become an iconic CEO and a game-changer who uses
disruptive innovation to drive new profit growth and new revenue growth.
The CEOs of high growth companies—like Apple, Zappos, and Netflix—have a special
way of being that results in blockbuster brands, game-changing products, and exponential
growth. This way of being seems to come from both the soul and the market, transcending the
kinds of things taught at Harvard, Stanford, or Wharton B-schools, as well as the top ten
business strategies you see listed on Google, Twitter, or Facebook. If you are the CEO or
founder of SMEs, this article will help you to alter your way of being, consistent with building
your own blockbuster brand, coming up with game-changing products, and driving new profit
growth and revenue growth.
My research on the top performing companies over the past decade shows that the
success of CEOs likes Steve Jobs of Apple, Richard Branson of Virgin, and Tony Hsieh of Zappos
doesn’t come from any leadership or management recipe. It comes from who they are. Each of
us has a way of seeing the world and away of being that determines the size of our aspirations,
our strategies, and options in any given situation. It’s Steven Jobs’ whole way of being that has
produced the Macintosh computer, the iPhone and iPad. It’s Richard Branson’s way of being
that has produced the unique culture of Virgin Brands and so many successful entrepreneurial
endeavors. It’s Tony Hsiehs way of being that has produced Zappos, a company that not only
sells shoes, but prides itself on “delivering happiness.”
If you get to spend time around these CEOs, as I have, you discover that their way of
seeing and way of being is markedly different from the tightly wound CEOs of your Fortune
500corporations who try to grow their business and grow it faster using the same deck of 52
cards, often winding up watching their revenues and profits slide and their company walk
through the valley of the shadow of death.
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Most CEOs and founders are as unaware of their leadership and management DNA as
they are of their biological DNA. The intent here is to help you to develop the leadership and
management DNA of someone who can transform ideas, talent, and cash on hand into a billion
dollar enterprise versus someone who shoots down ideas, crushes talent, and exhausts
financial resources.
The Leadership DNA of the High Growth Enterprise
126B “I don’t want to think about how many people have thought or still think that I’m crazy.” Dean
Kamen, CEO, DEKA, Inventor of the Segway, IBOT, and Slingshot
1. Iconoclasts Who Live Life on Their Own Terms

When I travel around the world coaching executives, I often go to lunches where people
present me their business card. In most cases, these business cards are a way of saying, “I’m in
a powerful position as a Vice President. I have a PhD in electrical engineering from Stanford,
and I am a member of our fair city’s Chamber of Commerce.” I always chuckle because this kind
of introduction tells me the guy has spent his whole life trying to look good for the boss,
delivering predictable results as promised, with occasional incremental improvement. By
contrast, CEOs like Jobs, Branson, Hsiehall dropped out of college, were guided by their
entrepreneurial passion for wild ideas, and lived strictly on their own terms. As they say, the
proof is in the pudding.
2. Entrepreneurs with Passion, Patience, and Hustle

Most CEOs of big, medium, and even small enterprises tend to act like stewards who polish up
grandma’s china. The CEOs of high-growth companies are entrepreneurial innovators in terms
of their brand, product, and marketing. These entrepreneurs recognize that passion is
everything, yet at the same time, hustle and patience play a key role. Gary Vaynerchuk grew up
in his family’s wine business in New York City, which produced about $6 million in annual
revenue. One day he turned his smart phone video camera on himself and started something
called Gary’s Wine Library which he posted on YouTube. The result was that the business grew
from $6 million to $60 million in four years. Hustle played a key role in producing almost 700
episodes of The Wine Library. Gary says that most nights he didn’t shut down his Facebook,
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Twitter and YouTube accounts until 3 am in the morning. Patience is also important. A
surprisingly high number of successful high-tech startups walk through the valley of the shadow
of death for years, until one day their business turns around.
3. Outrageous Growth Ambition

Most CEOs and Founders who start a business think in terms of putting a sign over the door,
coming up with a basic bread n’ butter product or service that customers in the neighborhood
will buy, making enough money to see them through the next year, if they are lucky. If their
business happens to grow into a high-growth business, it does so by accident rather than
design. By contrast, CEOs and founders who become billionaires start with outrageous growth
ambitions. They think in terms of creating a high growth gazelle from the start, which shapes,
limits, and defines the way they see themselves as a leader, their brand, their business model,
products, and services. We have designed a Blueprint for a Billion, basedon what we have
discovered are the10multipliers of high growth companies, to provide you the guiding ideas,
tools, and methods by which you can create a high growth business by design rather than by
accident.
4. Disruptors who are Absolutely Intolerant of the Status Quo

It’s amazing how many of the CEOs of high growth companies became billionaires as a result of
an extreme irritation with the way customers are treated. It’s often extreme irritation with the
status quo that leads them to challenge things with disruptive innovations that offers
customers alternatives. I love Richard Branson because, while he is very good natured and
genial, he has an extreme distaste for companies that bully their customers. As he puts it, “I’ve
had great fun turning quite a lot of different industries on their head and
making sure those industries will never be the same again, because Virgin
went in and took them on.”
5. Creative Synthesizers (Connecting the Dots)

Today probably every CEO in the world has asked, “How does Steve Jobs constantly come up
with the next great thing?” The answer is that Jobs is excellent when it comes to connecting the
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dots. The iPhone is a result of an entrepreneurial innovator connecting the dots to come up
with what Peter Drucker calls “a new satisfaction,” not a result of technological innovation. The
iPhone is a marvelous hybrid of a cell phone, MP3 player, mobile computer, and software store
selling apps. When you tie all these together, the result is, not just a smart phone, but an entire
ecology, which is what makes it so hard to compete with.
6. Observers
Today CEOs of companies of all sizes think and operate from what Jay Abraham calls a “me
point-of-view.”They think in terms of their company, their brand, their product. The CEOs of
high-growth companies come from a “you point of view,” and think in terms of the customer’s
unserved, unmet needs. They are great observers of their customers. For example, Scott Cook,
the founder of Intuit, observed his wife getting angry and frustrated as she attempted to do the
family income taxes. He then had an “eureka” moment. What if I could come up with a
software program that would take all of that anger and frustration away and make the job a
hell of a lot easier? This led to the creation of Intuit and Quicken software that last year racked
up more than a billion in sales.
7. Networkers
The CEOs of high growth companies get their best ideas from talking to those who most people
in their roles might otherwise ignore. If they are the CEO, they talk to frontline employees and
customers. If they are Republicans, they talk to Democrats. If they are older (40, 50, 60), they
talk to people in their teens, 20s, or 30s. If they are marketing types, they talk to engineers. If
they are in the high-tech business, they talk to people who have farms and so on. These
seemingly random interactions can lead to innovative ideas. For example, the founder of Jet
Blue, David Neeleman, came up with the idea of paperless ticketing one day as a result of
talking to one of his agents in the airport who had her hands full dealing with passengers who
had lost their tickets. It was soon adopted by every other airline.
8. Questioners
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Where most CEOs and founders tend to like listening to the sound of their own voice, it turns
out that most billionaires spend much more time engaging in questions than they do in giving
answers. A good example is an acquaintance of mine by the name of Dean Kamen, the inventor
of the Segway and many other technical innovations. Kamen saw a map of Africa at night from
space a few years ago and saw that it was totally dark compared to the rest of the world. He
started asking questions that led him to find out that millions of Africans lacked electrical power
and clean water. He asked himself, “How? What if? Why not?” and came up with a new
invention with billions of dollars of potential, a vapor-pressured water distiller than could
provide clean water and enough electricity to run a lead of light for pennies a month.
9. Monsters of Execution
We all know about the importance of strategy, but to make strategy happen takes a leader who
is a monster of execution with an experimental mindset. A good example is Jeff Bezos of
Amazon. Jeff Bezos came up with the idea of Amazon, but was totally unprepared for its
success. When the flood of orders started coming in; he and his team were at a loss as to do
something as simple as fill the boxes in time to drive them to UPS by 9pm when the doors
closed. They started dragging piles of books off the shells and putting them in boxes. This
caused their knees to get sore and led Bezos to go out to Home Depot and buy knee pads for
the people on his team. Finally one day he shouted, “I’ve got it.” People looked up. “We need
packing tables.” He raced off to Wal-Mart to buy picnic tables and started getting the orders
out the door a lot faster.
10. Be a Multiplier vs. Diminisher with Employees

Leaders of high growth enterprises either have one of two management styles; they are either
a multiplier or a diminisher. We have all had both kinds of bosses. The first is the kind of boss
who extends everyone on the team an “A,” making them feel smarter and more capable. When
there is a team meeting, the boss doesn’t act like the smartest man in the room, but listens
loudly and helps connect people’s ideas so as to capture the collective intelligence of the group.
The second kind of boss is, let’s face it, a diminisher; a person who is a disempowering bastard,
often without even knowing it. In their presence, you feel someone is looking at you as a C
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player who can never win, no matter what you do. It’s pretty obvious that the leaders of most
high growth companies are multipliers, rather than diminishers. A good example is Tony Hsieh
of Zappos who said, “My role is about unleashing what people already have inside them that is
suppressed in most work environments.”
I said earlier that the source of success of the CEOs of high growth companies is from
their whole way of being as a leader, rather than just coming from a particular strategy or
method of operation that the rest of us could just copy. I said also that each of us has a way of
seeing and way of being as a business leader that shapes our goals, the strategies, and options
available to us in any given situation. The point I want to emphasize is that, you have the power
to shift your way of being consistent with creating a top performing company that grows
exponentially and geometrically. One of the things I have discovered in working with CEOs and
Founders is that coaching can make a huge difference in accelerating the rate by which people
make that shift.
Today if you look at Facebook, Twitter, YouTube, and other social networks, almost
everyone you meet is a business guru, author, or speaker who can offer great content. In fact, I
would venture to say that we are all drowning in great content about how to fix whatever ails
our business. The problem is that, given whom you are, great content doesn’t tell you what you
need to know. I have met so many leaders who seem to possess all of the right answers and yet
who still wake up every day staring at a wall. It’s not that these people don’t have a sincere and
honest intention to apply what they have learned it’s that given their leadership and
management DNA code, they just can’t. As Jay Kim Woo, former CEO of a Samsung told me that
there is a difference between knowing you need to be an entrepreneur or you need to be
innovative and actually showing up that way in your organization. It’s not as simple as putting a
computer chip in your ear.
What I am talking about is that, what is required for most business leaders is a 100
percent transformation of their way of seeing and way of being. That transformation will give
you the kind of access you need to take advantage of things like our Blueprint to a Billion (see
infographic at the end of this article). Now in my experience, you can attempt to transform
yourself, but it make take you a couple of lifetimes, because we all suffer from the
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phenomenon of blindness. My experience is that a masterful coach can make a big difference in
accelerating your transformation, as they have the ability to rip your blinders off.
When I coach people, I usually do so by raising their goals and aspirations. “Let’s stand
inside the possibility of creating a high growth gazelle.” Then I coach them simultaneously on
both on who they need to be, and what they need to do to realize it. For example, I coached
Mark Hewitt, the CEO of a relatively successful land development company in London with sales
of 6 million pounds. The toughest part of the coaching was getting him to think like the CEO of a
high growth gazelle versus thinking like a shopkeeper who was trying to make sure his company
had enough income get to them through the year.
“How badly do you want to crush it? Is it an all-consuming feeling? Do you stay awake
all night, your brain swimming with ideas and dreams? Are you willing to do whatever it takes
to live entirely on your own terms?” Gary Vaynerchuk, Author of “Crush It”
To help with that transformation, I talked to him about each of the attributes above on
a monthly basis. At the same time, I coached him on our Blueprint to a Billion, the 10 Multipliers
of High Growth Companies, and applying one multiplier at a time to his business in a step-by-
step process. At the end of 2 ½ year coaching engagement, the revenues shot from 6 million
pounds to almost 36 million pounds, which was impressive. Yet the more impressive was a
comment he made to me, “You talked to me about transformation and I didn’t believe it. Yet
today, I feel that the person who I am didn’t exist before, and the person who existed before,
no longer is.”
How will you become a high-wealth gazelle?

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LEADERSHIP SELF-ASSESSEMENT
Do you regularly travel outside your industry to find new ideas, fresh approaches, and
innovative solutions?
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Do you recognize the exciting new possibilities presented for building a billion dollar business
before they become obvious?
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Are you able to take an innovative business concept or game-changing product or service and
turn it into a jam-packed parking lot?
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Do you make everyone around you feel smarter and more capable? Have you given up the need
to be the smartest guy in the room?
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Are you able to take a roster of talented people and make them capable of joint performance so
that they accomplish things they could never reach individually?
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Are you focused on creating self-development and breakthrough growth experience for your
business?
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NOTES:
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Encounter!
With Jay Abraham and Tom Phillips
JAY ABRAHAM: You’ve already been introduced to Tom Phillips. He has delightfully and
wondrously agreed to spend a half hour summarizing for you two things: His story - how he got there,
not just, “Well, we did this, and you’ve got to do that….” But the mindset, the process, the philosophy he
builds it on; the strategy he operates by; what the implications of those actions are to you; and a
number of very specific ideas on some critical elements that compose some of the most powerful and
leverageable components of the eX! Factor Philosophy. And with that stated, I’m going to get off the
stage so I don’t take time from you. Tom?
TOM PHILLIPS: Well, thank you, Jay.
JAY: Thank you.
TOM: And thank you all (applause)
JAY: Thank you.
TOM: Yeah, I thank Jay, especially, for asking me to share some more ideas. After talking with a
number of you subsequent to my remarks yesterday, I got all charged up, and thought that there were
maybe a few ideas that I could share with you that would be helpful. So as Jay has explained, I’m
planning to do three things. Number one: I’ll tell you a little bit about the story of Phillips Publishing,
International; Number two: I’ll give you, hopefully, some ideas for building your business through
recruiting, motivating, training, and retaining your key business builders.
Then finally, we’re going to have a Q&A period. I think some of the Q’s will be from you; some
of them will be from Jay, I feel; and hopefully, we’ll get some answers, not only from me, but perhaps,
from some other ideas in the audience.
So what it my goal? My goal is to have you get some take home value – some concrete, specific
ideas that are applicable to you.
Now, you know I’m not a motivational speaker. I’m just one of you guys – a fellow
entrepreneur, business person, and so I think I know what you’re going through, because I’ve been
doing it myself for 23 years. So hopefully, having that bit of experience – I’ve been running my own
company for 23 years, and having been in business for about 7 or 8 years before that, hopefully I’ve got
some things that I can share. But also, I hope I’m sort of in your head a little bit; having lived some of
the emotions and experiences you’ve had, I’ve come up with some solutions, and I’ve made a lot of
mistakes. And so, I hope to share some of the best of each with you.
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First of all, the Phillips Publishing story. And I will only tell you the framework of it, the outline
of it, and especially the parts I think that might be of benefit to you. Not so much, “This is my story,” but
what can you get out of it? What can you learn?
As you’ve heard yesterday, I started the company in 1974 in the garage of our home. It was a
converted garage; we’d converted it into a den, and we had two kids then. We had toys in the den.
Well, they were deprived of their playroom, because the toys went out of the den and into their
bedrooms, and we moved the desk and a Selectric typewriter – used Selectric typewriter – in, put in
$1,000, and started the company.
Our first year, we had started two newsletters, and we did $300,000 in sales. That was the
launch pad for what has been built ever since. And we took five years to get to the first million dollars in
sales. But it didn’t bother me, because each year we were making progress. And that’s one of my
philosophies: Each year make progress. Each day make progress, for that matter. I don’t mind if there is
adversity, but I just want to make progress each and every day, and when you compound that, it’s like
compounding interest, or the $150 investment we’ve heard about this morning – you know, you’re
company is going to grow.
And so we have been growth oriented since the beginning, but that’s what we’ve looked at.
$300,000 was the beginning. (I think the actual figure was $293,000, but I’ve always rounded it up to
$300,000.
Took us five years to get to our first million. But how did we do this? We always reinvested in
the business. And I had a little saying that said, “If we take good care of the company, the company will
take good care of us.” And I think most of you in this room understand that – you reinvest in your
business. I did not take money out to invest in the stock market. I did not take money out to go on
extravagant vacations. I did not take the money out to live high. In fact, when I started my company, I
took a pay cut. And I would suggest that that’s a good first step, because it’s another reality check that,
“Hey, you’re serious about this.”
In those days, I was making, oh maybe $40,000, and I cut it to, I believe it was $32,000. Well
boy, I tell ya, after doing that, that really motivated me, because I couldn’t live on $32,000 anymore
after I’d been living on $40,000, so I took my pay cut, but I got it back up to the 40 built upon the success
of the company.
I thought I was a publisher. I thought I was a journalist, and a publisher, and a businessperson.
And along the way, after a couple, two-three years, I was talking to an old professor of mine. I had an
undergraduate degree in Political Science. Now, how many of you have undergraduate degrees in
Political Science? OK. You all know the answer to my question: What does that allow you to do? What
orientation to the real world does that give you? None…zero. It just allows you to learn something
additional. Actually, it’s a good foundation as far as intellectual curiosity, and a good liberal arts
education. But it sure isn’t training, and it doesn’t relate to the real world unless you want to become a
government bureaucrat, which had never been my idea of nirvana.
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So anyway, I went to grad school for Journalism after I had been in the Army, so I had
undergraduate, then Army, and then Journalism school. I was talking to an old professor of mine from
Journalism school, and I was saying something about what we were doing, and then we talked about
another graduate of this college, and I said, “Well he’s really a great entrepreneur.” And he said, “Well
Tom, you’re an entrepreneur yourself.”
That was the first time I’d really thought of myself as an entrepreneur, and that really helped
me. And I don’t know when each of you in this room have had this revelation that you were an
entrepreneur, but I think it was probably some time before you came into this room, and I just urge you
to think of yourself always as an entrepreneur. Not as a doctor. Not as an accountant. Not as a lawyer.
Not as a small businessman, small businesswoman, consultant, anything. Don’t define yourself as
industry-specific or training-specific. You are an entrepreneur, someone who seizes opportunities in the
marketplace, and serves those marketplace needs, or your customers’ needs. And you will be much
more flexible.
And so fortunately, I think ever since the Reagan era the title “entrepreneur” and
“entrepreneurial business” and “new starts” has come into a much better respect. You all remember
the 50’s and 60’s and 70’s, I mean, it was Fortune 500, corporate America, and if you didn’t have a job
there, “Oh, I’m in business for myself” or whatever… Well now you’re an entrepreneur, and you’ve been
credibility. Even the mass media recognizes entrepreneurs as the job creators.
So, I’d be an entrepreneur proudly, not just because of the name, but what it defines in your
own mind. It’s like one of Jay’s principles – define in your own mind what you want to be, and what you
want to achieve. And this helps by defining yourself as an entrepreneur. Which I sort of did, and this
very anti-business professor that I had helped this revelation. So I don’t know where you got your initial
revelation that you’re an entrepreneur, but cherish it, and leverage it.
Also, one of the things I did, was I had learned from all the mistakes of my previous employer. I
had seen him take leverage, and over-leverage his company. And every Friday, his creditors would line
up outside his door, waiting to get the small amount of money portioned out. I didn’t like living my life
that way, so I played the financial game very conservatively, and we always kept more cash in the bank
than we needed. We always – we were low on bank debt. In fact, it was easy to be low on bank debt,
because banks wouldn’t lend us any money. How many of you have had that experience? Banks not
wanting to lend you money? OK, well you know what it’s like. We heard some of the questions
yesterday, some of the comments. It’s a very disturbing experience, so if they wouldn’t lend it to us, we
had to make it. So we made it, and stashed it in the bank.
One of the things we did was realize that we were in business, and that we wanted to - very
early on, I personally wanted to work on my business, not in my business. And I think that is an issue for
some of the people in this room. Again, look in the mirror tomorrow morning, and ask, “Are you
working on your business, or are you working in your business?” You need to take that step, working on
your business – stepping back, and beginning, as I was mentioning yesterday, to delegate some of those
responsibilities so that you can work on your business, and your colleagues can work in your business.
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Basically, we continued to grow year after year by reinvesting in the company, by hoarding our
cash, always meeting our payroll. As a sidebar on this borrowing, as you all know, the very best time to
borrow money is when you don’t need it. That’s when the banks like to give you the money. When you
do need it, they don’t like to give you the money. It’s very perverse.
Now, I can say that because I am, coincidentally, a vice-chairman of the bank in Montgomery
County, Maryland. And I sit on the other side of the table. It’s very bizarre, but they want to lend you
money when you have plenty, and they know that you can pay it back. And when you really need it, and
your back is against the wall, and the latest product has just flopped – that’s not the time to go and
borrow the money.
So if you want an action – please let me ask you: Raise your hand if you do not need any bank
financing now. OK, now, each of you who’ve got your right, or left hand up, put it down, and put “To do:
Go borrow some money!”
Now, when I say that, literally what I’m saying is, go take out a line of credit. Go to your bank,
show them how much money you’ve got, and say you have wonderful plans for the long-term future to
grow, and you may need some additional bank financing, but you’d like to get it lined up now. And
indeed, what I did was I actually borrowed money when I didn’t need it, and paid it back early. And it
cost a little bit of interest, but the bank said, “Hmm. He took out a 90-day loan, paid it back in 60 days?
That’s good.” Do that two or three times, do it one-year note that’s amortized, pay regularly…and we
just took the money and put it in a different account and built up interest there, and just had the spread.
So I suggest you do that.
Because bankers do not understand entrepreneurs. Bankers do not understand entrepreneurs

because they are not entrepreneurs themselves. If they were, they wouldn’t be working for a bank, now
would they? They would be making almost as much money as you are. But banks pay very low salaries,
and banks attract, frankly, risk-averse individuals, normally.
So, go borrow money from your bank. Make them – some of those bankers are happy to lend it,
especially when you don’t need it, and they’re very happy to get the interest. So I really would suggest
you go borrow some money. And that, of course, begins to build your rapport with your bank, too.
And so I’m being a little facetious about this, but the more he gets to know you, and about your
business, the higher the comfort level of the banking lenders and the whole banking establishment will
be, because someday you may really need them. If you have a turn for the worse, or you need some
expansion capital, or whatever.
So speaking with my banker hat as well as my entrepreneur hat, please try to borrow some
money. Do it within the next 30 days, and do it because you don’t need it. Sort of counter-intuitive, but
some of you, I’m sure, who have been through the experience, it will resonate with you.
OK. We heard yesterday, and I think we all know, what Fran Tarkenton said is so true, that you
grow through adversity. And we kept growing and reinvesting in the company. As I said, I didn’t take
money out of the company; I poured it back in. The people that we attracted knew that’s what we were
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doing. It was for their benefit, as well as the company’s benefit so there would be further opportunities
and job security for them.
But then these darn things come out of the clouds and hit you, or blind-side you. And we’ve had
our number of battles and adversities, and a number of them have involved the government. “I’m from
the government, and I’m here to help you.” Well, we’ve heard that a couple times, but one time we
heard it with, “I’m from the government. I’m from the SEC, and I’m here not to help you, but to inspect
you.” And then we had something from the Federal Election Commission, because we had a political
newsletter that started attacking Teddy Kennedy, and maybe that wasn’t prudent, but it was what I
believed in, and so Teddy Kennedy sicked the Federal Election Commission on us, and so…
You know, when you’re in Washington there are all sorts of strange things that go on, but also
when you’re out in the rest of America, the government intrudes too much in your lives and your
business, in my opinion. So anyway, I think that what you have to do is be prepared for these
adversities, but after defeating the SEC in federal court, and the FEC in federal court in battles that most
people would have just cut a deal, we felt a lot stronger internally. And so when we had business
problems, we said, “Well, if we can defeat the entire federal government…” We had this SEC case when I
was, then, in my basement…! I mean, the SEC inspector came and knocked on our door, like the things
you hear about in the middle of the night, in the Nazi era. Well, it was very similar, from my perspective.
But when the organization came through that and defeated the whole SEC, which the Merrill Lynch’s
don’t usually do. They’ll cut deals. When you achieve that, you get this great self-confidence and
determination, and you have built this stronger defense, and you have a lot more drive inside.
So, do turn those adversities into advantages, and realize from these battles you will become
much, much stronger. And that’s what we did. We even had our last legal battle was when one of our
editors criticized National Life Insurance Company of Vermont, and they were having a big PR campaign
going on at the time, and they didn’t like our criticism. So they thought, “We’ll squash this little
publisher company, down in Maryland.” And they sued us for $50 million – actually it was $53 million,
excuse me. We were sued for libel, for $53 million. And they wanted us to cut a deal, but we stood by
our editor, or our writer, and said, “No, he was right – you’re wrong. Let’s go to court.” So we won in
court again then, and they basically had to retract the charges, and so forth.
But that’s pretty scary. Although, you know, it wouldn’t have mattered if it was $53 million, or
$5 million – it was too much money. And so $53 million gives me just that much more indignation to
fight it, you know. Being sued for $53 million – well, OK. We beat them too.
All these things, we got additional strength from. And I would urge you to get additional
strength from your battles, too.
How did we grow? And this is very much take home, I hope. Because there are three ways to
go – it’s very simple, it’s very basic, but I am guessing that not everybody in this room is doing all three.
But we have always had a three-pronged approach. Number one: Grow what you’ve got. Every year,
you should try to grow your present products, or product line, or whatever. We started out – one of the
two newsletters, we started with was called “The Retirement Letter.” The Retirement Letter has been
growing for 23 years. There have been a couple of years, or several years that we may have had an off
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year, but we don’t neglect The Retirement Letter. It has been a foundation of our growth. Don’t neglect
your stable of present products, because they often have the highest margins. You tire of them
sometimes before your customers do. So don’t get tired of your cash cow products.
Secondly, start new products. That takes R&D, it takes capital, it takes risk, it takes insights.
And they can be line extensions, or moving into a new marketplace. But start new products, without
abandoning your old. Go ahead and jump out.
We always started new products in a very deliberate way. We would do a similar form of
product, meaning another newsletter, in the investment area. That was the easiest to do. Or we would
make one jump up, but not two jumps. One jump means we do a newsletter in the health area,
meaning the common thread is newsletters. We theoretically knew how to do newsletters; we’d go into
a different marketplace, meaning health. Or we would do a directory, let’s say, or a book, or a seminar
in investments. So we would keep the same marketplace, but we would change the form of products.
We never jumped from doing newsletters in investments to doing books in health, let’s say. You should
only ripple up a step at a time, because you are much less likely to fall off the cliff, or have a mistake.
Don’t try the two steps, because then, if you try the book in health, you won’t know whether it’s
because the marketplace for health is no good, or if it’s the book form is no good. You don’t have a clue.
So that was one of the key principles that we developed, and we still do that. We’ve moved into
Business Success. As you know, this group that is working with Jay and Denis Waitley, and maybe with
Fran Tarkenton, as you heard, this is one of our newest groups. What are we working? We’re working
in the newsletter area, which we know, and seminars/conferences, which we know. We did not start in
videos on Business Success, or we did not try to start a broadcast network with a video on the whole
business success area.
And the third thing is acquisitions. Let me ask you again to participate. How many individuals in
the room have made an acquisition of some significance, or any acquisition in your company’s career?
Please raise your hands. I’m going to guess about a third of the room. There seem to be a little more
people. Most of the acquisition people seem to be sitting on this side of the room. In any case, I’ll say a
third to maybe 40% if there were some shy people that didn’t want to raise their hands, so that mean
almost half or more of the room have not made an acquisition. Let me suggest that that’s something
you should do, and I’ll give you a little bit better time frame than just 30 days. Let’s say in the next 18
months while you’re working with Jay and his team, and our organization, make an acquisition. Buy
somebody else’s product line, business, whatever, however you practice, if you’re a doctor or
professional.
Now, why do you do that? Well, because, hopefully, everyone in this room is dedicated to a
growth agenda, and you need your three legs of the stool, or three streams of growth. Growing what
you’ve got; starting new; and acquiring.
Now, why do you also want to acquire? Because that disciplines you to look at other businesses
and compare them with yours. You will learn a lot, even from the acquisitions that fall through, that you
don’t make. You will learn what you’re doing right, and what the other guy’s doing right, and what you
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should be doing that he is doing. And then secondly, it’s another wonderful way to bring aboard other
business builders if individuals come with big product lines.
Now we’ve done all sorts of acquisitions. Sometimes they came, and sometimes they didn’t.
But you’re building, not only your product line, but your most important resource, as I was mentioning
yesterday, which I believe is your team, your people. If you buy Product X, and ten people come aboard,
or two people come aboard, or 100 people come aboard, they’re all there with you to help you build
your business. So, it’s not just the product line – it’s the people too.
So, we use over 23 years, or 22 ½ years so far, the three-pronged approach. And every one of
our leaders is empowered to look for acquisitions, as well as to help with the new starts, and grow the
business we had. All of your key leaders should be participants in all three parts of the process. You
should not say, “Oh, I’m the only one who does the acquisitions” or “I’m the only one who does the new
starts.” The new starts should well up from the bottom of your organization, from the people who are
closest to your customers, and your marketplace, because they will know what new starts you should be
making, probably better than you do if they’re closer to the individual customer.
And then the acquisitions, they will also know the skinny on the street. I don’t often know
who’s doing well, or who’s doing poorly among our smaller competitors, but the individual reporters,
editors, writers, marketers who are interacting with the other businesses in our industry know exactly
what’s going on. You know, it’s the talk over the beer at night. It’s the talk at the trade show. It’s the
talk on the phone, when you’re exchanging marketing ideas. So, get those ideas from your own people,
and empower them to be part of the acquisition progress.
OK. I told you I’d give a quick summary, and I’m hoping this is it. I’ve tried not to tell you all the
mechanics of how you start a newsletter, a magazine, a directory, online services, seminars,
conferences, the whole – trade books, tabloid newspaper. We have all those products. But that’s less
important, what products we have, and more important is the process.
But where did this process lead us? Now, in 1996, 22 ½ years later, what started in my garage -
with myself, a part time editor, a part time secretary, and my wife working part time on that, and part
time as a homemaker and raising our children - has now become over 900 employees with the same
$1,000 investment. There has never been any additional capital paid in to Phillips Publishing
International.
And not only do we have 900 employees, but more importantly, we have 3,000 family members
who draw their sustenance every day from our company. And that is the biggest reward I get: knowing
that when these families sit down at dinner, each one of them has had a better life, a little bit better day
because of our company; a little bit better opportunity than they might have had at the next company
down the street.
I won’t get into some of those things – why I think it’s better, but I think of not only employees
at the job, but I think the totality of their 24 hours a day, their 7 days a week, and their family at home.
Whether they’re married or not, they’ve got family. They’ve got sisters, brothers, fathers, mothers,
aunts, uncles, nephews, nieces, and in many cases, their own children.
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But we have 3,000 members of our family. As you heard yesterday, we closed our fiscal year on
Friday with over $225 million in sales. That’s up slightly from the $300,000 we had the first year. And
I’m really happy about that, but I’m happy about that because at the 225. We’re still small business on
our way to being big. And when we hit $300 million, we will still be a small business on our way to being
big. And if we ever hit $1 billion, we will still be a small business on our way to being big, because that’s
the way that I always want to think – that we are, indeed, the David vs. Goliath.
It’s wonderful to have Rupert Murdoch, Time Warner, McGraw Hill and all out there - not so
much as role models, because we don’t want to imitate what they do, but as targets, as opportunities.
As I always say, Time Warner, our future subsidiary, did this today… And I say that at the office - and we
all laugh, as you did, but then - you know, someday, it may not be Time Warner, but so-and-so, our
future subsidiary. And some things have become our subsidiaries, or part of our team that I have just
dreamed about in years past.
One of the nicest things happened to me, and to show you that the employees do keep track of
things – we hit the $225 million, and there was a little celebration that a couple of my colleagues had
arranged for our final management meeting for the day. And they handed me a press release that they
were sending out, without my even knowing it that day. And the headline was “Phillips Publishing
International Achieves $225 Million Sales Year, And Passes the $1 Billion Mark in Lifetime Sales.” That
made me feel really good. $1 billion over 23 years – I hadn’t even been keeping track of it.
Now unfortunately, this was not “Passes the $1 Billion Mark in Annual Profit”. It was just the
sales. But I encourage you, when you think you have a relatively small business, to go back and add up
all the sales you’ve made from Day One in your business. And boy, if that doesn’t give you a sense of
accomplishment…Because each one of those sales dollars has affected your customer. Had you
delivering value to individuals. You have made their lives different.
All the employees you have ever had, you have touched. We have 900 now, but I would guess,
over time we might have had 1500. I’ll have to go back and add up the number of employees that we
affected. And if you believe as I do, that we are placed on this earth to make a difference, and make a
positive difference, and leave the world better off than when we came into this world, you’ll get a great
sense of accomplishment. And that will refuel your energy cells to go on even farther, and jump out of
bed the next day, as excited as you were yesterday.
It’s the process, of course. It’s the journey that’s so much fun. You know, if you’re driving from
Washington D.C. to California, you want to enjoy it. And then, when you get to California, what do you
do? Well, you can’t drive to Hawaii, but maybe you drive to Alaska. And you just keep setting different
goals for yourself. But while you’re on the journey, that’s the fun of it all, and the numbers are just
benchmarks. And along the journey, you’re affecting a lot of people, and hopefully, for the good.
Hopefully, very positively.
So, how did we do all this? That’s a little bit of the history, and you know, as I said, I’ll take some
questions later, and I’m sure Jay’s going to shoot a few at me, but – how did we do it? What was the
secret of the success? What was the secret of why we did it and other folks in our industry did not?
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And I think it comes to the second topic that I said that I’d talk about, and that is the recruiting,
motivating, and training of key business builders. In a word, people. The people that we attract into our
organization made all the difference in the world, because that’s what your organization is. It is key
individuals tackling a common goal. They are your keys to success, also.
We haven’t talked too much about people. We’ve talked about ourselves in this session, and
that’s very important. I think you’re the most key person, if you are the CEO, or one of the key leaders
of your company. But also, you have to then spread that. How important are your colleagues? Well, as
a team, they’re probably more important than you are.
And I’d like to even suggest that, flipping it around another way, if you got hit by a truck, god
forbid, as you leave this seminar, would your business survive? And if the answer is no, then you have
some work to do, too, because all of us, someday, will get hit by the truck. It will take different forms. It
may be peacefully someday when you’re 99 years old, or it may be that truck, or something in between.
So if you want your business to transcend your lifetime, and if you want to leave something that
is still having a good effect on the world, then you need to plan for your own succession. But that’s kind
of depressing, to think about planning for your own succession. So if I can suggest, you don’t plan for
your own succession; you plan for your own success by attracting the people who can keep you growing
while you still are alive, well, and a part of the company.
So, I’d like to repeat what I’ve said. Not only are they your future successes, but as I mentioned
yesterday, you really must empower them. It’s an overused word now, but you really need to delegate
and motivate. And I think that the excitement that you have for your business is one thing that is very
motivating. The agreement upon common goals is very motivating. You’ve heard yesterday about our
business building methods of doing a business plan each year, that is a full participatory plan, that is
built from the bottom up by your team members. That’s very motivating, when they work out a plan,
and then, they make the plan come true.
You also need to be growing yourself. I think one of the things - we’ve been talking about
moving out of your comfort zone. One of the most serious responsibilities I feel I have is to personally
change in order to meet the changing conditions of the marketplace; the changing needs of our
customers, and change and grow to be worthy of leadership of 900 people. They have placed their faith
in our team, and in me at the head of the team, and I do not want to disappoint them. I think some of
the worst things that are happening in America today are layoffs, downsizings, and firings. What does
that mean? That means that management made mistakes. You know, these people offer themselves
for employment. Many of them were doing a fine job, and the management made a mistake. If their
management had been growing, and in touch with the marketplace, those waves of layoffs would not
have been necessary, in my humble opinion.
That’s different from asking an employee who is not on the program to find employment
elsewhere – to find his or her opportunities elsewhere. I hate to use the firing word, but outplacement,
or whatever. You should do that; you need to do that, if they’re not on the program after all the
attempts for motivation, training, and so forth. But, the mass firings that some of our companies are
engaging in - it’s the management failure, not the employee’s failure.
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So anyway, I challenge myself to be worthy of leadership, and I’d like to suggest that you need
to look, again, in the mirror and say, “Are you worthy of leadership, of your colleagues, and are you
doing as good a job as you’d like to in being the leader? The answer should be, as it is with me, a
perpetual “No, I’m not doing all I can.” So tomorrow, I try to do even more, and become better. And by
constantly challenging myself, hopefully I’m keeping up with the needs of the marketplace, and the
needs of our company.
And one of the things I think you’ll find – and I think when you ask yourself about being that
leader, is that you need to be the leader, not the doer. And you need to empower your colleagues to
take the initiative, and implement. You need to be the best leader, not the best production manager, or
the best marketer, or the best sales person, or the best doctor.
I think in the professions, this is the toughest thing to do. Because you’ve been trained, not only
undergraduate, but many years of graduate school, or of professional school, whether you’re a doctor,
accountant, lawyer, dentist, or whatever. It’s very tough to say, you know, I want to take all those years,
and not drill teeth. I want to organize people to drill teeth. I do not want to practice law; I want to
organize lawyers who practice law.
Now in that particular case, I’m not sure that that is for the good of society - to get the lawyers
even more organized than they are now to prey upon the rest of us. But if you concede that they have a
noble profession, then they at least should be organized in doing so.
So I think that that’s one of the things that entrepreneurs have the toughest job doing. Realizing
that they are entrepreneurs, they are organizers, and they are leaders. They are not doers. They should
not be doers; they should not be micro managing. Now this does not mean abandonment of
responsibility. This does not mean hands off. This does not mean abdication. It means somehow that
delicate balance in leading, empowering, keeping in touch, giving feedback – it’s much harder than
doing it yourself. Let me tell you, it is much harder than doing it yourself. How many – and I will even
raise my hand – how many of you have said, even say, within the last year, to yourself or out loud to the
employee, “Oh, forget it. I’ll do it myself.” Raise your hand.
OK. Well, we all are humans, and so we fall into “I’ll do it myself.” But you must resist that urge
at all costs. It is actually easier to do it yourself than figure out how you’re going to train that individual
to do it just perfectly, the way you would want it done. That’s much harder. You’ve got to opt for the
harder way, because the second time, and the third time, and the fourth time, they’ll begin to do it
better and better, and then they will end up better than you are.
I am not the best marketer, the best writer, the best reporter, and certainly not the best
financial expert in our company. Hopefully, by concentrating on the leading - I’m one of the better
leaders of our company. And that’s what you all, I believe, need to become. Better leaders.
What key resources – after my remarks yesterday, one of the individuals said, “You told me
there were five key resources, and you only gave three.” Well, if you want to write down the five – and
I’m trying to give the take-home value – I’ll list all five.
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And number one, you all can tell me. What is number one? People – that’s the right answer.
Give yourself a star. We sometimes use the word “leadership,” even. People, or leadership. When
you’re talking to your management cadre, that is what it is. It’s their leadership. But in totality, it is the
people.
Who is one of our most important people in our organization? Our receptionist. Our
receptionist has been at our front desk for over ten years. This is not the bottom of the ladder at our
organization. This is a very important job, where this individual is empowered to interact with everyone
in the outside world, speaking on behalf of our company, and be the first interface, and the first
impression that anyone gets of our company. We pay that receptionist very well. She is a wonderful
woman. Her name is Millie. I love her. I give her a big hug. She is mature enough to realize the
importance of her role. She is celebrated throughout our company, and I think if Millie should ever
leave us, I would be crushed. And it goes on from there. Our people are just so, so vital.
Secondly – and I’ll come back to people, because all of this has been about people – but
secondly, our markets. Our marketplaces, or the word we’ve been using here is customers. Our
customer base. That is very important. We must have the right people to interface with, serve your
customers. So customers are, in a way, number two. But they are the people you are serving with your
whole team, and you should love them. And Bob King, who is my partner, as you’ve heard yesterday,
has brought us a new level of understanding about our customers, and how to treat them. And I have
learned a lot from him. He has been a wonderful teacher, and I was concentrating, you know, probably
90% of my time on our team, and our people, and I even need to be reminded to look out there to the
customers. And coming to seminars like this helps me do it, because we’re all hearing about our
customers, but also all of you in the room are our customers, and our friends.
And that’s one of the things we want all of our customers to be - our friends, our colleagues, and
have a win-win with our customers, where we’re even delivering more value than we promised, and
getting in return an adequate amount of cash to continue to reinvest in the company so we can serve
our customers tomorrow, and next year, and beyond.
The third is products – one of the things I find is that too many seminars, and too much time
within our organization, and every organization, probably is focused on the products before you go
through steps one and two with people, and the marketplace. When we don’t want to be in a
marketplace, we don’t even look at a potential acquisition, no matter what the product is. I felt that
acquisitions are start-ups. People bring us wonderful product opportunities. “We’ve got this great
widget you should publish!” “Well, is it in our marketplace?” “No.” “Well, thank you, but there’s
somebody else who has better ability to do a good job in that area.” So if you don’t have the knowledge
of the marketplace, then you shouldn’t be fooling around with products in areas, or in marketplaces you
don’t understand.
Fourth is capital. Now if this were a venture capital conference, all the venture capitalists would
think, or say to you that the capital is the most important thing, wouldn’t they? The bankers think that
capital is the most important thing. But what is this capital really searching for? The capital is always
searching for entrepreneurs to make the capital work. The venture capitalists are looking for people in
this room. And so when venture capitalists are out there, or when you’re looking for capital, if you
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should, unfortunately, need venture capital, which comes at a very high price, remember that they need
you more than you need them. Now they will not tell you that, of course. But they need people to work
12 hours a day, 7 days a week, and all they’re giving you is money. Money – very plentiful commodity.
The right ideas with the right people and the right marketplace – you know, the money will flow your
way. So don’t sell yourself too cheaply to get capital.
And then another form of capital, of course, is, as we said, the bank. Go borrow some money
now. Rates are pretty low. Get in on a long-term basis; pay it back.
And then third: remember capital from your customers. Your customers want you to succeed.
If they have the ability to pay you up front, ask them to do so. You can then reinvest and serve them
better. As we discussed yesterday, unhealthy, unprofitable companies don’t do a helluva lot for their
customers over the long term because a bankrupt company can’t serve its customers.
And finally, organizations and systems - infrastructure, if you will. Knowing the people in this
audience, I am sure none of them have made the mistake that I have seen others make, though. And
that is, you know, you want to start a company. You raise some capital, and you go out and you get the
lease on an office. You buy a lot of furniture. You go buy your computer systems. You hire some
people. And then you sit down and decide, “What’ll we do? Who will our customers be? What will we
produce?”
Now, this is absurd, of course, and I’m exaggerating in the extreme, but think about it. A lot of
people fall in love with the organizations and systems. They fall in love with the computers themselves,
as an end in themselves. They fall in love with the furniture.
I want you to know that when I started in my basement, I went to the used furniture store, and
bought a $250 desk for $65, because it had one drawer broken. And then, I got a carpenter to fix it for
$15. That was an $80 desk – an $80 investment for a $250 desk. I still like to do that type of thing. I still
like to get extra value, because if I don’t, if I mentally let myself fall into the trap of just paying the
standard going rate, as paying retail – we’re not going to profitable anymore. We won’t pass down the
right cultural values.
So number one: We still look for a good deal, good value. It was also good value for the store
that sold it to me, because a lot of the Fortune 500 companies wouldn’t touch that desk. They had a
smaller market for this broken desk.
The most important thing is, though; we still have that desk. We still use that desk. Why? For
21, 22 years now, we use that desk. I personally used that desk for a number of years, and then when
we moved to some new space, and realized I’d need a little larger desk, and I thought I wanted, maybe a
little better desk, I will admit. I passed this down to the next person in line, and said, “This is a magic
desk. There’s great success that comes with this desk, and I want you to have my desk.” And we used it
for a few more years, and then that person passed the desk on and said, “Not only did I use this desk –
and I’ve had a great career since I’ve been using this - but this was Tom Phillip’s old desk, and you are
good enough to receive Tom Phillip’s old desk.” And I think it now is being used by our
Telecommunications Manager. I hate to say that I’ve lost track of the desk, but I know we didn’t get rid
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of it, because we never throw away desks. But, the point was we sort of touched each person’s life. We
gave them a little inspiration. We also were very cost effective for the company.
I also do it another way. Any equipment I’ve got, I buy, let’s say, a new desk. How do you buy a
new desk, and make 10 people happy? Because it’s the trickle-down effect that the literal economists
forget about and deride. But the vice President gets the new desk, and he gives his pretty nice desk to
the director of marketing, who gets a new desk, who gives his or her desk to the senior marketing
manager, who gives his or her desk on down the line. Everybody gets a new desk. Everybody’s happy,
and it only costs one desk, not 10 desks.
Now, this is not apocryphal, this really works. And, you know, I’m assuming that all these desks
are still functional, and serve the needs of these individuals. But what I’m trying to also impart to you is
that the company has been successful, I think among other reasons, because as we grow large, we try to
continue to think small, think entrepreneurially. We want to be the billion-dollar company that thinks
like a $10 million company.
Now, getting back to people. This is something that I want to share with you, that I’m not sure I
fully understood the first time this guy told me - he was a very wise gentleman – when I was having one
of the battles with the government. I met him, and he was the former managing partner of J.K. Lasser,
which was a big accounting firm that merged into one of what is now the Big Six, or the Super Six. And
he gave me a piece of advice. I was talking about how much it was going to cost to hire someone. All
the money I was going to have to lay out for this very capable person. And I was sort of wringing my
hands about this expensive hire. And he said one little thing that has never left me. “Hire the best, and
cry only once.”
Now think about that, and write it down. “Hire the best, and cry only once.” When you
advertise for someone, you should hire the best person, even though that person is not the least
expensive. Even if that person blows the whole mental plan you had of the range. If that person can
deliver the value, you will wring your hands. You will cry. The accounting department will wail. You will
have to think about the other colleagues, and are you being fair to them?
But that person will repay, and build your company far, far more, with much more leverage than
being cheap on the front end. And of course, if you look at the flip side of the coin, how many times
have you cried over the mistakes that were made by a less competent person? Or a less dedicated
person?
I think that by trying to hire the best, motivate them, and so forth, we’ve ended up having a very
low turnover, and we have people such as our receptionist, as I said, with us 10-11 years. My personal
assistant and secretary, and executive assistant, executive secretary, whatever title she wants, she can
have…has been with our firm for 16 years.
Well, I’ll tell you, I wanted to hire the best, and this was after I had had a series of inexpensively
hired secretaries. I would never use the word “bimbos”, but you know, they were young and
inexperienced, and just didn’t get the picture. But I thought I was saving money until Phyllis came along,
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and I realized before hiring her that I needed to have someone who was a business builder and would
help me.
And she turned down the job the first time. But she took my offer, and went home to talk with
her husband, and she called me back the next day, and said, “My husband said that you’re not going to
pay me enough, that that’s not enough money, and so I don’t want the job.”
And that terminated the conversation for a few minutes. Now, what is the natural reaction is,
“What is a secretary going to do? She has nothing – she’s been hired, she’s dictating our salary
schedule? Well, I’ll go on to the next candidate.” And then I said, “No, no, no.” I realized that in the
interviews that we had had, we had struck up such a wonderful rapport, and I had such wonderful
feelings about what the relationship could be like, I called her back and said, “OK, it’s a deal. You get the
salary you want. I think you’re worth it. And come aboard.” And you know, in that case, I did not let
me ego stand in the way. I mean, there have been times I have, and I’ve made some stupid mistakes by
doing that. But I really think, 16 years later, “Wow, whatever it was, it was on the order of like, $3,000,
or whatever – holy cow, am I glad I spent that extra money, and hired the best.” And I haven’t cried
ever since.
And there were a lot of people like that, that we have, with really long term relationships, that
we try to get the very best, and cry only once.
OK, how do we motivate these wonderful people, once they’re aboard – motivate and reward
them? Well, you heard about the Disney trip yesterday. That was when we had what we called, “Our
Double Celebration.” The Double Celebration was 20 years in business, and $100 million in sales, our
first $100,000 year. So we took all of our employees, a spouse or significant other of theirs, plus their
children to Disneyworld in Florida for a three day weekend. 1300 people went. We chartered six
airplanes to leave from Washington. We had lots of space for people coming from our offices in
England, California, Houston, Denver, and so forth, and they all – it was like a military campaign. It was
so much fun! It was just like a prelude to the Gulf War, and you know, what Schwarzkopf did there – it
was very exciting, and it was also great business training at how to tackle a very massive project.
Logistics, 1300 people – sort of a prelude to the 500 here. We didn’t have quite as many logistics to get
this thing underway, but it was very exciting, and why did we do that?
Well, I felt very appreciative of the people who had worked so hard to build our company, and I
wanted to say thank you. I wanted to say thank you to them, but also, knowing the hours a lot of our
people put in, to other significant people in their lives, namely, a spouse or whoever they selected, and
children, if they had any. And the thing took on a life of its own.
I just went on a nice little weekend, and there have been more benefits that have flowed from
that than I could ever have imagined, and I was just attempting to give a gift of thanks to our colleagues.
I mean, not only did we get a lot of publicity externally, that now, when we go to recruit, people say,
“Oh, aren’t you that great company that took all of its employees to Disneyworld?” But the spouses, in
many cases, who have had it up to here with 8 p.m. arrivals of their spouse home, or the weekend work,
or whatever - now realize that they were appreciated, and they were included, and hey, maybe this was
a little special company that didn’t do things just the ordinary way.
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And finally, the kids – the kids had the greatest time, because they went back to their school
after the announcement about the upcoming trip, and said, “My mom’s company is taking us to
Disneyworld. What’s your mom and dad’s company doing?” And so they got all these bragging rights in
school, and it was just phenomenal, because now you had the whole family happy about Phillips
Publishing. And this is not the dreaded employer that you hate to go to work to. This is a fun place, and
they’re saying thank you. And I hadn’t realized that it would be so profound an effect, and so now, they
say, “Well, we’ve got a 25th Anniversary coming up…” I’m not sure what we’re going to do, but I want to
make it very special. And I really do.
And I think that the person who had the most fun out of the party was me, because I saw how
happy everyone else was, and that’s what turns me on. I’m very happy when I make other people
happy. And you know, life, liberty, and the pursuit of happiness are in the founding of this country. I’m
not a medical doctor, so I can’t help you with your medical life. I am active politically, and I’m trying to
work to help all Americans preserve their liberty, and hopefully, I can help on the happiness scale – both
our customers and our team members.
So, I would like to suggest that you think of something, as life goes on in your company, that you
can surprise and delight your own team members with something that is unexpected, that shows you
how much you care about them; that you really do love them. You wouldn’t take people that you don’t
love on a trip with you, would you? You would take your family. Well we took our extended family.
OK. We also have some other things that are very – less dramatic, but very, very effective. We
have something called, “Recognition Day.” OK, Recognition Day – write this one down. Now here’s a
little participatory thing: How many of you have offices, when someone has a birthday, you have a little
cake, or a little celebration, or you make note of it? Raise your hand if you have birthday parties. OK,
about half of the firms, at least. That’s the origin of our Recognition Day.
We started having cakes for everyone that had a birthday. And then, we had so many people
that it was like – you know, with 50 people, statistically, is one birthday cake a week for the whole
company, and it doesn’t work out very well. Because all you’re doing is, every week, it’s another cake.
So we decided to group them into once a month, and we’d celebrate everybody’s birthday on the same
day for that month. And it became known as “Cake Day.” And Cake Day – we started recognizing
people, singing, “Happy Birthday to You.” “Oh, and Jim, we also want to recognize you because you had
your 5th anniversary with the company. Come on up, Jim; let’s give Jim a round of applause. And Jim,
say something about your five years.” Hey – and then next month there was another Jim. So then it
became two things: birthdays and anniversaries.
Well, we were recognizing an achievement, an achievement of five years, or three years, or

