Customer Reviews

The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It

5 star:		(86)
4 star:		(28)
3 star:		(10)
2 star:		(8)
1 star:		(4)

 

 

Pros: Easy read, exposes pitfalls, many helpful ideas and many paradigm shifts, excellent!
Cons: Challenging concept for my business of one. No Index.

This is an easy read that took me two days to get through. It's simple, repetitive and just the way I like it. But by no means simplistic. To me, it is well written, when the author gets their ideas across quickly and makes them seem easy. The book gets personal about the author as it tries to relate itself to the reader, yet shows a sense of writing maturity in it's simple delivery of so broad a topic. It also gets personal about you as you discover that your business is a reflection of you.

A mixture of experience and facts, blue prints and rules told in a conversational story with a semi-fictional character. This style of using a third party character to clarify and reinforce the ideas worked well with me. It helped balance and pace the lessons with a fine sense of timing and added perspective. The book is informational, motivational and even funny at times.

Gerber sets the stage by prefacing the four ideas that are the basis of the book's lessons. He identifies and compares three personalities being The Entrepreneur, The Manager and The Technician in us and shows us how and why most businesses fail. He identifies phases of the entrepreneurial business as infancy, adolescence and maturity and the pitfalls of each. He covers six rules on how to shift from working 'in' your business to working 'on' it. And goes over the three activities to help it evolve being, Innovation, Quantification and Orchestration, systems to blueprint your business. He covers the Business Development Process and to think of how to turn it into a franchise that is a saleable Turn-Key business. He then explains the seven steps to developing your business, which he covers in detail but some didn't inspire my confidence, as they are large subjects in themselves. Like, 'Your Marketing Strategy' or Your People Strategy'. But they do develop a framework from where to start and the questions to ask yourself. He constantly helps focus us by asking excellent thought and direction provoking questions.

The book packed with many useful ideas and principles if you decide to buy into them, however is also a way for him to sell his services. By occasionally positioning his company or website as a source of answers to some of the questions the book poses is a great form of self-promotion, however they may be disguised in a story. Some thoughts that came to mind while reading were, why not just find and utilize a mentor? Success leaves clues. I struggled with the though that all businesses are started with one thing in mind and that is to sell it for a profit. The book has many paradigm shifts like this one that challenge us to look at our companies in a different light. Only when I realized that I didn't have to sell my business (If I happened to build an IBM) did I understand the idea. I'm still struggling with finding a compelling vision of how to turn my particular service business of one into a salable entity. Maybe I need to visit his website and enlist in the services he offers. Maybe I just need to find a few successful role models within my business. I will read it again in a few weeks.

I would have liked to see an index in the back to help find needed references quickly. Maybe a future publishing might get one?

A healthy experienced perspective and a plan to help build a successful business life.

I recently re-read E-Myth and E-Myth revisited by Michael Gerber (www.e-myth.com). His thesis is to work on the business, not in the business. He is a big believer of systematizing and documenting processes. Dumbing things down so anyone can do them.

Although the primary thrust of his books are targeted at small business (and since I started my business from 0, I am a bit of a small business person despite running the Billion dollar company), there are some gems for larger businesses as well.

It speaks to scalability. Creating a system that can grow and does not require any specific person in order to do this. Then polishing the system at every opportunity to make it better.

What I am finding in the current polishing is that the adaptability of the people is a key trait. People tend to be the barrier to new systems. The adaptable ones will thrive. Part of what I need to do is to also moderate some of the change in order not to break a good thing. Although we need to change - we also need stability. It is that balance that I seek.

Views from a larger company CEO Blog, April 10, 2006

I recently re-read E-Myth and E-Myth revisited by Michael Gerber (www.e-myth.com). His thesis is to work on the business, not in the business. He is a big believer of systematizing and documenting processes. Dumbing things down so anyone can do them.

Although the primary thrust of his books are targeted at small business (and since I started my business from 0, I am a bit of a small business person despite running the Billion dollar company), there are some gems for larger businesses as well.

It speaks to scalability. Creating a system that can grow and does not require any specific person in order to do this. Then polishing the system at every opportunity to make it better.

