TheE-Myth

Revisited

WhyMostSmallBusinesses

Don’tWorkand

WhattoDoAboutIt

MICHAELE.GERBER

ToMyFather,

Iwishhewerehere.

CONTENTSAcknowledgments

Foreword

Introduction

PartI:TheE-MythandAmericanSmallBusiness

Chapter1.TheEntrepreneurialMyth

Chapter2.TheEntrepreneurtheManager,andtheTechnician

Chapter3.Infancy:TheTechnician’sPhase

Chapter4.Adolescence:GettingSomeHelp

Chapter5.BeyondtheComfortZone

Chapter6.MaturityandtheEntrepreneurialPerspective

PartII:TheTurn-KeyRevolution:ANewViewofBusiness

Chapter7.TheTurn-KeyRevolution

Chapter8.TheFranchisePrototype

Chapter9.WorkingOnYourBusiness,NotInIt

PartIII:BuildingaSmallBusinessThatWorks!

Chapter10.TheBusinessDevelopmentProcess

Chapter11.YourBusinessDevelopmentProgram

Chapter12.YourPrimaryAim

Chapter13.YourStrategicObjective

Chapter14.YourOrganizationalStrategy

Chapter15.YourManagementStrategy

Chapter16.YourPeopleStrategy

Chapter17.YourMarketingStrategy

Chapter18.YourSystemsStrategy

Chapter19.ALettertoSarah

Epilogue:BringingtheDreamBacktoAmericanSmallBusiness

Afterword:TakingtheFirstStep

AbouttheAuthor

OtherBooksbyMichaelE.Gerber

Copyright

AboutthePublisher

ACKNOWLEDGMENTS

IwouldliketoexpressmydeepestgratitudetothemanypeoplewithwhomI’veworkedtoproducetheideasthatarepresentedinthisbook,as

wellasforthesupportneededtocompleteit.

ToIleneGerber,mywife,partner,andeditor,withoutwhoseintensity

ofpurpose,dedicationtothetruth,andloveforthework,bothinour

businessandintherestofthelifewesharetogether,neitherthisbook,

ourbusiness,norourmarriagewouldhavebeenpossible.

ToShana,Kim,Hillary,Sam,andAlexOlivia,mychildren,whohave

giventomemorethantheyhavereceived,inwaysonlyafathercantruly

know.

ToallmyassociatesatE-MythWorldwide,presentandpast,whose

commitmenttotheideasinthisbook,aswellastoeachotherandour

clients,havegivenmeaningtothewordsbylivingthem,evenwhenitwas

impossibleandwhenthereseemedtobenogoodreasonfordoingso.

Toallourthousandsofclientsovertheyearswhohaveputtheirtrust

inourintegrity,and,intheprocess,caughtusatleastasmuchaswe

taughtthemaboutwhatitmeanstotranscendscarcitywithexcellence.

ToNancyandBobDreyfus,mysister-in-lawandbrother-in-law,

whosewisdom,love,andgenerousspiritshavetouchedmemorethan

theycanpossiblyknow.

ToVirginiaSmithatHarperBusiness,whosecaring,intelligent

friendshiphasseenmethroughthemostdismalmomentsofwritingwith

agentle,open,andwillingnaturethatenabledmetobemyselfinthe

momentsIleastwantedtobe,withoutapologyorexplanation.

And,finally,toallmyreaderswhocontinuetosupportmyworkso

enthusiastically.

Thankyouall.

FOREWORD

IthasbeenfifteenyearssinceTheE-Mythwasfirstpublished.Inmycase,fifteenfullyears.Alothashappenedintheinterim—withmyfamily,

mybusiness,mylife.Manywonderfulthings,manygoodthings,many

painfulthings.And,ifit’struewhatDonJuansaidinTalesofPower,that

“Thebasicdifferencebetweenanordinarymanandawarrioristhata

warriortakeseverythingasachallengewhileanordinarymantakes

everythingeitherasablessingoracurse,”thenIamasguiltyofbeingan

ordinarymanasthenextguy,and,onoccasion,haveascendedtothe

warriorstatewhenGodsawfittoprovidemewiththepower.

Inthesefifteenyears,Ihaveexperiencednearfinancialandbusiness

disasteraswellasincrediblevictories;havebuilta16-yearmarriageinto

anexquisitepartnershipwithmywife,Ilene;havebecomethefatherof

twoextraordinarychildren,SamandAlexOlivia(thetotalisnowfive,

agesnineyearstothirty-eightyears);haveenteredtheanointedstateof

grandfatherhoodthankstomydaughterKimandmyson-in-lawJohn,

whohaveblesseduswithSarah,Elijah,Noah,Hannah,andIsaiah;have

traveledthroughouttheworldspeakingtohundredsofthousandsof

smallbusinessownersinAustralia,Canada,Spain,NewZealand,Japan,

PuertoRico,Mexico,Indonesia,and,ofcourse,inalmosteverymajorcity

intheUnitedStates.And,throughitall,Ihavebeenthegratefulrecipient

ofunrestrainedsupportandcaringfrommanyofthosewhoselivesIhave

insomewaymanagedtotouchandwhosepathsIhavecrossed.

Inshort,theyearshavebeenexhilarating,challenging,frustrating,

exhausting,debilitating,boring,enlightening,rewarding,and,afterallis

saidanddone,ahandfulforanyone,especiallyforaguymyagewitha

penchantforgoingtothewallwithoutconcernforthedamageIdotothe

leadingpartsofmybody.

Thisbook,then,isaproductofthelastfifteenyears,aswellasa

productofthefifteenyearsthatprecededthem.Itwasalmostexactly

eightyearsbeforeTheE-MythwaspublishedthatIfoundedour

company,E-MythWorldwide,whichhasprovidedthefueland

experienceforthepointofviewIhavesharedwiththoseofyouwhohave

readTheE-Myth,andwiththoseofyouwhoareabouttoreadthisbook.

IntheyearssinceTheE-Mythwaspublished,manyofmyreaders—as

wellasmanyofoursmallbusinessclients—haveaskedmetoclarify

specificaspectsofTheE-Mythpointofviewsotheycouldbetterapplyit

totheirbusinesses.ThisbookanswersmanyquestionsthatTheE-Myth

hasraisedovertheyears,offeringbothnewandpreviousreadersthe

opportunitytoapproachtheirbusinesseswithrenewedvigoranda

sharpenedmindsetthroughanexpandedexperienceofTheE-Myth

principles.

Towardthatend,Ihaveattemptedtoanswerthemostimportant

questionsIhavebeenaskedabouttheprinciplescoveredineachchapter

bymeansofarunningdialoguewithawonderfulwomannamedSarah

(notherrealname)withwhomI’vespentquiteabitoftimeoverthepast

year.Sarah’sexperienceinbusiness,herpatience,intelligence,and

passionhavehelpedmetoaddressthechallengingissuesofoursmall

businessclientsinthereorganizationoftheirmindsaswellastheir

businesses.ItisinresponsetoSarah’sfrustrations,andherverypersonal

inquiry,thatIhaveendeavoredtoclarifyforthereadertheE-MythPoint

ofView.IhopethatSarahandherquestionsareasengagingtoyouas

theyhavebeentome.

But,beforeIintroduceyoutoSarah,I’dliketosharewithyousome

thoughtsaboutsmallbusinessesandthepeoplewhoownthem.

Thequestionhasoftenbeenaskedofme,“Whatdotheownersof

extraordinarybusinessesknowthattherestdon’t?”

Contrarytopopularbelief,myexperiencehasshownmethatthe

peoplewhoareexceptionallygoodinbusinessaren’tsobecauseofwhat

theyknowbutbecauseoftheirinsatiableneedtoknowmore.

TheproblemwithmostfailingbusinessesI’veencounteredisnotthat

theirownersdon’tknowenoughaboutfinance,marketing,management,

andoperations—theydon’t,butthosethingsareeasyenoughtolearn—

butthattheyspendtheirtimeandenergydefendingwhattheythinkthey

know.ThegreatestbusinesspeopleI’vemetaredeterminedtogetitright

nomatterwhatthecost.

Andbygettingitright,I’mnotjusttalkingaboutthebusiness.

Imeanthatthereissomethinguplifting,somevision,somehigher

endinsightthat“gettingitright”wouldserve.

Anethicalcertainty,amoralprinciple,auniversaltruth.

WhichisnottosaythatthoseI’minclinedtothinkofasextraordinary

wouldnecessarilycommunicateitthatway.Manycan’t.Eveniftheyhad

theinclination,theysimplydon’thavethewordsforit.Butit’sstillthere

allthesame.Youcanseeitintheireyes,feelitradiatingfromtheir

bodies,hearitinthetimbreoftheirvoices.

Ontheotherhand,notwithstandingthesearchfor“something

higher,”thebestofthebestIhaveknownareextraordinarilygrounded

people;theyarecompulsiveaboutdetail,pragmatic,down-to-earth,in

touchwiththeseamyrealityofordinarylife.Theyknowthatabusiness

doesn’tmissthemarkbyfailingtoachievegreatnessinsomelofty,

principledway,butinthestuffthatgoesonineverynookandcrannyof

thebusiness—onthetelephone,betweenthecustomerandasalesperson,

ontheshippingdock,atthecashregister.

AndsothegreatonesIhaveknownseemtopossessanintuitive

understandingthattheonlywaytoreachsomethinghigheristofocus

theirattentiononthemultitudeofseeminglyinsignificant,unimportant,

andboringthingsthatmakeupeverybusiness.(Andthatmakeupevery

life,forthatmatter!)

Thosemundaneandtediouslittlethingsthat,whendoneexactly

right,withtherightkindofattentionandintention,formintheir

aggregateadistinctiveessence,anevanescentqualitythatdistinguishes

everygreatbusinessyou’veeverdonebusinesswithfromitsmore

mediocrecounterpartswhoseownersaresatisfiedtosimplygetthrough

theday.

Yes,thesimpletruthaboutthegreatestbusinesspeopleIhaveknown

isthattheyhaveagenuinefascinationforthetrulyastonishingimpact

littlethingsdoneexactlyrightcanhaveontheworld.

Itistothatfascinationthatthisbookisdedicated.

Thisbookisaguideforthosewhoseethedevelopmentofan

extraordinarybusinessasanever-endinginquiry,anongoing

investigation,anactiveengagementwithaworldofforces,withinusand

without,thatcontinuallyamazeandconfoundthetrueseekersamongus

withawesomevariety,unendingsurprises,anduntoldcomplexity.

Whileitmayseemobvious,thisfascinationwiththedevelopmentof

anextraordinarybusinessisnotthesameasafascinationwithsuccess.

Certainlynotthesuccesswenormallythinkof.Someendpoint

which,havingreachedit,enablesonetosay,“1didit!”Becausemy

experiencehastaughtmeonlytoowellthatendpointsinthe

developmentofanextraordinarybusinessareinstantlyreplacedby

beginningpoints.

So,thisbookisnotaboutendings,butaboutbeginnings,aboutthe

never-endinggame,thedelightfulandexhilaratingprocess,the

continuousevolutionofoursenses,ofourconsciousness—ofour

humanness—whichonlycomesfrombeingpresentinthemoment,from

beingattentivetowhat’sgoingon.

Ibelievethatourbusinesscanprovideuswithamirrortosee

ourselvesasweare,toseewhatwetrulyknowandwhatwedon’tknow,

toseeourselveshonestly,directly,andimmediately.

Ibelievethatourbusinesscanbecomeanexcitingmetaphorfor“The

Way.”

Awisepersononcesaid,“Knowthyself.”TothathonorabledictumI

canonlyaddforthebusinesspersononthepathofdiscovery,good

travelingandgoodluck.

Imightalsoaddafewinstructivewordsfromanotherwiseman,

AnthonyGreenbank,whosaidinTheBookofSurvival,“Tolivethrough

animpossiblesituation,youdon’tneedthereflexesofaGrandPrix

driver,themusclesofaHercules,themindofanEinstein.Yousimply

needtoknowwhattodo.”

Goodreading.

MichaelE.Gerber

SantaRosa,California

June,2001

INTRODUCTIONIthinkthatmaybeinsideanybusiness,thereissomeoneslowly

goingcrazy.

JosephHeller

SomethingHappened

Ifyouownasmallbusiness,orifyouwanttoownasmallbusiness,thisbookwaswrittenforyou.

ItrepresentsmanythousandsofhoursofworkwehavedoneatE-

MythWorldwideoverthepasttwenty-fouryears.

Itillustratesabelief,createdandsupportedbytheexperienceswe

havehadwiththethousandsofsmallbusinessownerswithwhomwe’ve

worked.

ItisabeliefthatsayssmallbusinessesintheUnitedStatessimplydo

notwork;thepeoplewhoownthemdo.

Andwhatwehavealsodiscoveredisthatthepeoplewhoownsmall

businessesinthiscountryworkfaxmorethantheyshouldforthereturn

they’regetting.

Indeed,theproblemisnotthattheownersofsmallbusinessesinthis

countrydon’twork;theproblemisthatthey’redoingthewrongwork.

Asaresult,mostoftheirbusinessesendupinchaos—unmanageable,

unpredictable,andunrewarding.

Justlookatthenumbers.

BusinessesstartandfailintheUnitedStatesatanincreasingly

staggeringrate.Everyyear,overamillionpeopleinthiscountrystarta

businessofsomesort.Statisticstellusthatbytheendofthefirstyearat

least40percentofthemwillbeoutofbusiness.1

Withinfiveyears,morethan80percentofthem—800,000—willhave

failed.

Andtherestofthebadnewsis,ifyouownasmallbusinessthathas

managedtosurviveforfiveyearsormore,don’tbreatheasighofrelief.

Becausemorethan80percentofthesmallbusinessesthatsurvivethe

firstfiveyearsfailinthesecondfive.

Whyisthis?

Whydosomanypeoplegointobusiness,onlytofail?

Whatlessonaren’ttheylearning?

Whyisitthatwithalltheinformationavailabletodayonhowtobe

successfulinsmallbusiness,sofewpeoplereallyare?

Thisbookanswersthosequestions.

It’saboutfourprofoundideas,which,ifyouunderstandandtake

themtoheart,willgiveyouthepowertocreateanextraordinarily

exciting,andpersonallyrewarding,smallbusiness.

Ignorethem,andyouwilllikelyjointhehundredsofthousandsof

peopleeveryyearwhopourtheirenergyandcapital—andlife—into

startingasmallbusinessandfail,orthemanyotherswhostrugglealong

foryearssimplytryingtosurvive.

IDEA#1Thereisamythinthiscountry—IcallittheE-Myth—which

saysthatsmallbusinessesarestartedbyentrepreneursriskingcapitalto

makeaprofit.Thisissimplynotso.Therealreasonspeoplestart

businesseshavelittletodowithentrepreneurship.Infact,thisbeliefin

theEntrepreneurialMythisthemostimportantfactorinthedevastating

rateofsmallbusinessfailuretoday.UnderstandingtheE-Myth,and

applyingthatunderstandingtothecreationanddevelopmentofasmall

business,canbethesecrettoanybusiness’ssuccess.

IDEA#2There’sarevolutiongoingontodayinAmericansmall

business.IcallittheTurn-KeyRevolution.Notonlyisitchangingthe

waywedobusinessinthiscountryandthroughouttheworldbutitis

changingwhogoesintobusiness,howtheydoit,andthelikelihoodof

theirsurvival.

IDEA#3AttheheartoftheTurn-KeyRevolutionisadynamic

processweatE-MythWorldwidecalltheBusinessDevelopmentProcess.

Whenitissystematizedandappliedpurposelybyasmallbusinessowner,

theBusinessDevelopmentProcesshasthepowertotransformanysmall

businessintoanincrediblyeffectiveorganization.Ourexperiencehas

shownusthatwhenasmallbusinessincorporatesthisprocessintoits

everyactivityandusesittocontrolitsdestiny,thatcompanystaysyoung

andthrives.Whenasmallbusinessignoresthisprocess—asmost

unfortunatelydo—itcommitsitselftoManagementbyLuck,stagnation,

and,ultimately,failure.Theconsequencesareinevitable.

IDEA#4TheBusinessDevelopmentProcesscanbesystematically

appliedbyanysmallbusinessownerinastep-by-stepmethodthat

incorporatesthelessonsoftheTurn-KeyDevolutionintotheoperationof

thatbusiness.Thisprocessthenbecomesapredictablewaytoproduce

resultsandvitalityinanysmallbusinesswhoseowneriswillingtogiveit

thetimeandattentionitrequirestoflourish.

SincethefoundingofE-MythWorldwidein1977,wehaveassisted

over25,000smallbusinessownerswiththeimplementationofour

BusinessDevelopmentProcessthroughtheirenrollmentinouruniqueE-

MythMasteryProgramTM,andIhaveseenitsucceedthousandsof

times.

Iwouldventuretoguessthatnoorganizationhashadmoredirect

experienceapplyingthelessonsoftheTurn-KeyRevolutionandthe

BusinessDevelopmentProcesstothedevelopmentofasmallbusiness

thanwehavehadatE-MythWorldwide.And,whiletheprocessisno

“magicbullet”anddoesrequirehardwork,itisalwaysgratifyingwork

andtheonlyworkIknowthatwillgiveyouthelevelofcontrolyouneed

togetwhatyouwantfromyoursmallbusiness.Indeed,itwillchange

yourbusinessanditwillchangeyourlife.

Thisbook,then,isaboutproducingresults—notsimply“howtodoit.”

Becausebothofusknowthatbookslikethatdon’twork.Peopledo.

Andwhatmakespeopleworkisanideaworthworkingfor,alongwith

aclearunderstandingofwhatneedstobedone.

Itisonlywhensuchanideabecomesfirmlyintegratedintotheway

youthinkandoperateyourbusinessthat“howtodoit”becomes

meaningful.

Thisbookisaboutsuchanidea—anideathatsaysyourbusinessis

nothingmorethanadistinctreflectionofwhoyouare.

Ifyourthinkingissloppy,yourbusinesswillbesloppy.

Ifyouaredisorganized,yourbusinesswillbedisorganized.

Ifyouaregreedy,youremployeeswillbegreedy,givingyoulessand

lessofthemselvesandalwaysaskingformore.

Ifyourinformationaboutwhatneedstobedoneinyourbusinessis

limited,yourbusinesswillreflectthatlimitation.

Soifyourbusinessistochange—asitmustcontinuouslytothrive—

youmustchangefirst.Ifyouareunwillingtochange,yourbusinesswill

neverbecapableofgivingyouwhatyouwant.

Thefirstchangethatneedstotakeplacehastodowithyourideaof

whatabusinessreallyisandwhatittakestomakeonework.

Onceyoufullyunderstandtherelationshipeveryownermusthave

withhisorherbusinessifitistowork,Icanassureyouthatyour

businessandyourlifewilltakeonnewvitalityandnewmeaning.

You’llknowwhysomanypeoplefailtogetwhattheywantfroma

businessoftheirown.

You’llseethealmostmagicalopportunitiesavailabletoanyonewho

startsasmallbusinessintherightway,withatrueunderstanding,with

thenecessarytools.

I’veseenithappenthousandsoftimes,ineverykindofbusiness

imaginable,withpeoplewhoknewnothingaboutbusinesswhenthey

started.

Mywishisthatbythetimeyouarethroughreadingthisbook,itwill

havestartedtohappentoyou.

1

PARTI

TheE-MythandAmericanSmallBusiness

1THEENTREPRENEURIALMYTH

Theyintoxicatethemselveswithworksotheywon’tseehowthey

reallyare.

AldousHuxley

TheE-Mythisthemythoftheentrepreneur.Itrunsdeepinthiscountry

andringsoftheheroic.

PicturethetypicalentrepreneurandHerculeanpicturescometo

mind:amanorwomanstandingalone,wind-blownagainsttheelements,

bravelydefyinginsurmountableodds,climbingsheerfacesoftreacherous

rock—alltorealizethedreamofcreatingabusinessofone’sown.

Thelegendreeksofnobility,oflofty,extra-humanefforts,ofa

prodigiouscommitmenttolarger-than-lifeideals.

Well,whiletherearesuchpeople,myexperiencetellsmetheyare

rare.

