Never before, have so many people entertained the idea of starting their own business . The book.
- The E-Myth came out in 1985 and became an underground bestseller, with over a million copies sold. The initial edition became quite hard to get, but luckily Gerber brought out a new one, The E-Myth Revisited, containing a new Preface and revised material but with the same powerful messages. Few people have done a better job of presenting the anatomy of a small business, including what people really do in them and what they really earn from all their efforts. Gerber learned from his consulting work that people in small businesses generally work far too much for the return they get. The ‘tyranny of routine’ means that there is never time to take an objective overview of what they are doing. His book aimed to be a friend to those stuck in the quagmire. The book proceeds partly through a running dialogue with a woman Gerber worked with, ‘Sarah’, a pie shop owner whose problems and challenges perfectly encapsulate those faced by the most people going into business. Specifically, the book is a recipe for putting yourself back in control of your working hours – in short, to be able to work on your business, not in it. Business as self-development The surprising message of the book is that going into business is as much about who you are and who you want to be as a person, as it is about the business itself. If you are disorganized or greedy, Gerber says, or if your information about what is happening in your business is not good, your business will become a reflection of these things. If your business is to thrive, it will engage you in a process of constant personal development. For it to change, so will you. Gerber quotes Aldous Huxley: “They intoxicate themselves with work so they won’t see how they really are”. If you start a business with full knowledge of what it means to you and why you are doing it, it can be a wonderful experience. Go in blindly, and it can be – as many discover – a nightmare. The myth of the entrepreneur The ‘e-myth’, Gerber notes, is the belief that anyone who starts a small business is an entrepreneur. Yet entrepreneurs in the heroic sense of a Herculean wealth creator are actually quite rare. Most people simply want to create a job for themselves and stop working for a boss. Their thinking goes, ‘Why should my boss earn lots of money from what I am doing? The problems begin because this person may know a lot about their specialty, but nothing about business itself. After the initial exhilaration of the start up, they realize they have become the boss (of themselves), and are soon exhausted and demoralised. Knowing their specialty inside out has not prepared them to run a business – in fact, it becomes a liability, since they become unwilling to hand over the work reigns to anyone else. As Gerber puts it: “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.” He discovers he must become three people in one:
The Technician – the person actually doing the work itself The Manager – making sure everything is organized, pushing the Technician to ensure goals are met The Entrepreneur – the visionary or dreamer charting the overall direction of the company.
Each of these selves does battle with the other, and most people have a lopsided balance within them. The most common breakdown of someone who starts a small business is 10% entrepreneur, 20% manager and 70% technician. How things go wrong
Michael tells Sarah. Gerber notes. not doing business.” Watson had a template or vision and each day it tried to fashion the company after it. is not how small her business could be. you realize. This point. When Sarah’s pie shop begins to come apart at the seams. It is not to be ‘free of a boss’. A small business in its infancy is easy to spot: The owner is doing everything or trying to do everything. This is a relief. Gerber suggests. The first thing to do if you take the bolder route. In fact. is possibly the most dangerous for a small business. Most small businesses believe they will grow through hiring brilliant people – managers that can take the business to a new level. is to crystallize where you want to go with the business and write this goal down. not in it. founder of IBM is quoted: “I realized that for IBM to become a great company. Gerber suggests. “Every day at IBM was a day devoted to business development. The key question. The Technician’s only model for his business is work. Most great companies set out with a vision of where they wanted to go. This may seem a cold way of
. when an owner does not want to move out of their comfort zone involving them being in control as the Technician. she thinks that making more and better pies will sort things out – it won’t. Though McDonald’s founder Ray Kroc loved the food. he writes. begins differently than the rest. just get the product out the door! No one. after all. Taking the bolder route It does not have to be this way. Gerber forces her to ask: Is it a system that works irrespective of who is working in it? Or is it just a place where a lady makes pies and tries to sell them? The familiar pattern of a Technician who has started a business. simplicity. it had to act like a great company long before it ever became o ne. is this: exhilaration. they have to employ someone else. The owner’s morale dips. but how big it could naturally become with the right systems and organization in place. But with the business growing. The brilliance of the concept is not simply the food. They are the only person whoknows how to do everything. He had a picture in his mind how the company would look and be “when it was finally done”. What they once loved most – their work – they begin to