I just finished reading the E-Myth. It is slightly interesting from a strict early retirement perspective but more interesting/recommend for anyone who is engaged in entrepreneurial activities; particularly if they are still learning and come out of a different background.

Incidentally, the E in E-myth has nothing to do with electronic as in electronic mail, it stands for entrepreneurial.

The book divides people into three kinds of persons

  • Technicians, who are the people who do the actual work. They write the papers, make the product, sell the product, etc. According to the E-Myth, technicians are present oriented.
  • Managers, who are the people who make sure that the other people actually do the work they are supposed to do. Not to much, not too little, but according to specifications. According to the E-Myth, managers are past oriented.
  • Entrepreneurs, who are the people who create the procedures that the managers implement. According to the E-Myth, entrepreneurs are future oriented.

A good startup should have all three characters, often in the same person. It is easy to see what can go wrong. A technician’s problem is that he builds the work he likes without considering the end-user (this is my personal problem). The managers problem is that he is useless without technicians or book or procedures to follow. Indeed a manager will expect miracles just by asking someone to do something. The problem with entrepreneurs is that they are visionaires but without technicians to do the work and managers to make sure that the ideas are implemented correctly, all visionaires are able to do is to sit around having great ideas.

From a personal perspective, I have seen all these things happen. I probably like the book, because someone has put into words what I always thought.

My lament when starting such (visionary) collaborations has always been: “We need a driver”. Someone needs to be responsible to make this happen and in my mind that person was always a combined technician/manager.

Many ideas have fallen by the wayside because drivers were never assigned. Meanwhile the entrepreneurs are mighty pleased with themselves because they think they have been very productive even though nothing real has been done, they organize a new meeting to have new ideas.

The second thing I took away from the book was to think of all startups as franchises even if they weren’t. This forces one to think of the business as a system and builds up the correct procedures rather than winging them. There is a strong tendency for the entrepreneur not to “waste” time formalizing the business but just doing what needs to get done. This, however, is the technician speaking. As soon as the business grows, there is trouble brewing.

I could actually think of ERE as a franchise. Not that I am getting paid fees, but in that ERE is or could or rather should be a system with a manual in that: “Use this method and do this the following way”. I have not written the book like this, but maybe I should have. Maybe I’ll write a second book. The 3021 day makeover is closer to this model.

The third thing to take away is to think of designing the business in the same way as a game. This point is not very elaborate, so I suspect it only triggered, because I have slowly been reading The Art of Game Design which is like the latticework bible of game design. Many of the ideas in this book transfer to the “real world”. I particular enjoyed Richard Bartle’s Players to Suit MUDs. I think you can build an entire management philosophy on that paper in terms of balancing your employees. Recommended for any HR manager 😉

Relevant Yakezie Posts: Best Small Business Ideas 2010 And Beyond @ Wealth Pilgrim & Transition From the Corporate World to Your Own Business – Lessons Learned @ Cool to be Frugal.

Originally posted 2010-05-23 10:14:13.