OfthethousandsofbusinesspeopleIhavehadtheopportunityto

knowandworkwithoverthepasttwodecades,fewwerereal

entrepreneurswhenImetthem.

Thevisionwasallbutgoneinmost.

Thezestfortheclimbhadturnedintoaterrorofheights.

Thefaceoftherockhadbecomesomethingtoclingtoratherthanto

scale.

Exhaustionwascommon,exhilarationrare.

Buthadn’tallofthemoncebeenentrepreneurs?Afterall,theyhad

startedtheirownbusiness.Theremusthavebeensomedreamthatdrove

themtotakesucharisk.

But,ifso,wherewasthedreamnow?Whyhaditfaded?

Wherewastheentrepreneurwhohadstartedthebusiness?

Theanswerissimple:theentrepreneurhadonlyexistedfora

moment.

Afleetingsecondintime.

Andthenitwasgone.Inmostcases,forever.

Iftheentrepreneursurvivedatall,itwasonlyasamyththatgrewout

ofamisunderstandingaboutwhogoesintobusinessandwhy.

Amisunderstandingthathascostusdearlyinthiscountry—more

thanwecanpossiblyimagine—inlostresources,lostopportunities,and

wastedlives.

Thatmyth,thatmisunderstanding,IcalltheE-Myth,themythofthe

entrepreneur.

Anditfindsitsrootsinthiscountryinaromanticbeliefthatsmall

businessesarestartedbyentrepreneurs,when,infact,mostarenot.

ThenwhodoesstartsmallbusinessesinAmerica?

Andwhy?

TheEntrepreneurialSeizure

TounderstandtheE-Mythandthemisunderstandingatitscore,let’s

takeacloserlookatthepersonwhogoesintobusiness.Notafterhegoes

intobusiness,butbefore.

Forthatmatter,wherewereyoubeforeyoustartedyourbusiness?

And,ifyou’rethinkingaboutgoingintobusiness,whereareyounow?

Well,ifyou’relikemostofthepeopleI’veknown,youwereworking

forsomebodyelse.

Whatwereyoudoing?

Probablytechnicalwork,likealmosteverybodywhogoesinto

business.

Youwereacarpenter,amechanic,oramachinist.

Youwereabookkeeperorapoodleclipper;adrafts-personora

hairdresser;abarberoracomputerprogrammer;adoctororatechnical

writer;agraphicartistoranaccountant;aninteriordesignerora

plumberorasalesperson.

Butwhateveryouwere,youweredoingtechnicalwork.

Andyouwereprobablydamngoodatit.

Butyouweredoingitforsomebodyelse.

Then,oneday,fornoapparentreason,somethinghappened.Itmight

havebeentheweather,abirthday,oryourchild’sgraduationfromhigh

school.ItmighthavebeenthepaycheckyoureceivedonaFriday

afternoon,orasidewaysglancefromthebossthatjustdidn’tsitright.It

mighthavebeenafeelingthatyourbossdidn’treallyappreciateyour

contributiontothesuccessofhisbusiness.

Itcouldhavebeenanything;itdoesn’tmatterwhat.Butoneday,for

apparentlynoreason,youweresuddenlystrickenwithan

EntrepreneurialSeizure.Andfromthatdayonyourlifewasnevertobe

thesame.

Insideyourminditsoundedsomethinglikethis:“WhatamIdoing

thisfor?WhyamIworkingforthisguy?Hell,Iknowasmuchaboutthis

businessashedoes.Ifitweren’tforme,hewouldn’thaveabusiness.Any

dummycanrunabusiness.I’mworkingforone.”

Andthemomentyoupaidattentiontowhatyouweresayingand

reallytookittoheart,yourfatewassealed.

Theexcitementofcuttingthecordbecameyourconstantcompanion.

Thethoughtofindependencefollowedyoueverywhere.

Theideaofbeingyourownboss,doingyourownthing,singingyour

ownsong,becameobsessivelyirresistible.

OnceyouwerestrickenwithanEntrepreneurialSeizure,therewasno

relief.

Youcouldn’tgetridofit.

Youhadtostartyourownbusiness.

TheFatalAssumption

InthethroesofyourEntrepreneurialSeizure,youfellvictimtothe

mostdisastrousassumptionanyonecanmakeaboutgoingintobusiness.

Itisanassumptionmadebyalltechnicianswhogointobusinessfor

themselves,onethatchartsthecourseofabusiness—fromGrand

OpeningtoLiquidation—themomentitismade.

ThatFatalAssumptionis:ifyouunderstandthetechnicalworkofa

business,youunderstandabusinessthatdoesthattechnicalwork.

Andthereasonit’sfatalisthatitjustisn’ttrue.

Infact,it’stherootcauseofmostsmallbusinessfailures!

Thetechnicalworkofabusinessandabusinessthatdoesthat

technicalworkaretwototallydifferentthings!

Butthetechnicianwhostartsabusinessfailstoseethis.

TothetechniciansufferingfromanEntrepreneurialSeizure,a

businessisnotabusinessbutaplacetogotowork.

Sothecarpenter,ortheelectrician,ortheplumberbecomesa

contractor.

Thebarberopensupabarbershop.

Thetechnicalwriterstartsatechnicalwritingbusiness.

Thehairdresserstartsabeautysalon.

Theengineergoesintothesemiconductorbusiness.

Themusicianopensupamusicstore.

Allofthembelievingthatbyunderstandingthetechnicalworkofthe

businesstheyareimmediatelyandeminentlyqualifiedtorunabusiness

thatdoesthatkindofwork.

Andit’ssimplynottrue!

Infact,ratherthanbeingtheirgreatestsingleasset,knowingthe

technicalworkoftheirbusinessbecomestheirgreatestsingleliability.

Forifthetechniciandidn’tknowhowtodothetechnicalworkofthe

business,hewouldhavetolearnhowtogetitdone.

Hewouldbeforcedtolearnhowtomakethebusinesswork,rather

thantodotheworkhimself.

TherealtragedyisthatwhenthetechnicianfallspreytotheFatal

Assumption,thebusinessthatwassupposedtofreehimfromthe

limitationsofworkingforsomebodyelseactuallyenslaveshim.

Suddenlythejobheknewhowtodosowellbecomesonejobhe

knowshowtodoplusadozenothershedoesn’tknowhowtodoatall.

BecausealthoughtheEntrepreneurialSeizurestartedthebusiness,

it’sthetechnicianwhogoestowork.

Andsuddenly,anentrepreneurialdreamturnsintoatechnician’s

nightmare.

SeetheyoungWomanBankingPies.

SeetheYoungWomanStartaBusinessBakingPies.

SeetheYoungWomanBecomeanOldWoman.

ImetSarahaftershehadbeeninbusinessforthreeyears.Shetold

me,“Theyhavebeenthelongestthreeyearsofmylife.”

Sarah’sbusinesswasnamedAllAboutPies(notitsrealname).

But,intruth,Sarah’sbusinesswasn’treallyallaboutpies—itwas

reallyallaboutwork.TheworkSarahdid.TheworkSarahusedtoloveto

domorethananythingelse.PlustheworkSarahhadneverdoneinher

life.

“Infact,”Sarahsaidtome,“notonlydoIhatetodoallthis[she

spreadherarms,takinginthesmallshopinwhichwestood]butIhate

[sheemphasizedthewordalmostfiercely]—Ihatebakingpies.Ican’t

standthethoughtofpies.Ican’tstandthesmellofpies.Ican’tstandthe

sightofpies.”Andthenshestartedcrying.

Thesweetfresharomaofpiesfilledtheair.

Itwas7A.M.andAllAboutPieswastoopeninthirtyminutes.But

Sarah’smindwassomeplaceelse.

“It’sseveno’clock,”shesaid,wipinghereyeswithherapron,as

thoughreadingmymind.“DoyourealizeI’vebeenheresincethree

o’clockthismorning?AndthatIwasupattwotogetready?Andthatby

thetimeIgetthepiesready,openforbusiness,takecareofmy

customers,cleanup,closeup,dotheshopping,reconcilethecash

register,gotothebank,havedinner,andgetthepiesreadyfor

tomorrow’sbake,it’llbenine-thirtyorteno’clocktonight,andbythe

timeIdoallthat,bythetimeanynormalperson,forGod’ssake,would

saythatthedaywasdone,Iwillthenalsoneedtositdownandbeginto

figureouthowI’mgoingtopaytherentnextmonth?

“Andallthis[shespreadherarmswearilyagain,asthoughto

accentuateeverythingshehadjustsaid]becausemyverybestfriendstold

meIwascrazynottoopenapieshopbecauseIwassodamngoodatit?

And,what’sworse,Ibelievedthem!IsawawayoutofthehorriblejobI

usedtohave.Isawawaytogetfree,doingworkIlovedtodo,anddoing

itallforme.”

ShewasonatearthatIdidn’twanttointerrupt.Iwaitedquietlyto

hearwhatshewouldsaynext.

Instead,shekickedthehugeblackoveninfrontofherwithherright

foot.

“Damn!”sheexploded.

“Damn,Damn,Damn!”

Foremphasis,shekickedtheovenagain.Andthenslumped,sighed

deeply,andhuggedherself,almostdesperately.

“WhatdoIdonow?”shesaid,almostinawhisper.Notreallyasking

me,Iknew,butaskingherself.

Sarahleanedagainstthewallandremainedtherequietlyforalong

moment,staringatherfeet.Thelargeclockonthewalltickedloudlyin

theemptyshop.Icouldhearthecarsdrivingbyonthebusystreetin

frontoftheshopasthecitycameawake.Thesunshoneharshlythrough

thespotlesswindows,sweepingthegleamingoakfloorinfrontofthe

counter.

Icouldseethedustinthestreamoflight,hangingsuspendedas

thoughwaitingforSarahtospeak.

Shewasdeepindebt.

Shehadspenteverythingshehad,andmore,tocreatethislovelylittle

shop.

Thefloorswerethebestoak.

Theovenswerethebestovens.

Thedisplayswerecharming,theverybestmoneycouldbuy.

Shehadputherheartintothisplace,justasshehadputherheart

intoherpies,fallinginlovewithbakingasayounggirl,mentoredbyher

auntwhohadlivedwithherfamilywhileSarahwasgrowingup.

Heraunthadfilledherfamily’skitchen,Sarah’schildhood,withthe

delicious,sweetaromaoffreshlybakedpies.Heraunthadintroducedher

tothemagicoftheprocess:thekneadingofthedough,thecleaningofthe

oven,thesprinklingoftheflour,thepreparationofthetrays,thecareful

cuttingoftheapples,thecherries,therhubarb,thepeaches.Itwasa

laboroflove.

Heraunthadcorrectedherwhen,inherhaste,Sarahhadhurriedthe

process.

Heraunthadtoldher,timeandtimeagain,“Sarah,dear,wehaveall

thetimeintheworld.Bakingpiesisnotaboutgettingdone.It’sabout

bakingpies.”

AndSarahthoughtsheunderstoodher.

ButnowSarahknewthatbakingpieswasabout“gettingdone.”

Bakingpieswasruinedforher.Atleastshethoughtitwas.

Theclockcontinueditsemphaticticking.

IwatchedasSarahseemedtoshrinkevenclosertoherself.

Iknewhowoppressiveitmustbeforhertofindherselfsodeeplyin

debt,tofeelsohelplessinthefaceofit.Wherewasherauntnow?Who

wasgoingtoteachherwhattodonext?

“Sarah,”IsaidascarefullyasIcould.

“It’stimetolearnallaboutpiesalloveragain.”

ThetechniciansufferingfromanEntrepreneurialSeizuretakesthework

helovestodoandturnsitintoajob.Theworkthatwasbornoutoflove

becomesachore,amongawelterofotherlessfamiliarandlesspleasant

chores.Ratherthanmaintainingitsspecialness,representingtheunique

skillthetechnicianpossessesanduponwhichhestartedthebusiness,the

workbecomestrivialized,somethingtogetthroughinordertomake

roomforeverythingelsethatmustbedone.

ItoldSarahthateverytechniciansufferingfromanEntrepreneurial

Seizureexperiencesexactlythesamething.

First,exhilaration;second,terror;third,exhaustion;and,finally,

despair.Aterriblesenseofloss—notonlythelossofwhatwasclosestto

them,theirspecialrelationshipwiththeirwork,butthelossofpurpose,

thelossofself.

Sarahlookedatmewithasenseofrelief,asthoughshefeltseenbut

notjudged.

“You’vegotmynumber,”shesaid.“ButwhatdoIdonow?”

“Youtakethisonestepatatime,”Ianswered.

“Thetechnicianisn’ttheonlyproblemyou’vegottodealwithhere.”

2THEENTREPRENEUR,THEMANAGER,

ANDTHETECHNICIANThus,inthecourseofhislife,onemanacquiresmanypersonal

qualities,manypersonages,many‘I’s’(becauseeach,speakingfor

itselfindependentlyoftheotherssays‘I,’‘me,’whenitappears).

JeanVaysse

TowardAwakening

No,TheTechnicianisn’ttheonlyproblem.

Theproblemismorecomplicatedthanthat.

Theproblemisthateverybodywhogoesintobusinessisactually

three-people-in-one:TheEntrepreneur,TheManager,andThe

Technician.

Andtheproblemiscompoundedbythefactthatwhileeachofthese

personalitieswantstobetheboss,noneofthemwantstohaveaboss.

Sotheystartabusinesstogetherinordertogetridoftheboss.And

theconflictbegins.

Toshowyouhowtheproblemmanifestsitselfinallofus,let’s

examinethewayourvariousinternalpersonalitiesinteract.Let’stakea

lookattwopersonalitieswe’reallfamiliarwith:TheFatGuyandThe

SkinnyGuy.

Haveyoueverdecidedtogoonadiet?

You’resittinginfrontofthetelevisionsetoneSaturdayafternoon,

watchinganathleticcompetition,awedbytheathletes’staminaand

dexterity.

You’reeatingasandwich,yoursecondsinceyousatdowntowatch

theeventtwohoursbefore.

You’refeelingsluggishinthefaceofalltheactiononthescreenwhen,

suddenly,somebodywakesupinyouandsays,“Whatareyoudoing?

Lookatyourself,You’reFat!You’reoutofshape!Dosomethingaboutit!”

Ithashappenedtousall.Somebodywakesupinsideuswithatotally

differentpictureofwhoweshouldbeandwhatweshouldbedoing.In

thiscase,let’scallhimTheSkinnyGuy.

Who’sTheSkinnyGuy?He’stheonewhouseswordslikediscipline,

exercise,organization.TheSkinnyGuyisintolerant,self-righteous,a

sticklerfordetail,acompulsivetyrant.

TheSkinnyGuyabhorsfatpeople.Can’tstandsittingaround.Needs

tobeonthemove.Livesforaction.

TheSkinnyGuyhasjusttakenover.Watchout—thingsareaboutto

change.

Beforeyouknowit,you’recleaningallthefatteningfoodsoutofthe

refrigerator.You’rebuyinganewpairofrunningshoes,barbells,and

sweats.Thingsaregoingtobedifferentaroundhere.Youhaveanew

leaseonlife.Youplanyournewphysicalregimen:upatfive,runthree

miles,coldshoweratsix,abreakfastofwheattoast,blackcoffee,andhalf

agrapefruit;then,rideyourbicycletowork,homebyseven,runanother

twomiles,tobedatten—theworld’salreadyadifferentplace!

Andyouactuallypullitoff!ByMondaynight,you’velosttwopounds.

YougotosleepdreamingofwinningtheBostonMarathon.Whynot?The

waythingsaregoing,it’sonlyamatteroftime.

Tuesdaynightyougetonthescale.Anotherpoundgone!You’re

incredible.Gorgeous.Aleanmachine.

OnWednesday,youreallypouriton.Youworkoutanextrahourin

themorning,anextrahalf-houratnight.

Youcan’twaittogetonthescale.Youstripdowntoyourbareskin,

shiveringinthebathroom,filledwithexpectationofwhatyourscaleis

goingtotellyou.Yousteplightlyontoitandlookdown.Whatyousee

is…nothing.Youhaven’tlostanounce.You’reexactlythesameasyou

wereonTuesday.

Dejectioncreepsin.Youbegintofeelaslighttwingeofresentment.

“Afterallthatwork?Afterallthatsweatandeffort?Andthen—nothing?

Itisn’tfair.”Butyoushrugitoff.Afterall,tomorrow’sanotherday.You

gotobed,vowingtoworkharderonThursday.Butsomehowsomething

haschanged.

Youdon’tknowwhat’schangeduntilThursdaymorning.

It’sraining.

Theroomiscold.

Somethingfeelsdifferent.

Whatisit?

Foraminuteortwoyoucan’tquiteputyourfingeronit.

Andthenyougetit:somebodyelseisinyourbody.

It’sTheFatGuy!

He’sback!

Andhedoesn’twanttorun.

Asamatteroffact,hedoesn’tevenwanttogetoutofbed.It’scold

outside.“Run?Areyoukiddingme?”TheFatGuydoesn’twantanything

todowithit.Theonlyexercisehemightbeinterestediniseating!

Andallofasuddenyoufindyourselfinfrontoftherefrigerator

—insidetherefrigerator—alloverthekitchen!

Foodisnowyourmajorinterest.

TheMarathonisgone;theleanmachineisgone;thesweatsand

barbellsandrunningshoesaregone.

TheFatGuyisback.He’srunningtheshowagain.

Ithappenstoallofus,timeandtimeagain.Becausewe’vebeen

deludedintothinkingwe’rereallyoneperson.

AndsowhenTheSkinnyGuydecidestochangethingsweactually

believethatit’sIwho’smakingthatdecision.

AndwhenTheFatGuywakesupandchangesitallbackagain,we

thinkit’sIwho’smakingthatdecisiontoo.

Butitisn’tI.It’swe.

TheSkinnyGuyandTheFatGuyaretwototallydifferent

personalities,withdifferentneeds,differentinterests,anddifferent

lifestyles.

That’swhytheydon’tlikeeachother.Theyeachwanttotallydifferent

things.

Theproblemisthatwhenyou’reTheSkinnyGuy,you’retotally

consumedbyhisneeds,hisinterests,hislifestyle.

Andthensomethinghappens—thescaledisappointsyou,theweather

turnscold,somebodyoffersyouahamsandwich.

Atthatmoment,TheFatGuy,who’sbeenwaitinginthewingsallthis

time,grabsyourattention.Grabscontrol.

You’rehimagain.

Inotherwords,whenyou’reTheSkinnyGuyyou’realwaysmaking

promisesforTheFatGuytokeep.

Andwhenyou’reTheFatGuy,you’realwaysmakingpromisesforThe

SkinnyGuytokeep.

Isitanywonderwehavesuchatoughtimekeepingourcommitments

toourselves?

It’snotthatwe’reindecisiveorunreliable;it’sthateachandeveryone

ofusisawholesetofdifferentpersonalities,eachwithhisowninterests

andwayofdoingthings.Askinganyoneofthemtodefertoanyofthe

othersisinvitingabattleorevenafull-scalewar.

AnyonewhohaseverexperiencedtheconflictbetweenTheFatGuy

andTheSkinnyGuy(andhaven’tweall?)knowswhatImean.Youcan’t

beboth;oneofthemhastolose.Andtheybothknowit.

Well,that’sthekindofwargoingoninsidetheownerofeverysmall

business.

Butit’sathree-waybattlebetweenTheEntrepreneur,TheManager,

andTheTechnician.

Unfortunately,it’sabattlenoonecanwin.

Understandingthedifferencesbetweenthemwillquicklyexplain

why.

TheEntrepreneur

Theentrepreneurialpersonalityturnsthemosttrivialconditioninto

anexceptionalopportunity.TheEntrepreneuristhevisionaryinus.The

dreamer.Theenergybehindeveryhumanactivity.Theimaginationthat

sparksthefireofthefuture.Thecatalystforchange.

TheEntrepreneurlivesinthefuture,neverinthepast,rarelyinthe

present.He’shappiestwhenleftfreetoconstructimagesof“what-if”and

“if-when.”

