The E-Myth Revisted By Michael Gerber
This past week, I read The E-Myth Revisited by Michael Gerber. I’m sure many of you have either read or heard of this book before, as it is the de facto Summit Bible. For those who are unfamiliar, the E-Myth, or the Entrepreneurial Myth, tackles the belief that everyone who has started and runs their own business is an entrepreneur. In reality, these people are often experts at a craft. They could have been a baker, doctor, lawyer, realtor, chef or even a painter or paver. Whatever their profession, at one point in their careers they were taken hostage by the “Entrepreneurial seizure”.
These same people were stressed, tired and overworked and thought “Why am I doing all of this for someone else, and making them money? I can do this on my own!” So they do. The book navigates the challenges and difficulties of small businesses through the lens of a woman named Sarah, who after suffering from an entrepreneurial seizure of her own, opens a pie shop called “All About Pies”. As we learn more about Sarah and her pie-making business it becomes very clear that Sarah is, to borrow another commonly used Summit term, stuck dead in the hourglass.
Get Out of the Hour Glass.
It’s the reason why most people join the Summit. But how do business owners successfully accomplish this? How do they give up control of their business and have it become MORE successful? What does business success look like? I believe success means different things for different people. Some people want to conquer the world, and grow their businesses to great heights. Others want to make a good living and serve their local community as best they can. I believe the average Summit Member falls somewhere between the two. But no matter what your ambitions, the one thing we can all agree upon is that we want not to serve our business, but for our business to serve us. The E-Myth describes how to adjust your small business to do just that.
My two major takeaways from reading the book:
- Work on your Business, not in your Business
- People Run the Systems, and the Systems run the Business
On Rather Than In
At our most recent Field Supervisor’s boot camp, Conal Mulreany described the role a Field Supervisor needs to play as needed to fly at 30,000 feet; when issues arise that need your attention, you fly down to 6,000 feet, but once it’s solved you fly right back up. When it comes to working ON your business as opposed to working in it, I believe the same principles apply. Getting stuck in the muck of the day to day as a business owner happens all too often. Before you know it, its 9 pm and you’re just getting home, with emails still sitting unanswered in your inbox.
I’m not saying you should ignore the irate customer on the phone or stop responding to phone calls from your employees, but you have to be deliberate about making time in your day to step back and look at your business from 30,000 feet. The business plan that each Summit Member does when they first join Summit is not an exercise in futility. You need to make time for your Big Rocks. You need to look at where you want to go and layout how you want to get there. Failing to plan is planning to fail. When you have clear goals and a Vision, you can begin to put plans in place to not only reach these goals but list out the steps needed to reach them.
Every action of your day should be made with the intent that it will help you hit your goals. What does this look like?
- Developing a sales team so you no longer have to estimate every job.
- Hiring and cultivating an office staff that benefits your customer service and operations.
- Maybe it even looks like hiring people to just help you produce the work.
However, bringing on people to help get you out of the hourglass is half the battle. Once you bring people on, how do you guarantee the same quality on tasks that you were previously doing yourself?
People Run the Systems
“A system is a repeated course of action, a way of doing things that brings about a result.” Systems are the lifeblood of small businesses and the key to breaking out of the hourglass. As businesses grow, many owners have a tough time letting go. They have poured their lives into the success of the business and become afraid to lose control of a piece of its success. With the right systems in place and the right people to run them, letting go is no longer akin to losing control. You are simply now letting a more qualified and specifically trained employee run a system that you have created. You can never and should never micro-manage the people, but you absolutely must control the systems they follow. Systems should be constantly reassessed for both efficiency and profitability.
Systems produce predictability, sustainability, and consistency. As Michael Gerber stated, the best systems allow you to devote your mental capacity to work on your business, such as improving your system’s efficiency. Unpredictability is the enemy of profitability. It would be great if everything in life was predictable. Can you imagine where you would be today if you knew the 2008 recession was coming far in advance?
Systems allow for your business to run independently of yourself. While you once took the calls, estimated the work and did the work all by yourself, you now have the people in place and systems in place to where they can execute their tasks exactly the way you want them. Your business has now become replicable. You can take what you implemented in this business and duplicate it, allowing you to expand and grow. While it is never as simple and as easy as it sounds, systems are the vehicles for growth. While we know that nothing in this world is completely predictable, having systems in place is the next best option. When things are predictable you can plan when you plan you can execute, and when you execute, you will thrive.
All the best!