whatever number of years at the company. And then, we had some new members of the team
attending this Cake Day one time, and it was “Hey, let’s bring Suzy up and introduce her. She’s a new
member of the team.” So Suzy comes up. “Hi Suzy, welcome. You are our new Marketing Manager.
Say a few words.” Suzy’s petrified. My God, she did not expect to be called in front of the whole
company on Cake Day, and told to give her little bio.
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Many employees are not as self-confident as everyone in this room coming to the microphones,
as you may have noticed in your own company. But Suzy got through it all, and then the next month we
offered the same opportunity to Jane, and Jim, who came aboard, or Steve, and Bill, or whatever – so
then we had a third thing.
And then finally, one time somebody got promoted to Vice President, and so on Cake Day we
said, “Come on up, Dave. We want to give you a round of applause, and we want to recognize you for
being elected Vice President of the company.” So we had a fourth thing.
Well, what do you know? We said, “Wait a second – we’re putting the wrong emphasis on this.
This gathering is not about cake. This gathering is about recognition of people.” So we actively changed
the name of the day to Recognition Day, and sort of banned the use of Cake Day, because we wanted
the emphasis to be upon the recognition of our colleagues.
Well this is really a bonding experience, whether it’s someone that’s celebrating a 10th
anniversary or not. And during the anniversaries, another thing we do is we recognize with something
tangible. On the 3rd anniversary, I don’t know if you’ve seen many of our team members. They are
often wearing this little pin that says “PPI.” They’re not required to wear the pin – they want to wear
the pin, because they’re proud of being part of our team – at least, that’s what I’d like to think. I will
say, you get promotions if you wear your pin.
JAY: Stop, stop – I don’t want to interrupt, but I want to ask an “out-of” sub-comment. Take a
moment of your time. You talk about the incalculable leverage of having people on their own, wanting
to work harder, care more, because of the pride, and the connection, because they think that – you’re
probably going to say it, but I think it’s so important that people see the exponential leverage in each
facet of what you’re talking about. But I don’t want to assume that they’re going to get it subtly. Would
you mind?
TOM: Yes, these people take our company as their company, which it is. And I’ll talk about
compensation, and sharing equity, and all that in a few moments. But they are highly motivated,
because they want to do well for the company and for themselves, and they are proud of being part of
our team. So one of the things we do is recognize that at Cake Day – and I suggest that you develop a
lot of symbols that have very important meanings – sort of spiritual meanings. This is a symbol, the PPI
Pin. And you get an initial pin, and after three years you get a pin with a little ruby on the dot for the “I”.
After five years, you get a sapphire, and after 10 years, an emerald, and at 15 years, a diamond. And it’s
just symbolic, but it symbolized, somewhat.
The uniform of the military understands symbols very, very well. And I think we can learn a lot
from them. Do not our colleagues in uniform who are defending our nation, risking their lives for our
freedom – don’t they have pride? Are they not highly motivated, would they not die for their fellow
citizens? Of course. And they are recognized, not through compensation, as we all know. I mean,
modest compensation. And not for wonderful opportunities in the civilian world, if they get out. They
are recognized for excellence with a number of intangible, spiritual things that are symbolized by
ribbons or various ceremonies.
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So I would urge you, even as a small organization, not to forget the ceremonial things, the
symbolic things that are so important to us, as individuals.
So anyway, so we have Recognition Day. And Recognition Day has taken on a life of its own, and
it’s a fun time, and it is a bonding experience. Now everybody sort of slips the word to new employees
that they’re going to have to get up and say a few words, so it’s not quite so traumatic, I think. Of
course, sometimes when you’re warned about a problem coming up, it’s worse than if you’re called
upon.
But it goes very well, and it takes about an hour every month, and it’s a really good experience.
It’s a communication experience, also, across the company. So I recommend, if you’ve got a Cake Day
going now, that you turn it into a Recognition Day.
OK, compensation play – we started early on paying, as I was saying, hopefully more than the
going rate. We’d like to pay a little bit better, because we’d like to get a lot better. But then we’ve put
in a very good health plan and all the usual things like that, and then, when we were relatively small, we
started a profit-sharing plan, an IRS-qualified profit sharing plan. Now, we define our contribution as a
percentage of our profits are put into the plan every year, not a percentage of the person’s salary. And
the IRS will allow you to put in up to 15% of a person’s salary into a profit sharing plan.
A personal recommendation of mine – never define the amount of contribution as a percentage

of their salary. Always define it as a percentage of the company’s profit. Why? Because that’s where
the money comes from, the profits. Not because they have a salary, but because the company was
successful enough to make profits. You need to tie your colleagues focus on the health of the company -
not, as we were hearing earlier from the stage, not on an entitlement to a job they have, and therefore
it’s partially an entitlement.
We also, then, have a bonus plan, where you have an effect on the company; about from the
middle ranks of our management team all the way to the top, there’s a bonus system. Or another way
of putting it is, from the top all the way down, as far as we can stretch it, when people can have a major
swing effect. We have annual bonuses. They’re calculated on results quantified in advance. If you
achieve this much more profit or sales than last year, you will get this bonus as focusing.
Finally, we have now a stock option plan. When you become an officer of the company, you are
then eligible for our stock option plan. And that is a major step in your career, when you become an
officer of the company, and we take it very seriously, and so do they. And then, the stock option plan,
which I can’t go into the details, does share the growth of the company with our colleagues who are
making it happen. So that seems to be fair to do, rather than hold it all with the President, or the top
management of the company.
Finally, we share a lot of the financial details with our people. I recommend one technique. See
this? This is called our Green Sheet. This comes out every day showing what the sales for every single
product in our company were that day. By the end of the day, the accounting department adds up all
the money that came in, makes a Xerox copy of this, and sends it around. And then at the end of the
week there’s a cumulative roll-up, and it’s compared not only what we took in this day, this year – but
compares it with last year, so you can make progress. And this is sort of a report card on us. How are
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we doing? Hey, we’re doing well…And indeed, this one that I have in my hand is actually our roll-up for
the whole fiscal year, ending last month. We’re 32.2% ahead in sales this year over last year. And I can
tell you each and every product.
Well, what does this do? This is a top management information tool, but it is also an
empowerment tool, and a communication tool to all of your employees. Why is it on green? Money – I
heard it over here first. You want to teach your people that money is good, and that the better the
company does, the better they will do.
So this is really – now we’re sharing a lot of information. Most companies don’t show all their
employees each and every sales dollar. And then at the end of the month we also share with our entire
management team and anyone who is involved in the direction of the company the bottom line, too.
The financials go out to about 100 people in our 900-person company. So there are no big secrets about
how profitable a product is, or whatever.
What does that do? Well, if you’ve got an unprofitable product that’s highly motivating, you
want to fix it so you can be with the rest of the guys, and be doing well, and if you’ve got a wonderful
product, you don’t have to brag about how well your product does. You can be very humble, because
the Green Sheet is bragging for ya!
Finally, we have an annual report. Why does the company have an annual report? An annual
report, because it is a reaching out communications tool. It tells what happened the last year at the
company, and it’s very people-oriented. I’ll have one up here afterwards, if anyone wants to see it, but
it tells our values. For instance…
JR: You’re a closely held company.
TOM: Yes, yes, we’re a closely held company.
JAY: You don’t have to do this.
TOM: Yeah, I don’t have to do this, and we’re not a public company. We do not have to do an
annual report. The only thing that this is missing is the bottom line, because for competitive reasons we
don’t necessarily want all of our competitors to know exactly what our profit margins are. But there are
all sorts of neat things that I would suggest each of you do what would be your equivalent of an annual
report. If it’s a corporate brochure that you update annually, fine. If it’s a literal annual report, fine. But
we talk about our values in here.
And what this does, is this is great for our bankers. It gives us legitimacy there. It’s a great
communication tool internally, and more importantly, it’s a great recruiting tool. When somebody
wants to come and learn about your company, you give them the annual report. You tell them what
your values are, you show them the bar chart of your growth, and you show them pictures of many of
your employees.
The name of each one of our 900 employees as of June 30 of each year is printed in this annual
report, because we say thank you for making this possible. And it is something so that each and every
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employee can go and say, “Hey, my name is in the annual report.” You know, IBM doesn’t put the name
of each and every one of their employees in the annual report – they never could do it. But I’m pledged
to do that. As long as there is enough paper in the world, we’ll keep expanding this annual report to
keep the names going.
It also tells our product line, and groups things. It’s a wonderful…it shows our outside
directories, which we have. It’s a wonderful thing. I’ll leave one up here for people to peruse if you like,
and indeed, if you are interested I would be happy to send you a copy of our annual report because it’ll
do two things. It’ll give you ideas for your company as well as giving you some more specifics about our
company, and answering some questions about our company you might have had.
So, I’m going to suggest if you would like a copy of our annual report, which is sort of the story
of Phillips Publishing for almost 23 years - please at the end of this session, come on up and give me
your business card, and I’ll send it to you within the next 10 days, when I get back to Washington.
So. Those are some of the highlights. I hope those have been practical suggestions.
JAY: Wait a minute. Can I wrap things?
TOM: Sure, you wrap for me…
JAY: Well, I wanted – the first thing, before I wrap – I want to know how much time you’ve got.
Be realistic.
TOM: How much time do you want, Jay?
JAY: Well, I wish we had four more days, but… Here’s what I want to do. I want to ask you a
few general questions…
TOM: OK.
JAY: This gentleman stood up, so I want you to – you’ll get to come back, but I want to have
each group, in a minute, discuss the biggest single question as a group you could ask. But I want
leverage. I want leverage. I want to get everybody getting the best universal answer that everybody
can gain from, so we all get leverage. But I want to ask you a couple things.
TOM: OK
JAY: First of all, this is very interesting. Mac was pointing out, if you took my – you know my
three-way business model. Wouldn’t it be incredible if you took my three-way and your three-way…
because they’re different; the exponential implications of that are quite profound. Have you got any
comments about that?
TOM: Yes.
JAY: Could you share at least one?
TOM: Well let me think it through. Um…you share

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JAY: Let me ask you a different question first.
TOM: OK, sure.
JAY: You just spoke for an hour – a gracious hour – whatever, 14 hours, whatever you spoke for,
a very profoundly rich period of time. It was wonderful. We appreciate it. You’re getting ready to leave
when we’re done with this. You’re in your car going back to Newport, or wherever. There’s one
overriding desire in your mind, in your heart right now. It must have been when you made these notes
last night – is there an idea that you want to walk out of this room leaving us aware of, and acting on –
one, more than anything else you talked about now? What is it, please?
TOM: The vital importance of your key colleagues, meaning people. That’s what drives
everything, and we tend to forget that.
JAY: Good. That’s good. One of the things you said, and I want to get you to comment
differently – I’ve always believed that capital was not really hard to get. Most people sell out their
everything, including their integrity, to get capital. I always found that money was not hard to get, but if
you sold out your integrity, it was almost impossible to get back. Would you like to comment on that for
a minute?
TOM: No, I agree 100%. The money will flow from the ideas.
JAY: Or the equivalent.
TOM: Yeah, the money or the equivalent, right. The capital, the ability, will flow from the ideas
and the values. There was a gentleman who spoke yesterday – I can’t remember who it was - who
talked about the fact that he went out…it was the dentist…who went to 21 banks, and finally the 22nd, or
whatever, gave him the money based on what they say in banking is the “Four C’s”. One of those C’s is
character…
JAY: Yes.
TOM: …Believed in him, believed in his integrity, more than anything else. That was a very
smart banker. And that’s – if you go to the right places, the capital will flow, even to integrity.
JAY: Well, see, I believe – you’ve known me for a long time. I’ve been divorced a number of
times, and wiped out to the tune of millions, and it’s no great – it’s public knowledge. But I’ve always
been able to get anybody to finance, because my ideas…
See, I think ideas and action, those two together, and there’s maybe a better word, are the real
commodity of wealth building in today’s society. You may want to…
TOM: And ever more. We are so lucky to be entrepreneurs now, because in the old industrial
age, you needed capital first to build a steel mill, or whatever. You might have a great idea, but you did
need the capital.
Now, it’s intellectual capital, if you will, but it’s the most important…
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JAY: That’s exactly right.
TOM: Intellectual capital, to use that phrase – that’s the most important thing. And from
intellectual capital – meaning people, and their ideas – will flow money capital.
JAY: Absolutely good. OK, now you’ve got some great ideas, and you reverse-engineered. You
started with the end in mind, and that’s one of the 50 people that I interviewed who were really
profound thinkers, and people that I learned from, and my own vision. Most of these people started
with a very clear picture of what they were trying to get, and they worked backwards – what had to
occur – and broke it down to little steps. And that’s astute, but what do you do if you don’t have this
culture - you’ve got 50 or 100 employees? How do you retrofit quickly and effectively and honestly, not
just superficially?
TOM: You can’t do it quickly. I’m sorry.
JAY: OK, well how can you do it? I’m just asking the question.
TOM: OK, you can do it effectively. You need to do it step by step.
JAY: What’s the first step?
TOM: The first step is: Know where you’re going. Now let me say…
JAY: What does that mean? Clarify what that means.
TOM: Oh – you know your values, and ultimately where you want to go. Let me give an
example, if I may.
We have made a number of acquisitions. We talked about that earlier. Sometimes the acquired
company does not mesh well with your culture. Well, increasingly, we are not making those
acquisitions, because it’s very difficult to change the culture.
A recent acquisition was made, not just because we wanted to be in the marketplace, but we
were so much in synch with the values of that company – and you know who it is – Doug Fabian, The
Fabian Organization. They are a wonderful organization. The shares are values like this. And we’re now
going to share each other’s business techniques and ability, but we have common values, common
goals.
Now, if you come into a situation where your own company now, or a company you want to
acquire – let’s say there are ten employees. What you need to do is gradually make that shift. You just
can’t fire all ten – you don’t have a business yet. But what happens is, when Sally quits to take another
job, and Sally wasn’t a star performer, and was one of those people who was always whining or
complaining, you make sure that Sally’s replaced. So one by one…
What the point is, suppose you even had eight out of ten of your employees who were negative
– you know, negative thinkers. So it’s four to one. So one person leaves. Then it’s only seven to three.
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JAY: Yes, great analogy.
TOM: And then, now you’ve got six to four, and at the time you got even – put it this way. By
the time you’ve got a majority, top management doesn’t have to worry about enforcing standards or
whatever…
JAY: I agree, I agree.
TOM: Our company – the people who are not fast growth achieving people feel very
uncomfortable. Because they’re hanging around with…
JAY: They either rise to the occasion, or they purge themselves.
TOM: Exactly. I thought Fran Tarkenton, yesterday – I hope you all listened. The – winners
want to hang around winners.
JAY: Yup.
TOM: And you should hang around a winner to learn. But also, losers feel very uncomfortable
around winners. They opt out. You don’t have to fire them.
JAY: That’s great, great point. I’m going to add something…I’m going to try to interpret,
embellish, and then ask for validity, or invalidating comments from you.
On the concept of acquisition, I would submit – and Tom may argue with me…not argue, like,
but he may take a different perspective…that you have a number of strategic interests in mind. Number
one is, it’s a fit for one of a number, or a combination of reasons. Added profitability, the ability to
integrate it into your facilities – some profound human capital there that can be used in other things
you’re doing…technology, whether it means high tech or low tech, that can be used or expanded on
with your nuturement, or your intellectual, human, or financial capital or distribution. You’ve got to
question all those things.
Number two: Don’t think you have to have a bucket full of money to acquire something. There
are a lot of businesses out there that are struggling to make payroll, and there’s no one else that would
buy them. You’re doing them one of the most benevolent services by letting them come into your
infrastructure.
Number three: Some people would actually pay you. I paid once to sell one of my businesses to
KCI, because there were certain consequences that were more advantageous to me. Give them some
thoughts on that. I just want to expand. Do you agree?
TOM: Sure, no, I agree 100%. If you want to acquire something, you don’t have to have a whole
lot of capital. You might say to an individual, “Look, we’ve got a great company here. I want you to join
the team, and I want you to bring your company with. And here’s the deal.” (And we’ve made this deal
many times.) We’ll buy whatever the terms are, 80% of the company, and you keep 20% of the
company. You keep that 20% for five years, and then if you want to leave…
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JAY: You get the formula going in?
TOM: Exactly – formula going in. And then if you want to leave, we will pay again, and in the
meantime, we will have grown that part of your company, or that product line, or whatever – so big,
that you’ll get a double payoff.
JAY: That’s right.
TOM: Well that’s great for the selling party, because he or she has a job, an opportunity for five
more years of growth personally, an opportunity to cash out at the end – a double hit.
JAY: Compound, tax-deferred…
TOM: Exactly, exactly. And it’s also good for this company, because you’re only putting up 80%
of something, but most importantly, you’re getting someone who is highly motivated to keep that
company growing.
I’ll be very candid with you. We now are looking at an acquisition in the UK. And the sellers are
two entrepreneurs who want to sell, but keep working there, and not have a variable incentive
depending upon success, for the next two years when they would work there.
What do you think my answer was to that proposal? NO. Because I want – they sincerely
believe, I mean, these are wonderful, honest people. They are Brits, though, so they’re not very risk-
oriented, you know, in many cases – and pardon me for any Brits who are in the room…
JAY: I want to interrupt a minute. Explain what security really is. What’s security? Because a
lot of people have this delusionary definition of security, and really, it’s germane. Their assessment of
what security is, is…
TOM: Yeah, well they think security is something that is fixed. And they are – I’m not sure if the
word “security” is…
JAY: Well, give me a better word.
TOM: All right, let me say this: what they wanted to do, is they wanted something for sure, they
wanted it secure, fixed, whatever. But I realized, though they’re honest people – and they really think
they will work just as hard in the next two years…
JAY: For no incentive.
TOM: For no incentive. Because – they’re wonderful people. But I know that’s not the way the
world works. If I were to sell my company to Time Warner, I don’t know that I would have quite the
passion if everything were fixed. Not because I need the money, but just because – you know, the
incentive, the excitement, and so forth…a lot of that would be gone for entrepreneurs. Now this is not a
corporate – Corporate America, you know...
JAY: No, I understand, I understand.
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TOM: It probably doesn’t matter one way or the other. There’s not much incentive going there
anyway. But for entrepreneurs to sell out, and not have an ongoing incentive – I wanted it. I wanted
them to do extremely well.
JAY: Better, even. Absolutely.
TOM: I want them to make tons of money. I learned this from you. If we can help them do
well, the company will do well. Everyone will do well.
JAY: I agree. Sounds good.
TOM: Anyway, so I had to say no, and one of my negotiating managers couldn’t quite
understand why, because the deal was a pretty good deal, but… And he said, “No, no, these people are
going to work hard, they’re proud of their business…” Yeah, but you’ve got to understand human
nature. Human nature, especially for entrepreneurs.
JAY: Now, a couple more, and then we’ll go to the audience. Now, this is a tough one, and it’s
not meant to put you on the spot, because I think you have a good answer, but… you’re advocating
acquiring fixtures, fixed assets, equipment, etc., at good values. I want you to clarify, because we’re
teaching people how to maximize their situation, but a lot of these people here are vendors. So I want
you to reconcile that with – there’s some interesting, not disparity, but I want you to deal with it.
TOM: Well, I think you said the key thing: good value. Leverage with every purchase. In other
words, we are now spending… first of all, I wanted to be in a non-capital intensive business. Why did I
want to be in a non-capital intensive business? Because I didn’t have any capital. And so I wanted to
play to may strength… The ideas, and so forth, was what I had in my head. So I had to make that $1,000
work very well.
Well this year, on a $250 million plus budget, we’re going to spend $5 million on equipment -
capital expenditures. Now, I think in some ways, that’s a small percentage of our total volume, but on
the other hand, I think, “$5 million – that’s a lot of widgets and computers, and desks, and so forth!”
JAY: A lot of Stick-ems.
TOM: Yeah – oh my goodness. This is just too much. But what it is? It’s a whole new call
management system for our 800 number. It’s a whole new system for our accounting. It’s a whole new
telephone… I mean, all this stuff, when you’re going, that you just seem to need. Every new employee
that comes aboard needs the PC, the set up - $5,000, boom, out the door for every new employee.
JAY: How do you reconcile yourself with that?
TOM: Well, I realize it is a means to an end of success, and therefore it is necessary. What I just
don’t want to do is have our people fall in love with it as the end. In other words, the MIS Department
should not run the company. The MIS Department should help the business builders run the company
by supporting them. People who fall in love with their capital…
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JAY: I understand. I have one more question, and this is a reverse one. What do you think they
should get out of this process, and out of me, more than anything? Because you are my publisher, you
and I have had a very interesting relationship, directly and indirectly. You’ve experienced most – and I
laud you for participating at the level, and taking notes at the level. What do you think they should get
out of this, or they should see this as? And I’m not talking about me, but if they can see me vehicularly
as a catalyst, that’s good.
TOM: Well, maybe three things. Number one, the phrase has been used here so often. Think
out of the box, or what I would call, think creatively, non-conventionally, non-linearly, and the reverse –
the contrarian thinker.
JAY: Can you tell them why?
TOM: Well, because that’s the way to profits, fame, success, happiness – when you’re small,
you can’t do things that the big guys do, just to get big. You’ve got to change the paradigm, change the
rules of the game. And that’s so much fun, as well as being successful.
JAY: It is, isn’t it?
TOM: It is, it’s just great. I will not become McGraw-Hill by doing the same thing, and imitating
McGraw Hill. I have to out-think, out-smart, and do things almost opposite. It’s like contrary investing –
you know, don’t go with the crowd. Listen to your own insight.
Alternative health – I mean traditional health these days… I don’t want to get into too many
other subjects, but you know, traditional medicine is intellectually bankrupt now, and good health, as
Denis Waitley was talking about – vitamin supplementation, behavioral modification – that’s the way to
go. But where is all the money being spent in this country, by the government, and all the institutions?
On old, traditional health.
So, you’ll never get well by thinking the old ways, and you’ll never grow your company by
thinking the old ways. So that’s the one thing.
Then secondly, I think one of the most important things that you will get from this conference is
the feeling that you are not alone. How many of you have thought, during troubled times at your
company, or when you are the only one thinking the way that you are thinking, and you just can’t
explain it, or get the other people to catch on, that you’re alone. And you think, “Am I crazy? Or is the
world screwed up? Is the rest of everybody else screwed up?” You are right. And the nice thing about
this thing is, you will remember that there are 500 other people from all across not only this country,
but other parts of the world who have gathered together, and share many of the same goals and values
and vision that you do, and that you are right. And that this is the right way, and I’m sure you will draw
strength from that forevermore.
Attendee: My question - or my table’s question is, How do you identify, and what process do
you use of knowing when you’ve found the best person?
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TOM: Well, we do very extensive interviewing. I look for certain things on the resumes.
Number one is achievement in his or her career, and number two is education, because education is
achievement. If you’ve gone through the routine of getting a very good education, you’ve believed in
yourself very early, you’ve got intelligence, and so education is important. And you know, good schools
of formal education is one thing, but also the layers of, have you been to the Jay Abraham seminar?
Have you been to the direct marketing school of this? Or what have you done to self-improve? And
then what have you achieved? Have you been with a winner organization, or have you been with a loser
organization? And how often have you changed jobs? We have a long retention of people. If they’re
early in their careers, it’s fine, you’re sort of shopping around to learn what you’re good at, or what
you’re not good at. But those are some of the key things.
JAY: Any - not trick, but any pivotal questions that you ask that are so revealing that most
people wouldn’t think to ask?
TOM: Well one is, if you didn’t have to earn money or work for a living, what would you do?
And then, they really tell you. And the right answer is, “I would still want to work for your company.”
But the wrong answer is, you know, you’ve had people come in and say, “Well, I can’t wait till I earn
enough money, because then I want to quit, and I want to go to Alaska and live with the Eskimos” or
something. There is somewhat of a disconnection between their life goals and the business goals, and
they should be in harmony.
JAY: And there’s a point you’ve got to make. It’s not fair to them, as well as you. Part of this is
not self-serving or manipulative – you’re not doing them any service if you don’t put them in a situation
conducive to what they want.
TOM: Exactly. They will be unhappy.
JAY: Exactly.
TOM: And I do not want people to be unhappy.
JAY: That’s great, OK, thank you. OK, now, back to…
Jerry Sharum: Tom, my name is Jerry Sharum. I’m in the supply business. They asked the
question that I was going to ask, but I want to take it one step further. In addition to doing interviewing,
do you do any kind of personality testing?
TOM: No. Maybe we should, but we do – we learn the person’s personality through a series of
interviews. We’ve talked about whether we should do these standardized tests. I don’t know that
they’re – it’s not a policy decision, it’s just that we’ve never got around to it. I’m not opposed to them.
JAY: Can I make a suggestion? I think he actually gets a very good feel for their psychological
makeup by the self-induced pressure they put themselves in, because their interview process is not
predictable, really, is it?
TOM: Right.
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JAY: Sometimes they’ll see you every two weeks, sometimes it might be – I think you do that,
perhaps, strategically on purpose to see how the prospect is. You’re evaluating, and contemplating, and
formulating what to do with them or the division. You’re also watching how they respond to a more
contemplative process.
TOM: Right, exactly. And how much tenacity do they have, how much patience do they have,
determination…
JAY: And whether they really walk their talk each time.
TOM: Right, exactly. Also, you know, some multiple interviews over multiple days with multiple
people, and then, you know, when you gather all the information back, if somebody’s telling you a line
eventually it shows, because they’re all over…
JAY: They breach somewhere. OK. Good.
Steve Wyles: Yes, my name is Steve Wyles, and I’m an opthamologist. I would like your
recommendations, please, on how to introduce the concept of sharing the profit and loss with your
employees when, for the last 25 years, that hasn’t been done.
TOM: Oh, you take the next time you would do an annual review, however often you do it –
every once, or one month, or on their anniversary. But you would say, “My opthamology practice has
had a very good year, and I want to give you this bonus, and say thank you for helping make it a good
year, and here’s the $1,000, or $10,000, or $200 – whatever it is. I’m going to be setting up a program
for the coming year, and I’m going to set aside X% of the profits. I’m going to share it with you and the
other employees at the end of the year. And if we have grown our profits from $100,000 to $200,000,
or whatever the numbers are, I’m going to share this portion because I value you, and I know you’re
making a contribution. I want you to know ahead of time, and I want you to be empowered to help us
do that.” And then a year from then, I would guess that if you’ve got the right people aboard, they will
have helped you share your practice, and they will share in it. And they will be happier, you will be
happier, and everyone is a winner. You’re a winner, they’re a winner, and your clients are winners,
because they’ve gotten better treatment, more attention, more customer-friendly, patient-friendly
service because the individuals care more.
JAY: Thank you.
Attendee: You were talking about how you compensate people with profit sharing, and what I
didn’t understand is how you can do that without it being a reflection, or a percentage of their salary.
And we talked at the table there, and people had a few ideas, and a few models of how it’s done. And
some of them seemed like…
TOM: All right, I’ll tell you the mechanics are you take a percentage of the company’s profits.
Say, oh, let’s just take an abstract number. Say we had $1 million in profit, whatever company it is, and
you say, “I’m going to give the employees 10% of our profits.” And so you take $100,000, and then you
divide it up among employees as a ratio to their salary, and it turns out to be a percentage in their
minds, perhaps, or it’s two week’s salary, or whatever it turns out to be. So it’s related to their salary,
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but it comes from a percentage of the profits, plus, you don’t define it as a percentage of their salary.
Some of the profit sharing plans say, “We will pay you 10%, or 15%, or 12% of your salary out of the pool
of profits. And it always is 12% of your salary, no matter whether the company is terribly profitable, or
not so profitable.
Attendee: And does everybody get it?
TOM: Everyone in the company gets it, yes. All 900 people, once they have – well, but there’s a
wait – an IRS waiting period, I think that it’s up to a year. So in the second year you get this. And it’s put
into the profit sharing plan, which then compounds, tax free, until your retirement, or you leave, or
whatever.
JAY: One last question, and it’s an embellishment of this gentleman, but – in people who are
more result-critical, do you have supplemental programs for them too?
TOM: Yes, for the people who are more result critical, which is the word that’s being used, we
have other additional plans. There is the bonus plan, and the stock option plan, and promotions, and
raises.
JAY: Are those in lieu of, or in addition to, or…
TOM: In addition to the base salary. Oh also, Bob King came up with an idea. We had such a
wonderful, wonderful year this year within one of our subsidiaries, even more than the oldest subsidiary
itself – Phillips Publishing, Inc., subsidiary of Phillips Publishing, International – went over $100 million in
sales, highest profits ever. And so Bob had the idea which I approved and endorsed and participated –
we gave each of our employees in the Phillips Publishing, Inc. subsidiary five extra vacation days to be
taken whenever they wanted over the next 15 months – this summer all the way through ‘til the end of
next summer. Because they had been working so hard, they had produced. They had results. And
when we tied it to the fact that we had results, and therefore, we could afford to do that. So now, each
employee has extra vacation time, and that’s been very wonderfully received.
JAY: Great, OK
Steve Miller: Hi Tom, my name is Steve Miller. I own a small, growing advertising agency.
TOM: Oh great. I started my career in advertising agencies, as you may have heard yesterday.
Steve Miller: You said yesterday that you, once a year, for one month, completely rewrite your
business plan?
TOM: Yes.
Steve Miller: We were curious, at our table – how do you do that? What five major steps do you
take to sit down and do something of that size and undertaking?
TOM: Well it’s an annual business plan, and it’s a budgeting and business planning of every
product, from the bottom on up, and we just started the first year, saying, “OK, what did we do last
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year? What do we think we can do next year?” But we now – it’s a lot more sophisticated than that. I
don’t have the time now, to go through all the steps, but…
Steve Miller: But the answer is, Tom, you don’t do it. You don’t do it – your people do it.
TOM: Yes, that’s right, exactly. I don’t do it. All the individuals do. For instance, the individual
looks at his individual product, and say, the publisher, or the direct marketing manager, or the group
publisher will look at a group of products. It’d be like – if I may use an analogy in your case, you’re
looking and evaluating each of your client relationships every year. How much did they spend last year?
Are we going to get 15%, or 17.5% of this? What did the economy look like? What are their product
lines? What’s their competition? What’s their budget going to be, flowing to us? How can we get more
of their budget? How can we cut out the competition of other ad agencies, and get, you know, all of
their lines of products advertised, and what do we need to do in hiring key people to build this account –
the whole thing. The whole budget, but we don’t call it the budget, because it’s a business plan; it’s a
rethinking of the business. And then, you just do it, and if you’re living your business all of the time, this
is the time to sort of step back, and you get a little bit better perspective than the day-to-day. I mean, I
don’t know if that’s helpful enough, but there are a number of –
You can ask – anyone who asks, who wants to delve into our business planning at greater depth,
and I hate to do this to my colleagues, but they all know how the plan works. So any Phillips Publishing
employee should be able to help at this conference. They will give you a few more insights, but I really
can’t in this time frame. Don’t hesitate to question that.
Attendee: Greetings. I think that’s a great idea. My company this last year, I would describe as
sales being flat. They were up, however the profits were down. We don’t currently publish anything
like that, however, the grapevine went through the company, of course, and the information was readily
understood that the company wasn’t faring as well as it might have in years past.
So if I publish something like that the question is: In your experience, when you publish that, you
have something now that is very visual. That they can see that we’re either up or down on a monthly
basis, or an annual basis. That information can either be demotivating, or it can be stimulating. So tell
me how it’s been for you, and if it has been demotivating, how you’ve dealt with it.
TOM: Well we try, obviously, not to have it demotivating. Normally it is stimulating, but it’s
always one of these self-fulfilling phenomena. If you’ve got a team of winners, they don’t want to be
involved in something that is not winning. So if it’s a behavior problem, they are encouraged, with our
help, to change their behavior to have more impact on the marketplace. If it’s a marketplace problem,
then we look – do we want to be in this marketplace, where we’ve merged this into? If it is a product
problem, that puts a lot of heat on us to work with the editor, or writer, or whomever is helping us
create this product, to make it meet the needs of the marketplace. And then eventually what it does, is
after too many months or years of it being negative, if it isn’t losing money already –
I’ll put it this way: it helps you shoot the bad products, or kill the bad products. I’m not very
good at that, because I fall in love with my products. I confess. A weakness of mine. I told you not to
do it. It’s a deadly sin, which unfortunately, I do. I love these little products that are going to be the
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next multi-million dollar winner. It just is going to take too long, and too much money. So some of the
people who have better business training than I, and more discipline than I remind me that we should
be continuing forever, if something is a lost cause.
JAY: Good. Thank you.
Jeff Mavis: Hi Tom, I’m Jeff Mavis.
TOM: Hi Jeff.
Jeff Mavis: I’m a freight forwarder. As you know, probably most new businesses don’t make it.
And I was wondering if there was a milestone in your business where you came to the conclusion, “My
business is viable – it’s for real now.”
TOM: Well, I’ll put it this way. I never was worried about making it, because I wasn’t smart
enough to know that I couldn’t do what I did. I was fortunate enough not to go to business school or
have an MBA, because I would have spent my time on the wrong things, because they don’t teach, as
my son was saying, “entrepreneurial stuff”. They may teach accounting, and finance, and marketing,
and so forth, but it’s not, sort of the real world. But it’s a wonderful foundation, a great framework. But
then you have to go beyond that. So I probably would have been bogged down in the wrong stuff.
I guess it was a gradual thing. The way you end up having enough money in the bank every time
to meet payroll. You end up the first year with money in the bank, and we didn’t start with any money
in the bank. When you can attract and retain employees. When somebody says, “Hey, you’re quite an
entrepreneur yourself.” You get so close to your business you don’t know whether you’re successful or
not sometimes, until somebody else sort of validates what you’re – “Hey, you’re doing pretty well.”
“Oh, I am? Oh yeah, I guess we are.”
So it was no one point, that, you know, on April 12 of 1982 I said, “We’re a success.” And in fact,
one of the points – that you never can rest on your laurels. You’re never a permanent success. We’ve
been successful so far, and if you get overconfident, you get arrogant. If you become arrogant, you are
ready for a fall, and the marketplace is going to teach you a very expensive lesson.
JAY: Good, OK, next.
Jeff Brandt: Hi Tom. Jeff Brandt with Summit Limousine up in Detroit, MI.
TOM: You’re from Detroit?
Jeff Brandt: Detroit, mmm hmm.
JAY: What’s the business?
Jeff Brandt: Summit Limousine. You and I spoke – Jay and I spoke last September on the phone,
and some of you may have seen me in the November newsletter.
JAY: How are you doing?
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Jeff Brandt: Doing very well, thank you.
JAY: Did our conversation help?
Jeff Brandt: Yes, yes. One of the things that we did is, again, we’re in the limousine business, so
luxury and upscale is pretty much what we’re all about. One of the things that Jay and I discussed was
possibly cross-selling our clients. Case example, here – one of our clients had gone out and purchased,
after our conversation, Jay, a private jet. Long story short, I started cross-selling time on his jet to all the
other clients. Now I’m literally making money sitting at home watch – well, not watching TV, but…sitting
at home reading the massive bulk of my pre-attendance materials.
JAY: Is it working?
Jeff Brandt: Making money, sure. While these guys are flying my clients around town.
JAY: That’s great, that’s great. What’s your question?
Jeff Brandt: My question is specifically about newsletters. If I’ve learned anything here, and
from Jay’s newsletters, that is – and from talking to all of you, I think we’re all convinced that our core
service is nice, but I’ve got a real big feeling that there’s a lot better ways to make money, based on my
core service. And Tom, my question specifically is about newsletters. Let me give you an example.
Right now in Detroit, the Detroit Metropolitan Airport, which my company visits on a daily basis,
dozens of times, is undergoing a massive, $1.6 million expansion. I have spotted a need not only to my
clients, but to everybody who travels in and out of that airport in the Detroit area: To put together a
newsletter which is really designed to have me go and do all the legwork, gather all the information as
to what’s going on at the airport; which parking lots are going to be open, closed; what the rates are;
when this part of the airport is closing; when the new terminal’s going to be underway, and whatnot. So
I’m going to be the man who’s doing all the legwork, and I’m going to put that in the newsletter. My
very strong feeling is that for myself, and for perhaps everybody in this room, to put it in Jay’s terms,
this newsletter for me is a very strong pillar to my parthenon.
Am I on target there, A; and B, if I am, do you have some tips for what produces a productive
newsletter?
TOM: Wow, this is a whole course, but let me give you several principles…
Jeff Brandt: I’ve got the time.
JAY: That’s gracious of you!
TOM: Number one: There are three types of newsletters: subscription-driven newsletters,
which all of you subscribe to, such as Jay’s, which a publisher creates, solicits subscriptions, gets them in,
and fulfills a product. It’s a one-on-one relationship between the subscriber and the editor or publisher,
or whatever.
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Secondly, there are free newsletters that, you know, your church passes out, the PTA passes out
– all those things. Entirely different category. Charitable things, free internal PR newsletters for
companies…we even have a newsletter ourselves within our company. That’s a second category.
And then a third, our contract newsletters. I would suggest that your area – it might be neat for
you to try to do a contract newsletter, where you would do all of this work and then you would have a
contract with the Detroit Metropolitan Airport Authority, or whatever it is…to produce this on a monthly
basis, or whatever, and distribute it to all of their constituencies that need to know what’s going on.
And that could probably be funded through the PR budget of the Airport Authority, or the advertising
budget, or the chairman’s slush fund, or whatever. Because you’d be providing a service to their
customer, and most organizations like that aren’t good at gathering information, reporting, and taking it
to the printer.
You don’t want to fall into the trap of being just a printer.
JAY: Last question.
Ted Pulitz: Hi, Ted Pulitz from Toronto. My company is Ingenious Growth Strategies, and I’ve
been positively taken by your talk, because I recognize the essence in you, in business, which is an
enthusiasm to enjoy what you do. I would attribute that to probably your success.
I’d like to know what you do on a daily basis to – what you feel, on a daily basis.
TOM: What do I what on a daily basis?
JAY: He’s trying to run a model of your mindset, other than what you’ve said. He’s saying on a
daily basis, how do you think, other than what you’ve said. He’s trying to think – he’d like to mirror
you…he’d like to grasp…
Ted Pulitz: Yeah, I’m intrigued as to, what is it that you derive on a daily basis that you come
away with, that’s positive to you? That continues to go on, that continues you to grow the company?
TOM: Well, the very people that I spend my day with. I love the people I work with. I mean, it’s
exhilarating to interact with them. I want more time with each of them. I just run out of time to be with
people, and exchange ideas, and I like to walk around the office. I enjoy the recognition day. I like to
meet all new employees. We now have a Monday morning training and orientation session, and I’m
disappointed when I’m away from the office, because I can’t meet the new employees and welcome
them.
Now also, what I am doing during my whole life, and what is going on in my mind, is I am
dreaming. I’m dreaming what we can become, because this is all just starting.
Ted Pulitz: Are you living your dream?
TOM: I’m living – sure, I dream my dream, and then I make my dream come true.
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Ted Pulitz: Can I make one mention, Jay, if you wouldn’t mind? I’ll just take a second. I found
your talk very interesting, and I think the business about going the extra mile and really enjoying what
you do, and so I’d like to act as a mild catalyst to your $5 million endeavor. And I would imagine there’s
quite a few people in this room that could assist you in reducing that $5 million expense this year, in ’96,
to perhaps 2 or 3. So therefore, I’m just acting as a catalyst, and if you could put your business card
perhaps up on the stage, and offer your product or service at no cost - or for no profit - to Tom, in
helping him grow his company, because he’s trying to help us grow ours, and there’s a substantial
savings.
JAY: And then, you know, if enough people do it, you can bid on how much you will pay him to
take your product.
TOM: Well, let me thank you for your thoughts, and your goodwill, but I will say this. I would
love to work with a lot of the people in this room when we have products and services that we can
exchange. We have exchanged products and services for this conference, because we helped Jay
organize it. But they’ll be products and services you have that we can profit from. But I want you to
make a profit on our relationship.
JAY: He has to. And tell him why.
TOM: Exactly. You have to, not only to survive, but I want you to do more business with us. I
want you and your team to think of us as the most important client; the most profitable client; the first
client you call. And so, if it happens to be by reducing our cost, that’s great, but I don’t want it to come
out of your hide. I want it to be a win-win.
JAY: Thank you very much.
Ted Pullets: Thank you.
TOM: And thank you, very much. And if I may say, I want it to be a win-win for all of you.
3B END
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Stephen M. R. Covey Teleconference

Leading At The Speed Of Trust
Featuring Jay Abraham
September 29, 2005
OPERATOR: Welcome to today’s teleconference interview between Jay