Inscience,theentrepreneurialpersonalityworksinthemostabstract

andleastpragmaticareasofparticlephysics,puremathematics,and

theoreticalastronomy.Inart,itthrivesintherarefiedarenaoftheavant-

garde.Inbusiness,TheEntrepreneuristheinnovator,thegrand

strategist,thecreatorofnewmethodsforpenetratingorcreatingnew

markets,theworld-bendinggiant—likeSearsRoebuck,HenryFord,Tom

WatsonofIBM,andRayKrocofMcDonald’s.

TheEntrepreneurisourcreativepersonality—alwaysatitsbest

dealingwiththeunknown,proddingthefuture,creatingprobabilitiesout

ofpossibilities,engineeringchaosintoharmony.

Everystrongentrepreneurialpersonalityhasanextraordinaryneed

forcontrol.Livingashedoesinthevisionaryworldofthefuture,he

needscontrolofpeopleandeventsinthepresentsothathecan

concentrateonhisdreams.

Givenhisneedforchange,TheEntrepreneurcreatesagreatdealof

havocaroundhim,whichispredictablyunsettlingforthoseheenlistsin

hisprojects.

Asaresult,heoftenfindshimselfrapidlyoutdistancingtheothers.

Thefartheraheadheis,thegreatertheeffortrequiredtopullhis

cohortsalong.

Thisthenbecomestheentrepreneurialworldview:aworldmadeupof

bothanoverabundanceofopportunitiesanddraggingfeet.

Theproblemis,howcanhepursuetheopportunitieswithoutgetting

mireddownbythefeet?

Thewayheusuallychoosesistobully,harass,excoriate,flatter,

cajole,scream,andfinally,whenallelsefails,promisewhateverhemust

tokeeptheprojectmoving.

ToTheEntrepreneur,mostpeopleareproblemsthatgetinthewayof

thedream.

TheManager

Themanagerialpersonalityispragmatic.WithoutTheManagerthere

wouldbenoplanning,noorder,nopredictability.

TheManageristhepartofusthatgoestoSearsandbuysstacking

plasticboxes,takesthembacktothegarage,andsystematicallystoresall

thevarioussizednuts,bolts,andscrewsintheirowncarefullyidentified

drawer.Hethenhangsallofthetoolsinimpeccableorderonthewalls—

lawntoolsononewall,carpentrytoolsonanother—and,tobeabsolutely

certainthatorderisnotdisturbed,paintsapictureofeachtoolonthe

wallwhereithangs!

IfTheEntrepreneurlivesinthefuture,TheManagerlivesinthepast.

WhereTheEntrepreneurcravescontrol,TheManagercravesorder.

WhereTheEntrepreneurthrivesonchange,TheManager

compulsivelyclingstothestatusquo.

WhereTheEntrepreneurinvariablyseestheopportunityinevents,

TheManagerinvariablyseestheproblems.

TheManagerbuildsahouseandthenlivesinit,forever.

TheEntrepreneurbuildsahouseandtheinstantit’sdonebegins

planningthenextone.

TheManagercreatesneat,orderlyrowsofthings.TheEntrepreneur

createsthethingsTheManagerputsinrows.

TheManageristheonewhorunsafterTheEntrepreneurtocleanup

themess.WithoutTheEntrepreneurtherewouldbenomesstocleanup.

WithoutTheManager,therecouldbenobusiness,nosociety.

WithoutTheEntrepreneur,therewouldbenoinnovation.

ItisthetensionbetweenTheEntrepreneur’svisionandThe

Manager’spragmatismthatcreatesthesynthesisfromwhichallgreat

worksareborn.

TheTechnician

TheTechnicianisthedoer.

“Ifyouwantitdoneright,doityourself”isTheTechnician’scredo.

TheTechnicianlovestotinker.Thingsaretobetakenapartandput

backtogetheragain.Thingsaren’tsupposedtobedreamedabout,they’re

supposedtobedone.

IfTheEntrepreneurlivesinthefutureandTheManagerlivesinthe

past,TheTechnicianlivesinthepresent.Helovesthefeelofthingsand

thefactthatthingscangetdone.

AslongasTheTechnicianisworking,heishappy,butonlyonone

thingatatime.Heknowsthattwothingscan’tgetdonesimultaneously;

onlyafoolwouldtry.Soheworkssteadilyandishappiestwhenheisin

controloftheworkflow.

Asaresult,TheTechnicianmistruststhoseheworksfor,becausethey

arealwaystryingtogetmoreworkdonethaniseitherpossibleor

necessary.

ToTheTechnician,thinkingisunproductiveunlessit’sthinkingabout

theworkthatneedstobedone.

Asaresult,heissuspiciousofloftyideasorabstractions.

Thinkingisn’twork;itgetsinthewayofwork.

TheTechnicianisn’tinterestedinideas;he’sinterestedin“howtodo

it.”

ToTheTechnician,allideasneedtobereducedtomethodologyif

theyaretobeofanyvalue.Andwithgoodreason.

TheTechnicianknowsthatifitweren’tforhim,theworldwouldbein

moretroublethanitalreadyis.Nothingwouldgetdone,butlotsof

peoplewouldbethinkingaboutit.

Putanotherway,whileTheEntrepreneurdreams,TheManagerfrets,

andTheTechnicianruminates.

TheTechnicianisaresoluteindividualist,standinghisground,

producingtoday’sbreadtoeatattonight’sdinner.Heisthebackboneof

everyculturaltradition,butmostimportantly,ofours.IfTheTechnician

didn’tdoit,itwouldn’tgetdone.

EveryonegetsinTheTechnician’sway.

TheEntrepreneurisalwaysthrowingamonkeywrenchintohisday

withthecreationofyetanother“greatnewidea.”

Ontheotherhand,TheEntrepreneurisalwayscreatingnewand

interestingworkforTheTechniciantodo,thusestablishingapotentially

symbioticrelationship.

Unfortunately,itrarelyworksoutthatway.

Sincemostentrepreneurialideasdon’tworkintherealworld,The

Technician’susualexperienceisoneoffrustrationandannoyanceat

beinginterruptedinthecourseofdoingwhatneedstobedonetotry

somethingnewthatprobablydoesn’tneedtobedoneatall.

TheManagerisalsoaproblemtoTheTechnicianbecauseheis

determinedtoimposeorderonTheTechnician’swork,toreducehimtoa

partof“thesystem.”

Butbeingaruggedindividualist,TheTechniciancan’tstandbeing

treatedthatway.

ToTheTechnician,“thesystem”isdehumanizing,cold,antiseptic,

andimpersonal.Itviolateshisindividuality.

Workiswhatapersondoes.Andtothedegreethatit’snot,work

becomessomethingforeign.

ToTheManager,however,workisasystemofresultsinwhichThe

Technicianisbutacomponentpart.

ToTheManager,then,TheTechnicianbecomesaproblemtobe

managed.ToTheTechnician,TheManagerbecomesameddlertobe

avoided.

Tobothofthem,TheEntrepreneuristheonewhogottheminto

troubleinthefirstplace!

ThefactofthematteristhatweallhaveanEntrepreneur,Manager,and

Technicianinsideus.Andiftheywereequallybalanced,we’dbe

describinganincrediblycompetentindividual.

TheEntrepreneurwouldbefreetoforgeaheadintonewareasof

interest;TheManagerwouldbesolidifyingthebaseofoperations;and

TheTechnicianwouldbedoingthetechnicalwork.

Eachwouldderivesatisfactionfromtheworkhedoesbest,serving

thewholeinthemostproductiveway.

Unfortunately,ourexperienceshowsusthatfewpeoplewhogointo

businessareblessedwithsuchabalance.Instead,thetypicalsmall

businessownerisonly10percentEntrepreneur,20percentManager,

and70percentTechnician.

TheEntrepreneurwakesupwithavision.

TheManagerscreams“Oh,no!”

Andwhilethetwoofthemarebattlingitout,TheTechnicianseizes

theopportunitytogointobusinessforhimself.

Nottopursuetheentrepreneurialdream,however,buttofinally

wrestcontrolofhisworkfromtheothertwo.

ToTheTechnicianit’sadreamcometrue.TheBossisdead.

Buttothebusinessit’sadisaster,becausethewrongpersonisatthe

helm.

TheTechnicianisincharge!

Sarahlookedalittleoverwhelmed.

“Idon’tunderstand,”shesaid.“HowcouldIhavedonethis

differently?TheonlyreasonIwentintothisbusinesswasbecauseIloved

bakingpies.Ifithadn’tbeenforthat,whatwouldhavebeenthepoint?”

Shewatchedmyfacesuspiciously,asthoughIweretryingtomakeher

alreadyimpossiblesituationevenmoreimpossible.

“Well,let’sthinkaboutittogether,”Ianswered.

“Ifit’struethatwithineachbusinesspersontherearethree

personalities,ratherthanjustone,canyouimaginewhatamessthat

makes?Ifoneofyouwantsthis,andanotherofyouwantsthat,anda

thirdwantssomethingentirelydifferent,canyouimaginetheconfusion

thatcausesinourlives?Andit’snotonlythepersonalitiesinsideeach

oneofusthatconfuseusbutalltheotherswecomeintocontactwithas

well:inourcustomers,inouremployees,inourchildren,inourpartners,

inourparents,inourfriends,inourspouses,inourlovers.Ifthisistrue,

andallyouneedtodotodiscoverwhetheritisornotistotakealookat

yourselffromdaytoday,asthoughfromabove,asthoughfromoutside

ofyourskin,asthoughyouwerewatchingsomeoneelse—thatis,to

observeyourselfasyougothroughtheday—youwouldseethedifferent

partscomeout.Youwouldseethemplayingtheirrespectivegames.You

wouldseehowtheyfightfortheirownspace—andthespaceofallthe

others—andsabotageeachotherasbesttheycan.

“Inyourbusiness,youwouldseehowonepartofyoucravesasense

oforder,whileanotherpartofyoudreamsaboutthefuture.Youwould

seehowanotherpartofyoucan’tstandbeingidle,andjumpsintobake,

andtocleanup,andtowaitoncustomers,thepartofyouwhofeelsguilty

ifsheisn’tdoingsomethingallthetime.

“Inshort,youwouldseehowTheEntrepreneurinyoudreamsand

schemes,TheManagerinyouisconstantlyattemptingtokeepthingsas

theyare,andTheTechnicianinyoudrivestheothertwocrazy.Youwould

seethatitnotonlymattersthatyourpersonalitiesarenotinabalanced

relationshipwitheachotherbutthatyourlifedependsongainingthat

balance.Thatuntilyoudo,it’sawar!Andit’sawarnoonecanwin.

“Youwouldalsoseethatoneofyourpersonalitiesisthestrongestof

thethree(orfour,orfive,orsix),andthatshealwaysmanagestocontrol

theothers.Infact,ifyouwatchlongenough,you’llbegintounderstand

howdevastatingthetyrannyofyourstrongestpersonalityistoyourlife.

Andyou’llseethatwithoutbalance,withoutallthreeofthese

personalitiesbeinggiventheopportunity,thefreedom,thenourishment

theyeachneedtogrow,yourbusinesscannothelpbutmirroryourown

lopsidedness.

“Soitisthatanentrepreneurialbusiness,withoutaManagertogiveit

orderandwithoutaTechniciantoputittowork,isdoomedtosufferan

early,andprobablyverydramatic,death.AndthataManager-driven

business,withoutanEntrepreneuroraTechniciantoplaytheir

absolutelycriticalroles,willputthingsintolittlegrayboxesoverandover

again,onlytorealizetoolatethatthere’snoreasonforthethingsorthe

boxessheputtheminto!Suchabusinesswilldieveryneatly.

“AndthatinaTechnician-drivenbusiness,withoutTheEntrepreneur

toleadherandTheManagertosuperviseher,TheTechnicianwillwork

untilshedrops,onlytowakeupthenextmorningtogotoworkeven

harder,andthenext,andthenext.Onlytodiscover,longafterit’stoo

late,thatwhileshewasworkingsomeonemovedafreewaythroughthe

store!”

Sarahlookedatmewithuncertainty.

“But,I’mnotanEntrepreneur,”shesaid.

“AllIdoisbakepies.AllIeverwantedtodowastobakepies,justlike

TheTechnicianyoudescribed.Whenentrepreneurialpersonalitieswere

passedout,IthinkIgotpassedover.WhatdoIdoifthereisno

Entrepreneurinme?”

Icouldn’thelpbutsmile.Thiswasgoingtobefun.BecauseIknew

whenSarahfinallygotit—andIknewshewould—shewasgoingto

discoversomeoneinherselfsheneverknewwasthere.

“Beforewereachthatconclusion,Sarah,let’slookmorecloselyat

whatanEntrepreneurdoes,”Iresponded.

“AnEntrepreneurdoestheworkofenvisioningthebusinessas

somethingapartfromyou,theowner.Theworkofaskingalltheright

questionsaboutwhythisbusiness,asopposedtothatbusiness?Whya

piebakingbusinessratherthanabodyshop?Ifyouareabakerofpies,

it’seasyforyoutodecidetoopenupapie-bakingbusiness.Butthat’sjust

thepoint.Ifyouareabakerofpiesandaredeterminedtodo

entrepreneurialwork,youwouldleaveyourpie-bakingexperiencebehind

youandengageintheinternaldialoguewithwhicheverytruly

entrepreneurialpersonalityiswonderfullyfamiliar.

“Youwouldbegintosaytoyourself,‘It’stimeformetocreateanew

life.It’stimeformetochallengemyimaginationandtobegintheprocess

ofshapinganentirelynewlife.Andthebestwaytodothatanywherein

thiswholewideopportunity-filledworldistocreateanexcitingnew

business.OnethatcangivemeeverythingthatIwant,onethatdoesn’t

requiremetobethereallthetime,onethathasthepotentialtobe

stunninglyunique,onethatpeoplewilltalkaboutlongafterhaving

shoppedinittheveryfirsttime,and,asaresultofthatdelightful

experience,willcomebacktoshopthereagainbecauseithassucha

specialflavortoit.Iwonderwhatthatbusinesswouldbe?’

“Iwonderwhatthatbusinesswouldbe?”IsaidtoSarah,“isthetruly

entrepreneurialquestion.Thedreamingquestion,Icallit.It’sthe

questionthatisattheheartoftheworkofanEntrepreneur.Iwonder.I

wonder.Iwonder.

“SotheworkofanEntrepreneuristowonder,”Icontinued.“To

imagineandtodream.Toseewithasmuchofherselfasshecanmuster

thepossibilitiesthatwaftaboutinmidairsomeplacethereaboveherhead

andwithinherheart.Notinthepastbutinthefuture.That’stheworkthe

entrepreneurialpersonalitydoesattheoutsetofherbusinessandateach

andeverystagealongtheway.Iwonder.Iwonder.Iwonder.Justas

everyinventormust.Justaseverycomposermust.Justaseveryartist,or

everycraftsperson,oreveryphysicistmust.Justaseverybakerofpies

must.IcallitFutureWork.‘Iwonder’isthetrueworkofthe

entrepreneurialpersonality.”

Shetriedtorepressit,butIsawasmallsmilebegintoformon

Sarah’smouth.

“HowcouldIdothisdifferently,”shefinallyaskedmewithgrowing

confidence.“IfIweretogivethetrueentrepreneurinmyselflife,how

couldItotallychangemyexperienceofthisbusiness?”

“Nowyou’vegotit!”Isaid.“That’sjusttherightquestion.Andtoget

totheanswer,let’slookatwhereyourbusinessexiststodayinthesmall

businesslifecycle.”

3INFANCY:THETECHNICIAN’SPHASE

…myUncleSolhadaskunkfarmbuttheskunkscaughtcoldand

diedandsomyUncleSolimitatedtheskunksinasubtle

manner…

e.e.cummings

CollectedPoems

Itisself-evidentthatbusinesses,likepeople,aresupposedtogrow;andwithgrowth,comeschange.

Unfortunately,mostbusinessesarenotrunaccordingtothis

principle.Insteadmostbusinessesareoperatedaccordingtowhatthe

ownerwantsasopposedtowhatthebusinessneeds.

AndwhatTheTechnicianwhorunsthecompanywantsisnotgrowth

orchangebutexactlytheopposite.Hewantsaplacetogotowork,freeto

dowhathewants,whenhewants,freefromtheconstraintsofworking

forTheBoss.

Unfortunately,whatTheTechnicianwantsdoomshisbusinessbefore

itevenbegins.

Tounderstandwhy,let’stakealookatthethreephasesofabusiness’s

growth:Infancy,Adolescence,andMaturity.

Understandingeachphase,andwhatgoesoninthebusinessowner’s

mindduringeachofthem,iscriticaltodiscoveringwhymostsmall

businessesdon’tthriveandensuringthatyoursdoes.

TheBossisdead,andyou,TheTechnician,arefreeatlast.Finally,you

candoyourownthinginyourownbusiness.Hoperunshigh.Theairis

electricwithpossibility.It’slikebeingletoutofschoolforthesummer.

Yournewfoundfreedomisintoxicating.

Inthebeginningnothingistoomuchforyourbusinesstoask.AsThe

Technician,you’reaccustomedto“payingyourdues.”Sothehours

devotedtothebusinessduringInfancyarenotspentgrudginglybut

optimistically.There’sworktobedone,andthat’swhatyou’reallabout.

Afterall,yourmiddlenameisWork.“Besides,”youthink,“thisworkis

forme.”

Andsoyouwork.Ten,twelve,fourteenhoursaday.Sevendaysa

week.Evenwhenyou’reathome,you’reatwork.Allyourthoughts,all

yourfeelings,revolvearoundyournewbusiness.Youcan’tgetitoutof

yourmind.You’reconsumedbyit;totallyinvestedindoingwhateveris

necessarytokeepitalive.

Butnowyou’redoingnotonlytheworkyouknowhowtodobutthe

workyoudon’tknowhowtodoaswell.You’renotonlymakingitbut

you’realsobuyingit,sellingit,andshippingit.DuringInfancy,you’rea

MasterJuggler,keepingalltheballsintheair.

It’seasytospotabusinessinInfancy—theownerandthebusiness

areoneandthesamething.

IfyouremovedtheownerfromanInfancybusiness,therewouldbe

nobusinessleft.Itwoulddisappear!

InInfancy,youarethebusiness.

It’sevennamedafteryou—“JOE’SPLACE,”“TOMMY’SJOINT,”

“MARY’SFINEFOODS”—sothecustomerwon’tforgetyou’reTheBoss.

Andsoon—ifyou’relucky—allofthesweat,worry,andworkbeginto

payoff.You’regood.Youworkhard.Thecustomersdon’tforget.They’re

comingback.They’resendinginfriends.Theirfriendshavefriends.And

they’realltalkingaboutJoe,Tommy,andMary.They’realltalkingabout

you.

Ifyoucanbelievewhatyourcustomersaresaying,there’sneverbeen

anyonelikeJoe,Tommy,andMary.Joe,Tommy,andMaryarejustlike

oldfriends.Theyworkhardfortheirmoney.Andtheydogoodwork.Joe

isthebestbarberIeverwentto.TommyisthebestprinterIeverused.

MarymakesthebestcornedbeefsandwichIeverate.Yourcustomersare

crazyaboutyou.Theykeepcoming,indroves.

Andyouloveit!

Butthenitchanges.Subtlyatfirst,butgraduallyitbecomesobvious.

You’refallingbehind.There’smoreworktodothanyoucanpossiblyget

done.Thecustomersarerelentless.Theywantyou;theyneedyou.You’ve

spoiledthemforanyoneelse.You’reworkingatbreakneckspeed.

Andthentheinevitablehappens.You,theMasterJuggler,beginto

dropsomeoftheballs!

Itcan’tbehelped.Nomatterhowhardyoutry,yousimplycan’tcatch

themall.Yourenthusiasmforworkingwiththecustomerswanes.

Deliveries,onceearly,arenowlate.Theproductbeginstoshowthewear

andtear.Nothingseemstoworkthewayitdidatfirst.

Joe’shaircutsdon’tlookthewaytheyusedto.“Isaidshortinthe

back,notonthesides.”“Myname’snotFred;that’smybrother—andI

neverhadacrewcut!”

