The E-Myth Revisited Book Summary

Book Summary

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Brief Summary

The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It (2001) by Michael E. Gerber explores the question of why so many small businesses don’t survive. The answer is simple, yet profound: most business owners have no clue as to how to run a business. Most small business owners start as employees who possess some sort of technical skill. After working as employees for a while, they falsely believe they’re ready to be the boss. Being a worker and being an entrepreneur requires two entirely different skill sets. Suddenly, people realize that being their own boss isn’t a privilege. It’s a terrible chore.

Small business owners have three conflicting perspectives: the Technician, the Entrepreneur, and the Manager. The Technician’s perspective is focused on daily tasks related to the business owner’s old job. The Entrepreneur is the big thinker who takes on the job of being a leader. Entrepreneurs dream about the future. The Manager is the organizer who figures out how to implement all the Entrepreneur’s big ideas. To become a successful small business owner, it’s necessary to balance the work of the Technician, the Entrepreneur, and the Manager.

About the Author

Michael Gerber was born on June 20, 1936, in Elizabeth, NJ to Harry Gerber and Helen Gary Gerber Aaron. Gerber married his third wife, Ilene (a partner and shareholder in E-Myth Worldwide) in 1985, which ended in divorce. He is currently married to Luz Delia (2006 to the present). Inc. Magazine calls him “the World’s #1 Small Business Guru” — the entrepreneurial and small business thought leader who has impacted the lives of millions of small business owners and hundreds of thousands of companies worldwide for over 40 years. He is the author of the NY Times mega-bestseller "The E-Myth Revisited.” He has also authored nine other worldwide best-selling E-Myth books focusing on SMEs, leadership, and management. Additionally, Michael E. Gerber has written 19 industry-specific E-Myth Vertical books co-authored by industry experts for a wide array of professions that include attorneys, accountants, optometrists, and chiropractors amongst others. His mission is to transform the state of small businesses worldwide.

Topics

Entrepreneurship Management & Leadership

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Key Insights

Small business owners have three conflicting perspectives: the Technician, the Entrepreneur, and the Manager. The Technician’s perspective is focused on daily tasks related to the business owner’s old job. The Entrepreneur is the big thinker who takes on the job of being a leader. Entrepreneurs dream about the future. The Manager is the organizer who figures out how to implement all the Entrepreneur’s big ideas. To become a successful small business owner, it’s necessary to balance the work of the Technician, the Entrepreneur, and the Manager.

Chapter 1: The Entrepreneurial Myth

Michael Gerber says that many people who get into business do so because they don’t want a boss. They believe that because they succeed as workers, they know how to run their own business.

The Fatal Assumption about business is that any person with technical skills can achieve success. This is false and many “technicians” end up failing in business.

Not everybody who starts a business is an entrepreneur. This is similar to saying everybody who can cook is a chef.

Chapter 2: Entrepreneur, Manager & Technician

Michael Gerber shows that most small businesses fail because the owners lack managerial and entrepreneurial qualities. In essence, they are technicians and not managers.

Technicians start a business after getting tired of working for others.

Entrepreneurs are visionaries who may not have all of the resources to make their ideas a reality.

Managers are concerned with planning and organizing.

Chapter 3: Infancy, The Technician Phase

At the infancy stage of a business, the business and the owners are one and the same.

The infancy state ends when the business starts to grow and requires more than the abilities of the owner.

If a business only depends on the existing skillsets of its owner, it is not a business, but a job. Most people don’t own businesses but jobs.

Chapter 4: Adolescence, Getting Some Help

At the adolescent stage, a business starts hiring and the “the technician” who is the owner becomes a manager.

The most common mistakes of early managers are known as Management by Abdication: delegating too much without supervising the quality of work.

Additionally, managers can do the opposite and not delegate or teach workers how to complete jobs successfully. The manager then winds up doing most of the work himself.