Semester 1- Class 2

Intro to Emyth (Organization

of Your Business)

Duane Hoversten Instructor

South Central College
Copyright 2007

Do You like your Business

Now??
Does it Give you what
you want in Life??..
Money
Time
Satisfaction

E-myth Revisited
by Michael Gerber ..

Insight into Small Business

Observations on Small
Business Owners
1. Work too hard for the
money they make
2. Business Owners are
doing the Wrong work
in the business
3. Result is - Chaos,
Unpredictability, and
Failure.
4. Information abounds
- yet the business fails..

More Observations on
Your Business. It is You..
If your thinking is sloppy - your
business will be sloppy.
If you are disorganized, your
business will be disorganized.
If you are greedy, your
employees will be greedy.
If you lack direction on how to
improve your company, your
company will not improve and
will lack direction.

Fatal Assumption
If I understand
the technical
work of a
business, I
understand the
business that
does technical
work.

The Facts
SBA 80% of Small Businesses fail
within 5 years (50% in 18 months)
Franchises have a 95% Success Rate
in 1st Year
Franchises have a 75% Success Rate
for Business Format Franchises in 5
Year Period

The

Myth

Small Business should be started by

Entrepreneurs risking capital to make a
profit.
(Fact is businesses are started for far different
reasons)

How do we Overcome the E Myth?

A Turn-Key Franchise Business can be created by
using a Systemized Process of installing Systems
in Business. By Using the Ideas of a Turn Key
Business with a Systemized Process, you create a
vitality and sustainability in any company.

What do We Change in Your

Business??
Your Business is a Reflection of
You!!
We need to:
Change your Skills and
Attitude
Set Goals with Accountability
Create a Turn Key Business

Changes for Your Business

Have you Work On the
Business Not in It
Getting you the
owner/manager doing the
right things in your business
Getting the right people in
your Business
Concentrating on Systems

Goals
Set Goals
Accountability on
Progress
Mentoring

Turn Key Business

Your Business should run
by itself if you are gone a
month
Your Business becomes
saleable when you have a
Turn Key Business
You have time to Work on
Your Business

Work in your business

Do Not Run to the Post
Office Daily
You are worth $50/hr $1000/ hr
Do the work that the
Owner should be Doing
Set the Culture in Your
Company

Right People in your

Business
Good People do Not
make Good
Bookkeepers
Good Bookkeepers
make Good
Bookkeepers and we
would like them to
fit into the culture of
our Company

Systems
This is a base
measurement of all that
goes on in the company
When there is a problem,
look at the system before
blaming people
We do not have to reinvent
the wheel all the time
Eliminates going to the
Owner for Everything

Goals

Written
Measurable
Realistic
Create a
Movement in You
or Your Company

E Myth (Small Business)

Personalities

3 Distinct Job
Types
Entrepreneur
Manager
3 Way Battle on how to handle each

Technician
problem
The best personality does not always
surface and win.
IT IS BEST TO HAVE DIFFERENT
PEOPLE FILL THESE SEPARATE JOBS.

The Technician
Is a doer
If you want it done right,
do it yourself
Happiest when working
Knows you cant do two
things at once
Likes to control flow of
work
Thinking isnt work.
And is unproductive

The Entrepreneur
(Leader-Visionary)
Turns trivial conditions into
opportunities
The Dreamer and Catalyst for Change
Needs control
Lives in the world of what if and
if when
Creates Havoc because of need
for change
People are problems that get in the
way of his dream

The Manager
Pragmatic
Craves order
Clings to status quo
Sees problems not
opportunities
Creates neat rows of
widgets that
entrepreneur creates
Cleans up
Entrepreneurs Mess

Stages of Business
Infancy
Adolescent
Mature
Well Talk about each Stage

A Real Business APL

Landscape
Business we are going
to Talk about is
Wayne.
Landscape Solutions

Staff Profile
Wayne Anderson has been owner/manager of APL for 24 years. He is
active in the sales and design process. Wayne has been involved in the
green industry for 27 years starting out in lawn service and eventually
focusing solely on landscape installations. Wayne was an active foreman
until 2003. He earned his degree in business management at Ridgewater
College and continues his involvement with the college by giving lectures
to students. He is dedicated to continually growing APL, with emphasis on
quality and innovative installations.

