“The E-Myth Revisited”
Why Most Small Businesses Don’t Work and What to Do About It
from The Business Owner.com 05/13 enhanced by Peter/CXO Wiz4biz
The E-Myth book series are some of the books most frequently recommended. The original E-Myth was first published in 1985. The E-Myth Revisited was published in 1995. These book are continually on lists of best business books. It’s on the required reading lists of business education classes taught at institutions of higher learning the world over, such as Stanford University.
Who is an Entrepreneur? Author Michael Gerber says: “Successful entrepreneurs tend to be open to learning new things. Always searching for knowledge. On a quest to get better every day. Ready to drop less productive methods for better ones”. He addresses what we all know — few businesses owners break through and find the quality of life, freedom & financial success they desire. But of considerable value is his reason why. “Most businesses are started by people with technical expertise”, he says. The entrepreneurial (“E”) myth is that technical expertise can provide a strong foundation to build a successful business on. In reality, success comes only by learning, and effectively implementing, certain proven techniques for growing & managing a business.
Is your Business running you? Many sources have said for years, that businesses should exist to serve their owners. Similarly, owners should not be slaves to their businesses. Gerber agrees, but he ALSO tells us HOW we can organize our business so we may be better served. So we can have a business and also a life. Gerber says the trick is to build the business so:
· Every job is Standardized, (ie, all job functions detailed in job descriptions & work instructions procedure
· Every person knows exactly what to say and do in every instance (because it’s detailed in a written procedure)
· Most tasks, even Managerial, can also be performed by the lower-skilled (and lower-cost) workers
Using the Franchise Model. The E-Myth says every business should be built as if it’s going to be franchised and the business owner must move from technician (& laborer) to leader. Gerber says operations should be standardized so each employee knows exactly what to do and when to do it, and so managers spend their time figuring out how to bring in new business. How? The business owner’s job is to determine which Marketing & Sales methods work best and standardize those, too. Standardize the Client Acquisition side of the business so that — just as the operating side — the lowest skilled workers can execute and deliver results.
The Success of the Franchise Model. Gerber says the greatest development in business in the past century is the development of the franchise model pioneered by McDonald’s. Gerber says that 75 % of franchises that open Franchise, survive past their fifth anniversary. Non-Franchise businesses — less than < 20 %. [Wiz4biz Note: doesn’t sound that sophisticated or dignified , but you can’t argue with what works] Comments: What do you think of the Franchise Model? What has been your experience?