GlitchesstartshowingupinTommy’sprinting:typos,inksmudges,

wrongcolors,wrongpaper.“Ididn’torderbusinesscards;Iordered

catalogcovers.”“Pink?Isaidbrown!”

Mary’sbest-tasting-biggest-stack-of-corned-beef-in-the-world

suddenlylookslikepastrami.Itispastrami.“Didn’tyouaskfor

pastrami?”Anotherirritatedvoicecallsout:“Where’smypastrami

sandwich?Thisiscornedbeef!”Andyetanother:“Whatarethese

garbanzobeansdoinginmymeatloaf?”

Whatdoyoudo?Youstretch.Youworkharder.Youputinmoretime,

moreenergy.

Ifyouputintwelvehoursbefore,younowputinfourteen.

Ifyouputinfourteenhoursbefore,younowputinsixteen.

Ifyouputinsixteenhoursbefore,younowputintwenty.Butthe

ballskeepdropping!

Allofasudden,Joe,Tommy,andMarywishtheirnamesweren’ton

thesign.

Allofasudden,theywanttohide.

Allofasudden,youfindyourselfattheendofanunbelievablyhectic

week,lateonaSaturdaynight,poringoverthebooks,tryingtomake

somesenseoutofthemess,thinkingaboutalloftheworkyoudidn’tget

donethisweek,andalloftheworkwaitingforyounextweek.Andyou

suddenlyrealizeitsimplyisn’tgoingtogetdone.There’ssimplynoway

intheworldyoucandoallthatworkyourself!

Inaflash,yourealizethatyourbusinesshasbecomeTheBossyou

thoughtyouleftbehind.There’snogettingridoftheBoss!

Infancyendswhentheownerrealizesthatthebusinesscannotcontinue

torunthewayithasbeen;that,inorderforittosurvive,itwillhaveto

change.

Whenthathappens—whentherealitysinksin—mostbusinessfailures

occur.

Whenthathappens,mostofTheTechnicianslocktheirdoorsbehind

themandwalkaway.

TherestgoontoAdolescence.

Sarahwasbeginningtolookdefeatedagain.Ihadseenthatlookbefore

onthefacesofcountlessclients.WhenaTechnician-turned-business-

ownerissuddenlyconfrontedwiththerealityofhersituation,asenseof

hopelessnesscansetin.Thechallengecanseemoverwhelming.But,I

sensedthatSarahwouldstrugglewiththeidea—andherself—untilshe

gotit.

“IguessIstilldon’tgetit,”shesaid.“What’swrongwithbeinga

Technician?IusedtolovetheworkIdo.AndifIdidn’thavetodoall

theseotherthings,Iwouldstillloveit!”

“Ofcourseyouwould,”Ianswered.“Andthat’sexactlythepoint!

“There’snothingwrongwithbeingaTechnician.There’sonly

somethingwrongwithbeingaTechnicianwhoalsoownsabusiness!

BecauseasaTechnician-turned-business-owner,yourfocusisupside

down.Youseetheworldfromthebottomupratherthanfromthetop

down.Youhaveatacticalviewratherthanastrategicview.Youseethe

workthathastogetdone,andbecauseofthewayyou’rebuilt,you

immediatelyjumpintodoit!Youbelievethatabusinessisnothingmore

thananaggregateofthevarioustypesofworkdoneinit,wheninfactitis

muchmorethanthat.

“Ifyouwanttoworkinabusiness,getajobinsomebodyelse’s

business!Butdon’tgotoworkinyourown.Becausewhileyou’re

working,whileyou’reansweringthetelephone,whileyou’rebakingpies,

whileyou’recleaningthewindowsandthefloors,whileyou’redoingit,

doingit,doingit,there’ssomethingmuchmoreimportantthatisn’t

gettingdone.Andit’stheworkyou’renotdoing,thestrategicwork,the

entrepreneurialwork,thatwillleadyourbusinessforward,thatwillgive

youthelifeyou’venotyetknown.

“No,”Isaid,trulyenjoyingthis,“there’snothingwrongwithtechnical

work;itis,itcanbe,purejoy.

“It’sonlyaproblemwhenTheTechnicianconsumesalltheother

personalities.WhenTheTechnicianfillsyourdaywithwork.WhenThe

Technicianavoidsthechallengeoflearninghowtogrowabusiness.

WhenTheTechnicianshrinksfromtheentrepreneurialrolesonecessary

tothelifeblood,themomentum,ofatrulyextraordinarysmallbusiness,

andfromthemanagerialrolesocriticaltotheoperationalbalanceor

groundingofasmallbusinessonaday-to-daybasis.

“TobeagreatTechnicianissimplyinsufficienttothetaskofbuilding

agreatsmallbusiness.Beingconsumedbythetacticalworkofthe

business,aseveryTechniciansufferingfromanEntrepreneurialSeizure

is,leadstoonlyonething:acomplicated,frustrating,and,eventually,

demeaningjob!

“Iknowyouknowwhatthatfeelslike,Sarah.Canyouseethataslong

asyouviewyourbusinessfromTheTechnician’sperspective,youare

doomedtocontinuehavingthisexperience?”IaskedherasgentlyasI

could.

IsawthatSarahwasstillstrugglingwiththeideaofdoingwhatshe

doesdifferently.IwaitedforthequestionIknewwasbrewing,andit

wasn’tlongbeforeitcame.

“ButIcan’tevenimaginewhatmybusinesswouldbelikewithoutme

doingthework,”shesaid.“Ithasalwaysdependedonme.Ifitweren’tfor

me,mycustomerswouldgosomeplaceelse.I’mnotsureIunderstand

what’sreallywrongwiththat.”

“Well,thinkaboutit,”Isaid.“Inabusinessthatdependsonyou,on

yourstyle,onyourpersonality,onyourpresence,onyourtalentand

willingnesstodothework,ifyou’renottherewhyofcourseyour

customerswouldgosomeplaceelse.Wouldn’tyou?

“Becauseinabusinesslikethatwhatyourcustomersarebuyingisnot

yourbusiness’sabilitytogivethemwhattheywantbutyourabilityto

givethemwhattheywant.Andthat’swhat’swrongwithit!

“Whatifyoudon’twanttobethere?Whatifyou’dliketobe

someplaceelse?Onavacation?Orathome?Readingabook?Workingin

thegarden?Oronasabbatical,forGod’ssake?Isn’tthereanyplaceyou

wouldratherbeattimesthaninyourbusiness,fillingtheneedsofyour

customerswhoneedyousobadlybecauseyou’retheonlyonewhocando

it?

“Whatifyou’resick,orfeellikebeingsick?Orwhatifyoujustfeel

lazy?

“Don’tyousee?Ifyourbusinessdependsonyou,youdon’towna

business—youhaveajob.Andit’stheworstjobintheworldbecause

you’reworkingforalunatic!

“And,besides,that’snotthepurposeofgoingintobusiness.

“Thepurposeofgoingintobusinessistogetfreeofajobsoyoucan

createjobsforotherpeople.

“Thepurposeofgoingintobusinessistoexpandbeyondyourexisting

horizons.Soyoucaninventsomethingthatsatisfiesaneedinthe

marketplacethathasneverbeensatisfiedbefore.Soyoucanlivean

expanded,stimulatingnewlife.”

Sarahsaid,“Ihatetobeatadeadhorse,butwhatifIwanttodothe

technicalworkinmybusiness?WhatifIdon’twanttodoanythingelse

butthat?”

“ThenforGod’ssake,”IsaidasemphaticallyasIdared,“getridof

yourbusiness!Andgetridofitasquicklyasyoucan.Becauseyoucan’t

haveitbothways.Youcan’t‘haveyourpieandeatittoo.’Youcan’t

ignorethefinancialaccountabilities,themarketingaccountabilities,the

salesandadministrativeaccountabilities.Youcan’tignoreyourfuture

employees’needforleadership,forpurpose,forresponsible

management,foreffectivecommunication,forsomethingmorethanjust

ajobinwhichtheirsolepurposeistosupportyoudoingyourjob.Let

alonewhatyourbusinessneedsfromyouifit’stothrive:thatyou

understandthewayabusinessworks,thatyouunderstandthedynamics

ofabusiness—cashflow,growth,customersensitivity,competitive

sensitivity,andsoforth.

“Thepointis,”Isaidtoher,watchingherfacesinkandthenbeginto

liftwithanunexpressedquestion,“ifallyouwantfromabusinessofyour

ownistheopportunitytodowhatyoudidbeforeyoustartedyour

business,getpaidmoreforit,andhavemorefreedomtocomeandgo,

yourgreed—Iknowthatsoundsharsh,butthat’swhatitis—yourself-

indulgencewilleventuallyconsumebothyouandyourbusiness.”

IpausedandthencontinuedbecauseIcouldseethatSarahwasnot

yettotallyconvinced.

“Youjustcan’tgettherefromhere!Youjustcan’tplaytheroleofThe

TechnicianandignoretherolesofTheEntrepreneurandTheManager

simplybecauseyou’reunpreparedtoplaythem.

“Because,themomentyouchosetostartasmallbusiness,Sarah,you

unwittinglychosetoplayasignificantlylargergamethananygameyou

hadeverplayedbefore.

“Andtoplaythisnewgame,calledbuildingasmallbusinessthat

actuallyworks,yourEntrepreneurneedstobecoaxedout,nourished,

andgiventheroomsheneedstoexpand,andyourManagerneedstobe

supportedaswellsoshecandevelopherskillatcreatingorderand

translatingtheentrepreneurialvisionintoactionsthatcanbeefficiently

manifestedintherealworld.

“Anythinglessthanthatwilleventuallypushyoutothebrinkof

disasterand,finally,overtheedge.Becauseasmallbusinesssimply

demandsthatwedoitorthebusinesswillshrivelonthevine.

“Sowhetherwelikeitornot,wehavetolearnhow.Theexcitingthing

is,thatonceyoubeginto,onceyourTechnicianbeginstoletgo,onceyou

makeroomfortherestofyoutoflourish,thegamebecomesmore

rewardingthanyoucanpossiblyimagineatthispointinyourbusiness’s

life.”

“Tellmemoreaboutthat,”Sarahsaid.“Ireallywanttoknow.”

“Iwill,”Ianswered.“AlthoughIsensethatyoualreadyunderstand

quiteabitmorethanyouthink.Butfirst,let’sgoontoAdolescence,the

secondstageinasmallbusiness’sgrowth.”

4ADOLESCENCE:GETTINGSOMEHELPAsgovernments,westumblefromcrisistocrashprogram,

lurchingintothefuturewithoutplan,withouthope,without

vision.

AlvinToffler

TheThirdWave

Adolescencebeginsatthepointinthelifeofyourbusinesswhenyou

decidetogetsomehelp.

There’snotellinghowsoonthiswillhappen.Butitalwayshappens,

precipitatedbyacrisisintheInfancystage.

EverybusinessthatlastsmustgrowintotheAdolescentphase.Every

smallbusinessownerwhosurvivesseekshelp.

Whatkindofhelpdoyou,theoverloadedTechnician,goouttoget?

Theanswerisaseasyasitisinevitable:technicalhelp.

Someonewithexperience.

Someonewithexperienceinyourkindofbusiness.

Someonewhoknowshowtodothetechnicalworkthatisn’tgetting

done—usuallytheworkyoudon’tliketodo.

Thesales-orientedownergoesouttofindaproductionperson.

Theproduction-orientedownerlooksforasalesperson.

Andjustabouteverybodytriestofindsomeonetodothebooks!

Becauseifthere’sanythingmostsmallbusinessownershatetodo—and

thereforeignore—it’sthebooks.

Andsoitisthatyoubringinyourfirstemployee—Harry,asixty-

eight-year-oldbookkeeperwho’sbeendoingthebookssincehewas

twelveyearsold,intheOldCountry.

Harryknowsthebooks.

Heknowshowtodothebooksineightdifferentlanguages.

Butmostimportant,Harryhastwenty-twoyearsofexperiencedoing

thebooksinacompanyjustlikeyours.

ThereisnothingHarrydoesn’tknowaboutyourkindofbusiness.

Andnowhe’syours.

Theworldsuddenlylooksbrighteragain.

Amajorballisabouttobecaught—andbysomebodyelsefora

change!

It’sMondaymorning.Harryarrives.Yougreethimwarmly,and,let’s

faceit,feverishly.You’vespentallweekendgettingreadyforthis

moment.Youclearedoutagenerousspaceforhim.Youarrangedthe

booksandthestackofunopenedlettersonhisdesk.Youboughtacoffee

cupwith“Harry”printedonit.Youwereeventhoughtfulenoughtofinda

cushionforhischair(he’llbesittingforalongtime).

There’sacriticalmomentineverybusinesswhentheownerhireshis

veryfirstemployeetodotheworkhedoesn’tknowhowtodohimself,or

doesn’twanttodo.Inyourbusiness,Harryisthatperson.Andthis

Mondaymorningisthatcriticaltime.

Thinkaboutit.

You’vetakenabigstep.ThebooksareonHarry’sdesknowrather

thanyours.

Andwhat’smore,Harryisabouttobecometheonlyotherpersonin

thewholeworldwhoknowstherealstoryaboutyouandyourbusiness.

Harryisgoingtotakeonelookatthebooksandknowthetruth.

Harry,yourveryfirstandmostimportantemployee,isabouttofind

outasecretyou’vebeenhidingfromeveryoneelseinyourlife:thatyou

don’tknowwhatyou’redoing!

Thequestionis,what’shegoingtodoaboutit?

Willhelaugh?

Willhecry?

Willheleave?

Orwillhegotowork?

AndifHarrywon’tdothebooks,whowill?

Butsuddenlyyouhearthequiet,systematicclatteringofthe

calculator’skeysfromHarry’sdesk.

He’sworking!

Harry’sgoingtostay!

Youcan’tbelieveyourluck.

You’renotgoingtohavetodothebooksanymore.

Andinasinglestroke,yousuddenlyunderstandwhatitmeanstobe

inbusinessinawayyouneverunderstoodbefore.

“Idon’thavetodothatanymore!”

Atlastyou’refree.TheManagerinyouwakesupandTheTechnician

temporarilygoestosleep.Yourworriesareover.Someoneelseisgoingto

dothatnow.

Butatthesametime—unaccustomedasyouaretobeingThe

Manager—yournewfoundfreedomtakesonanalltoocommonform.

It’scalledManagementbyAbdicationratherthanbyDelegation.

Inshort,likeeverysmallbusinessownerhasdonebeforeyou,you

handthebooksovertoHarry…andrun.

Andforawhileyouarefree.Atleastrelativelyso.Afterall,youstill

havealltheotherworktodo.

ButnowthatyouhaveHarry,thingsarebeginningtochange.

BecausewhenHarry’snottotallyimmersedinthebooks,youcanget

himtoanswerthephone.

Andwhenhe’snotansweringthephone,youcangethimtodoalittle

shippingandreceiving.

Andwhenhe’snotdoingtheshippingandreceiving,hemightaswell

handleafewofyourcustomers.

Andwhenhe’snothandlingafewofyourcustomers,well,whoknows

whatyoucouldthinkofnext?

Lifebecomeseasier.Lifebecomesadream.

Youbegintotakealittlelongerlunch:thirtyminutesinsteadof

fifteen.

Youleavealittleearlierattheendoftheday:eighto’clockinsteadof

nine.

Harrycomestoyouoccasionallytotellyouwhatheneeds,andyou,

busyasusual,simplytellhimtohandleit.Howdoesn’tmatteraslongas

hedoesn’tbotheryouwiththedetails.You’vegototherfishtofry.

Harryneedsmorepeople.Thebusinessisbeginningtogrow.Busyas

usual,youtellhimtohirethem.Hedoes.Harry’sawonder.It’sgreatto

haveaguylikeHarry.Youdon’thavetothinkaboutwhathe’sdoing;you

don’thavetoworryabouthowhe’sgettingalong.Henevercomplains.He

justworks.Andhe’sdoingalltheworkyouhatetodo.It’sthebestofall

possibleworlds.YougettobeTheBoss,doingtheworkyoulovetodo,

andHarrytakescareofeverythingelse.Ah,thelifeofanEntrepreneur!

Andthenitunexpectedlyhappens.

Acustomercallstocomplainabouttheshabbytreatmentshereceived

fromoneofyourpeople.“Whowasit?”youask,privatelysteaming.She

doesn’tknow,butifyou’regoingtohirepeoplelikethatshe’lltakeher

businesselsewhere.

Youpromisetolookintoit.

Yourbankercallstotellyouthatyou’reoverdrawn.“Howdidthat

happen?”youaskhim,yourheartdroppingtoyourknees.Hedoesn’t

know,butifyoudon’twatchitmorecloselyhe’llhaveto“takesteps.”

Youpromisetolookintoit.

Youroldestsuppliercallstotellyouthattheorderyouplacedthe

weekbeforewasplacedwrong,sotheshipmentwillbetenweekslate.

What’smore,you’regoingtohavetoeattheoverage.“Howdidthat

happen?”youaskhim,reachingforaRolaid.Hedoesn’tknow,butifyou

can’tmanageyourorderingbetterthanthat,he’llhavetolookatother

options.

Youpromisetolookintoit.

Outontheshippingdock,youwalkuptoakidHarryhired.He’s

wrappingapackage.Youlookatthepackageandexplode.“Whotaught

youtowrapapackagelikethis?”youaskthesurprisedkid.“Didn’t

anyoneshowyouhowtodothisright?Here,giveittome.I’lldoit

myself.”

Andyoudo.

Thatveryafternoon,youhappentobewalkingbytheproductionline.

Youalmostdropinyourtracks.“Whotaughtyoutodoitthatway?”you

stammertotheshockedproductionperson.“Didn’tanybodyshowyou

howtodoitright?Here,giveittome.I’lldoitmyself.”

Andyoudo.

Theverynextmorning,you’retalkingtothenewsalesperson,also

hiredbyHarry.

“What’shappeningtocustomerA?”youaskher.Heranswersends

youintoarage.“WhenItookcareofhimweneverhadproblemslike

that!”youwail.“Here,giveittome.I’lltakecareofitmyself.”

Andyoudo.

Andtheyoungshippingclerklooksattheproductionperson,and

theybothlookatthenewsalesperson,andtheyalllookattheirActing

BossHarry,andask:“Whothehellwasthat?!”Harryjustshrugsandsays

(asonlyamanwho’sworkedforotherpeopleforfifty-plusyearscansay):

“Oh,thatwasjustTheBoss.”

But,hearthis:whatHarryknowsissomethingyou’reabouttolearn.

Thatit’sonlythebeginningofaprocessthatoccursinevery

Adolescentbusinessoncetheowner’sManagementbyAbdicationbegins

totakeitstoll.It’sonlythebeginningofaprocessofdeteriorationin

whichthenumberofballsintheairnotonlyexceedsyourabilitytojuggle

themeffectivelybutyourpeople’sabilityaswell.

WhatHarryknows,andwhatyou’reabouttolearn,isthatit’sonly

thebeginningofaprocessinwhichtheballsbegintofallfasterandwith

greaterfrequencythantheyeverdidwhenyouweredoingeverything

yourself.

Andasthethudofthelandingballsbecomesdeafening,youbeginto

realizethatyounevershouldhavetrustedHarry.

Younevershouldhavetrustedanyone.

Youshouldhaveknownbetter.

Astheballscontinuetofallatanoverwhelmingrate,youbeginto

realizethatnoonecaresaboutyourbusinessthewayyoudo.

Thatnooneiswillingtoworkashardasyouwork.

Thatnoonehasyourjudgment,oryourability,oryourdesire,oryour

interest.

Thatifit’sgoingtogetdoneright,you’retheonewho’sgoingtohave

todoit.

SoyourunbackintoyourbusinesstobecometheMasterJuggler

again.It’sthesameoldstory.WalkintoanyAdolescentbusiness

anywhereintheworldandyou’llfindtheownerofthebusinessdoingit,

doingit,doingit,busy,busy,busy—doingeverythingthathastogetdone

inhisbusiness—despitethefactthathenowhaspeoplewhoare

supposedtobedoingitforhim.Peoplehe’spayingtodoit!

Andwhat’sworseisthatthemorehedoes,thelesstheydo.

