Sunday, November 30, 2014

The 1 Missing Element of Michael Gerber’s E-Myth Book

There is a book by Michael Gerber that nearly every actual and wannabe entrepreneur should read called The E-Myth.  (NOTE: The book’s actual title is “The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It.”)

Overall, it is brilliant.  One of the main points of the book is that one main reason that it’s so hard to be a business owner is that it requires us to be three (3) people:  a technician, a manager, and an entrepreneur.  Most of us are only one or two or these, but a successful business needs all three of these elements.

My slowly developing experience thinks this is brilliant and accurate.

However, I realize that there is one missing “person.”

Each person Gerber lists is right on the money.

Technician: A technician focuses on DOING THE OPERATION.  In the E-Myth, Gerber uses the example of a woman who loves baking.  That’s what made her want to go into business for herself in the first place.  She loved baking.

Manager: A manager focuses on OPTIMIZING THE SYSTEM.  A manager tries to find ways to make the existing system run more efficiently.  The manager wants to take each person and fit him or her into that system.  The manager makes plans and expects people to follow them.

Entrepreneur: An entrepreneur HAS VISION in places nobody else does.  By nature, the entrepreneur lives in the future.  He focuses on opportunities and ideas, not the operation.  He sees what “can be” but not always how to get there. 

When viewed this way, it’s amazing there are any businesses at all.  Very few people are all three “people.”  That is why many great companies have more than one “real person” who founds them, because it is so tough and uncommon for any one of us “real people” to be all three of “these people.”

Michael Gerber did an amazing job by identifying these “people” and explaining them in his book the E-Myth, but my experience tells me there is—at least—one more “person.”

The Missing Person

Engineer: An engineer is sort of like an entrepreneur, but his vision is on finding new ways to perform the operation.  The entrepreneur sees opportunities in the form of business models, marketing, or sales efforts.  The engineer sees new opportunities within the business model.  Managers try to optimize the current process.  Engineers try to optimize the selection of the process for managers to optimize.  Most entrepreneurs are looking for things outside the operation.

So you might be able to say that an Entrepreneur has “external vision” while the Engineer has “internal vision.”

I realize that you can extend this to be the accountant, quality control, etc.  However, most of those are support to or branches of the operation (Technicians) that are part of the system a Manager tries to control and optimize.

A business without an Engineer runs the risk of not developing new products, processes, or systems that keep pace with or ahead of the competing market.

If you have the three other “people,” a business could be in trouble down the road.

Whether I’m right about this, I suggest that you read…or even re-read…the E-Myth by Michael Gerber.  After writing this, I think I need to reread his book.  It does a great job of helping us understand why many of us business owners tend to get in our own way.

It also might provide a quick checklist that might let us know when we need to add a partner to our business…and what type of person that partner needs to be.

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