What I am finding in the current polishing is that the adaptability of the people is a key trait. People tend to be the barrier to new systems. The adaptable ones will thrive. Part of what I need to do is to also moderate some of the change in order not to break a good thing. Although we need to change - we also need stability. It is that balance that I seek.

This book deserves 7 stars for pointing out the fallacies of how most entrepreneurs operate. The book deserves 1 star for proposing a standard that most people cannot hope to meet and then pushing to sell you consulting services. Pay attention to the former, and go light on the latter.

Gerber is correct that most entrepreneurs are limited by a comfort zone of wanting to remain in control as either strong technicians or managers, which limits the potential of the business. As soon as they exceed what they can handle, the business either fails in a break-out attempt or shrinks back to a simpler state. The new businesses that succeed the most are the ones that have a business model that is easy to replicate with ordinary people.

Where Gerber goes wrong is in suggesting that many people can develop such business models. I regularly study the top 100 CEOs in the country for stock-price growth, and few of them think they can develop a new business model. Why should someone starting up a new company be likely to do better than that? They won't. In fact, I have a friend who attempted to start a new business following Gerber's principles and almost failed before he adjusted to normal operating approaches. He spent so much time developing his business model, that he never got around to operating it.

Gerber's three favorite examples are McDonald's, Disney, and Fed Ex. Notice that two of the three got most of their ideas from someone else for the business model (Ray Kroc from the McDonald brothers in San Bernardino, California and Fred Smith from an Indian air freight operation).

I think there is another fallacy here: You can get ordinary people to do simple things (deliver packages, cook and deliver cheap hamburgers, and smile at people on automated rides). But in many businesses the demands of the market are extraordinary such as in many technological product businesses and services. Microsoft has a business model, but it is not one that Gerber would recognize.

Finally, he condemns people who want to operate their business as a job by being technically expert. Where would we be if people never did that? What if Peter Drucker spent all of his time developing business systems to make pizzas and tacos rather than writing business books about management? What if great musicians developed business models for teaching children to play the violin and piano rather than performing? In other words, there is room and a need for extraordinarily able one-person companies run by technicians.

Skip the pitch for the consulting services at the end. You'll like the book better if you do.

But don't let my quibbles keep you as an entrepreneur from failing to appreciate the excellent case Gerber makes for having a business model as soon as possible, and working systematically to improve it. If you can do that, you may well develop a true irresistible growth enterprise.

I've read this book once and I'm going to read it another time (to write notes). I've reccomended it to several of my friends and family (I'm reordering because it's hard to get it back from them). If you want to have a business work for you and not for you to work for it, READ THIS BOOK!

It's one of those books that gives you a wake up call, although some of the sections in the book does tend to wander off into the story of other peoples lives as examples, but overall the book does wake you up, I did gain alot of perspective from the book, funnly enough I did email the e-myth website to find out if they provided any e-learning services, but no reply till today for the past 2 weeks, makes you wonder??

A must buy book for anyone getting into the business especialy for some of us that have dealt with situations where you seem to be unable to cope with all the sudden increase of business and how to deal with them, do keep in mind that this book is very down to earth, and do keep in mind that you would require some sort of business background if you ever going to be starting a business, a recommendation as a subject of choice would be accountanting so maybe an accounting abc manual would be a good reference manual in the future in addition to this book. This book is not going to save you but will for sure open your mind.

On the cover it says 'why most small businesses don't work and what to do about it'.

If you want to learn more about creating a successful business you cannot fail to learn from this book. Your attention is drawn to the distinction between working in your business and working on your business. As you work more on your business you will begin to experience the benefits of a 'turn-key' business.

I didn't read all the way through "The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It" by Michael Gerber. I stopped reading at about page 100. "E-myth" stands for "entrepreneurial myth." Gerber makes the accurate point that just because a person understands the technical work behind a business doesn't imply that the person understands that kind of business. People who understand the technical work don't necessarily understand how to operate the business. They are technicians, not entrepreneurs.

Gerber contends that most small business owners run into difficulty because they think and work like technicians. They try to do the work of the business, rather than learning how to run the business. Gerber writes, "If your business depends on you, you don't own a business-you have a job." "What if you don't want to be there?" The work grinds small business owners down, and they become disillusioned with their businesses.

