Become the Business Operating System

Key Points:

0:00 – Opening and Gary’s Momentum
Karl opens the call and checks in with Gary, who says there are many opportunities once the recipe is nailed.

1:07 – Kai’s Early Coaching Stage
Kai shares that he is in the infancy of his coaching business, has a pro bono client, had a low-attendance group meeting, and is working on follow-up and traction.

2:05 – Brian’s JV Margin Question
Brian asks about JV or affiliate deals and whether margin matters when structuring them.

2:27 – Know the Margins First
Karl explains that coaches need to understand the client’s margins before creating affiliate or JV deals.

3:57 – No Standard JV Format
Brian asks whether there is a standard format for JV agreements, and Karl explains that the structure depends on the business and relationship.

4:22 – Accountant JV Example
Karl explains a strong JV with an accountant: the accountant sends clients to the coach, and the coach helps those clients see the accountant more often for better financials.

5:21 – Scoreboard for the Business
The accountant relationship works because the coach needs proper P&Ls and financials to know whether the business is improving.

6:31 – I Keep My Money, You Keep Yours
Karl frames one ideal JV as a mutual referral relationship where each partner keeps their own revenue while helping the same client.

6:51 – Relationship First
Gary adds that coaches should not skip the relationship step by trying to engineer the financial arrangement before trust exists.

7:51 – Brian’s $100 Million Prospect
Brian shares that a $100 million manufacturing company reached out after being nurtured through email campaigns.

8:50 – Leadership and Profit Acceleration Proposal
Brian explains that the company wants help mentoring someone into a vice president of sales and marketing role, so he proposed leadership coaching and profit acceleration.

10:05 – Meet the Decision Maker
Karl advises Brian to try to get on a call with the owner because the owner is the true decision maker.

11:37 – Drop the Bombs
Karl tells Brian he needs three strong “bombs” ready for the owner, so he does not sound like a vanilla consultant.

12:12 – Examples of Bombs
Examples include “build a business you could sell tomorrow but do not want to,” expense reduction math, and “a real mentor can tell you what not to do.”

13:32 – Show Them Where to Look
Karl gives another mentor frame: a real mentor shows you where to look, not what to see.

14:24 – Do What It Takes
Brian says he told the prospect he will do what it takes, and Karl reinforces that this is the right mindset for a major opportunity.

15:29 – Order, Chaos, and Reinvention
Karl explains that successful companies must sometimes create chaos to move into the next stage, using Kmart, Amazon, Blockbuster, Netflix, and Focused.com’s move into software as examples.

17:42 – Bomb Timing Matters
Gary reminds the group that dropping a bomb is like comedy. The timing matters, and coaches need to pause so the prospect can think.

18:15 – “I Never Thought of It That Way”
Karl explains that the goal is not just to get yeses. It is to get the prospect thinking differently.

18:58 – Use an Alter Ego
Karl encourages coaches to use an alter ego, referencing Kobe Bryant’s Black Mamba mindset and the book Alter Ego by Todd Herman.

20:53 – Higher, Equal, and Lower Frame
When selling, spend about 10% of the time in a higher frame, 80% as an equal, and 10% in a lower frame.

21:34 – Use the Higher Frame With Big Prospects
With a $100 million company, Brian needs to show he can teach and guide them, not only defer to them.

22:48 – Avoid Talking Down
Karl warns against spending too much time in the higher frame because successful people do not want to be talked down to.

23:13 – Lower Frame Examples
Karl mentions Tony Robbins, Grant Cardone, and Brendon Burchard using past struggles to create relatability.

25:16 – Make Them Want to Pay You More
Brian shares advice from a mentor: bring so much value that prospects want to open their wallet.

25:30 – Become the Plug
Karl says the ultimate consultant frame is to become the plug. If the plug is pulled, the water drains out.

26:31 – Daily Email as Lead Gen and Retention
Karl explains that daily emails are not only lead generation. They also support retention and keep clients engaged.

28:19 – Keep Creating New Conversations
Karl reminds Brian not to focus only on the big prospect. Keep new conversations, simulator presentations, and outreach moving.

29:08 – Do Not Undersell Yourself
Gary points out that with a $100 million prospect, Brian could potentially have charged more than $5,000 per month.

30:41 – Sell the Gap
Gary explains that coaches are not selling features. They are selling the gap between where the client is and where they want to be.

32:04 – Three Rapport Questions
Karl shares three key questions: when did you start your business, why did you start your business, and what are the three biggest challenges or obstacles you currently face?

33:19 – Sell the Three Problems Going Away
At the close, the coach should connect the offer back to the three problems the prospect named earlier.

