Monthly Archives: December 2009

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The Entrepreneurial Myth

I finished reading the The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It, a book that emphasizes the need to build an organized business with a turn-key model at its core. Michael Gerber’s other books on the E-Myth convey the same message across: Great people have a vision of their lives that they practice emulating each and every day. I enjoyed reading the book so I am posting some edited notes from it, hope you enjoy:

The system is the solution – AT&T

A business that relies on discretion, “How do I motivate my people?” raises the constant question. “How do I keep them in the mood?” It is literally impossible to produce a consistent result in a business that depends on extraordinary people. No business can do it for long. And no extraordinary business tries to!

The question you need to keep asking yourself is: How can I give my customer the results he wants systematically rather than personally? Put another way: How can I create a business whose results are systems-dependent rather than people-dependent? A systems dependent rather than expert-dependent.

Every extraordinary business realizes that when you intentionally build your business around the skills of ordinary people, you will be forced to ask the difficult questions about how to produce a result without the extraordinary ones.

You will be forced to find a system that leverages your ordinary people to the point where they can produce extraordinary results over and over again.

If your business depends on you, you don’t own a business — you have a job. And it’s the worst job in the world because you’re working for a lunatic!

The Entrepreneurial Model looks at a business as if it were a product, sitting on a shelf and competing for the customer’s attention against a whole shelf of competing products (or businesses). Said another way, the Entrepreneurial Model has less to do with what’s done in a business and more to do with how it’s done. The commodity isn’t what’s important — the way it’s delivered is.

A business that looks orderly says to your customer that your people know what you’re doing. A business that looks orderly says to your customer that he can trust in the result delivered and assures your people that they can trust in their future with you.

Most companies organize around personalities rather than around functions. That is, around people rather than accountabilities or responsibilities.

Opt to build a systems-dependent business, not a people-dependent business.

Drive Strategy with Tactics Behind the Wheel

Here is a short summary of some notes I took while reading “Bottom up Marketing” by Al Ries and Jack Trout (authors of Positioning and Marketing Warfare). They discuss the need for driving strategic objectives based on the information collected and executed at a more tactical level.

“The best strategic plan is useless”, said Field Marshal Erwin Rommel, “if it cannot be executed tactically”.

In business you tend to see what you expect to see. Which is why top-down thinking is so dangerous? You tend to overlook any factors that aren’t related to the success of your strategy.

The VW Beetle was not the first small car on the market, of course. But it was the first car to occupy the “small” position in the mind. It made a virtue out of its size, while the others apologized for their small size by talking about “roominess”. The position VW took was tactically informed while others made decisions based on the market’s strategic landscape.

In business as in warfare, the safest strategy is rapid exploitation of the tactic. The trick is to move quickly if you’re going to move at all, and come down with a ton of bricks when you do.

The true nature of business today is outwitting, outflanking, and outfighting the competition. Marketing is war, where the enemy is your competitor and the ground to be won is the customer. The key point is that marketing battles are first won or lost at the tactical level, not at the strategic level.