Andthelesstheydo,themoreheknowsthatifit’sgoingtogetdone,

he’sgoingtohavetodoithimself.Soheinterfereswithwhattheyhaveto

doevenmore.

ButHarryknewthiswhenhestarted.

Hecouldhavetoldyou—hisnewBoss—thatultimatelyTheBoss

alwaysinterferes.

HarrycouldhavetoldyouthattheworkwillneverbedonetoThe

Boss’ssatisfaction.

AndthereasonisthatTheBossalwayschangeshismindaboutwhat

needstobedone,andhow.

WhatHarrydoesn’tknow,however,iswhy—whyyou’resucha

madman.

Thatit’snotyourpeoplewhoaredrivingyoucrazy.

Thatit’snotthecomplainingcustomerwho’sdrivingyoumad.

Thatit’snotthebanker,orthevendor,ortheincorrectlywrapped

packagethat’sdrivingyouupthewall.

Thatit’snotthat“nobodycares,”orthat“nothinggetsdoneontime”

that’sdrivingyouinsane.

No,it’snottheworldthat’stheproblem.

It’sthatyousimplydon’tknowhowtodoitanyotherway.

You’rehopelessly,helplesslyataloss.Foryoutobehavedifferently

youwouldneedtoawakenthepersonalitieswhohavebeenasleepwithin

youforalongtime—TheEntrepreneurandTheManager—andthenhelp

themtodeveloptheskillsonlytheycanaddtoyourbusiness.

ButTheTechnicianinyouwon’tstoplongenoughforthattohappen.

TheTechnicianinyouhasgottogotowork!

TheTechnicianinyouhasgottocatchtheballs!

TheTechnicianinyouhasgottokeepbusy.TheTechnicianinyou

hasjustreachedthelimitsofhisComfortZone.

IlookedoveratSarahandcouldtellIhadhitanerve.

Sarahhaddiscoveredsomethinginthecourseofourconversation—

somethingaboutherComfortZonethatwasverymeaningfulforher.

And,intuitively,Iknewwehadjusttakenasnapshotofit.

5BEYONDTHECOMFORTZONE

Drasticchangecreatesanestrangementfromtheself,and

generatesaneedforanewbirthofanewidentity.Anditperhaps

dependsonthewaythisneedissatisfiedwhethertheprocessof

changerunssmoothlyorisattendedwithconvulsionsand

explosions.

EricHoffer

TheTemperofOurTime

EveryAdolescentbusinessreachesapointwhereitpushesbeyondits

owner’sComfortZone—theboundarywithinwhichhefeelssecureinhis

abilitytocontrolhisenvironment,andoutsideofwhichhebeginstolose

thatcontrol.

TheTechnician’sboundaryisdeterminedbyhowmuchhecando

himself.

TheManager’sisdefinedbyhowmanytechnicianshecansupervise

effectivelyorhowmanysubordinatemanagershecanorganizeintoa

productiveeffort.

TheEntrepreneur’sboundaryisafunctionofhowmanymanagershe

canengageinpursuitofhisvision.

Asabusinessgrows,itinvariablyexceedsitsowner’sabilitytocontrol

it—totouch,feel,andseetheworkthatneedstobedone,andtoinspect

itsprogresspersonallyaseverytechnicianneedstodo.

Outofdesperation,hedoeswhatheknowshowtodoratherthan

whathedoesn’t,therebyabdicatinghisroleasmanagerandpassinghis

accountabilitydowntosomeoneelse—a“Harry.”

Atthatpoint,hisdesperationturnsintohope.HehopesthatHarry

willhandleitsothathewon’thavetoworryaboutitanymore.

ButHarryhasneedsofhisown.Harry’salsoatechnician.Heneeds

moredirectionthanTheTechniciancangivehim.Heneedstoknowwhy

he’sdoingwhathe’sdoing.Heneedstoknowtheresulthe’saccountable

forandthestandardsagainstwhichhisworkisbeingevaluated.Healso

needstoknowwherethebusinessisgoingandwherehisaccountabilities

fitintoitsoverallstrategy.

Toproduceeffectively,HarryneedssomethingTheTechnician-

turned-business-ownerisn’tcapableofgivinghim—amanager!Andthe

lackofonecausesthebusinesstogointoatailspin.

Andasthebusinessgrowsbeyondtheowner’sComfortZone—asthe

tailspinaccelerates—thereareonlythreecoursesofactiontobetaken,

onlythreewaysthebusinesscanturn.ItcanreturntoInfancy.Itcango

forbroke.Oritcanhangonfordearlife.

Let’stakealookateach.

GettingSmallAgain

OneofthemostconsistentandpredictablereactionsofThe

Technician-turned-business-ownertoAdolescentchaosisthedecisionto

“getsmall”again.Ifyoucan’tcontrolthechaos,getridofit.

Gobacktothewayitusedtobewhenyoudideverythingyourself,

whenyoudidn’thavepeopletoworryabout,ortoomanycustomers,or

toomanyunpayablepayablesandunreceivablereceivables,ortoomuch

inventory.

Inshort,gobacktothetimewhenbusinesswassimple,backto

Infancy.

Andthousandsuponthousandsoftechniciansdojustthat.Theyget

ridoftheirpeople,getridoftheirinventory,wrapuptheirpayablesina

largebag,rentasmallerfacility,putthemachineinthemiddle,putthe

telephonebythemachine,andgobacktodoingitallbythemselves

again.

Theygobacktobeingtheowner,soleproprietor,chiefcookand

bottlewasher—doingeverythingthatneedstobedone,allalone,but

comfortablewiththefeelingofregainedcontrol.

“Whatcangowrong?”theythinktothemselves,forgettingatonce

thatthey’vebeentherebefore.Predictably,thistootakesitstoll.

Onemorning—itcouldbesixweeksorsixyearsfollowingthedayyou

“gotsmall”again—theinevitablehappens.

Youwakeupinbed,andyourspouseturnstoyouandsays:“What’s

wrong?You’renotlookingtoogood.”

“I’mnotfeelingtoogood,”youanswer.

“Doyouwanttotalkaboutit?”heorsheasks.

“It’ssimple,”yousay,“Idon’twanttogointhereanymore!”

Thenyourspouseasksyoutheobviousquestion:“Butifyoudon’t,

whowill?”

Andallofasuddenyouarestruckwiththerealityofyourcondition.

Yourealizesomethingyou’veavoidedalltheseyears.

Youcomefacetofacewiththeunavoidabletruth:

Youdon’townabusiness—youownajob!

What’smore,it’stheworstjobintheworld!

Youcan’tcloseitwhenyouwantto,becauseifit’sclosedyoudon’tget

paid.

Youcan’tleaveitwhenyouwantto,becausewhenyouleavethere’s

nobodytheretodothework.

Youcan’tsellitwhenyouwantto,becausewhowantstobuyajob?

Atthatpointyoufeelthedespairandthecynicismalmosteverysmall

businessownergetstofeel.

Iftherewaseveradream,howeversmall,it’sgone.Andwithit,any

desiretokeepbusy,busy,busy.

Youdon’twashthewindowsanymore.

Youdon’tsweepthefloors.

Thecustomersbecomeaproblemratherthananopportunity.

Becauseifsomebodybuyssomething,you’regoingtohavetodothe

work.

Yourstandardsofdressbegintodeteriorate.

Thesignonthefrontdoorfadesandpeels.

Andyoudon’tcare.

Forwhenthedreamisgone,theonlythingleftiswork.

Thetyrannyofroutine.

Theday-to-daygrindofpurposelessactivity.

Finally,youclosethedoors.There’snothingtokeepyouthere

anymore.

AccordingtotheSmallBusinessAdministration,morethan400,000

suchbusinessesclosetheirdoorsintheUnitedStateseveryyear.

Andit’sunderstandable.

Yourbusiness,oncetheshiningpromiseofyourlife,andnowno

promiseatall,hasgraduallybecomeamortuaryfordeaddreams.

GoingforBroke

TheAdolescentbusinesshasanotheralternativethatiscertainlyless

painfulanddecidedlymoredramaticthan“gettingsmall.”Itcanjust

keepgrowingfasterandfasteruntilitself-destructsofitsown

momentum.

Therollcallisendless:Itel,OsbourneComputer,Coleco,and

countlessmore.Allsuch“going-for-broke”companieswerestartedwith

anEntrepreneurialSeizurebyaTechnicianwhofocusedonthewrong

endofthebusiness,thecommoditythebusinessmade,ratherthanthe

businessitself.

“Going-for-broke”businessesareasignofourtime.

Theyareahigh-techphenomenon.

Withtheexplosionofnewtechnologyandthenumbersofthosewho

createit,awholenewbreedoftechnicianshasflockedtothebusiness

arena.

Alongwiththesewizardsandtheirseeminglyunlimitedtechnical

virtuosity,anavalancheofnewproductshasthunderedthroughthe

wide-opendoorsofanenthralledandreceptivemarketplace.

Unfortunately,mostofthesecompaniesbarelygetthroughthedoors

beforetheuncontrollablemomentumthatgotthemthereforcesthemto

stumbleandthenfall.

AlltheexcessesofAdolescence,frustratingandbewilderingasthey

mightbeinanormallyexpandingcompany,aredisastrousina“going-

for-broke”business.Asquicklyasitgrows,chaosgrowsevenfaster.For

tiedtothetailofatechnologicalbreakthrough,TheTechnicianandhis

peoplerarelybreakfreelongenoughtogainsomeperspectiveabouttheir

condition.Thedemandforthecommodityofwhichtheyaresoproud

quicklyexceedstheirchronicallyAdolescentabilitytoproduceit.

Theresultisalmostalwayscatastrophic.Thebusinessexplodes,

leavingbehinditpeoplewhomostoftenjustifytheexplosionasan

inevitableconsequenceofdoingbusinessona“fasttrack”whereluckand

speedandabrilliantbitoftechnologicaldaring-doarethenecessary

componentsformakingitbig.

Therealityisotherwise.

Luckandspeedandbrillianttechnologyhaveneverbeenenough,

becausesomebodyisalwaysluckier,faster,andtechnologicallybrighter.

Unfortunately,onceonafasttrack,there’spreciouslittletimetolisten.

Theraceiswonbyreflex,astrokeofgenius,orastrokeofluck.

“Goingforbroke”isthehigh-techequivalentofRussianRoulette,

oftentimesplayedbypeoplewhodon’tevenknowthegunisloaded!

AdolescentSurvival

ThemosttragicpossibilityofallforanAdolescentbusinessisthatit

actuallysurvives!

You’reanincrediblystrong-willed,stubborn,single-minded

individualwho’sdeterminednottobebeaten.

Yougointoyourbusinesseverymorningwithavengeance,absolutely

convincedthatit’sajungleoutthere,andfullycommittedtodoing

whatever’snecessarytosurvive.

Andyoudosurvive.Kickingandscratching,beatingupyourpeople

andyourcustomers,rantingandravingatyourfamilyandfriends—

because,afterall,you’vegottokeepthebusinessgoing.Andyouknow

there’sonlyonewaytodoit:you’vegottobethere—allthetime.

InAdolescentSurvivalyou’reconsumedbythebusinessandthe

possibilityoflosingit.

Andsoyouputeverythingyouhaveintoit.

And,forwhateverreason,youmanagetokeepitgoing.

Dayafterday,fightingthesamebattles,inexactlythesamewayyou

didthedaybefore.

Youneverchange.

Nightafternight,yougohometounwind,onlytowindupeven

tighterinanticipationoftomorrow.

Finally,yourbusinessdoesn’texplode—youdo!

You’relikeatwelve-cylinderengineworkingononecylinder,

pumpingaway,tryingwitheverythingyou’vegottoproducetwelve

cylindersworthofresults.

Butfinally,andinevitably,there’snothingleft.

There’ssimplynothingmoreyoucando,exceptfacethefactthatone

cylindercan’tproducetheresultsoftwelve,nomatterhowhardittries.

Somethinghastogive,andthatsomethingisyou.

Doesthissoundfamiliar?

Well,ifyou’vebeeninbusinessforawhile,itshould.

Andifyouhaven’tbeeninbusinessforlong,itprobablywillsound

familiaroneday.

BecausethetragedyisthattheconditionofInfancyandAdolescence

dominatesAmericansmallbusiness.

ItistheconditioninmostofthesmallbusinessesweatE-Myth

Worldwidehavevisitedoverthepasttwenty-fouryears,aconditionof

rampantconfusionandwastedspirits.

Itdidn’tneedtohappen.Thereisabetterway.

ThenerveIhadtouchedearlierinSarahhaddiminishedenoughforher

tocollectherthoughts.

“Howdidyouknow?”sheaskedmequietly.“Haveyoubeentalkingto

someoneaboutme?”shesaid,inpartwantingtobelieveIknewmore

aboutherstorythanIhadleton,andinpartknowingshewasjustlike

everyoneelse.

Sheknewtheanswer.BeforeIcouldconfirmit,shesaid,“Igotsmall

again.AndIstilldon’tunderstandwhathappened.”

Shelookedaroundthesmallshopasthoughseeingsomeoneor

somethingIcouldn’t.

“MyHarrywasElizabeth,”shesighed.

“Ihiredherwhenthebusinesswasonlysixmonthsold.Shedid

everythingforme,Elizabethdid.Shewasabsolutelyincredible.Idon’t

knowwhatIwouldhavedonewithouther.Shedidthebooks.Shehelped

mebake.Shecleanedupinthemorningandafterweclosed.Shehired

myfirstthreeemployees,taughtthemhowtodothevariousjobsthat

neededtobedone.ShewasalwaysherewhenIneededher.And,asthe

businessgrewoverthenexttwoyears,Elizabethtookonmoreandmore

oftheresponsibilityforthebusiness.SheworkedashardasIdid.And

sheseemedtoloveithere.Andme.Sheseemedtolovemetoo.Goodness

knows,Ilovedher.

“Andthen,oneday—itwasaWednesday,June10th,Ibelieve,at

seveninthemorning—shecalledmeandtoldmeshewouldn’tbecoming

inanylonger.Thatshehadtakenanotherjob.Thatshecouldn’taffordto

workforwhatIwaspayingher.Justlikethat!Icouldn’tbelievemyears.

Icouldn’tbelievethatshemeantit.Ithoughtitwasajoke.Ilaughed,and

said,‘C’monElizabeth,’orsomethinglikethat.AndElizabethsaidshe

wassorry.Andthenhungup!Hungup.Justhungup.

“Well,Istoodthereandwept.AndthenIfeltfear,afearIhadn’tever

feltbefore.Ifeltcoldinside.Howcouldthisbe?Ithoughttomyself.How

couldsomeoneIthoughtIknewsowell,someoneItrustedsomuch,have

suddenlybecomeastranger?Whatintheworlddidthissayaboutme?

Aboutmylackofjudgment?AbouttheconversationsIshouldhavehad

withElizabethbutdidn’t?

“Butthepiesneededtoberemovedfromtheoven,andthefloors

neededtobecleaned,andtheshoppreparedforopening,andso,despite

thepainIwasfeeling,thesicknessinmystomach,Iwenttowork.AndI

haven’tstoppedsince.Thepeopleshehiredleftsoonafterward.Tobe

honestwithyou,Ineverreallyhadaconnectionwiththem.Theywere

Elizabeth’speople.

“WhenIthinkbacknow,Iseehoweasyitwasformetodo.Howeasy

itwasformetobecomeabsorbedbytheworkratherthanthepeople.

AndIguesstheyknewthat.BecauseafterElizabethlefttheyallseemed

toregardmewithsuspicion.LikeIhadlethergowithouttellingthemor

something.IfElizabethcouldleave,awomanlikethat,whatdiditsay

aboutthemforstaying?Atleastthat’swhatIbelievedtheywerethinking.

Whoknew?Iwastoodevastatedtoask.SincethenIhaven’thadthe

hearttohireanyonetoreplacethem.Thethoughtofitisterrifyingtome.

Thethoughtofbringingstrangersintomylifelikethatagainfeelslikea

riskIdon’twanttotake.AndsoIdoitallmyself.AndIknowIcan’tdoit

muchlonger.Besideswhich,what’sthepoint?”

Sarahsigheddeeplyandlookedacrossatme.

“So,there’smyComfortZone,”shesaid.“WhatdoIdoaboutthat?”

“Startalloveragain—butdifferentlythistime,”Ianswered.

“It’stheonlywayoutofthetrap.”

Mostofushavehadtheexperienceofbeingdisappointedbysomeonein

whomwehaveputourtrustasadirectresultofourindifferenceorlack

ofunderstandingorlackofskillorlackofattention.

Andmostofuslearneventually,iffornootherreasonthanbecause

werealizethatwecan’tbeeverywhereatonce,totrustagain.

Buttrustcanonlytakeussofar.

Trustalonecansetusuptorepeatthosesamedisappointing

experiences.

Becausetruetrustcomesfromknowing,notfromblindfaith.

Andtoknow,onemustunderstand.

Andtounderstand,onemusthaveanintimateawarenessofwhat

conditionsaretrulypresent.Whatpeopleknowandwhattheydon’t.

Whatpeopledoandwhattheydon’t.Whatpeoplewantandwhatthey

don’t.Howpeopledowhattheydoandhowpeopledon’t.Whopeopleare

andwhotheyaren’t.

Inshort,SarahtrustedElizabethblindly.Sarahsimplywantedto

believeinElizabeth.Itwaseasierthatway.BecauseifSarahtrusted

blindly,ifshesimplyleftitalluptochance,shewouldn’tbeforcedtodo

theworkshedidn’twanttodo.Theworkofcomingtoagreementabout

whatherrelationshipwithElizabethwasabout.Whatroleeachofthem

wastheretoplay.WhatitmeantforSarahtobeanownerandElizabeth

tobeheremployee.WhatitmeantforSarahtosetouttherulesofthe

gamethatshewasexpectingElizabethtoplay.

BecauseSarahdidn’tfeelcomfortableinthisnewrole,thisroleofthe

owner,thisroleofTheEntrepreneur,thisroleofabusinessperson,she

lefteverythinguptochance.Sheabdicatedheraccountabilityasan

ownerandtookontheroleofjustanotheremployee.Sheavoidedfully

participatinginherrelationshipwithElizabeth,and,intheprocess,

createdadynamicbetweenherselfandheremployeebuiltonaweak

structure.AnomissionthatforetoldElizabeth’sinevitabledepartureand

Sarah’sinevitablepain.

Icertainlydidn’tneedtotellSarahthatshehadnoonetoblamebut

herself.Ijustneededtofindtherightwaytoshowherhowshecoulddoit

differentlythenexttime.

“Thenexttime,”Isaid,“you’llknowthatyourbusinessisdestinedto

grow,andthatonceitdoesyourjobisgoingtobesignificantlydifferent.

Fornow,that’sallyouneed.

“Small,smaller,smallest.Howbigissmall?Oneperson?Tenpeople?

Sixtypeople?Onehundredfiftypeople?ToaFortune500company,a

Fortune1,000companyissmall.ToaFortune1,000company,aFortune

3,000companyissmall.Toaten-personcompany,atwo-person

companyissmall.

“Thetruequestionisnothowsmallabusinessshouldbebuthowbig.

Howbigcanyourbusinessnaturallybecome,withtheoperativeword

beingnaturally?

“Because,whateverthatsizeis,anylimitationyouplaceonitsgrowth

isunnatural,shapednotbythemarketorbyyourlackofcapital(even

thoughthatmayplayapart)butbyyourownpersonallimitations.Your

lackofskill,knowledge,andexperience,and,mostofall,passion,for

growingahealthy,functionallydynamic,extraordinarybusiness.

“Inthisregard,‘gettingsmall’is,ratherthananintentionalact,a

reactiontothepainandfearinducedbyuncontrolledanduncontrollable

growth,bothofwhichcouldhavebeenanticipatedprovidedtheowner

hadbeenpreparedtofacilitatethegrowthinabalanced,healthy,

proactiveway.

“Buttodothatrequiresintentionattheoutsetofthebusiness,

entrepreneurialintention,aswellasawillingness—no,atruepassion—

forthepersonaltransformationsuchaprocesswillcallfor:accessingnew

skills,newunderstanding,newknowledge,newemotionaldepth,new

wisdom.

