How To Get Your Whole Team To Think Like An Entrepreneur

Dan Sullivan: Hi everybody, it's Dan Sullivan here, and this is the next episode of Free Zone Frontier, and my partner, my instigator, my interrogator, Steve Krein is here, and Steve has the good fortune of being a lawyer, but no longer a lawyer. He's got all that training of asking really great questions, and he's an amazing Free Zone entrepreneur himself because he has what I call the world's first entrepreneurial global R&D lab. Last count, 500 companies are in your systems, thereabouts. And it's an amazing model that you've created. I just presented to Steve a new program that we're putting into Strategic Coach using a particular tool called The 4x4 Casting Tool. So I sent him the material and I said, what do you think of this stuff, Steve? And Steve said, let's do a podcast on it.
 
Steve Krein: Yeah. Well, you know, Dan, I think as we talk about, and I know we've talked about on this episode, but also in other podcast series, you have the 4x4 and the concept behind it, which we can talk about for a moment. But really what I was most struck by was the framing of a team incentive strategy for rewarding the team for actually taking both incentive to complete the tool, but also own the regular updating of the tool. And so I thought the idea of just an incentive strategy for your team, I've seen a lot of things over my lifetime in Strategic Coach. And this is one that I think is both very practical and interesting in this moment where we're seeing entrepreneurship become much more commonplace and people starting and doing things that I think are demonstrating their own entrepreneurial drive. And I think you're giving people some control here of their roles and their reporting and their, quite frankly, transparency and vulnerability that just hadn't seen before from the bottom up versus the top down. So I thought it would be a great way to kind of unpack it with you a little bit.
 
Dan Sullivan: Steve, I'm just going to sort of give an overview of what the 4x4 is. And it's basically treating your entrepreneurial company as a theatrical company rather than a budding corporation. Okay. And what we're contrasting, and this is really the topic of one of our new major books, which is called Casting Not Hiring, which I'm writing with Jeff Madoff, who is a great friend, and he's a theater producer, he's a playwright. We have another podcast with Jeff, which is Anything and Everything. But we've been investors in a great play that Jeff created, which is going to London now in the UK. So over the years, we've just talked a lot about theater. And I said, you know, the thing that really strikes me is the division between whether your entrepreneurial company is going to become a bureaucracy or it's going to become an incredibly innovative in the marketplace enterprise, is how you treat bringing new people on board into your company.
 
So about 10 years ago, I created a tool which was called the 4x4, where it's not a job description, it's not a technical job description, but it tells people how you expect them to show up, when they show up, how they show progress in terms of getting things done, and then how they can be a hero to you if they choose to be, and then basically how they can drive you crazy, okay? And you lay this all out right up front. Actually, Gord Vickman, who's the manager of our podcast here, this is how Gord came on board seven years ago. When he got it, it was before he was finally accepted. I just said, you know, if you're going to be my podcast manager, this is the deal. And I haven't added one thing to it over the last seven years, because as soon as Gord had it, he took ownership of his own profile, his own role in the company. I don't think we've had a single meeting that was like a performance review. It's just he keeps updating this 4x4. Then we have conversations and he'll adjust it and everything else. So that's the background for how we're going to apply this system-wide and Strategic Coach.
 
Steve Krein: Yeah, I think for those listening and haven't seen the 4x4, the idea of the four buckets of really being a better performer and what it's going to take to give your best performance, your biggest results and what it takes to get your best results, being a hero, which I think is a really unique … The other two are kind of like you'd see in a lot of job descriptions. What you wouldn't really see is what it's going to really mean for you to be the hero to me or to the company over the next 12 months or six months. And then I've always loved what drives me crazy kind of framing, which is a really unique way of saying, as long as you don't hit these three or four things, we're going to be good. But more interesting to me is the fact that you flip it and give it to the team, not to look at yours alone, but to actually do theirs. So can you talk about that additional dimension versus being the entrepreneur, filling it out and giving it to somebody versus giving it to them and having them fill it out for themselves?
 
Dan Sullivan: Yeah, there's a transition. So we experimented in just about three or four months with the entire team worldwide. So we're in three countries and we have about 120 team members in the company right now. And I just wanted to test it because a lot of them, you know, been in the company for a long time. But when new people come in, the person who's doing the hiring, and that would include a team leader, and then we've got a team that really brings people on board, we actually put this out to them. We want you to know what it's going to be like on the first day when you join us, and they get this. So we're doing it for them, okay? But what we're seeing is how quickly we can flip it. where they simply keep updating their role and keep adding new dimensions to their role. You know, we have a goal that entrepreneurial companies should be self-managing, which means that every team member is actually managing their constant growth and upward movement in the company. So I wanted to see that, and I tested that three or four months ago, and now we're ready to do it every quarter and to have an incentive plan that actually rewards them for doing it. Can we use that as a jumping off point?
 