This is probably true for many, new small business people. Many people aren't cut out to operate a business. Running a business is hard work. But, rather than acknowledge that reality, the goal, according to Gerber, is to create a business which doesn't need you, to create a "systems dependent business" and not a "people dependent business."

Gerber uses McDonald's as his prototypical model of operation. Gerber says McDonald's is an example of a turn-key business. You just put the key in the lock and the business works. A prototype franchise that can be easily replicated is Gerber's holy grail of business.

Gerber writes: "Given the failure rate of most small businesses, he [Ray Kroc, the founder of McDonald's] must have realized a crucial fact: for McDonald's to be a predictable success, the business would have to work, because the franchisee, if left to his own devices, most assuredly wouldn't!...Once he understood this, Ray Kroc's problem became his opportunity... Forced to create a business that worked in order to sell it, he also created a business that would work once it was sold, no matter who bought it... a foolproof, predictable business.... A systems-dependent business, not a people-dependent business."

I disagree with this analysis. Difficulty of management is a fundamental problem with any delocalized business, one with many locations spread throughout a large area. A dedicated manager is needed on each site. One manager can't oversee all the business locations. The franchise concept is one way to place devoted managers at each location. Each franchisee is not only carefully selected (in a good franchise) and carefully trained, but each franchisee has paid money to own the franchise. So, each manager becomes an owner. And, owners care more about the success of their business than anyone else. They are willing to work harder than anyone else to see the business succeed. Their own money is at stake.

Ask owners of successful franchises if they sit around *not* working. If an employee doesn't show up, who fills in? In fact, many franchise owners will tell you that buying a franchise is very much like buying a job! The fundamental premise that a McDonald's franchise can function with just anyone *not* working at the helm, while the operation just sort of self-manages, is incorrect.

It's true the best franchises don't tend to fail, but they aren't sold to just anybody either! I'm not criticizing the franchise concept. My goal is just to show that few businesses are purely "systems dependent."

Gerber suggests you try to create a template business operation that works of its own accord so that it can be replicated in a cookie cutter approach. Easier said than done!

Where do you get the basis for this template, or as Gerber calls it, "Franchise prototype" ? Gerber says the "franchise prototype" is part of your entrepreneurial vision. You dream about what your business will look like in the future. In practice, most successful franchises are based upon many years of operating history and industry experience. And, many knowledgeable business owners, who fully understand the franchise concept, have failed dismally when trying to franchise operations.

Of course, McDonald's and other established franchises have spent billions of dollars to create brand awareness for the franchise, which brings in a steady flow of customers. Your new "business format franchise" (way of doing business) won't have brand awareness. You will need to build it. Building brand awareness is marketing, and no marketing plan is ever assured to work. There won't be a cookie cutter marketing plan to toss in with the cookie-cutter operation.

"The E-Myth Revisited" is also a bit dated. Gerber writes, "A soggy French fry is not a McDonald's French fry." That has not been my recent experience. So much for flawless systems!

I did catch a glimpse of the last pages where Gerber offers a free "Turn-Key AnalysisTM" of your business. He writes, "Conducted over the phone in no more than an hour, our Turn-Key AnalysisTM will determine exactly what needs to be done in your business to give you everything you want from it: what essential building blocks are missing and need to be added; what processes and systems are absent or, if present, are inadequate to achieve the results you want to produce."

That's a pretty impressive offer! In under an hour, over the phone, he'll tell you exactly what's wrong with your business! I think I'll pass on that. But, do consider contacting SCORE (Service Corps of Retired Executives), your local small business development center, or business graduate school. Each of these might be able to provide small business counseling. Be sure to specify that you want a complete turn-key operation with no work and no management. Showing up for business optional.

Yet, some business owners claim that this book has helped them. I think they might be confusing good old organization and routine for a "systems dependent business."

Peter Hupalo, author of "Thinking Like An Entrepreneur."

Definately one the best books I've read so far for helping a small business owner get his/her head around how to run his/her business.

Great book, was so thorough and well written that I decided not to go into business at the end...because I realized, I did not have all the aptitudes and motivations to be a good business woman.