I recently decided to give in to pressure from friends and mentors and read Michael E. Gerber’s The E Myth Revisited – Why Most Small Businesses Don’t Work and What to Do About It. The book is a worldwide best seller and had been recommended to me time and time again. I’m not sure why I waited this long but it was well worth the read. I enjoyed the book immensely and there were some key points that made so much sense.
We’ve all heard the saying ‘work on your business, not in it’. This may have been the man, and the book, that coined the phrase. The E-Myth (Entrepreneurial Myth) is designed to teach entrepreneurs how to get their businesses to run without them being there all the time. Teaching them how to systemise their business and empower their team so that the business runs, essentially, on autopilot.
The ‘Myth’ the book speaks of is that businesses are started by entrepreneurs who are seeking to make a profit. The reality is that most small businesses are started by technicians (employees) who decide they would rather be self-employed. The problem with making the decision to start a business based on a desire to no longer ‘have a boss’ is that the technician understand the technical work, not the business itself.
As a former Tradesman myself I have seen this time and time again and Gerber’s analysis really struck a nerve looking back at the businesses my family have owned and operated over the years. Apprentices leave their employers everyday because they are now ‘qualified’. According to the relevant governing bodies they’re technically proficient at whatever it is they do. Many quickly learning that being a good tradesman is very different to being a good business owner.
Three people living inside all business owners
Gerber explains that we’re all composed of 3 personalities. For your business to succeed, you must play each role:
1. The Entrepreneur: a future-focused visionary who pursues opportunities;
2. The Manager: a past-focused worrier who plans and organizes; and
3. The Technician: a present-focused worker who concentrates on the task at hand.
Allowing one of these personalities to dominate the other two will, ultimately, be detrimental to the business and its owner.
The Franchise Prototype
My biggest take away from the book was the concept of approaching a business from a franchise perspective. Build any business, regardless of your actual intentions, as if it were the prototype to be replicated time and time again.
Why would you build a business ready to be franchised even if you have no intension of franchising it? For one simple and powerful reason, it makes you work on your business as if it is a product you must refine to be the best it can be:
– It’s processes are as efficient as possible;
– Everything the business does is tested and documented; and
– Your customer’s experience (once perfected) can be replicated on every occasion by team members with minimal skill and experience.
By working on your business in this manner you are creating a business that’s results are system-dependent, rather than people-dependent. You no longer have to be the expert in every area of your business. The system makes everyone in your organisation any expert in their area by removing discretion and perfectly mapping out ‘best practice’. Best practice can be replicated time and time again without any risk to your customer’s experience and you don’t need to be there to supervise.
If your business is completely dependent on you to function, you don’t own a business, you own a job. A job that will ultimately make you regret your decision to ever start it. A monster that will consume every hour of your day (and probably every dollar you have) unless you change your approach to it.
I’d recommend Michael E. Gerber’s The E Myth Revisited – Why most Small Businesses Don’t Work and What to Do About It to anyone currently in business or considering making that move so many ‘technicians’ make.