Introduce Wayne
Real Person
Landscaping Business 17
years
Not making much money
Two Years behind with Tax
Returns
No Records Just a Shoe Box
Wore out from the Grind
Ready to Quit

Infancy stage of Business

Technician Stage of Business
Work long hours every day
Work comes and is too much.
Work each day on who screams loudest.
Always behind
Not enough time to bill - Vendors calling
for pay
Household has no money

Adolescence Stage
Stage where business
has to get help
They hire people but
do not have direction
Wayne had 8-10
workers
Missing the Manager
Hat
Working Harder and
making less money

Three Choices in
Adolescence
Get smaller - one employee
and eventually close doors
Add more employees and
go busted
Continue as IS and maybe
Survive but get BURNED
OUT
WAYNE SURVIVED FOR
17 YEARS AND WAS
READY TO QUIT

The Comfort Zone

Most businesses get outside their
comfort zone
Business or Job??
The Business no longer shines
Most businesses focus on the product
or Service not how the company does
business
Osborne Computerland Circuit City

Going for Broke-Turn over

Management

Demand for Services is larger than

can be handled
Hiring someone to handle the
business
Hiring an Employee to run the
business be the owner so the
owner can be a technician
Wont work!!!

Company is growing
or Shrinking
Either you do the job of the owner
or???
Cannot abdicate your role in a true
company
Business or Job???

Maturity Stage
Companies who know
how it got where it is
and know where it is
going.

E Myth Entrepreneurial Model

How did we get
Wayne to Maturity
Stage???
Look at the business
itself as a product
competing with
other businesses.
NOT looking at
whats done in the
business but HOW it
We need to find a business model that
is done.
satisfies all three of our personality
needs.

Entrepreneurial Perspective
How must the business work?
What work must be done?
System for producing results for
customer and profit for owner
Looks at the future(Technician
looks at the present)

Entrepreneur vs Technician
vs Manager Point of Views
Future vs Present
Where we will be not where we are
Entrepreneur visions and the
Technician only knows what he can
touch and see

Mature Model has parts of

Entrepreneur Technician
- Manager

Use the Turn Key Franchise Idea

The Franchise
Phenomena
McDonalds - The
most successful
small Business in
the world.

Franchises
Trade Name Franchises
Coca Cola - Cadillac

Business Format Franchise

An entire system of doing
business
TRUE PRODUCT OF THE
BUSINESS IS THE BUSINESS
ITSELF..
THE HAMBURGER WASNT
THE PRODUCT - THE
BUSINESS WAS..

Business Format
Franchises
95% Success Rate
in 1st Year
75% Success Rate
for Business
Format Franchises
in 5 Year Period
McDonalds: cleanliness - satisfy
the customers every time
Learned at Hamburger U

Business Format Franchise

Proprietary Way of Doing Business that
differentiates every Extra-ordinary
business from one of its competitors.
MAJOR QUESTIONS ARE:
How do we build businesses to make that idea work for us?
How do we make businesses that work predictably and
profitably every day?
How do we get business owners in control of their business
rather than the businesses controlling the
owner/manager???

We Created a Turn key

Business for Wayne

Created goals
Created Organization Structure
Hired a bookkeeper
Created schedule
Did last two years taxes
Created paperwork to track jobs
Created paperwork to track work on jobs

Your Business in Not Your Life!!!

A Business Owner
must understand
that the primary
purpose of a
business is that it
serve him/her not
that he/she serves
the business.

Work on
the
Business
Not in the
Business..

End Class 2
Next Meeting October 6 at 8 am
Reach Chap 7-9 in Emyth Revisited
A. Create an Organizational Chart??
B. Who is/are your manager/s?
C. Who are your technicians??

What do you do in the company??