Steve Krein: Why? Why do you need it? What happens without it? And just to contrast it, like, what does the world look like where your team has no incentive to do this other than your own process and interest?
 
Dan Sullivan: Yeah. Well, I think the big thing is that, first of all, something major has happened in the world over the last five years, and that was COVID and people going remote. Okay. The big thing is in the last five years, we had, of course, the COVID event, which was practically three years where everybody probably went completely remote for at least a year of it. And then we've gotten back to the point where it's mostly half and half. They might be in the company half the time. Some companies are completely virtual forever. So the question is, when they're remote physically, you have to do something double down on making them feel connected all the time. And the way we said, I don't think a job description will do that. You know, I don't think a job description has the ability to do that because it's basically impersonal and it's technical. They're simply saying this is the job. These are the activities. But it doesn't really say anything about the working relationship that people have. So that's my main reason for doing that.
 
Steve Krein: If you were to benchmark the completion rate when there was no incentive, what would you say the benchmark that you're trying to increase from or multiply from is right now, just generally speaking, as it relates to asking people on the team to fill it out?
 
Dan Sullivan: Yeah, I think the big thing is that they're not just doing what they've been instructed to do, that they're going beyond. And they're doing it for their own reasons, that they're growing in their, not their job, they're growing in their role. Okay, because the job says, you know, if you show up every day and you'd sort of do this stuff, then it's good. But you know, Steve, and I know, that we want things to grow, and if they're not aware of how we want things to grow, then we get irritated. You and I get irritated. If the person isn't picking up on signals from their environment, they're not doing it, and we get unhappy. And partially that's okay, because our job in the company is to push things forward. But it's not okay if we're sending messages to the person, I'm really unhappy with you, but I'm not going to tell you why I'm unhappy with you. So they go into guessing mode, they go into defense mode. And there's one thing I know, people who are playing defense cannot create.
 
Steve Krein: Complain or create. You can't do both at the same time. So the framework of the incentive structure is how are you thinking about this for V1? And I'm assuming this is V1 of you. You've never incentivized the team before with a completion of a tool or any achievement, and then there's a result of monetary compensation.
 
Dan Sullivan: This is the first time we've done it. I mean, it's a fairly straightforward tool. It's a little bit daunting when you first do it. We wanted to check out for three or four months, and some of them have their sheet printed out, and they have it right in front of them at their home, and they're looking at it every day. So we know that I would say probably half the team is relating to this role description that they've done for themselves, and they've had to coordinate with their team leader that the things that they're working on and want to be a hero at really relate to the team agenda, and it relates to the company agenda. So we've had about three or four months to check that out, and it's 50%. It's pretty good, you know.
 
Steve Krein: 50% are completing it without any incentive.
 
Dan Sullivan: Yeah, just the quest to do it.
 
Steve Krein: Okay, so that's the benchmark. So for those who haven't heard the concept before, what's the plan? What's the incentive and what's the offer and the result of what you're asking everyone on your team to do?
 
Dan Sullivan: So what we did is we just set it up for a one-year project. Okay, so it's 2025, four quarters. And we say that we're going to have a live coaching session at the beginning of every quarter. Cathy Davis, who's a very, very significant leader in the company, and she's going to have a Zoom session. She's going to say, okay, we're just going to take the next half hour, and we're going to fill in our 4x4. And she takes them through. It's basically four minutes for each of the quadrants. You know, you've got four minutes. And the first quadrant says that we want you in your performance. Whenever you're encountering or dealing with someone else in the company or somebody from outside the company, client, we want you to show up as alert, curious, responsive, and resourceful. And then we want you to identify what do you have to be alert to, to be a more useful team member.
 
I do find intriguing that you're more curious about how are you more responsive to things that are happening around you, and how are you more resourceful in getting your work done, okay? And they have to specify what this is, but of course, they're the ones in the job. They know the activity every day, so all they have to do is be more alert, curious, responsive, and resourceful with what they're already doing. That's the performance, okay? The second box is what you're doing, certain things you do faster, you do them easier, they're less costly, we're getting more done at less cost, and you're producing a bigger result, both in your individual work and in your teamwork with other people. Okay, so that's results. Then we say that's required of everybody. Would you like to be a hero? So tell us just what you know that you can be a hero. And this is a lot of conversational with other team members, conversation with the team leader, and you're doing this.
 
