Main Theme: Entrepreneurship, Leadership, Organization, Management
For People Who: Need A Fresh Approach to Leading An Organization or Business
I have seen The E-Myth Revisited by Michael Gerber on several reading lists and I finally got around to reading it. The E-Myth Revisitedis absolutely a ‘must read.’ Hands down, “Buy the book and read it” is the recommendation I have to give. As a member of a church-planting team, I wish I would have read it years ago before we started. It would have reshaped my role in the organization, what I did and did not do, what I chose to focus on and how I approached starting a church, which, whether you like it or not, is a lot like starting a business. I told my wife, “If you replace the word ‘small business’ with ‘church plant’ and ‘entrepreneur’ with ‘pastor’ this book would shoot off the shelves into the hands of pastors everywhere. Here is the biggest thing I’ll take away from The E-Myth Revisited:
Go to work on your business rather than in it…The problem isn’t your business; it never has been. The problem is you! It has always been you and will always be you. Until you change, that is. –The E-Myth Revisited, pg. 109-110
- If you want to build your organization, you can’t work in it. You have to work on it. If you are doing all the work then you will never have time or the effort to step back and see your organization from a greater perspective.
- There are three people within each of us: the Entrepreneur (the dreamer), the Technician (the doer), and the Manager (the planner). Most people start a new business as a technician – a worker who is tired of working for ‘the man’ and go out on their own. But they never stop being the technician. They work and work and work until they grow so tired of working that their new business becomes a curse rather than a blessing. Because they worked in their business and not on their business.
- Your organization reflects who you are inside. If you’re lazy, your organization will be lazy. If you’re disorganized, your organization will be disorganized. If you want your business to change, it has to start with you.
- If you want to do the work of your new business, then you should not start a new business. You should get a job at an already existing business. A successful business is one that can function without you doing the work.
- If you start something new, begin with the end in mind and then work backwards. What steps do you need to take to get you to that unfulfilled vision of the future?
- It’s your job as a leader to put in place the systems necessary for others to come in and work in the business with ease. It may be difficult to put these systems together, but that’s why you are the leader and they are not.
- Marketing isn’t about what you want or what your vision of the future is. It’s what your potential customers want that matters. If they don’t think they need what you have then all your marketing will be for not. Look at your current customers/attendees and see what people your organization naturally attracts and find out why.
(Disclaimer: There are over a dozen chapters in this book, so I will summarize large portions of the book under particular headings and big ideas.)
Part 1: The E-Myth and American Small Business
The Entrepreneurial Myth
The Fatal Assumption [of all technicians who go into business for themselves] is: if you understand the technical work of a business, you understand a business that does that technical work. –The E-Myth Revisit, pg. 12-13
Knowing how to do the actual work of a business is one of the greatest obstacles of an entrepreneur. Why? The Technician within all of us, the worker, the doer, goes to work doing everything that we love to do. But the problem is that we’re the boss now, which means we have a dozen other things to do at the same time. Things we never had to do before when we were just a worker in another person’s business. And because the Technician goes unchecked, and we go unchanged, we end up quitting our once joyous departure into the seas of entrepreneurship.
The Entrepreneur, the Manager, and the Technician
Gerber talks about the three personalities that all of us have within: the Entrepreneur (the dreamer), the Technician (the doer), and the Manager (the planner). “The Entrepreneur wakes up with a vision. The Manager screams “Oh, no!” And while the two of them are battling it out, The Technician seizes the opportunity to go into business for himself. Not to pursue the entrepreneurial dream, however, but to finally wrest control of his work from the other two.” (pg. 29) When that happens the business fails. Why? Because the wrong person is leading the charge.
“If I were to give the true entrepreneur in myself life, how could I totally change my experience of this business? –The E-Myth Revisited, pg. 33
Three Phases of a Business’s Growth
- Infancy: In this stage of your business “the owner and the business are one and the same thing…you are the business.” (35-36) Doing everything in the business isn’t having your “own” business, it’s just having a regular job with the worst boss in the world: YOU!