hate. Such a shrinking back is a tragedy. It’s the system Gerber mentions McDonald’s as the perfect example of a business that ‘worked’. He is amazed how few small businesses actually have written goals. exhaustion. but rather to go further in your field than you could just working for yourself – to create something great out of your life’s work that makes a difference. Tom Watson. and despair. and the business is thrown into chaos again. work harder – forget about any long term goals. Gerber says. he loved even more the beauty of the system that the original McDonald brothers had developed: its speed. This paradox is summed up in Watson’s remark. the work is secondary. whereas for the Entrepreneur. and which naturally requires more organization and resources. organization and general panic that clouds the way most enterprises are run? A mature company. But at some point this person decides to leave. but the system that could be replicated thousands of times over. The owner’s answer is to do more. now they don’t have to think about that aspect of the business they didn’t like anyway (more often than not. not by individual people. it is doing ‘the books’). and order. and eventually the business dies because of its natural limits. however farfetched it seemed. but by the system itself . yet “any plan is better than no plan”. so it must stay at a size so that you can do all the work.ways of operating that guarantee a customer is satisfied. should we be surprised at the lack of direction. followed by terror. What you really need is idiot -proof systems and procedures that enable merely good people to do extraordinary things . can do the work like you do. What she needs is to step back and look at the business as a business. the model is the business itself. Gerber tells Sarah that “…the purpose of going into business is to get free of a job so you can create jobs for other people”. this is a ‘hit and miss’ way of doing things.The problem of the Technician is that he or she believes that the answer to every problem is to work harder. Without such a goal or plan.” This again is Gerber’s message: work on your business.
Gerber’s book can get almost mystical at times. I am a master craftsman in what I do! But Gerber responds: what does a master craftsman do when she has learned all there is to know? Passes it on to others. because it is ultimately about who you are and where you want to go in life. As a self-confessed former poem-writing hippie. Franchising rests on the understanding that “The true product of a business is the business itself”. The more you standardize and refine the machine. giving a sense of camaraderie and order that would otherwise missing. both to customers and employees. Creating a world of order You have to orchestrate. but this should be forgiven in the context of its powerful messages. and as a result the customer gets what they want all of the time. You may say. against all the odds. Gerber notes.000 exactly like it. Orchestration through a business system leverages what you know. Echoing his first principle of business success. A great business can fill both holes. systems and accountability. Wait for the interesting twist at the end. which shows why it is so important to be clear on exactly what you are selling. It is your mastery writ large. but anyone who has been delighted by the way a hotel or a restaurant is run will understand the distinction. Gerber calls franchising the ‘turnkey revolution’. you don’t have to worry about finding extraordinary ones. Another chapter contains the intriguing story of a person who. quite an addictive read. Would the extension of her ideas and philosophy to such a grand scale mean she would have ‘sold out’? Or would she feel that it was the natural expression of a system she had lovingly built and that deserved to be replicated? The success of The E-myth is partly owed to the fact that it coincided with the boom in business franchising. Gerber notes that “Great people have a vision of their lives that they practice emulating each and every day. With proper standards. given its subject. not just in their lives.looking at it. because the only certainty in your business is that its staff will act unpredictably.
. A business is like a machine that generates money.an island of purposeful calm in an otherwise disorderly world. Gerber remarks. I can’t work out standards. your skill can be multiplied many times. The chapter on marketing. feel either a lack of purpose in their lives or a sense of isolation from others. providing a ‘fixed point of reference’ . the clearer its value will be. They go to work on their lives. is worth the price of the book alone. though you can do very well buying a franchise. not about business. in that it allows someone to buy the right to use a business system in which all they have to do (with some capital and a reasonable amount of work) is to ‘turn the key’ to get it going and become profitable. Final word Gerber asks Sarah to imagine how her business would be run if it was the model for 5. organize and standardize your business down to the smallest details. It brings more life. It is. Most people. In fulfilling this duty. If you can build a great business around ordinary people. became a success story. However. and this has been a key to the book’s success. What is surprising is his injection of a spiritual sensibility into what is a essentially a business title. you cut out that risk.” The E-myth Revisited can be a bit self-promoting at times. you can do even better by starting some kind of business system yourself – as Sarah begins to realize. this is no surprise. quoting the likes of Carlos Castaneda. Robert Assagioli and Zen writers such as Robert Pirsig.