34:43 – Warren Buffett’s Two Rules
Karl uses Warren Buffett’s investing rules to introduce two rules of business.

35:08 – Two Rules of Business
The two rules are: get clients and keep clients.

36:26 – Two Rules of Coaching
The two rules of coaching are establishing the starting line and the finishing line.

36:45 – What Do You Want?
Karl explains that the hardest question for many business owners to answer is what they actually want.

38:54 – Relationship Before Assessment
Gary explains that the first assessment questions should often be answered through relationship-building before the formal assessment begins.

40:09 – Rapport Comes Before Close
Karl explains that if closing rates are weak, the issue is often the rapport-building stage, not the closing script.

41:12 – Take Them Back to the Beginning
Asking why they started the business brings them back to a time of greater energy, hope, and purpose.

42:20 – Make Them Feel Understood
Business owners do not only want to know that you understand. They want to feel understood.

43:03 – Build to Sell, But Don’t Want To
Karl explains that the higher frame is helping owners build a business they could sell tomorrow but do not want to.

43:21 – Hire Your Replacement
One way to build that kind of business is to hire the number two person from the number one competitor.

44:36 – Staffing Question
Christopher asks how to respond when the business owner says they cannot find or keep good help.

46:22 – Four Predictable Business Problems
Karl says business owners usually name one of four problems: sales, marketing, systems, or staff.

48:09 – Remove the Objection Early
If staffing is the issue, the coach can explain early that the business will become strong enough to attract and retain better people.

49:10 – Staffing Has an MDP Too
The staffing problem can be approached like the business itself: why is this the ultimate employer for the ideal employee?

49:40 – Four Staff Motivators
Karl lists four staff motivators: rank, recognition, prizes, and money.

50:46 – Recognition Matters
Public praise, titles, and acknowledgment can motivate staff more than business owners realize.

51:35 – Why Good Staff Leave
Good staff often leave because expectations were unclear, which points back to culture.

52:15 – Rules Create Culture
Karl explains that strong culture requires rules, just like sports require rules.

54:18 – Vacation Mickey Points
Karl shares a family vacation example where “Mickey points” helped shape the desired feeling of the trip.

55:00 – How Do You Want It to Feel?
The same idea applies to business culture: define how the company should feel, not only what it should do.

56:00 – A-Players Raise the Team
Karl explains that one A-player can be worth five to ten B-level employees.

57:00 – Prizes and Staff Motivation Example
A trucking company could motivate drivers with performance-based prizes, such as a Vegas trip.

58:30 – Staff Referral Effect
When employees are excited about meaningful recognition or prizes, they naturally tell peers, which helps recruiting.

1:00:00 – Moneyball and Rulebooks
The group discusses Moneyball, second-tier players, and how different rulebooks create different results.

1:03:00 – Football and the Line of Scrimmage
Karl explains that football is often won on the offensive and defensive line, even though fans bet on the quarterback.

1:06:00 – Small Improvements Compound
Karl connects Moneyball thinking to the Focused.com system: small incremental changes in multiple areas create a compounding effect.

1:08:00 – Adrian Ulsh Tribute
Karl mentions Adrian Ulsh, his legacy, and what Adrian would likely tell coaches.

1:09:00 – GOYA
Karl says Adrian would tell coaches to “get off your assets” and take action.

1:10:00 – Transformation as Adrian’s Word
Karl says Adrian’s favorite word was transformation and explains what real transformation means.

1:11:00 – Square to Cube, Not Square to Triangle
Transformation is not abandoning what is good. It is adding new dimensions and expanding capacity.

1:14:00 – Accounting as Transformation
Karl explains how adding financial literacy to his sales and marketing background transformed his coaching approach.

1:17:00 – Keep Serving the 96%
Karl notes that if coaches only target large companies, they miss the 96% of businesses that never reach $1 million.

1:19:00 – Daily Email Builds Mastery
Karl explains that writing the daily email himself helps him learn more than if AI wrote it for him.

1:21:00 – Ty’s Business Broker Meeting
Ty joins and shares that he is about to meet with a business broker to explore a possible JV.

1:22:00 – Three Reasons Businesses Do Not Sell
Ty correctly identifies the three common sellability blockers: owner dependency, low profitability, and lack of systems.

1:23:00 – Broker Relationship Frame
Karl explains that many businesses the broker meets are not ready to sell, so Ty can help prepare them and send them back in 12 to 18 months.

1:24:00 – Business Broker Mastermind Story
Karl shares a story of a business broker and coach who ran a mastermind, then sold seven of the ten companies.

1:25:00 – Business Broker JV Opportunity
That story shows how powerful the business broker relationship can be when the coach helps owners increase business value.