What I did is I did one on myself that I'm using in the Free Zone. So when you come in January for your Free Zone workshop, we're going to actually have each of the Free Zone members do this for themselves, okay? And I always use the second person personal. I don't say I'm going to do this. I'm saying you're going to do this as if I'm casting myself in a role. Okay. So there's four projects, which are really, really crucial. These are brand new projects. These are brand new things that haven't happened before. So I list those four. And then the fourth box is where you're really departing from the job world. And I say, and these are four areas that I know I drive other people crazy. Okay. One of them is that I brainstorm out loud. Okay. And I say, you know what we ought to do? We ought to do this. And people are listening to me and they say, you know, Dan really wants to do this. No, Dan doesn't really want to do this. Dan wants to talk out loud about doing something. Okay. So I've got a rule. We have another tool called the Fast Filter. And I said, here's the rule. If you hear me talking, if it doesn't show up in a Fast Filter, you can just ignore anything that I'm saying. But if it shows up in a Fast Filter, it's 100%. I'm 100% committed to this.
 
Steve Krein: So can I just ask you a question? Because I might be picking up on a slight deviation for how this has evolved. This used to be what drives me crazy.
 
Dan Sullivan: Yeah, this is if I'm using the tool to bring someone on board. It's an added dimension. I won't say it's an addition. It's an added dimension.
 
Steve Krein: Sorry, added dimension to it. So when you ask somebody to fill this out for themselves, it's almost their playbook. Here's a playbook of working with me. And I'm giving it to you, and you now know how I want to have my interaction with you and what I expect of you.
 
Dan Sullivan: That's absolutely right. So I want to differentiate between someone who's already in an existing and has been in their role for a period of time. Okay. We ask them to fill it out the first time. We don't tell them because they're already on board. This is where someone brand new is coming into the team. Then it's our job to tell them what the game plan is and what's expected of them.
 
Steve Krein: Okay. Gotcha. So they fill this out. Let's come back to the incentive. What are you asking them to do? What's a quarter and the reward at the end of the year? Because it's a 2025 project. You've broken it down into quarters and what you expect them to do each quarter and what they're going to get for it.
 
Dan Sullivan: Yeah. So to be incentivized, in other words, for it to be rewarded for it, you do it in the first month of every quarter. So it has to be in by the end of the month. Not the day after the end of the month, before the end of the month, okay? It has to be typed up. We're going to put it on Google Docs, and everybody's is on Google Docs. So not only are you telling yourself, you know, what your role is and how you're improving in your role, you're going to share how you're doing that with everybody else, okay? Now, here's the thing about it. It's voluntary. You don't have to do it. But your not doing it will be noticed. And they say, well, what does that mean? I said, well, just notice that you're not doing it. If you do it, you go through, you fill it in, and you get it in by the end of the month. In the first payday after end of the month, you'll be paid $250 for doing it.
 
Steve Krein: Just add it to their paycheck, or are you giving them a gift?
 
Dan Sullivan: Yeah, it just goes out with their next paycheck.
 
Steve Krein: Gotcha. So $250 a quarter. They can make an extra $1,000 for just completing this tool.
 
Dan Sullivan: Yeah. play. This is brand new, Steve. So the questions.
 
Steve Krein: Yeah. You know, I poke and prod. So is this a whole new way of thinking about working with your team? And in particular, and I'm looking at two perspectives. One, it's really important. To you, is it worth $1,000? And to me as the leader of the company or the CEO, is this something that I really want people to know it's important to me and it's worth $1,000? That's obviously a filter that every entrepreneur founder needs to ask is, what's important to me? Second of all, the alignment of giving a monetary result. And then the question, of course, is potentially could there be other things, where there might be a series of things that you really like people to take seriously, you take it seriously, you value it, you think there can be very effective, and is this almost not just a test of the 4x4 incentive, but could this be a way that we're moving into a different potential generation of relationships between giving people the power to control not only their income, because you give them more, but also make them partners in the results? Or am I overthinking it?
 
Dan Sullivan: No, you're not overthinking it, because the thinking is going to have to be done. But essentially, it's not a program or a project, it's actually a platform. We're trying to create an entirely new platform where everybody is taking a leadership role in relationship to what they do. If you're going to have a Self-Managing Company, that means that people are managing themselves. But we've never figured out how to do that. I mean, we do Unique Ability tests, so that's a standard feature of Strategic Coach. Everything operates in a team. You're a team member. You're not an employee. You're a team member. So we've changed the language. That's been in place for 25 years. Yeah, but what's the activator of that? You know, what's systematic about that? We've never had something that was systematic about it.
 
