The E-Myth Revisited
Why Most Small Businesses Dont Work and What to Do About It
M ICHAEL E. G ERBER
To My Father,
I wish he were here .
CONTENTS
Acknowledgments
Foreword
Introduction
Part I: The E-Myth and American Small Business
Chapter 1. The Entrepreneurial Myth
Chapter 2. The Entrepreneur the Manager, and the Technician
Chapter 3. Infancy: The Technicians Phase
Chapter 4. Adolescence: Getting Some Help
Chapter 5. Beyond the Comfort Zone
Chapter 6. Maturity and the Entrepreneurial Perspective
Part II: The Turn-Key Revolution: A New View of Business
Chapter 7. The Turn-Key Revolution
Chapter 8. The Franchise Prototype
Chapter 9. Working On Your Business, Not In It
Part III: Building a Small Business That Works!
Chapter 10. The Business Development Process
Chapter 11. Your Business Development Program
Chapter 12. Your Primary Aim
Chapter 13. Your Strategic Objective
Chapter 14. Your Organizational Strategy
Chapter 15. Your Management Strategy
Chapter 16. Your People Strategy
Chapter 17. Your Marketing Strategy
Chapter 18. Your Systems Strategy
Chapter 19. A Letter to Sarah
Epilogue: Bringing the Dream Back to American Small Business
Afterword: Taking the First Step
About the Author
Other Books by Michael E. Gerber
Copyright
About the Publisher
I would like to express my deepest gratitude to the many people with whom Ive worked to produce the ideas that are presented in this book, as well as for the support needed to complete it.
To Ilene Gerber, my wife, partner, and editor, without whose intensity of purpose, dedication to the truth, and love for the work, both in our business and in the rest of the life we share together, neither this book, our business, nor our marriage would have been possible.
To Shana, Kim, Hillary, Sam, and Alex Olivia, my children, who have given to me more than they have received, in ways only a father can truly know.
To all my associates at E-Myth Worldwide, present and past, whose commitment to the ideas in this book, as well as to each other and our clients, have given meaning to the words by living them, even when it was impossible and when there seemed to be no good reason for doing so.
To all our thousands of clients over the years who have put their trust in our integrity, and, in the process, caught us at least as much as we taught them about what it means to transcend scarcity with excellence.
To Nancy and Bob Dreyfus, my sister-in-law and brother-in-law, whose wisdom, love, and generous spirits have touched me more than they can possibly know.
To Virginia Smith at HarperBusiness, whose caring, intelligent friendship has seen me through the most dismal moments of writing with a gentle, open, and willing nature that enabled me to be myself in the moments I least wanted to be, without apology or explanation.
And, finally, to all my readers who continue to support my work so enthusiastically.
Thank you all.
I t has been fifteen years since The E-Myth was first published. In my case, fifteen full years. A lot has happened in the interimwith my family, my business, my life. Many wonderful things, many good things, many painful things. And, if its true what Don Juan said in Tales of Power , that The basic difference between an ordinary man and a warrior is that a warrior takes everything as a challenge while an ordinary man takes everything either as a blessing or a curse, then I am as guilty of being an ordinary man as the next guy, and, on occasion, have ascended to the warrior state when God saw fit to provide me with the power.
In these fifteen years, I have experienced near financial and business disaster as well as incredible victories; have built a 16-year marriage into an exquisite partnership with my wife, Ilene; have become the father of two extraordinary children, Sam and Alex Olivia (the total is now five, ages nine years to thirty-eight years); have entered the anointed state of grandfatherhood thanks to my daughter Kim and my son-in-law John, who have blessed us with Sarah, Elijah, Noah, Hannah, and Isaiah; have traveled throughout the world speaking to hundreds of thousands of small business owners in Australia, Canada, Spain, New Zealand, Japan, Puerto Rico, Mexico, Indonesia, and, of course, in almost every major city in the United States. And, through it all, I have been the grateful recipient of unrestrained support and caring from many of those whose lives I have in some way managed to touch and whose paths I have crossed.
In short, the years have been exhilarating, challenging, frustrating, exhausting, debilitating, boring, enlightening, rewarding, and, after all is said and done, a handful for anyone, especially for a guy my age with a penchant for going to the wall without concern for the damage I do to the leading parts of my body.
This book, then, is a product of the last fifteen years, as well as a product of the fifteen years that preceded them. It was almost exactly eight years before The E-Myth was published that I founded our company, E-Myth Worldwide, which has provided the fuel and experience for the point of view I have shared with those of you who have read The E-Myth , and with those of you who are about to read this book.
In the years since The E-Myth was published, many of my readersas well as many of our small business clientshave asked me to clarify specific aspects of The E-Myth point of view so they could better apply it to their businesses. This book answers many questions that The E-Myth has raised over the years, offering both new and previous readers the opportunity to approach their businesses with renewed vigor and a sharpened mindset through an expanded experience of The E-Myth principles.
Toward that end, I have attempted to answer the most important questions I have been asked about the principles covered in each chapter by means of a running dialogue with a wonderful woman named Sarah (not her real name) with whom Ive spent quite a bit of time over the past year. Sarahs experience in business, her patience, intelligence, and passion have helped me to address the challenging issues of our small business clients in the reorganization of their minds as well as their businesses. It is in response to Sarahs frustrations, and her very personal inquiry, that I have endeavored to clarify for the reader the E-Myth Point of View. I hope that Sarah and her questions are as engaging to you as they have been to me.
But, before I introduce you to Sarah, Id like to share with you some thoughts about small businesses and the people who own them.
The question has often been asked of me, What do the owners of extraordinary businesses know that the rest dont?
Contrary to popular belief, my experience has shown me that the people who are exceptionally good in business arent so because of what they know but because of their insatiable need to know more .
The problem with most failing businesses Ive encountered is not that their owners dont know enough about finance, marketing, management, and operationsthey dont, but those things are easy enough to learnbut that they spend their time and energy defending what they think they know. The greatest businesspeople Ive met are determined to get it right no matter what the cost.