The E-Myth re-revisited #5

photo credit: Jim Frazier

 For every person who starts a business of their own, or has a small business, Michael E. Gerber’s book, “The E Myth Revisited” should be a required read. I’m going to post once a week on ideas from this book. For those who have never read it, I’ll boil it down for you, although you should get a copy anyway, I’m only going to talk about the lessons, yet there is much more. Gerber is a wonderful story-teller. For those who have read it, this will be a refresher of a wonderful business-self-help classic that stands the test of time, and it is one of those few books that you find yourself reading over and over…

The difference when a small business starts out like a mature company is that they start with the entrepreneurial perspective. They have a vision of what the company will look like when it’s finished, when it is done, when it is ready to be sold. They act the way that a big company would act, from day one. In order to become a great company, you have to act the way that a great company would act, right from the start. They know that unless they act mature right from the beginning, they will never get that way.

The entrepreneurial perspective dictates; that what is more important than the product, commodity, or service that a company offers, is the WAY it offers those things, the way it looks, the way it acts. It sees the business as a system for producing certain results for the customer. The typical small business technician-oriented perspective looks only at the work of the business, and how the work is done. The entrepreneur sees the business like a product sitting on a shelf, competing with other products that are other companies. The commodity is not important, the way it is delivered is! 

What is the product your small business delivers? Most people instinctively answer with the product or service they sell, “we make widgets”, “we do plumbing”, whatever. Always the commodity, never the product.

The entrepreneur looks at the world and asks, “what is the opportunity”? The entrepreneur then goes out and invents a solution to a perceived need out there in the marketplace. The entrepreneur asks, “how will my business stand out from all the rest of the businesses that offer that commodity solution”? And so the entrepreneur does not start with a vision of the business, but with a vision of the customer solution. The technician started with what he wanted to do for work and asks, “how can I sell what I am offering”? 

Next time we’ll look at how the concept of a franchise created the turn-key revolution…

Tagged as: Business, E-Myth, small business