Steve Krein: Well, it's interesting. I've rarely heard you get involved with operational stuff in a company like this, but it's interesting. Like usually that's a different, what do you say? You're not allowed to touch certain buttons and do certain things. But I think it's interesting because it's a very entrepreneurial perspective of running a company. And when you talk about visionary and integrator, when you talk about these roles, I just think it's an interesting kind of way to get more entrepreneurial thinking within your team.
 
Dan Sullivan: Yeah. I mean, we've had enough experience with it to know that certain individuals, if they take the 4x4 seriously, you know, and they do update it, they take ownership of their role. So they have an ownership of their role. And I just had a 10x Connection Call this morning, so two hours, and I took all the entrepreneurs through their 4x4, and they were really struck by it, that they're a hero to their own company. They're not just the boss, they're not just the owner, but they have the role of being a hero and their role is to keep creating a bigger future for the company and for everybody's roles in the company. And it was very striking to come and say, I've never seen myself in this role. And I said, no, but everybody else sees you in this role.
 
Steve Krein: Can you explain the difference between that and what might have happened five years ago when you took us through the tool? Like, what's the difference between going through this tool before and now going through this tool now? Like, in terms of that shift, is there a difference in what you're …
 
Dan Sullivan: Well, the aspirations, my aspirations, Babs Smith's aspirations keeps going up about what we want the company to do. But it's our company, of course we're gonna be involved in it. But the further people are away in the organization, I mean, if we had 15 people, you could do it over breakfast in a restaurant before you came to work that day. But with 120, and they're in three countries, it's stretched out more. And that plus the COVID impact, very few of them are coming to the office more than half the workdays. So there's been a stretching and a straining We've talked about this on previous podcasts.
 
Steve Krein: It's a new generation of expectations. And, you know, many years ago, there was a book written called The Results Only Work Environment. Maybe it was in your bookshelf at Coach, I forget. But I remember reading it and I'm going back to probably mid-2000, 2005 or 6. And I remember the idea of like results only. It's a focus on people just getting results and taking responsibility for the results. As you kind of outlined this leap, and I think it's a very interesting question about the future of work and the future of a Self-Managing Company, do you anticipate if the test goes well, and I know it's a test, but there could be three to five additional big important things that employees or team members are rewarded for that are important to you. And maybe even more than that, do you see this being almost like, I can make X amount of money? These are the ground rules of coming into the company. I've got to take ownership of my own 4x4 on my own. Because salespeople are kind of already built like this, where you have an incentive to, you close more deals, you close more sales, you make more money. But that's not everybody. And everybody doesn't think that way. And they're not all motivated and built that way. Do you see this transcending all types of team members? Or do you think this is not meant for a certain group of team members?
 
Dan Sullivan: Now, if it's gonna work, it's everybody. You know, once you're establishing a platform, you're really saying that this is our culture and this is being reinforced every 90 days by everybody participating in defining what their role is, clarifying what their role is, adding new dimensions to their role. With being a hero, you're adding new dimensions to your role. Okay. The other thing is very interesting and people said, well, this is our leadership team because I wrote this up on Monday of this Fast Filter. And I submitted it to Babs and I said, Babs, do you think this is viable? And she said, yeah, this is terrific. I really like this. So they were having a meeting on Tuesday and Wednesday and this is EOS. So they're in for their EOS meeting. Entrepreneurial Operating System, which is another company system that we not only use, but we really recommend that our entrepreneurs utilize the services of Entrepreneurial Operating System. So they asked me to come into the meeting. I'm usually not invited to the meetings because I create havoc. They invited me in and they said, this sounds really great. They had already worked out the complete implementation system by the time I got there. So Monday was two days ago. The meeting was yesterday and we're launching. So it was good because the Fast Filter was fairly comprehensive.
 
Steve Krein: When was the last time you had a recommendation on how the company should run?
 
Dan Sullivan: It's so far in the past, I can't remember.
 
Steve Krein: You outlined an idea. I think it's got more implications to the future of work, entrepreneurial work.
 
Dan Sullivan: I believe it does, too. Yeah.
 
Steve Krein: Yeah. It's a very interesting framework, Dan.
 
Dan Sullivan: Yeah. So we have the contract with Hay House who produced our first three books, Who Not How, Gap and the Gain, and 10x Is Easier, and they've sold really well. We got the numbers last week that the three books have sold 865,000 so far. That's including everything, hard copy and e-books, everything else. So they've been asking us now for about the last year, is there another book coming? So we created the book as one of our quarterly books, and we just send it to them. And they loved it. They came right back. And they said Casting Not Hiring … Jeff Madoff and I have been talking about this because we've been involved with his play for the last six years, which is going to London now. It'll be opening in the West End, you know. West End of London is as important as Broadway. Actually, they have more theaters than Broadway does in the West End.
 