Abraham and Stephen M.R. Covey on “Leading at the Speed of Trust.” It’s my pleasure
now to introduce your host, Mr. Jay Abraham.
JAY ABRAHAM: Hi everybody. This is probably one of the biggest treats that
I’ve had probably in the last two or three years. It’s a great, great honor and great
pleasure for you, and for myself. I’m going to be interviewing Stephen M. R. Covey, son
of Stephen R. Covey.
Stephen M. R. is a former CEO of Franklin Covey. He orchestrated a lot of their

growth, a lot of their combined leadership in the field of training, and time management,
and corporate achievement. And then he and another colleague of mine, Greg Link,
started their own enterprise to take some of the technology and the methodology of rapid
growth and rapid advantage for corporations, and have built a really dynamic corporation
of their own.
And in the process of their body of breakthrough, landmark work, they’ve come
up with something that I personally think is so relevant, so profound, and so dramatically
overlooked by almost every entrepreneur, small business owner, professional and startup
out there that I prevailed very, very heavily on my relationship with both of them and the
friendship I had with their father to ask Stephen M. R. if he would allow me to probingly,
penetratingly “grill and drill” him with loving regard for about an hour and a half today
on the key elements of their breakthrough, I guess, technology.
Because they have, I think, identified, understood, and developed a keen

awareness of what I will call the “last remaining bastion” of exceeding upside
performance, profit, and competitive advantage that remains available for the business
owner, for the entrepreneur, for the enterprise, without spending money. It’s spending
something far more precious -- the ability to understand and connect.
And the subject that they have focused on is “Leading At The Speed Of Trust.”
© 2006 All Rights Reserved 1 www.abraham.com
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I’m going to do a disservice to them, but I’m going to set the stage. I’m going to
introduce Stephen, and then we’re going to begin a very fast-paced and a very spirited
discussion, debate and interview that hopefully will take you, the listener, to a whole
realm of reality, awareness, and connectivity that you have never thought about before.
And we’ll open the spigots and the floodgates of opportunities, possibilities and
potentials that you’ve never seen were within your grasp.
But the key, in my mind -- and it’s a disservice, but Stephen, before I even
introduce you, I’m forewarning you. You have my respectful charge to correct,
embellish, expand and improve upon any mis-explanation I make.
I think the key to what we’re going to be talking about today is that trust is the
key accelerator, the key bonder, the key extender, the key motivator, the key facilitator of
all that is accomplished of any good in the world today.
Lack of trust is the key deterrent. Lack of trust is the key frustrator. Lack of trust
is the key compromiser.
Trust is of many different natures, and we’re going to get into as many as I can,
and some really intriguing facets. But the faster you gain the trust of a prospect -- the
quicker the sales cycle is closed… the faster the purchase is made… the more the size of
the purchase… the more items are purchased… the more frequency of purchase… the
more people they’ll refer to you.
The faster that the vendor understands and trusts you -- the more collaboration…
the more creation… the more development… the more support… the more financing.
The faster the team “gets” you, trusts you, believes in you, understands you -- the
faster the clearer, the more complete they execute… the more they accomplish… the
more they extend the objective.
The faster the stakeholders “get” you, and you they, the more collaborative… the
bigger the organization grows… the greater the legacy.
That’s not a full service, but I’m going to start with that and welcome you,
Stephen.
STEPHEN M. R. COVEY: Thank you, Jay. I’m delighted to be here, and I’m
looking forward to the “grilling and drilling,” because I want to have a very dynamic
discussion.
JAY: Well, so everybody is clear on the background of this, Stephen and Greg
are good friends of mine. His father is a friend of mine.
When I learned about their powerful body of work, I insinuated myself and said,
“I demand the opportunity to at least take what you have discovered and translate it for
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you and for my entrepreneurial audience to them… give them an extraordinary 70- or 80-
minute education.
Our goal for the next 80 minutes is to take what you have taken to a very
heightened level of understanding, and to torque it down to such relevant, day-to-day
implications that any entrepreneur, any business owner, startup, professional, or
somebody who runs a P&L-based division for a bigger corporation gets it instantly.
So what I’m going to do -- and you’ve given me permission -- I’m going to power
through a lot of the elements in your curriculum. I’m going to draw out a buzzword, a
question, hopefully in the right order. Everyone listening, Stephen and I have an
understanding. Because he’s been living with this, and he and Greg, his partner,
discovered it, refined it, developed it, perfected it, have trial-ballooned it, have innovated
it… I would do a disservice thinking I even became close to comprehending anywhere
close to the fullness of it.
So I’m going to take them on a path. Their job is to correct me if I’m wrong or
restate it. And so, with that stated, are you ready to go?
STEPHEN: I’m ready.
JAY: OK. What I’d like, if you don’t mind… And again, your operative word is
translate everything you talked about from general “corporate-ese” to specific, hard and
graspable entrepreneurial clarity.
The first thing I’d like you to do is just give us about a five-minute overview on
the big picture of why trust -- a lack or an abundance of it -- is in fact the last remaining
area of leverage any enterprise has in a little bit more context than I probably did it
justice, OK?
STEPHEN: That sounds great, Jay, thank you. Here’s how I’d like to begin:
This whole idea of trust is probably the most underestimated, misunderstood,

neglected, even ignored factor in business, in our careers, in our relationships, and also in
life. And as Jay is saying, it’s something that becomes an intangible opportunity for us to
run with, because we’ve neglected this. We’ve misunderstood it. And I maintain you
can make this tangible. Here’s the basic idea:
Trust always affects two outcomes in business, in relationships, and in life. Two
outcomes are always affected by trust. They are speed and cost. When trust is low,
you’re going to see speed go down, and costs will go up. I call this a “tax”. There’s low
trust -- you’re paying a tax. You’re in a relationship… it could be with a customer, it
could be with someone you’re working with, it could be with a friend. If trust is low,
guess what? You’re paying a tax, and a manifestation of that tax will be this: -- the way
you can get things done, the pace at which you can get things done. That’s going to go
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way down. It’s going to take you a lot longer to do anything, and it’s going to cost you a
lot more.
JAY: Stephen? Now, I’m going to with respect ask permission to occasionally
interrupt.
STEPHEN: Please do.
JAY: OK. So my interpretation -- for all of you -- is that trust is of many

natures. It can be the intent. It can be the competence. It can be the clarity. It can be a
lot of different factors. So you have to be able to have some nuances as Stephen is
explaining to understand all the implications here. OK?
STEPHEN: There’s no question. See, when we talk about trust here, we’re
really talking about confidence. And the opposite of that is suspicion. So you don’t trust
someone when you’re suspicious about them, about their competence, for instance. You
don’t have confidence in them if they don’t have the right capabilities or skill sets, they
don’t have the right track record. You don’t have confidence in people or trust in them if
they’re not honest, or if their motive or agenda is hidden, and you’re starting to wonder
about it and question. That makes you suspicious, and that’s the opposite of what we’re
talking about.
We’re talking about confidence, about assured reliance, about moving forward
with trust. And so there are many, many different elements of it, and the big idea, really,
is this: That when the trust is low, the tax is high.
But the opposite is true: When you as an entrepreneur and an influencer, when
you build trust in your relationships, when you establish it -- suddenly you’re able to
move with incredible speed. I like to say that there’s nothing as fast as the speed of trust
-- for that matter, or as profitable.
JAY: Now, Stephen, a couple of points -- and again, I’m doing nuances, and they
may be too micro-relevant for everybody, and I may be just too hip for myself. You’ve
got to be able to discriminate, because you’ve got to be able to see that even the person
trying to compel you may not even realize that he or she doesn’t have your trust. You’ve
got to realize that you may not really be totally clear on why you are recoiling or
rejecting.
And then, more importantly, Stephen, you’ve actually done some -- because
you’ve turned soft abstractia into some pretty hard, relevant, measurable metric-based
data that blows the mind. And I would like to invite you as you’re sharing this to please
share all comparable data that you’ve been able with Greg to document that will blow
people’s minds to show what the acceleration, or the multiplication, or the increasing
factors are when you get these trust elements in control.
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STEPHEN: Absolutely. The data is overwhelming. There was a recent study

done of over 12,000 managers, where they contrasted high-trust organizations versus
low-trust organizations, and the core finding was this: The high trust organizations out-
performed the low-trust organizations by 286% -- that’s nearly three times higher -- in
total return to shareholders. That was in shareholder value, the thing that you’re driving
for.
It demonstrates a three times multiplier. I’m calling that the trust dividend, the
high-trust dividend, instead of the low-trust tax.
JAY: And Stephen, I would say that -- and I have such a heart-felt empathy for
the entrepreneur. But most entrepreneurs -- God bless every one of you on this call, but
you’re not masterful at managing, maximizing, motivating, inspiring people. The big,
not problem, but the big lament is that between fulfillment, frustration, dissipation…
probably 80% of their time is not even being maximized. And you probably have a
greater piece of the accelerating puzzle there than you even realize for an entrepreneur,
don’t you think?
STEPHEN: I think entrepreneurs probably more than anybody can leverage trust
-- better and faster than anyone, and I’ll tell you why. As an entrepreneur, you’re dealing
with all your stakeholders. You’re dealing directly with customers. You’re dealing with
suppliers, with distributors. You’ve got investors you’re dealing with. You’ve got your
coworkers, who you’ve brought on to help you accomplish your objectives. You’re
working with them.
So you’re working with everybody. And if you have an ability to establish trust
fast with all these different groups of people you’re working with -- your customers,
distributors, etc., etc., investors… -- having that ability to establish it fast, to grow it, and
then to leverage it…
If it’s the opposite -- in other words, if you’re not good at building trust, and
people are questioning or wondering… your customers are wondering what your motive
is, or your agenda, or if you’re capable… or your investors are wondering about you and
you don’t have that ability -- then you’re constantly backfilling, and slowing things
down, and taking a lot of time.
So I think that leverage factor for an entrepreneur is never higher than any other
profession, really, because you’re dealing with all stakeholders, all the time, and the need
for speed in these relationships is vital. And it’s not just the speed of trying to quickly
get things done. It’s also receiving this dividend, this multiplier -- having everything
become better because of the fact that you’ve established trust in your relationships, and
now people see you differently, and interpret you differently because they trust you.
JAY: That’s a great point. One more which I think as an entrepreneur -- when I
teach my methods to people they love it, but they go back and they say, “Well, how do
I…” And they don’t verbalize it like this, but if they really would, they’d say, “Well,
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how do I thrust this down the throats of my people who haven’t been exposed to it?”
And my answer is always, “The only way you can is to demonstrate it. Not tell it, but
you’ve got to show it.”
And what you’re saying, as an entrepreneur you’re out there in front of

everybody. It’s an incredible opportunity to demonstrate it in motion, 24/7. And you’ve
got incredible leverage, because as it’s being done, through osmosis it’s being absorbed.
It’s really sort of a cool concept.
STEPHEN: It is. I’m going to illustrate this, Jay.
JAY: OK.
STEPHEN: Here’s what I mean by “the speed of trust.” I’m going to describe a
deal that took place. And as entrepreneurs, we’re always involved with making deals of
some sort, with investors, customers… That’s part of our modus operandi. Well, here’s a
big deal of two large public companies, but it’s really all about making a deal.
Warren Buffett is the CEO of Berkshire Hathaway, one of the most respected
leaders in the world - Warren Buffet is. And his company wants to acquire another
company from Wal-Mart. The company that they’re buying is called McLean
Distribution. They’re a $23 billion enterprise, so this is a big deal -- a $23 billion
acquisition by two large companies.
Now, Warren Buffett, he is the CEO. He’s very trusted, and he’s very credible.
And he has trust and confidence in his counterparts that he’s dealing with at Wal-Mart.
And here’s how Buffett described how he was able to do this deal, this $23 billion
acquisition.
He wrote the following in his annual report: “To make the McLean deal, we had
a single meeting of about two hours. We then shook hands. Twenty-nine days later,
Wal-Mart had their money. We did no due diligence. We knew everything would be
exactly the way Wal-Mart said it would be, and it was.”
So here’s a big, $23 billion merger done in 29 days with no due diligence. I used
to work on Wall Street as an investment banker for a short period. I was involved with
big deals. Deals of this size would normally take a year to close, because you’ve got to
go through so many hoops and hurdles to jump over. And also, you would spend tens of
millions of dollars doing due diligence with accountants, attorneys, auditors, verifying,
validating that everything’s right.
But because they had trust in this relationship, they were able to move with
incredible speed -- 29 days instead of a year -- and with low cost… no due diligence
versus tens of millions of dollars. And that’s what I mean by “operating at the speed of
trust.”
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JAY: So let’s -- because my job, again, I’m the “Advocate General” translator in
charge of the entrepreneurial, not limited thinking, but more day-to-day thinking, because
an entrepreneur unfortunately (and you might get into this) tends to be a more tactically-
minded person, unfortunately. And you need to kick them up into the rarified world of
strategic thinking, which is where I think you’re methodology is going to play biggest.
But what is the implication to every entrepreneur, every professional, every

startup, every P&L-based manager who’s listening right now to what you just said?
What do they get from this little story?
STEPHEN: Here’s the implication: In the same way Buffett can do this, you
can do it as an entrepreneur as well in your relationships with your customers, with your
investors. By establishing trust, by getting good at this… Getting good at building trust
and establishing it with everybody you’re working with -- that will enable you to move
with incredible speed and low cost.
In fact, I’ll give you an entrepreneur example, Jay.
JAY: Please.
STEPHEN: Here’s a donut and coffee vendor in New York City. This is a one-
person shop. He has a cart on wheels, and he carts his little stand on wheels. He sets up
shop right outside of an office building in Manhattan, New York City’s Manhattan. And
people come by to go into work, and they buy a donut and coffee from him. And he
noticed that there were these long lines forming, and then some people would get out of
line because it was too long. And he realized that what was taking him so much time was
making change for his customers.
So he just decided, “I’m just going to put a little basket on top of my cart here
with dollar bills, nickels, dimes and quarters, and I’m going to just serve the customers
donuts and coffee, and they’re going to make their own change.”
JAY: So you put the onus on them.
STEPHEN: Yup. He put the onus on them. “Make your own change. I can
serve you the donuts and coffee. I can move faster.” And what happened was he went
through customers twice as fast. He doubled his customers. He was able to process all
these people. He added no new cost, twice the speed, twice the customers, and guess
what? They were honest with him. They didn’t rip him off. I mean, he had some risk in
this, of course. Maybe someone takes some extra nickels or quarters.
JAY: That’s a great example! That’s a great one. Now, let me ask you this: Is it
appropriate… And again, I’m asking permission because I’ve been blown away for a
month and a half by your work, but you’ve been dedicated with Greg doing it for years.
So you understand it at a much more seminal level. Is it worth talking about the “Seven
Low-Trust Sinkholes” right now, or is that inappropriate?
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STEPHEN: Well, I’ll just give you an overall idea of it.
JAY: So give a little of the reference of what it is, and the cost, and how it can be
either mitigated, eliminated, or at least recognized.
STEPHEN: Yeah. Here’s the idea: It’s simply that, again, trust is always
affecting speed and cost. Now, it doesn’t always show up as a low-trust cost. It shows
up in other ways. It gets hidden. See, this is like a hidden variable that’s affecting
everything else.
Trust is the one thing that affects everything in a company. But we often don’t
recognize it because it gets manifested in other ways. But when you have low trust
you’re going to see all kinds of bureaucracy creep in, and different types of cost creep in
that are all part of compensating for a lack of trust elsewhere.
And the idea of the Seven Low-Trust Sinkholes is simply this: That things show
up, and you wouldn’t recognize it as a cost of low trust until you realize because the trust
is low, we’re having to do these things to compensate.
Let me give you an example. Take in the United States here, after the 9/11
terrorist attacks. Our trust or confidence in flying in this country went down quite a bit,
especially initially, right after these attacks. These were brutal. Well, we had to restore
that trust or confidence in flying. So we put in place some procedures, more robust
security procedures to give more confidence to fly. And yes, it did help. But there was a
price. Things took a lot longer, and they cost more. We had to put in place more robust
security, and it took longer, and there was a cost and a tax that we were paying with every
single ticket we bought in this country.
Well, I recently flew into and out of Tel Aviv, Israel. Now, the trust in Israel is
quite low for obvious reasons, for critical reasons. When I flew in and out of Tel Aviv, I
had to arrive at my airport four hours before my flight, because it took that long to put me
through the process. My bag was unpacked and repacked three different times, and I was
interrogated several times. And I was treated like any other passenger. But they had to
put in place all those procedures to help restore trust or confidence in flying there because
the trust was so low all around them. That was good and useful because it did help
confidence, but at what price, Jay? It was at a huge price. A lot of time and money was
spent to administer this.
And those are what I call the “Sinkholes” of extra props and layers of policies,
procedures, processes that are expensive and costly and time-consuming, that are put in
place as a proxy for a lack of trust.
JAY: And I like that. Now let’s -- because I want to take you on a broad
spectrum, and this is basically my attempt to do a tour de force overview
summary/introductory primer on something that I know that in an environment of two
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comprehensive, eight-hour, integrated, exercise-based, specifically, individually

focused… People take their own situation and they delve into it, and they analyze it, and
they identify it…
And it’s a disservice, but I want to get into some fun things. Can we talk a little
bit about the two dimensions of trust - character and confidence, and have you explain a
little bit about that? And then maybe demonstrate what the implications might mean,
again, to the entrepreneur or to the small/medium business owner or professional?
STEPHEN: Absolutely.
JAY: Go ahead.
STEPHEN: Think about it, Jay. Just think about the people that you trust. You
entrepreneurs, think about the people that you trust. And you’ll find basically that there’s
always two dimensions as to why you trust someone.
One is that they have character. That’s who they really are. The other is that they
have competence and ability to do things, make things happen. And you really trust
people that have both character and competence. Both are vital. If they have only one
and not the other, then we’ll tend not to trust them.
And as an entrepreneur you’re constantly dealing with people, and you want to
work with people that you can count on, and rely on, and trust. And that is a reflection of
both, do they have character? And do they have competence? If they have both, you can
trust them. If they don’t -- if they’re lacking any one of those, then you won’t.
Now, I’ll give a personal example which illustrates the importance of this. My
wife recently had to have some medical surgery. Now, my wife trusts me, and I trust her.
She cares for me. I care for her. But Jay, when it came time to do the surgery, guess
what? She didn’t ask me to do it!
JAY: OK!
STEPHEN: And why didn’t she ask me to perform the surgery? Because I’m
not competent to do so. I’m not a doctor. And so her trust in me didn’t extend to
performing that task because I didn’t have the competence.
That sounds obvious, but it’s really how trust is formed. It’s a combination, the
overlapping, of character and competence to perform the task. When you have both of
those dimensions, you’re now in a position to build trust. So it not only applies to the
people that you look at trusting, but put the question to yourself. Do people trust you?
As an entrepreneur, do people trust you? Do you give them reasons so they can trust
you?
And they’ll look to your character. They’ll also look to your competence.
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On the character side, they’ll look to see, are you honest, and do you care about
them? Do you want them to win? Do you want mutual benefit?
And on the competence side, they’ll look to, what are your capabilities? What are
your skills? Do you have the right skills to get things done? That inspires confidence.
And they’ll also look to your track record. What have you done? When have you made
this happen? What’s your track record like?
When you have high marks in all of those areas -- of integrity and intent, and your
capabilities and your track records, your results -- then that inspires trust and confidence.
And suddenly you can start moving faster with people. They’ll trust you. You’ll trust
them. You can move at incredible speed, like the Warren Buffett story, or the donut and
coffee vendor in Manhattan.
JAY: But now, I’m going to interrupt you. And I think the real, not the nuance,
but the real critical factor of distinction here is a dual factor. One is the ability to take a
deep breath and recognize and perceive it, and then recognize how it has to be either
manifested or personified. Because I don’t believe we realize that at every moment in
time, everybody is being judged on a multiplicity of facets, instantaneously and almost
subconsciously by everybody. They’re being judged on words, on conduct, on history,
on congruency, on body language…
This concept of ethos, which I think is one of the most overlooked and
monumentally important factors to an entrepreneur, is a constantly reflected upon,
instantaneously accessed element in the eyes of buyers, prospects, people that have had
historic experiences with competitive types, or alternative providers. And I think you’ve
got to be able to not get daunted, but to be above it all and have enough strategic
understanding to recognize that these are real, recurring, continuous, constant factors of
either opportunity or danger that exist continuously with whatever you want to call it -- a
business relationship, or a personal relationship… Don’t you, Stephen?
STEPHEN: Jay, absolutely. You’re right on. And this ethos you’re talking
about -- really, what people are saying, Jay, is, “Can I trust this person? Do I trust this
person? Do I have a reason to trust them? Are they credible with me?”
See, “ethos” is from the Greek philosophy, and it means credibility.
JAY: Yup. But I don’t think a lot of entrepreneurs really get it. I mean, we --
and your dad and I have had a lot of discussions about my belief -- that I believe that your
role is to serve as the most trusted lifetime advisor for somebody. And in that role,
you’ve got to do -- it’s almost like the Hippocratic Oath. You do value, but you do no
harm. You can’t sell them too little. You can’t sell them less. You’ve got to educate
them. You’ve got to tell them what’s in their best interest. You’ve got to do that which
is right.
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But I think a lot of people are so struggling in entrepreneurialism just to make a

living that they don’t allow the full force of the power of something as profound, and yet
as seemingly intangible as this to take hold. And I’m going to challenge you to do
everything you can for about a five-minute stream of consciousness to make the
intangible of this real tangible to them. Can you do that?
STEPHEN: All right. I’ll do it, Jay.
All of us are entrepreneurs at one level or another. We’re always trying to sell
our ideas, grow our business, grow revenue, win customers… We’re always working
with people and through people. We’ve got to make things happen. Well, starting, like
you say, Jay, it begins with each of us personally. It’s an inside out process, always.
Building trust likewise is an inside out process. If you want to have this
incredible speed that happens when the trust is there, then you need to recognize, “How
do I do this for myself? Where does it start?”
It always starts with yourself. So even before you say, “How do I build trust with
other people?” you first say, “How do I do this with myself? How do I build self trust?
How do I build this individual credibility that will then become the foundation for
building extraordinary trust with other people?” And then, with that trust in place, I’ll be
able to move at this incredible speed, low cost, and get more and more things done. So
it’s very much an inside out process.
Now, when it starts with yourself -- self trust -- here’s the idea: It’s all about what
you just described, Jay. It’s all about credibility. Are you credible?
“Credible” comes from the Latin term “credire” which means “to believe.” So
it’s really a question of “Are you believable?” If you are believable, because people
recognize your character and your competence, then they’ll trust you. With that trust in
place you can truly be the trusted advisor that’s able to work with customers, work with
investors, work with all the different folks that you’re dealing with, and they’ll believe
who you are, what you’re trying to accomplish. You’ll move with incredible speed
because of it. So it always starts with yourself. And the key principle there is individual
credibility.
Now, I’ve already mentioned the four core areas that you build that credibility.
The first is your integrity, the foundation of who you really are. And that’s like the root
system of a tree. It’s mostly below the surface, but it gets manifested when the storm
comes, because the tree holds if the root structure’s strong enough, because the integrity’s
there. When it is, it’s a foundation now for the credibility in your relationship and the
trust that you’re able to establish to move with incredible speed.
You then say the second core of this credibility is your intent, which is referring
to your agenda, your motive. Are you seeking mutual benefit? Do you want your
prospect to win? Do they know that you want them to win? Do they feel it? Because
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you know what? If you’re trying to sell something to somebody and they just think
you’re trying to make a sale, they don’t think you really want them to win or care about
them. But you’re trying to make the sale. They won’t trust you. You won’t be credible
in their eyes.
But with that credibility that comes from your seeking mutual benefit -- their win
as well as your own -- they now have a basis on which to trust you.
You then move into the third core of credibility, which is your capability, your
skills, your talents. You have the right skills to accomplish the task you’re trying to
accomplish with the people you’re working with, with your customers. If you do, then
they’ll have trust and confidence in that. If you don’t, they won’t, and you won’t be able
to make the deal, or to get the customer because they don’t believe you can deliver on it.
And then finally, the fourth core of this individual credibility is your results. This
is your track record that I mentioned earlier. You have a track record of results, where
you get things done, and make things happen. When you do, that makes you credible
with people, and they’ll tend to trust you. If you don’t, then you don’t have that same
credibility and they’ll withhold the trust. And so you’ve got to establish some credibility
through your track record, through your results.
When you put all four of these pieces together -- integrity, intent, capabilities, and
results -- you now have the foundation of absolute individual credibility, and you can
establish it with everybody.
JAY: Now, I’m going to take my liberty and insinuate my bad self a minute,
because I had three thoughts that I want to share.
The first one is an interesting one. I spoke to a very prominent MBA

entrepreneurial school about three weeks ago, and I polarized. Half the people got my
soft and intangible, and they got into it, and half of them summarily rejected it and
thought it was hokey.
What you’re talking about is something that I believe. You talked about the root
system, or the underpinning of a tree. I don’t think people realize the compound…
Because I deal in compound exponential geometric growth. This is where you’re really
creating this quantum type growth capability, not just in economic terms… not just in
commercial terms -- but in probably the most enriching of all, which is fulfillment,
satisfaction and achievemental terms. But it requires you to do some very deep,
reflective soul searching and develop the capacity, Stephen, I think, to translate very
abstract intangible into tangible and measurable factors, and have the ability to have an
out-of-body experience and recognize what it looks like from the outside experiencing it.
That’s the first thing.
Second is, I really want to make this point. What you are teaching is if you’ll take
the time now to re-engineer… It’s like when I was teaching people how to make
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irresistible offers 20 years ago. And I said, “Do you know why I’m teaching you to do
this? Because the vast majority of you make resistible offers.” And I’d go through all
the spikes and the deterrents. And then I taught them how to take risk out of it. Then I’d
talk to them about accelerating or reducing the hurdle rate. Then I talked to them about
best practices. And I had to slow them down, because everybody wanted to move
forward.
The last thing I want to say -- and you’re welcome to say “ditto,” or say “I don’t
agree,” or say “There’s a great idea you just gave me, and I’d like to expand upon it,” or
none of the above, Stephen. But one of the most important elements that have come out
of my body of work, and it grabbed me by the throat, and I’ve got to say it -- is that when
I’m teaching people say, “Well, what should I say or do?” They’re looking for a
manipulative, technical way to execute on something that is totally not technical. And I
always say, “It has nothing to do with what you say. It has to do with how much value
you’re trying to contribute, and how pure the intent of that is.” Because the purer the
intent, and the clearer the understanding, the more fluid, natural and continuous the flow
will be. And that’s my belief. You may disagree, though.
STEPHEN: Well, I agree with that, Jay, but that is the foundation. I would just
argue that there’s a second half too. And I think you would too. So here’s what I’m
saying:
You start there. That is integrity and intent. If you don’t have integrity and intent
-- and by “intent,” I mean again, your agenda, your motive of trying to help other people
win. Without that, it doesn’t matter how smart you are, and how articulate you are, and
the like. You won’t sustain a long-term relationship of trust. It will break down. You
have to have that as a starting place.
But then I also add this, and this is what gives trust a harder edge. Because for so
many people, trust just means “Be nice. Be good to everyone, and like people, and be a
nice guy.” That’s not the kind of trust I’m talking about.
JAY: What’s it mean to you?
STEPHEN: It means this: It means get results, but get results in a way that
builds the relationship. Make things happen. Make the right things happen, but do it in a
way that builds a culture of trust so that you can do it again, and again, and again. In
other words, you start with this foundation of integrity and intent, but then you add to it
the other cores of credibility -- capabilities and results -- so that you are all about making
things happen, getting stuff done. Those are the people you trust, that also are honest
people, and that have the right agenda or motive. They’re not trying to just look out for
themselves. They’re always trying to create value, like you’re saying, and serve other
people.
They also have the tools with which to get it done. You need both. And by
taking the “both” approach -- the “and” approach, as opposed to the “either-or”, I believe
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you embrace what you’re describing, Jay, which is the absolute foundation of the
character, integrity and intent. But then you also empower it with the strength of
capabilities and of results, of the competence dimension.
It’s the combination of the two that makes you a trusted leader that can get results
and make things happen, but does it all in a way that builds the trust with people so they
can make it happen again, and again, and again.
JAY: You’ve just taken me to a heightened level, and I’m going to respond with
another challenge, if I may.
STEPHEN: Please.
JAY: And this is actually and probably more -- I get very excited talking to
stimulating thinkers who have taken a very powerful, but a disarmingly abstract concept
to tangibility, and you’re delighting me with this.
A couple of people that I’ve spoken with on a couple of related issues over the
years -- one of them had a very interesting belief. He said that every time two people
come together to transact any kind of an activity -- business, fraternity, relationship --
your job should be to make their life better off because you were in it.
Another company, totally different, but parallel universe that grew from almost
nothing to a half billion dollars a year in about five years mirroring an ideological plane
that was very similar, but not as refined as yours, believed that every time we’re
communicating with them -- whether it’s delivering, whether it’s sending them
something… we need to add value. We need to make them improve and grow.
And I think that there is an element on that that’s an offshoot of this. And I don’t
have it refined, but I’d like to throw to you the gauntlet to play back to me what I’m
trying to say in a more cohesive manner that is relevant to your message.
STEPHEN: I think it’s this, Jay: That, what creates this suspicion and this
distrust and cynicism in society? Because there’s a lot of low trust everywhere around
us, and cynicism and suspicion. And it’s because too many people aren’t creating value.
They’re in it for themselves. They’re not contributing. Rather, they’re almost like
parasites.
JAY: Will you give me four examples, just so that we can make it crystal clear,
demonstrably, so people can see what we’re saying is the antithesis of what we’re trying
to teach?
STEPHEN: Sure. The antithesis of this is the person that is what I would call a
low-trust leader. He’s in a position of leadership, but people don’t trust him (or her).
And they use their position power in whatever role that is to try to get things done by
edict, but not through who they truly are. They’re just in their position. And people
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don’t trust them. They don’t respect them. They’re worried behind their back that the
person will turn on them. And they’re worried with every move that they make that
there’s not criteria or principles built into the way the person operates.
And so, by contrast, a leader that builds trust is one that’s most applying and
improving everything around them. They’re like Magic Johnson on the basketball court
that makes everybody better around them. And the high-trust leader is able to do just
that.
I’ll give you an illustration just straight up. Take communication, Jay. Take
communication, and imagine a relationship with someone with whom you have high
trust, and imagine a relationship with someone with whom there’s low trust.
JAY: OK.
STEPHEN: When you communicate with someone with high trust, you can
almost say the wrong things and they’ll still understand you.
JAY: You’re exactly right, because they know that the intent -- they’re hearing
the intent.
STEPHEN: They’re hearing the intent. It fills in the gaps. They know your
heart, your motive, your agenda. They trust you. It fills it in.
Take someone with whom there’s low trust, very low trust, and now you’re
communicating with that person. In those cases, you can be very measured, even precise
in your communication, and they’ll still misinterpret you. They’ll still read things into it.
They’ll still add things into it, because they don’t trust you, and you don’t trust them.
And it deteriorates.
In fact, that’s how we end up in all this litigation in legal circles with legal
communication. If you think about it, legal communication is the lowest form of
communication because it’s based on no trust -- or at best, low trust.
JAY: Great point.
STEPHEN: And look how expensive it is, and look how much time it takes.
That’s what I mean by speed and cost. If you get involved in lawsuits, you get involved
with legal channels, and the communication is based on low trust or no trust, and it’s very
expensive, and takes a lot of time.
Now, compare that to where you’ve got great relationships, and you’re able to
make deals on a handshake, because the trust is there, the belief, the confidence… That’s
speed and low cost.
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JAY: That’s great. Now, I’m going switch the game we’re playing. I have two
categories I’d like to titillate over your head and let you pick either/or, or a combination
of both, and tell me which is the most relevant to talk about now, OK?
STEPHEN: OK.
JAY: One is going to be the Five Different Levels Or Waves Of Trust, and the
other are the 13 Behaviors Of A High-Trust Leader. You tell me which or what
combination, or if there’s something better that we should be adding at this point as we
progress them on the pathway to a more enlightened awareness of the opportunity that
awaits them.
STEPHEN: I think the 13 Behaviors Of A High-Trust Leader is the best path.
JAY: Would you then, would you take us on that?
JAY: OK.
STEPHEN: This is extremely actionable. These behaviors, we’ve studied

leaders and influencers around the world, and in organizations, entrepreneurs, in schools,
in government… So this is not just in corporations. This is common to people around the
world in all kinds of roles in life. And we’ve found that there’s 13 behaviors that are
common that they use to build trust in their relationships to get results in a way that
establishes relationships of trust, so they can get results again, and again, and again.
JAY: And these are commonalities that when you see these evident, you know
that that organization, that individual, that entity, that enterprise is going to probably be
one of, if not the highest performer. They’re going to probably have the greatest loyalty.
They’re probably going to have a much higher profit rate. They’re going to have a much
lower turnover. They’re going to have a much higher productivity rate, and they’re
probably going to have an incredible culture, right?
STEPHEN: Absolutely. In fact, the data says it’s going to generally be three
times higher, Jay, and often many times higher.
JAY: Those 13 Behavioral Traits would be worth hearing. May we?
JAY: OK. Go for it.
STEPHEN: All right. Well, I’ll briefly go through these. Now, I’ve organized
these around this whole notion of character and competence. The first five behaviors are
primarily behaviors of character. These demonstrate this character, this root system and
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the like. And the first is just straight up - talk straight. That’s being honest, telling the
truth, and using clear, simple language. People like straight talkers. They trust them.
You tend not to trust people that try to distort facts, or manipulate and spin, and leave
false impressions. You prefer people to be real and straightforward with you. That
builds confidence and trust in what you’re saying -- straight talk.
And all of these behaviors, if you want to test it, just try its opposite. When you
talk crooked, does that build any trust or confidence?
JAY: Can I also suggest to you that one of the exercises that we do -- and it’s not
as concentrated on your application. But we force people, in our seminar environments
to list people that they deal with because they manifest, because they demonstrate these,
and to try to break down what it is that they do that is so powerful, and how in the world
they might be adapted. And it’s a very fascinating process, because most people don’t
slow down enough to really recognize what it is about others that so compel them.
STEPHEN: Exactly. Exactly, and so it’s the recognition, the awareness, the
naming of this, so that you turn this into something that’s conscious competence.
JAY: And concrete. That’s good. So the first one is straight talk -- be honest.
Number two?
STEPHEN: I’ve put all these in the form of verbs, so talk straight.
JAY: OK.
STEPHEN: The next one, second one which is part of character, is demonstrate
concern. And that’s basically saying, tell people you care. Respect everyone you’re
working with. Treat everyone with respect, especially those that can’t do anything for
you. Show kindness in the little things. And you don’t try to -- you don’t fake this,
because if you fake that you care, it doesn’t work, Jay. People read through it. So it’s
really developing within yourself the intent principle of, “I do care for people. I want
people to win, and when I work with people, I’m always working the way where I’m
trading value” like we were talking about earlier.
Now the whole idea is it’s not enough to say that’s my motive or intent. Now I
need to demonstrate it. I need to show it. I need to do it. And when you do do it, you’ll
get better results. In fact, one of the great entrepreneurs of the world is Richard Branson,
from the Virgin Group.
JAY: Absolutely.
STEPHEN: And he said this: “If people know you care, it brings out the best in
them.” It’s that simple. If they know you care about them, they’ll trust you. If they
don’t think you’ll care about them, they won’t trust you. These behaviors are all about
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building trust with people, and demonstrating concern is one of the key ones that makes a
profound difference.
JAY: And again, I’ll just give a quick little addition. One of the greatest words I
ever learned in my life was empathy. And I think most people don’t understand the
difference between empathy and sympathy, and in appreciating, understanding,
respecting, acknowledging an observing how someone else sees or experiences life is
such an incredible connector. And I don’t think most people allow themselves to do it.
STEPHEN: They don’t, and they’re losing out on a great opportunity to improve
their world.
JAY: So number two is demonstrate. Number three?
STEPHEN: Number three is create transparency.
JAY: What does that mean?
STEPHEN: I’ll tell you what it means. It means be open. Be real. Be genuine.
Don’t have hidden agendas. See, transparency means openness. The opposite of
transparency is hidden. When people operate with hidden agendas, then people don’t
trust you. If you’re operating with a hidden agenda, you’re not going to be trusted
because people are questioning, “What’s his real agenda? What’s their motive here?
What’s really going on?” They start to wonder.
So instead, you’re open. You’re transparent. You’re real. You’re showing your
hand as much as you can, and you’re trying to say, “Look, I’m trying to help create
something we all can win by. Here’s what’s important to me. What’s important to you?”
But you’re transparent and open about it. You’re counting the truth in a way that people
can verify and validate.
JAY: Don’t you think that in today’s world the more you respect somebody’s
intelligence, and you acknowledge… I always tell people when we do seminars, I say,
“Listen, I don’t have the time to lose you, trying to figure out what my next goal or
motive is. So I’m going to start and spend an hour telling you what I’m going to do, why
I’m going to do it, how I’m going to do it, what the effect is… I’ll integrate so that you
can be very comfortable in the here and now, enjoying the process.”
And when I started doing that, my professional colleagues who sort of were like
the magicians of the world, and wanted to keep the mystique thought that was appalling.
But I got people so in synch with me from the get-go, because it’s respectfully disarming.
It’s like, “Hey, guys. Here’s what we’re doing together. Here’s the path we’re taking.
Here’s what we’re going to accomplish. Here’s how it’s going to work, and then I’ll let
you do it.” It’s a very powerful process.
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STEPHEN: And Jay, not only is it disarming, it creates trust, and it creates it
fast. Because people realize there’s no agenda here, other than what I’m saying, and they
respond to that.
I’ll give you a way entrepreneurs can apply this principle. This may or may not
be the right thing for everybody, but here’s how a lot of entrepreneurs apply the
transparency principle: They open up their books. They have open book management, is
one application of this principle of transparency.
JAY: That’s a beautiful one, and it’s a fabulous approach for people who have
never studied it. The work - I’m trying to remember. Who is it? What’s his name? Jack
Stack?
STEPHEN: Jack Stack.
JAY: It’s a great concept, and… The more vested people are, the more they
know the relevancy of their contribution, and the more they feel valued and participating,
the more is accomplished. It’s been demonstrated over and over again.
STEPHEN: Over again. I was just with a small entrepreneurial company that’s
really on a great growth curve. The trust was low. The CEO and CFO were talking.
“We’ve got to improve the trust. It’s affecting our culture. You know what? Why don’t
we open up our books?” They opened them up, and they showed the financials to
everybody.
At first people were cynical. They were wondering, “What’s the purpose of this?
Are these their real financials?” Because trust was so low, but they stayed with it. Over
time they found this became the single thing, the process more than any other that
transformed their culture, when people realized, “You know what? They’re opening
everything up. They’re sharing it because they’re trying to help us all better perform, and
there’s nothing hidden here.”
JAY: And you know what else it does -- and I’m stepping on you, with profound
respect. What else it does is, one of the big problems, even in a small -- and perhaps
more in an entrepreneurial environment -- is you don’t feel your connectivity to the
totality. The more you feel, and you see, and you understand how your efforts, your
actions, your being, your day-to-day impacts the whole, it’s a much more… I mean, we
all need to feel purposeful and connected.
STEPHEN: Absolutely. And so, Jay, I’m not saying this is the only way you
can show transparency, by opening up your books. That may or may not be the right
thing for you. You decide. But find ways to create transparency, and to be transparent
with how you work as an influencer, as a leader, as an entrepreneur.
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JAY: But opening your books, that’s a great book to review, and I would
commend it. I’ve seen some incredible reports of companies that have embraced it.
That’s a great… Next?
STEPHEN: OK. Number four -- right wrongs. Right wrongs. By that I mean
just make things right when you’re wrong. Apologize quickly. Recover. Make
restitution where possible. Demonstrate some humility. Don’t let your pride get in the
way of doing the right thing. And it’s so simple, and yet so often we find that we make a
mistake, and then we try to cover it up. And in the very process of doing that, we lose
trust. People tend not to trust.
I mean, take Watergate. Yeah, it was a burglary, but that wasn’t what sunk the
presidency. What sunk the presidency of Nixon was not taking responsibility for it. The
cover up was what killed him. And people respond to those that acknowledge they’ve
made a mistake, and they apologize, and they move on. They make it right. They correct
it.
And so I say, make it right when you’re wrong. It actually builds trust. But to not
acknowledge when you’re wrong, and just to move forward like it never happened -- that
tends to dissipate and bleed trust away.
JAY: That’s great. Next?
STEPHEN: Fifth -- show loyalty. By that I mean, be loyal to people. My father

likes to say, “In order to retain those who are present, be loyal to those who are absent.”
In other words, don’t bad mouth people behind their backs when they’re not there to
defend themselves or to represent themselves. Instead, speak about people as if they
were present. Know why?
Because look -- when you speak about people as if they were present and
represent others who aren’t there, what that communicates to everyone that is there is that
you’ll do the same for them when they’re not there. You’re not going to bad mouth them
when they’re not there, or when you have a falling out between the two of you. It
communicates enormous respect, enormous value for people.
But the opposite takes place when you bad mouth people behind their backs, and
you get with someone else and you say, “Look, can you believe what the boss did, or
what this person did?” Then that actually, rather than improving your relationship with
the person you’re talking with, it actually weakens it, because they’re now going to
wonder, “Huh, I wonder if they’re going to bad mouth me if we have a falling out?”
JAY: That’s a great point.
STEPHEN: By showing loyalty, you’ll get -- to those that aren’t present, then
you’ll really have the strength of those that are present, because they’ll trust you. They’ll
believe you’ll be loyal to them when they’re not there. That’s a huge thing.
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JAY: And again, you’ve got to expand the arc of relevancy. Because this relates
to the people you sell to, buy from, employ, live with, impact… This is not a static
concept. This is a very fluid, dynamic and perpetual… It’s a way of life.
STEPHEN: It’s a way of life, and it does affect every relationship. This is
probably critically true more than any place in your homes and families.
JAY: Yes.
STEPHEN: And where you have a reputation of, “I will speak about people as if
they were present. I represent them.” This communicates respect and value for people,
and if you’ll do it for one, you’ll do it for others. If you don’t do it for one, you won’t do
it for others, is the implied perspective when you don’t do it.
JAY: Yeah, that’s great. Next?
STEPHEN: OK, so those first five are really behaviors of character. They’re
primarily demonstrating showing your character. They get manifested through these
ways. Talk straight, demonstrate concern, create transparency, right wrongs, show
loyalty.
JAY: OK.
STEPHEN: Then we go to the next five. These are behaviors of competence

that show that you’re capable. You’re competent. You’ve got a track record. You get
things done.
JAY: OK.
STEPHEN: And this is also part of how you build trust. It’s like I said to you
earlier, Jay, it’s not enough just to have character. You also got to have competence.
JAY: All right.
STEPHEN: OK. So the next one, number six here -- deliver results. There’s
nothing that will establish trust faster with a prospect, with a customer… with anybody
than delivering results. You say you’re going to do something -- you do it. You deliver
the result you promised. You’ve got the right thing done. You’ve made it happen. Then
they say, “Wow! This person delivers. They’ve come through. I can count on them.”
Look at its opposite, Jay. You don’t do it… you don’t deliver… you don’t get the
result and you’re just filled with excuses -- people will say, “Ah, I don’t know if I can
trust him. Don’t know if they’ll make it happen. Something always comes up.”
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So you want to build trust with people, with customers, with investors? Then
deliver. Make things happen. Get the right things done. Build that track record. If you
don’t have a track record, go in, and you’ve got to build it with people. If you have one
going in already, you’re already on first base.
JAY: But you’ve got to be able to sustain it. You can’t live on your laurels.
STEPHEN: You’ve got to be able to sustain it. You can’t live on your laurels.
You can take advantage of being on first base, but you’ve got to get to second, third and
home by what you’re doing today. And delivering result is the fastest way to build trust
in any relationship, because it’s immediate. It’s practical.
JAY: And I want to ask you a question, or make a comment, because I’ve gotten
in some very heated discussions, almost debates, that are parallel to this about value.
Value is not what value means to you. It’s what its definition is to them. And I would
say results…
You might be working hard at the factory on putting it all together, but if they
don’t see the tangible awareness -- the updates, the acknowledgment, the progress reports
-- then you’re really failing in your commitment to them. So you’ve got to be very, very
attuned to what their interpretation of this language and these words are, don’t you think?
STEPHEN: Oh, absolutely. And you have to have a clear understanding of what
the results are that you’re trying to accomplish. Both parties should have it. But then
you need to deliver on it.
JAY: OK.
STEPHEN: We’ll come back to this clarity point of expectations in just a

moment. That’s one of our behaviors.
JAY: OK.
STEPHEN: So delivering results is a key behavior. And it’s so key because

everyone can immediately try to apply this as a means of building trust in any
relationship, especially if the trust is not there yet, or you’re just establishing it with a
new customer. Deliver results for them quickly. Find something you can do to deliver
on, and you’ll immediately begin to build the trust.
We all know this. It plays out in our lives. We don’t trust people that don’t come
through. We do trust those that do.
OK. Here’s number seven: I term it “get better.” By that I mean, continuously
improve. Increase your capabilities. Be a constant learner. Get feedback. Act upon the
feedback. Improve. You’re always trying to get better and better at whatever you’re
doing. You’re building your skills, your talents, your abilities. You’re staying current
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with the change in technologies. Because these are the abilities that you have that will
inspire confidence.
If you rest on your laurels -- you know, “I’ve had all these skills in the past,” but
you’re not current. You’re not improving. You’re not getting better. Then you could
become obsolete, and people’s ability to trust you will go down because they’ll say,
“Well, he’s just not current anymore. He just doesn’t have the right skills today -- the
things that are needed.”
So as a leader, as an influencer, you’re always trying to improve, to get better.

That’s why I like so much you’re doing all the time, Jay, with people, is you’re always
increasing people’s knowledge, skills, attitudes, their ability to accomplish results by
focusing on getting better.
JAY: Well, somebody taught me years ago a phrase that has haunted me. It’s
“Grow or die.” And it applies to you as a being, an organism, an enterprise, a
relationship… And it can be intimidating, particularly when you get, not calcified, but
when you get into a comfort zone.
But if you embrace challenge -- and I get… I mean, everyone knows I have a lot
of trouble with technology. But if you don’t grow, there’s no constant. You regress.
You go one way or the other. People don’t realize it. You have to commit to constant
intellectual, proficiency, emotional, philosophical… If you can’t grow yourself on all
those planes, the only alternative is that you regress.
STEPHEN: Absolutely. I think “Grow or die” is a good way to express this.

I’m putting it in the form of behavior -- get better -- and I’m saying it’s not just a good
principle that will help you as a person. It will help you establish and grow trust with all
the people you’re working with.
And if you’re not getting better, you will actually decrease the trust of the people
you’re working with. They want you to be getting better, and to improve your
capabilities.
JAY: And this is going to be selfish, but I think we all deep down have self-
motivation. You won’t like yourself. You’ll start having contemptuous disdain because
there is a voice within that alerts you, verbally or just in an annoying way, that you’re
being inauthentic. And this is where it comes in, I think.
STEPHEN: Yes, absolutely. All right, here’s the next behavior of competence:
Clarify expectations. Clarify expections - and this goes back to our earlier discussion,
Jay, that you want to make sure that you’ve got common expectations with the people
you’re working with -- with your customer, with your prospect, with your employees,
with your family… whomever you’re interacting with.
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Too often, trust breaks down not because there’s bad people involved, but because
people’s expectations of what’s supposed to happen is different. And they’ve never taken
the time to clarify them, to validate them, to discuss them, to negotiate them. And they’re
not on the same page.
And so one person’s doing one thing, and the other’s expecting something else,
and then they say, “Well, you didn’t come through.” And, “Well, I didn’t know I was
supposed to do that.” But what happens is, without doing this, you’re hurting trust
because people are not delivering on the results because their expectations aren’t in line.
And so by clarifying expectations, it actually is an extraordinary process for

building trust, because in the process of doing that, you’re discussing them, your
disclosing them, you’re negotiating them, you’re validating them. You might even
sometimes re-negotiate them. But you make the expectations clear and shared, and with
that, that actually builds trust, and it avoids the massive withdrawals or violations of trust
that can happen without it.
JAY: And that’s wonderful. Again, one of the things… And I don’t mean to
ever steal your thunder. I mean to just embellish and reflect upon it.
Because I’ve been very privileged to be exposed to 3- or 400 very, very, very
fascinating experts over the years of very unique methodologies. And we had one one
time who believed the key to all clarification was reiteration. In other words, “Let me
write to you or tell you what I think I heard you say, and let me know if that is what in
fact I heard.” And it takes about ten extra minutes, but it’s profound what it can do.
STEPHEN: It’s profound what it can do, and also, it builds trust. I’m saying it
builds trust, which will help you then move with incredible speed.
JAY: But it shows “I heard you and listened, and I respect you.” That’s great.
STEPHEN: “I respect you,” yes. We’re on the same page.
Now here’s number nine: practice accountability. Practice accountability. The

whole idea is this: You hold yourself accountable. Hold others accountable. Take
responsibility for results.
People want to be held accountable, and they want others to be held accountable.
When you are accountable, it actually builds trust. When you try to skirt accountability
and just put blame and the like, that really weakens people’s trust and confidence in you.
And likewise, if you’re not holding other people accountable that are part of your
team, these people need to be held accountable. It builds trust when you do. It hurts it
when you don’t.
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And sometimes people, again, misunderstand the idea of trust, and they think,
“Well, gosh, it’s just all this soft stuff.” Well, believe me, accountability is hard. This is
tough love. This is discipline. But when people are held accountable -- when you
yourself are accountable -- you will build trust in all your relationships. It’s astonishing,
the impact of accountability as a means of growing and establishing trust.
JAY: We’ve actually, Stephen, in some of our coaching activities, installed not
coaches, but accountability officers. And all they would do is hold the client to a self-
affirmed performance. It didn’t matter what. Whatever it was - “OK, you’re going to do
it.” And they would follow up with them two or three times a week, and we saw
productivity go up as much as 500%.
Unfortunately, in my opinion, we all need to be held accountable to someone else,

because left to our own devices we will let ourselves off the hook.
STEPHEN: And my point is this: Not only will performance go up, but so will
trust, which will then help you get future performance.
JAY: Touché.
STEPHEN: All right. Now, number ten - I express it as “confront reality”.

