In this post I'll cover what The E-Myth Revisited is all about and give you a punchy summary of the book so you can use its ideas for your business and decide whether you should go ahead and read the whole thing. All in 4 minutes, so strap in and let's get started.
What is The E-Myth Revisited about?
The E-Myth Revisited is about the key difference between being in business because you have a technical skill, and being a businessperson. It argues that most small business owners aren’t actually businesspeople, they have simply created a job for themselves.
By understanding the difference between the two, a small business owner can open up huge opportunities to design a better business and be more happy and successful.
Let me explain using an example.
Let’s say Bob enjoys coffee and has developed a skill roasting coffee beans. His friends encourage him to start a coffee roasting business and Bob agrees it’s a good idea.
The problem is, Bob is good at the technical skill of roasting coffee beans and could work for a coffee roasting business as a valued employee. But roasting coffee beans is only one small part of running a coffee roasting business.
Here’s the misunderstanding that E-Myth tries to highlight. Sure, you need the technical skills to roast coffee, but running a coffee roasting business also requires entrepreneurial and managerial skills.
The mistake most people make is that they think if you understand the technical work of a business (roasting beans), then you understand the business that does that technical work (food manufacturing, sales and distribution).
According to the author, Michael Gerber, this is the reason for most small business failures.
The technical work of a business and a business that does that technical work are two totally different things. But the technician, like Bob, who starts a business will fail to see this.
Therefore, E-Myth argues that a business owner should focus on taking themselves out of the business to free themselves up to work on their business, continually improve the business and set up the business so it runs independently of the owner.
The E-Myth Revisited in 5-bullet points
Here is what you need to know about The E-Myth Revisited in five punchy bullet-points:
- Most small business owners work “in” their business rather than “on” their business. If you are not willing to change that, then your business will never be capable of giving you what you want from it.
- People who are exceptionally good in business are this way because of their unquenchable need to know more. It takes becoming a student of your business and the insatiable desire to get better and improve to become a great businessperson.
- Everybody who goes into business needs to be three people in one: the entrepreneur, the manager, and the technician. We all have an entrepreneur, manager, and technician inside us, and need to draw from all three in order to run a successful business.
- Business failure can be explained by three simple points: 1) Business owners make the fatal assumption that if you understand the technical work of a business, you understand a business that does that technical work. 2) This leads to entrepreneurial seizure, which is the moment you decide it would be a great idea to start your own business. 3) As a result, the technician suffering from an entrepreneurial seizure takes the work he loves to do and turns it into a job.
- If you want to work in a business, get a job at somebody else’s. But don’t go to work on your own. Because while you’re working, there’s something much more important that isn’t getting done. It’s the work that will lead your business forward. If your business depends on you, you don’t own a business, you have a job. The worst job in the world because you’re working for a lunatic. Besides, that’s not the purpose of going into business, the purpose of going into business is to get free of a job so you can create jobs for other people.
How can The E-Myth Revisited help my business?
If you follow the arguments in the book, every business owner can avoid the E-Myth trap by removing themselves to work on their business to create replicable systems and processes. Start by asking yourself the following questions:
- How can I get my business to work, but without me?
- How can I get my people to work, but without my constant interference?
- How can I systematize my business in such a way that it could be replicated 5,000 times, so the 5,000th version would run as smoothly as the first?
- How can I own my business, but not spend time working on day-to-day operations?
- How can I spend my time doing the work I love to do rather than the work I have to do?
The rest of the book continues to break down into a 7-step Business Development Program which lays out the approach through which you can design your business.
Who should read The E-Myth Revisited?
While I usually narrow down a specific persona that would benefit from reading a book, I recommend The E-Myth Revisited for every business owner. No matter what industry you are in, whether small business or large, or whether you are just starting out or have decades of experience. Every business owner will get something of value from this book.
Reading the best small business books is a surefire way to improve your business knowledge and find ideas to bring back to your own business. If you want to build a better business, you should sign up to get my simple business improvement ideas that can grow your profits and improve your operations.