So anyway, we've been talking over the years, and we were just having a podcast, and Jeff said, you know, I think there's a problem. And the problem is that in theater, you're casting for roles, but in businesses, you're hiring for a job. And he says, I think these are such separate worlds, that the hiring for jobs doesn't produce any kind of real front stage impact. As a matter of fact, the back stage and the front stage can be totally separated from each other. But if you take the theater approach, it has to be totally integrated. So we have the outline of the book, and it's really interesting because we're going to have Jeff sort of at the front. He's going to kind of explain, because he's both an entrepreneur and in theater, he's going to explain, you know, what a theatrical enterprise really is for entrepreneurs, and then what kind of economy is growing up. Part one is what a company like this looks like, and then what's the environment that we're in right now in the 2020s. And then the third part is casting your roles in your company, so to be the tool.
 
Steve Krein: Now, it's a great first tool to test this concept of incentivizing your team to do the things that will help move your company towards being a Self-Managing Company. If you were thinking of another tool for next week, because I know you do them weekly now, how might you think about the lens of not the tool of a 4x4, but the tool to think through the execution of this idea? So put the 4x4 as that's what the incentive is going to be for. But what's the overlay to think about? Incentivizing your team to do things that you know are important, that helps move it to self-managing, that gives them the control and all those things you just mentioned. Is there one in your mind yet, or have you …
 
Dan Sullivan: You're asking a great question, Steve, because my feeling is that this platform will now generate all sorts of requirements as you go forward. Like, you do it the first quarter, and you say, hey, we could have another tool that sort of supports this, but I don't know what it is yet. I mean, we have some standard tools, like Fast Filters, like Impact Filters, Certainty/Uncertainty and everything else. And we can actually take a lot of tools that are really for the clients and we can provide them back. We're almost treating our, I hadn't thought about this before I'm saying it right now, but we're always saying we're going to treat our team members as if they're our clients. Now that you say that, that's where I was going, like there's something bigger in this. But I don't want to get too, you know, a Canadian term, don't get too far ahead of your skis, you know. But I'm really intrigued and we're going to report on it too. Today, I gave 58 people, these are 10x clients, some Free Zoners, but 1x. And I gave them the Fast Filter and they said, wow, this is how you set up projects in your own company? I said, yeah, this is how we set up things.
 
Steve Krein: Well, if you go back to probably 2004, 2005, you had a tool around intellectual property developer, and it was like the eight teams of Strategic Coach, and it was like the writing team, the design team, the this team. And you kind of outlined it, and I remember you sharing it one day, and it was like, oh, that's how you set up, like, you gave people a blueprint for like, okay, here's how you set up an intellectual capital company, how to think about the eight teams that, by the way, I don't know how many teams you have now, but you had at that moment, you were outlining the eight teams that create the tools, that design the tools, that run the workshops, that do all those things. I almost feel like you're doing the same thing here, which is like, I'm giving you another way to think about how to structure your company.
 
And I do think the really interesting thing is the new post-COVID workforce, entrepreneurial collaboration, I think, self-managing, I think all these things are very interesting to weave together. But I think there's something bigger here than just an incentivizing for a 4x4. And it's interesting as I think about in this moment where everybody's recalibrating for the new year, like, hey, what's our plan for 2025? And you do a new VTO and, you know, an EOS and you roll out your Q1 rocks. I think it's really interesting to think about, even if you don't do it, what else would fall into the category of if I could pay my team to do this, it would not only get great results, but it would show the importance of what one, two, or three other things are that really move the company towards self-managing and towards results that you're looking for.
 
Dan Sullivan: Yeah. First of all, I'm very gratified with your vision for this. I'm very, very pleased because I'm kind of in it, you know, I'm kind of doing it, but you're looking at it from my report and you're seeing all sorts of other things. For example, if you looked at StartUp Health, we have all 500 of the owners, or it's probably more than 500 owners, maybe average two per company. And they all did the 4x4. They did the 4x4. It'd be an interesting test. What is their role? And then who do they have around them? So it might be very contagious, what we're doing here.
 
Steve Krein: Yes, And—by the way, I took an improv class this summer, the Yes, And tech class.
 
Dan Sullivan: Yeah, that's great.
 
Steve Krein: Yeah, I did it with my daughter, by the way.
 