Confront reality. And by that I mean this: Take issues head on, even the tough issues,
even the so-called “undiscussable” issues. Address the tough stuff directly.
As you do that, it actually builds trust and confidence that you’re real. You’re
genuine. You’re not burying your head in the sand. You’re dealing with the tough stuff.
If you ignore the tough stuff and just bury your head in the sand, then people
think, “Oh, they’re not open or honest, or they’re naive. They’re not aware of this stuff.
So which is it?” And they’re both bad. Are you naive, not aware? Or are you not real
and honest with people? You don’t want either of those.
Instead, you want to address the tough stuff, confront the reality, take the issues
head on. As you do it, you’ll actually build trust and confidence in people that you’re a
real, genuine influencer, real genuine entrepreneur and leader. And good things will
happen. Trust will be built from it, compared to the distrust that happens when you kind
of bury your head in the sand.
JAY: And I agree. And only because I promised people we’ll be done at a
certain time, and I have an agenda, for the last ten minutes I’m going to rush you through
the rest, but I think they’re equally as profound. So the next one?
STEPHEN: Let me go through the last three, and let me do them all at once, OK,
Jay? So let me just talk straight through.
JAY: OK.
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STEPHEN: These last three I’m calling “character and competence behaviors”
because they’re really a combination of character and competence -- right smack in the
middle. I couldn’t put them in one category or the other, so I put them in the middle. All
right?
And number eleven is probably the number one way of growing trust than any
other. It’s keep commitments. Keep commitments.
Basically, you say what you’re going to do, then you do what you say you’re
going to do. You make a commitment -- you keep it. You make a commitment to a
customer -- you keep it. If you make a commitment to an employee, you keep it. You
make a commitment to an investor -- you keep it.
You do those things -- you will build trust. You don’t do them -- you’ll destroy it.
You break a couple of commitments -- you might destroy it where you can’t restore it.
So it’s vital that all of us are constantly careful with our commitments, because
whatever commitment we make, we need to keep. But also, don’t be afraid to make
commitments, and then keep them, because by making one and keeping it, you’ll build it
fast with anybody. So make commitments.
Number twelve, listen first. Listen first. The whole idea here is just don’t talk so
much. Listen to other people. Understand what’s important to them, because then you’ll
have influence with them. But if you just try to talk first and not understand you won’t
have anywhere near the influence, and they won’t trust you near as much.
But by going and saying, “I’m going to listen first. I want to understand. I want
to diagnose first” it actually builds great trust. People say, “Ha, this person’s willing to
be influenced. I can trust them more.” And they’ll open up more, and they’ll respond
more to you. Always start, though, with listening.
So this is first, and then the last behavior, number thirteen -- extend trust. The
whole idea here is to extend trust to other people. This is now trust not just as a noun --
as a fruit, a result -- this is trust as a verb, something you do. You extend trust to other
people. You demonstrate a propensity or a bias to trust people.
Now you need to do this carefully, because you don’t just trust anybody. But
here’s the principle: that you learn to extend trust conditionally, though you yourself be
unconditionally trustworthy. But extend it to others conditionally. Use your judgment
and wisdom with them. Those that are earning your trust, you’re careful how you extend
it until they prove more and more. But those that have earned it, you extend it
abundantly, because people respond to that. They run with it.
The former CEO of Johnson & Johnson said, “I have found that by trusting
people until they’ve proved themselves unworthy of that trust, a lot more happens.” So
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you start with a bias of trusting people until they prove otherwise. Trust, but verify -- but
start with trust.
JAY: Those were great. Now I’m going to interject now. That was probably
fifty pages of notes that I wanted to visit, which I knew I couldn’t. I’ve got notes on
organizational trust… notes on market trust… notes on those five points… notes on
social trust… notes on growing trust through all your stakeholders… notes on all your
trust strategies… the four account strategies… I’ve got the tools, and the plans… And
it’s always a disservice -- the propensity for building trust, and how to turn it into a self-
fulfilling process…
And it’s always a disservice when you try to take somebody who’s dedicated the
better part of their life to identifying, understanding, refining, embellishing and perfecting
a power principle, and try to summarily ask them to distill it down to 80 minutes. But
what I promised everybody today was that I was going to do something that I felt a huge
portion would grasp its intangible impact, and see that it had such a relevant, tangible,
financial, measurable, and no-cost, but infinitely and incalculably high yield relevancy to
them that they would want to know more.
I’m at that point now, because I promised everybody that we would take about 80
minutes -- and we did. And we would give them as complete and comprehensive an
attempt at understanding the purity of what you’re all about. And I hope that I didn’t
divert you, because I think you did a masterful job, and I’ve taken more notes than you
can imagine.
I’m so hopeful that those who get me, and get my respect for brilliant thinkers like
yourself, your partner Greg, and your father, get this opportunity. I thank you for being
so generous. And that’s coming from my heart.
Thank you so much, Stephen, for the investment of your time, and for being so
open. And thank you for those of you who understand and appreciate the incalculable
value that resides in this breakthrough area, and can see the kind of potential it can open
up for you. This has been wonderful, and I appreciate everybody, and thank you again,
Stephen. Do you have any parting summary epilogue you want to make sure that they
take away?
STEPHEN: Just this, Jay: I thank you
END
229
Dr. Stephen Covey Interview
Featuring Jay Abraham
May 10, 2005
OPERATOR: Welcome, ladies and gentlemen, to today’s conference call with Dr.
Stephen Covey. Now, here to interview him is business growth expert Jay Abraham.
JAY ABRAHAM: Thank you, Tiffany. Welcome all of you. This is going to be fast
paced, no-nonsense, and I think extremely enriching. I’m very, very honored to have Dr.
Stephen Covey on the line with us for 90 minutes. I’m even more honored by the fact
that he has agreed to allow me to probingly challenge him to take some of his very, very
brilliant and inspired business theories and principles, and allow us to translate them to
very actionable and specific elements that people owning, running a business, a
professional practice, a startup… and people in larger corporations with P&L
responsibility can really take to heart and do something with immediately.
Before we begin (and I’m purposely speaking rapidly because I’ve got a lot of ground to
cover) those of you who aren’t just vividly familiar… Stephen is probably one of the
most influential thinkers in the entire business community. His first book, Seven Habits
of Highly Effective People, sold 15 million copies. His new book, The 8th Habit, is
groundbreaking. That’s all I can say. I don’t want to give away the store until we get
into it about halfway through the call. But it’s transcending the limitations of merely
being effective, and it’s taught people how to be great and achieve greatness for
themselves, their organization, certainly in a business, and also in their lives.
But he’s influenced more people on a worldwide basis, I think, than almost anyone I
know, and his book has been recognized by Chief Executive Magazine as one of the most
influential books of the 20th Century. He’s been recognized in Time magazine as being
one of the most influential people. He’s been given more awards… I’ve got a litany of
awards here, Stephen. If you’ll respectfully allow me to just say it is so impressive and
daunting that I could read it for an hour. Only because I’ve got so much ground to
cover…
He’s a remarkable man who’s got one of the most powerful, agile, halogen-bright minds,
and today we’re going to tap into it in ways I hope and think he’s never allowed to be
really harnessed before.
So with that stated… Stephen? Hello?
DR. STEPHEN COVEY: Hello. My mother also likes me!
JAY: [LAUGHS] This is going to be very fun. And there’s a disclaimer I want to start
with. Stephen teaches that you should be diagnostic first, and not prescriptive. And I
have asked him to basically do what I’ll call a “Pareto Principle” for us today, knowing
that it’s going to be not absolutely the most accurate for all of you. He’s going to do his
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very best at my direction and assistance and prevailing to give you some of the most
universally actionable and primary activities you might consider, and he can disclaim it
as much as he can.
So what we’re going to do today, Stephen, is we’re going to go through a lot of ground
fast. You’ve agreed to let me challenge you, make parenthetical comments, and
comment continuously. We’re going to go through specific actionable ideas,
recommended strategies that business owners, entrepreneurs, professionals, startups and
P&L-oriented managers alike can use to take a needed action.
So with that stated, are you ready?
DR. COVEY: Sounds good -- thanks.
JAY: OK. And he’s given me permission to insinuate my bad self occasionally, clarify
and maybe step on him, because I’m your advocate and I’m your champion, those of you
listening.
So Stephen, would you start with a clear definition of what you define and think
greatness means as it applies to a business versus a large organization? And I would love
any implications -- what it means to a leader, what it means to the team, what it means to
the relationships. But you’re really at a breakthrough area when you talk about greatness.
But what do you define it as?
DR. COVEY: Well, I would say that a great organization would be one that has
sustainable impact on all of its stakeholders for good. That includes the whole supply
chain, obviously the customers… And the culture would be extremely empowered to use
a lot of initiative in making great things happen.
And also, I think another characteristic would be that the people are constantly growing
and improving their skills, their knowledge base, and their capacities to become even
greater in the future. I think one of the biggest problems is sustainability -- that many
people are like cotton candy. It tastes good, and then within a short period of time it just
is worthless, essentially, and nothing happens. But to make it sustainable, to me, is one
of the great keys.
JAY: We had offline, prior to the beginning to this, some discussion. And I said that
I’ve done much of my work with entrepreneurs, with small/medium businesses,
professionals, even a number of startups. And their mindset, even their ideology is
different. And I think that what you’re saying to them is, “Hey, you’ve got to have a
meaningful, sustaining impact on everybody at a higher level than anyone else, and it’s
got to be a lifelong commitment. You’ve got to want to see everybody grow, because if
they don’t, you don’t. If they don’t, your marketplace doesn’t. If they don’t, your clients
or customers don’t.” I’m going to try to interpret you. Is that correct?
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DR. COVEY: That’s right, because it’s an interdependent reality, and most
entrepreneurs have a tendency toward independence. They’re running away from
dependence, obviously, but they kind of like to do things on their own. But I go to these
Entrepreneur of the Year meetings every year, and if you see those who win, consistently,
over all these years, it’s always those that win as a team. And every person’s strength
gets to be made productive, and their weaknesses made irrelevant through the strength of
another person on the team.
JAY: Stephen, I’m going to interrupt for a minute, because -- and we’re getting ahead.
But later in this interview (time allowing) we’re going to talk about creative, you call it
“cooperation.” I’ll call it “collaboration.” But I think that what you have probably
recognized, uncovered and really beat over people’s heads almost incessantly is that you
can’t do it yourself. You need the leverage through other people’s efforts, other people’s
perspectives, other people’s paradigms, other people’s intellectual capital. And I think
more than ever before it’s critical. And for little, medium-sized entrepreneurs and
business owners, I think it’s vital, don’t you?
DR. COVEY: I think that the expression you made “more than ever before” is so true,
because in a knowledge economy, which we’re in now, 70- to 80% of the value added to
goods and services comes from knowledge work. In the industrial age economy it was
only about 30% that came from knowledge work. The rest came from manual work and
from machinery, and that’s why the industrial age model of top down control, on strong
independence at the top, and driving things, and using accounting which makes people an
expense, rather than an investment, and then putting the responsibility on the so-called
“leader” to become the external motivator is an absolutely flawed paradigm.
If you study the great organizations, small and large, that are making the breakthroughs,
you’ll find that it involves a high level of interdependency, empowerment, team
building… all the way along. It’s a different world today, and this is only taken place in
20 years.
JAY: That’s powerful. And what I want to challenge you to keep doing as we get
deeper, because we’re going to “put our toe in the entrepreneur water” a little deeper, and
maybe get up to our knees. But I want you to keep challenging the business owner, the
small or medium entrepreneur, the professional, to relate.
Because you’ve got the good fortune of seeing corporations that at least have the
capability and the mindset of investing forward, building a recurring compound growth
asset. A lot of entrepreneurs, (in my humble opinion) a lot of business owners are very
tactical. (We’ll get into this later.) They are more interested in lifestyle, or more
episodic. And I’d like, and my hope is that you will inspire and haunt them favorably
forever with some commentary that you’ll make parenthetically as we go.
So let me get to the next question. I look at tens of thousands of businesses and
entrepreneurial enterprises every year. In my humble opinion, few of those are really on
a meaningful, sustainable growth path. Even fewer are solidly strategic in their thinking,
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their actions, and their transactions. What instant or immediate, then mid-range or long
term changes or shifts would you recommend any leader -- and keep in mind, we’ve got
them all on here. We have a lot of entrepreneurs and business owners. What changes or
shifts would you recommend they make to convert their enterprise from tactical, reactive,
episodic, to strategic, enduring, and basically a geometric growth machine?
DR. COVEY: I would say a couple of things. One would be I would make sure that I
surround myself with people who are different than me -- who think differently, who
challenge -- so that you can get the spirit of synergy in producing a strategic plan that
everyone gets emotionally connected to. And I would try to get them very involved in
this development of this strategic plan so that they really have a clear sense of what the
most important goals are, and also what the values are. Because if you have
commonality on the values which never change, then you apply those values in getting
synergy and developing strategic goals and plans to achieve those goals. Then you’ve
tapped into as much wisdom as possible.
My experience with most entrepreneurs is that they’re very strong people that are kind of
independent. They want to be interdependent, but their strength kind of causes a “kiss
up” culture to surround them, where people tell them what they like to hear -- and what
they need to hear often gets neglected.
JAY: And Stephen, just so we can translate it to the more entrepreneurial amongst our
listeners… When you say “synergy,” you’re talking about this collaborative creativity,
this collaborative cooperation, this melding of perspectives, of skills sets in an integrated
form. Am I right?
DR. COVEY: That’s right. But it creates a third alternative that is higher than the other
two positions. It’s not a compromise position. And it comes when people get very
vulnerable and authentic, and they overlap their vulnerabilities. And all of a sudden, you
see this magical thing where they start building on each other’s ideas. They get excited,
and kind of a natural, spontaneous enthusiasm starts to form. And that gets people
emotionally connected.
I remember one time when I was setting up my own business, I developed this beautiful
mission statement, perfectly phrased and everything. We went on an off site, and I was
basically going to present it to the team. It was a very small team of about six people.
And a couple started to push back a little, and I could feel my ego kind of being sucked
into it a little, but I did start to listen. The more I listened, the more I could see a different
perspective, and the wisdom that resulted was amazing to me. And within two days we
had an altogether different mission statement than the one I had proposed. And I’m
telling you, it created a sustainable culture that lasted for years and years, that was truly
exciting.
JAY: They were more invested. It was part of… Basically they’d all given birth to it
together.
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DR. COVEY: Exactly.
JAY: That’s great. Stephen, a simple -- well, not a simple question, but on my list it’s a
simple sentence. It’s a fractional sentence. How do you feel a smaller enterprise can best
and most effectively, and greatest, compete today? What one or two factors, actions,
shifts, more than any other, can a small entrepreneur -- and “small” can be $1 million to
$50 million. I don’t really care, however you want to define it. But it’s a very brutal,
competitive world. What can they do more than anything else right away to make them
competitive.
DR. COVEY: I would say there so much slip between cup and lip that you have to be
very careful to get good data and research on your value proposition to make sure that
you really have a product or a service that has tremendous appeal to people, and that
you’re not seduced by your own autobiography, and by a few friends that have told you
you’ve got the greatest thing in the world.
I would also say get synergy on your team so that you make sure that if you’re not strong
in finance, someone is. If you’re not strong in marketing, someone is, so that there isn’t
so much slip between cup and lip. Because as you know, most of the new startups don’t
last two years. They’re gone, and yet they all started with excitement and enthusiasm and
“We’ve got the greatest thing going.” But it’s not sustainable over time, because they
didn’t do the research and the competitive landscape research, looking at the bold
realities of life. And then they didn’t get synergy in compensating for their own
weaknesses.
JAY: That’s good, that’s good. This is a very interesting one. I’m going to give you a
little of my own belief system prior, and I’m going to let you challenge, confirm, or
springboard. I want you to compare the differences, pro and con, between entrepreneurs
and a corporate mindset. And because I’ve done so much work with entrepreneurs and
private business owners, my take on them is this (and I want to see if you confirm or if
you refute it.)
I think number one, many of them are far more passionate because it’s their progeny.
Number two, many of them are more lifestyle oriented. They’re not really trying to build
an asset that will keep compounding, growing, surviving, thriving… Number three, most
of them up to $50 million that I’ve seen, are tactical. Number four, they don’t really
appreciate the relevance of marketing’s key role, and they don’t do the equivalent of
research and development, and they themselves obsolete before their competitors do.
Number five, they don’t reinvest in themselves in training, and reinvest in their team.
Now that’s just my take. That’s a quick Jay Abraham. What do you think the differences
are?
DR. COVEY: Well, my experience is along the same lines, because I find that there is
more a sense of ownership on the part of the entrepreneurs, and real commitment. I find
a lot of them, though, get into very distorted lifestyles. They get so consumed by it that
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oftentimes they neglect their family, and their health, and sometimes their integrity. That
also happens in large organizations, particularly if they get seduced by a “kiss up
culture.”
And I also agree with your comments regarding the tendency to get tactical, and not to
think strategically, and to do the necessary investment in people, and in R&D to make
sure that they really are on a wise, sustainable path for the long haul.
I think that sometimes they are benefited by not being so political. They’re a little more
creative, and they get passionate, attach into their passion. I find a lot of that is just
drummed right out of big organizations, and there’s such profound disempowerment that
most people find their satisfactions off the job, and then it creates kind of a dispirited
culture, where often you’ll find a wise entrepreneur will create a very enthusiastic, fired
up culture of people who kind of buy into the same, particularly if they’re
psychologically and financially involved as well. They buy into the same sense of which
way north is.
JAY: That’s great. I was thinking about the entrepreneur between proactive and
impetuous. There’s this very gossamer-thin line of demarcation.
DR. COVEY: Yeah.
JAY: The next question - you talk a lot about the difference between proactivity and
reactivity. Can you share…? I don’t care what number -- one, three, five, ten critical
proactive things that great leaders do continuously, predictably, that average, ordinary
business owners don’t seem to understand? And then maybe translate what the lesson in
each of these is for the people listening to learn and embrace.
DR. COVEY: Well, I would say one proactive thing is that they decide what their
mission is, and what their values are in the context of a larger vision. And I think that
most reactive people tend to just kind of live out old programs that have been given to
them by other people and by other models that they’ve had.
I think another thing is that they start investing in people and in the building of high-trust
relationships, where the reactive people kind of hope that trust will result. They don’t
proactively nourish the relationship.
Another one is they really get invested in the growth and development of people -- for
instance, the very thing we’re doing here. If they’re learning things from this, they would
want to immediately share this with the people around them that might have an interest so
that they create a kind of a learning ethic -- not just a hard work ethic, but a learning ethic
-- so that people say, “Boy, he’s really interested in my growth and development, and in
my career.”
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I think another one is they strive for a lifestyle that has some balance in it so that they
don’t neglect the thing that they’re going to talk about on their death bed, which is their
loved ones. They take time for it.
I think another one is they set up empowerment agreements with people so that they
don’t have to hover over, check up, follow through, and kind of micro-manage people
according to the way they normally would clone someone. But they realize that every
personality is different, will often take a different tack. But as long as there is a common
agreement on the overall strategic purpose and goals, that’s the important thing. And
therefore, you allow other people to express themselves.
Reactive people tend to be firefighters that are impulsively running to and fro and trying
to solve problems. They almost get addicted to urgency, rather than being addicted to
focusing on that which is important, the Pareto Principle, where 80% of the results come
from the 20% of the key activities that produce those results. And I think that what I call
“Quadrant Two” -- that which is important but not urgent -- is the basic thrust of
proactive people.
JAY: That’s where they live.
DR. COVEY: Yeah. They live more there, and the data shows from research that’s
where they live. Even the Deming data, those who won the Deming prize (and this is
both public and private organizations) against two criteria: economic performance over
time, and high marks from all of the stakeholders.
And these people are living in Quadrant Two -- that which is important, but not urgent --
where most people are drowned by the urgent, and the important often gets neglected
because the urgent acts on you. It’s right in front of you. It’s pressing. It’s like a ringing
phone. And they get so addicted to it they almost feel guilty if they focus on long term,
strategic thinking and listening in depth to other people because they’re frantic. They’re
just driven by action and by constantly wanting to make things happen. They don’t take
time to reflect, and to gain a deeper understanding of what the real needs are, and to also
deeply understand another person and to find out what their voice is... what is unique
about that person…that they have certain talents and passion. They don’t do that. They
talk more than they listen. They should realize they have two ears and one mouth, and
use them accordingly.
JAY: That’s great. You remind me of two things -- one I’m not going to talk about now,
but remind me. Deming was a client of mine, and I learned a powerful way to take
Deming Process Improvement and translate it to the revenue generating, selling,
marketing side. And this is really interesting, and we’ll talk about that sometime.
But I was thinking about -- remember I shared with you that document called the Strategy
of Preeminence? I was very intrigued with the leaders who fell in love, not with their
company, but with their clients, with their team, with the impact they were having on
growing them, on nourishing and nurturing them. They were able to transactionally see
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themselves enriching and improving their circumstance in life. Those people seem to so
remarkably outperform others. I think it’s a really interesting mindset.
DR. COVEY: It is, and if you study Jim Collins’ book, Good To Great, he shows that in
every case without an exception of organizations that were good, but then became
sustainably great, over a long period of time the number one quality was humility -- the
absence of ego -- combined with professional will. They had tremendous, fierce will.
But it wasn’t about them and their career and their reputation. It was about the people,
the cause, the work, and it became obvious to other people. They weren’t necessarily
charismatic people, either. They’re often quiet, sometimes even introverted, but
genuinely caring. They’re sincere, and they’re caring about other people and about the
cause, and not looking for recognition and attention and so forth.
It was a very interesting finding, and I’ve always believed that humility is the greatest of
all virtues, because I think through the humble person can come all other virtues.
JAY: Can I embellish, and say humility connected with humanity, because I think that
transcends it and gives you this real impact.
DR. COVEY: Right. I think that the essence of humility is humanity -- that is, profound
respect and reverence for people and for their potential.
JAY: I agree. And how much more they can be, do, and the impact.
DR. COVEY: And particularly if you invest in them, and don’t see them as an expense.
Because the psychology behind our accounting system is stupid. It’s that people are an
expense. Things are an investment, and assets are essentially machinery and other things.
And that psychology drives external motivation. It drives the “Sandwich Technique” of
performance appraisal, where if you say a few nice words, slip in the knife -- areas for
improvement -- a few nice words on the other end.
Most people are buried in this kind of thinking, this paradigm. It is becoming, little by
little, obsolete. People who want to get at the vanguard, at the cutting edge, better wake
up and smell the coffee about the movement toward a knowledge economy.
JAY: That’s great. I’ve got so many provocative questions.
One of my most, certainly favorite, but I think most impactful of all your beliefs is
beginning with the end in mind. I think it’s a very powerful realization. To me it’s
probably the most powerful single element you teach, and it parallels a lot of the things
that I teach. But how many different, specific ways, areas, have you found it applies that
most people don’t think about?
And I’ll start you off with, when I’m trying to teach people how to grow, not just to great,
but the optimal business or enterprise for them, I say, “Well, let’s figure out what it’s got
to look like.” Because if you continue the way you‘re going… And you know that I
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teach “Three Ways To Grow A Business.” If you don’t make people more profitable and
get them coming back more, you might want to have to grow it very, very, very much
harder and longer than other alternatives. And I try to engineer backwards what it’s
supposed to look like… what has to happen if they’re going to get people buying ten
times, three times… and get them to challenge.
What are all the different ways you have found that people can translate this end of the
mind? Because it goes to structure, size, culture, impact, markets, optimal buyers,
clients… Give me a couple of the distinctions that you’ve seen, and that many people
listening may never have thought about.
DR. COVEY: Well, I totally agree that all things are created twice. Even the house that
you’re in was created in every detail before the earth was touched. The building that
you’re in… everything was created. And that’s what it means to begin with the end in
mind, is that you take charge of the first creation. Then, the second creation is governed
by that first creation. Every decision that you make tells you what to do and what not to
do. It keeps you from getting distracted by things that will consume your energies and
your time away from it.
For instance, I was in a meeting the other day, and I said to a group that was kind of torn
apart with different political issues and so forth, “Why don’t we begin with the end in
mind of ending up with a decision that we all feel is best… better than what anyone has
brought? And that also, the other end in mind is that we are bonded more closely
together. The trust goes up.”
Well I’m telling you, as soon as they emotionally bought into those two things, the whole
meeting changed. Every interaction was more respectful and civil, more empathic, until
eventually the negative, defensive energy was replaced by creative energy. They came
up with solutions that were better. They literally were bonded. They were enthusiastic
about what they came up with. And that’s because at the beginning of the meeting we
agreed on two ends that we wanted to end up with, and that guided everything else.
I think you can do the same thing in your every day, and in your interaction with your
loved ones, or with every person. You just see an end in your mind where it comes out
better, with a better relationship than the way it is now, not that your ego’s satisfied,
because you got your way or because you had all the say, or something like that. But
rather, where you actually produced a result that was beautiful and sustainable.
I think literally, Jay, that you can apply it in every aspect of your life and your --
JAY: I’m going to take that, but I’m going to challenge, not you -- I’m going to use you
as a reflective beam to challenge the business owners, the entrepreneurs, the professionals
here. You really do get out of your life, you get out of your business, you get out of your
career, you get out of your psychic or your financial investment pretty much what you
want it to produce for you. And that starts with, what do you want it to look like? And
then what has to happen backwards in reverse-engineered steps to achieve it?
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I think that there’s so much opportunity here that many people don’t… I think it’s a very
profound and a very powerful area, but I don’t think most people avail themselves of it in
as many ways and applications -- personally, business, self -- as they really could, don’t
you agree?
DR. COVEY: Yeah. I think that you have to be proactive to do it. In other words, you
have to make it happen. It won’t happen to you. And this is also the way that you can
get free of victimism in your life, so that you don’t let yesterday’s bad experiences hold
tomorrow hostage. You literally can reinvent yourself through the power of your mind
and imagination to see a different future.
I was presenting the other day in Aurora, the second largest city in Illinois, and this was
to a group of young people. The president of the university who sponsored this thing,
this large group of young people (mostly high school kids) started interviewing them.
“What is it that you’re most impressed with that you learned tonight?” And the basic
answer was, “I can become the leader of my family.” And most of their families were
dysfunctional. They were broken. And these kids began to get the sense that they could
begin with the end in mind of developing the kind of moral authority that they could
literally become the leader in their own dysfunctional families.
I find the same thing when I work with organizations, that if you can just get anyone at
any level… They don’t have to have position. Leadership is not position. Leadership is a
choice, and it’s based on moral authority. When people envision themselves serving
other people’s needs, and increasing their own circle of influence through solving
problems -- even if it’s not in their own job, but it’s inside their circle of influence -- little
by little people honor those people. They have a reputation. They produce results, and
results gives you so much more freedom with people. They know that you’re interested
in them and in their progress, not just in you and what you’re saying. Little by little, that
person can become what I call a “trim tabber” - the small rudder that turns the big rudder
that turns the whole ship. So you’re no longer a function of some bad boss, or some bad
systems, or a bad economy. It’s not a function of the environment at all. It’s a function
of your own decisions based on a lot of wisdom that is not ego-centric, but which really
tries to add value to others.
JAY: Stephen, I’m going to pounce on something, because again, I’m the
advocate/champion of everybody here. And there are people representing huge
corporations, but there are a lot of them here from medium and small and entrepreneurial
type sorts. And I want to challenge you to challenge them.
You talk constantly and impressively about being a great leader. But I want to know why
must a business owner, large or small, professionals alike, entrepreneurs, startups, even
one-person businesses… be leaders too? And what does that level of leadership look
like? Give me an example. Give me absolutely -- absolutely -- a picture. Because I want
to try to help people not have to extrapolate… not have to conjure up… not have to try to
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grasp and grapple with an image. What’s it look like? (And if you can talk a little
louder… I’ve been told that you’re a little soft on a couple of the people’s phones.)
DR. COVEY: OK, I appreciate that feedback. I’ll try to speak a little louder.
JAY: Thank you very much.
DR. COVEY: Now, first of all, leadership is the enabling power to everything else that
takes place. For instance, if you have bad leadership and you’re in a school, you’re going
to get bad education. If you have bad leadership and you’re in a health care organization,
you’ll get bad health care.
It is the enabling profession to all other professions. It is the highest art of all -- literally.
Even artists need leadership… need some kind of vision… some kind of strategic
directioning… some system of accountability, of nurturance, of a servant leader. And
that’s what leadership provides.
And the essence of it is that these people don’t necessarily have a position. Like Gandhi -
he was never elected, never appointed. He brought England to its knees, liberated 300
million Indians. It’s the second largest country in the world today -- one billion people --
and the largest democracy. And he was the founder of it, and never held a position.
The industrial age model makes leadership a position. The knowledge economy -
leadership is a choice. I mean, look what GE did in distributing leadership throughout all
of their different areas. They became number one or number two in every category that
they entered into because they focused primarily on the process of developing and
distributing leadership all throughout their entire culture.
Look at Southwest Airlines. Look what they’ve done to nurture leadership in every area,
and the modeling done even by the top people of being willing to be servant leaders… to
assist other people… to empower them so that that one organization is worth more,
probably, than all of the other airlines put together. It’s the most successful of any airline
we’ve ever seen, and it’s because of the kind of leadership. It isn’t the kind of rah-rah,
charismatic leadership of someone up in front leading the charge up the mountain at all.
It’s the one that confirms to everyone, “You matter. You make a difference. I want to
listen to you. I believe in you. Find your voice, and then align your voice with the voice
of your department or your team so that there’s harmony there, and let’s put forth the best
low-cost airline in the history of the world.” And that’s what they’ve done.
JAY: And Stephen, I’m interrupting -- apologies. But entrepreneurs, small business
owners, medium business owners, startups, professionals… they feel sometimes so
competitively marginalize, so commoditized, so beleaguered. How/why must they -- and
can they -- transform themselves into leaders within their community, their group, their
business, their industry?
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DR. COVEY: Well, I think they first of all should realize that it is an inside-out process.
They’ve got to literally work on themselves… take more initiative to bring the people
together to come up with a strategic direction, with values, and with a vision that people
can emotionally connect to. And that is almost the first activity that such people do.
Once they get that going, then their spirit is kind of a servant leader, to “How can I
remove obstacles for you? What can I do to help you further what you’re trying to do?”
Rather than in a sense, taking over and continuing to provide all of the direction. That
way it starts to distribute the spirit of moral authority, or living by principles, throughout
a culture.
And so these are very practical things that an entrepreneur or startup person can do. Even
if there’s only two or three people, get together with those people and say, “What is it
that’s really important to us, and how are we going to execute on that? And who will do
what role to make that execution?” And that way I think it causes a feeling that everyone
is important… that no one is any more important than anyone else… that everyone is
special because of the quality of humility and the quality of respect that is shown by this
owner/manager toward everyone.
JAY: I think you’ll agree… You may not, but I think that when you transform yourself
into a true leader it animates your spirit. It stretches your sense of possibility, and it
really renews your passion and purpose for what you’re doing, don’t you think?
DR. COVEY: It does feed on itself. It’s also a magnetic in the impact it has on others.
By the way, am I speaking loud enough?
JAY: You are, and I think I was too. So I hope everyone can hear. Tiffany, not to be
rude and breach the integrity of our interview, but I want to make sure everyone listening
can hear clearly. Are we fine now?
OPERATOR: Yes, sir.
JAY: OK, thank you. There we are, Stephen. We’re good.
DR. COVEY: OK, good.
JAY: Let’s see. I’m going to move rapidly along here.
You talked in I think both of your books about the difference between doing things right
and doing the right things. And again, I challenge you so that while there’s no true
prescriptive be-all and do-all, help me help the people on this call, particularly the ones
that aren’t running trillion-dollar corporations -- the ones that are struggling with a $5
million, $10 million, a startup… help them see what are the real categories they’ve got to
deal with right away, and why, and what’s the flaw in their current thinking?
DR. COVEY: I would say the two big categories are strategic and relationship.
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JAY: Can you describe strategic? Because I’m always…
DR. COVEY: The strategic means that you’re focusing upon what are the over-arching
purposes you’re trying to serve? And what is your basic value proposition, or your basic
good or service that can serve that in the markets that you’re going after? So that you
have to think through what those big goals are, and the main plans to accomplish those
goals.
Most people don’t think strategically. They think more tactically in terms of “What am I
going to do today to put out this fire, or to build that one relationship” or something of
that nature. But you need a context in which to operate in which everyone can operate.
People should be on the same page about that strategic context.
The second thing is they focus on relationships. I remember one organization I worked
with, I said, “If you were to do one thing that you know would have the greatest impact
on your store, your operation, what would that be?” They thought about it, and to a
person (they were all department heads) they said, “Spend more time with our big
customers, the ones that we sell the most to, and really get to know them, to understand
them, and to serve them so that their loyalty is so strong toward us they think no one
else.”
I said, “What percent of the time are you spending on doing that?” They concluded no
more than 5- to 10% of their time. Why? Because they were buried by firefighting, by
reports, by meetings, by little minutiae, with oftentimes the 80% of the customers that
really were consuming their energies and their best time.
So they came up with an agreement. They were going to spend one half their time with
the big customers. That really involved a lot of proactive, courageous action on their
part. Within about six months they’d got up to about a third. You cannot believe the
impact that had on results -- and on their spirit, like you say, Jay. The moment you get
this momentum going, and this enthusiasm going, it becomes contagious and it fires them
up to not only know what they should do, but also to have a “not-to-do” list that they stay
away from that consumes them, that if you neglect would make no difference at all
anyway.
I find that’s a very useful question to ask people, Jay, and that is -- Because usually
people kind of inwardly know what is the one thing that if they attend to it can make a
huge difference. They usually know what it is, but they’re just so reactive that oftentimes
all of the other things drill away their energy.
JAY: And you know this -- I’ve done lots of very fascinating and powerful research and
experimentation. We’ve found with certain kinds of businesses where the leader can, on
some frequency, interact with the best clients -- or even prospects -- businesses have
grown 40-50%. It’s like an instantaneous exponential leverage.
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DR. COVEY: Wow.
JAY: But they don’t think about that, because you’re right. They’re so immersed and
beleaguered in the day-to-day and the alligators. Let me continue, because I’ve got so
many questions, and I know you’ve got to go to a plane when we’re done.
Let’s see… this is good. You talk a lot about problem minded versus opportunity
minded. I talked about ethical opportunistic mindset. Let’s reconcile and define the
differences, not necessarily in mine, but your two differences. Illustrate them with some
very specific reference examples so there’s no question in the minds of our listener what
the two look like, and where they’re diametrically different, and what the different
impacts and outcomes can be. Then re-examine a few of them -- maybe great
opportunity-minded leaders, thinkers, or organizations you’ve seen, worked with, or
admired. And maybe (time allowing) give us a lesson or two we can each take from that,
or any part thereof, OK?
DR. COVEY: OK. I worked with one the other day that is a fantastic organization
because they focus on opportunities, and they kind of relegate their problems to their
mentee. They all have a “mentee” -- someone that they’re trying to train to kind of take
over part of their business. It gives the mentee opportunities to also make opportunities
out of some of those kinds of small problems. But they essentially just push them off to
these mentees, these people that they’re trying to train to get into the business, and to
learn the business. They literally are focusing almost all of their energy where the new
opportunities are coming -- the new technologies that are coming, or the new changes in
the competitive landscape where a competitor is using a strong relationship-building
approach.
And so they not only go into the relationship thing, but they also go into it synergistically
so that they don’t just have a good relationship. They actually become very open to the
customer and very aware of the new forces that are operating on that customer to where
they know what the customer’s customers are thinking about. They begin to see what
these trends are like, and so they organize themselves to focus on these trends.
You can’t believe the impact to this organization. It’s now a $6 billion organization, but
it’s made up of small operations of no more than two or three people -- well, sometimes it
may be up to six or ten people at the most -- in different offices. They have 10,000
offices, and their goal is to make 25,000 in the next few years.
But this is their approach that they use, and that is that top people of each office attend to
the opportunities, the changes that are taking place in the marketplace, where the big
customers are, and what’s happening to those customers’ customers, their businesses, and
so forth. Then the rest of it they’re delegating to these trainees. They’re helping them to
learn the business, and to get involved. It’s one of the best models I’ve ever seen.
JAY: That’s great, that’s great. I know we could tape you for two hours on any subject,
so respectfully, if I move on, know that it’s not --
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DR. COVEY: No, that’s fine.
JAY: Good. Then this is -- time management is obviously important to everybody, and
your corporation’s very deeply ensconced in it. But I did a program years ago called
“The eX! Factor” and I culled the minds of experts in every distinction. And I wanted
them to give me in five minutes or less the most highly leveraged single transactional
approach that somebody could use to master one big impact point that even if they
executed marginally, it would have a profound difference.
That stated, because no one has more than 24 hours in a day, or seven days in a week…
What, if your life depended on it, and you had, in three, or four, or five minutes, to give a
system for making each and every one listening at least 10, 20, maybe more percent more
productive, effective, impactful in either time management or productivity, what’s the
one thing you would tell them above everything else?
DR. COVEY: Well, I would say first of all, write a personal mission statement that
embraces the totality of your life. Second, I would say, think through each of the
important roles of your life, such as your business roles, your family role, your
community service role, your personal welfare, and health, and growth role, and your
church role -- whatever.
Then, never think in terms of a day. The smallest unit would be a week, and that is in the
larger context of long term thinking over several years, or maybe a year, or a quarter, or
something like that. But always think in terms of a week as the smallest unit. You can
still be flexible and adapt spontaneously to changing circumstances, but that way you can
attach key goals -- like one or two -- to every role and schedule it. You’re still not hung
up on the schedule. It’s more your conscience that drives it. But you will find that about
80% of the goals that you’ve established under those key roles will be achieved.
At the end of the week you look at what you’ve not accomplished and then plan the next
week so that you don’t neglect anything that is truly important. Otherwise, what I find,
Jay, is that people truly do climb ladders of success, get to the top rung, look around, and
realize it’s leaning against the wrong wall because they have neglected some key roles in
their life. “Of all of the words tongue and pen, the saddest of these: ‘It might have
been.’”
This can often happen to entrepreneurs particularly because the nature of the work can be
so consuming, not just time-wise, but in terms of their attention and orientation, that they
can often neglect the more important things that they know in their heart are more
important. And they neglect it not only through this constant pounding of the surf out
there, but also because they don’t empower other people to compensate for their
weaknesses. They don’t know how to empower them, so that they’re too dependent upon
their own individual action, and they end up neglecting the most important things.
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So I would say mission statement, then roles, then goals, and keep the smallest unit on a
weekly basis. Those people who plan on a daily basis, I’m telling you, they are buried in
the thick of thin things, and they’re going to spend their time putting out fires until they
develop a problem orientation, not an opportunity orientation.
JAY: I had a person at one of my seminars who was very, very interesting. He worked
with CEOs in Silicon Valley, and we asked him a similar question, and I want to throw
this out to you because his answer is going to be a real softball for you to hit out of the
park, I think.
He said, “Pick out the three most important functions you do for your company, even if
you’re a one-person business. Break them down to the six or seven most relevant
processes. Judge your relative proficiency at it.” And this is going to be very interesting
to you, and I’m going to put some funny words in it. He had a different criteria, but he
said, “Going from imbecilic to terrible is pretty linear. Going from good to great, or
spectacular, or extraordinary is geometric. Do what you’ve got the greatest leverage in,
and don’t do what you don’t.” Now, I don’t know if you agree with that or not.
DR. COVEY: No, no. I think that these are what I call “The Four Disciplines of
Execution.” The first one is to decide what those two or three superbly important goals
are. Like, to a flight controller, is to make sure that that plane lands safely, otherwise you
close the airport down. To a surgeon, that guy lives. You should have two or three, and
that’s all. You still will have other things, but those are your, what I call “WIGs” --
Wildly Important Goals.
Then, by involving people not only in developing the WIGs, but also the scoreboard that
reflects that so that everyone knows how that would be measured.
Third, you then have opportunity for everyone to be creative in coming up with new and
better behavior in accomplishing those things against the scoreboard.
Fourth, that you have open accountability, so that everyone has awareness of exactly
what’s happening -- it’s published, it’s open to everyone -- against the scoreboard.
I was working with the Governor down in Georgia, and we set up a control group of five
departments and a training group of five departments, and applied these four disciplines
of execution in the five departments. In a matter of six to eight months the results were
so astounding that the Governor adopted it for the entire state. He said, “We’re going to
be the best-managed state in this country.” I said, “Your goal is too small. You have to
be the mentoring model for the other 49 states.”
But these people did this on their own. It’s not something we did to them. They came up
with the WIGs. They came up with the scoreboard. They held everyone accountable.
Do you know what they had before? 20 or 30 goals… the distraction… no one on the
same page about what really is terribly important. They didn’t have the scoreboard that
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they developed. It was more handed to them by someone else, and their whole culture
was in a sense disparate and split apart.
The same thing with the small operation -- to decide the two or three truly significant
things, and the scoreboard, and then hold everyone accountable to come up with new and
better ways to accomplish that.
JAY: I’m going to pick up on that, and I’ve just had to shuffle some notes, so bear with
me.
I did a lot of research in the highest-performing companies in 300 to 400 fields, and I was
fascinated. They, to me (and this is my interpretation) were the companies that
engineered the maximum quality, consistency, and significant breakthroughs in the area
of strategy, marketing, innovation and management -- those four things.
You talk about the four primary management practices -- strategy, execution, culture…
what’s the fourth one? Is it people?
DR. COVEY: Yeah. No, that would be culture. I guess the other one is modeling --
your own example.
JAY: And you want to talk about any one of them? I’m trying to give leverage that’s
actionable. I want no one on this call not to be able to hang up and say, “I’m going to do
that starting today,” and they know what “that” means -- at least as a starting point. It
may not be, as you said, prescriptively the ultimate, but it’s better than groping for what
to grab.
DR. COVEY: I would say four things. One, be sure you’re a good example yourself of
what you are trying to illustrate in your principles… that you yourself have this integrity,
and this trustworthiness, and this openness to being influenced by others, and humility as
well as tremendous willpower.
Second, I would say get people on the same page about this vision and these overall goals
and the value system.
Third, I would, once you have a buy-in to those strategic criteria like vision, and strategy,
and values, then look at your structures, systems and processes to make sure that they are
in harmony. Because usually they’re not in harmony. They’re obstacling. It’s what I
call the “aligning role,” and that is one tough activity.
And then fourth, empower people to be creative, to have autonomy within the context of
the agreed-upon criteria.
Those, to me, are the four roles of leadership, and the people on this call could say, “I’m
going to be a better model starting with myself. I’m going to involve others in coming up
with the strategic criteria. Third, I’m going to use those criteria to look at every structure,
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system and process to make sure that they are nurturing and in alignment. And fourth, all
of this is done so I can help people find their voice and really use their own unique talent
and passion in coming up with better, more creative ways of accomplishing these wildly
important goals.”
Now, those are four very practical things to do.
JAY: Great, those are great. And again, I’m very respectful of your time. I’m going to
get to the 8th Habit book, and then we’re going to talk about voice in about three minutes.
I have one other really important question, because I think it transcends the bridge
between effective and greatness, and most people in small- or medium-sized businesses
and professionals don’t get this at all.
I’d like you to give us a three-minute short course primer, complete, if you can, with at
least one reference example on empathic listening, hearing, and acknowledgment, and
why it’s so relevant.
A few years ago I was training Indian chiefs that run Indian nations in North America.
At the end of three days of training they gave to me a gift. It was called the Indian
Talking Stick, and they even had my name on the back side, “Bald Eagle.”
Well, the Indian Talking Stick is the greatest single communication tool I have ever
learned. They taught this to the founding fathers of our country -- the Iroquois Federation
did. It basically is this: Whoever has the Talking Stick alone can speak. No one else can
speak. All they can do is try to understand, and to reflect their understanding of the other
person’s point.
That requires empathic listening -- that is, you listen within the frame of reference of the
other person. Very few people have been trained how to do it, and that’s the power of the
Talking Stick. It is a physical discipline that if people will exercise it, it will literally
train them how to listen empathically.
Unless you listen empathically -- that means within the other person’s frame of reference
-- you never really understand why your customers don’t buy your products and services.
They just tell you what’s safe, but not what really is driving their buying behavior.
You’ll never really understand what the unique talent and passion of your own people
are, because if you have formal authority, they’ll kiss up and tell you what you like to
hear. And then, you’ll read your autobiography, and you’ll prepare your reply. You’ll be
patient in preparing that reply and call it listening, but it’s not. You’re still in your own
autobiography, your own frame of reference.
You’ll never really understand how to build your supply team like Dell does, or like
Toyota does. That’s why they’re eating Detroit’s lunch, because they have put their
suppliers on the same basis as their own employees. They’re all part of the team, and
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they give so much knowledge about the industry, about the competitive landscape, about
the company… But anyone can close down that line, and so they’re all committed to the
quality you’re thinking about -- and also to being innovative.
But this comes from this deep, empathic listening, which is a skill that very few people
have had more than two weeks of training in. I asked a group today (there were 500
there) how many have had two weeks of training in empathic listening. There were
twelve people that raised their hands. And yet, we’re spending I would say 2/3 of our
waking hours in some form of communication -- reading, writing, speaking and listening.
Research tells us that 40% of that time is spent listening. But most people are pretending
to listen. They’re preparing their reply, and they don’t really use the Indian talking stick
like they could use it.
And I’m telling you, once you start, the whole nature of the relationship is altered.
People start getting more creative, less defensive, less protective. You don’t agree with
them. You don’t disagree with them. You don’t read your autobiography.
You don’t even ask them questions, because the moment you ask them questions, you
control the visit -- your questions do. Well, what if these people have tender feelings
inside they’d like to get out, and then someone else intellectually directs them by asking
them questions when in fact, the thing that’s controlling their behavior is something
they’re hesitant to speak about unless someone else basically can read with their eyes and
with their heart. “There is something going on inside that customer, or inside that
employee, or inside that supplier that I’m not in touch with. I want to listen.” They
communicate the desire to listen, and they do listen and reflect accurately.
It’s just amazing, Jay, how open people can become, and how authentic they become.
When that happens, bonding takes place. When bonding takes place, people don’t bad
mouth each other behind each other’s back. They’re very authentic and genuine, and
integrity begins to take the place of duplicity, and pretending to listen, and playing
pseudo-democratic games, and calling it involvement.
JAY: That’s great. I’m trying to remember -- one of the really profound Eastern
philosophers (and I’m going to paraphrase it) said that the key to everything was your
ability to not necessarily agree, but to respect, understand, empathize, acknowledge,
embrace, and really understand. And you talk really profoundly about this. But I think
most people don’t recognize how important it is to hear and acknowledge the other side’s
point of view or perspective.
DR. COVEY: It’s the equivalent of air to a body.
JAY: And it’s probably the greatest power tool you’ve got, and it feels so good to slow
down and hear what people say, don’t you think?
DR. COVEY: Particularly if you do it genuinely and sincerely so that you are
influenced. As they sense that you understand -- not necessarily agree, but that you
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understand, and that you’ve been impacted, they become extremely open to your
influence.
JAY: And just so we’re clear, that’s not abstract rhetoric here. It translates totally to
your ability to communicate, in your selling communications, in your management
communications, in your buying/negotiating communications… It’s really the secret
weapon, don’t you think?
DR. COVEY: I do. I was with a person the other day in Chicago, and we had them
report on their experiences in practicing this. And this man said, “I’ve been selling to this
one customer to where I had no other customers. All my eggs were in this one basket,
and we were reaching the point where it looked as if she was going in another direction.
I just inwardly panicked, and said to myself, ‘You know, maybe I should just try what
Stephen has been teaching me today.’ Because it looks like all the ways I’ve tried to pull
this thing out of the fire are not working.”
So he said to her, “You know, let me see if I can understand, really, what your concerns
are.” And he did the best he could to restate her concerns. He did this for just a few
minutes. She interacted a little, and he continued to restate it. And then she said,
“Excuse me a minute.” She went over, picked up the phone, talked to her husband,
turned and said, “You’ve got the deal.”
And he said to me, “I couldn’t believe what happened.” I said, “Do you know what the
dynamic behind that is? As soon as she felt that you’d paid the price of showing that
depth of respect and understanding, she became open to the fact that you have been
spending all these months working on her case, and that other things being relatively
equal, it was going to go in your direction. But if you had not -- if you had just kept
coming forth with your logic, and your persuasion, then you would be on the same
footing as anyone else. And if the other person seems to be a little better in some
technical aspect, it’s going to go in their direction.”
JAY: That’s great. And a case in point, just in my role as advocate, you’re doing that
exactly. You’re hearing very precisely what I’m saying. You’re being very sensitive to
the needs of the listener, and you’re acknowledging them through your response, and it’s
very resonating.
I’m going to move, because I feel like a kid in a candy store. I’ve got pages of questions
that if I had more time I’d like to ask. But I’ve got 15 or 18 minutes, and I’ve got to be
very selective, so I’m going to move to your newest strata of thinking and direction. I
want to talk about The 8th Habit a bit. And before we talk deeply about it, I want to ask
you just a straightforward question: Why an eighth habit?
DR. COVEY: Well, it wasn’t until I became aware of the movement from the industrial
to the information/knowledge worker age that I even had the idea of The 8th Habit. I had
a leadership book pretty well already developed. But as soon as I discovered how
dynamic this movement was… It’s as dynamic as the movement from the agricultural
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age. The impact is so tremendous… And I think that most people do not have any clue of
the impact of this information/knowledge worker age… how it will literally improve
productivity, not just ten times, but 50 or 100 times. In software development it is 10,000
times.
As soon as I got hold of the idea of the importance of intellectual property and of
intellectual and social assets -- and “social” means the quality of the trust between
people. As soon as I got hold of that, I had to rewrite the whole book. And then it was
“The 8th Habit,” because it’s like the third dimension to the other seven.
I sometimes ask audiences to close one eye and look, and you see, in a sense, one
dimension of life. As soon as you open the other eye you get three dimensions. And
that’s what it is.
The 8th Habit is a personalization of general truths. It’s kind of like coming to your own
personal truth. It happened to me.
When I was a young man I was going to go into a family business. I was geared that
way. My dad put me through the Harvard Business School to do it. But someone got me
involved in teaching and training leaders, and I found a level of satisfaction that gave me
the rest of my life. And I remember saying to my dad, who had always, I could
remember, said, “If you can do it, you do it. If you can’t do it, you teach it.” And I
always said within myself, “I don’t know how my dad’s going to respond to this.”
Anyway, I told him after the Harvard Business School, I wanted to become a teacher.
And he said to me, “You know, I never found my voice in business either. I found my
voice in developing visitor’s centers in my basement, and I had to develop a Renaissance
mind to do that.”
I find that most people have a deep hunger for greatness in their life. They really do.
They want to make a truly significant impact for good. They want to optimize their
talents for good. They want to be more than just being effective.
I find that’s a deep hunger, and that most people -- I can ask any group, “How many
agree the vast majority of the work force have a lot more intelligence and capability than
their jobs even allow them to use?” They’ll all raise their hands. They’ve lost their
voice.
The knowledge worker age requires people to use their voice if they’re going to succeed.
The industrial age drowns out their voices and disempowers them, because it’s based on a
control model. It’s not based on an unleashing of human talent.
That’s how I got into all this material, and since I’ve gotten into it, I’ve had so much
affirmation from so many sources, Jay, as to the power of it… of people who have said,
“Yeah, it was this teacher, or this boss, or someone that believed in me when I didn’t
believe in myself. That’s what made all of the difference in my life.”
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JAY: Now I’m going to try to do justice to the real impact that I think the book has
made, and is making. But if I don’t ask the question with clarity, you amend it for me.
So the first thing -- and you’ve gotten into it, but specifically, let’s talk about what
people’s different personal significance can be. Because I think that particularly with the
entrepreneur, with the professional, you’ve got a very beleaguered group of people in our
society. They go out and they slug it out, and they’re feeling beleaguered instead of
feeling great. They’re feeling passionless instead of passionate. They’re feeling
somewhat purposeless, and they’re tactical, and they’re…
And I think that you have the genesis there of what will transform more people to not just
greatness in their performance, but greatness in their fulfillment, don’t you?
DR. COVEY: I think if you ask four questions of yourself… What is it I really am good
at? What is it I really love to do? What need can I serve? And what is life asking of me,
where a person listens to their conscience. That is, you’ve tapped into your mind, your
talent -- that is, what am I good at? Your heart, your passion -- what do I love doing?
The physical side is the economic need that you’re serving in society that can drive your
economic engine. And the spiritual side has to do with, what does your conscience tell
you to do in this circumstance, or this situation?
If you can overlap those four things, I think a person can find their voice. My experience
is with most entrepreneurs that they have found their voice in that way. Sometimes they
haven’t. Sometimes they’re beleaguered and beat up. But I think that my experience is
that they are so turned on…
The problem is they don’t often surround themselves with people who think differently,
and who can compensate for their weakness to where they appreciate their voice, so that
you create kind of a harmonious chorus, as it were, of people that really know how to
work together in the use of their voices.
JAY: Now, I want to amend what I said. I agree with you, but I also want to clarify. I
think that entrepreneurs start out, by and large, with a great vision.
DR. COVEY: Yeah.
JAY: It’s abstract. I think that because they don’t understand how to harness what I’ll
call the “jet stream,” (and I’ll use your principles as a vehicular vessel to do it) that their
lack of validation, sometimes… their lack of control… their lack of impact… their lack
of fulfillment -- hardens or jades them of the extraordinary might of that passionate…
that lava that’s waiting to explode below. And I think letting it out, if it can be
channeled, is incredible.
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DR. COVEY: Yeah, and that’s been my experience as well. And it is, and you don’t
have to motivate these people, because you tap into something. Sometimes people get
seduced by their present skills, and their skills may not be where their real native talent is.
I believe that when we were born, that our work was born with us…
JAY: That’s interesting.
DR. COVEY: … And that a big part of that work will take place -- probably the most
important part -- in the four walls of our own home. That’s why I give such emphasis to
making sure that you have a lifestyle where people are empowered around you so that
you have life balance, and you keep your foot on solid ground in the key areas of your
life, and that you don’t just lose something because of the sheer pressure of firefighting in
another area. That’s why you need to have a complementary team.
By the way, in every one of the 16 chapters in this 8th Habit book there is a video. It’s on
a DVD in the back. A lot of people are visual learners today, and if they will watch the
video, the essence of it, and also their emotional connection to the material often takes
place even more than the content of the particular chapter.
It’s taken us many years to produce those videos, and I had quite an uphill fight with the
product department, because these are their training films that they often sell. Plus, we
had a problem with Simon Schuster, the publisher. They didn’t see the vision,
necessarily, of this. They can’t see readers doing a DVD as well, but that’s…
JAY: It’s very impressive.
DR. COVEY: But it’s happening, and some of these are really outstanding films that
illustrate what’s happening.
JAY: You’re right. Each one denominates a different chapter.
I’ve got to reconcile an implied, not a problem, but an issue in those four points you
made earlier. So conventional management and business growth wisdom says you
basically, nose to the grindstone, go forward with vim, vigor and alacrity. Is doing those
four functions going to potentially reveal that you’re in the wrong business, or is it going
to liberate even more and multiply even more productively and intensely all that power
and energy that resides within you?
DR. COVEY: I think you could go either direction. If you have really a complementary
team, where people will speak up and do research, you may find you’re in the wrong
business. If you find out that you are in the right business, and you create a
complementary team, so that you have people’s strengths being utilized, and their
weaknesses made irrelevant, I think you’ve got a real leverage factor there that can make
your business tremendously successful. They should be tied in. They should have a
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sense of ownership, psychologically and financially, so that they’re really part of this
thing.
JAY: It’s interesting, and I’ve got to point this out. I do (and you know this) programs
all over the world training business owners how to be greater in performance and
profitability and dominance. But they all come to me with a business they want to grow.
They don’t come to me and say, “Should I stay in this business?” And it’s a real
interesting dilemma, because you see people with different skill sets, with different
challenges, who have not set themselves up necessarily with a business that can be
maximized either in its asset value…
It’s very interesting, and people think there’s shame in reevaluating the direction of the
rest of their lives. I think it’s probably one of the most strategic things you could do.
What do you think about that?
DR. COVEY: I know. I totally agree. Why is it that over 90% don’t make it to the
second year? A lot of that is operations, but I’d say most of it is they got seduced by their
own enthusiasm. I can tell whether a book will work right off the bat -- whether that
book is written for the reader, or written just to have the writer get across convictions.
You can tell almost instantly whether it’ll work or not.
JAY: Yeah, and I think there’s a real interesting relevance there. Let me - I’ve got about
five more, and I know you’ve got to go.
DR. COVEY: Oh, that’s fine. I’m happy to visit.
JAY: You’re very gracious, you really are. I want some specifics so that there’s some
reference examples, even if it’s just modeling, or poster boys or girls for us to see. Give
me a couple of examples -- very quickly, because I’ve got about seven more questions I’d
love to ask before you have to leave -- about where you’ve seen others make the biggest
difference. And if you could use an actual little case study, a scenario, an illustrative
example… I’m looking for highly specific examples that the listeners, whether they are
the manager of a billion-dollar company, division… whether they are an
ophthalmologist… whether they are a $20 million distributor of products, services…
whether they are a software company… Just some examples that they can use to vector or
calibrate their sense of what greatness might be like for them. It can be either companies,
individuals, team members.
DR. COVEY: Right. Well, I had an interaction with the Human Resource Director the
other day with Ritz Carlton, and she had been pretty much beat up in her growing up
years. But she got into a very empowered culture. And I asked her what impact this has
had. She said, “Not only has it changed my professional life -- it’s changed my personal
and family life. I have learned how to have the attitude, ‘It’s my pleasure.’ It’s a
pleasure to serve another person. That spirit has so influenced my opportunity that I can
literally get an audience in the throne room anytime I want with the top decision makers.”
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Another one was a person that accidentally killed someone and was found guilty of
manslaughter, but got this proactive muscle going, and in a matter of about six months --
in jail -- changed the jail, and the culture inside that jail.
Another one -- this was a person that was setting up a new business in the field of
insurance. They just started building a team of three people who had totally different
strengths. This was contrary to what his natural tendency was, but he knew he needed to
have a complementary team. So he found that by the two or three of them going to their
clients to show the team power of selling to these clients, that they developed a huge
business based on team selling that he otherwise never would have done.
Another one -- I went to a service station (because it became a fast foods store.) So I
went to another service station and said to the guy, “How would you like a special deal?
You take care of all my cars, and I’ll give you all my business.” And he said, “Mr.
Covey, I’ll take care of your cars as if they were my own.” And he does. Then he
decided to go to his neighborhood, and he got 20 other families to do the same, exact
thing. He has to compete against the majors, and he can’t do it when there’s price wars
because the margin is so small on gas. But he makes so much in services, and on the
back end.
I just find that anyone who’s proactive, and who’s creative and innovative, if they will
just learn to empathize with the market and with the people, they can, in a short period of
time have a much, much larger circle of influence, and have a very profitable operation.
JAY: That’s great. Now, let me ask you, just so I’m respectful… how much more time
do you have, respectfully? Because I’ve got about seven more questions.
DR. COVEY: Let’s just go at ‘em.
JAY: OK, you’re gracious. You talk a lot about universal, immutable principles in both
your books.
DR. COVEY: Right.
JAY: And I spend a lot of time looking at events, results, outcomes, good or bad, and I
always know that there’s a principle at work driving it. I’d like to know if you could give
me a list of your top two, three, five, ten -- whatever -- universal principles that we must
all learn to understand, respect, honor, harness, and use constantly, or not abuse, and just
some examples. Because I think they’re principles that apply… I don’t want to be
prescriptive, but they are principles that are immutable for all of us. What would they
be?
DR. COVEY: OK, I’ll give you an illustration. There’s four parts to our nature: our
body, mind, heart and spirit. So there’s a principle associated with each one. For the
body, the principle is fairness. For the heart, the principle is kindness and respect. For
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the mind, the principle is developing and using talent. For the spirit, the principle is
meaning and also integrity.
The other day I did a satellite to China. I know we’re going to do one on June 15th
around this country to 30 different markets. Well, they said to me, “Dr. Covey, how does
all this stuff pertain to Confucius country?” And I just said, “Do you believe in the
importance of fairness?” “Yeah, uh huh.” “What about treating people with kindness?”
“Oh yes, certainly.” “What about the development and use of their talent?”
“Absolutely.” “What about having need for work, where you add real value?” “Yeah.”
“What about integrity?” “Oh, that’s central to Confucius.”
I said, “Those are the principles. Same thing in the Koran. Same thing in the Bhagavad
Gita. These are timeless, universal principles.”
So what does it mean for a person setting up a job? “Pay me fairly, treat me kindly,
involve me creatively in doing meaningful work in principled ways.” Those are the
principles.
JAY: Those are great, those are great. I’ve got so many good ones. This is a very
interesting one. You talk in the new book -- I believe it’s the new book. If I’m wrong,
apologies. There’s a whole section on the speed of trust, and it’s a very powerful, and a
very, very subtle, but important recognition factor that we can all really harness and
capitalize on. Rather than spending a lot of time, can you give us the bottom line of the
impact, the relevance, and what it really means?
DR. COVEY: Well, you think about it. Trust is the glue of life, and if there is low trust
because of past duplicity, or a lack of being authentic and transparent, you’re going to
end up affecting the decisions, the relationships, and all of the taxes that you pay won’t
even begin to equal the cost of that low-trust culture.
You get a high-trust culture, where you live by principles and people know it, you can
make mistakes, and they’ll forget the mistake. It makes no difference. It’s faster than the
Internet.
In an Internet, you can’t make a mistake without the thing suffering. With a person, you
make a mistake -- “I know what you mean. Don’t worry about it, Stephen. I know you.
I know what you’re like. I know what your motive is.” This kind of trust has very
practical, hard-edged economic consequences.
I have a son, Stephen -- M.R. -- who is really drawing down on this subject, and is
coming up with amazing information -- hard-edge information -- on the speed and cost of
high or low trust.
JAY: It’s very powerful. I think you’ve gone a long way today to denominate the upside
leverage -- and the down -- in a lot of very intangible elements that we don’t really think
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about very carefully, and certainly don’t capitalize or really embrace, and that’s a great
one.
Another one -- in The 8th Habit you talked about path finding. I love that word. It
conjures up very exciting, moving thought, but it is abstract. Can you give me a tangible,
illustrative example that clearly defines not just what it means, but what it can and has
looked like for some others? Because I love path finding.
DR. COVEY: It basically means, what is your purpose, and what are your goals and
plans to achieve those goals? So based on your profession or your business, you’d say,
“My purpose, or my value proposition (like in this call today) would be to try to
communicate some basic elements of moving toward true greatness. OK?
And then what are some of the main goals? Well, the goal of covering the subject of
trust, like we just did very briefly… the goal of how you set up a complementary team…
the goal of how you empathically listen to somebody else…
So essentially, that’s what path finding means. In fact, in Germany, do you know that
path finding means leadership?
JAY: No, really?
DR. COVEY: Yeah. I didn’t realize that.
JAY: I think it’s a profoundly good mental reference frame for people to sort of
indelibly embed and deepen their mind and use as a reference.
DR. COVEY: Yeah.
JAY: I’ve got three more, and I think you’re going to like them. OK? They’re different.
The first one is, who/what has influenced you the most in your work, specifically, and
what was or were the biggest single insight, revelation, realization… that you got from it
or them, and what might be a lesson that we all can take from that?
DR. COVEY: I would say one of them was Abraham Maslow. He taught, “He that is
good with a hammer tends to think everything is a nail.” In other words, you have to ask
the question, “Is this an independent or an interdependent issue?” If it’s an independent
issue, think independently. If it’s interdependent, think interdependently.
In other words, you have to learn to be bilingual. You cannot just take one success
formula and apply it across the board. You have to first understand and diagnose what
the situation is, then come up with the best answer.
I think another powerful influencer was Peter Drucker. He’s the one that got me into this
whole difference between effectiveness and efficiency… between opportunism and
problem solving… between yesterday and today. He has a very powerful influence.
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Another one is that man that got me into teaching and training leaders, to where I decided
to become a teacher and eventually set up a business dealing with empowerment of
teachers. Now we have over 50,000 trained teachers inside organizations teaching what
I’m talking about today -- 50,000 all around this world, and it’s because we got them to
teach, and to be certified as teachers inside their own organizations. And they’re turned
on by teaching, and the best way to learn something is to teach it.
JAY: That’s wonderful. Next, and the second to the final question: What books, other
than your own, do you urge everyone -- And by the way, these books are so invaluable,
and so central, and so vital, I commend everyone to read them many times, if you
haven’t, including The 8th Habit, which is going to really springboard you to such a loftier
level of thought and action. But what other books would you urge everyone here to read,
why, and what’s the biggest single message they’ll get out of them?
DR. COVEY: I would say Man’s Search For Meaning, by Viktor Frankl.
JAY: Great book.
DR. COVEY: Profoundly influential book. Another one is A Guide For The Perplexed
by Schumacher. It teaches you about the four levels of being, and how the human being
has unique gifts and talents that can enable us to reinvent our life.
I’d say another one would be the Scriptures. I prayerfully ponder the Scriptures every
morning and every night. I can’t tell you the impact that has. Other people will study the
literature that inspires them, or they’ll get alone and meditate. Everyone does it
differently, but to me, it helps me to get centered on that which seems to be infinite, and
seems to have the source of eternal wisdom.
I also enjoy reading a lot of these new books. I enjoy your books, Jay, immensely. I
think you’re one of the great business and marketing minds I’ve ever known, and I’ve
enjoyed that time that we had together in Vegas.
JAY: You’re very gracious. Thank you.
DR. COVEY: So I’m a constant reader, and I’m sent all kinds of books for endorsement
purposes. And I can tell right off the bat whether they’ll work, as I mentioned earlier --
whether they’re written for the reader, or just to let the writer get convictions out.
JAY: That’s great. Thank you very much. The last, and probably in many ways, the
most significant: You’ve invested very graciously. You had a time schedule you
subordinated your own needs for the betterment of these people. We’re very
appreciative. But now that you’ve invested ninety-some minutes in us, and in hopefully
impacting, challenging and transforming our lives, what’s the biggest single implication,
realization, or recognition you want us to take away from the time you’ve invested in our
lives today that we can take home and act upon? And what’s the most important single
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step you’d like to see each and every one of us take immediately? And finally, why?
And that’s it.
DR. COVEY: I would say educate and obey your conscience. Your conscience gives
you a kind of peace different than peace of mind. Peace of mind means you’ve paid your
mortgage off. Peace of conscience means you’re true to your promises, to your vows.
You’re honest in all your business dealings. And I find that people that strive for peace of
conscience have an internal source of courage, and great strength.
I would also say this: As I mentioned earlier, the most important work we’ll ever do is in
the four walls of our own home. So don’t neglect your children and your grandchildren.
Have special personal relationships with every one of them so that you can leave a legacy
that is sustainable. Even Maslow himself on his deathbed renunciated his Need
Hierarchy Theory, and most people don’t know that because they haven’t read the
material that has come since his passing. He basically said that self transcendence is
much greater than self actualization… that you’re focused on higher purposes and higher
goals that benefit other people, not just the enhancement of yourself.
So to me, that is a very practical take home thing: Develop transcendent mission
statements, and have one for your family that focuses upon serving other families. We
would strike the death blow to 90% of the social problems in our society if every
functional family would adopt psychologically one dysfunctional one, or one kid that has
been abused and neglected. My wife has adopted so many of these, and I admire her
enormously for what she has done in blessing their lives.
JAY: Stephen, will you allow me to ask one more?
DR. COVEY: You bet.
JAY: OK. This is truly it. What one question did I not ask, should I have asked you,
wish I would have asked, and that needs to be asked and answered before you’re done
with us?
DR. COVEY: Oh, I’d say you’re pretty comprehensive, Jay! And I’m trying to think of
one question right now…
JAY: Is there anything that you --
DR. COVEY: If I would ask one question about what I would put at the center of your
life, my answer would be God.
JAY: OK.
DR. COVEY: So that’s my personal belief. But I want to say thanks to you, Jay, and
also to the listeners for your enduring this hour and a half, and hope someday that our
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paths will cross. And I wish all of you all of the best, for you, and for your families, and
for your organizations. I really have enjoyed this immensely.
JAY: You’re gracious. You’ve certainly made my day, and you’ve impacted me in
ways you’ll never know. Thank you very much. You’re a remarkable man.
DR. COVEY: Well, thank you Jay, very much. And thanks to everyone.
JAY: Goodbye.
DR. COVEY: Bye.
JAY: Thank you, everybody. We’re done. I hope that this has challenged your
thinking, stretched your sense of possibility, animated your spirit, given you some
renewed and expansive direction. We will be giving to everybody a summary review of
the questions, the answers. I am very impressed with the mind and the thinking of Dr.
Covey. He’s a very remarkable man, and I hope this will have a profound and a tangible
impact of the highest magnitude on each and every one of your business lives, your
personal lives, and will impact and transcend back to all the reaches.
Thank you all. It has been my great honor and pleasure to hopefully draw a bit more of
the greatness out of a very great man and translate it.
END
© 2005 The Abraham Group. All Rights Reserved.
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Maven LiveStream
Host: Rich Schefren and Jay Abraham
Date: September 27, 2012
Jay: We’re going to delve deeply into a hypothesis that Rich has, that I agree with and we’re
going to explore it, expand it, explain it, examine it, dissect it, reconstruct it, and then interpret
what it means to you.
I want to talk about more universal and some of these issues are more situational. So I’m going
to take the one, how to get clients willing to pay money? Why do people pay money? People
pay money because you are for them are of value. People pay money because you solve
problems that they either never knew they had or they knew they had but it wasn’t crystal clear.
People pay you money because you explain and convey to them that you understand their
situation, their problem, their need, their objective, their opportunity, their goal at a higher,
clearer way and you relate to them.
People spend money because they trust you. Now, I know that sounds very superficial
and very perfunctory but guess what? If Rich and I had every one of you watching in a room
and we one at a time really probed and penetrated and really, really put you on the hot seat,
most of you would not, the operative word is not; satisfy many or any of those categories.
So let me talk a little bit more about my belief and again, we’re different so I’m going to
come at it from a different point of view. How do you solve their problems in a better way? You
understand them at a better way. Yesterday, those of you who we’re on the preview call, we
talked about preeminence. We talked about empathy. We talked about thinking and
understanding in your heart, in your mind, in your soul what it’s like to be them. We talked
about expressing to them that’s why you get it. We talked about that you cannot express that
you get if you don’t get it and you can't get it sitting in an ivory tower trying to be superficial.
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It means all the buyers who are buying or looking, striving for the answer, the solution,
the opportunity; it means all the people you would be competing against directly in whatever
generic field you are. It means all the people you'll be competing against indirectly.
Let me try to give you a tangible and a concrete example. For example, let’s say you
were in the either weight loss or physical fitness space, okay? You could be selling a video,
could be selling a pill, could be selling a book, could be selling a course, you could be selling
any of a number of things.
First of all, you got to understand here and here what the market feels. How do you do
that? You do that by squinting your eyes and waiting for divine intervention? I'm not making fun
of anyone’s religious or spiritual belief, no. You don’t do that. You do it by understanding the
market at the seminal granular level. How do you do it?
The first thing is you study everyone else out there in the same field who is more
successful or as successful as you. You study what they say, you study their actions, their
approaches, their marketing, their methodology, their positioning, and their communications.
Then you look at everything out there about them, positive, negative.
Positive because you're trying to learn what exactly the people get satisfaction of.
Negative because that’s where the gap or the void is. Then you look at every other competitive
or compatible element. For example, if you were selling a book on fitness or a book on weight
loss, you want to also study Jenny Craig. You want to study 24 Hour Fitness, Spectrum, PX390
or whatever it’s called. You want to study all of them and see what they do good, what they do
bad. You want to learn language patterns. You want to understand emotionality. You want to
understand hot buttons then. We talked yesterday. If you were on the call you got it, if you
weren’t I will repeat it.
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You go to Amazon.com. Why? Because at Amazon.com, you can go to almost any
category or any subcategory of generic interest, weight loss, fitness, beautification, whatever it
is and you can find the top 20 or 30 or 50 books. You look at the title and the subtitle. Why?
Because books sell, sadly, more because of promise and benefit in the title or subtitle than they
do content. Then you look at the reviews and this is extraordinary because when people are
happy or when people are unhappy, they are passionate. They are passionately exhilarated
when they are gratified and they are pissed off; excuse my vulgarity when they are not.
So either way, their subconscious takes over their mind and articulates what they write
on a review. So if they're happy, you get verbiage which totally confirms personifies and
resonates with what the heart and the soul want or doesn’t want. If they're unhappy, they say it.
For example, I learned for the first time why what I was doing was keeping me from
losing weight or why all the exercises I was doing wouldn’t break muscles on me or why the diet
I was eating was not balanced enough to burn calories and build muscles.
Now, why is that important? Because you can use that language pattern exactly to
playback to the market. How? Let me give you an example. Just the elements I illustrated
hypothetically. If you're copy said, “Do you ever wonder if the nutrients you're eating are
actually fighting the outcome you're looking for or did you ever wonder why you're thinking
they’re healthy but not build muscle? We have the answer. You look at the negatives and the
negatives might be, “I thought this book was going to give me the answer because the promise
said it would and it didn’t.” “I thought this book was going to show me exercises that would get
me fit in 90 days. It actually got me fat in 90 days.”
And then you might use that language for the negative in your copy or in your
communication or in your e-mail or in your banner or in your landing page or in all of those. For
example, have you ever bought a book that was supposed to make you fit and it made you fat?
And you use all that language. But you can be able to understand your market. You can't have
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emphatic respect and connectivity with your market if you're not willing to dive deep into your
market and your market means the mindset of the heartfelt consumer, the buyer, and
perspective buyer. It means the mindset, the positioning, the approach, the marketing, and the
language of the direct competitor. It means all the other means and alternatives of getting to the
same angle because again, you're competing with everyone else in the field you're in.
Let’s say that you're in a video training business for fitness. You're competing against
everything else in the same field but you're competing against private trainers. You're
competing against the health clubs. You're competing against people riding bikes. You're
competing against people buying a book instead of a video. You're competing against people
doing nothing. The biggest competitor is inertia.
And if you don’t understand all the factors and forces you are dealing with that are
working against you and for you, how can you begin to do what this says, you can't read it?
How to get clients willing to pay dollars signs, money? So that’s the first thing.
The second is you got to be able to really care. There is nothing more important, there's
no bigger gap that I see. Rich may disagree, 98% of the people I see out there don’t care.
They don’t really care about their audience. They care about making money, they care about
writing good superficial copy. They care about selling a lot of stuff but they don’t really live in
their mind and heart to seeing people get thin or get fit or have a better life or feel better
themselves.
Their copy may superficially explain that but if you don’t feel it, you can't really
communicate it. You have no authenticity and so you're always going to be at very best
suboptimal. Meaning you're going to underperform your potential. At a very worst, you're going
to fail. The other thing you’ve got to do is be able to communicate powerfully in their language.
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Now, I think yesterday and Rich may affirm or not, we were supposed to send you some
information on my Strategy of Preeminence. I told everybody who watched yesterday that it is
the foundational basis upon which I build for myself and my clients all the culture, the belief
system, the marketing, the communication, the advertising, the articulation and if you didn’t go
through that line by line knowing that it’s a first draft that I did many years ago, so you got to be
a little bit able to translate and extrapolate it to your application.
But you should be able to go to 80%, 90% of those talking points. The list of key
elements and be able to write copy or write segments of copy from that. If you can't, you're not
grasping it because it’s a template, excuse me, of sorts, designed to help you forcibly get
connected, get compassionate, get empathic, get excited, and get passionate about your
marketplace
Okay. So I’m not an original thinker in this. I’m going to use Peter Drucker as a
reference. Peter Drucker said, there are two decisive kinds of small and medium businessmen
and women. The vast majority he does not call entrepreneurs, he calls them proprietors. And
his example and analogy is let’s say you had a deli. You got a clean location, an attractive sign,
clean crisply dressed people at the counter and at the tables and servers and support staff and
cooks and it smells good and people are reasonably cordial and your sandwiches are tasty and
your bread is soft and your prices are reasonable and people come and they eat and they don’t
get indigestion.
Or he said, that’s the majority of business examples. They're not really adding anything
but they're hopefully to take business away from another restaurant. They're not really trying to
add a dramatic level of improvement, enhancement, experience, disruptive benefit to the
dynamic. They're just sort of taking commerce. They're sucking oxygen out of the air of their
category.
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An entrepreneur on the other hand, is a man or woman who purposely creates their
enterprise to add more value, to be more engaging, to be more memorable, to inspire, to excite,
to stimulate either the senses or the experience of others and they purposely have a created it
to be decisively superior to the generic alternatives out there.
I’m telling you this because sadly, most people are proprietors, they're not entrepreneurs
and I think unless you understand the differential and commit to stop if you are proprietor and
forever again, commit yourself to the new, you’re becoming a born again entrepreneur, you
won't appreciate what we’re going to do. Fair enough?
Rich: Fair enough.
Jay: Okay. So why don’t you do a five-minute soliloquy on your hypothesis?
Rich: What I do generally are new mechanisms. I take the common goal of my marketplace
through the stuff that I showed you this morning and come up with a new core problem that
explains most of the problems and symptoms and a new mechanism which is the way to solve
the problem which is attacking the root cause.
Jay: You're trying to connect to understand the psyche of your market. You're trying to
understand where they’ve come from, what they're struggling with, what they’ve already done,
why they’ve done it, and where they're at as far as attitude right now.
Today’s whole session is going to ask questions to affirm, refute, flush out these two
premises but also to interpret, extrapolate and have interventional comments to help you, all of
you, online, online marketers see the implication, the oversights and the connectivities and
either question yourself, what you're doing or not doing in that application or how much more
you can do and just sort of expand your paradigm.
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It also I would argue, if you're an existing business, you can go from commoditization
and marginalized irrelevance to relevance, to distinction, to meaning, to trust, to value, to
interesting, to provocative, to polarizing. All of which have value depending on what you're
competing in, what you're product and your services are.
If you don’t do this deep reflective, connective thinking, you'll never really be able to
grasp why something works or doesn’t work, why you're business is at a certain level, why
you're stuck and this is all totally relevant.
I would argue that most people don’t know how exhilarating, how stimulating, how
liberating it is when you allow your mind to do what it was designed to do which is think deeply
and expansively and discover and understand. When you understand the meaning of business
life, when you understand how actions produce reactions and results, how inactions produce
things, I mean, to me that’s the most exhilarating and that’s how you're in control.
I think most people are out of control and they don’t even understand because they don’t
try to understand why something doesn’t produce the results they want. Why something does?
What the dynamic in their industry is? What the psychological, the motivational, the impactful or
non-impactful forces and factors are and I just think, power really is liberating and power comes
from understanding what's driving or not driving everything.
I’m going to challenge every one of our participants in an interesting way. And Rich,
again defaults to information marketer but the truth to the matter, the same tenants, the same
philosophies, the same principles drive everything in every arena because you're either a
commodity or you're not. You either take value or you're adding value. It’s not neutral.
Nothing in life, neutral I don’t even think exist to you really.
If I were doing my own seminar and this were ours, what I would do at this point before I
start plumbing and penetrating and proving your psyche and trying to explore this for the next
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hour or two, I would ask the audience to take two or three or five minutes and carefully reflect
upon what insight or insights they’ve made in the last hour that are either relevant, profound,
seismic, or significant and what they are going to do differently at least attitudinally so we can if
we’re making impact. And I would like to figure some way to get that kind of feedback.
I mean, the one thing that I think many well intended, when you say young experts but I
don’t mean young necessarily in terms of age but experience, they try to give you one tactic fits
all. It’s not true. You have to assess, I mean, the most wonderful thing about this process and
what I think Rich and I stand for is there are some universal truths but every market, every
situation really is unique and you have to – you can't fake it. You can't just throw a superficial
ad or a launch program or SEO program that’s generic. You can't fake caring and connecting
with your market. You're forced to do it but the more you understand it, the more you can relate
to it, don’t you think?
But I mean, the point we want to make here so you understand it is doling out lecture-
based information isn’t going to help you. Forcing, inspiring, cajoling, propelling, compelling you
to think deeper and make connections that move you to action is the only thing that’s going to
shift wherever you are in your life.
So going back to preeminence, it’s very important. He put into words to find, describe,
acknowledge, dimensionalize, made concrete feelings and frustrations that people in this case
opportunity seekers, people we’re trying to find a new opportunity, a new business, a new
source of revenue or economic security but never really got in their hands around, correct?
Okay. So what I want to do is from every vantage point you can explore right now, I
want everyone watching to gain an insight in the two different dimensions of the outside in
operating person.
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His thinking inside, what he is doing, what is verbal or assumptive or implicit beliefs are,
how his actions are executed and then flip it and say what the recipient, the market is seeing.
And I as the consumer and getting a bunch of the spirit, superficial if not hyperbolic,
irrelevant and not very connective and not very, humane is not the word. Let’s say
compassionate, passionate, empathic communications of whatever form, right?
And most people watching and it’s no shame because I don’t think anyone has really
connected all these parts for you in this way and it’s pretty profound. You're actually in a very
enviable place because you perhaps are getting illuminated of something 99% of the people
you're competing against don’t really grasp but if you can't really express congruently the value
and you hear the word value proposition. Even that is like gaming the system.
It’s not value proposition. It’s what's the heck do you stand for? What are you all about?
Why are you in business? Why in the world should you take oxygen out of that segment of the
market? What are you giving back? What contribution are you making? What value are you
creating beyond and in addition to all else that’s out there because if you can't answer that, how
in the world would you expect anyone to see and seize it?
Rich: Right. I totally agree. So there are two components.
The first is understanding that creating valuable content, okay? And no matter what type
of business you're in, whether you're in information business or non-information
business, you want to have valuable content that impacts your marketplace because that
will be a core driver online at the very least if not offline too.
Jay: And you could call that in a different form because I want to make sure for our non-
information marketers ideas, advice, experiences. It can be whatever you want but it’s
got to be the same thing.
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It still flows from a foundation or premise that we sort of lighted over here which is
everything he is, he is talking about leveraging his purpose really, isn’t it?
He is starting with I want to add value. I want to give people clarity on an issue or a
struggle or a challenge or a problem or a frustration.
So let’s explore that - I work with a company in Mexico. They may be watching me and
they know this. They have a huge organization, thousands and thousands and thousands of
people and they are very committed to an ideology and a culture that is about empathy and is
about listening and is about all kinds of really cool distinctions and I can interview any sales
person and any management person and they can all utter the phrases amazingly clear and I
guess it just switched. But when you ask them to explain what it means, you ask them to
situationally explain it in dimensional case study real world examples, they can't because they
understand it intellectually not transactionally. They don’t understand it in terms of real-world. I
want to make sure in my short stint in your lives, those of you who really don’t have a
relationship with me that I do that for you and for them. So take us deeper.
Remember yesterday, I talked about the three P’s, passion, purpose, and possibility.
Well, I didn’t explain possibility. Passion can be interpreted in two ways. You're passion for
what you do and who you do it for, two ways. Purpose can be two ways too. You're purpose in
adding value to the market or your purpose in putting economic value into your pocket. I’m not
making judgments. I'm just forking the road.
And I’ve got to make an interventional comment and I’ve done a lot of work on this. One
of the challenges that I think is very, very critical in this formative stage is value is totally
denominated by the market. So often, individuals in a business decide they're going to impose
their interpretation, their definition, what turns them on as value because they assume
associatively and usually not without any kind of market validation or invalidation that that turns
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Rich: What would you say in situations that I think both you have found yourself in, I have
found myself in, where you believe that what prospects or what the marketplace feels
they need, what they want is not really what they need and that you have a lot more
experience in that capacity, that vein and you believe they're wrong and so part of your
job is to get them to want what it is you feel they need.
Jay: I’m going to give you a complex answer and I've got something on this that I found if I
didn’t just lose it but I think that this gets enormously deep in the concept of trust building
because there's two different ways to do it. One, is brutally, mercifully, either/or
challenging their precepts.
The other is affirming their precepts long enough to get them to trust you to then move
them to a different way to get there and showing them you can't get here unless you go
here first and you can do both. But I had to get their trust first.
Okay, so let’s go back to the ranch so, in our last, when we left our hero tied to the
railroad tracks trying to untie the shackles of explaining this, we were getting you to
understand value. We were exploring that value was relative.
Rich: Should we make a list of all the ways of what value is? Would that be beneficial you
think?
Jay: Well, ask them. Would it be beneficial? Would you all like to have value defined,
analyzed, dissected, re-explored, explained, analogized, or do you understand it so well
it’s not relevant?
Rich: Okay, we’re going to look at their answers, but Dee Klege said in both psychiatry and
PR, the watch word is start where the client is at. You have to start working on what
they think the problem is, then towards what you think the problem is, like, if someone
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thinks they’re Jesus and they’re not, then you have to first enter into their world and say,
yes, Jesus, and then only then after you’ve built rapport can you actually get them.
Jay: Yeah, and it goes to this, and I’m going to have to modify it because I wrote this for a
different context, but when Steve Jobs died, I spent a lot of time reading all the eulogies,
all the commentaries, all the insights and also the negatives and I was trying to get a
context of what made him so different than everyone else because difference in value
and it was very decisive. I wrote something and I’m going to read it sort of, but I’m going
to edit it sort of. If it’s a waste, it was his fault, and if it has profound value, it was still his
idea. I called this, “Lessons You Can Learn from Steve Jobs.” Now I wrote this right
when he died.
“Steve Jobs, founder of Apple Computers, died last week, but his enormous
achievements and original belief systems live on, and I’m saying this because we’re in this
concept of value. In fact, those beliefs and behaviors are the driving success force behind a
huge group of people he originally influenced, and I thought it might be valuable for you and
now you get to, as I wrote it for a different group, if I shared a few of the impressions,
philosophies, and belief systems that I thought, that I perceived, Steve Jobs used to achieve
more success and accomplishment in his short life than almost anyone else in business history.”
Okay, I’m sharing him because I believe that you have the ability, the capacity, the
opportunity to build and springboard off of what Rich is going to share with you, and the desire
to accomplish so much more with whatever business, information, or offline that you’ve got, not
just more in financial terms, although I know that seems like your driving force. But a lot more
impact with the people you can reach, and if you grow your business that people can work with.
If you already have people and enrichment in your life, because I think that you’re searching for
enrichment, but you don’t know it.
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You may be transformed by a simple yet disarmingly summary of these powerful
thoughts, and they may make no impact, I don’t know. So hold on one second, because I’m
editing as I go.. “So if you have an opportunity this moment in time of choosing a path that’s
greater, happier, more prosperous, meaningful, satisfying, and purposeful, same time, same life,
same 24 hours, same effort, same money, same industry, why in the world would you possibly
take another path that’s unsatisfying, meaningless, and purposeless, it goes on, same thing.
Are you making irresistible, resistible, are you making beatable or unbeatable offers? So think
about the path you want to pursue as I read these things over to you, and these are lessons
from Steve Jobs’ rather amazing life.”
He was the best entrepreneur ever. Now, you can decide to be the best provider,
entrepreneur in your sector based on the definition I gave you and there are a lot of things that
have been written and I’ll give Rich some things you can link to. It’s all a decision that occurs
within. He always felt that whatever goal or objective he was pursuing, Steve Jobs, it was like
being part of leading a revolution. You can lead a new revolution in whatever area of business
you’re at, and as we said yesterday, you have permission; it doesn’t have to be at the top of the
international world. It can be in your community. It can be in your city. It can be in your town.
It can be in your little strip shopping center if that’s all you need, but you can lead a revolution
that changes the way everyone else thinks about and acts about what you do and who you do it
for. You could create a revolution where people started collaborating, cooperating, really
connecting at a deeper level, and I’m modifying this because it was written for a different
purpose, and you could focus squarely on the goal of adding so much meaning, thank you, and
transforming the lives of all the people you’re going to impact, and that’s what Rich has done.
Steve Jobs asked people, “do you want to spend the rest of life and career merely
selling stuff,” or this is what he asked people in his business, his employees, his team, or “would
you rather spend every second of every hour of every day of the rest of your life or career
transforming lives and families’ futures?”

