The E-Myth Revisited: How to Make Your Small Business Succeed
Make Your Small Business Succeed with "The E-Myth Revisited"
"The E-Myth Revisited" is a must-read for any entrepreneur who wants their small business to succeed. It was written by Michael E. Gerber, a small business consultant who noticed that the tiny percentage of small businesses that succeed all have certain things in common.
The E-Myth is the entepreneurial myth. So, what is the entrepreneur myth? The myth is that the way to beat the small odds of sucess when you start a business is simply through hard work and perseverance.
One of the things that Gerber points out is that most small businesses are started by "technicians"; a technician can be a plumber, a lawyer, a computer programmer, and so on. When these technicians decide to leave the company in which they work and strike out on their own, they have a tendency to continue concentrating on the work they're skilled at and ignore the "business aspect" of their new enterprise. That is, they basically create a job for themselves instead of really creating an actual small business.
The solution, says Gerber, is for business owners to balance their business personalities; they have to be an entrepreneur, a manager, and a technician. The technician produces the product or service, the manager makes sure operations and finances run smoothly, and the entrepreneur creates a compelling vision for the business, formulates goals, and steers the business toward the accomplishment of those goals.
Furthermore, Gerber suggests that a small business owner create a plan or business model as if they were going to sell franchises of their business at some specific future date, even if they never intend to do so. A large percentage of franchises--seventy five percent--succeed. Franchises have procedures, clear operation manuals, a consistent sales approach, and so on. They are set up so that pratically anyone can walk up off the street and run it. This is the goal that you should set for your small business; you want to create a system and the continually improve it.
This book will liberate you from being a slave of your business to actually being a business "owner". To fnd out more about "The E-Myth Revisited", continue reading this lens.
The E-Myth is the entepreneurial myth. So, what is the entrepreneur myth? The myth is that the way to beat the small odds of sucess when you start a business is simply through hard work and perseverance.
One of the things that Gerber points out is that most small businesses are started by "technicians"; a technician can be a plumber, a lawyer, a computer programmer, and so on. When these technicians decide to leave the company in which they work and strike out on their own, they have a tendency to continue concentrating on the work they're skilled at and ignore the "business aspect" of their new enterprise. That is, they basically create a job for themselves instead of really creating an actual small business.
The solution, says Gerber, is for business owners to balance their business personalities; they have to be an entrepreneur, a manager, and a technician. The technician produces the product or service, the manager makes sure operations and finances run smoothly, and the entrepreneur creates a compelling vision for the business, formulates goals, and steers the business toward the accomplishment of those goals.
Furthermore, Gerber suggests that a small business owner create a plan or business model as if they were going to sell franchises of their business at some specific future date, even if they never intend to do so. A large percentage of franchises--seventy five percent--succeed. Franchises have procedures, clear operation manuals, a consistent sales approach, and so on. They are set up so that pratically anyone can walk up off the street and run it. This is the goal that you should set for your small business; you want to create a system and the continually improve it.
This book will liberate you from being a slave of your business to actually being a business "owner". To fnd out more about "The E-Myth Revisited", continue reading this lens.
Important!
Gerber cites the well-known failure-rate statistics for small business:
- 40% fail in the first year;
- Of those that survive the first year, 80% fail within 5 years;
- Of those that survive 5 years, another 80% fail.
Visit the E-Myth Blog.
The E-Myth Revisited
The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It
Amazon Price: $8.86 (as of 02/17/2012)
You love baking pies and you're really good at it. So you decide to open a pie-baking business. Once your business is up and running you concentrate the bulk of your efforts on doing what you love: baking pies.
However, you let other vital aspects of your business fall by the wayside and soon you're having cash flow problems, you're working around the clock, and you don't have enough customers because you don't have a solid marketing strategy in place. Despite all of your pie-baking skills and your hard work, your small business is fledging.
Gerber advises in "The E-Myth Revisited" that the solution to the problem above--which is one that many small business owners face--is to consider the business to be a prototype for a large number of franchises that will be added at a later stage.
By adopting that mindset, the business owner will not only participate in the business as a technician but will also act as a manager (putting systems in place and controls) and as an entrepreneur (having a vision of how the business can create sustainable added-value for all key stakeholders).
A business that is built and managed by someone who combines the approach of the technician, the manager and the entrepreneur will have a far greater chance of future success than one guided by someone thinking like a technician alone.
“Stop working in your business and start working on your business.”