Dan Sullivan: You took it at Second City?
 
Steve Krein: No, we did Magnet Theater here in New York. There's Magnet Theaters, one of the big ones. But we took a 10-week course every Wednesday. It was a great activity.
 
Dan Sullivan: We did Second City in Toronto.
 
Steve Krein: You did an improv? Oh, it was wonderful. Get you out of your head, kind of.
 
Dan Sullivan: Yes, And, you know?
 
Steve Krein: Yes, And. So coming back, Yes, And, 4x4. While I am excited about that, and I think it's got practical application, I really think there's something about aligning it with the incentive to not make it another thing you're bringing back to your team to have them do. We've long discussed when you come back from a Strategic Coach workshop, the team grunting about, oh God, what did he or she learn that she's going to ask us to do. And in the healthcare industry, one of the biggest challenges entrepreneurs have in start-ups is getting adoption of their ideas inside of hospitals and inside of clinical practices where the nurses, the PAs, the doctors roll their eyes and go, oh, another tool. Oh, another thing that's supposed to make me more efficient. But what am I doing about the other 90 things I have to do?
 
The reason I'm giving this context is I think there's something very powerful about not coming with a request, but coming with a reward system for doing something. And I think there's something very nice about that idea. If you, for example, came to your team on January 7th, like you said you're doing for this, and you said, we're gonna have everybody in the company doing 4x4s, and you're gonna be expected to do it every quarter, and by the way, if you don't get it done by the last day of the first month, there's gonna be consequences. There's gonna be punishments. Yeah, they'd be like, oh God, okay, an Impact Filter, and they'd start naming all the things you want them to do. But you were really clear, saying there's one thing, you get $1,000 more, 250 a quarter, you complete this tool by the end of the first month, you get rewarded, I'm happy, the team's happy, the leadership team's happy, and most importantly, so is everybody that works with you. That's a pretty different, like, hey, he or she's coming back from Coach, and I'm making more money, or I'm getting rewarded for these things that he or she has brought back to make us a 10x company or a self-managed company. So in any event, that's it.
 
Dan Sullivan: Get off that real … I want to tell you what you're telling me is incredibly valuable.
 
Steve Krein: Good. Well, what you shared is incredible. I think there's a really fresh, and I'm going to underscore fresh way of thinking about aligning team incentives outside of your sales team, which is always aligned or typically aligned with it.
 
Dan Sullivan: But even they don't see themselves as having a unique role.
 
Steve Krein: Yeah. Well, they're just about, hey, if I bring my money and I, if I bring customers and our clients and I make money, but not the operational, because I agree. I think it's a really interesting non-revenue-based incentive program, which is about the operational excellence of the team. It's great.
 
Dan Sullivan: Yeah. One thing I experimented with, remember the book, The Great Crossover?
 
Steve Krein: Yeah, of course.
 
Dan Sullivan: Yeah. And that was written in ‘94, ‘95, I think. What I was observing, and a little background to this, I became a coach because I was reading articles in the New York Times about a thing called the microchip in 1973, ‘74. I don't know who the technology writer was for the times, but he had some very, very prescient columns. The word microchip had been around for 15 years, but it was mostly inside the technology community. It wasn't a public word, because it was called integrated circuits when Gordon Moore established his progression of three data points of how this thing called an integrated circuit seemed to double in power every two years, every 18 months, two years, and then the cost of computing went down by half, so it was a four times return. That captured the technology world's attention, but the public wasn't really aware of this at all. So his article was in 1965. And he said, I wonder if we keep improving these integrated circuits, you're going to see that constant increase of productivity.
 
And so by the early seventies, he had had more data points and it was starting to become obvious. He never agreed that it was a law. He said it wasn't a law, but he says, I think it helps focus human aspiration. I think we've got a structure here. It's been steady. I mean, it's been pretty straightforward for 60 years, what he's talking about. So I got a hold of this, you know, and I was still at the ad agency. I was still a copywriter at an ad agency. And I was reading this and I said, all hell's going to break loose. I was reading these articles. I think we're in for like a Gutenberg type revolution here, you know, or Edison, you know, electrifying cities. I said, I think this changes everything. But his two main things, he said, large organizations, which are pyramidical with many layers of management, are going to have a hard time dealing with this new invention, because it's an invention that could be applied to almost any other existing invention, beating it up, making it much more productive, but microchips can be used to make greater microchips.
 
Steve Krein: I hope the kids listening are realizing that the description that you're outlining right now seems very similar to what's going on right now.
 