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He was obsessed with what he called, and he is, too, creating the most insanely great
computers in the world. I would submit that most of you are not obsessed with creating the
most insanely great either product, services, distribution of those products or services, rendering
of them, and what would happen thought all of a sudden, right now in this moment, with you if
you became obsessed with doing that, the most insanely great fill in the blank.
Steve Jobs work and life had far reaching effects, both culture and industry, but with the
right mind set and behavioral shifts, your business, your life, whatever you’re doing here, could
have far reaching effects on all kinds of different people’s lives, don’t you think? I mean, you’ve
got, I mean, Rich has this list of people who are very successful information marketers. Now,
you can say, wow, Rich made them a lot of money, and that’s a superficial interpretation. You
could also say Rich helped them influence the lives of millions of other people who have
benefited, or you could say Rich helped the lives of all the families of all those people who
benefited, have greater futures, more opportunity, more security, you can go on and on. It
depends on how limited your scope.
Steve Jobs always said a lot times, people don’t know what they want until you show it
to them, and so I would really urge you to reread The Strategy of Preeminence because remind
you that we have to put into words for people the various hopes, dreams, goals, fears, desires,
and then show them why they want them and how vividly and remarkably gaining them or
relieving them of them can transform their lives.
Steve Jobs once said, “My goal is to go beyond what everyone else thought possible.”
Why can’t that be your goal within the realm of what you do? I’m editing this quickly and I’m
sorry. Steve Jobs felt that mediocre effort and work would be quickly forgotten, but truly great
work, truly great work will go down in history, and Rich has just demonstrated, he’s still selling
from that report 7, 8 years later because you put your heart and soul in it, not about making
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money but about making a difference in the lives of people who were struggling or frustrated or
pursuing the wrong path. Hope this makes sense, but I think this is interesting.
Value starts with acknowledgement and I really mean that. I think that that’s a critical
first step out the door of connectivity.
And I’ve got to make another point; I believe nuances are totally critical to everything.
We’re getting the value, but we’re trying to show people, we talked about acknowledging value.
There’s a universal phrase that I learned years ago, and it came from Rosser Reeves,
but reason why is probably the most, it’s like the wonder drug of strategy and marketing. You
know that? And I’ve never really said it that way, but it really is, but if you can show I
understand the reason why you want either to get close or away.
Rich: And I appreciate the situation that you’re in or the obstacles that you currently feel are in
your way.
Jay: And I know how frustrating it might be or how exciting the vision might be or either one.
Rich: So appreciation would also be understanding, right, so let’s just put that in.
Jay: Is by understanding this, and then harnessing that understanding and expressing it
authentically from within.
This is fun because I’m coming alive now mentally. I would argue with you that in the
beginning he had to do more of these things. Now he’s got enough critical mass,
velocity, and marketplace buy in, wouldn’t you think? But at one point he had to be
more, more explicit on all this.
I know, but it’s almost the concept, and this is not trying to be tactical, but the more, let’s
call it understanding, not a manipulation, but understanding can also be arrows in a quiver, and
we’re just trying to break and expand your understanding of the various dynamics that are going
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on. You don’t have to harness all of them. You can choose, depending on the application, the
situation, and separately the positioning or niche within that that you take to choose any of a
number of these or any combination. We’re just trying to give you a context maybe that’s more
expansive than you’ve ever thought about so we can build this whole thing for you.
You can’t be passive, because this is your life, your business, your future that we’re
dealing with, so help us add the best value we can to you.
And again, and I took us down this, is that I believe a lot of people in business on and
offline don’t understand that you’re in business for one reason, to add more value and
contribution than the alternatives, meaning the competition or other forms or inertia, don’t you?
And I’m just saying it’s a, it may seem like that’s a concept people don’t want to embrace but it’s
a concept that’s a very powerful positive or negative force depending on whether you harness it
or it basically knocks you over.
Rich: One of the quotes that I really have felt was very impactful that you said a long time ago,
was that “most entrepreneurs fall in love with the wrong thing.” They fall in love with
either their business or their product as opposed to their market and prospects, and one
thing that you can obviously see is that all of these are not about your product or your
business. All of these have to do with your prospect or your market. Whether it’s
acknowledgement of the pain or the desire, the confirmation of beliefs or feelings, these
are giving hope, lifting spirits, reducing guilt, these are all prospect and marketplace
oriented, which to me just kind of confirms the quote and confirms that we’re on the right
path.
Jay: Well, let me make a comment, because I said something yesterday that probably was
not well enough explained or at least connected by me, when I said with preeminence,
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when you get it, everything flows from it, but I also said something about you don’t have
to think about it. It’s a natural, I mean, when you’re, and I don’t want to sound
metaphysical or evangelical, but when you’re driven with the right purpose, you don’t
have to think through all this stuff, because everything sort of naturally flows and
connects, if that makes sense? I don’t know how you can explain a little clearer, but …
Well, I mean, you’re talking about complexity, and I’m saying complexity is, I mean, it’s
almost to me everything becomes one integrated like, it’s all part of the same thing, the way I
think about it, because it all sort of flows from the same belief system. You’re talking about
complexity and complexity is, I’ve got to do this, I’ve got to do that.
And there’s another point, and it’s probably, not relevancy, but wait, if you’re talking
about an ice cream being richer or it may not require as much dimensionality as if you’re talking
about something more profound as somebody’s life. I mean, so I don’t know, and I don’t know
that we need to get there right, what we have to get to is just people recognizing that most
people that they compete against don’t understand this either, and that’s a great advantage.
How about looking at it like that?
And I’m going to give you a totally complex alternative, because I’m thinking about
optimization for a minute, and the concept of optimization is elegant, really, at its highest.
We’ve talked about it; I’ve got this a little bit conflicting. Marshall Thurber, you know him, you
met him, he’s this very interesting man that some of you may or may not know, but he was
mentored by, he was a protégé of both Deming and Buckminster Fuller, which is interesting
because they stand for polar opposites. One is about innovation, and one is about optimization.
Optimization of making whatever it is better and better and better, and the other is getting rid of
a disruptively and replacing it with something totally different, and that’s very interesting.
One of the challenges a lot of people have, and it’s been my, not signature, but it’s been
my let’s say distinction is having a context of understanding of a lot of different ways to go at

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something, and being able to say well this is so much more cost effective or time effective or
you do it once and you’ll get a pay-off 7 times, and most people don’t have the benefit of
thinking that way.
One, you’ve got to help people be better critical thinkers, because they don’t think that
logically, so that’s one element you should put into your thing. Number two is you’ve got to
show them that a critical thinker is theoretical. Remember, and most people aren’t as old as I
am, but you remember Roxanne with Steve Martin. It was a movie that was a take on Cyrano
de Bergerac, and he had this great big nose. He was at a bar with a girlfriend, and these two
guys at the bar made stupid, arcane fun of him with stupid words like, something noggin or
something, and he said, that’s the best you can do? And he went through a soliloquy of like 40
really cool ways to himself, but I mean …
But I think it’s, and I think that entrepreneurs or proprietors, startups or not, need to be
given permission that they don’t have to tackle, they don’t have to eat the elephant the way, and
they don’t have to choke on it. I wrote down something else that’s very important.
But the end of it is to have small safe wins that reinforce you, and also can finance the
next levels.
I think about, okay, I’m taking people on a journey. Here’s where we’re going to head.
Here we’re getting into the car or the plane. What are the steps and what are the cities we’re
going to go over, and what are the process, and I’m thinking, okay, I’ve got to give them the
ability to realize that the way they’re thinking is the way they’re thinking, but it doesn’t have to be
the way they’re thinking, and there might be a lot better ways to thinking, and here’s some other
ones you might consider. I’m not going to give them all now, but I’m going to give you the
license that you do have the right to think differently about the subject. If you don’t have the
knowledge, here’s some ways you might get it, or you can go to somebody that has it.
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I’m just trying to give you how I would build that. Not that it’s a right way, but that’s how I would
get to that next step. I would give them examples, I would not confront them, but I would
liberate them and say it’s understandable. I mean, one of the things I believe we all think about
things from whatever experiences we’ve had. Even if you’ve read a lot of books or gone to a lot
of seminars, the truth of the matter is most of them are theoretical and interpreting. We’re going
out of our way right now to make a point and slow down and say, okay, let’s say what it means.
Let’s look at it from the inside out. Most people don’t do that. And it’s not necessary, maybe
they don’t care. Maybe they don’t, maybe they just don’t grasp this advocacy of making sure
that it has impact. Impact is everything, isn’t it?
Why would you want to spend it driving and worry about stress when you could spend it
thinking about things or writing or communicating? He just said it’s higher and better use of
your time. He didn’t care if it was a limo or he had someone drive you in the back of a
motorcycle, and I think you could start by just having enough foundational critical thinking to
say, okay, I’ve got all these things I could be doing. If I didn’t do this and put more time on this,
would it be better or worse? I mean, there’s probably some fundamental questions anybody
could ask themselves, and if you just went a little deeper the evidence, the answer would be
indicative. It’d be something that would be self-evident, don’t you think? I do.
Rich: Confirmation on value. The greatest way I can continue to gain insight to ensure I
understand client’s value from their perspective is to continue to do my customer
development interviews and empathy models with my audience. .
Takeaway: Best value creation exploits the weaknesses and how competition solves
clients’ problems. Not bad. Devil’s in the details, what problems they focus on, what
they do well and not so well. Don’t assume they’re perfect because they look
successful, so don’t just copy. What do customers say are the biggest problems in how
well they are satisfied? Find the gaps in satisfying needs. Focus there to seek an
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unconventional approach to those inadequately satisfied concerns. That’s a great point,
Bill, and the book Blue Ocean really talks about disruptive innovation as a way of kind of
dissecting other people’s ways, their value curve. That’s what they call it, and if you’re,
it’s a really, what’s really good about that book are the tools that they give you.
You know, intelligence is a very relative thing, and I think the more time you spend on
the things that actually are important, the more intelligent you seem.
Jay: Yeah, and I would say probably, I would agree, not on intelligence, but on connected.
We’re more connected to what we’re doing and who we’re doing it for.
I’ve got 3 statements. A concept approach as common as dirt in one industry can have
the impact of an atom bomb in another one. We talked about, it’s funny, FedEx
borrowed their concept from the Federal Reserve Bank. I can’t remember, I think roll on
deodorant borrowed their concept from the ball point pen. Fiber optics came from
aerospace. Monoxide was really supposed to fight pimples. Viagra was intended for
something else. So you have license. That’d be good. Let me think about it. I think
other than taking some people down a path they probably weren’t expecting, maybe you
as well, it was fun. I got intellectually stimulated today. I hope everybody else had a
good time.
Rich: So thanks for sticking with us. Thanks, Jay, and we’re done, so I’m going to walk out
with you, and have a great night. But one of the things that you can do right now to
really get the most value out of everything that we covered is pick one thing that you’re
going to do immediately. Whatever it is, and instead of just turning off the computer now
and pretending this day just didn’t exist, think through one action that you could take
immediately that would make the biggest difference based on what we covered, whether
it was this morning or this evening, and you might just want to review your notes and
turn some of them into action items.