1:26:00 – Use the Prospect’s Eyes
Ty asks whether he should mostly listen or demonstrate. Karl says that with the business broker, he should use the broker’s eyes and ears by showing the simulator and operating system.

1:27:00 – Demonstrate the Operating System
Karl advises Ty to show how the system helps businesses become more profitable, more systematized, and less owner-reliant.

1:28:00 – Installers vs. Hiders and Wingers
Ty should position himself as an installer with a proven operating system, not someone winging it.

1:29:00 – Closing
Karl wraps the call and reminds coaches about Workshop Wednesday and Thursday’s Get Your First Client call.

Five Key Takeaways

• Relationships come before JV mechanics. Build trust before trying to structure financial terms.
• Coaches need three “bombs” ready so prospects hear something they have not heard from every other consultant.
• Strong rapport starts with three questions: when did you start, why did you start, and what are your biggest challenges right now?
• Most business problems fall into sales, marketing, systems, or staff. Coaches should be ready to connect each one back to profit and the operating system.
• Business brokers can be strong JV partners because many owners are not ready to sell. Coaches can prepare the business, improve value, reduce owner dependency, and send the owner back when they are ready.

Notable Quotes

“You have an operating system that can be installed into any business.”

“You don’t do your best. You do what it takes.”

“You need your three bombs in your back pocket.”

“A real mentor can tell you what not to do.”

“You want them to say, ‘I never thought of it like that before.’”

“Become the plug.”

“You’re not selling a solution. You’re selling the gap.”

“Rule number one, get clients. Rule number two, keep clients.”

“The two rules of coaching are starting line and finishing line.”

“They don’t want to know that you understand. They want to feel understood.”

“Sales, marketing, systems, and staff.”

“Rank, recognition, prizes, and money.”

“Small incremental changes in multiple areas create this compounding effect.”

“Transformation is adding dimensions.”

Action Steps from the Call

1. Build the relationship before discussing JV compensation.
2. When exploring a JV, look for mutual value before financial engineering.
3. For accountant JVs, show how you help clients need better financials more often.
4. Keep your own revenue and let the JV partner keep theirs when possible.
5. For major prospects, request time with the real decision maker.
6. Prepare three “bombs” before high-value sales conversations.
7. Practice dropping those bombs with timing and silence.
8. Use an alter ego if it helps you bring stronger confidence into the room.
9. Spend some time in the higher frame, most of the time as an equal, and some time in the lower frame.
10. Build rapport before you attempt to close.
11. Ask when they started the business.
12. Ask why they started the business.
13. Ask for the three biggest challenges or obstacles they face right now.
14. Take detailed notes on the prospect’s exact words.
15. During the close, connect your offer back to the three problems they named.
16. Define the prospect’s starting line.
17. Define the prospect’s finishing line.
18. Use the simulator to demonstrate the operating system.
19. Be prepared to address sales, marketing, systems, and staffing problems.
20. For staffing issues, help the client define why they are the ultimate employer for the ideal employee.
21. Build culture through clear rules and expectations.
22. Use rank, recognition, prizes, and money to motivate staff.
23. Create performance-based prizes that make employees excited to stay and refer others.
24. Use small improvements across multiple areas rather than betting everything on one big fix.
25. Keep taking action after a big opportunity appears.
26. For business brokers, explain the three reasons businesses do not sell.
27. Offer to prepare unsellable businesses and send them back to the broker in 12 to 18 months.
28. Position yourself as an installer with a proven operating system.

Resources & Tools Mentioned

• Joint Ask the Expert
• PAS / Profit Acceleration Software
• Profit Acceleration Simulator
• Business Operating System
• JV Partnerships
• Accountant JV
• Business Broker JV
• P&L
• Financial Statements
• Scoreboard
• Three Bombs
• Business Coaching Secrets Podcast
• Alter Ego by Todd Herman
• Kobe Bryant / Black Mamba
• Steve Jobs
• Jeff Bezos
• Warren Buffett
• Grant Cardone
• Tony Robbins
• Brendon Burchard
• Coke
• Geico
• Kmart
• Amazon
• Blockbuster
• Netflix
• Focused.com Software
• Moneyball
• Malcolm Gladwell
• Vegas Golden Knights
• Predictably Irrational
• Adrian Ulsh
• GOYA
• Jumpstart 12
• Sales
• Marketing
• Systems
• Staff
• Market Dominating Position / MDP
• Staffing MDP
• Rank, Recognition, Prizes, Money
• Business Broker
• Alignable
• Exit Planning
• Owner Dependency
• Systematization
• Profitability
• Hiders, Wingers, Installers