Dan Sullivan: So I predicted there was going to be a 50-year period. We were at ‘94, so we were already 20 years into this. And I predicted that between ‘75 and ‘25, so 1975 to 2025, I said, I think the whole world's going to get turned on its head. And it's going to be driven by entrepreneurs, not by large corporations. I mean, 75 entrepreneurs were marginal creatures. They were sort of unemployable marginal creatures. And then when the personal computer came along, that changed things dramatically. And then software came along, that changed. And then the internet came along, that changed things. And then it went mobile with cell phone. And then social media became a crucial thing. Now AI. So you've probably got six multipliers that have happened. And here we are in 2025, and everything has changed dramatically.
 
Steve Krein: But I think it's interesting, of all the different multipliers, I think the one you're describing and this one, you know, the internet, mobile, all these different ones are multipliers. This one's a little either bigger than or as big as the biggest of them in terms of the democratization of roles and responsibilities and I know you know this because of the Who Not How framework, but Who no longer means even a person, there are now agents and companies building replacement people for organizations that no longer make this about delegating to only people. So I think it's a really interesting kind of framing. And so the role of the team member is changing because they're able to delegate a lot more to technology, as you were describing. And so I think it's really interesting to give the power of their role to the individuals on the team and then incentivizing them. And I'm really excited about over the next 12 months, not always seeing the results. You can imagine a lot of your clients are going to do the same thing. I mean, it's hard to hear this and not think about doing the exact same thing with your team and testing it out and seeing what the results are of having teams not only get rewarded for doing some of the operational stuff that you're asking, but get really clear with their role.
 
Dan Sullivan: Yeah, I got two aims here. One is that it works for a Strategic Coach and that works for all the entrepreneurs and Strategic Coach. Yeah, it was very interesting. I was at Genius Network, one of the 100Ks, Babs and I are in the 100K, and there was a early investor in the technology world there, a really great guy, and I gave him a copy of our small version of Casting Not Hiring, and he says, wow, that's a really interesting idea, Casting Not Hiring. But he has about 25 companies that he's invested in. They're all start-ups. He said, are you developing this further? And I said, yeah, I'm developing it further. He says, you tell me and I'm going to get this out to every one of my start-up companies right away. He said, I'm going to get this whole thing out to it. He says, this is the biggest problem we have, that these people are very inventive in terms of some sort of technology, but they're not inventive in how they organize themselves around actually developing that. He says they're still using 50-year-old ideas for putting it together. So my sense is that I feel my way with this.
 
Steve Krein: It's funny because you just talked about some people not even know how to set up and engage with their team. One of the things that's unique to our community is a lot of academic founders who come out of university, who come out of clinical practice, who come out of the world where it does not operate at all like the world they know. There's intimidation about the way the entrepreneur world works and start-ups work. Unlike somebody who comes from a big corporation into a start-up, it's very difficult. When you come from the academic world and all you know is 20 or 25 years of tenured achievement and stability and all that stuff and the bureaucracy and all that, and you come in and you have freedom to do it any way you want, I think Casting Not Hiring is an accessible framework because everyone's been in the theater and understands the analogy that you're making with this. It’s not any more difficult than you would think it would be to set up and run a theater.
 
And I think I remember years ago, you're sharing the back stage front stage concept, which was I think an early version of just theater metaphors But even that idea that front stage, back stage, everybody can understand that. It's like, I don't need to explain. There's operations, and then there's what you do with your clients, and what your customers see, and what you're taking. So, you know, back stage, front stage. And that's like a really simple way of framing it for everybody, no matter what their experience or perspective is. And I feel like the same thing about casting the hire. You're taking something that's very daunting, very difficult to even get right, no matter how long you've been doing it, Casting Not Hiring just changes that framework for people. And for our community in particular, you gave me an idea around sending out the book to them and really, perhaps, and I can't believe we haven't done this, why haven't we had you on for a fireside chat with my community? Let's schedule a fireside chat and let's actually introduce the Casting Not Hiring. I don't think you have to worry about the incentive piece on it. I think it's just the Casting Not Hiring. The incentive piece is really a nice way of people understanding they can get everybody on board with not as much effort and energy as they might imagine.
 
Dan Sullivan: One of the issues that we always have when we're an entrepreneur and we have an organization, the motivational level and the, what I would say, the aspiration level of your team members is a wide spectrum. It's a very wide spectrum. And, you know, you have concepts out there like only play with A players, you know, only hire A players, you know, fire all your B players. And I said, you know, you're dealing with humanity here. People's contribution shows up in all sorts of different ways. The question is, as the owner and founder of your company, what appreciation do you have for a real width of human contribution to your company? Okay, and my sense is that I think the 4x4 will reveal the contribution. Their aspirations will be on a sheet of paper.
 