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HOW TO BEST BENEFIT, PROFIT AND PROSPER FROM
THIS MENTORING EXPERIENCE
Mindset, Motivation and Gaining Maximum Momentum
Becoming a visionary
Leading others to make your visions happen
Becoming preeminent
Believing your vision
Becoming passionate about what you’re doing
Opportunistic vs. strategic opportunities
Advantage of Control vs. Ownership
The Strategy of Preeminence – Lending/commanding total respect and trust
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Using Your Existing Skills
Skill Set Inventory/Audit
Using your existing skills
Using your existing contacts/relationships/audit inventory
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Types Of Income Streams To Pursue
Acquiring rights
Acquiring licenses
Matchmaking
Recovery activities, opportunities, areas to focus on first
Difference between getting access or assets
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Getting Everyone Else To Do It All for You
Understanding and mastering the keys to the Tom Sawyer School of Business
Review all the rich examples, case studies, role playing and first hand scenarios to
evaluate
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Choosing Your Best Suited Income Opportunities to Pursue
Doing it with none of your own capital
Doing it with no time
Doing it with little time
Doing it with some time
Doing it as the “toll position”
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The Ins And Outs of Venture Marketing
The in’s and out’s of venture marketing [review venture marketing]
The keys to setting up barter profit centers or just doing barter deals [link to Barter
Baron]
The many ways to attract partners who’ll do all the heavy lifting and/or provide all the
financial requirements you need
32 options explained and explored. Pros and cons examined.
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How to get started this month without spending a dime
Bringing Other People In
Highly motivated on their own
Higher return/payoff than they’d normally expect
Take away the risk
Give them control/limited partner/profit center
Provide a vision far more exciting and enriching than they have for themselves
Demonstrate the certainty to give them to make that vision happen
Creativity-expanding your ability to see possibilities
Mastering arbitrage
Making the money connection – seeing implications, correlations, connections no one

else sees, then gaining functional control
Role playing – scenarios
How to become a passive venture capitalist using no money, whatsoever
How to buy businesses with no money, then flip them for huge lump sum profits
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Your Flight Path – Getting From Where YOU Are Now To Mounds of Passive Money Coming
In.
Customize Your Own Optimal Relational Capital Monetizing Model, Strategy and Action
Plan
Checklist of items to focus on
Anatomy of generating income streams for life
Licensing/Both ways
Rights
Processes
Brands
Endorsements
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Under-valued/Overlooked Alternative Forms of Passive Income
Stocks Surcharge Profit Shares
Dividends Shipping and Handling Options
Honoraries Earnings Gains
Commissions Transaction Fees Processes
Royalties Limited Partnerships Rent
Credits Phantom Stocks Leases
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How to Use This “Maximizer Power” To Multiply Your Success --- And Reduce the Downside
on Any Relational Capital Opportunity You Pursue
Using safe tests, eliminating the downside
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The Ten Pathways to Passive Income
1. New Income from What a Business Already Does
a. Referral Systems
b. Reactivating Old Buyers
c. Getting More Prospects to Buy
2. Adding New Profit Centers to Their Existing Model
a. Selling other Things to Existing Clients (i.e. home improvement, reusing prospects and
buyers).
3. New Ways to Use Their Assets, Resources and Activities
a. Authors and Consultants
b. Nightingale Conant
c. Telemarketing
d. Licensing
4. New Ways to Use or Take Their Business, Products, Services to Other Fields
a. Amusement tokens
b. Free-memberships
c. Licensing art designs
5. New Ways to Use Under-Performing Activities
a. Getting the rights to something and flip it (ground floor window advertising)
b. Art at a seminar
6. New Ways to Get Other Sources to Drive Sales to a Business
a. Finder
b. Concierge
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7. New Ways to Profit from a Business’s Problems
a. Liquidation broker
b. Barter/Trading
c. Flea Market
8. New Ways to Monetize a Business’s Access
a. Cruise ships/art
b. Apartments and Starter Home Builders
c. Experts, clients and endorsement/introductions
9. New Ways to Supply the Equivalent of Capital
a. Barter
b. Experts
c. Facilities
d. Services
10. The Three Keys
a. Show Businesses how to:
b. Maximize what they are already doing
c. Multiply the ways they can do business/profit
d. Repurpose what they’ve already done/monetize sunk cost/relationship
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How will you apply the 10 Pathways to Passive income?
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Mature Business Re-Invigoration
1) What does my competition do that’s different?
2) What does the competition do that’s better?
3) What advantages do they have over me? What would/do I need to exceed
theirs?
4) What products/services do people buy along with mine—before, during, and

after?
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5) How do my competitors normally sell and market?
6) What tangible/intangible issues most critically affect my prospect as it relates to my

product/service or category?
7) What alternative means (products/services) are out there to fill the same needs my
products/services provide?
8)
4B What are the best ways I now know are available to win business away
from my competition?
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9)
5B Who does my market respect, trust most? (Individual, companies, authors,
experts, and visionaries?)
10) Who could endorse us best and why? Who has maximum credibility (both
6B
companies and individuals)?
7B 11) What bonus addition packages would most appeal to my market and why?
12) What other prime products or services does my prospective buyer purchase
8B
most? (Need not be related to your category/industry).
13) How can I best transform the perception of my product, company, reputation?
9B
Who has the Relational Capital with the big market to help me do it?
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14) What additional value added service would appeal/mean the most to my
10B
prospective buyers and why?
15) What’s the repurchase cycle/lifetime value of my product in dollars and

11B
purchases? What are my allowable acquisition costs – by product/service/type

buyer/market/media?
16) How can I best dominate the new purchaser market using other people’s
12B
resources/Relational Capital?
17) How can I best win over, ethically, existing buyers away from my competitors –
13B
that I don’t do now?
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18) How can I increase consumption/repurchases amongst my current and former
14B
buyers?
15B 19) How can I best expand my exiting market?

16B List all possible ways, then value rank by viability/priority:
17B 20) What specialized niche can I fill using other organizations’ access/assets?
21) What repositioning, repackaging, repurposing or reengineering could best

18B
improve my product, service, sales people, image and appeal? Who has the resources
to make that happen for me?
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22) Calculate incremental value of all above elements you’ve written down.
19B
Meaning, how much/many more sales buyers, profits would I generate if I incorporated
all I have identified?
23) What’s the combined worth of acting on the above? Look at financial
20B
implications – multiply times 3-15 times for its asset value.
24) What action steps am I going to take based on all I have discussed and identified
21B
is now possible?
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REVIEW: The 12 Pillars Of Strategic Business Growth
1.) Continuously identifying and discovering hidden assets in your business.
2.) Mining cash windfalls each and every month out of your business.
3.) Engineering success into every action you take or decision you make.
4.) Building your business on a foundation of multiple profit sources instead of

depending on one single revenue source.
5.) Being different, special unique and advantageous in the eyes of your customers.
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6.) Creating real value for your customers and employees for maximum loyalty and
results.
Gaining the maximum personal leverage from every action, investment, time or energy
commitment you ever make.
8.) Networking/masterminding/brainstorming with like-minded, success-driven people

who share real life experiences with you.
9.) Turning you into an idea generator and recognized innovator within your industry or
market.
10.) Making “growth-thinking” a natural part of your everyday business philosophy.
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11.) Reversing the risk for both you and your customers in everything you do (so the
downside is almost zero, and the upside potential nearly infinite).
12.) Using small, safe tests to eliminate dangerous risks and adopting funnel vision
instead of tunnel vision in your thinking.
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Strategy vs. Tactics
The difference between Strategy (planning) and Tactics (doing).
Strategy is the science of planning and directing large scale operations. This is distinguished
from tactics which involve skillful methods and arrangements of the forces used to gain an end.
What will/should your strategy become?
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Leveraging Your Tactics
Challenge yourself to THINK deeply…exercise your creativity…adapt and adopt...as

you will discover that
Different objectives may involve the same tactics.

List all the leveraging breakthroughs you’ve uncovered:
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Tactical Deployment
How Many Different & Complimentary Ways Can I Use My Marketing Tactics?
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Several pages of choices follow, but let’s begin with “the Seven Musts.” There are dozens of
ways to use each of these marketing weapons. In this section, you’re planning “what” you can
do. In the next section, you will plan “how” you will do it, and in the following section, you will
actually plan WHEN you will do what.
Let’s begin with which of these weapons is appropriate for you and what are some of your
ideas/goals for utilizing this area. Remember, goals focus the mind. So let’s write some down.
Sales–Distribution Channels Plans Goals

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Promotional Media Goals

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P.R. Plans / Promotional Media Goals
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Trade Show Plans Goals

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Direct Mail Plans Goals

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Advertising Plans Goals

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Internet (web, email, affiliates) Plans Goals
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Promo Pieces & Brochures Plans Goals

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Others Goals
i.e., Infomercials
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My Relational Capital Strategy Defined:
StrategyTactics
STRATEGY TACTICS TACTICS
(Planning) (Doing)
(Planning) (Doing)
vs.
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My Current Strategy Is:
Where are the big improvements?
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MARKETING STRATEGY
My Current Strategy Is: (Best Effort)
Change Your Marketing Change Your Strategy and

Using Relational Capital and
You Change Your Result You Change Your Result

Marketing + Strategy + Relational Capital
DOMINATION OF YOUR NICHE/INDUSTY/MARKET
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Six Ways You Can Out Think, Out Perform
And Out Earn Your Competition
1.) Maximize what you already do. List all the ways you can do it:
2.) Multiply the opportunities available to you. How many new partnerships can YOU
establish? List:
3.) Monetize unprofitable areas of your business. Who would Relational Capital help?
Create new products / services. Who has access to the products/services technology/Research
&Development you need?
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4.) Profit from your competition. How many ways can you partner/profit?
5.) Reclaim past expenditures.
6.) Become strategic instead of tactical.
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Lessons You Can Learn From Steve Jobs
Steve Jobs, founder of Apple Computer, accomplished enormous achievements and original
belief systems that will live on. In fact, those beliefs and behaviors are the driving “success
force” behind a huge group of people Steve Jobs originally influenced.
I thought it might be valuable for you—IF I shared just a few of the impressive philosophies and
belief systems that Steve Jobs used to achieve more success and achievement in his short life
than almost anyone else in business history.
I am sharing these ideas with you ---because I believe YOU have the ability, the capacity, the
opportunity and the desire to accomplish so much more with your role. Not just a lot more in
financial terms---but a lot more impact of the people you work with…and a lot more
enrichment of the lives of all the clients whose futures we are ALL pledged to transform.
You may be transformed by the simple –yet disarmingly powerful thoughts you are about to
read. They may make no impact on you, either.
The way I look at it—it’s YOUR life to live the way you choose. BUT—if you have the
opportunity of choosing a path that’s greater, happier, more prosperous, meaningful, satisfying
and purposeful----why in the world would you possibly take another path that’s unsatisfying,
meaningless, purposeless?
So think about which path YOU want to pursue—as you read these brief observations that I
made about Steve Jobs amazing life---and how you can use HIS lessons to create your own
AMAZING life and career.
He was the best entrepreneur-ever. You could decide to be the best agent, or sales manager, or
operations manager or professional-ever, too! It’s all a decision that occurs within us—not
outside of us.
Steve Jobs always felt that whatever goal/objective he was pursuing—it was like being part of
leading a revolution. You could lead a new revolution within your area or your branch—a
revolution that changed the way everyone there thought and acted about transforming
people’s lives.
You could create a revolution where people started collaborating, cooperating together at
monumental levels of synergy. You could lead the revolution of refocusing everything we do
and all we accomplish—and focus it squarely on the goal of transforming the lives of more and
more families in our communities.
Steve Jobs asked people: Do you want to spend the rest of your life and career merely selling
stuff—OR would you rather spend every second...of every hour...of every day of the rest of
your life and career transforming lives and families’ futures? Ask that same question of yourself
right now:
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Steve Jobs was “obsessed” with what he called creating “..the most insanely great computer in
the world.” What would happen if—all of a sudden, you and your time became obsessed with
creating…The most insanely great company of transformation” in all of the world?
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Steve Jobs’ work and life had far-reaching effects in both culture and industry. But with the
right mindset and behavioral shifts—YOUR life could have far-reaching effects on both the
families of your team members and yourself---but more importantly on the families and
futures, and securities and prosperity of countless husbands and wives, mothers and fathers,
children and grandchildren---for decades to come.
Steve Jobs ALWAYS said… “A lot of times people don’t know what they want until you show it
to them.” Re-read the Strategy of Preeminence. It reminds you that we have to put into words
for people the various hopes, dreams, goals, fears they desire—then show them why they want
them and how vividly and remarkable their lives can change.
So—show people what they want and share why they should want it for themselves—be it
inspiring your team members, your prospective clients---or YOURSELF!
Steve Jobs once said ...My goal is to go beyond what everyone else thought possible. Why can’t
THAT be YOUR goal too—in your career, in your life, in all your interactions and collaborations?
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Steve Jobs felt that mediocre effort and work would be quickly forgotten. But truly great
work...truly great work will go down in history. Wouldn’t YOU rather have your work create
something remarkable, amazing, stunning—and enduring?
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Steve Jobs felt you had to do whatever it takes to delight clients. We don’t always delight—in
fact we don’t always even respect our clients. But IF you changed your thinking...if you thought
carefully/ considerately always about what it was like to be in that client’s shoes/place—wow
what a huge difference it could make to how you acted AND how well you connected with
every prospect/client we ever reached. The same is true of how you should probably think
about your fellow team members.
Steve Jobs refused to cut corners to make certain his client received the best possible outcome.
Are YOU cutting corners not following through, caring, and communicating appreciating the
client or team mates?
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Steve Jobs was passionate and patient about everything he did. He cared enthusiastically,
lovingly, joyously about the things he did and the people he did them with or for—plus he took
the time to always do things right. Do you?
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Another part of Steve Jobs’ passion came from his utter enjoyment of what he did—and he
found his work highly worthwhile. If you don’t truly learn to enjoy what you do and appreciate
ALL the different people you do it for---AND if you don’t clearly see the enormous purpose and
worth in what you do—you’ll never be great at your job. NEVER!
Steve Jobs told everyone who ever worked with him: YOU MUST WANT TO BE BUILDING
SOMETHING TOGETHER THAT LASTS! Are you building something through your efforts,
interactions, collaborations and contributions to others that lasts?
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People drew courage from Steve Jobs’ life, courage that fueled and propelled them to redefine
who they were, how they conducted their careers. Can you draw courage to redefine who you
are too?
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Steve Jobs felt that to waste precious time being ineffective is a sin. He made the absolute most
of a life he knew would be cut short young. If tomorrow your life ended, have YOU made the
absolute most are of what this career and opportunity should before yourself and family?
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Steve Jobs influenced went well beyond mere techies—is your influence through all you could
be accomplishing going well beyond just your job or department? If not—what do you need to
do differently to make that happen?
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Steve Jobs gave people the courage to pursue what they were most passionate about. Do you
have the courage to become more passionate about transforming people’s lives, about adding
more value about developing, supporting everyone else’s success and growth?
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Steve Jobs’ products touched us all. Are you making enough difference through what you’re
doing—and how well you do it to help touch more families—in more meaningful ways through
all we do?
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Steve Jobs redefined the way people communicated with one another. How can YOU redefine
the way people collaborate, co-operate and communicate more effectively/successfully?
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Steve Jobs wanted to change the world and make it a better place for everyone who lived in it.
Do you want to help change your client’s world, and make it a better place for them, their
children and future generations?
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Steve Jobs gave clients products most of them didn’t even know that they badly needed. Do
you want to help us give our clients better, happier, safer, more secure and prosperous futures
THEY don’t even know that they need?
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Steve Jobs took the time to think about things differently than anyone else had done. He had
more clarity. He inspired so many. He created a heightened ethos that challenged people to
higher standards for themselves. His energy and commitment was unstoppable. Are you this
way? If not consider the benefit of shifting over to that way of being, operating.
Bottom line?
No matter what your role…no matter what you do...you have today—right now—the ability
(not unlike Steve Jobs) to change people’s lives—and those changes can lead to massive
improvements of the quality of our entire world.
Do you have the energy, the courage, the passion, to never stop caring, contributing and
growing—growing yourself and growing everyone else you impact?
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Are you only interested—like Steve Jobs –in doing ONLY truly great at whatever you do?
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The soul of what we are creating today is to rally the spirits and passions of quality people like
you who want to do things better, differently, more meaningfully for ALL who matter.
How did reading these distinctions about Steve Jobs motivate you? How will it drive you to do things
differently for your business?
List all the ways you can and will apply Steve Jobs’ strategies:
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Jay Abraham’s
Three Ways
To
Grow a Business
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Three Ways
To
Grow a Business
© 2005 The Abraham Group, Inc. - All Rights Reserved
This document is provided under license and may not be modified,

re-sold, licensed, assigned, offered as a bonus or auctioned without
the prior written consent of The Abraham Group, Inc.
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Three Ways to Grow Your Business:
30 Marketing Strategies
Grow Your Client Base (18 of 30 strategies)
Increasing Your Lead or Inquiry Generation Through:
1. Referral systems.
2. Acquiring clients at break-even up front and make a profit on the back-end.
3. Guaranteeing purchases through risk reversal.
4. Host/beneficiary relationships.
5. Advertising.
6. Using direct mail.
7. Using telemarketing.
8. Running special events or information nights.
9. Acquiring qualified lists.
10. Develop a Unique Selling Proposition (USP).
11. Increasing the perceived value of your product/service through better client education.
12. Using public relations.
13. Increasing sales skill levels of your staff.
14. Qualifying leads up front.
15. Making irresistible offers.
16. Educating your clients by giving "reasons why.
17. Delivering higher-than-expected levels of service.
18. Communicating frequently with your clients to "nurture" them.
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Increase Average Transaction Value:
1. Improving your team's selling techniques to up-sell and cross-sell.
2. Using point-of-sale promotions.
3. Packaging complementary products and services together.
4. Increasing your pricing and hence your margins.
5. Changing the profile of your products or services to be more "up market."
6. Offering greater/larger units of purchase.
Increase Transaction Frequency
1. Developing a back-end of products that you can go back to your clients with.
2. Communicating personally with your clients (by telephone, letter, etc.) to maintain a
positive relationship.
3. Endorsing other people's products to your list.
4. Running special events such as "closed door sales," limited pre-releases, etc.
5. Pre-framing or programming clients.
6. Price inducements for frequency
List the ways you will implement these 3 ways to grow your business:
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Jay’s Notes: Strategy of Preeminence
Exercise:
How are you going to get started on the path towards greater achievements and contributions
of impact?
Below you’ll find some of the key talking points to focus on when you commit yourself and
your business to becoming preeminent. Go through the list and make notes of what you can
and will do differently, intellectually and interactively with your marketplace, team and stake
holder.
Preeminent Talking Points
Empathy
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I feel the way you feel. Understand what my problem is.
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Difference between giving information and giving advice. Telling people here’s what you should
be doing about it and here’s how – specific.
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Help provide people with focus – Focus is clarity. Clarity gives power. Power gives
understanding. Understanding gives certainty. Certainty gives trust. Without trust, people won’t
take action.
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Views that they trust
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Leadership
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People don’t trust the system
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Alternative
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Non-Mainstream
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People are mad – they don’t trust the system
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You’re not being told the whole truth. Here’s the truth as I see it.
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Most people don’t know what focus is until they’ve made it.
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Connectively and helps them take a step
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Ability to put into words what people want – and build on them.
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Making YOU the center of attention.
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Bring in people sequentially and bringing them along.
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Hopefulness – my wish for you
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I have a moral obligation to NOT let you avoid taking action that will improve your life, wealth,
health and happiness.
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Client vs. customer – they are under your care, direction, well being, guidance.
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Who are we communicating to? What problems, opportunities are we going to help them deal
with?
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How would we have the most positive impact, immediately, today? We’re in their home with
them as friends having a conversation with them dedicated to giving them advice, dedication
and motivation to provide them the greatest benefit (focus isn’t you, it’s them).
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The message doesn’t have any value unless it makes an impact and gets them to take action.
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Prospects have to recognize your advice as a solution to a huge problem they feel emotionally as
well as rationally.
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You have to provide them with the reassurance and the motivation to use that solution, now!
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It can be either a result or a good or better feeling about what they are already doing, or,
preferably, both.
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I want to feel good about myself and the way I have conducted myself.
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I want to feel good about my decision and actions.
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But they’ll do things to curtail making gains because they don’t want to feel foolish.
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Look at purpose.
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Ask yourself this question:

If I were on the receiving end of my sales communication/presentation, why would I want this?
Why would I want to take advantage? What’s in it for them/me?
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My proposition/presentation has to answer a question that’s already on the client’s mind. But
may never have been verbalized by them.
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______________________________________________________________________________
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Most people fall in love with product instead of prospect.
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When you conceive of your business as interacting and enhancing people’s lives, everything
changes, results improve.
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Most people think, “What do I have to say to get people to buy?” They should say, “What do I
have to give? What benefit do I have to render?”
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Worst thing to do is feel out of control, confused, structured.
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Agent of change/creator of value/value contributors.
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People don’t want to be average.
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People need solutions not strategy. They need someone to advocate and address their well
being.
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People always pursue their well being in a logical rational way. Isn’t there a better way?
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You want to have ideas that make sense and leave people better off than they started.
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Most people focus on tangible results. Most of the great rewards aren’t tangible.
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“Show me” is so much more powerful than “tell me.”
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Instead of making conclusive statements, give me ammunition that allows me to come to a

conclusion.
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You never want to draw the conclusion – you want them to take an action that makes a
commitment.
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If they don’t take the action themselves, there’s no power into it:
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Show me – don’t tell me.
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People worry about whether they stand out, whether they’re unique, whether people will care.
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The concept is too difficult for most people to buy into – instead give them an example of how
things work.
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Let me show you what we do and how our system works so you can sign on.
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Help me with the next business/influential decision.
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People are searching for ways to make the next decision better – solve their problem today.
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Here someone comes aboard for the hope. In general, they come aboard because they’d like to
be better off than they are and they’d like to be specific.
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It has been subject matter focused. Must be individual focused. I help the individual through my
mastery of the subject matter by helping school them on the purpose so they can think better.
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We can make people feel comfortable with a lot of things they used to be intimidated by.
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Difference is it focuses on individual.
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Most people spend their entire lives getting only a fraction of the yield they can out of their
endeavors.
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Multiplier vs. Diminisher
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______________________________________________________________________
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What are the best ways I can use The Strategy of Preeminence to stay ahead of my
competitors?
What will I do differently, and how will I execute The Strategy of Preeminence with this new
thinking?
ADVANCED STRATEGY OF PREEMINENCE

I have a perpetual obsession, as opposed to a magnificent obsession, with learning how
other people see life, what their values are, what their mindsets are, what their principles of
operation are. Tony Robbins calls them “organizing principles.” And I invest massively to do
that.
There’s a gentleman who is the managing director, the president, of one of the most
successful entities of its kind in the United States. They are approximately 400% larger than
their closest competitor. They have grown 15 times in the last five years. They are ten times
more profitable, and they command an absolute, unequivocal predominance in every area that
they penetrate. They have more fun, and they’re more formidable and more invincible than
anybody I’ve ever met.
I did an exchange with him. I gave him about $200,000 of my consulting services one
time in exchange for picking his mind clean. It was a good trade, because he didn’t want to pay
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me money and I wanted something far more valuable. I wanted to understand what he
understood that I didn’t so that I could add it to my knowledge base and my focal perspective
and my mind set. I wanted to travel to where he was living because he was seeing things in a
perspective I had not.
I asked him a lot of questions, and what ensued was about 400 pages of transcribed
notes. I’ve summarized what I think is his base formula for success, and I submit to you that it
has elements that should be integrated into your base formula, too.
I am a relatively competent interviewer, AKA interrogator. I know how to isolate and

rifle in on the key elements. So I asked him a lot of questions, but they were all geared towards
me getting a clarified answer to how his philosophy, his strategy, his belief systems, his focus on
customers, on marketing, and on business in general work. I wanted answers that had
universal translatability to anybody.
The first element he shared with me, which was a foundational pillar in their success,
was that they strove to have enormous empathy with their customer. They saw their purpose
as selling leadership, as opposed to just being a wet noodle and letting people sort of do
whatever they wanted. They saw their purpose and their role as being a leader, an
authoritative, consultative force in their marketplaces. They saw it as essential that they
telegraphed and communicated and conveyed to their customers and prospects the essence of
the fact that they felt they way did. In other words, “I feel the way you feel. I understand what
you’re problem is.”
They saw a distinct difference between giving information and giving advice. They saw
their role as telling people, “Here’s what you should do about a problem, or a situation, or an
opportunity,” and specifically supported it with a compelling, irrefutable set of definitive facts.
They saw their role as helping people focus on issues they’d never fully verbalized.
There are so many of us struggling to get the picture of what it looks like -- the picture
of what we feel. We don’t even know definitively what we want because we’re struggling. We
don’t even have phrases or clarity on what we feel. We don’t even know definitively what we
want because we’re struggling. People that help us understand, and acknowledge, and
articulate, and take action, and formulate a definitive, logical, compelling strategy normally get
our trust.
Ask yourself this: In your business, in your life, in your critical necessity-based buying, in
your indulgence-based buying, in your vanity buying…don’t you really gravitate towards people
who lead you? Towards people who are empathetically authoritative? Big, big difference.
They felt like their critical purpose was to present views their customers could trust.
Again, leadership, leadership, leadership. They saw their role, their function, their purpose,
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their advantage, their positioning as being a leadership authority, although a benevolent, an
impassive, a nurturing, and a loving one.
People inherently don’t trust the system. “The system” means different things in
different applications. It could mean the big competitor. It could mean the way the
government mandates. It could mean the way life has become. It could mean the fact that
everyone is relegating everyone into being a commodity. And that doesn’t limit itself just to
business. Human beings are felt to be commodities too.
Everyone feels like they’re a commodity. They’re not distinctive. They have no purpose.
They have no connectivity. This is a real big issue of opportunity.
They see themselves as representing a refreshing alternative to the mundanity and the
unfulfilling norm. They are the refreshing, distinctive alternative. They don’t take the premise
of wanting to be mainstream because they think that mainstream is commodity. Mainstream is
undistinctive. Mainstream has little value.
They believe that most people are inherently upset or mad because they don’t trust the
system and they need someone to confirm that their rules are right. However, there’s positive,
hopeful opportunity in this dilemma, and they see their role as representing that.
They take the role of basically conveying to people that they’re not being told the entire
truth or all that there is to know about a subject. Then they take their role and say, “Here’s the
truth as we, or as I, see it.” Some of the programs are generic. Some of them have a
personality behind them. You’re not being told the truth. Here’s the truth as I see it.
They believe that most people don’t know what focus is until they’ve had it made for
them. I think so many people in this world never understand the meaning of business life. You
take the same feelings, relatively speaking, that you’re embraced with and ask yourself, how
can you direct the same experience to your customers, or your employees, or your vendors?
They felt like a key element of their function was connectivity and to help people take
the next steps. It did no good to give them a data dump of information if they didn’t know
what to do with it, and why to do something.
Their role was to connect all the dots, give them a plan, help them take the next step,
protect them, make that step logical, appropriate, obvious and easy. They saw, importantly,
their role of their ability to put into words what people wanted but could not articulate or put
clarity on, and then build on that for them.
I submit to all of you that you’re missing an enormous opportunity if you don’t take the
role of verbalizing, and articulating, and feeling. You are human beings, and human beings feel
the same way in any environment. That the same dynamic I have just exposed you to, you can
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expose your customers to over and over again, and you can expose your staff, or your team
members, or your vendors or your loved ones, and it’s very powerful. Does that make sense?
They always saw themselves selling a point of view, never saying, “Do what you want.
Everything’s OK. What would you like?” They didn’t think that was their role, and their
purpose was not to let people just be rudderless.
How many of you have a very, very committed relationship to somebody in a business,
whether it’s for your business, or for your personal, or for your vanity, or for your hobby -- that
is so benevolently authoritative and leads you on a very viewpoint-type of a journey? That’s
the key advantage you can give. Those of you who don’t, it’s probably because no one has ever
embraced you in a way that you felt they were looking out for your best interest.
Many people are very self-serving in their efforts to be selfless, and it clearly comes
through. Don’t you think? That’s understandable. Those of you who have never embraced
that, that’s because the people have never been able to articulate, or demonstrate, or live it. If
you can live it by a belief system that’s genuinely outwardly focused…that genuinely sees your
higher cause of purpose as being to enrich other people’s lives…to bring greater benefits,
greater protection, greater advantage, greater financial benefit, greater savings, greater safety,
greater productivity -- greater whatever. It’s real easy to do. It’s really difficult to do if you do
not believe and live what I’m talking about. But if you do not believe and live what I’m talking
about, business is pretty unfulfilling anyhow.
So, it’s like the secret to making business really soar is to have a passionate awareness
and commitment to a higher purpose, and the higher purpose is not your own enrichment. It’s
different kinds of financial, or psychic, or transactional enrichment of other people -- helping
their lives be better, helping them be more fulfilled, helping them get more out of the process,
or out of life itself.
They saw their purpose of making you -- meaning their customer or client -- the center
of attention. They saw their purpose to bring people in sequentially as they found them on the
continuum of life, and then keep bringing them along and advancing them. Not just sort of
coming in and out, but starting somewhere and progressing them. And not starting everyone at
the same point, because different people are at different points, as you all are at different point
of progression.
You are a human being. Human nature is immutable. It has been immutable from the
first time man found himself on this earth. Human nature will be the absolute same until
Armageddon or a nuclear holocaust. You are human, and the way you react to me, or you react
to each other, or you react to anything, is no different than any other human being you are
trying to deal with reacts. If you sell to corporations, corporations have individuals, human
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beings making decisions. Corporations are composites of human beings with hopes, desires,
fears, and emotions, just like you.
They felt hopefully about their customers. They embraced their customers’ situation
with hope and promise, just like my hope and wish for you is that you will get so much more
out of everything you do. That you will allow yourselves to get so much more productivity,
profitability, connectivity, and residual value out of every action, every hour, every dialogue,
every contact, every customer.
That same philosophical basis is what these people live and the way they communicate
with their clients and the way they look at their clients. They have hope.
When I look at an audience, I don’t see men and women 40, 50, 60, I don’t see people
who have been burned and have become bitter. I see a bunch of little innocent children at the
beginning process of their lives, without any bad habits, with a lot of trust, with innocence and
a sense of curiosity and discovery.
If you can look at your customers that way, it gives you an incredible context of
nurturous appreciation for them. You have a lot more fun with them. You have a lot more
understanding of them. You have a lot more respect for them. You have a lot more envious
admiration for where they are, and how much they can do, and how far they’ve come. It’s just
a fun way of looking at life.
They ask themselves continuously, “How can we do what we’re doing for others
better?” They never are content. It’s a very simple process. That’s the secret of what Deming
basically taught the Japanese. That’s the secret of optimization. It’s constant, never-ending
improvement.
It’s a simple philosophy to utter intellectually, but that’s an exhilarating philosophy to

live because it gives you confidence and mental gains. Confidence and mental gains in all
aspects of your being, but particularly in your connectivity and your bond with the customer.
What problems are we going to help our customers solve? How can we have the most positive
impact on the people we’re trying to sell to? To look at them figuratively in their home and
with them as friends, having a conversation with them, dedicated to giving them information,
dedicated to motivating and providing them with the greatest benefit until we come into their
home again.
They believe the message doesn’t have any value unless it makes an impact. I would
submit to you that the reason I do these programs this way is that I used to do them in a
lecture-based environment. I used to just deliver all kinds of profound and provocative
principles and techniques, and I would blow people’s minds for three days -- and they would go
back and do nothing because it didn’t have an enduring impact.
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People have to recognize your advice as a solution to a problem they feel emotionally as
well as rationally. Those of you who can’t understand how somebody can’t see the “logic” of
some proposition you’ve been trying to sell them on, probably are grossly missing the boat and
not approaching it from the emotional context.
You have to provide them with the reassurance and the motivation to use that solution.
What we can be providing people can be either a result or a good or a better feeling
about what your client is already doing. Sometimes you miss the boat. Maybe you don’t have
a distinctive advantage on price or performance. Maybe you have a massive advantage on the
way you can get into their awareness, you can acknowledge them, you can empathize with
them, you can advise them. That is a unique selling advantage. That is a distinguishing benefit
that sets you apart.
People, clients, customers, who are individuals, want very badly to feel good about
themselves and the way they conducted their decision. More people take less action because
they are afraid it won’t be right, they are going to look dumb, or they are going to screw it up.
You’ve got to understand, your job is to acknowledge that reality of human nature and
compensate around it. Reassure them, direct them.
People will do more things to curtail making gains, because they don’t want to look
foolish. They will work harder not to look foolish than they will work to gain an advantage. It’s
human nature. Don’t argue with it. Accept it and factor into your strategies and your actions
this reality.
Most people either understand on a higher level, but a lot of sales efforts don’t give
them credit for their knowledge, or they are too assumptive. We’ve gotten to the point in a lot
of issues that are so assumptive that we don’t describe them. We assume and presume and
nobody understands the implications. You do them a disservice, you disacknowledge their
intelligence, and you disrespect them when you assume anything. You lose advantage.
People want to feel good about them and about the role they conduct their decisions.
It’s very important for us to fell good about ourselves.
I encourage you to reflect on the sense that you have done a lot more for your
customers, that your business stands for a lot more. That your life’s investment, the body of
your work, has meant a lot more. It has enriched, protected, enhanced a lot of people’s lives.
And what you do for others, and for the lives of your staff, and the creation of value, and
livelihood, and contribution you have made, is and will be quite profound. It makes you feel a
lot better about what you do.
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These people look fully at what their purpose is. I submit to you that until and unless
you understand higher purpose for your being in this business, you can’t begin to take
advantage of your potential. Your purpose cannot be to get rich, or you will never get rich. The
purpose has got to be seeing what you can do and what you’ve done for others.
People who are important, valued friends deserve to have the best-reasoned, the best-
informed, the most objective and knowledgeable advice they possibly can get about key
emotional decisions they could make a mistake about if they got into somebody’s unscrupulous
clutches and be misguided and make a critical imprudent decision that could screw up their life
and their finances. Don’t you then owe it to your past customers, who are your valued friends,
to contact them and make it known to them that you care deeply enough about them that if
anybody in their lives are at these crossroads, you encourage them to refer them to you, if
nothing more than just to get your well reasoned opinion, your best judgment on something?
It matters not whether they avail themselves of you. It just matters to you that they at least get
the best take they can on a situation before they make an ill, um, ill decided, um, decision?
Does that make sense to you?
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If you fail to value, acknowledge and respect the worth of what you have done, what
you do, and how much more you will be doing for your clients… If you don’t respect and revere
that, it’s shameful. If you do respect and revere that, you have a causal purpose to do it even
more. And also help your client appreciate it so they can understand the significance of what it
means to their lives.
Look at your purpose. Ask yourself this question. If I were on the receiving end, why
would I want this? Why would I want to take advantage? What’s in it for me?
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Ask yourself this question. So what? When you’re making a presentation or you’re
figuring out what your ad should be like, ask yourself this question. Demonstrate to people
that logic and emotion by acting is so much more preferable to them than inaction, from their
benefit standpoint, not yours.
Your promotion or your sales approach has to answer the question that’s already on the
customer’s mind. People need to be told what you’re going to do for them and why. They
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don’t care how you’re going to do it, they want to know what’s in it for them. Tell me why and
how your process would better my life, my circumstances, my situation, my security, my
enrichment. And how well you do that is your credibility.
Most people fall in love with their product or their company instead of falling in love
with their client. If you have a higher cause or purpose, it has nothing to do with your getting
rich. It has nothing to do with you being technologically the most sophisticated producer. It
has everything to do with your bringing enhanced advantage, protection, benefit, richness of
life or business, to a client.
If you can’t, fall in love with your client, you’re in the wrong business, or you don’t
appreciate your business, or you don’t appreciate your worth. If you appreciate it, but your
team doesn’t, you’ve got to fall in love with your team and help them, lovingly but
unflinchingly, and almost relentlessly see how to fall in love with the clients with you. It’s got to
be a combined love affair.
I’m not being metaphysical. I’m being so bottom-line serious, it’s unbelievable. I’m
giving you the secret to richness in life at a level your pocketbooks and your heart will never
imagine.
A massive change will occur in your whole mindset when you can see your business as
interacting and enhancing people and their lives. It’ll change totally the way you see things.
Most people think, “What do I have to say to get people to buy?” Instead you should
say, “What do I have to give? What benefit do I have to render?” It’s nothing to do with sales
shenanigans or trickery or schemes. My purpose for all of you is to teach you how to become
value creators or value generators. The more value you render others, the more value you
generate, not for yourself, but for your clients, the more contribution you make to the richness
of their lives, the more successful you will become, the more bonded you will be to them and
they to you.
The focus of your concern should state to the customer, “You matter. Your well being is
important to me.” The worst thing anybody can be allowed to be is to feel out of control, or
confused, or unstructured in their thinking. You have the opportunity and the right to show
your clients and your team how they can have control, and liberate them, give them their
freedom. Because the more you give people the control the more they appreciate the
liberator.
See yourself as becoming an agent of change, a creator of value, a value contributor.

Most people don’t want to see things as a process. They’d rather see things as a project with a
beginning and an end. It’s easier for them to comprehend it. Brake things down for people into
simple steps. Little changes and shifts you give them make big differences.
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Decide you don’t want to be average. People don’t want to be average. You know in
the craw of your heart and soul there’s more purpose, more feeling, and morefulfillments to
life. As soon as they don’t feel average, you’ve got them hooked for life.
People need solutions, not strategy. In business, politics, arts, and war achievement,
great achievement is made oftentimes by people who have less attributes than the people they
were vying against - David and Goliath, if you will. But they had a better strategy. If you ask
me, in life, what are the most important, selling skills or strategy, I will always take strategy.
It translates in a lesson in copywriting. If anybody says, “I need to know the elements of

writing a good ad,” I say, “Screw that.” You know the elements of conceptualizing a good
proposition, a good offer that’s externally focused and predicated on the value and the benefit
it has to others. If the concept is right, the copy can be terrible and it will still sell. If the
concept is wrong, the greatest copy in the world won’t work.
If the strategy is right, you can mess it up, it will still work. If the strategy is wrong, the
most eloquent and well-conceived program won’t work. I strongly urge you to be more
strategy and concept oriented than technique oriented in your lives or in your businesses.
People will always pursue their well-being in a logical, rational way, but they will make
their decisions on an emotional bent. You should always ask them and ask yourself, “Isn’t there
a better way they could be doing something?”
One of the pivotal, the integral, the critical, the central essences of what distinguished
them and made them so much more successful was that they understood that “show me” is so
much more powerful than “tell me.” By showing it to you as it was alive, as it took form, as it
rooted and worked in different people’s lives, it’s much more dramatic, isn’t it? It’s much more
real. It’s much more embraceable, and much more practical for you and much more
achievable.
Instead of making a conclusive statement, they felt they were much better off giving
their client the ammunition that allowed them to make the conclusion for themselves. If I do
my job correctly for anyone, they end up evolving to the decision thinking that some conclusion
is their own. That is my intended outcome because it’s much more powerful if you own it
rather than me.
If I own it and lend it to you, it’s never going to be yours. If you basically gestated it,
consummated it, gestated it, given birth to it, and raised it - it’s your own, it’s your progeny, you
have great pride and commitment to it and belief in it. It is a mere extension of you. It’s part of
you.
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You never want to draw the conclusions. You want them to take an action that makes a
commitment. Your commitment to them will never be as strong as their commitment to
themselves.
If they don’t take action themselves, there’s no power in it. Empowerment is a

meaningless word unless you understand its implication. You empower them by turning on the
energy and the power of their awareness by making it real and making them take ownership of
it. “Show me, don’t tell me” is their whole model. They believe that the client is silently
uttering or thinking, “Show me, don’t tell me.”
Any claim you make your client must agree with or you lost them. Think about it. It’s
not an intellectual battle for factual superiority, is it? What do you win when you lose? You
may be so ardent, but you’re losing by trying to shove the fact down their throat. Any claim
you make, I must agree with or I’m going to discount or shut off. So it doesn’t matter if you’re
right if I refuse to acknowledge that you’re right.
People can’t agree with most claims unless they can think them through.
I had a client one time who was a brilliant thinker, but he didn’t understand any of the
elements I just shared with you. He had this hilarious constant battle and argument. He was
involved in the investment field at a very high level and very successful. He was very well read
and very esoteric in his understanding of the interventions of all kinds of economic, financial,
social, political economic issues and their implication to investment, finance, monetary trends,
commodity prices. He was a very bright man. However…
He was too hip. He thought people loved him and respected him so much that all he
had to do was utter his conclusions and they would just follow. He would sit down and he
would write to his clients and just say, “Do this, do that.” I’d say, “That’s wrong, that’s wrong.”
He’d say, “No, no, this is what they need. They don’t want to be burdened with all the details.
They just want the facts.” So he’d do it and he’d get a modest or non-response. And I’d say,
“Do you want me to try?”
And then I’d go through the process of letting them in on the conclusion, the basis, the
facts, what we thought that meant, why we thought that meant it. Because from logical
emotional standards this interpretation made better sense. And then, finally, after I’d walk
them through the whole process I took them to a conclusion.
Invariably, 99.9 times out of 100, my report out-produced his by quantum levels. But he
still kept doing it because he wanted to fight them, he wanted to show them. It is the price you
pay on indulging yourself. It’s lessened results, lessened connection, lessened profitability,
lessened success. If you’re willing to pay that price, more power to you, as long as you identify
and understand the cost that certain avenues of action impose upon you.
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People discount series of statements. They want to evolve a series of conclusions. Just
saying, “This is the way it is” does not help people. Again, I hope that I’ve gone to such
inordinate and almost protracted and caricaturized effort to make that point evident to you by
my own actions. If I just gave you definitive comments but didn’t give you the richness of the
parenthetical implications and the basis behind it, you think you’d understand and embrace it
at the level that you do at this moment?
These people that I interviewed felt that their job was always to advocate their client’s
perspective. So that every word said the client silently felt, “He understands me and where I’m
at or where I’m coming from.”
People feel, “I’m tired of being controlled.” Don’t you? Aren’t you tired of being
limited? Aren’t you tired of having ads that don’t work? Aren’t you tired of having competition
basically make you have to lower yourself to their level? Aren’t you tired of customers
relegating you to a commodity?
I would be if I were you. That’s why I wouldn’t do it. That’s why you don’t have to do it,
because you’re in control. You aren’t controlled - never have been. You just abdicated control
of yourselves and your business.
These people understood at the highest level possible that their job is to reduce the
hurdle, their equivalent of lowering the barrier of resistance.
People are quietly obsessed, sometimes even unconsciously obsessed with whether or
not they stand out, whether or not they’re unique, whether people will care about them. Do
you think you’re any different? Don’t you want people to care deeply about you? I would like
to hope, because it is the truth, I really care about your well being. I’m not looking at you for
your wallet.
Your clients want to feel like you worry about them and you care about them in a
dimension far more meaningful than just catering to their treasury, or their pocketbook, or
their bank card. And you should, because it makes doing business and transacting your life
about ten times more fulfilling and effective.
They felt that most of their competitors didn’t give their own customers a chance to buy
more. They felt like they limited their clients’ ability to understand the advantages and to help
connect with the client to the client to take fullest advantage of all the opportunities that were
there for them to make their lives and their businesses more fulfilling, purposeful, rich, more
productive. They felt that customers really were being forced to buy less than they wanted to
by the options of most of their competitors.
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Many concepts can be too difficult for most people to buy into. I am a little - or a lot -
guilty of this. The more you can use a reference example everyone can relate to first and then
explain it, the easier it is for people.
I’ll talk about a concept and then explain it or apply it. I gave you a reference in your life
of something that was evident…if I said to you, “You know when you go to McDonalds and you
ask for a hamburger, they always say, ‘Would you also like fries and a Coke?’ Well that’s up-
selling.” Then you’ve got a reference frame.
You should always try to use a reference frame metaphorically first before you try to
explain anything to your clients.
Most people don’t really know what to do. If they did, they’d be doing it. So take the
understanding they don’t know what to do, but they don’t even know they don’t know, or if
they do know, they are ashamed and afraid to reveal it. So benevolently, and nurturously, and
empathetically, and respectfully help them learn what is possible.
People are searching for ways to make the next investment decision, or the next
business decision, or the next life decision better. Solve their problem for them today.
Why do I want to take advantage of The Strategy of Preeminence?
List the most important ways I will implement what I have learned so far:
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Jay Abraham’s
Jay Abraham 101

A Brief Overview
Of
The Jay Abraham Philosophy
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Jay Abraham 101
A Brief Overview of
The Jay Abraham Philosophy
© 2005 The Abraham Group, Inc. - All Rights Reserved
This document is provided under license and may not be modified,

re-sold, licensed, assigned, offered as a bonus or auctioned without
the prior written consent of The Abraham Group, Inc.
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122B Jay Abraham 101 – A Brief Overview of the Jay Abraham Philosophy
77B JAY ABRAHAM 101
78B A BRIEF OVERVIEW OF THE JAY ABRAHAM PHILOSOPHY

AND STRATEGIES FOR CREATING GREATER SUCCESS, INCOME AND WEALTH
I have a very simple philosophy on life. You shouldn’t steal from yourself. If
you’re going to commit your life to an enterprise, wealth creation, the security and
the financial well-being of your family… and if other people¾ your staff, your team,
your employees, your vendors¾ are going to commit their lives to you, you owe it to
yourself and to everyone else to get the highest and best results. You should never
accept a fraction of the yield when with the same effort or less, the same people or
fewer, the same time or less, the same capital or less, the same opportunity cost or
less, can deliver so much more to you currently, and perpetually.
Jay Abraham
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79B 1. MARKET DRIVERS
Market drivers are the key elements that give you optimal leverage and enhanced
performance on a sustained basis in your business. Marketing: Change your marketing,
change your results. Enormous leverage, up to 2100% leverage in each improved activity you
do-if you put a system together that’s not only operational, but also continually tests,
monitors, measures.
80B 2. STRATEGY
Change of strategy is the fastest, easiest, most powerful way to change your results.
81B 3. CAPITAL
Human, intellectual, and financial. Human capital is the people working for you. Intellectual
capital is the intellectual property. It could be the proprietary systems, the procedures that
are unique and distinctive to you. And financial capital is how you deploy it. There’s
enormous upside leverage in all three of those.
82B 4. YOUR BUSINESS MODEL

Your business model is decisively different than your strategy. You can have a big, sweeping
strategy, but the model may be wrong, and the strategy will perform adequately, but not to
the maximum or optimally for you.
83B 5. RELATIONSHIPS
The business relationships, the professional relationships, the collegial relationships, the
mastermind relationships must be developed, nurtured, and cared for on a continuous basis.
NOTES: What I have learned and what I will do differently:
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84B 6. DISTRIBUTION CHANNELS
This is a very sweeping concept that describes all the different means you have of impacting
the market. From the advertising you do to the selling organization you have, to the network
of associations you use¾it’s a very broad and sweeping area.
7. PRODUCTS AND SERVICES

The different products and services you have or you create will give you enormously greater
or less leverage, frequency of purchase and profit. It will give you enormously renewed
ability to get far greater yield and sustained income from the relationships that you breed
with clients.
85B 8. PROCEDURES AND PROCESSES

The key ingredient to those that had built their companies over $100 million, is in the
discipline of the entrepreneur more so than it was in the idea. Meaning, there are a lot of
banks in the world, but only one became Citibank. The key ingredient to your greatness is in
these three words (and you cannot build a great company without them): Planning, Policies
and Procedures. Hopefully, you’re beginning to see that companies bound for greatness are
“structured” to achieve said greatness.
To build a great organization, you have to start taking all the goals and plans and use them to
create structure in your organization. One of the key traits of very successful people is that
they use what we call “The Three P’s.” That’s the third competency.
A McDonald’s in Harlem runs just as profitably (and predictably) as a McDonald’s in Beverly Hills, because there is no area that does not
have the procedures down to the letter. What’s more, the employee turnover rate at McDonald’s is 200% per year, but it doesn’t matter.
Everything is so well spelled out that new people can be put into the system and function at an optimum level very quickly.
If you ever want to have a business that can function without you, or replace staff with
people who enter the business at peak performance, right from the start, you must have
excellent policies, procedures and plans.
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86B 9. IDEOLOGY
What is the thinking that you’re basing your operating system around? It’s different than
your strategy.
87B 10. THE FOUNDATION OF ABRAHAM 101

I’ve been obsessed with the question of why some companies are 100, 1000 times more
successful than others. Why a Fortune 1000 company is so different than a small or medium-
sized entrepreneurial one. And how to turn reactive, tactically oriented, non-systematic
business people into very much the opposite¾Into supremely sophisticated, supremely
strategic, supremely proactive organizations. Following is a brief overview of the strategies
and concepts that will enable you to attain those higher levels.
88B 11. UPSIDE LEVERAGE

Almost everything you do has infinitely greater upside leverage, and you can control or
eliminate the downside. If you can make the same action, the same activity, the same
person, the same capital, the same client, everything produce more, yield greater results and
performance, then sustain it¾the combined effect is geometric growth. I’m believe in
working on the geometry of your business. I’m all about optimizing. Maximum result,
minimum effort, minimum expense, minimum time, and minimum risk.
89B 12. MAXIMIZE WHAT YOU’RE DOING

Maximize What You’re Already Doing. Whether Jay Abraham is in your life or not, this is the
first thing you have to do. You have what I call “critical mass and velocity.” You have all these
activities going on. You have sales people. You have ads running. You have people calling.
You have word of mouth, phone calls, customer service. You have all these contact and
impact points.
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And you must, first of all, maximize what you’re currently doing before you can go out and
rebuild your organization. And you can’t maximize what you’re currently doing if you don’t
break it down to its core processes. Because only when you do that can you measure, can
you quantify, can you improve. So you have to figure out what you’re doing right now, and
break it down to its core driver. And that means, if you’re doing selling, you have to realize
how well you’re doing at opening new accounts. How well are you doing at targeting the
media? How well are you doing during the average hour? How well are you doing in
different kinds of categories? How well are you doing at different product sales? How well
are you doing at different geographies? Because until you know how you’re doing you can’t
maximize your performance.