“YoumightsaythatthechaosthattakesplaceineveryAdolescent

businesscanproduceoneoftwooutcomesforthesmallbusinessowner

whosuddenlyfindshimselfinthemiddleofit.Forthetrulypassionate

owner,DonJuan’s‘warrior,’itcanprovidehimwithanopportunityto

transmutehispersonal‘lead’into‘gold.’Orthefirescanbecomeso

fearsomethatheshrinksbacktothe‘safety’ofthesmallerlifehecame

fromnottoolongbefore—the‘lead’I’vegotisbetterthanthe‘gold’I

haven’tgot.Bettersafethansorry.

“So,inthiscontext,abusinessthat‘getssmallagain’isabusiness

reducedtothelevelofitsowner’spersonalresistancetochange,toits

owner’sComfortZone,inwhichtheownerwaitsandworks,worksand

waits,hopingforsomethingpositivetohappen.

“ThisconditionremindsmeofalinefromSamuelBeckett’sWaiting

forGodotinwhichEstragon,havingwaitedaroundfordayshopingthe

mythicalGodotwillarriveandrelievehimofhismisery,turnstohis

companion,Vladimir,andsays,‘Ican’tgoonlikethis.’TowhichVladimir

replies,‘That’swhatyouthink.’

“So,ifthenaturaldispositionofeverybusinessistoeithergrowor

contract—anditis;thereisnodenyingthat—then‘gettingsmallagain’is

thenaturalinclinationofTheTechnician-turned-ownertoshrinkfrom

theunknown,toshrinkfromthebusinessshehascreated,toconstrain

thebusinessfromcreatingdemandsonhertowhichshefeelshopelessly

inadequatetorespondappropriately.

“Inshort,businessesthat‘getsmallagain’die.Theyliterallyimplode

uponthemselves.

“Notrightaway,necessarily.Butovertimetheydie.Atrophyanddie.

Theycan’tdoanythingelse.

“Andtheresultofthatisenormousdisappointment,lostinvestment,

shatteredlives,notonlytheowner’sbutthoseoftheemployees,the

familiesofboththeownerandtheemployees,thecustomers,the

suppliers,thelenders,allofthosepeoplewhoseliveshavesomehowbeen

intertwinedwiththelifeofthissmallbusiness,andnowwithitsdeath.

“Thetragedyisthatallthiscouldhavebeenpreventedhadthe

businessbeenstarteddifferently,hadTheTechniciansufferingfroman

EntrepreneurialSeizureapproachedthebusinessinabroader,more

entrepreneurialway.

“Ofcourse,youcouldn’thaveanticipatedeverythingthathas

happenedtoyousofarinyourbusiness,”IsaidtoSarah,“butyoucould

haveanticipatedmuchofit.

“YoucouldhaveanticipatedwhathappenedtoElizabethandthe

peopleshehired.

“Youcouldhaveanticipatedthatpeoplewouldloveyourpiesandthat

thebusinesswouldthereforehavetogrow.

“Youcouldhaveanticipatedthatgrowthwouldbringadditional

responsibilities,additionalskillsrequired,additionalcapitalneededto

respondtotheaddeddemandthatgrowthalwaysplacesonabusiness

andonpeople.

“Inshort,whileyoucouldn’thaveknowneverything,youcould

certainlyhaveknownmorethanyoudo.

“Andthat’syourjob,Sarah!Thejoboftheowner.Andifyoudon’tdo

it,nobodywill.

“Simplyput,yourjobistoprepareyourselfandyourbusinessfor

growth.

“Toeducateyourselfsufficientlysothat,asyourbusinessgrows,the

business’sfoundationandstructurecancarrytheadditionalweight.

“Andasawesomearesponsibilityasthatmayseemtoyou,youhave

nootherchoice—ifyourbusinessistothrive,thatis.

“It’suptoyoutodictateyourbusiness’srateofgrowthasbestyoucan

byunderstandingthekeyprocessesthatneedtobeperformed,thekey

objectivesthatneedtobeachieved,thekeypositionyouareaimingyour

businesstoholdinthemarketplace.

“Byaskingtherightquestions,suchas:WheredoIwishtobe?When

doIwishtobethere?Howmuchcapitalwillthattake?Howmany

people,doingwhatwork,andhow?Whattechnologywillberequired?

Howlargeaspacewillbeneeded,atBenchmarkOne,atBenchmarkTwo,

atBenchmarkThree?

“Willyoubewrongattimes?Willyoumakemistakes?Willyou

changeyourmind?Ofcourseyouwill!Moreoftenthannot.But,done

right,youwillalsohavecontingencyplansinplace.Bestcase,worstcase.

Andsometimesyouwillsimplyflybytheseatofyourpants;youwillgo

withtheflow,followyourintuition.

“Butallthewhile,evenwhileyou’reguessing,thekeyistoplan,

envision,andarticulatewhatyouseeinthefuturebothforyourselfand

foryouremployees.Becauseifyoudon’tarticulateit—Imean,writeit

down,clearly,sootherscanunderstandit—youdon’townit!Anddoyou

knowthatinalltheyearsI’vebeendoingthisworkwithsmallbusiness

owners,outofthethousandsuponthousandswe’vemet,therehaveonly

beenafewwhohadanyplanatall!Nothingwritten,nothingcommitted

topaper,nothingconcreteatall.

“Remember,Sarah,anyplanisbetterthannoplan.

“Becauseintheprocessofdefiningthefuture,theplanbeginsto

shapeitselftoreality,boththerealityoftheworldoutthereandthe

realityyouareabletocreateinhere.

“Andasthosetworealitiesmerge,theyformanewreality—callityour

reality,callittheuniqueinventionthatisuniquelyyours,therealityof

yourmindandyourheartunitingwithalltheelementsofyourbusiness,

andyourbusinesswiththeworld,shaping,designing,collaborating,to

formsomethingthatneverexistedbeforeinexactlythatway.

“AndthatisthesignofaMaturecompany.AMaturecompanyis

starteddifferentlythanalltherest.AMaturecompanyisfoundedona

broaderperspective,anentrepreneurialperspective,amoreintelligent

pointofview.Aboutbuildingabusinessthatworksnotbecauseofyou

butwithoutyou.

“Andbecauseitstartsthatway,itismorelikelytocontinuethatway.

AndthereinresidesthetruedifferencebetweenanAdolescentcompany,

whereeverythingisleftuptochance,andaMaturecompany,where

thereisavisionagainstwhichthepresentisshaped.

“ButI’mgettingaheadofmyself,”Isaid.“Theimportantthingisthat

yourexperiencecouldhavebeencompletelydifferent.Thatthereisan

entirelydifferentwaytostartabusinessthanthewayyouandmost

Technicians-turned-business-ownersstarttheirs.Andthatanyonecando

it!”

IlookedatSarahandcaughttheglowinhereyes.

“I’minspiredbytheideaofit,”shesaidsoftly.“Allofasudden

everythingthathaslookedsodarkfeelslightagain.”

But,nosoonerhadshebeguntoletherselfthrilltotheideaof

buildingabusinessthatworksthatsomeotherthought—adarkthought—

capturedherattention.

“ButwhatdoIdoaboutElizabeth?”shesaid.

“WhatdoIdoaboutElizabeth?”ThequestioneveryTechnician-turned-

ownerwantsanswered.

Asthough,byansweringthatquestion,everythingelsewillbe

answered.

Asiftheanswertoallofthefrustrationsmostsmallbusinessowners

experienceissomehowtiedtoparticularpeople.

AsifwithinthecomplexityofSarah’srelationshipwithElizabeth—

withinallrelationshipsforthatmatter—thereexistssomekeywhich,

onceturned,couldmakeeverythingrightagain.

Well,I’mnogenius,butIknowthatthereisnosuchkey.

There’sjustus,youandme,fumblingaboutinourofteninadequate

way,constantlybeingsurprisedbyourownandotherpeople’sbehavior,

howbadlywe’vedoneit,howoutoftouchwithourownandothers’

feelingswe’vediscoveredourselvestobe.

IlookedSarahintheeye,gotveryquiet,andsaid,“Sarah,thereal

questionisnotwhattodoaboutElizabethbutwhatdoyoudoaboutall

theElizabethsinyourfuture?

“Youdidthebestyoucould.AndsodidElizabeth.It’stimetogeton

withyourlife.Tobuildyourbusinessinanenliveningway.Areyou

ready?”

Sarahsmiledatme,hereyespositivelygleaming.

“I’mreadyifyouare,”shesaid.

“Thenlet’stalkaboutMaturityforaminute,”Isaid.

“Becausethat’swhereyourfuturelies.”

6MATURITYANDTHEENTREPRENEURIAL

PERSPECTIVETheyseethepattern,understandtheorder,experiencethevision.

PeterDrucker

TheNewSociety

Maturity,thethirdphaseofacompany’sgrowth,isexemplifiedbythe

bestbusinessesintheworld.BusinessessuchasMcDonald’s,Federal

Express,andDisney.

AMaturebusinessknowshowitgottobewhereitis,andwhatit

mustdotogetwhereitwantstogo.

Therefore,Maturityisnotaninevitableresultofthefirsttwophases.

Itisnottheendproductofaserialprocess,beginningwithInfancyand

movingthroughAdolescence.

No,companieslikeMcDonald’s,FederalExpress,andDisneydidn’t

endupasMaturecompanies.Theystartedoutthatway!Thepeoplewho

startedthemhadatotallydifferentperspectiveaboutwhatabusinessis

andwhyitworks.

ThepersonwholauncheshisbusinessasaMaturecompanymust

alsogothroughInfancyandAdolescence.Hesimplygoesthroughthem

inanentirelydifferentway.

It’shisperspectivethatmakesthedifference.

HisEntrepreneurialPerspective.

TheEntrepreneurialPerspective

IonceheardastoryaboutTomWatson,thefounderofIBM.Askedto

whatheattributedthephenomenalsuccessofIBM,heissaidtohave

answered:

IBMiswhatitistodayforthreespecialreasons.Thefirstreasonisthat,

attheverybeginning,Ihadaveryclearpictureofwhatthecompany

wouldlooklikewhenitwasfinallydone.YoumightsayIhadamodelin

mymindofwhatitwouldlooklikewhenthedream—myvision—wasin

place.

ThesecondreasonwasthatonceIhadthatpicture,Ithenasked

myselfhowacompanywhichlookedlikethatwouldhavetoact.Ithen

createdapictureofhowIBMwouldactwhenitwasfinallydone.

ThethirdreasonIBMhasbeensosuccessfulwasthatonceIhada

pictureofhowIBMwouldlookwhenthedreamwasinplaceandhow

suchacompanywouldhavetoact,Ithenrealizedthat,unlesswebegan

toactthatwayfromtheverybeginning,wewouldnevergetthere.

Inotherwords,IrealizedthatforIBMtobecomeagreatcompanyit

wouldhavetoactlikeagreatcompanylongbeforeiteverbecameone.

Fromtheveryoutset,IBMwasfashionedafterthetemplateofmy

vision.Andeachandeverydayweattemptedtomodelthecompany

afterthattemplate.Attheendofeachday,weaskedourselveshowwell

wedid,discoveredthedisparitybetweenwherewewereandwherewe

hadcommittedourselvestobe,and,atthestartofthefollowingday,set

outtomakeupforthedifference.

EverydayatIBMwasadaydevotedtobusinessdevelopment,not

doingbusiness.

Wedidn’tdobusinessatIBM,webuiltone

Now,it’sbeenmorethanthirtyyearssinceTomWatsonSr.spoke

aboutthereasonsforIBM’ssuccessandIrecognizewhatpeoplemight

sayaboutthis$88.4billioncompany.Thatit’sabusinessintrouble.That

it’slostitsway.Thatit’shardlyanexemplarforanybusinessownerto

follow.ButifWatsonwerealivetoday,I’mcertainitwouldbedifferent.

I’mcertainthattheentrepreneurialgeniusthatgaverisetoIBMwould,if

itwerepresenttoday—andIdon’tknowthatitisn’t,butallthesignsare

there—beengagedinthereinventionofthecompanyassurelyasithad

beenreinventedtimeandtimeagain,tore-createitsfutureasthefuture

demanded.

Inshort,mystorytellermaynothavehadWatson’swordsexactly

verbatim,butwhatthestorytellsusisveryimportant.

Itrevealsanunderstandingofwhatmakesagreatbusinessgreat.

Italsotellsuswhatmakesallotherbusinessessurvivableattheir

best;intolerableattheirworst.

Ittellsusthattheverybestbusinessesarefashionedafteramodelof

abusinessthatworks.

IttellsusthatitistheEntrepreneurialPerspectivethatsaysit’snot

thecommodityortheworkitselfthatisimportant.What’simportantis

thebusiness:howitlooks,howitacts,howitdoeswhatitisintendedto

do.

ItsaysthatTomWatsonSr.hadapassionfortheenterpriseitself.

Andthat,unfortunately,mostpeoplewhogointobusinessdon’t.

Thatmostpeoplewhogointobusinessdon’thaveamodelofa

businessthatworks,butofworkitself,aTechnician’sPerspective,which

differsfromtheEntrepreneurialPerspectiveinthefollowingways:

TheEntrepreneurialPerspectiveasksthequestion:“How

mustthebusinesswork?”TheTechnician’sPerspective

asks:“Whatworkhastobedone?”

TheEntrepreneurialPerspectiveseesthebusinessasa

systemforproducingoutsideresults—forthecustomer—

resultinginprofits.TheTechnician’sPerspectiveseesthe

businessasaplaceinwhichpeopleworktoproduceinside

results—forTheTechnician—producingincome.

TheEntrepreneurialPerspectivestartswithapictureofa

well-definedfuture,andthencomesbacktothepresent

withtheintentionofchangingittomatchthevision.The

Technician’sPerspectivestartswiththepresent,andthen

looksforwardtoanuncertainfuturewiththehopeof

keepingitmuchlikethepresent.

TheEntrepreneurialPerspectiveenvisionsthebusinessin

itsentirety,fromwhichisderiveditsparts.The

Technician’sPerspectiveenvisionsthebusinessinparts,

fromwhichisconstructedthewhole.

TheEntrepreneurialPerspectiveisanintegratedvisionof

theworld.TheTechnician’sPerspectiveisafragmented

visionoftheworld.

ToTheEntrepreneur,thepresent-dayworldismodeled

afterhisvision.ToTheTechnician,thefutureismodeled

afterthepresent-dayworld.

IsitanywonderthattheEntrepreneurialPerspectiveisabsolutely

necessaryforthecreationofagreatbusiness,whileTheTechnician’s

producesitsexactopposite?

TheEntrepreneurialPerspectiveadoptsawider,moreexpansive

scale.Itviewsthebusinessasanetworkofseamlesslyintegrated

components,eachcontributingtosomelargerpatternthatcomes

togetherinsuchawayastoproduceaspecificallyplannedresult,a

systematicwayofdoingbusiness.

Eachstepinthedevelopmentofsuchabusinessismeasurable,ifnot

quantitatively,atleast,qualitatively.There’sastandardforthebusiness,

aform,awayofbeingthatcanbetranslatedintothingstodotodaythat

bestexemplifyit.Thebusinessoperatesaccordingtoarticulatedrules

andprinciples.Ithasaclear,recognizableform.

WithTheTechnician’sPerspective,however,thescaleisnarrower,

moreinhibited,confinedprincipallytotheworkbeingdone.

Asaresult,TheTechnician’sbusinessbecomesincreasingly

oppressive,lessexhilarating,closedofffromthelargerworldoutside.

Hisbusinessisreducedtostepsthatfailtotakehimanywhereother

thantothenextstep,itselfnothingmorethanareplicaoftheonebefore

it.

Routinebecomestheorderoftheday.

Workisdoneforwork’ssakealone,forsakinganyhigherpurpose,any

meaningforwhatneedstobedoneotherthantheneedtojustdoit.

TheTechnicianseesnoconnectionbetweenwherehisbusinessis

goingandwhereitisnow.

Lackingthegranderscaleandvisionaryguidancemanifestinthe

EntrepreneurialModel,TheTechnicianislefttoconstructamodeleach

stepoftheway.

Buttheonlymodelfromwhichtoconstructitisthemodelofpast

experience,themodelofwork.Exactlytheoppositeofwhatheneedsif

thebusinessistofreehimoftheworkhe’sgrownaccustomedtodoing.

TheEntrepreneurialModel

WhatdoesTheEntrepreneurseeoffinthedistancethatThe

Technicianfindssodifficulttosee?WhatexactlyistheEntrepreneurial

Model?

It’samodelofabusinessthatfulfillstheperceivedneedsofaspecific

segmentofcustomersinaninnovativeway.

TheEntrepreneurialModellooksatabusinessasifitwereaproduct,

sittingonashelfandcompetingforthecustomer’sattentionagainsta

wholeshelfofcompetingproducts(orbusinesses).

Saidanotherway,theEntrepreneurialModelhaslesstodowith

what’sdoneinabusinessandmoretodowithhowit’sdone.The

commodityisn’twhat’simportant—thewayit’sdeliveredis.

WhenTheEntrepreneurcreatesthemodel,hesurveystheworldand

asks:“Whereistheopportunity?”Havingidentifiedit,hethengoesback

tothedrawingboardandconstructsasolutiontothefrustrationshe

findsamongacertaingroupofcustomers.Asolutionintheformofa

businessthatlooksandactsinaveryspecificway,thewaythecustomer

needsittolookandact,notTheEntrepreneur.

“Howwillmybusinesslooktothecustomer?”TheEntrepreneurasks.

“Howwillmybusinessstandoutfromalltherest?”

Thus,theEntrepreneurialModeldoesnotstartwithapictureofthe

businesstobecreatedbutofthecustomerforwhomthebusinessistobe

created.

Itunderstandsthatwithoutaclearpictureofthatcustomer,no

businesscansucceed.

TheTechnician,ontheotherhand,looksinwardly,todefinehisskills,

andonlylooksoutwardlyafterwardtoask,“HowcanIsellthem?”

Theresultingbusinessalmostinevitablyfocusesonthethingitsells

ratherthanthewaythebusinessgoesaboutitorthecustomertowhom

it’stobesold.

SuchabusinessisdesignedtosatisfyTheTechnicianwhocreatedit,

notthecustomer.

ToTheEntrepreneur,thebusinessistheproduct.

ToTheTechnician,theproductiswhathedeliverstothecustomer.

ToTheTechnician,thecustomerisalwaysaproblem.Becausethe

customerneverseemstowantwhatTheTechnicianhastoofferatthe

priceatwhichheoffersit.

ToTheEntrepreneur,however,thecustomerisalwaysan

opportunity.BecauseTheEntrepreneurknowsthatwithinthecustomer

isacontinuingparadeofchangingwantsbeggingtobesatisfied.AllThe

Entrepreneurhastodoisfindoutwhatthosewantsareandwhatthey

willbeinthefuture.

Asaresult,theworldisacontinuingsurprise,atreasurehunttoThe

Entrepreneur.

ToTheTechnician,however,theworldisaplacethatneverseemsto

lethimdowhathewantstodo;itrarelyapplaudshisefforts;itrarely

appreciateshiswork;itrarely,ifever,appreciateshim.ToThe

Technician,theworldalwayswantssomethinghedoesn’tknowhowto

giveit.

Thequestionthenbecomes,howcanweintroducethe

entrepreneurialmodeltoTheTechnicianinsuchawaythathecan

understanditandutilizeit?

Theansweris,unfortunately,wecan’t.

TheTechnicianisn’tinterested.

TheTechnicianhasotherthingstodo.

Ifwearetobesuccessfulatthis,whatwemustdo,instead,istogive

theundevelopedEntrepreneurineachofustheinformationheneedsto

growbeyondthelimitationsofTheTechnician’sComfortZonesoasto

experienceavisionofabusinessthatworks.

Whatwemustdo,instead,istoprovideourinnerentrepreneurwitha

modelofabusinessthatworks,amodelthatissoexcitingthatit

stimulatesourentrepreneurialpersonality—ourinnovativeside—tobreak

freeofTheTechnician’sbondsonceandforall.

