I’ve seen many businesses that deserved to prosper, run out of capital and luck. Michael Gerber help explains why, and offers a constructive mechanism to maximize a business’s chance for success. The "e" (for entrepreneur) myth is that most people go into business for the wrong reason. They are skilled technicians - meaning they are technically competent in fulfilling the products or services to their customers. These technicians believe they will find more freedom in their business, but they discover it is the hardest job in the world, because there is no escape. They are the ones who are doing the work! They are the "business!" But if they are the business, they haven't really created a business at all, they have created a job for themselves!
According to Gerber, the role of the business owner is really quite different. The role of the business owner is to create a business that works independently of himself or herself. If that is the case, there is an "end point" where the business functions independently of the business owner. At that point, the business owner may choose to sell it or not, but he or she will have created a ready-to-sell "money making machine" for which he or she may choose the effort to devote to it. The business can also be duplicated from place to place.
The model for this effort is the "turnkey franchise," such as McDonalds. The franchise creator, Ray Kroc, made a uniform business with a certain look, providing a consistent experience to the customer. This was accomplished by establishing and documenting tested, detailed systems. The franchiser controls the design of the restaurant, sells uniformly made food and equipment, and provides the "scripts" for the service people and detailed procedures for preparing the food.
Likewise, the business owner should start with an idea of "what this business should look like." An organizational chart should be created (which could start with the business owner in each box) to document a business organization, with responsibilities as chief executive, marketing, accounting, finance, and production. Gradually, the business owner tests, measures and documents the procedures for each position and replaces himself or herself until he or she isn't really needed at all.
Finally, the business becomes like a game or learning place where each person finds satisfaction in performing his or her part to the best of his or her ability.
I highly recommend this book. Stop doing it, doing it, doing it. Learn how to go to work ON your business, not IN it. If you would like help implementing these ideas or if you’d simply like to find out more about them, please call us to arrange a meeting.
Again, I have a copy of The E-Myth in my office and I would be happy to let you borrow it.