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90B 13. EXAMINE AND EVALUATE

You can’t maximize the performance of the methodologies behind all of those categories
you’re going to now measure and monitor, until you first examine and evaluate all the
higher performing options and opportunities out there. And you can’t do that unless you
decide you’re going to travel outside of your industry. You have to carefully evaluate and
borrow the success processes, thinking and approaches from all kinds of industries other
than yours. Because if all you do is try to monitor and emulate what people in your industry
are doing, you’re going to be limited to incremental and linear growth.
91B 14. FUNNEL VISION VS. TUNNEL VISION

So you have to borrow the success processes from outside your industry. And that requires a
process I call “funnel vision vs. tunnel vision.” Most people spend their whole time in one
field. And the most they try to do is emulate or plagiarize what their slightly or somewhat
more aggressive or successful competitor does¾that’s funnel vision. Tunnel vision is saying,
“I want to know better ways!” not just to sell, but if your goal is to find new prospects, and
your method of doing that is to run an ad in the trade publications, what are 20 other
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industries doing to ‘find new prospects’ other than running an ad in trade publications? And
borrowing success processes from outside your market saves you time on the learning curve.
It saves you the capital investment. And it also has the impact of an atom bomb. If you are
the first and the only company to introduce selling approaches, strategic distinctions, and
operating systems into your field that are matter-of-fact to other industries, but no one else
in your industry has ever seen it before or experienced it, it will knock your competitors for a
loop. It will distinguish you in such a powerful and preeminent way in your marketplace that
you will own it. You will literally own it.
92B 15. MARKETING AND INNOVATION

Marketing and innovation are the two greatest levels you have. You have to be resigned and
committed to engineering breakthroughs. Innovation is not necessarily high tech, although it
can be. Innovation is bringing greater advantage to the client that the client perceives and
values. It can be the simplest, most mundane, most non-technical value added imaginable. I
spend a lot of time studying the most successful performing companies in their category.
What I’ve learned in analyzing them is that they tend to be the companies that engineer and
introduce the most consistent, quality breakthroughs. And they do it on a continuous basis
in the areas of strategy, marketing, innovation and management. So you have to be
committed to engineering breakthroughs.
93B 16. THE STRATEGY OF PREEMINENCE

You have to change your philosophical approach and move to what I call a “Strategy of
Preeminence,” which is a whole new way of looking at the relationship you have with your
marketplace. It’s seeing yourselves, and your company, and everyone in your organization as
the ultimate fiduciary, as an advisor, as a trusted, respected, expert advisor. And you have
the responsibility and the obligation to counsel those people in what’s in their best interest.
To give them the best short and long-term outcome. And when you start advising them with
their best interest at heart, you no longer will accept or allow them to buy less than they
should… fewer combinations than they should… less quality of products or services than
they should… and less frequently than they should. You’ll never again, take the order just
because they’re willing to buy. You will never again be struggling with how to manipulate,
what kind of things to say or do. You’ll always be focused on the fact that the more value
you add, that is perceived by them, the more success you will have. You will start thinking of
your relationship with them all as “clients.” If you talk to them or think of them all as
customers, you should change – and I’ll tell you why. In a world that is trying to slam
everyone down to commodity and marginalized status, you have to draw a line in the sand
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and distinguish yourself. And the way to do that is to start thinking of your relationship as
an advisor, and the people you deal with as clients.
Look up the word “customer.” And look up the word “client.” “Customer” is defined as,
“someone who buys a commodity or a service.” “Client” is defined as, “someone who’s
under the care and the protection of another.” You want to move the whole relationship
that you have with your “customer” to where they are your “client.” Someone you see as
under your care and your protection. Someone whose well being is important to you.
The biggest problem that I observe with companies that I serve, and most companies that I
study, is they fall in love with the wrong thing. They want their company to be the fastest
growing, the biggest, and the best, the Inc. 100, the Inc. One, Fortune 500. They fall in love
with the mega-organization, the worldwide impact.
The way to greatness today is to transfer your ultimate passion away from your product,
your service, your company, and instead, fall in love with your client. If they’re at the top of
your awareness all the time, and if all you focus on is constantly getting them the very
richest, the very best, the most productive, the most profitable, the most enjoyable, the
most enriching, the greatest protection in whatever your product or service provides… you
will dominate everyone else in your business sector, because they don’t look at it that way.
They’re in love with having the biggest company, and as a result, they don’t.
You also have to fall in love with your three tiers of “clients.” The people who pay you and
the two tiers of people you pay. You have to fall in love with your team members, and you
have to want greatness for them. And you have to know that you are the vehicle to their and
their families’ richness and security. And you have to envision the fact that their kids are
going to go to college because of you, and lives are going to be enriched because of you.
Just as with your clients, you have to see their businesses or their personal lives thrive, their
prosperity grow, and their security enhanced. If you can’t visualize that you’re going to lose
torque.
A Strategy of Preeminence is truly transforming. It’s the most liberating, the most animating,
and it’s the most passionate concept you’ll ever embrace.
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94B 17. THREE WAYS TO GROW A BUSINESS

Most people grow their business incrementally and linear, because they fix in only on
growing more clients. But, if you grow clients and you focus on increasing the size of the
transaction and you increase the frequency of each client’s purchase, you’ll increase your
revenue and income 100%, 200% or more.
If you work on all three ways to grow a business at the same time, and all you did was
improve all three ways by a mere 10%, it brings the power of geometry to bear. I have this
quick exercise I put people through—it shows that if you had 1,000 active—clients, and if
you had an average order of $100 for each time they were coming in, if they bought two
times a year, that works out to an annual revenue of $200,000.
# of Clients Transaction Value per Client Transactions per Year Total Income
1,000 x $100 x 2 = $200,000
But if all you did was increase those three categories by a mere 10% each…
# of Clients Transaction Value per Client Transactions per Year Total Income
1,100 x $110 x 2.2 = $266,200
It would increase your annual revenue to $266,200—a 33% increase. And if you increased
those three categories at the same time by 25%, it would almost double your performance
to $390, 625.
If you don’t focus on geometric growth, if you don’t work on the geometry of your business,
then you’re going to always work harder for your company than your company will work for
you. Your goal is to get your company working harder and harder for you in a perpetual
manner. To put systems in place that will sustain, thrive and survive so you’re building an
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asset¾an asset that will be worth so many times more than the mere increases in income,
in earnings, in salary or in dividends that linear thinking produces.
95B 18. POWER PARTHENON OF GEOMETRIC BUSINESS GROWTH

This concept is predicated on the very, very simple assumption that 99% of all companies
today, and 99% of all companies ten years ago, generate the vast majority of their revenue,
and income from one primary revenue activity. And that’s the dumbest thing in the world,
because with just one pillar supporting the entire revenue stream (it looks to me like a diving
board,) it is very, very, very precarious. A diving board has never been a means for
propelling anyone upward to growth on a sustained basis. You do go up for a moment in
time, but eventually you plummet back down. I try to get everyone I work with to build
pillars and pillars and pillars¾not unlike the Parthenon in Greece¾of additional,
complimentary revenue and income-generating approaches borrowed from outside their
industry. And if each one only adds 10% more… 15% more… 20% more… the combined
geometric effect can be hundreds and hundreds of percent growth. And everyone thinks
that my press and my track records are almost hyperbolically ludicrous. They’re not. I’m just
one of the few people who understands how much more you can actually get out of an
opportunity, out of an effort, out of a day.
96B 19. THE FORCE MULTIPLIER EFFECT

“The Force Multiplier Effect” is a military term. It’s defined as the capability that, when added to and
employed by a combat force, significantly increases the combat potential of that force. And thus
enhances the probability of successful mission accomplishments. It’s the militaristic discipline of
creating multiple avenues of penetration at the same time. Going by land, going by sea, funnel
attack, side attack, surprise attack, missiles, going ahead to penetrate and soften the market, air
attack, land attack, sea attack, stealth attack. And it’s a proven process of dominating your enemy in
military terms. And when you apply it to your business, you can dominate and preeminently own
your market. It’s letting the full force of many different factors carry you to greatness without you
having to lug it and push it.
97B 20. THE 12 STRATEGIC PILLARS OF STRATEGY

These are what I believe are twelve of the strategy pillars you must incorporate into your
business philosophy from today forward.
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21. CONTINUALLY IDENTIFYING AND DISCOVERING HIDDEN ASSETS IN YOUR
98B
BUSINESS
Every business has hidden assets, overlooked opportunities, underperforming activities,
undervalued relationships, untapped resources and intellectual capital. And until you
commit, to monitor, to examine, to mine those on a continuous basis, you’ll never maximize
your performance income or profit.

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99B 22. MINING WINDFALLS OUT OF YOUR BUSINESS EACH AND EVERY MONTH
It is very important psychologically to produce short-term wins. It’s important to get them to
validate that the course you’re on is correct. They don’t have to be big victories, although
they tend to create, in combination, extraordinarily substantial results when the exponential
impact applies. But you have to be committed that every month you want a windfall. It could
be a market windfall, a strategy windfall or a sales windfall. But you have to be committed to
that as an objective and a goal that you must fulfill every month.
23. ENGINEERING SUCCESSES INTO EVERY ACTION YOU TAKE OR DECISION YOU
100B
MAKE
Most people are reactive, and not pragmatic. They’re not logical. They’re not strategic.
They’re reactively tactical, and it’s the worst thing in the world. You have to learn to take a
deep breath and reflect, and be much more systematic and much more global in the way
you look at all the integration of what’s going on in your world.
101B 24. MULTIPLE PROFIT SOURCES

You must build your business on a foundation of Multiple Profit Sources instead of
depending on one single revenue source. Why grow incrementally or linear if you can grow
geometrically and exponentially with the same time, effort and capital.
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Let geometry work for you. Geometry is not 2 + 2. It’s 2 x 2 x 2. It’s basically bringing three
different factors, or more, together. You have to bring continuous processes to work for
you¾a foundation of multiple profit sources.
25. USP
Being different, distinctive, special, unique, and advantageous in the eyes of your clients is
basic to your success. The concept of “Unique Selling Proposition” no longer is merely having
an advantage over your competitors. Today you have to be seen as the only viable solution,
strategy or opportunity for the problem or desire that your marketplace is trying to address.
And you have to be much more refined in it, because there are too many choices. Needs
today may be singular, but means to fill them are so vast it’s scary.
102B 26. CREATING REAL VALUE FOR YOUR CLIENTS

Creating real value based for your clients means creating value based on what your clients
define value to be for them. And value for employees for maximum loyalty, results, and
sustaining relationship.
103B 27. MAXIMIZE PERSONAL LEVERAGE

You must focus on getting the maximum personal leverage from every action, investment,
time or energy commitment you ever make. This is a simple concept, but you probably don’t
have this approach indelibly embedded in your mind, and you don’t adhere to it. Just by
bringing this thinking to bear is going to dramatically improve your results.
104B 28. NETWORKING, MASTERMINDING, BRAIN STORMING

You must start networking, masterminding, brainstorming with like-minded, success-driven
people from outside your industry who can share perspectives, real life experiences and
recommendations with you. If you look at all the great achievers, they have brain trusts.
They have kitchen cabinets. They have mastermind alliances. They hvae advisory boards
galore. If you’re a lonely entrepreneur out there trying to knock it alone, and you’re not
getting perspective from other people, you’re making it very hard for yourself.
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105B 29. BE AN IDEA GENERATOR

Turning yourself into an idea generator and recognized innovator within your industry or
market will propel you from the middle of the pack to the leader in your market.
106B 30. GROWTH THINKING

Making growth thinking a natural part of your everyday business philosophy sounds simple,
but few actually do it. You can’t just give lip service and say, “Yeah, we want to grow.”
Everything you do must be driven through the screen, the filter and the lens of dedication to
growth thinking. Always ask yourself “Is this going to facilitate, is this going to contribute,
and is this going to bring about our growth or not?”
107B 31. RISK REVERSAL

You will gain more clients and keep more clients by reversing the risk for both you and your
clients in everything you do so the downside is almost zero and the upside potential nearly
infinite.
108B 32. TESTING

When you use safe, small tests you’ll eliminate the dangerous risks and costly misteps.
You’ll be inspired and spiritually animated to enthusiastically, continually test, experiment,
try. What you don’t want to ever do is go down looking at the third strike, using a baseball
analogy. You want to swing for it, but you don’t want to swing for it like Casey at the bat.
Getting a lot of singles and never striking out will win the game more predictably than
anything else you can do.
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109B 33. MINDSET FACTORS
There are mindset factors that I believe are very important for you to reflect on. You have to
be able to set and achieve your own lofty goals. And you have to be able to recognize the
process to achieve them. Many people have goals, but very few people reverse engineer the
systematic sequence of simple actions necessary to get them to that outcome.
You have to develop a process to effectively overcome obstacles. Struggling with challenges
is a waste. Overcoming them, resolving them, circumventing them is a mindset that you
must to install.
110B 34. POSTIVE ATTITUDE

Lost the negative attitude. You can’t let your glass ceiling thwart you. You have to have the
right attitude. You can’t think in negative terms. It’s simple, it’s axiomatic, Logic 101. When
you get the passion and the vision for what’s possible, when you get the system, the policy
and the procedures, and you see how predictably, how pragmatically, how sequentially and
how quickly you can do it, your whole mindset is going to change. You have to realize and
believe that this will work, but there are going to be challenges. The truth of the matter is,
adversity is opportunity. And when you believe that with every filament of your being,
you’re going to maximize and optimize everything you do.
111B 35. PERSISTENCE

You have to be committed to persistence. Persistence is like the military. They hope that
their frontal attack works, but they’re not going to leave the war and put up the white flag if
they’re confronted with resistance. They’re going to go from the side, from above, from
underneath. They’re going to go by day, by night. They’re going to send unmanned missiles.
And they’re going to do everything, because they want to win the war. Sure, it would be
great if they could do it in one death-fell swoop. But they’re prepared to do whatever it
takes to be victorious. If you are not prepared to do that, you may not be victorious.
112B 36. ETHICS

Throughout all of this, you have to distinguish yourself and operate at the highest level of
ethics, of integrity, of veracity. If you lower yourself to the level of a lot of the people in the
world today, you won’t be distinctive. You won’t be preeminent. You won’t stand out. If you
operate at this high level, you will win over people and they will stay with you when you
have the right systems and strategy in place.
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113B 37. VISION AND PROCESS
The vision you paint will enable you to see exactly the sequence of events, to exponential
growth and success. Having a vision is very difficult if you don’t have the process to get
there. Just holding this big vision out there and believing it, is wonderful. But if you see each
step of the way, and when you take one, you knock that off, and you’re getting closer. It’s
like I know that I want to go there, but I can count off and say, “It’s 23 steps.” And starting,
you say, “OK, one, two¾now it’s only 21 steps. Three, four¾now it’s only 19 steps. Five,
six¾now it’s only 17 steps.” And it’s closer and closer.

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114B 38. REINVESTING

You have to be willing to take, not dangerous risks, but make calculated investments in your
future. And one of the biggest disappointments—and it almost makes me cry¾when I look
at businesses that won’t reinvest a portion of their increased revenue. They’ll get a windfall
that I would help them stimulate of two, three, $400,000, and instead of taking 50% of that
and putting it into new people, or more marketing, or more selling systems, or buying more
leads, or more starts in clients¾they’ll just put it in their pocket and walk away. They don’t
reinvest, so they don’t realize exponential growth. Parlaying your successes by investing
strategically and systematically in the future is critical to your success.
115B 39. BEING FEARLESS

The sky won’t fall. The world’s not going to collapse. You won’t go broke or look stupid.
Quite the opposite is the case once you adapt this philosophy. Really, doom and failure only
go to those who stay stuck in the status quo. You have to be resigned and resolved to learn
from the mistakes of others. It’ll save you millions. It’ll save you years. It’ll save you
emotional hardship. And it will catapult and propel you so many levels and rungs higher so
fast, if you’re committed to do it.
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116B 40. DAILY MOTIVATION
You really do have to review and revisit this belief system every day. I don’t care how great
your mind and your memory is, you retain about 3% of the boring things you learn. If it’s
more exciting and more diverse, you retain about 7%. The first thing in process training is
reviewing on a continuous basis what your vision is, what your goal is, what you’re going
after, what your system is. Because if you don’t, you’ll forget it.
117B 41. YOUR NEW SUCCESS

How you handle your newfound success as you build it is very critical. And it’s a very
different change from the way you may have managed mediocrity or a plateau that you’re
on today.
118B 42. GIVING BACK

You have to give back to others, just the way; hopefully, people are giving back to you.
119B 43. SUCCESSION

And finally, what I call “succession.” It’s an idea that’s really powerful. It’s the process of
getting other massively successful individuals to pass on their best-kept success secrets,
strategies and philosophies to you so you can, again, shorten the timeline to greater success
and wealth.
120B IN SUMMARY…
Great marketers are made, not born. It requires discipline, a precise system, and a highly
strategic plan to really develop your personal marketing genius. It also requires a very
different mindset than the one all your competitors use. If you want to grow your business
like a weed, gain a decisive competitive advantage, attract new clients in droves, and double
and redouble your profits --- then you need to open your mind to one overriding “big” idea:
It’s a fact: My marketing methods can work true performance miracles for your business. But
you will never reap their rich rewards, unless you develop a systematic process to harness,
harvest and strategically implement them. But most people don’t know how to implement a
strategic marketing system. Will you?
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How did this section motivate you to apply different strategies to your business? List
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List the most important steps to a strategic marketing system and explain each step:
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Three Advanced Ways to Grow Your Business, Even FASTER,
SAFER, EASIER
Penetrating New Markets (7 ways to do this):
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Adding New Products / Services (10 ways to do it):
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Purchasing your competitors’ Business or Assets (5 ways to do it):
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Jay Abraham’s “4 Steps to Greatness” and Adding Value
I believe every human being inherently wants to be great. They’re programmed for it.
They’re programmed to perform at optimum capacity.
Do you really want to be average? I was empathically talking to a sales manager for a
very large company that had a bunch of commissioned salespeople and they were having a
very high turnover, high attrition. I asked him, “Do you really think that somebody takes a
job with you, wanting to come back every day and say ‘I didn’t produce anything’?” Do you
think they want to go home to their family and say, “Honey, I’m mediocre, I’m not
productive.”?
Every human being wants to be great. They want to be great in their business. They
want to be a great employee, salesperson, entrepreneur, leader, innovator, and contributor.
They really do. They want to be a great husband, wife, father, mother, lover, and factor in
the community. If they’re not, then it goes to these reasons. I just don’t think you really want
to be mediocre. Do you really want to be average? Do you really want to be performing at a
fraction of a fraction of the capacity that you were innately destined and designed to
achieve? I don’t think so.
I think it’s almost like somebody who’s sick with a very bad, but curable disease. They
don’t feel right. Think about it. Most people deep down, don’t feel right. That’s why there’s
dissatisfaction, that’s why there’s unhappiness, that’s why we are supposed to be
performing, achieving, operation, contributing, impacting at a much higher level, and it
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doesn’t feel right. It’s like somebody who has an illness, they know it just doesn’t feel right.
They just don’t know what it is.
I think there’s almost an inherent factor in a lot of people in the world today. If you
look at causation, the basis, the factor, the cause, it’s because we have been allowed to
operate in a world of mediocrity. I think that our beings, our human beings, are not designed
to be mediocre. We are designed to perform at the pinnacle of greatness.
I think what’s hard sometimes for people, is that there’s sort of a cognitive dissidence
that goes on. They want to achieve this greatness; they feel they should be contributing
more.
When you look at the statistics out there in the world, with 97% of people never
achieving financial independence, 50% of people getting divorced, and 95% of all new
businesses and entrepreneurs don’t end of making it. Given those odds, how is it that people
are programmed for greatness, or how is it in some ways that people can overcome these
steep odds to become great?
This is an evolving ideology and philosophy that I’m sharing with you. Why do you
think people have dissidence? Why do they have a bad marriage? Because inherently,
they’re not fulfilled. What is fulfillment? Fulfillment is really operating at the peak of what
you’re capable of, isn’t it?
You know deep down inherently but we don’t put words on it. We don’t know how
to articulate or verbalize the essence of how we feel. We feel frustrated. We feel unfulfilled.
We feel incomplete. We feel disconnected. We feel rudderless. All that is an explanation of
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mediocrity. We don’t feel really like we are achieving all we could in a marriage.
Unfortunately, the superficial response to it is either blaming someone else, or it’s
extricating us from the uncomfortable environment. You can’t really escape yourself. That’s
the irony.
One of the reasons I think most people don’t even recognize it, is that our society has
not, until lately, been designed to stimulate, or nourish it. A lot of employers try to squeeze
everything they can out of people. They don’t try to grow and develop or improve them.
I’ll give you the four ways to achieve Greatness. The first thing to realize is that
there’s no shame and it’s not necessarily your fault, because environment, education, and
influences, have reinforced and stimulated, unintentionally, unknowingly mediocrity.
Let me explain.
FIRST STEP:
I don’t think most people can achieve their greatness for the first reason: they don’t
have an idea, or a picture in their mind’s eye of what greatness looks like. What greatness
looks like as an employee? What greatness looks like as a leader if you’re an entrepreneur or
a professional? What greatness looks like as a father, mother, husband, wife, and lover?
You need a clear-cut picture of what greatness looks like, almost as a CAT scan,
three-dimensional view. What it looks like and feels like for the receiving side. That’s so
much difference and better. You’ve got to have a real context of understanding. There’s a lot
of ways to get there, but the first is to look outside yourself at people you really admire, and
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see people who are operating in a rarified strata that you have not. It could be a whole
bunch of different things.
One of my greatest influences was a guy who wrote a book 30 or 40 years ago. He
commented about a guy he met, a blue-collar worker, but he did everything full-out and he
loved it and took pride in it. We need some kind of reference to know what greatness is
supposed to look like. Not just one-dimensionally, but multi-dimensionally, in every
implication and application of our lives. From professional career, personal, familial,
parental, relational, and more.
If you’re miserable, if you’re overweight, and you could do it for yourself, you’d be
the right weight. If you’re in a very bad financial condition, and you knew how to do it
yourself, you would probably extricate yourself. Somebody said something about me at the
turn of our new century, and I think it was right: The greatest determinant of greatness,
ironically and success in the 21st century, is going to be our ability to collaborate, creatively
and cooperatively with others who have pieces of the puzzle we don’t.
I have a piece of the puzzle.
The fact that I’m sharing that you don’t know you’re supposed to be great, and that
you don’t have a picture of what it’s supposed to look like, has already given you an
advantage over almost everybody else because they don’t know they’re supposed to be
great, and they didn’t even read this.
Greatness is relative. We’re not one size of greatness fits all. I’m a 24/7, take no
prisoners, type of a guy. You don’t have to be that. I have many children. I have seven. One
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of my sons is a very wonderful, eclectic, creative sort. I would not care if he were a garbage
collector, as long as he was the greatest garbage collector he could be and he did it full-out.
As long as he took pride in taking the garbage away from people, and he felt really good
about, not only about himself, but the value he contributed.
I think the key is everyone wants to aspire to be somebody else. It’s frustrating
because you can’t be me and I can’t be you, and I shouldn’t. We should be ourselves. We
just need to figure out what greatness is within us. We all have certain preordained
attributes, skills, prejudices, and abilities. We don’t need to be who we’re not. We just need
to be who we were supposed to be, as a very unique, very distinctive, wonderful and
remarkable individual.
Remember, you have to realize you’re programmed for greatness. You probably
don’t have a clue what greatness looks like. Greatness has a lot of dimensions. It means
greatness as an employee, greatness as a business owner, leader, developer of others,
greatness as a father, mother, husband, human being. I think if you did some soul searching,
you’ll sense that a lot of your frustrations, stress, discontent, or ambivalence is a
manifestation of your perception but not your verbalization that “I’m operating at
mediocrity. I’m being average, when I was designed, destined, programmed to be so much
better than this, I just don’t know how.”
SECOND STEP:
You have to figure out what path will get you to a better place. The thing I think is
problematic about a lot of people is they buy into the first shiny object they hear/see. What
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I’ve been taught, is that there are lots of ways to get an outcome, but there’s almost always
going to be one way (and it’s going to be different for each person) that’s faster, safer and
more fulfilling.
Example: It’s like saying we want to go on vacation, but we don’t know where we
want to go. I’m using a very simple graphic. Do we want to go where it’s hot or
where it’s cold? Where it’s rural or where it’s urban? Do you want a penthouse of a
100-story hotel, or a shack in Bali? It’s interesting. Where are we now? Are we
coming from the East, the West, the North, the South, Europe, Australia, and Los
Angeles? Then you need to say, “How can I get there?” You could fly, take a boat,
probably can’t take a car, given that distinction. What path is going to get me there?
This is where it gets interesting, because a lot of people thwart themselves. They
choose a path that’s ahead of themselves. It’s like saying, “I want to be a pole vaulter.
Instead of starting out with a little pole and seeing if I can go four feet, I’m going to try to set
the Olympic record.”
What path is going to get me there, not just the quickest, but the safest and most
enjoyable? If it’s painful, everything is stretching, and the growing is a little bit painful. Your
muscle growth is painful when you work out. I think you’ve got to realize you have options.
The wonderful thing about the world today, about the human being is that we have a lot of
paths to get us to our greatest outcome.
I deal in something called optimum. Optimum isn’t just the highest and best. It’s the
highest and best path for you. Again, you can’t be Jay Abraham. Maybe you can be some
other expert. I don’t know why you would want to, when you’re pretty wonderful yourself,
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if you allow yourself to realize, to grow into, and to manifest the greatness that’s already
programmed within you.
Let’s review the first 2 steps.
First, what does it look like in every facet so you can regroup and you can recalibrate
yourself? What’s it feel like inside and outside? You have to think, “If I’m receiving that
greatness, how’s it going to differ?” Most people don’t think about that. They’re self-
consumed. That’s the beginning of the end, because all of life is about interactions. It’s about
relationships. It’s about connecting whether you like it or not. You’ve got to factor that into
it.
Second, what path that’s going to get you there, the best way for who you are and
where you are? If you don’t know where you are, relative to where you’re trying to get to,
there’s no way you can do that.
THIRD STEP:
Most people don’t have enough self-confidence in themselves to even set out on the
path, or to pursue the path. It’s a tragedy, but you know this. There’s been a statement that
something like 80% of the books purchased and CD and DVD sets bought are never opened
or looked at. People don’t have enough confidence in themselves to not only pursue it, and
embrace the adventure, the journey, the process, but they don’t believe they are deserving.
The first thing is, picture what it is. The second thing is, how can you get there? The
third is having enough and giving yourself permission to start walking down the path to
your greatness in as many different categories as you can pursue. Don’t try to do everything
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concurrently, because it will diffuse. Figure out where you can make the biggest win for
yourself first. That’s going to reinforce the worth, and you’re going to see such a difference
that you’ll want it in every other element of your life.
FOURTH STEP:
Lastly, and this step is very simple. Most people don’t have enough conviction and
commitment to identify the path. Even if they have enough fortitude, courage, desire or
perception of what’s on the other side of the mountain, to get started, what frequently
happens in every form of human endeavor is: the first time you try something and it doesn’t
execute very well, you get derailed.
Think about it. Did you ever try to play tennis or golf or work out in a different way,
or do weights or gain a skill or language? It’s daunting. What happens to most people is they
abandon, give up, they jettison it, the first time it gets difficult. Most people get derailed
very quickly down the path. They get into a quagmire, and fall into their own quicksand.
Few people have someone who’s willing to intervene and help get them back on
track and course-correct. People need someone to believe in them and advocate a champion
long enough to where the momentum, velocity and the force going forward will take over
and propel you to your greatness.
Important: You want somebody who has an extraordinary hopefulness for you
because he or she knows how much more is possible. It doesn’t mean they want you
to be who you’re not. They want you to fulfill your destiny path within your own life.
They know that you’re accepting a fraction of a fraction of yield, success, financial,
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psychic, fulfillment, and satisfaction. They want to help you discover and reprogram
your actions and your belief systems, somebody who’s been there and done that. Not
somebody who’s self-anointed. You want somebody who’s got an understanding –
clinically, critically, transactionally and empirically. Meaning they’ve really done it.
They have to be able to be PREEMINENT. Preeminence is another way of articulating
greatness. It starts with an external focus. It starts with a love for mankind, and a desire to
add value and a very strong belief in the betterment of one another. A really great mentor
has the ability to really see within you, what you can be, and what you can be in many
dimensions.
I did a program called “Masterful Thinking Partners.” It was the ability to connect
someone to somebody who didn’t just have one piece of the puzzle, but saw the whole
totality of forces, factors and elements that were negatively, adversely, influencing,
impacting, and prejudicing their attitude, actions, and self image.
Those are the 4 Steps to Greatness.
1. What is greatness supposed to look like? Picture what it is.
2. How can you get there? What path do you need to take?
3. Have enough and giving yourself permission to start walking down the path to your
greatness in as many different categories as you can pursue.
4. People need someone to believe in them and advocate a champion long enough to
where the momentum, velocity and the force going forward will take over and propel
you to your greatness.

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I’m going to give you a different context. I used to coach what I’ll call “bumble-bee
beginners/newbie’s.” Soccer, basketball. Everyone was bumping into each other. Nobody
knew what they were doing. I saw my role to make the experience so satisfying that the child
felt so good about themselves that their body language changed, and they looked forward to
doing it the next year with somebody who was probably a better person on proficiency.
If I had a child who was awkward and timid, in soccer, I would get behind him and we’d
walk him on the field, hold their legs and kick for them, so they could feel how much joy
there was in having connection, forward motion, and accomplishment. You could just look
at their little bodies and their little faces and see the joy evoked from them.
I think the big tragedy in society today is that most people don’t have a lot of other
people believing in them. They have a lot of people taking their money. They have a lot of
people squeezing them. It’s a very competitive world. It’s easy for people to bail on
marriages, on jobs, on employees, and get their money back on this or that. We don’t have a
society that is trying to nourish, nurture, harness and harvest for people, their greatness.
I think the first thing for everyone to realize is there’s no shame. Those four factors, as
simple as they are, are not evident in many people. Most people don’t have a clue.
Think of your life like a high-powered jet plane, flying from Los Angeles to New York. We
take off okay, but the flaps won’t move the right way. Here’s what it means. Number one,
you’re going to spend an enormous amount of fuel and energy. Number two, you are going
to spend an enormous amount of work trying to get back on course, because it is going to go
everywhere. Number three, it is going to take a lot longer. Number four, it is going to be a
very dissatisfying ride.

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If you think about your life, and you can break it into as many dimensions and categories
(career, marriage, romantic, parental, relational, friends and interactions, connectivity with
your world), you can get into purpose, legacy, contribution, and fulfillment. If not, it is
partially lived and very unfulfilling. I think we have an unfulfilled world today because no one
has tried very hard. There are people doing it, but only with one piece of the puzzle.
I spent my life trying to work on the aggregate leverage in business, and accidentally in
life. I am looking for those understandings that will first explain feelings and
accomplishments. Accomplishments sounds like a positive, but you can have negative
accomplishments. You can look back and say, “My career’s unsatisfying. I didn’t make a lot of
money.” You can say, “My business is mediocre. I’m not doing well.” I think it is an
accomplishment; it is just a negative one. I think the first step is getting clarity on the
moment you understand the reason why. Once someone understands the reason why
something is the way it is, or is not, it gives great clarity. That clarity gives you greater focus.
The first thing you have to know is what you do not want, in order to get what you do
want. If you do not have a context of what you want looks like, it is very hard to get there.
Then you have to figure out what you do not and do want. What path is going to get you
there the most optimal, comfortable, the most satisfying for who, what, and where you are?
Not for someone else. That is a big problem. Everyone says, “One size fits all.” One size does
not fit all.
The real beauty is, giving back. It seems selfless, but it is the most selfish thing you can
do. The more you help others, the clearer it becomes to you, the more you see the dynamic
work.
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When I was young, I used to be obsessed with making money, stature and materialism. I
have a lot of cool things. What I realized, one period in my life, when I made the most
amount of money (and I was young), I was the most dissatisfied. I sought perspective from a
lot of people, and I had one person that taught me something that transformed and
reignited the passion and the purpose in my life. This person said, most people are obsessed
with the end product. They want to make then million dollars, or they want to have the
fastest growing company, or the best body or whatever. If they are unfortunate enough to
get that for that reason alone, it is totally anti-climactic. Life is not going to transform. It is
going to be nothing.
What life is all about is the process. Have a discussion with the intention of
contributing, explaining, hopefully inspiring and redirecting the thinking of people. If we
were sitting at a bus stop talking to a retiree, or in a hotel lobby and there was an employee
walking by, our job is to add value. It is to enjoy the process, because that is about as good
as it gets.
Somebody very profound, who I met right after they had a very business setback and
bounced back, shared their philosophy with me. It was very simplistic. Any time you get the
chance to spend any time with anyone, you come together for any reason, for any amount
of time, make the other side better off because you were in their life, whether it be a
moment or not. We go overseas, and we go sit in the lobby, sometimes in countries where
people tend to be very closed-minded, and we smile until they break a smile. It is the most
joyous thing in the world to watch the body language change.
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I think (when you realize in life), when you add value, you get value back. It’s like a
compound reciprocal dividend. I think we have this great opportunity in our life to make this
incredible difference in a moment, by listening, acknowledging, comforting, believing in
others, demonstrating that your life is relevant. I think we lose track of that, sometimes in
our ultra-competitive, material/financially – obsessed world.
I hope I have implemented value and given you a little bit of greater clarity on two
things: why people aren’t satisfied and how to become more satisfied with life, career,
relationships and everything.
-Jay Abraham
1. What is greatness supposed to look like? Describe what a picture of your greatness
looks like for YOU:
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How will you get to YOUR greatness? What path do you need to take?
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2. Are you giving yourself enough permission to start walking down the path to your
greatness in as many different categories as you can pursue? How will you
implement what you have learned to get started on this path?
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Do YOU have a mentor or someone supporting and guiding you 100% of the way to
stay on your path to greatness? Who is your mentor? List more positive influences and
mentors that will help you stay on YOUR path to greatness:
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3. List the ways YOU add value to everyone you encounter on a daily basis. Also, list
NEW ways can you add value and how will you do this based on what you have
learned so far:
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Our Focus
• Hidden Assets
• Overlooked Opportunities
• Underperforming Activities
• Undervalued Relationships
• Underutilized Distribution Channels

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• Untapped Selling Systems
• Little Known Marketing Approaches
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14 Mindset Pillars
1.) People setting and achieving their own lofty goals and living their
dreams
2.) Everyone I studied learned how to easily and effectively overcome

obstacles
3.) Turning negatives into positives
4.) Persistence
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5.) Ethics
6.) Belief and commitment
7.) Focus and Unstoppable Drive
8.) Risk Taking
9.) Fearlessness
10.) Learning From Others’ Mistakes
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11.) Daily Motivation
12.) Handling Your Newfound Success
13.) Giving Back
14.) “Success-ion”
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The Seven Sciences Of Masterful Marketing
1.) Hidden Assets
2.) Overlooked Opportunities
3.) Underperforming Activities
4.) Undervalued Relationships
5.) Underutilized Distribution Channels
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6.) Untapped Selling Systems
7.) Little-Known Marketing Approaches
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The Items We Will Be Leveraging And Maximizing For
You Include:
• Ads You Run
• Promotions You Do
• Sales Efforts You Make
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• Marketing Activities You Use
• Yellow Pages You Run
• Direct Mail / Sales Letters / Mail Drops
• Website / E-mail / Search Engines
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• PR
• Catalog / Brochure
• Seminars / Tradeshows
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• Sales Force
• Endorsers
• Referrals / Word of Mouth
• Brand Repositioning
• Distribution Channels
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• Selling Systems
• Prospecting
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EXERCISE Questions on Assets and Available Resources:
Assets and Resources Inventory
A.) Skills and abilities available - my own and those of my team members.
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B.) Skills and abilities we are weak in:
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Financial Strength
A.) Current financial picture, available capital:
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B.) Financial gage/ talent gage:
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Other Assets
A.) Sales force, strategic relationships
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B.) Perform areas of weakness
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_______________________________________________________________________________________
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Available Resources
Equipment, space, underutilized skilled labor. Distribution, technology, internal property, marketing,
etc.
_______________________________________________________________________________________
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What is my primary marketing approach? (My Diving Board) What approaches do my competitors
use?
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Secondary marketing approaches? Do I have sub-market activities?
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Where do my prospects come from? Sources, in sourcing, generic, media, selling appeal?
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What is my conversion rate? Jay to explain.
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Over what period of time is my initial sales cycle, the reproduction process?
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What is my average unit of sales/by product/by category?
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What is the average frequency of clients' transactions? Arranged by product, by category or by

segment.
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What's my Unique Selling Proposition (USP)? Preeminent positioning.
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How to Save Advertising Dollars by Negotiating Per-inquiry, Performance-Based Deals with

Media/Websites/Marketing Partners
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Getting Vendors and Suppliers to Help Pay for Marketing. What could they provide? How Would
You Collaborate With?
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Creating a Competitive Atmosphere: What is Your Vision for the Future (Destiny Path)?
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_______________________________________________________________________________________
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How to Get Vendors to Supply All the Different Kinds of Selling/Marketing/Revenue Components You
Need...Even If They Don't Normally Stock All of Them
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Other ways to use vendors
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How You Can Profit From Other Related/Parallel Business Relationships...Even Competitors
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How You Can Profit from Professional-Relationships
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Nine Business Drivers
There are only nine things that ultimately “drive” revenue. Here they are.
Understanding strategy versus tactics and how to “get clients,” will prepare you
to think more thoroughly through how you ultimately improve each of these
drivers.
1. Ideology - Business belief systems about why I am in business.

Philosophies about succeeding: what I think or believe about different
aspects of business in general and my business specifically.
Current
Improved
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2. Products and/or Services Current - Describe and Pricing. How to improve,
add new, or take on affiliates. Include proprietary and licensed/joint
ventures.
Add new products Add new markets
Acquire new businesses
Joint Ventures Affiliate Programs
$ $$
Current
Improved
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3. Your Business Model - How to make it better:
• Lead/Prospect Generation (follow-up: e-mail, letter, call)

• Encyclopedia
• Tony Robbins
• One Shot
• Endorsement
• Self-liquidating Front-End, Higher Ticket Back-End
• Preview/Lecture/Seminar – Educate First, Sell At The End
• Teleconference Calls/Classes
• Continuity
• Newsletter/Back-End
• E-zine/E-mail List
• Paid Event, Sell Higher Ticket At The End
Current
Improved
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4. Strategy
Current

121B Ideas for Improvement
430
5. Asset Inventory - Both Tangible and Intangible
A. Capital¾Intellectual, Human, Financial (list what you have, list

ways you can improve, expand or better utilize each area).
Current
Improved
431
6. Relationships - Strategic, Vendor, Collegial, Clients, Industry, Key
Influencers, Associates, Experts. List each and THINK through how to get
more out of each area.
Current - Whether Fully
Leveraged or Not
Improved
7. Lead Generation / Marketing
Current Activities
432
Areas for Improvement
123B My Prospecting Pillars
Lead Generation
433
8. Distribution Channels and Markets/Niches You Address. List current
vehicles; then how you can expand markets and improve the segments
served.
Current
Improved
124B My Sales Pillars
Revenue Generation
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9. Procedures/Processes
Deming 101
What are the key processes currently driving my revenue and how do they perform both
transactional in a timeline-denominated basis and measurably in a quantifiable basis?
Meaning…taking sales as an example: You may have one person who is very good at
getting new clients, but terrible at keeping them. Then you have another person who
keeps them forever, but has a terrible time getting in the door. Each of those situations
offers a “process” that can be defined, examined and then improved and duplicated. But
first you have to study them.
You may also have marketing efforts that work better at some stages than others. You may also
have delivery issues (for your product or service) that can be broken down, examined and
improved. This is your opportunity to work ON your business… to look at each of these areas and
look for incremental gains. For each area, we suggest a “workshop” with your crew in which you
use everyone’s brain power to improve. So list each aspect of the functions of your company
below and then the current levels of performance/results, and then; either what you can do to
improve them, or at the very least, define the title of the workshop you will have, i.e.; “Do
workshop with crew on improving our shipping department.” Or, “Do workshop with sales team
to improve our closing ratio and test closing.” Or “Do workshop with crew to improve our
rapport skills. Or, “Do workshop with technology team to streamline our information flow.”
What topics and/or processes will set you apart as the “preeminent” and “trusted advisor” for
your clientele? Incorporate these critical areas into both personal and team training.
Current training in place, current management structure, current selling systems, and current
referral systems. List current and ways to improve. Include revenue generating and operational.
Current Improved
128B Training
Management
Selling Systems
Referral System
435
The Nine Skills Of Marketing Greatness
1.) Advertising/Direct Marketing/Copywriting
2.) Selling
3.) Lead Generating/Targeting
4.) Offering
5.) Upsell
436
6.) Resell
7.) Cross-sell
8.) Repurpose
9.) Referral
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Business Rules To Grow By
1) Don’t say I, me mine, us we or our. Do say: YOU or your.
2) Do put the reader benefit in the headline—don’t save the best for last.
3) Don’t run institutional ads—you must ask for an immediate response.
4) Clearly state your Unique Selling Proposition (USP), preferably in the headline. But
understand the difference between a headline and your USP.
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5) Use the magic word: FREE—but don’t use a conditional FREE unless it’s absolutely
necessary.
6) Don’t sell more than once products at a time (unless you have a catalog).
7) Have a call to action—request that the response (phone, mail, etc.) be done today.
22B 8) Include a guarantee.
23B 9) Don’t print in reverse (white letters with a colored background).
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24B 10) Don’t print in ALL CAPITAL LETTERS.
25B 11) Don’t use humor, don’t be cute, don’t be clever, don’t use double
entendres.
26B 12) Don’t use sans serif type.
27B 13) Don’t run type on dark backgrounds.
28B 14) Use personalization in your correspondence wherever possible.
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29B 15) Specify right hand page, outside column, as close up front as possible when
buying space in a newspaper or magazine (but don’t ever pay a premium for
position).
30B 16) Do promote to your previous customers, again and again.
31B 17) Do offer credit.
18) Convert your “subscription” offer to a membership offer—it will renew

32B
10% better.
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33B 19) Use department store pricing ($9.95 vs. $10.00) except for membership
offers.
34B 20) Make your special offer believable—otherwise it will not succeed.
35B 21) Offer installment payments.
36B 22) Add additional elements to your mailing package even though it adds cost.
37B 23) Use long copy.
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443
38B 24) Repeat your entire offer in a brochure, as well as the letter.
39B 25) Pay attention to your mailing lists—they are the most important element in
your mailing campaign.
40B 26) Do make your letters look and feel like letters.
41B 27) Use special offers to your customer list.
42B 28) Re-mail profitable lists.
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43B 29) Use short words, short sentences, short paragraphs.
30) Indent your paragraphs.
44B 31) Do underline important phrases and words.
45B 32) Don’t ever write a letter without a P.S.
46B 33) Every photograph should have a caption.
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How to Stimulate Innovation
How do you come up with good or great ideas?
Ideas are the final result of a long series of unseen idea building processes
going on beneath the surface of the conscious mind.
These processes can be identified. Then you can consciously follow the
orderly flow. In short - there is a formula to it all. A simple formula.
The production of ideas is just as definite a process as the production of cars

on an assembly line.
The formula is simple to state, but requires the hardest kind of intellectual
work to follow, so that not all who accept it use it.
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Training the Mind:
We have a natural capacity for creating ideas.
Here's how we develop it.
Bits of knowledge are nothing but rapidly aging facts.
Principles and methods are everything.
Combining old elements in new ways.
Two key principles:

