Book Review – The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It

On the John Lee Dumas’ podcast Entrepreneurs on Fire, the book The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It* has been recommended countless times. I have finally had the opportunity to sit down and read Michael Gerber’s book. I was definitely not disappointed. I would certainly recommend it to other business owners.

Gerber’s book is 268 pages long, spans three different sections, and has 19 different chapters. In his book, Gerber explained why most new businesses fail and offered recommendations for preventing this failure. The major sections are:

  • The E-Myth and American Small Business
  • The Turn-Key Revolution: A New View of Business
  • Building a Small Business That Works!

In his book, Gerber explained how most businesses fail and provided a recommended way for creating a business that would not fail. In each chapter, he presented information on the topic and then followed it with an unfolding story about a young entrepreneur who was struggling with her business. Throughout the book, he mentored her through the various steps of his process. This book is also an advertisement for his own business that sells this strategy. Nonetheless, I found the content to be quite applicable to what I was experiencing in my own business.

In the first section, e-myth and the American small business, Gerber talked about why most businesses fail. Essentially, new business owners begin with the wrong mindset. They start by working in their business as opposed to working on their business. They end up being technicians and workers in their business as opposed to building something that can be scaled, something that could be eventually sold as a turn-key business.

As I noted earlier, Gerber balanced each chapter with an explanation of the concepts but then followed it up with discussions with this young entrepreneur. In these discussions, he reiterated the key concepts but in a different manner. I found the use of storytelling to be helpful for getting the point across.

In the second section, Gerber talked about the idea of a turnkey business or what is better known as a franchise. He used McDonalds as an example throughout the book. He explained how everything belongs to a system. He outlined each part of the system starting with the vision of why the business was created to documenting the very specific processes and procedures that will help the business achieve those visions.

As I was reading this, I could see how my approach and his approach were very different. I was able to see the limiting factors in my approach. One of the big takeaways that I had was to formalize my business more by better documenting my processes.

In the last section on how to create a business that works, Gerber walked through different processes that you should develop in order to be successful. He started with documenting the business goals and vision. He also explained the importance of creating an organization chart along with position contracts for each job. Most importantly, he advised having a name placed in each position as well as sign each position contract, even if you were the only one in your business.  Once the contracts are signed,  the individual assigned to the job documents the processes and procedures for that job. Essentially, you are creating a business that could be made into a franchise. If you hand this over to someone else, they could be successful.

This idea of handing over my business to someone else and have them be successful is where I am failing. My business is not designed in that manner, so I have to rethink what I’m I doing and how I am doing it.

I now understand why this book was recommended so many times. Individuals who John Lee Dumas interviewed took the lessons to heart when crafting their businesses. If you are a business owner, The E-Myth Revisited will cause you to look at how your business operates in a different manner. I believe that you will find areas for improvement. I think The E-Myth Revisited is a book for all small business owners.


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