Whatwemustdo,instead,isdiscoveramodelthatsparksthe

entrepreneurialimaginationineachofuswithsucharesoundingshock

thatbythetimeTheTechnicianwakesuptothefactitwillbetoolate,

TheEntrepreneurwillbewellonhisway.

But,atthesametime,ifthemodelistowork,ifthemodelisto

awakenTheEntrepreneurwithineachofustobegintorebuildour

businessesaroundtheEntrepreneurialPerspectivetheysodesperately

needtoflourish,TheManagerandTheTechnicianneedtheirown

models.

BecauseifTheEntrepreneurdrivesthebusiness,TheManagermust

makecertainithasthenecessaryfuelforsustenance,andthattheengine

andchassisareinagoodstateofrepair.

IfTheTechnicianistobesatisfied,ontheotherhand,theremustbea

modelthatprovideshimwithworkthatsatisfieshisneedfordirect

interactionwitheverynutandbolt.

Inshort,forthisbusinessmodelofourstowork,itmustbebalanced

andinclusivesothatTheEntrepreneur,TheManager,andThe

Technicianallfindtheirnaturalplacewithinit,sothattheyallfindthe

rightworktodo.

Tofindsuchamodel,letusexaminearevolutionarydevelopment

thathastransformedAmericansmallbusinessinanastonishingway.

IcallittheTurn-KeyRevolution.

ItwastimeforSarahtoopenherstore.Andwestillhadalotofworkto

do.

“I’llcomebacktonight,”Isaid.“CanIansweranyquestionsbeforeI

leave?”

“Yes,”Sarahsmiled.“Howsooncanwegetstarted?”

Formoreinformation,visitusatwww.e-myth.com

PARTII

TheTurn-KeyRevolution:ANewViewofBusiness

7THETURN-KEYREVOLUTION

Systemstheorylooksattheworldintermsoftheinterrelatedness

ofallphenomena,andinthisframeworkanintegratedwhole

whosepropertiescannotbereducedtothoseofitspartsiscalleda

system.

FritjofCapra

TheTurningPoint

TheIndustrialRevolution,theTechnologicalRevolution,the

InformationExplosionareallfamiliarphenomenaintoday’sworld.

Thereisnoquestionoftheimpacteachhashadonourlives.

IfaskedtodescribetheTurn-KeyRevolution,however,mostpeople

wouldsimplyrespondwithablankstare.

YettheimpactoftheTurn-KeyRevolutiononAmericansmall

business,andtheinferenceswecandrawaboutthatimpactforthe

future,areasprofoundasanyofthephenomenacitedabove.

ForattheheartoftheTurn-KeyRevolutionisawayofdoingbusiness

thathasthepowertodramaticallytransformanysmallbusiness—indeed,

anybusiness,nomatterwhatitssize—fromaconditionofchaosand

diseasetoaconditionoforder,excitement,andcontinuousgrowth.Itis

theTurn-KeyRevolutionthatprovidesuswiththatillusivekeytothe

developmentofanextraordinarybusiness:theultimatelybalancedmodel

ofabusinessthatworks.

TheFranchisePhenomenon

Itallstartedin1952whenafifty-two-year-oldsalesmanwalkedintoa

hamburgerstandinSanBernardino,California,tosellthetwobrothers

whoowneditamilkshakemachine.

Whathesawtherewasamiracle.

Atleastthat’showRayKroc,themilkshakemachinesalesman,might

havedescribedit.Forhehadneverseenanythinglikethatveryfirst

MacDonald’s(latertobecomeMcDonald’s)hamburgerstand.

ItworkedlikeaSwisswatch!

Hamburgerswereproducedinawayhe’dneverseenbefore—quickly,

efficiently,inexpensively,andidentically.

Bestofall,anyonecoulddoit.

Hewatchedhighschoolkidsworkingwithprecisionunderthe

supervisionoftheowners,happilyrespondingtothelonglinesof

customersqueuedupinfrontofthestand.

ItbecameapparenttoRayKrocthatwhattheMacDonaldbrothers

hadcreatedwasnotjustanotherhamburgerstandbutamoneymachine!

Soonafterthatfirstvisit,andpossessedbyapassionhehadneverfelt

quitelikethatbefore,RayKrocconvincedMacandJimMacDonaldtolet

himfranchisetheirmethod.

Twelveyearsandseveralmillionhamburgerslater,heboughtthem

outandwentontocreatethelargestretailpreparedfooddistribution

systemintheworld.

“TheMostSuccessfulSmallBusinessintheWorld”

That’swhatMcDonald’scallsitselftoday.

Andforgoodreason.

BecausethesuccessofMcDonald’sistrulystaggering.

Thinkaboutit.Inlessthanfortyyears,RayKroc’sMcDonald’shas

becomea$40-billion-a-yearbusiness,with28,707restaurantsworldwide

—andgrowinginnumbereveryminute—servingfoodtomorethan43

millionpeopleeverydayin120countries,representingmorethan10

percentofthegrossrestaurantreceiptsinAmerica!

TheaverageMcDonald’srestaurantproducesmorethan$2millionin

annualsales,andismoreprofitablethanalmostanyotherretailbusiness

intheworld,withanaverage17percentpretaxnetprofit.

ButRayKroccreatedmuchmorethanjustafantasticallysuccessful

business.Hecreatedthemodeluponwhichanentiregenerationof

entrepreneurshavesincebuilttheirfortunes—amodelthatwasthe

genesisofthefranchisephenomenon.

Itstartedasatricklewhenafewentrepreneursbegantoexperiment

withKroc’sformulaforsuccess.Butitwasn’tlongbeforethetrickle

turnedintoNiagaraFalls!

In2000,therewere320,000franchisedbusinessesin75industries.

Franchisesproduce$1-trillioninsaleseachyear—almost50percentof

everyretaildollarspentinthenation—andhadmorethan8millionfull-

andpart-timepeople,thelargestemployerofhighschoolyouthinthe

country’seconomy.

ButthegeniusofMcDonald’sisn’tfranchisingitself.Thefranchise

hasbeenaroundformorethanahundredyears.Manycompanies—Coca-

ColaandGeneralMotorsamongthem—haveutilizedfranchisingasan

effectivemethodofdistributiontoreachbroadlyexpandingmarkets

inexpensively.ThetruegeniusofRayKroc’sMcDonald’sistheBusiness

FormatFranchise.

ItistheBusinessFormatFranchisethathasrevolutionizedAmerican

business.

ItistheBusinessFormatFranchise,withonenewfranchiseopening

itsdoorseveryeightminutesofeverysinglebusinessday,thathas

spawnedsomuchofthesuccessofthefranchisephenomenonoverthe

pastfortyyears.

And,accordingtostudiesconductedbytheU.S.Commerce

Departmentfrom1971to1987,lessthan5percentoffranchiseshave

beenterminatedonanannualbasis,or25percentinfiveyears.

Comparethatstatistictothemorethan80-percentfailurerateof

independentlyownedbusinesses,andyoucanimmediatelyunderstand

thepoweroftheTurn-KeyRevolutioninoureconomy,andthe

contributionthattheBusinessFormatFranchisehasmadetoitandthe

futuresuccessofyourbusiness.

TurningtheKey:TheBusinessFormatFranchise

Theearlyfranchisebusinesses,manyofwhichstillexist,werecalled

“tradename”franchises.

Underthissystem,thefranchisorlicensestherighttosmall

companiestomarketitsnationallyknownproductslocally.

ButtheBusinessFormatFranchisemovesastepbeyondthetrade

namefranchise.

TheBusinessFormatFranchisenotonlylendsitsnametothesmaller

enterprisebutitalsoprovidesthefranchiseewithanentiresystemof

doingbusiness.

AndinthatdifferenceliesthetruesignificanceoftheTurn-Key

Revolutionanditsphenomenalsuccess.

TheTurn-KeyRevolutionandtheBusinessFormatFranchisewere

bornofabeliefthatrunscountertowhatmostbusinessfoundersinthis

countrybelieve.

Mostbusinessfoundersbelievethatthesuccessofabusinessresides

inthesuccessoftheproductitsells.

Tothetradenamefranchisor,thevalueofthefranchiseliesinthe

valueofthebrandnamethatitislicensing:Cadillac,Mercedes,Coca-

Cola.

Therewasatimewhenthatbeliefwastrue,butitisn’tanymore.Ina

worldwherebrandnamesproliferatelikesnowflakesinaMinnesota

blizzard,itbecomesmoreandmoredifficult—andinfinitelymore

expensive—toestablishasecurepositionwithabrandnameandexpect

tokeepit.

Asaresult,tradenamefranchiseshavebeendecliningoverthesame

periodthatfranchisingingeneralhasbeenexplodingatan

unprecedentedrate.

ItistheBusinessFormatFranchisethathasaccountedforthat

growth.

BecausetheBusinessFormatFranchiseisbuiltonthebeliefthatthe

trueproductofabusinessisnotwhatitsellsbuthowitsellsit.

Thetrueproductofabusinessisthebusinessitself.

WhatRayKrocunderstoodatMcDonald’swasthatthehamburger

wasn’thisproduct.McDonald’swas.

Andhebelievedthatforamostimportantreason.

SellingtheBusinessInsteadoftheProduct

RayKrocwastheconsummateentrepreneur.Andlikemost

entrepreneurs,hesufferedfromonemajorliability.Hehadahugedream

andverylittlemoney.

Enterthefranchisee.

ThefranchiseebecamethevehicleforRayKroctorealizehisdream.

Atthatpoint,RayKrocbegantolookathisbusinessastheproduct,

andatthefranchiseeashisfirst,last,andmostimportantcustomer.

Forthefranchiseewasn’tinterestedinhamburgersorfrenchfriesor

milkshakes;hewasinterestedinthebusiness.

Drivenbyhisdesiretobuyabusiness,thefranchiseeonlywantedto

knowonething:“Doesitwork?”

RayKroc’smostimportantconcernthenbecamehowtomakecertain

hisbusinesswouldworkbetterthananyother.

IfMcDonald’swastofulfillthedreamhehadforit,thefranchisee

wouldhavetobewillingtobuyit.

AndtheonlywayRayKroccouldassurehimselfofthatwastomake

certainthatMcDonald’sworkedbetterthananyoftheotherbusiness

productsaround.

Attheoutset,RayKrocwasn’tjustcompetingwithotherhamburger

businesses—hewascompetingwitheveryotherbusinessopportunity

around!

ButtherewasasecondreasonthatRayKrochadformakingcertain

McDonald’swouldwork.

Giventhefailurerateofmostsmallbusinesses,hemusthaverealized

acrucialfact:forMcDonald’stobeapredictablesuccess,thebusiness

wouldhavetowork,becausethefranchisee,iflefttohisowndevices,

mostassuredlywouldn’t!

Onceheunderstoodthis,RayKroc’sproblembecamehisopportunity.

Forcedtocreateabusinessthatworkedinordertosellit,healso

createdabusinessthatwouldworkonceitwassold,nomatterwho

boughtit.

Armedwiththatrealization,hesetaboutthetaskofcreatinga

foolproof,predictablebusiness.

Asystems-dependentbusiness,notapeople-dependentbusiness.

Abusinessthatcouldworkwithouthim.

Unlikemostsmallbusinessownersbeforehim—andsince—RayKroc

wenttoworkonhisbusiness,notinit.

Hebegantothinkabouthisbusinesslikeanengineerworkingona

pre-productionprototypeofamass-produceableproduct.

HebegantoreengineerMcDonald’sdecadesbeforethewordandthe

processcameintofashion.

HebegantothinkaboutMcDonald’sjustlikeHenryFordmusthave

thoughtabouttheModelT.

Howcouldthecomponentsoftheprototypebeconstructedsothatit

couldbeassembledataverylowcostwithtotallyinterchangeableparts?

Howcouldthecomponentsbeconstructedsothattheresulting

businesssystemcouldbereplicatedoverandoveragain,eachbusiness

working—justliketheModelT—asreliablyasthethousandsthat

precededit?

WhatRayKrocdidwastoapplythethinkingbehindtheIndustrial

RevolutiontotheprocessofBusinessDevelopment,andtoadegreenever

beforeexperiencedinabusinessenterprise.

Thebusiness-as-a-productwouldonlysellifitworked.Andtheonly

waytomakecertainitwouldworkinthehandsofafranchiseeanywhere

intheworldwouldbetobuilditoutofperfectlypredictablecomponents

thatcouldbetestedinaprototypelongbeforeevergoingintomass

production.

ThereinliesthesecretbehindthestunningsuccessoftheBusiness

FormatFranchise,thelaunchingpadfortheTurn-KeyRevolution.

ThatsecretistheFranchisePrototype.

ItisintheFranchisePrototypethateverysuccessfulfranchisorbuilds

hisfuture.

ItisintheFranchisePrototypethateveryextraordinaryfranchisor

plantstheseedsofhisfortune.

AnditisintheFranchisePrototypethatyoucanfindthemodelyou

needtomakeyourbusinesswork.

SarahandIcouldn’thavepickedabettertimetohavethisconversation.

IfshehadeverfelttheweightofbeingaTechnician-turned-business-

owner,caughtupinthedoingofherbusinessandtheinordinateprice

shewaspayingforit,itwasrightnow.

Itwasteno’clockatnight.Asusual,shehadhadatumultuousday.

Herfacewasflushwiththeexertionofmoppingthefloors,bundlingand

tossingoutthetrash,preparingtheovensforthenextday,cleaningthe

counterstotheiroriginalhighluster—inadditiontoafulldayofwaiting

oncustomers;servinguppie,coffee,andtea;washing,drying,and

stackingplates,cups,saucers;andshiningthesilver.

Andyet,withallthathadgoneonintheshopthatday,youcouldn’t

haveknownit;for,asalways,theshopwasimpeccable.And,despitethe

costtoherofkeepingitthatway,Icouldn’thelpbutnoticethedeep

satisfactionSarahfeltasshesurveyedherdomain.Butshewasobviously

tired.

Wepulledtwochairsuptoatableandquietlysippedtheteashehad

preparedforus.Thelargeclocktickedemphaticallyonthewall,

punctuatingoursilence.Anoccasionalcardrovebytheshop.People

walkedbytheshop’swindows,occasionallylookingintotheshopasthey

continuedontheirjourneyintothenight.

IwaitedforasignfromSarahthatshewasready.

Finally,shebeganthoughtfullyandquietly.“Youtalkabout

McDonald’sasanexampletobemodeled.I’mnotsureIagreewithyou

aboutthat.Iknowifmyauntwereheretoday,shewouldthinkof

McDonald’sasexactlytheoppositeofwhatyou’vesuggesteditis.Talkto

meaboutthat,”shesaid.“I’minterestedinhowyouwouldrespondtomy

aunt,aboutwhatyouwouldsaytoher.”

“Youknow,Sarah,”Ibegan,“Icansensethatsomethinghasshiftedin

youtoday.Somethingimportant.Icansensealsofromthetoneofyour

questionthatyou’retrulyinterestedinpursuingthisquestionabout

McDonald’s,andI’minspiredtoengageinthequestionwithyouatthe

deepestlevel.Iwanttothankyouforthat.

“It’strue,manysmallbusinessownersatfirstmisunderstandmy

pointaboutMcDonald’s.Theyassociatefastfoodwithlowquality.They

infer,then,thatbysettingMcDonald’supasanexample,I’msuggesting

thatonecanbeincrediblysuccessfulinbusinessdespitetheseemingly

lowqualityoftheproductdelivered.Whenexactlytheoppositeistrue.

But,letmegetbacktothatinamoment.

“Asforyouraunt,eventhoughIhavenevermether,fromtheway

youhavedescribedherIfeelIknowher.AndthisiswhatIwouldsayto

herifshewerehereaskingmethequestionherself:

“IwouldsaythatRayKrocwasamanwithapurpose.Hispurpose

wasclear,undiluted,andsure.Helivedinanordinaryworld,likeweall

do,aworldinwhichmostthingsdidn’tworkthewaytheyweresupposed

to.AtMcDonald’s,hesawsomethingthatdidwork,exactlyasitwas

supposedto,timeaftertimeaftertime.ToRayKroc,thatwasan

inspiration.Infact,hewasawedbyit.Hewasasimpleman.Andhefell

inlovewiththesheerenormityofthethinghecalledMcDonald’s.

“Ascertainlyasyoulovedbakingpies,RayKroclovedmaking

McDonald’s.Ascertainlyasyoulovedproducinganexceptionalpie,Ray

Kroclovedproducinganexceptionalresult,thesameway,withthesame

impact,timeaftertime.Ascertainlyasyoulovedthearoma,thesmells,

thesight,thetaste,ofyourkitchen,RayKroclovedthearoma,thesmells,

thesight,thetasteofMcDonald’s.Hewasamaninlove.

“Now,fromtheoutsidein,Icanunderstandwhyyoumightbecritical

ofMcDonald’s.Youmightsaythatpeopleshouldn’teatmeat.Youmight

saythatthehamburgerscouldbefatter,orlessfatty,orthisorthat.But

whatyoucouldn’tsay—whatyoucouldneversay—isthatMcDonald’s

doesn’tkeepitspromise.Becauseitdoes.Betterthanjustaboutany

businessintheworld,McDonald’s,theloveofRayKroc’slife,stillkeeps

itspromise,longafterRayKrochasgone.Itdeliversexactlywhatwehave

cometoexpectofiteverysingletime.

“Sothat’swhyIlookuponMcDonald’sasamodelforeverysmall

business.

“Becauseitcandoinitsmorethan28,000storeswhatmostofus

can’tdoinone!

“Andtome,that’swhatintegrityisallabout.It’saboutdoingwhat

yousayyouwilldo,and,ifyoucan’t,learninghow.

“Ifthatisthemeasureofanincrediblebusiness—andIbelieveitis—

thenthereisnomoreincrediblebusinessthanMcDonald’s.Whoamong

ussmallbusinessownerscansaywedothingsaswell?

“ButMcDonald’sisevenmoreimportantthanthat.

“McDonald’shasnotonlycreatedanextraordinarybusiness,ithas

createdforallofussmallbusinessownersanextraordinarywaytocreate

anextraordinarybusiness.Ithascreatedamodelwecanemulate.

“Andtheprofoundimpactthatthathashadonoureconomyoverthe

pastfourdecadesisbeyondourcomprehension.

“So,Sarah’saunt,IhonestlybelieveifyouhadknownRayKroc,you

wouldhavediscoveredinhimakindredspirit.

“Youwouldhaveinvitedhimintoyourkitchenandhewouldhave

invitedyouintohis.

“Youwouldhavediscussedwithhimwithgreatpassiontheartof

creatingafinepiecrustandhewouldhavediscussedwithyou—withjust

asgreatapassion—theartofcreatingafinefrenchfry.

“Youwouldhavesharedwithhimyoursecretforpreparingthefruit,

justashewouldsharewithyouhissecretforpreparingthehamburger

bunshesolovinglydevotedhimselfto.

“Youaretwopeasinapodwithonebigexception.

“You,Sarah’saunt,hadbutonekitcheninwhichyoulovedtowork,

yourkitchen,makingyourpies,alone,orwithSarahbyyourside.

“RayKrochadthousandsofkitchens,inwhichhelovedtowork,

perfectingallthetimehisabilitytotouchmillionsofpeoplewiththe

samelovingattentionyou’velavishedonafew.

“YouareaTechnician,acraftsperson,wholoveswhatyoudo.

“HewasanEntrepreneur,albeitstillacraftsperson,wholovedwhat

hedid.

“Theonlydifferencebetweenthetwoofyouisanorderofmagnitude.

“Soletmetellyouhowhecraftedsomethingthatsize.”

8THEFRANCHISEPROTOTYPE

Precisioninstrumentsaredesignedtoachieveanidea,

dimensionalprecision,whereperfectionisimpossible.Thereisno

perfectlyshapedpartofthemotorcycleandneverwillbe,but

whenyoucomeascloseastheseinstrumentstakeyou,

remarkablethingshappen,andyougoflyingacrossthe

countrysideunderapowerthatwouldbecalledmagicifitwere

notsocompletelyrationalineveryway.

RobertM.Pirsig

ZenandtheArtofMotorcycleMaintenance

ThesuccessoftheBusinessFormatFranchiseiswithoutquestionthe

mostimportantnewsinbusiness.

