The E Myth comes to Philadelphia – Part 1
The E-Myth comes to Philadelphia – Part 1
“The vision was all but gone in most.
The zest for the climb had turned into a terror of heights …
Exhaustion was common, exhilaration rare.
But hadn’t all of them once been entrepreneurs? After all they had started their own business. There must have been some dream that drove them to take such a risk…
Where was the entrepreneur who had started the business?
The answer is simple: the entrepreneur had only existed for a moment.”
Michael E. Gerber, The E Myth Revisited
Have you read the E-Myth? If not then go out and buy it today and read it (or call me and I’ll send you a copy). Michael Gerber, through clear and simple writing, shows us all how to make small businesses successful, satisfying and profitable. As he notes, we are all entrepreneurs when we take the plunge and start a business but since most small businesses fail, we don’t often succeed.
“What do owners of extraordinary businesses know that the rest don’t?” Michael Gerber asks in the introduction, “People who are exceptionally good in business aren’t so because of what they know but because of their insatiable need to know more.”
If you are reading this blog then I assume that you have that insatiable need to know more. In a three part post I will pull from the E Myth the key take away points I see and apply them directly to the small businesses I work with in Philadelphia.
So let’s bring the E Myth to Philadelphia.
So what is the E Myth anyway?
According to the book it is the fact that we all start as a technically competent person (baker, salesperson, engineer, seamstress, etc) who gets fed up with working for someone else and given that we are good at our technical expertise, we think we can run a business better than the clown we are working for.
“If you understand the technical work of a business you understand a business that does the technical work”. And this is fundamentally false!
Here in Philadelphia we are no stranger to this phenomenon.
Individually we are all THREE. You’ll have to read the book to understand all the gory details, but what I took from the discussion is that as a business owner, we are all three at once. It is this seeming conflict that drives us crazy (and bankrupt). So who are these three people caught inside one entrepreneur?
The Entrepreneur is the visionary, the optimist. Someone who looks at every problem as an opportunity and if only other people would move faster we could be onto something great here. The entrepreneur craves control.
The Manager is pragmatic. The manager wants a plan. He wants to see the work completed on time and on budget. The manager craves order.
The Technician is the doer. Dreams and plans achieve nothing. Executing is what matters. The technician wants to get it done.
As I said, the small business owner is all three. He or she is all three all at once. And as you can imagine, often that just does not work well. Someone loses and the entrepreneur is not whole. The business is not tended too (vision, plan, and execution). Something gives, customers evaporate, employees are jettisoned, and failure is assured.
The typical business owner may be 10% entrepreneur, 20% manager and 70% technician. That formula severely limits the business owner’s chance of succeeding. By definition, it makes the business owner the bottleneck in the organization. It limits the value of the organization to the value of the business owner’s direct labor input. Just try to sell that kind of company for 2X sales.
I’ll share with you an example from our work here in Philadelphia.
I have worked with a very successful service organizations but I can only imagine how great they could be if the owner was able to achieve balance. As it is, he works like crazy since he must have his hand in all facets of the business. His clients love him and he makes plenty of money. Perhaps this is your definition of success. I would argue that the business has only a fraction of the value it should and while he loves his work, he is missing out on other important personal things. He is the consummate technician. Is there a way for him to create a business that will work FOR him? To build an organization that he can harvest to allow him more personal time and be able to sell when the time is right?
If this was your company, how would you want to see your time be divided between entrepreneur, manager and technician? If it were me, I would want it to be 50% entrepreneur, 30% manager and 20% technician.
What does flipping these percentages do for the business and more importantly, how do we get there from here?
In part 2 we will look at why balance is important, why being the technician is not a good way to build a successful business, and how to get over the hump of being a great technician who started a company to running a great company that any technician would be proud to call their own.
We will look at the business from the entrepreneurial perspective. “The Entrepreneurial Perspective adopts a wider, more expansive scale. It views the business as a network of seamlessly integrated components, each contributing to some larger pattern that comes together in such a way as to produce a specifically planed result, a systematic way of doing business” (The E Myth Revisited p72)