Excerpt from Chapter One
The Fatal Assumption
In the throes of your Entrepreneurial Seizure, you fell victim to the most disastrous assumption anyone can make about going into business.
It is an assumption made by all technicians who go into business for themselves, one that charts the course of a business--from Grand Opening to Liquidation--the moment it is made.
That Fatal Assumption is: if you understand the technical work of a business, you understand a business that does that technical work.
And the reason it's fatal is that it just isn't true.
In fact, it's the root cause of most small business failures!
The technical work of a business and a business that does that technical work are two totally different things!
But the technician who starts a business fails to see this.
To the technician suffering from an Entrepreneurial Seizure, a business is not a business but a place to go to work.
So the carpenter, or the electrician, or the plumber becomes a contractor.
The barber opens up a barber shop.
The technical writer starts a technical writing business.
The hairdresser starts a beauty salon.
The engineer goes into the semiconductor business.
The musician opens up a music store.
All of them believing that by understanding the technical work of the business they are immediately and eminently qualified to run a business that does that kind of work. And it's simply not true!
In fact, rather than being their greatest single asset, knowing the technical work of their business becomes their greatest single liability.
For if the technician didn't know how to do the technical work of the business, he would have to learn how to get it done.
He would be forced to learn how to make the business work, rather than to do the work himself.
The real tragedy is that when the technician falls prey to the Fatal Assumption, the business that was supposed to free him from the limitations of working for somebody else actually enslaves him.
Suddenly the job he knew how to do so well becomes one job he knows how to do plus a dozen others he doesn't know how to do at all.
Because although the Entrepreneurial Seizure started the business, it's the technician who goes to work.
And suddenly, an entrepreneurial dream turns into...
(You can read all of chapter one of "THe E-Myth Revisited here.
It is an assumption made by all technicians who go into business for themselves, one that charts the course of a business--from Grand Opening to Liquidation--the moment it is made.
That Fatal Assumption is: if you understand the technical work of a business, you understand a business that does that technical work.
And the reason it's fatal is that it just isn't true.
In fact, it's the root cause of most small business failures!
The technical work of a business and a business that does that technical work are two totally different things!
But the technician who starts a business fails to see this.
To the technician suffering from an Entrepreneurial Seizure, a business is not a business but a place to go to work.
So the carpenter, or the electrician, or the plumber becomes a contractor.
The barber opens up a barber shop.
The technical writer starts a technical writing business.
The hairdresser starts a beauty salon.
The engineer goes into the semiconductor business.
The musician opens up a music store.
All of them believing that by understanding the technical work of the business they are immediately and eminently qualified to run a business that does that kind of work. And it's simply not true!
In fact, rather than being their greatest single asset, knowing the technical work of their business becomes their greatest single liability.
For if the technician didn't know how to do the technical work of the business, he would have to learn how to get it done.
He would be forced to learn how to make the business work, rather than to do the work himself.
The real tragedy is that when the technician falls prey to the Fatal Assumption, the business that was supposed to free him from the limitations of working for somebody else actually enslaves him.
Suddenly the job he knew how to do so well becomes one job he knows how to do plus a dozen others he doesn't know how to do at all.
Because although the Entrepreneurial Seizure started the business, it's the technician who goes to work.
And suddenly, an entrepreneurial dream turns into...
(You can read all of chapter one of "THe E-Myth Revisited here.
Important!
The Three Personalities
The Technician is the doer, the builder, the labourer. For emerging businesses the technician is usually the most visible character. However, if you let the technician take over the business, this will result in burn-out and business failure.
The Manager does the planning and creates order.
The Entrepreneur is the visionary. He likes to play "what-if" and "if-when" games. He is the creative department of the business and is always on the lookout for new, innovative things.
The Manager does the planning and creates order.
The Entrepreneur is the visionary. He likes to play "what-if" and "if-when" games. He is the creative department of the business and is always on the lookout for new, innovative things.
Here Are My Last Five Blog Posts
Fetching RSS feed... please stand byInnovation
Quantification
Orchestration
More Books for Small Businesses
Links for "The E-Myth Revisited"
- Eight Page Summary of The E-Myth Revisited
- Sumarries.com is a concentrated business information service. Every week, subscribers are e-mailed a concise summary of a different business book.
- Free Summary of The E-Myth
- Ever wonder why most small businesses-- no matter how huge effort they put in their endeavor--still fail? Micheal Gerber reveals the answers in this book. Accordingly, the future of small businesses revolve in only three philosophies: the e-myth (entrepreneurial myth), the turn-key revolution, and the business development process.