Steve Krein: Yeah, not A player, B player, C player.
 
Dan Sullivan: I think it's a vicious system actually.
 
Steve Krein: I think it was introduced at a different moment in time. It's a little like GE days, Jack Welch, you know, days where you fire the bottom percent. It's like, I think it's a very different world and you're right. I think making these entrepreneurial concepts accessible to people who might read a book or have heard about something or thought about something but like everything, you know, you share, I think you've been very practical. So I know this is a long episode. I don't know if we're gonna break it into two or want to do another one. But this really Dan was, every so often, more often, but every so often there's one of those changes in stretching your mind or my mind about something that is either difficult to comprehend or difficult to execute. And I think this is one of those unlocks that does reframe how you think about effortlessly, or as effortlessly as possible, creating self-managing team members who are aligned with not only their role, but some of the behaviors and actions you're expecting them to take and take responsibility for. So really a great one.
 
Dan Sullivan: You used a term earlier that we're democratizing entrepreneurship. And my sense is, first of all, I believe that that's true. Second thing that I believe about it is we're entrepreneurializing, if that's a verb, entrepreneurializing every member of an entrepreneurial company. We're bringing what happens between the entrepreneur and maybe a select few in the company in regard to the marketplace, and we're bringing that back stage. We're bringing entrepreneurializing back stage.
 
Steve Krein: Well, out of curiosity, if there was another tool that you would love to incentivize your team to complete, if you were to pick all the tools you use, appreciate, and is an unlock, what would be the other tool you would incentivize your team to use?
 
Dan Sullivan: Fast Filters, that when you want to communicate something to another person, put it in, I have an improvement that I want to suggest, this is the best result, this is the worst result, and this is five things that I think if we adapt this, it'll be good. For example, I adapted a policy myself 15 years ago that I will never ask for a meeting with you unless you get a Fast Filter, okay? If you want to have a meeting, I want you to think through really, doesn't take long, 15, 20 minutes. Tell me what it is and send it to me the day before, then I'll have a meeting with you. But if you just want to come in and delegate your thinking to me, I'm not going to do it. So I think that's a little tool. I don't want to push too far on this. I want people to really buy into it quarter by quarter, and then we'll see what other tools we can add to it. Some existing tools, some new tools, maybe.
 
Steve Krein: I was just interested in how you were thinking about respect and results you're expecting people to take responsibility for. Yeah. Dan, this is great. What was your biggest insight from the conversation?
 
Dan Sullivan: Well, first of all, if Steve Krein likes it, I think we're going to take a big jump. No, and I mean that seriously. Your ability to go deep and to really say, you know, this is really something new. You're telling me that this is significant is very important to me. Okay. But it's kind of like I've had a real education over the last 18 months with the patent process. You know, we had Keegan on as a guest. Their process is just so radically different from any other IP lawyer I've ever seen. But I'm starting to figure out the Patent Bureau. And what the Patent Bureau is looking for when they're looking at a possible patent, they're looking for a really good joke, okay? And what I mean by this, there's got to be a punchline to this. You know what I mean? A joke works because you're buying in, you're buying in, you're buying in, and then there goes whack. And I've discovered that if one of my tools doesn't have a punchline, it's not going to get a patent. And the punchline is, whoa, this changes things. So what's the punchline for 4x4? 4x4 is they really like it, you know, and what we've seen so people really, really like it. They like talking about what they wrote down on their sheet of paper. And all of a sudden they realize all my teamwork has just improved enormously. Okay. And not only that, but if I do an activity voluntarily, I will be rewarded for voluntary effort. And I think that's a different philosophy.
 
Steve Krein: Yeah. Excellent. Well, as I shared, but I'll rephrase or reframe, I think as you get older, Dan, and you live through many more cycles in the market and the different generations of entrepreneurs, you continue to bring the curiosity and the resourcefulness to the next generation's entrepreneurial challenges. And I think the idea that you're focusing on unlocking team friction or team alignment or team responsibility, pick any of those for the 4x4, I think is really fascinating. And I think the simplicity of it is actually almost maybe the beauty of it, which is just this concept was shared with Babs and your team on a Monday. And by Tuesday, they discussed it, came up with a strategy to execute it, and have a date to launch it. Speaks of the simplicity of entrepreneurial operations that are over-architected when they actually need to be the opposite, which is simplified, to make them accessible. So I think you did a fantastic job with this one. Thank you. All right. Always enjoy my conversations with you, Dan.
 
Dan Sullivan: Thank you, Steve.