The E-myth revisited
After Vince’s book review of the MacDonald’s Franchise system, I thought that I would make a review of « The E-Myth revisited » by Michael E. Gerber, who sees the « Franchise mind » as a key success factor for small businesses. It is quite an old book, but I have been amazed by the simplicity and the truthfulness of how the author describes the mind of a business owner.
The author describes the entrepreneurial myth as 1) the myth that most people who start businesses are entrepreneurs, 2) the fatal assumption that an individual who understands the technical work of a business can successfully run a business that does technical work.
He says that almost every business starts with a Technician (somebody with a great ability, for example baking pies) having an “Entrepreneurial seizure” (“it would be so much better to do it for me!”). But in each business owner, there are 3 different people with different interests: the Technician, the Manager and the Entrepreneur.
Whereas successful businesses are owned by people having “the Entrepreneur” in them shaping a vision which will lead the company to succeed, most businesses are owned by people who are Technician at 70%. They are people who have started their business thinking that by this way they will be able to dedicate entirely to what they love, without knowing that being a business owner requires many more skills.
For a Technician to develop his Entrepreneur side, he needs to think about the business as a Franchise (named the Turn Key revolution) as if he had to build a business which would have to seduce potential franchisees not for the product the business is selling but for the perfect functioning of the business itself. He has to create a Prototype business, as though it was the model for 5,000 more just like it.
I really think that Gerber has understood the psychological brakes which prevent owners from creating efficient businesses:
- Owners focus on the product rather than on the business
- Owners build a business based on their talent and personality rather than on processes, which makes impossible to grow the business or to create others on the same model
- Owners go to work in their business rather than on it
Fidji is not at all a reference in entrepreneurial success, but her mistakes make her believe that she can talk about it. You can discover her in her initial announcement or on her blog.
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[...] and I have done in our businesses. I have made a more detailed review of this book on Tech It Easy here, and I strongly invite you to read it, but in a few words, the psychological brakes which prevent [...]
We should maybe open a Tech IT Easy Zlio shop so that we at least make some money on these recommendations.
It could be Zlio or it could be U.[Lik] as well, an eCommerce recommendation company as well.
What do you think Fidji?
Definitely! Personally I love U.[Lik] but I haven’t tried Zlio yet, so both are fine with me… It would be better than increasing Amazon turnover for free
Anyways it is a really great book, but please wait until we create our Zlio or U.[Lik] shop to buy it…
Wow, this sounds exactly like what I’m seeing at a distance happening in a start-up my friend is (less and less) involved with. It’s technicians all around, but the main Technician seems to have a vision. Too bad the company seems to built around his talent and personality.
Fidji, what’s the function of Manager in that trio? You only mention the two others in your post. I think I have guess, but maybe other readers would like to know too what Gerber thinks.
Haven’t started the business yet, but I quite recognize myself in the technician portrait. Might (or should) read this book !
@Kari: The Manager is an intermediarystage between the Technician and the Entrepreneur, but an excerpt is better than my words: “The managerial personality is pragmatic. Without The Manager there would be no planning, no order, no predictability. (…) Without The Manager there would be no business, no society. Without The Entrepreneur, there would no innovation. It is the tension between The Entrepreneur’s visionand The Manager’s pragmatism that creates the synthesis from which all great works are born.”
@Xu: according to Gerber, you really need all the 3 aspects, but The Entrepreneur is the most difficult to get as it requires a global vision, not to be stuck into the basic daily necessities of your business. By the way, the consulting firm “The Emyth worldwide” seems to have applied this method to a lot of small businesses and to have had really good results, but it is less expensive to buy the book than to hire them for a consulting mission
[...] of an entrepreneur from a psychological point of view, and how it translates operationally, just buy The E-myth revisited. But if you want something more inspirational, a story on entrepreneurship rather than a business [...]
[...] Fidji Simo wrote in her review before, Gerber suggests treating your business as a franchise, coding everything possible to make [...]
[...] “The E-Myth Revisited,” by Michael Gerber, which I’ve written about extensively before, and which deals with developing a type of franchising approach regarding the starting and running [...]