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

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Summary: The E-Myth Revisited
Review: The reason this is the best business book I have ever read is because it reveals to the reader why the reader does what he or she does. Inside you are three entities vying for control: an entrepreneur, a manager and a technician. Reading this book you will discover which one of these parts of you is running the show and why. Confused? Think of an overweight person. He or she has a fat person and a skinny person inside them. When the skinny person assumes control, it's salads and skinless chicken. When the fat person gets control it's banana splits and hot fudge. When the technician is at the helm in your life, you're separating paper clips or designing forms on the computer when you should be managing your job or out pursuing new clients. Get the picture? Realizing why you do, and don't do the things you should is profoundly enlightening. How much do I like this book? I buy several copies at a time to hand out to friends.

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Summary: A great book for anyone in charge of anything
Review: I think this is an excellent book. It has philosophical depth as well as fairly detailed how-to coverage. It covers the people side of life and business as well as the systems side - how to set up the various systems of any operation to make the operation work. It puts life first, business second: it helps us make our business or career a building block of our life, not the reverse. The reviewer who only read the first half of the book missed the best parts: HOW TO DO what it takes to get your business to support your life aims and needs and the life aims and needs of your employees, customers, and suppliers. Getting Gerber's philosophy or viewpoint is half the learning; learning how one can do it is the other half. Gerber gives us both. This book touches the essence of quality management. I am a business professor and I will recommend it to my students.

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Summary: Small Business Owners - Take Notice!
Review: Gerber's book on why most small businesses do not work (or work well) is now something of a cult-classic with small business coaches. As a coach, this book is required reading for my clients who own (or want to start) any small business, because it helps my clients shift their perspectives about their businesses - from focusing solely on the business itself and what's wrong with it; to first focusing on what your life mission and purpose is, and then reinventing your business so that it will joyfully support that life purpose. ....

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Summary: I believe "systems dependent businesses" don't exist.
Review: 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."

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Summary: Some Good Ideas Here
Review: The author describes his younger years (0-40) as a wandering neer-do-well who could not keep a job or a wife for long, and then sort of fell into whatever he is doing now. He never ran a business until he started his consulting business -- where he tells people how to run their businesses. Gerber loves the franchise form of business, where the new franchisee goes to "Hamburger U" and learns every detail of running a burger shop. My business (a wine distributor) is not a burger shop. Something new pops up every day, and it's not in the operating manual. That said, the book is worth the short time it takes to read it. I took some good ideas from the book and plan to try implementing them in some form in my business.

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Summary: SOME PRACTICAL ADVICE BUT...
Review: With thirty years to my credit in teaching and counselling in business management, entrepreneurship and behavioural psychology, business has become a major aspect of my life. My training manuals are still being revised, reprinted and used in classrooms in my country today. I tell you this for no other reason but to assure you that "entrepreneurship" is not a foreign word to me.

There is no question the author, "knows his stuff", but his presentation style appears to me to be just a touch too self-serving in an attempt to promote his own entrepreneurial activities. While the author is quite correct in principle, he appears, perhaps, too caught up on buzzwords and theories. The reader will have to use much of their own judgement when it comes to evaluating where the author is speaking from knowledge and experience and where he is making very general assumptions.

First of all, not everyone is going to become a successful, lawyer, doctor, auto mechanic or computer technician, nor is everyone destined to become a successful entrepreneur. You can receive the best quality education and training but if you do not have an apptitude for entrepreneurship, you will not likely be successful, so apptitude and attitude are key. If you cannot manage money, do not like to take calculated risks, or expect a guaranteed paycheck during those start-up years, you may be pleasantly surprised as a new entrepreneur. Also, I did not see much content here on the importance of planning and market analysis, which are critical to the survival of any business no matter how much "entrepreneurial spirit" you may have.

What really irked me about the book was not the content, but the lack of relevent and critical information, and the author's self-patronizing attitude. Perhaps he did not intend it that way, but it did have a certain promotional ring to it. His personal stories and "what works for him" make interesting reading, but I wouldn't bet the bank that it will necessarily work for everyone. Yes, the book does have merit, but if I knew little about entrepreneurship, I would definitely want to investigate a small business start up more fully before investing my hard earned dollars, or someone else's dollars, into a business venture, no matter how much entrepreneurial spirit was in my bones.

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Summary: Think more, do less, grow more, profit more
Review: I sometimes wonder if the people that give low ratings to this book even understood a word of it. When people complain about the lack of a specific HOW TO in it, I have to wonder how much of a baby they are. No, this book will not hold your hand. It will not 'do it' for you. That's not it's purpose. What this book does is get you to think about your business more than work in your business. As he says, "Work ON your business, not IN it." For those that complain about the lack of concrete steps - he included a quote from Ford. Ford said something to the effect of, "I have other people that know more than me, and that do more than me - which frees me up to do something more important: Think." For the people that are willing to think more - this is THE book.

~ jayse

PS - complaining about him trying to promote himself?? Give me a break! Haven't you read any good business books? I would never trust anyone that talks about good business and selling techniques that failed to try to sell me something more. I barely noticed it.

PSS - no, I never met the author or the publishing company. I just sincerely found this book to be amazing, extremely entertaining and thought provoking.

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Summary: Interesting and useful concepts, and also enjoyable reading
Review: This books is very interesting in two ways. It gives the reader a very clear view of an enterpreneur mind and problems, and offers solutions to them. The other remarkable aspect is the way it is written, it's not only enyoyable, but the strategies that the author use for introduce the concepts in the book can also be used by the reader to do the same with asociates and peers. A big pitfall is that the author never looses a chance to promote his services as a consultant.

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Summary: Good start, fails in the second half
Review: Although this book started out with some great ideas, by the middle I was tired of the self-promoting and sappy style. In fact, I could not read the second half at all. I tried to ignore the writing style and get to the meat, but the book was ruined by too many personal stories and pontification when I was looking for straightforward, solid business practices. Some of the basics are there, but they are hidden in a sea of mush.

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Summary: Read this before starting your own business!
Review: This is one of the few books you must read if you want to go into business. It's called The E-Myth because it addresses the entrepreneurial myth. The book starts off by telling you what a business is not. Having done so, the book goes on to tell you what a successful business is all about.

In a nutshell, a successful business is all about systems. A systems-based business is neither beholden to individuals nor at the mercy of their personalities and quirks. It is capable of running on its own without its owner having to be present.

An owner who cannot afford to be away from his business is merely a self-employed person. An employee sells time. A self-employed mere buys a job to work in. A real business owner works on the business rather than in it. The book adopts the concept of a franchise as the ultimate objective of all business owners. By aiming to be a franchise in any business you do, you will be reminded of the need to systematise every facet of your business.

If you are an employee, have little or no prior experience in business, but are keen to start your own business, you would do well to read this book. There are a lot of things that you should know before taking the plunge. This book will save you a whole lot of heartache and unnecessary aggravation.