“If all you want from a business of your own is the opportunity to do what you did before you started your business, get paid more for it, and have more freedom to come and go, your greed…your self-indulgence, will eventually consume both you and your business.” -The E-Myth Revisited, pg. 41
- Adolescence: This stage begins when you start getting some help. The problem is, The Technician hires someone to take “less important things” off their plate so that The Technician within can concentrate on doing the work of the business. The problem is The Technician fails to let The Manager affectively organize. When values and objectives are not imported to new hires, you will end up doing their job for them because “it’s just easier if I do it.”
- Maturity: “A Mature company is founded on a broader perspective, an entrepreneurial perspective, a more intelligent point of view. About building a business that works not because of you but without you.” (pg. 65) A mature business is run by a leader who knows how the business is run and realizes it is less important to know what is actually being done.
Part 2: The Turn-Key Revolution: A New View of Business
The whole idea behind the Turn-Key Revolution is for you to turn your business into a prototype so that it can be replicated. Going to work on your business to create manuals and instructions on how to do everything within the business ensures that a customer has the exact same experience every time they walk through your doors. Ray Kroc figured this out when he franchised McDonalds. No matter where you go in the country you can order a Big Mac meal and have the same experience. Why? Because he didn’t work in the business, he worked on it. Creating systems and processes to ensure a repeatable experience. This is what all franchises do! When you are able to repeat the systems of your prototype, you can “turn the key” of a new business over to a new owner. In essence, you must realize it is not your product you are selling, it is your business you are selling.
For ordinary people to do extraordinary things, a system – “a way of doing things” – is absolutely essential in order to compensate for the disparity between the skills your people have and the skills your business needs if it is to produce consistent results. -The E-Myth Revisited, pg. 101
Part 3: Building a Small Business That Works!
Gerber lays out the seven steps necessary to building a Business Development Program in the third part of The E-Myth Revisited:
- Your Primary Aim: You are the most important part of your business. At the end of your life, what do you want people to say about you? Your Primary Aim “is the vision necessary to bring your business to life and your life to your business.” (pg 140)
- Your Strategic Objective: “This is a clear statement of what your business has to ultimately do for you to achieve your Primary Aim. It is the vision of the finished product that is and will be your business.” (pg. 149)
- Your Organizational Strategy: Create an organizational flow-chart of your business the way it will look in seven years. Which positions will their be? At the beginning, you fill in every slot. Create a system for that position so that anyone can step in and fill that spot and do it with the care and respect you would. As your business progresses into adolescence, someone will fill that spot, and you’ll move on to the next. Continually do this until you have an entire organization full of people who love the business as much as you do and care about what they do as much as you.
- Your Management Strategy: “It is a System designed into your Prototype to produce a marketing result. And the more automatic that System is, the more effective your Franchise Prototype will be.” (pg. 188)
- Your People Strategy: If we want people to do the work as lovingly as we would and as carefully as we would, we have to make sure “they understand the idea behind the work they’re being asked to do.” (pg. 201) If people don’t understand the ‘why’ behind the work, they will never love the work. Providing structure for them to work in helps provide focus. It shows them you take the work seriously. And if you don’t take the work seriously, then why should they?
- Your Marketing Strategy: In your marketing strategy you need to forget everything you think your customers want and figure out what they actually need. Then find a way to communicate that to them.
- Your Systems Strategy: Hard systems [the visual elements of your business], Informational Systems [the metrics of your day-to-day activity] and Soft Systems [written or verbal communication to anyone] all must be developed with intentionality. Because so far, the systems that have developed on their own are killing your business.
I found this book to be incredibly insightful and applicable to any business or organization. The reason is because principles of leadership and organization apply across the board to churches, small businesses, non-profits, start-ups, and corporations alike. As a pastor, there were several times I thought, “He is reading the Church’s mail!” Leaders struggle with many of the same issues. Struggling with The Technician, The Entrepreneur, and The Manager is a part of every leader’s life. But we must learn to balance between each of them because each play an essential role. Reading this book will help you see that balance and give a ton of practical direction for you and your organization. You won’t regret reading it. And neither will the people involved in your organization or the people touched by it.
Information and Personal Rating
- Title: The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It
- Author: Michael E Gerber
- Published: 2004
- 268 pages
Personal Ratings (1-10)
- Applicability: 9
- Readability: 8
- Originality: 9
- Recommendation: Yes – absolutely!