- Coach Kevin's Summary of The E-Myth
- There are many books that people say you "should read". If you are currently running (or would like to be a partner in) any other business, you must read the E-Myth or the E-Myth Revisited (updated version) by Michael Gerber.
- Summary by Super Coaching
- The discussions revolve around the philosophies that could make or unmake the future of small businesses. These philosophies are: entrepreneurial myth (e-myth), the turn-key revolution and the business development process.
Important!
The best small businesses have processes in place so that they can run smoothly even when the owners aren't around.
More Lenses on "The E-Myth"
“The entrepreneur builds an enterprise; the technician builds a job.”
Michael Gerber: The Four Mind-Sets of an Entrepreneur
Get your sales system right, get your lead generation system right, and get your lead conversion system right. In addition, have a system in place to convert buyers into repeat customers.
In every entrepreneur there's a dreamer, a thinker (takes the dream and forms a structure around it), the story-teller or performer, and a leader.
In every entrepreneur there's a dreamer, a thinker (takes the dream and forms a structure around it), the story-teller or performer, and a leader.
Quotes by Michael Gerber
- "The entrepreneur is our visionary, the creator in each of us. We're born with that quality and it defines our lives as we respond to what we see, hear, feel, and experience. It is developed, nurtured, and given space to flourish or is squelched, thwarted, without air or stimulation, and dies." -- Michael Gerber
- "If your thinking is sloppy, your business will be sloppy. If you are disorganized, your business will be disorganized. If you are greedy, your empoyees will be greedy, giving you less and less of themselves and always asking for more." -- Michael Gerber
- "The entrepreneur in us sees opportunities everywhere we look, but many people see only problems everywhere they look." -- Michael Gerber
- "The entrepreneur is not really interested in doing the work; he is interested in creating the way the company operates. In that regard, the entrepreneur is an inventor. He or she loves to invent, but does not love to manufacture or sell or distribute what he or she invents." -- Michael Gerber
- "If they don't fail outright, most businesses fail to fully achieve their potential. That's because the person who owns the business doesn't truly know how to build a company that works without him or her.. which is the key." -- Michael Gerber
More Books by Michael Gerber
Entrepreneurship Articles
Michael Gerber
The Three Biggest Mistakes Small Business Owners Make
- They don't have a vision for their company. Because they don 't have a vision, they're not clear on what it is that they're compelled to do. If the company doesn't have a vision it becomes work- centric instead of being vision-centric. Here's a quote from Gerber: "A business without a dream is like a life without a purpose."
- They don't understand the difference between the work of the manager and the entrepreneur. The manager invents the system through which the entrepreneur's system will be manifested.
- The technician does the work by becoming a master of the system. There has to be a system and a vision or they're extraordinarily busy without having a clear vision of where they're going or how they're going to get there.
More Articles on Being an Entrepreneur
- Three Myths About Starting Your Own Business
- Many people dream of shedding the corporate life and starting their own companies.
- How 20 Business Ideas Were Hatched
- You know you want to start a business-but you're not sure exactly what that business should be. Fear not. While some lucky entrepreneurs do get a flash of inspiration that sets them on the path to success, others need to hunt for the right idea.
Follow Me on Twitter
This UpMarket page written by
Marelisa
Marelisa
Hi, I'm Marelisa Fabrega. I blog over at Abundance Blog at Marelisa Online.
I hold a Bachelor of Science in Business Administration from Georgetown...
more »
Deluxe. Remarkable. Creative. Unusual. Successful. Upmarket businesses push the envelope -- does yours?
Connect with UpMarket
This author recommends...
-
The Top 10 Reasons Startups Fail
Research by the U.S. Bureau of Labor Statistics shows that nearly six in ten bus... -
Female Internet Gurus
Most leaders in making money online are male, yet there's now a surging forc... -
Start Your Own Blogging Business: a How to Build a Blog Guide
Start Your Own Blogging Business, from Entrepreneur Magazine's Startup Series, i... -
Midlife Career Change Tips and Advice
So you're not happy with your current occupation and are considering a career ch... -
★ Business Success Stories | Dragons' Den UK | Most Successful Entrepreneurs & Inventions ★
< This guy is Levi Roots, probably the most famous face from all of the entre... -
Starting Your Own Internet Business: A Step-by-Step Guide
Start Your Own e-Business, from Entrepreneur Magazine's Startup Series, is a com...