1. An idea is nothing more than a new combination of old element.
2. Your capacity to bring old elements into new combinations depends largely
on your ability to see relationships.
Ø To some, each fact is a separate bit of information. To others, it is a link in a

chain of knowledge.
Ø It's not so much a fact as it is an illustration of a general law.
Ø Minds quick to see relationships come up with several good to great ideas
for each problem and challenge they face.
Ø Once you grasp a general principle, it quickly leads you to new applications,
combinations — and the result is a fresh idea.
Ø Ideas are new combinations. The ability to make new

combinations is heightened by the ability to see.
Ø Whenever an idea is produced, consciously or unconsciously, a technique is

followed.
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The Five Steps:
1.) Gather raw material. Don't look to heaven for inspiration. Work
systematically.
Two kinds of materials: 1.) Specific 2.) General
2.) Gestating, masticating. Hard to describe…It’s done in your head.
Synthesis occurs.
3.) Forget about it for a while. Put the challenge out of your mind. Turn it over
to subconscious mind.
4.) Out of nowhere the idea will appear, usually when you are least thinking
about it. Write it down - make it your prisoner forever.
5.) Finalizing, cold gray sobriety of morning, submit it for review. Good ideas
will expand.
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Twenty Five Entrepreneur Musts
by James R. Cook
1) You must develop the ability to see the needs and wants of others.
2) You must find a market gap.
3) You must become a service and quality fanatic.
4) You must get started.
5) You must offer your original investors the chance to profit in a big way.
6) You must start small.
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7) You must use the telephone constantly for acquiring all kinds of information.
47B 8) You must hire the best people and generate entrepreneurial excitement.
48B 9) You must charge enough, meet problems head on, and collect your money up
front.
49B 10) You must develop a strategy that helps your customers grow, improve, or
profit.
50B 11) You must aim constantly to become the dominant company in your industry.
12) You must maintain honesty and integrity always—and in all dealings.
51B 13) You must accept no freebies, government grants or subsidized loans.
52B 14) You must charge enough, meet problems head on, and collect your money up
front.
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53B 15) You must see your company as national, rather than local or regional.
54B 16) You must develop tenacity and perseverance to survive days and nights of
anxiety.
55B 17) You must manage your company for constant mistake avoidance.
56B 18) You must win your customers back again and again.
57B 19) You must apply a fail-safe range of management checkpoints and controls.
58B 20) You must establish a corporate philosophy that stresses quality and service.
59B 21) You must develop an error-free reporting system.
60B 22) You must constantly seek to pay minimum taxes, but always stay within the
law.
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61B 23) You must diversify into those areas that fit and supplement your existing
business.
62B 24) You must find something worthwhile to do with the money you earn.
63B 25) You must sell your company or service only when you are no longer excited
about what you do.
452
Going From Good To Great To Beyond
A great organization would be one that has sustainable impact on all.
People are constantly growing and improving their skills, their knowledge base, and
their capacities to become even greater in the future.
You’ve got to want to see everybody grow.
At Entrepreneur of the Year awards, those who win are consistently those that win as a
team. Every person’s strength get to be made productive, and their weaknesses made
irrelevant through the strength of another person on the team.
It’s critical that any sized business leverage itself through other people’s efforts, perspectives
and intellectual capital.
The great organization that are making the breakthroughs today utilize a high level of
interdependency, empowerment and team building.
453
Make sure that you surround yourself with people who think differently, who challenge you
so that you can get the spirit of synergy in producing a strategic plan.
Get people very involved in the development of your strategic plan so they
64B
have a clear sense of your most important goals and values.
65B Tap into as much wisdom as possible.
Get good data and research on your value proposition to make sure that you really
66B
have a product or a service that has tremendous appeal to people.
Great leaders decide what their mission and values are in the context of a larger vision.
67B Invest in people and in the building of high-trust relationships.
68B Get invested in the growth and development of people.
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Strive for a balanced lifestyle.
Set up empowerment agreement with people.
Focusing on the 20% of the key activities that produce 80% of the results.
Humility combined with professional will.
Advice to make a business owner’s time more productive.
Write a personal mission statement.
69B Think through each of the important roles of your life.
455
Never think in terms of a day, but rather, in the larger context of long term
125B
thinking—over a year or a quarter.
Empathic listening, hearing and acknowledgment.
70B Ask four questions of yourself… What is it I really am good at?
71B What is it I really love to do?
What need can I serve?
What is life asking of me? (This is listening to your conscience.)
Reevaluating the direction of the rest of your life is probably one of the most strategic things
you could do.
456
Over 90% of new businesses don’t make it to the second year, some because of operations,
but most got seduced by their own enthusiasm.
Principles that are universal and immutable for all of us: fairness—for the heart: kindness
and respect; for the mind: developing and using talent; for the spirit: meaning and integrity.
Peace of conscience means you’re true to your promises, to your vows.
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Force Multiplier Effect
Force Multiplier Effect is a military term I’m going to define.
It’s a capability that, when added to and employed by a combat force,

significantly increases the combat potential of that force and thus enhances the
probability of successful mission accomplishments. It’s the militaristic discipline of
creating multiple avenues of penetration at the same time. Going by land, going
by sea, frontal attack, side attack, surprise attack, missiles, going ahead to
penetrate and soften the market, air attack, land attack, sea attack, stealth attack.
And it’s a proven process of dominating your enemy in military terms. It’s a
proven process of dominating and preeminently owning your market in
commercial, in entrepreneurial, in business terms, and it all ties together. It’s
letting the full force of lots of different factors carry you to greatness without you
having to lug it and push it.
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The Power Parthenon Strategy
Of Geometric Business Growth
28 Universal Strategies To Build

Your Power Parthenon
Increasing Your Lead Generation Through:
• Referral systems
• Acquiring clients at breakeven up front and make a profit on the back end
• Guaranteeing purchases through risk reversal
• Host-beneficiary relationships
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• Advertising
• Using direct mail
• Using telemarketing
• Running special events or information nights
• Acquiring qualified lists
• Develop a Unique Selling Proposition
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• Increasing the perceived value of your product/service through better
client education
• Using public relations
Increasing Your Client Retention Rate By:
• Delivering higher-than-expected levels of service
• Communicating frequently with your clients to nurture them
Increasing Your Conversion From Inquiry To Sale By:
• Increasing sales skills levels of your staff
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• Acquiring clients at breakeven up front and make a profit on the back end
• Guaranteeing purchases through risk reversal
• Host-beneficiary relationships
• Advertising
To Increase the Average Transaction Value, You Can Focus On:
• Improving your teams’ selling techniques to up-sell and cross-sell
• Using point-of-sale promotions
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• Packaging complementary products and services together
• Increasing your pricing and hence your margins
• Changing the profile of your products or services to be more “up market”
• Offering greater/larger units of purchase
To Increase Transaction Frequency, You Can Focus On:
• Developing a back end of products that you can go back to your clients with
• Communicating personally with your clients (by telephone, letter) to

maintain a positive relationship
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• Endorsing other people’s products to your list
• Running special events such as “closed door sales,” limited pre-release and
so on
• Programming clients
• Price inducements for frequency
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Up-Selling, Cross-Selling, Follow Up-Selling, To Multiply
The Profit From Each Transaction
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9 Major Benefits of a Strategic Alliance:
1. You can use it to achieve advantages of scale, scope, or speed. You can take advantage of
other people’s infrastructure. You can take advantage of other people’s reach. You can take
advantage of other people’s responsiveness that you, as a single proprietor, one-man or -
woman band, that a small business couldn’t do. You can plug into all this intellectual capital… all
this reach. It’s just really incredible. List 5 ways you can achieve this:
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2. You can increase market penetration. You can do it locally. You can do it regionally. You can
do it nationally. You can do it internationally. You can do it all kinds of different ways. List 3
ways you will do this:
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3. You can enhance your competitiveness in local, national and international markets because
now you’re in association with somebody who’s a dominant force… somebody who’s already
built a market… somebody who they already trust. List who this could be for you:
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4. You can enhance product development. You don’t have to sit there and try to develop new
products yourself. You don’t have to try to allocate an unavailable portion of your meager
profits to try to come up with breakthroughs for the future. Now you can just go out and find
other people who have already done it and don’t know what to do with it. You can put it
through your distribution. You can get control out of it. You can put your products through
theirs. You’ve got all this flexibility. It’s like a two-way valve. List how you will put this into
action:
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5. You can develop new business opportunities through products and services. As I said, it’s a
two-way valve. You can take your product through as many different other distributions
channels as you like --- publications, non-competitive complementary providers of products or
services, people outside your market, new applications of your product… You can even go
through competitive ones. I did that all the time. List the distribution channels available to you:
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6. You can create new businesses at will by understanding that you’re not limited to just your own
company product. You can go out, and you can take the elements of what I hope to teach you,
and you can get control of other people’s distribution. You can get control of other people’s
products. You can match people together in the middle. You can create businesses at will.What
are the first steps you will take?
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7. You can get control of tangible and intangible assets. We had a person who realized that
certain companies that had big telephone sales rooms sold consumers. Other ones sold
business to business. People that sold business to business are marketing during the day.
People that sell to consumers are normally marketing from 3:00 until whatever the hours are.
He was able to find business to business rooms that had invested millions of dollars and were
empty after 3:00, and lease on a performance --- not on a cash basis, but on a share of the
revenue. The facilities for a consumer --- he was able to go to consumer sales people who
wanted to leave their employer and start their own. He was able to get equity in their business
and a share of the revenue just for being able to make this money connection. What ideas does
this give you?
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You can use strategic alliances and joint ventures to reduce costs. There are a lot of things that
you can’t afford to do, but if you joint venture them and you only pay for them in direct proportion
to the revenue that comes in, they’re no longer a cost. They’re an income stream. They’re a profit
center. They’re totally transformed.
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43 additional factors about Strategic Alliances and Joint Ventures in relation to
Relational Capital:
1. Strategic alliances and joint ventures, once you understand the dynamics and mechanics, are
easily established. List the easiest companies, media organizations you could start with:
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2. They only add to your own selling efforts. All you have to do is figure what you do, and then
figure what you don’t do and you want to do, and who already has access to that, and it’s like a
playground. Who has access you don’t – or stronger market trust/credentials?
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3. It increases your sales massively, and thus your profitability. If right now you’re only operating
in a linear, single or few marketing activity or market areas, and you’re making a living but
through joint ventures, strategic alliances/endorsement, host/beneficiary deals you could open
up twenty new distribution channels… eight new markets… that could increase by a function of
five, ten, twenty times the business. And if you can’t handle it, you can joint venture with
somebody who’s got capacity and doesn’t have sales. There’s no problem… there’s no need…
there’s no asset… there’s no skill set… there’s no issue in this whole process that you could
imagine you want that you can’t get through creativity.
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4. It lowers the barrier of entry.For example:Let’s say you wanted to reach the legal market, and
you’ve never done it. Well, you can call cold attorneys. Or, you can find a company selling
products or services or advice to attorneys that are not at all competitive, but have worked for
the last 20 years building an access, building a reputation. Go to them and make a deal where
they put your offer through their distribution. Either their people take it, or you do it for them
through letters or salespeople. What markets aren’t you in that you’d love to penetrate? Who
does that market/niche already trust?
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5. The next additional factor: It boosts your market presence. You can do joint ventures with tons
of different organizations, entities, distribution. Even if they don’t all make you a lot of money,
they hit the market with credibility and implied or expressed endorsement, and it makes
whatever you do more powerful. You envelope the market.
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6. It provides added value to customers.Example: a health club... that realized that if they gave
certain kinds of retailers certificates good, not for a free lesson, but for like, six months, which
was worth $500, it had very high perceived value. So the retailer could say, “I’ll give you a $500
membership if you spend $200 with me.” The retailer loved it, because they charged nothing.
Every four people that came and redeemed it would extend to a $2,000 member, so they were
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able to really do that so you could add value to somebody while creating an incredible back end
for you. List all the added value products or services that could differentiate/distinguish your
business:
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7. It contributes substantially to perceived customer or client benefits. Again, you give somebody
something worth $50. You’ve got incredible ability. You can give an endorser or a host, a
partner, a product, a sample, an experience that has perceived value. It may make them a hero,
but it sets up your buying for the back end.
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8. You can enter emerging markets instantly. Let’s say there’s a market that you want to be on the
cutting edge, and you don’t know anything about it, but you want to be the leader. All you’ve got
to do is figure out who already has presence in that market --- not necessarily cutting edge. What
emerging markets do you most want to enter? Who already commands dominance/respect of
that market?
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9. It expands your horizons. When you realize the limitless array of ways, places you can go with
this, and that if you don’t have infrastructure, you don’t have capital… It’s OK. You know why?
Because you can access it on other joint ventures. Whatever you need, as long as you can show
people that they’ll get something great out of it, you can always find somebody to provide it. You
need copywriting --- somebody will do it for a percentage. You need delivery --- somebody… All
you’ve got to do is be able to be extremely powerful, persuasive, and compelling on
communication, and one of the segments I plan on doing… List an “impossible future” (as Robert
Hargrove calls it).
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10. You get to speed your access to wide varieties of new markets. We’ve used this to take my
brand to the real estate market, to the chiropractic market, to the martial arts market… All with
me basically having little infrastructure. I used to have a big one, but I don’t need it anymore. I
can get anything I want on a performance, or a soft dollar basis. Why do I need to have a huge
overhead, an HR department? But let somebody else do that and you get the leverage off of it.
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11. You can expand beyond your geographic boundaries, right now limited to your facility, your
staff, your delivery. Use it. But now, with the blinders off, and with the permission I’m giving
you, the business world should be a 3D movie and you’ve got the only pair of glasses.
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12. You can gain a foothold in international markets. You can do anything you want. Years ago, I
taught a man --- I’m very proud of this. When infomercials were just starting out here, I used to
go to Australia and the U.K. and do seminars, and I taught a direct response guy how to go to all
the infomercial people here who were limiting their horizon to just the United States and get the
rights on a joint venture to use their infomercial to buy their products at incremental cost plus
profit, and use it in Australia, in New Zealand. He made $20 million a year, and he wouldn’t have
made a dime if he hadn’t created his own infomercial. He got access to infomercials that people
were spending $400,000 to manufacture, to create. He got access with rights that people had
spent millions of dollars to develop. All he needed to do was share, relatively speaking, and the
profit. He just had to be able to exploit that. How wide could your business grow/expand?
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13. You can control other people’s markets. Years ago, before the Internet ever developed; the way
to communicate with people was through a lot of financial or specific generic type of financial
type advisor letters, newsletters. I realized that a newsletter was the perfect vehicle to access
segments of the market. I went out and I tied up the rights to put inserts into other people’s
newsletters for no fixed cost, but for a modest share of the revenue.The first offer I made to the
first newsletter I tied up didn’t cost me a cent, because I said to them, “I’ll just use your printer to
print it, and they’ll send me a bill.” The person I did it with had 90 days deferred billing, so I got
$30,000 worth of billing for my inserts that I didn’t have to pay for 90 days. My first insert made
me $500,000. I had to pay $150- of it, give 30% back to the person who owned the rights, but
they didn’t see it. And I tied up the biggest asset they had because they didn’t see it and I did.
14. You can gain a competitive advantage. I mean, if you’ve got assets to markets and you’ve got a
direct, implied or explicit endorsement and your competitors don’t, three things happen: It
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shortens the selling cycle. It reduces the cost of access. It enhances the response rate. That
means you’re going to sell more, you’re going to sell faster, it’s going to cost you less, you’re
going to make more money --- even if you pay back a portion of that revenue to the endorser or
the joint venture partner. When you understand this concept of lifetime value, even if you pay
very generously on the first sale, but you got all the profit on the second or the subsequent one,
and if you have no other products to sell, that’s not a problem.
Let me tell you why:
We made somebody a million dollars who had no time, no understanding. We taught her how to
go out on the Internet, find people that had non-fiction --- business or skill-type of books, and
that’s all they had --- match them with people that had training, expertise, coaching in that skill,
and take half the profit on both sides. She put a few people together that way, and just by
making what I’ll call the “money connection,” she was making a million dollars a year just being in
what I’ll call the “toll position.”
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You can rapidly overpower the competition.
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You can joint market with people and share the cost.
15. Joint selling or distribution --- quickly make a point: You can do things at will. Instead of having
to buy equipment… instead of having to rent an office… instead of having to hire people..All you
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have to do is get the paperwork done on the joint venture or the strategic alliance, and you are
off and running. Then you just have to be masterful at programming, at leading, at directing.
16. You can collaborate to design new products or combinations with other people.
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17. You’ve got total flexibility in the way you operate. We normally have control of 50 different
products, services that we’re doing deals on in different forms in at least three continents, and
I’ve got eight people. And if we had to do it ourselves it would take tens of millions of dollars. It
would take staff. It would take specialists... Whatever we need, we just take this guy who wants
to be a performance-based, a joint venture, a profit-sharing partner, and then we just go through
the motions. If the first one doesn’t do it, the second one does, or third. If the first one turns us
down, always say, “Why?” And if they give you an answer that I had never thought about, I
figure out a preemptive way to overcome that on the next one.
18. It’s less risky. The downside to you… You’re in Los Angeles. You want to open an office in New
York? OK. You’ve got to hire people. You’ve got to basically lease an office. If it’s a nice one,
you’ve got a three- to five-year lease. You have to furnish it. You have to hire. You have to train
them. You have to buy the equipment. If you have a lot of money, that’s no problem. If you
don’t, that’s a problem.
What if you find somebody who is distressed, meaning they aren’t using their opportunities fully,
their relationships fully, their past clients fully… and you can make a deal with them that’s
incremental, so it’s variable-based? You could be in not just New York. You could be in Atlanta,
and New York, Sydney, Australia, Toronto… And your downside is very little. If it doesn’t work,
you unwind it or you adjust it.
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Sometimes it doesn’t work because the money isn’t good. I had a deal one time with an
infomercial company. They had done a ton of infomercials testing people where they were
splitting 50/50 on the revenue, and about half the deals didn’t work out, and they summarily
abandoned them.
I looked at them and said, “A lot of these are back-end deals,” meaning that once that company
got a buyer, they kept getting subsequent product/service revenue. And I said, “If you
restructure the deal to where you show that company that even if they made no profit and just
got their cost up front, they’ll make money on the back end.” You can make a losing deal
profitable. And we renegotiated five of the deals right away, and I made a million dollars, and he
made a multiple of that, and the companies that had basically abandoned the relationship made
a ton on the back end. It’s all a mindset, all a mindset.
19. Requires less cash.

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20. Acquire a technology license. You can license other people’s technology. One of the things I say
to people is, somebody looks at buying a franchise. And that’s good, but most franchises don’t
have the critical element, which is what I bring to you, which is marketing. I said, “Go to every
major market and look up in the Yellow Pages who’s got an independent. Find out how well
they’re doing, and go to them and ask them if you can license their systems and their approach
and their advertising for every market other than the one they’re in, because most of them aren’t
that ambitious. Now you’re in a business you can license/joint venture with all kinds of other
people and be a franchise, or not a franchise.
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21. You can get research and development done for you free. The biggest problem in most
businesses is you’ve got to keep developing innovative, breakthrough ways to make your current
model obsolete. Well, that requires technology, or commitment, or staff, or capital, or
experimentation. But guess what? In this fast world, you can go online and search any category
and find 5,000, 25,000 websites of people that have already come up with a breakthrough. The
problem is they don’t have marketing. You can get control of it, and the lion’s share of its profit,
for no out-of-pocket to you if you know how to communicate.
22. Access knowledge and expertise beyond company borders --- There are so many consultants out
there. There are a lot of excellent ones. And you really can make a difference for most
small/medium-sized business owners. Most people here, they can’t afford them. They can’t
afford them.
23. It can strengthen your expertise in an industry as result of the association. In the chiropractic
industry I did five joint ventures. I was joint ventured by three magazines. I was joint ventured
by a leading-edge technologist. I was joint ventured by the leading chiropractic company. If I
send a letter myself to chiropractors beyond the scope of that, they’d see me from five different
impact points. My credibility, my stature, my attributes, my relative worth has already been
established by plugging into the cumulative efforts, the relationships of all these other people.
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24. It extends your product offerings. Let’s say that you’re a company that has one or two products,
and nothing else will sell. Well, you can have a static, a linear adjunct to that sort of business, or
you can spend all this time and effort this opportunity costs identifying and creating goodwill to a
company or to an individual. I want to find other related complementary or extended products,
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or even more advanced or expanded versions of what I did, then sell them, and share the profits,
or vice versa. You find all kinds of other businesses… all kinds of other service providers… all
kinds of other publications or associations that have a limited number of services or products.
And when they’re done, that doesn’t have to be the end.
25. Widens your scope of innovation --- Innovation and optimization are two totally contrarian
things. Optimization is maximizing the performance, the viability, the possibility of everything
you do. Innovation is making what you do obsolete, and coming up with totally new applications,
markets… You can do both through joint ventures, and that’s very exciting.
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26. You can secure your position as front runner in your market.
27. You can provide marketing or selling, or have someone else provide marketing or selling. Let’s
say that you’ve got a killer product, but you don’t know how to market or sell. You joint venture
with somebody that does. Let’s say that you don’t know how to market or sell, but you’ve got no
products or services.
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28. You can easily establish purchasing and supply relationships. You can get access to stuff
incrementally that no one else would ever let you have access. I’m going to give you some
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examples of how you don’t have to buy things, and almost at will create buying power instantly
for yourself and for others.
29. You can set up instant distribution networks all over the--- country, industry, nation, continent,
world…
30. You can capitalize on all kinds of hidden assets and overlooked opportunities.
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31. You can make much higher ROI’s and ROE’s on alliances than from your core/main business,
because your core main business --- you’re burdened with the full overhead. When you go to a
joint venture, I’ll teach you how to make a deal where everything is incremental. You’re not
laden with their fixed overhead. You’re not laden with their payroll. You’re not laden with any of
the cost. You figure out a G&A that you pay them, but it’s incremental. It’s performance-based.
You can make three or four times as much on those transactions as you do on your own.
32. You can keep focused on your own core business while expanding, exploiting and harnessing this
whole part.
33. It lets you maximize and multiply and stretch your own management, economic, technical and
operational resources. People ask me, “Jay, what’s your theory of management?” And I say,
“Don’t manage. Do joint ventures with people that have seven tiers of management.” They have
consultants… I just plug into that, and they provide whatever I’m missing. All I have to do is be
the big thinker, and the deal-maker, and the strategist, and the visionary.
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34. You can outsource every non-core competency, and get it performing at many times higher level
of capability and results, and only pay for it in direct proportion to its results to your bottom line.
35. Reduce your overhead through shared costs and outsourcing. I mean, you’re buying all this
outside sales for a much lower cost of sales. But by outsourcing and starting it from an expensive
cost of sales, you should wish you had to pay a sales trainer $100,000 this month because of the
extra sales he taught you how to get. You should wish you had to pay a technical expert $30,000
for the savings he or she made you, because that means they made you probably $100-, or $150-,
depending on what the deal is.
36. That’s the power of joint ventures. You’re capitalizing on all that goodwill, all that existing trust,
access… And it’s incalculably powerful, and you put up very little. You can put up nothing. You
can put the profit of the sales, the cost of printing, the cost of a letter, the cost of an e-mail, the
cost of presentation… But you’re accessing millions, tens of millions, hundreds of millions of
dollars each time you do it, and it costs you nothing.
37. The first time I did a joint venture with Tony Robbins and got him to sign a letter and send it to his
list, it was 250,000 people. We tested it first to 25,000. My downside was the hard cost, $12,000.
And it wasn’t number zero. But what I was getting access to were the buyers that came from the
$100 million that Guthy-Renker spent on infomercials. What I was getting was access to the
buyers that Tony Robbins had spent eight years developing his methodology. What I was getting
access to were the buyers who had Tony’s trust, because he’d spent eight or ten days at one of his
Mastery programs with them, winning their trust. And I got that for the cost of funding a letter.
38. First thing we did to their list, fully rolled out… It cost us $300,000, and brought in $9 million. You
do the math. That was a good yield. That’s what you’re dealing with. Does it always work that
well? No. But if you choose wisely… if you understand the dynamics (and hopefully you will --- at
least you’ll understand the basics before we’re done) you’ll be able to at least break even, even on
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a bad deal, and make out like a banshee on a good one, and know the difference between the two
so you can discriminate.
39. There are lots of kinds of alliances. You can do joint ventures. You can do co-branding. You can
do a host/beneficiary. You can do equity partnerships, and equity can be in a new business you
create together, a new product you create together, a new market you penetrate together, a
distribution channel you create together, a different category of buyers you create together… I
mean, it’s only limited by your vision, and your ability to revere, respect, value and
commandeer/control of intangibility.
40. You can flip business opportunities. I used to always do joint ventures where I would get control
of somebody’s right. Then I didn’t do anything with it, but I flipped it to somebody else who
would either pay me a share for doing all the work, or a fee plus a share, or just buy it out from
me, and I’d sign it to them. And I did that all day long.
41. One time I did a promotion for a newsletter I created. I created $400,000 worth of subscribers. I
took all the money, sold the subscribers with no money in it to somebody for $100,000, sold the
rights to that person to keep accessing the joint venture for another $200,000. And I walked away
with it just with the ability to vision it and get it started.
42. Let’s say in certain markets, certain kinds of businesses run lots and lots of ads because a live-in
market saturates quickly. Once an ad stops pulling, they retire it. But that ad wasn’t seen in 95%
of the other markets. You can get control of ads that somebody spent $20-, $30-, $50,000 writing,
creating. It worked for them, and then burned out, and you could re-license it to people in the
same business outside of your market, and you can get a share of the revenue, a fee plus a share…
You can do it all the time in as many markets as your fertile little mind wants to pursue.
43. Again, you could do equities in all kinds of strategic partnerships. You could do equity in that deal.
You could do equity in the business, the clients that come from it. You could do equity in a new
brand you created together. You could do equity in the distribution channel. You can do equity in
the buyers and prospects. You can do equity in the marketing materials you create, that you can
relicense. You can do equities in the intellectual processes that come from it.
481
YOUR
CUSTOM ACTION
GAME PLAN
For Engineering
Breakthroughs and Mining
Untapped Windfalls of
Revenue & Profits
482
Expanding Your Growth Possibilities
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My Product / Service / Information
127B My Business Model
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My Unique Selling Proposition
485
My Master Marketing Strategy
486
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487
MY COMPANY’S
Actions, Activities, Opportunities
Assessment Inventory List
Here is a comprehensive identification of ALL the internal and external Relational Capital
activities, opportunities I have identified within and outside my company. I have also described
how I best see this newfound realization benefitting my business, either strategically or
economically:
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Here is a list of new sources I see where my business can develop, generate prospects; generate
specialized buyers that we haven’t had access to before:
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Here is a list of the problems I now realize I’m trying to solve for, from, with my business and
the issues I’ve been struggling with, plus opportunities I’ve never previously recognized I can
now solve using Relational Capital:
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Here is a list of all the companies, organizations, influences, media and complimentary-type
entities that have direct access and trust of the market(s) I target and want, can represent new
market segments/sources, too!
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488
Here is a list of all the ways I realize that my marketing, advertising, sales efforts, sales people,
product/service, brand or company can be made more favorable, advantageous in the eyes of
my market:
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Here is a comprehensive list of everything I can identify on the revenue side, operational side,
logistics side, proficiency side, positioning/access side, product/service side, distribution side,
support/personnel side – that’s restricting/limiting/constraining my growth, sales, success:
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Here is a written verbalization of the single, biggest positive business realization I’ve gained
from this program about my business that relational capital can meaningfully impact. Also, I’ve
written down the most important action or implementation lessons I’ve learned this week, too.
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Here are the ten things I most want to do, using relational capital and a one-sentence
explanation of why I want to do each one:
1.____________________________________________________________________________
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2.____________________________________________________________________________
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3.____________________________________________________________________________
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4.____________________________________________________________________________
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5.____________________________________________________________________________
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6.____________________________________________________________________________
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7.____________________________________________________________________________
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8.____________________________________________________________________________
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9.____________________________________________________________________________
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10.___________________________________________________________________________
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Here is a list of all the actions and activities my business is doing that I (now realize) cannot
produce maximum results, performance WITHOUT some form of factor added to what we do
and a one-sentence explanation of why I believe this to be true:
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Here is a list of advantages, benefits my competitors have over my business/product/service

and what I’d need to have resource-wise or do, action-wise, to be superior:
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Here is a list of resources, assets and access I’d like to gain control of for my business, along
with a one-sentence explanation of why/what I believe gaining that access/asset will do
favorably for my business:
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490
Go through the twelve symptoms of business underperformance. List all the areas your
company is sub-optimal at being/doing right now:
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List all the business growth options you’ve already tried, along with a candid assessment of
how those endeavors did, have and are performing for you. Then list how either doing it again
or adding relational capital leverage to it would/could make a positive difference:
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List as many other people’s/organizations/resources you would like to gain access to and
why/what you think gaining access would mean to your business:
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Who has a weaker business (but a good reputation) that you might be able to acquire on
performance-based earnings:
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List all the negatives in continuing to operate your business – without using leveraging
techniques:
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Who has a sales force you could joint venture with?

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List all you know about them:

491
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Who has offices/factory/facilities you could joint venture with? List them:
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What media – online/offline – print and electric – could be a perfect marketing partner for
you?
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What would you promote if you had them as partners? How would you compensate them?
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What does/would your business need to do, have differently to have extraordinary marketplace
presence?
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Who could you recruit as your public Board of Advisors?
Industry ___________________________
Retired ____________________________
Generic ____________________________
Author _____________________________
Celebrity ___________________________
How would you compensate them? ______________________________________________
What is your business worth today? How would you double it tomorrow? Triple its value?
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If you had unlimited capital/checkbook, what, who, why would you spend it on your business?
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Do the math
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How could you use other people’s money to finance your company’s growth? I.e., sales force,
ads, call center, distribution, and other offices.
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Look at the 7 forms of OP. List ways your business can mine at least three opportunities in each
category:
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What can you reclaim/redeploy/repurpose that other organizations no longer value? I.e. leads,
one-time sales, articles/contacts, etc.?
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What companies do you know of in your industry that have gone out of business recently (or
are close to going out) – do they have assets you can leverage?
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Who has a facility/static or mobile market access you could leverage? Think sales/kiosks
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Who has communication vehicles – subscribers, webinar, website, journal, podcasts you could
leverage off of?
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What obvious non-competitive industries could help you – think groceries/Starbucks, Subway,
banks?
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Who could give you instant and expansive credibility (Rockefeller, Bernard Baruch?)
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Who/what activities could your product/service tie into? Movie tie-ins/fundraising/charity:
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Who has leads/prospects you could re-acquire or co-work, package or reinvigorate – think
home improvement:
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Who could you co-brand with?
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Who/what brand, skills, product/service, process could you license from others for your
business?
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What core competence is your company weakest at and who is strongest

within/outside/related to your business that’s not directly competitive?
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Make a list of all the equity partnerships your business could structure (see me for template):
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Who has a sales force you could use to market your products/service to THEIR audience?
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What new products/service would be best to add to your current sales offering? Think first
purchase or back end…Who/what kind of organization already has that or could create it/them
for you?
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What distribution channels that reach target partners are you NOT in? Who what kinds of
organization have developed these channels well?
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How many success stories of clients/buyers do you have now? How would you start collecting,
progressing more success stories to come in?
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Where could you achieve equity in exchange for intellectual property?
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Who could create new products with you together, rewards, sales forces, database/lists,
facilities, information – shared resources? Mastermind trust. Financing (crowdfunding).
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What assets, access, resources, and products – do you possess that you can leverage outside
your company? Who’s best benefit?
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What questions, issues, procedures do I need to understand in order to make everything on my

list become a financial/success reality? How many of these issues do I need help better
understanding/mastering?
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What niches could I target that my competitors don’t readily see go after (see internal
assessment)? How would I do it, who already had access to that segment?
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What else does your business need that you haven’t identified/listed?
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Who has access to that/those assets/resources?
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Whose brand would most powerfully benefit your company, product/service if you accessed it?
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Make a list of all the adverse situations any organization could be experiencing that would
represent an opportunity for your company? Also, identify what each opportunity would be:
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How many ways could you use your brand for other organizations?
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How else could you use your marketing/selling distribution?
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List all the internal assets, access, resources, processes, proficiencies you could leverage out to
other organizations. Describe also what access to those resources could mean to those
organizations.
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What new products could be created by you, acquired by your, adapted/adopted by you (See
“flip.” See rollover deals, fiber-optics, etc.)
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What new markets could/would your product/service benefit that you aren’t reaching now?
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What alternative product service solution does the market have to choose from?
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What are the organizations offering those alternatives solutions?
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Can you leverage either way those organizations buyers, distributors either up/down?
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List of types of Alliances – Idea Jogger:
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Who has what you need (list)?
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What do YOU possess?
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Expanding your possibilities:
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SUPER QUESTIONS
What are YOUR Strategic Objectives?
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1. Start with the “big picture.” What key components are necessary to drive it?
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2. Where are they going to come from, why is it necessary, and what are your alternatives
and options?
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3. Explain how you will vastly expand your markets, products, distribution, sales
representation & create a cost effective impact:
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4. How will you gain valuable or strategic assets, access, resources or talent from the
following items:
Implementing Alliances & Acquisitions

(Inventory & Opportunity Audit)
Products/Services
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Distribution Channels
Sales Personnel
Sales Methodology
Technology
Facilities & Equipment
Underutilization
IT & Technical Abilities
Brand
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Equity in deal
Equity in client
Equity in brand
Equity in distribution channel
Equity in buyers and prospects
Equity in marketing material
Equity in process and intellectual property
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ENDORSEMENTS
List the ways you can obtain endorsements (Example: Seminar company getting attendee
endorsements, Association uses local paper for distribution of charity fund and get multiple
write-ups and endorsements, Magazine subscriptions / Schools, etc.):
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REINVENTING BUSINESS OPPORTUNITIES
How can you use what you have learned at this Super Seminar to reinvent business
opportunities? Use the following items to explain: brand / actual products / services /
proprietary products / lists / research / sales force / too much capacity / facilities/ processes:
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How can you reinvent business opportunities using the following items?
Mastermind/Brain Trust
• Profiteering
• Financing
§ Promotions
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§ Sales force
§ Ads
§ Markets
Product Lines
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How can you obtain endorsements to reinvent business opportunities using the following
items?
Distressed Properties
• Jobs
• Lists
• Space
• Production
• Talent
• Distribution
• Delivery
• Capacity
• Facilities
• Technology
• Procedures
• Intellectual Capital
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______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
ACQUIRING
Use the items below to explain how you will acquire distribution networks:
• Sales Force
• Retail Stores
• Kiosks
• Signage
• Leases
• Licenses
• Display Window
• Inserts
• Polywrap
• Bind in
• Blow in
_____________________________________________________________________________________
_____________________________________________________________________________________
_____________________________________________________________________________________
Assets
• Lease
• Purchase
• Option
Acquire Leads
• Unconverted Prospects
504
Inactive Clients
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
LICENSE OR ACQUIRED LICENSEE
How can you acquire or render expertise using the following items?
1) Marketing
2) Sales
3) Management
4) Cash Flow
5) Organization
6) Performance Enhancement
7) Information Technology
8) Advisory Board
_____________________________________________________________________________________
_____________________________________________________________________________________
_____________________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
505
Two Way
1) Brand Name
2) Technology /Methodology
3) Promotion / Marketing Expert Systems
4) Products / Services - Private Label
5) Processes
6) Image / Design / Facsimile
7) Territory / Market / Industry
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
CORE COMPETENCY CONSULTING
How will you use the following 4 items to attract or render world class expertise on a
performance compensation basis?
1. Core
2. Critical
3. Dual
4. Many different ways to structure
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
506
NEW PRODUCTS MARKETS
One of the BEST ways to rapid growth is to open / develop / create new products or markets.
How will you take over, re-purpose, package together other company’s product and / or
services? Acquire Sales Distribution? Re-purpose your produces to new markets? Identify
players in new markets you can joint venture / partner with:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
eBUSINESS
Who has the internet/e-mail expertise, affiliate software, infrastructure, e-mail lists, IT staff,
equipment, data software, etc., you need or want access to?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
507
WHAT ARE YOUR STRATEGIC OBJECTIVES?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
How will you acquire or access the good will, trust, credibility of older, larger more respected
entity, organization, publication, selling force or individual?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
How will you gain more upside leverage?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
How will you more optimally deploy someone else’s assets?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
List the ways you can find opportunity in someone else’s adversity:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
508
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
List the ways you could leverage off something valuable someone else invested, tens, hundreds
of thousands, millions or even tens of millions to create, acquire or develop:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
HOW POWERFUL IS ONES BRAND?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
How will you prove that the more powerful your brand, the more profitable the strategic
alliance:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
509
What else can you do with your brand?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Who else’s brand can you deploy or ethically exploit?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
How many different ways can you do it? This goes both ways.
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
IMPLEMENTING ALLIANCES AND ACQUISITIONS (INVENTORY AND OPPORTUNITY AUDIT)
What do you possess? Example: Products / services, Distribution channels, Sales personnel,
Sales methodology, Technology (software/hardware systems), Other productive
processes/methodology, Facilities & equipment, Underutilization, Intellectual property /
Technical abilities:
510
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What brand do you possess? Good will, trust with specific groups, markets, media, core
competencies, affinity?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
EXPANDING YOUR GROWTH POSSIBILITIES
• Who are the people / businesses I want to reach?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What other products, services and options do people typically purchase prior to buying or using
your type product / service? Who provides those product / services?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
511
What products / services, etc., do people typically need and / or acquire along with or in order
to optimally use your product or service? Who provides those product / services?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What events, activities or changes typically occur to cause someone to want or need your
various products / services?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What other products / services does the key decision maker I am targeting also buy? Who
provides those product / services?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What assets do I need that I do not have?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
512
What periodicals /advisory materials are used by the market I want to reach? Who provides
those product / services?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What problem or opportunity do your products / services solve for your prospect / client?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
• What other type of business, organization, profession etc., has more to gain than even
you do by seeing you either acquire a client, or sell a specific product, service or
combination? And why?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What other market or industry could use / benefit from my product, selling system or
methodologies?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
513
What is the MNW of my client / prospect worth to someone else?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
• What are your highest margin products or services?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What are your highest repeat purchase products or services?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
• What logical products can be created by you, acquired by you, can be adapted /
adopted?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
• What markets could your products or services also apply or translate to?
514
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What related fields could you penetrate?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What parallel universes are most similar to yours?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What other business markets, products or services have you been thinking about?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
How will you look for additional alliances, markets? How will you take on their products or
services, provide services, functions, share personnel facilities, sell equity or buy equity, and
develop a referral/alliance feeder program?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
515
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
FINDING THE CORRECT PARTNER
Who else (generic type entities & individuals) has direct access to the markets, influences,
individuals, companies, media, distribution channels, prospects, research & data, technology or
methodology you want or need?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What are the strengths and weaknesses of target organizations, prime assets, attitude, key
important point of impact / interest (i.e., money), purpose, reclamation?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
The best partner will have what you don’t have – strong where you are weak, etc. Match your
company’s capabilities with people who share your objectives. Look for companies to partner
with who are one step ahead of their competitors. Large companies can make good partners.
How will you implement these steps?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Who has a sales force I can tap into?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
516
______________________________________________________________________________
______________________________________________________________________________
Who sells to the same demographic profile I want to reach?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Who has the trust, respect, and good will with my prospective market?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Who has authored a book that’s respected in my field?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Who is not a direct competitor?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Why, when and how should an alliance with suppliers be considered?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
517
COMPETITOR PARTNERSHIPS
Fully 50% of alliances today are between competitors. Examples: Coke and Pringles
(distribution in specific markets), Ford and Nissan (minivan design and manufacturing), Phillips
and Sony (optical discs), HP and Cannon (laser printer markets).
What could competitors offer to your market that you can’t?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Who are the industry gurus my market follows?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Who are weaker but quality competitors?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
List your possible risks / partial fears:
Explicit:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Implicit:
______________________________________________________________________________
______________________________________________________________________________
518
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
How you actually verbally, transactionally relieve / mitigate them?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
OPTIMIZATION
How many other ways can you help other people optimize their sales, reclamation, utilization,
service, value, etc.?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
21 Mind Expanders. How many might apply to you and your business?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What’s my best option/opportunity/approach for achieving advantages of scale, scope, and

speed?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What three approaches could I take to increase my product/service company’s market

penetration?
519
1.____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
2.____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
3.____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What’s the one biggest action I could take to enhance our competitiveness either locally,
regionally, nationally or in international markets?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What’s the easiest/best way to enhance my future product development?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What are three appealing ways to develop new business opportunities/new products/services?
1.____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
2.____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
3.____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What’s the safest/best way my company could diversify (can be market-based, product-based,
niche-based, etc.)?
520
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Can we create an entirely new business or businesses using Relational Capital? If so, what
might it/they be?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
What are the five most immediate ways I can reduce our fixed expenses costs?
1.____________________________________________________________________________
2.____________________________________________________________________________
3.____________________________________________________________________________
4.____________________________________________________________________________
5.____________________________________________________________________________
______________________________________________________________________________
What’s the easiest, single activity we could establish first? Why?
_____________________________________________________________________________
What are the best strategic Relational Capital ways to augment our selling efforts (JV, sales
forces, and media?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
How would the activities on this list increase sales and multiply profitability for our company?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
What markets/scope could we best lower the barricade of entry to? How? Why is that market
desirable (to us)?
521
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
How much of an expansion would these approaches give to our client/buyer base? What
advantages of scale, critical mass, would/could result? Why?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What are the three most stunning ways we can boost our market presence using Relational
Capital?
1.____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
2.____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
3.____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What would the biggest added value/perceived benefit we could make to the client
perception? Why?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What’s my newfound vision for the business now – if I commit to maximizing leverage?
Size
Number of client base
Scope
522
Prestige
Selling/marketing approaches
Markets
New product/service
Acquisitions
Empire
Make a list of ALL the possible new markets that Relational Capital now allows you to access:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
How much further reach (geography/media/selling approach) can I list, that are available to
me?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What’s the single farthest, highest, widest aspiration I can envision for the business now, that I
didn’t feel possible before the program?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
Whose markets can I/do I want to now control? How can/will I do it?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
What’s the one, greatest single competitive advantage my company will gain from doing this
above all others?
523
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
How will this best help us overpower the competition…locally, regionally, in current/niche
markets, in media, in current/new distribution channels?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________________________
Who could be a great conduit to share joint marketing/selling expenses? Why?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________________________
Who could bring design collaborators to us – graphical product/systems/logistics/CRM, etc.?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________________________
What could we create/accomplish in the next three months, six months, nine months, and
year?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________________________
How many staff/talent/human capital could we eliminate/not require – what’s the combined
value in salaries/facilities, etc. saved?
524
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
List as many ways you will reduce or eliminate risk and enumerate the specific applications they
will apply to:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What would all the approaches you want to pursue cost you – if you had to fund everything
yourself, out-of-pocket, from the start:
Goodwill
Facilities
Personnel
Sales Force
Recruiting/hiring/training
Manufacturing
Customer service
Transportation
Other
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What technology can we acquire or license out and how would each element benefit the
business most?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
What Research & Development could we get other partners to provide that we need or want?
Product/testing/sources, etc.?
525
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
What skill sets are we strongest in possessing and who else would gain from learning our
knowledge/expertise in those areas?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
How many ways, places in our business can we innovate? What might they be?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________________________
Where/what/how can we achieve great purchase advantage?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________________________
What distribution channels do we want access to that we are not reaching or do not have
access to now? Why?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
___________________________________________________________________________
List of hidden assets/resources we possess that could be monetized externally:
526
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What non-core competencies could we most profitably outsource? Why?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
What overhead could we share costs on with other companies? Who/what kind/specific
companies would be best combinations?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Who could we get to endorse our company? What would it require (effort/cost/etc.)?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
My target: 40% of the source of my business, revenue, cost savings (minimum) I would
produce from Relational Capital. Where will the largest, quickest expansions come from?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Since human capital is only as great as the relationship, each and every one of your
contacts/connections establish…
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
527
______________________________________________________________________________
_____________________________________________________________________________
Sources of capital I need to fully harness/maximize/identify:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
HUMAN CAPITAL:
Team members (how do I leverage their performance value higher?) List:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Culture: How do I install/instill greatness/preeminence into our company?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
How do I fuel/monetize/propel greater connectivity within my stakeholders?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________________________
How do I attract/access greater talent?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
528
______________________________________________________________________________
____________________________________________________________________________
PRODUCT CAPITAL:
What can we do to make your company/product/service unique/differentiated?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
How can you improve your leadership?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
How can we turn vendors into partners? What structure can we devise to grow their
businesses through our growth?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
Relationships, Not Just People, Drive New Sales and Greater Profitability
What relationships do we have – that we don’t recognize?
Generic categories of buyers

Vendors
Intelligence
Media
Industry
Influencers
Six Degrees of Separation
529
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Bring it ALL Together

Which answers, realizations, identifications from all the previous questions are most relevant,
financially impactful and easily doable for my business (make comprehensive list)?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Which one will I do first? Why?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
How will I execute/implement that approach?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
530
What do I need help on to do that I am missing (i.e. lack of
strategy/understanding/process/communication sequence, etc.)?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________
Repeat for 2nd, 3rd, etc. – for AT LEAST ten (10) activities:
1.)____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
2.)____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
3.)____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
4.)____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
531
5.)____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
6.)____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
7.)____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
8.)____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
9.)____________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
10.)___________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
532
______________________________________________________________________________
______________________________________________________________________________
My Reverse-Engineered Timeline
Goals/Outcome:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Approaches I’ll take:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Target date I will begin: __________________________________________________________
Target date I want activity achieved:

______________________________________________________________________________
Steps that must be done in order and timeline to achieve acceptance:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
If I know my target relationship prospects, list who they are, and why they represent the
targets I’ll pursue:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
533
______________________________________________________________________________
______________________________________________________________________________
If the target is generic, provide as much depth of understanding of the profile of the
relationship target:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
If I know who I’m targeting, who else can help me access/influence them?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________________________
How would I gain THAT person or entity’s collaboration?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________________________
If I don’t know who I’m targeting, what steps/actions/research do I need to do?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________________________
What questions do I need Jay to answer for me to implement this plan?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
534
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________________________
What problems am I struggling to overcome so I can do these activities?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________________________
What resource do I need to get started?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
____________________________________________________________________________
How will that shift produce greater sales, profits, etc.?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
___________________________________________________________________________
What scenarios do I want Jay to comment on – or work through with me now?
______________________________________________________________________________
______________________________________________________________________________
535
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
___________________________________________________________________________
What are the biggest realizations I gained from hearing other people around my table share
their varied insights, ideas and interpretations?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
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Am I committed enough to actually do these activities? If yes, what will I do every day/week
to reinforce, fortify and expand that commitment?
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If no – why am I less comfortable? (Look at “greatness”)
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Jay Abraham Super Summit Workbook

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Jay Abraham’s

Growing Your Business Exponentially –

Los Angeles 2013

Growing Your Business Exponentially –

1. Excerpts on Liquid Assets by Jay Abraham and Tom O’Neill 7

U EXCERSISES AND ACTITIVIES

U YOUR CUSTOM ACTION GAME PLAN U 478

31. Expanding Your Growth Possibilities 479

Why own private companies?

Why do you own your business?

If your business was a mutual fund…would you buy it?

§ Measuring investment performance

§ RoEV = Equity Appreciation + Dividend / Enterprise Value

think of their business as “an investment”.

§ Out of your control

§ Within your control

Bottom Line on Valuations

What separates Professionals from Proprietors

Enhancing Your Return

II. Anatomy of a Healthy Business

IV. Enterprise Value Engineering™ Strategies

U YOUR NOTES on Liquid Assets and what you’ve just read:

1.1 Webinar Intro

In my experience, our society’s current emphasis on incentivizing individual talent comes at a

1.3 Understand Reality

1.4 What's Your Expiration Date?

In turbulent times like today, reality comes with an expiration date.

1.5 Mastermind Group Alliance

© 2013 Executive Learning Systems

1.6 You've Seen This Movie

1.7 Catalyst for Culture Change

1.8 Make a Choice

© 2013 Executive Learning Systems

1.9 Why You Need to Reconsider

Hi, this is Jay Abraham.

1.10 Coming to Grips with Reality

How are you planning to come to grips with an ever-changing reality?

1.11 The Leadership Mindset

© 2013 Executive Learning Systems

1.12 Misguided Thinking

1.13 What Kind of Leader Do You Want to Be?

© 2013 Executive Learning Systems

1.14 After the Strategy ... What's Next?

1.15 See Beyond the Tip of the Iceberg

Here are the topics we’ll cover in this online workshop.

© 2013 Executive Learning Systems

1.18 What Is a Mastermind Group Alliance?

A Mastermind Group Alliance is a group of individuals who work together, in harmony, to

1.19 Much More than a "Team"

A common misconception about the Mastermind Group Alliance is that it is a team.

On its own, a Mastermind Group Alliance will create organizational momentum.

© 2013 Executive Learning Systems

1.21 How Is the MGA Configured?

1.22 How Is the MGA Configured?

1.23 Why Run Three Groups?

© 2013 Executive Learning Systems

1.24 Is the MGA in Charge?

1.26 Select and Invite MGA Members

1.28 Selecting Components

1.29 Common Questions

In a Mastermind Group Alliance, you have 21 slots to fill.

--Should I include executives only?

© 2013 Executive Learning Systems

opportunities, you can’t afford to have this person on your team.