"Review of The E-Myth Revisited"
This review is from: The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It (Paperback)
This book is a guide to success for small business owners. Gerber is
the founder of a consulting company for small businesses. In the
beginning of the book, Gerber cites the well-known failure-rate
statistics for small business: 40% fail in 1 year. Of those who survive
1year, 80% fail in 5 years, and of those who survive 5 years, another
80% fail. Over the years, Gerber has observed that the small business
owners who fail often share a number of characteristics, while those who
succeed do so not by luck, brains, or perseverance, but by taking a
different approach. This book explains the approach that is necessary
for a business to survive and thrive.
One of Gerber's most striking observations is that most small businesses are started by "technicians", that is people who are skilled at something and who enjoy doing that thing. (A technician can be anything from a computer programmer to plumber to a dog groomer to a musician or lawyer.) When these technicians strike out on their own, they tend to continue doing the work they are skilled at, and ignore the overarching aspects of business. Without clear goals and quantification benchmarks, they soon find themselves overworked, understaffed, and eventually broke. Worst of all, they may come to hate the work they do. Rather than owning a business, they own a job, and they find themselves working for managers who are completely clueless about how to run a business- -themselves.
The solution, Gerber argues, is for every business owner, especially the technician-owners, to balance their business personalities. According to Gerber, every business owner needs to simultaneously be an entrepreneur and a manager as well as a technician. The technician is the worker-bee, the one who produces the product. The manager makes sure operations and finances run smoothly and consistently. The entrepreneur formulates the goals, and steers the business in the direction needed to reach those goals. Of these three personalities, the entrepreneur is key- -without it, the technician will work himself or herself to death or bankruptcy. As the business grows, the business owner will need to draw away from the technician work and manager work and delegate this work, rather than abdicate this, to others.
For turning businesses around, or getting them off the right foot, Gerber suggests looking at franchises as a model. In comparison to the dismal rate of ordinary small-business start-ups, 75% of franchises succeed at 5 years. The reason they succeed is that they are set up so that any unskilled person off the street could walk in, buy a franchise, run all operations in the franchise, and have a fairly good chance of success. The product of franchise companies is a business model, not food, hotel rooms, etc. In order to meet this level of success, franchise companies have clear operations manuals, procedures, consistent sales approaches- -every detail of running the business is specified down to dress codes and wall paper.
By asking us to consider the franchise approach, Gerber is not saying to go out and buy a franchise license. Instead, he says to imagine that you want to sell your business as a successful franchise within a finite period of time. If so, what will you need to do regarding your business plan and management in order to meet this goal? That is, if you were going to make your business fool-proof so that any unskilled person could take over as owner after a few years and succeed with it, what will you need to do?
Overall, I found the ideas in this book extremely profound and incredibly useful for my own small-business venture. The writing style can be a bit wordy and choppy at times, which is the only reason why I did not give this book full marks. If you're a small business owner whose business is out of control, stagnant, or worse, or if you're thinking of going into business yourself, this book can be of immeasurable value.
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If you are thinking about going into business; you should read this book while you are setting up your plans and goals. It will help you determine where a lot of people go wrong in their initial planning of how they want their company to look like.
In beginning your business and setting your creative mind you need to be very careful because you might just get what you don't expect.
I hope that you get what you want and want what you get!
Click on the image to order the book!
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