Overthecourseofoneyear,BusinessFormatFranchiseshave

reportedasuccessrateof95percentincontrasttothe50-plus-percent

failurerateofnewindependentlyownedbusinesses.Where80percentof

allbusinessesfailinthefirstfiveyears,75percentofallBusinessFormat

Franchisessucceed!

ThereasonforthatsuccessistheFranchisePrototype.

Tothefranchisor,thePrototypebecomestheworkingmodelofthe

dream;itisthedreaminmicrocosm.ThePrototypebecomesthe

incubatorandthenurseryforallcreativethought,thestationwhere

creativityisnursedbypragmatismtogrowintoaninnovationthatworks.

TheFranchisePrototypeisalsotheplacewhereallassumptionsare

puttothetesttoseehowwelltheyworkbeforebecomingoperationalin

thebusiness.

Withoutitthefranchisewouldbeanimpossibledream,aschaotic

andundisciplinedasanybusiness.

ThePrototypeactsasabufferbetweenhypothesisandaction.Putting

ideastothetestintherealworldratherthantheworldofcompeting

ideas.Theonlycriterionofvaluebecomestheanswertotheultimate

question:“Doesitwork?”

OncehavingcompletedhisPrototype,thefranchisorthenturnstothe

franchiseeandsays,“Letmeshowyouhowitworks.”

Andworkitdoes.Thesystemrunsthebusiness.Thepeoplerunthe

system.

IntheFranchisePrototype,thesystembecomesthesolutiontothe

problemsthathavebesetallbusinessesandallhumanorganizations

sincetimeimmemorial.

Thesystemintegratesalltheelementsrequiredtomakeabusiness

work.Ittransformsabusinessintoamachine,ormoreaccurately,

becauseitissoalive,intoanorganism,drivenbytheintegrityofitsparts,

allworkinginconcerttowardarealizedobjective.And,withitsPrototype

asitsprogenitor,itworkslikenothingelsebeforeit.

AtRayKroc’sMcDonald’s,everypossibledetailofthebusiness

systemwasfirsttestedinthePrototype,andthencontrolledtoadegree

neverbeforepossibleinapeople-intensivebusiness.

Thefrenchfrieswereleftinthewarmingbinfornomorethanseven

minutestopreventsogginess.AsoggyfrenchfryisnotaMcDonald’s

frenchfry.

Hamburgerswereremovedfromthehottraysinnomorethanten

minutestoretainthepropermoisture.

Thefrozenmeatpatties,preciselyidenticalinsizeandweight,were

turnedatexactlythesametimeonthegriddle.

Pickleswereplacedbyhandinasetpatternthatpreventedthemfrom

slidingoutandlandinginthecustomer’slap.

Foodwasservedtothecustomerinsixtysecondsorless.

Discipline,standardization,andorderwerethewatchwords.

Cleanlinesswasenforcedwithmeticulousattentiontothemost

seeminglytrivialdetail.

RayKrocwasdeterminedthatthecustomerwouldnotequate

inexpensivewithinattentiveorcheap.Nowherehadabusinesseverpaid

somuchattentiontothelittlethings,tothesystemthatguaranteedthe

customerthatherexpectationswouldbefulfilledinexactlythesameway

everytime.

Unlikethetradenamefranchisebeforeit,RayKroc’ssystemleftthe

franchiseewithaslittleoperatingdiscretionaspossible.

Thiswasaccomplishedbysendinghimthrougharigoroustraining

programbeforeeverbeingallowedtooperatethefranchise.

AtMcDonald’s,theycalledittheUniversityofHamburgerology,or

HamburgerU.

There,thefranchiseelearnednothowtomakehamburgersbuthow

torunthesystemthatmakeshamburgers—thesystembywhich

McDonald’ssatisfieditscustomerseverysingletime.Thesystemthatwas

tobethefoundationofMcDonald’suncommonsuccess.

IsitanywonderthatMcDonald’scallsitself“TheMostSuccessful

SmallBusinessInTheWorld!”

Itis!

EverysingleextraordinarydetailRayKrocinventedfourdecadesago

isevenmoreextraordinarytoday.

WhetheritisHamburgerU,ortheplacementofpickles,orthe

exactingwayinwhichthebunsarewarmedbeforeserving,orthe

thicknessofthepatty—allofit,today,longafterRayKrochasgone,is

stillknownbythefranchiseeasthesystemattheheartofMcDonald’s.

Andjustasitwasthen,itisnow.Oncethefranchiseelearnsthe

system,heisgiventhekeytohisownbusiness.

Thus,thename:Turn-KeyOperation.

Thefranchiseeislicensedtherighttousethesystem,learnshowto

runit,andthen“turnsthekey.”Thebusinessdoestherest.

Andthefranchiseesloveit!

Becauseifthefranchisorhasdesignedthebusinesswell,every

problemhasbeenthoughtthrough.Allthat’sleftforthefranchiseetodo

islearnhowtomanagethesystem.

That’swhattheFranchisePrototypeisallabout.

It’saplacetoconceiveandperfectthesystem.Tofindoutwhatworks

becauseyou’veworkedit.

Thesystemisn’tsomethingyoubringtothebusiness.It’ssomething

youderivefromtheprocessofbuildingthebusiness.

TheFranchisePrototypeistheanswertotheperpetualquestion:

“HowdoIgivemycustomerwhathewantswhilemaintainingcontrolof

thebusinessthat’sgivingittohim?”

ToTheEntrepreneur,theFranchisePrototypeisthemediumthrough

whichhisvisiontakesformintherealworld.

ToTheManager,theFranchisePrototypeprovidestheorder,the

predictability,thesystemsoimportanttohislife.

ToTheTechnician,thePrototypeisaplaceinwhichheisfreetodo

thethingshelovestodo—technicalwork.

Andtothesmallbusinessowner,theFranchisePrototypeprovides

themeansthroughwhichhecanfinallyfeedhisthreepersonalitiesina

balancedwaywhilecreatingabusinessthatworks.

So,nowyouhaveit:theFranchisePrototypeisthemodelyou’vebeen

lookingfor.TheFranchisePrototypeisthemodelofabusinessthat

works.ThebalancedmodelthatwillsatisfyTheEntrepreneur,The

Manager,andTheTechnicianallatonce.

Andit’sbeenthereallthetime!

It’sbeenthereatMcDonald’s.AndatFederalExpress.AndatDisney

World.AndatMrs.Field’sCookies.

It’sbeenthereatSubwaySandwichesandDomino’sPizzaand

KentuckyFriedChickenandPizzaHut.

It’sbeenthereatTacoBellandUPSandUniversalStudios.

It’sbeenthere,waitingforyoutodiscoverit,allthistime!

It’sbeenthereintheformofaProprietaryOperatingSystematthe

heartofeveryextraordinarybusinessaroundyou,franchisedornot.

Because,afterall,that’sallthatanyBusinessFormatFranchisereally

is.

Itisaproprietarywayofdoingbusinessthatsuccessfullyand

preferentiallydifferentiateseveryextraordinarybusinessfromevery

oneofitscompetitors.Inthislight,everygreatbusinessintheworldisa

franchise.

Thequestionis:Howdoyoubuildyours?Howdoyouputthis

powerfullyliberatingideatoworkforyou?

HowdoyoucreateyourFranchisePrototype?

Howdoyou,likeRayKroc,buildabusinessthatworkspredictably,

effortlessly,andprofitablyeachandeveryday?

Howdoyoubuildabusinessthatworkswithoutyou?

Howdoyougetfreeofyourbusinesstoliveafullerlife?

Doyougetit?Doyouseewhythisissoimportant?

Becauseuntilyoudoit,yourbusinesswillcontrolyourlife!

Butonceyoubegintoputthisideatoworkforyou,you’reontheway

tobeingfree!

IcouldseethatSarahgotit.

Icouldseethattheflushonhercheeksnowhadnothingtodowith

theworkshe’dbeendoingallday.

Icouldseethatherdark,intelligent,creativeeyeswererivetedon

mine,andthatthequestionswerebubblingwithinher.Shewasfeeling

excitementcontemplatingthecreationofanentrepreneurialbusiness.

Andsheknewshehadonealready.

ShecoulddoinherbusinesswhatRayKrochaddoneinhis.Allshe

neededtodowaslearnhow!

9WORKINGONYOURBUSINESS,NOTINIT

…formisonlyabeginning.Itisthecombinationoffeelingsanda

function;shapesandthingsthatcometooneinconnectionwith

thediscoveriesmadeasonegoesintothewoodthatpullit

togetherandgivemeaningtoform.

JamesKrenov

ACabinetmaker’sNotebook

ItiscriticalthatyouunderstandthepointI’mabouttomake.Forifyoudo,neitheryourbusinessnoryourlifewilleverbethesame.

Thepointis:yourbusinessisnotyourlife.

Yourbusinessandyourlifearetwototallyseparatethings.

Atitsbest,yourbusinessissomethingapartfromyou,ratherthana

partofyou,withitsownrulesanditsownpurposes.Anorganism,you

mightsay,thatwillliveordieaccordingtohowwellitperformsitssole

function:tofindandkeepcustomers.

Onceyourecognizethatthepurposeofyourlifeisnottoserveyour

business,butthattheprimarypurposeofyourbusinessistoserveyour

life,youcanthengotoworkonyourbusiness,ratherthaninit,withafull

understandingofwhyitisabsolutelynecessaryforyoutodoso.

ThisiswhereyoucanputthemodeloftheFranchisePrototypeto

workforyou.

Whereworkingonyourbusinessratherthaninyourbusinesswill

becomethecentralthemeofyourdailyactivity,theprimecatalystfor

everythingyoudofromthismomentforward.

Pretendthatthebusinessyouown—orwanttoown—istheprototype,

orwillbetheprototype,for5,000morejustlikeit.

Thatyourbusinessisgoingtoserveasthemodelfor5,000morejust

likeit.

Notalmostlikeit,butjustlikeit.Perfectreplicates.Clones.

Inotherwords,pretendthatyouaregoingtofranchiseyourbusiness.

(Note:Isaidpretend.I’mnotsayingthatyoushould.Thatisn’tthepoint

here—unless,ofcourse,youwantittobe.)

Further,nowthatyouknowwhatthegameis—thefranchisegame—

understandthattherearerulestofollowifyouaretowin:

1. Themodelwillprovideconsistentvaluetoyour

customers,employees,suppliers,andlenders,beyond

whattheyexpect.

2. Themodelwillbeoperatedbypeoplewiththelowest

possiblelevelofskill.

3. Themodelwillstandoutasaplaceofimpeccableorder.

4. AllworkinthemodelwillbedocumentedinOperations

Manuals.

5. Themodelwillprovideauniformlypredictableserviceto

thecustomer.

6. Themodelwillutilizeauniformcolor,dress,andfacilities

code.

Let’stakealookateachoftheserulesinturn.

1.TheModelWillProvideConsistentValuetoYour

Customers,Employees,Suppliers,andLenders,Beyond

WhatTheyExpect

Whatisvalue?

Howdoweunderstandit?Iwouldsuggestthatvalueiswhatpeople

perceiveittobe,andnothingmore.

SowhatcouldyourPrototypedothatwouldnotonlyprovide

consistentvaluetoyourcustomers,employees,suppliers,andlendersbut

wouldprovideitbeyondtheirwildestexpectations?

ThatisthequestioneveryEntrepreneurmustask.

Becauseitistheraisond’êtreofhisbusiness!

Itisintheunderstandingofvalue,asitimpactseverypersonwith

whomyourbusinesscomesintocontact,thateveryextraordinary

businesslives.

Valuecanbeawordsaidatthedoorofthebusinessasacustomer

leaves.

Valuecanbeanunexpectedgiftfromthebusinessarrivinginthe

mail.

Valuecanbeawordofrecognitiontoanewrecruitforajobwell

done,or,forthatmatter,toaseasonedsalespersonwho’sbeensuccessful

foryears.

Valuecanbethereasonablepriceofyourproducts,orthededication

youshowintheprocessofexplainingthemtoacustomerwhoneeds

morehelpthanusual.

Valuecanbeasimplewordofthankstoyourbankerforhis

conscientiousness.

Valueisessentialtoyourbusinessandtothesatisfactionyougetfrom

itasitgrows.

2.TheModelWillBeOperatedbyPeoplewiththeLowest

PossibleLevelofSkill

Yes,Isaidlowestpossiblelevelofskill.Becauseifyourmodel

dependsonhighlyskilledpeople,it’sgoingtobeimpossibletoreplicate.

Suchpeopleareatapremiuminthemarketplace.They’realsoexpensive,

thusraisingthepriceyouwillhavetochargeforyourproductorservice.

BylowestpossiblelevelofskillImeanthelowestpossiblelevel

necessarytofulfillthefunctionsforwhicheachisintended.Obviously,if

yoursisalegalfirm,youmusthaveattorneys.Ifyoursisamedicalfirm,

youmusthavephysicians.Butyoudon’tneedtohirebrilliantattorneys

orbrilliantphysicians.Youneedtocreatetheverybestsystemthrough

whichgoodattorneysandgoodphysicianscanbeleveragedtoproduce

exquisiteresults.

Thequestionyouneedtokeepaskingyourselfis:HowcanIgivemy

customertheresultshewantssystematicallyratherthanpersonally?Put

anotherway:HowcanIcreateabusinesswhoseresultsaresystems-

dependentratherthanpeople-dependent?Systems-dependentrather

thanexpert-dependent.

HowcanIcreateanexpertsystemratherthanhireone?

Thatisnottosaythatpeopleareunimportant.Onthecontrary,

peoplebringsystemstolife.

Peoplemakeitpossibleforthingsthataredesignedtoworkto

producetheintendedresults.And,intheprocess,peoplewhoaresystems

oriented—asallyourpeoplemustbe—learnhowtomoreeffectivelymake

thingsworkforyourcustomersandforyourbusinessbylearninghowto

improvethesystems.

It’sbeensaid,andIbelieveittobetrue,thatgreatbusinessesarenot

builtbyextraordinarypeoplebutbyordinarypeopledoingextraordinary

things.

Butforordinarypeopletodoextraordinarythings,asystem—“away

ofdoingthings”—isabsolutelyessentialinordertocompensateforthe

disparitybetweentheskillsyourpeoplehaveandtheskillsyourbusiness

needsifitistoproduceconsistentresults.

Inthiscontext,thesystembecomesthetoolsyourpeopleuseto

increasetheirproductivity,togetthejobdoneinthewayitneedstoget

doneinorderforyourbusinesstosuccessfullydifferentiateitselffrom

yourcompetition.

It’syourjob—moreaccurately,thejobofyourbusiness—todevelop

thosetoolsandtoteachyourpeoplehowtousethem.

It’syourpeople’sjobtousethetoolsyou’vedevelopedandto

recommendimprovementsbasedontheirexperiencewiththem.

There’sanotherreasonforthisrule—whatIcalltheRuleofOrdinary

People—thatsaystheblessingofordinarypeopleisthattheymakeyour

jobmoredifficult.

Thetypicalownerofasmallbusinessprefershighlyskilledpeople

becausehebelievestheymakehisjobeasier—hecansimplyleavethe

worktothem.

Thatis,thetypicalsmallbusinessownerprefersManagementby

AbdicationtoManagementbyDelegation.

Unfortunately,theinevitableresultofthiskindofthinkingisthatthe

businessalsogrowstodependonthewhimsandmoodsofitspeople.

Ifthey’reinthemood,thejobgetsdone.

Ifthey’renot,itdoesn’t.

Inthiskindofbusiness,abusinessthatreliesondiscretion,“Howdo

Imotivatemypeople?”becomestheconstantquestion.“HowdoIkeep

theminthemood?”

Itisliterallyimpossibletoproduceaconsistentresultinabusiness

thatdependsonextraordinarypeople.Nobusinesscandoitforlong.And

noextraordinarybusinesstriesto!

Becauseeveryextraordinarybusinessknowsthatwhenyou

intentionallybuildyourbusinessaroundtheskillsofordinarypeople,you

willbeforcedtoaskthedifficultquestionsabouthowtoproducearesult

withouttheextraordinaryones.

Youwillbeforcedtofindasystemthatleveragesyourordinary

peopletothepointwheretheycanproduceextraordinaryresultsover

andoveragain.

Youwillbeforcedtoinventinnovativesystemsolutionstothepeople

problemsthathaveplaguedsmallbusinesses(andbigbusinessesas

well!)sincethebeginningoftime.

Youwillbeforcedtobuildabusinessthatworks.

YouwillbeforcedtodotheworkofBusinessDevelopmentnotasa

replacementforpeopledevelopmentbutasitsnecessarycorrelate.

3.TheModelWillStandOutasaPlaceofImpeccableOrder

AtthecoreofRule#3istheirrepressiblefactthatinaworldofchaos,

mostpeoplecraveorder.Anditdoesn’ttakeageniustoseethattheworld

todayisinastateofmassivechaos.Wars,famine,crime,violence,

inflation,recession,ashiftingoftraditionalformsofsocialinteraction,

thethreatofnuclearproliferation,HIV,holocaustinallitshorrificforms

areallcommunicatedinstantlyandcontinuouslytothefixatedconsumer,

toallofuswatchingTV.

AsAlvinTofflerwroteinhisrevolutionarybook,TheThirdWave,“…

mostpeoplesurveyingtheworldaroundthemtodayseeonlychaos.They

sufferasenseofpersonalpowerlessnessandpointlessness.”Hewenton

tosaythat,“Individualsneedlifestructure.Alifelackingin

comprehensivestructureisanaimlesswreck.Theabsenceofstructure

breedsbreakdown.Structureprovidestherelativelyfixedpointsof

referenceweneed.”1

Itisthese“relativelyfixedpointsofreference”thatanorderly

businessprovidesitscustomeranditsemployeesinanotherwise

disorderlyworld.

Abusinessthatlooksorderlysaystoyourcustomerthatyourpeople

knowwhatthey’redoing.

Abusinessthatlooksorderlysaystoyourpeoplethatyouknowwhat

you’redoing.

Abusinessthatlooksorderlysaysthatwhiletheworldmaynotwork,

somethingscan.

Abusinessthatlooksorderlysaystoyourcustomerthathecantrust

intheresultdeliveredandassuresyourpeoplethattheycantrustintheir

futurewithyou.

Abusinessthatlooksorderlysaysthatthestructureisinplace.

4.AllWorkintheModelWillBeDocumentedinOperations

Manuals

Documentationsays,“Thisishowwedoithere.”

Withoutdocumentation,allroutinizedworkturnsintoexceptions.

Documentationprovidesyourpeoplewiththestructuretheyneed

andwithawrittenaccountofhowto“getthejobdone”inthemost

efficientandeffectiveway.Itcommunicatestothenewemployees,as

wellastotheold,thatthereisalogictotheworldinwhichtheyhave

chosentowork,thatthereisatechnologybywhichresultsareproduced.

Documentationisanaffirmationoforder.

AgainfromToffler:“…formanypeople,ajobiscrucial

psychologically,overandabovethepaycheck.Bymakingcleardemands

ontheirtimeandenergy,itprovidesanelementofstructurearound

whichtherestoftheirlivescanbeorganized.”2

Theoperativewordhereisclear.

Documentationprovidestheclaritystructureneedsifitistobe

meaningfultoyourpeople.

Throughdocumentation,structureisreducedtospecificmeansrather

thangeneralizedends,toaliteralandsimplifiedtaskTheTechnicianin

eachofusneedstounderstandtodothejobathand.

TheOperationsManual—therepositoryofthedocumentation—is

thereforebestdescribedasacompany’sHow-to-Do-ItGuide.

Itdesignatesthepurposeofthework,specifiesthestepsneededtobe

takenwhiledoingthatwork,andsummarizesthestandardsassociated

withboththeprocessandtheresult.

YourPrototypewouldnotbeamodelwithoutone.

5.TheModelWillProvideaUniformlyPredictableService

totheCustomer

Whilethebusinessmustlookorderly,itisnotsufficient;thebusiness

mustalsoactorderly.Itmustdothingsinapredictable,uniformway.

AnexperienceIhadnottoolongagoillustratesthepoint.

Iwenttoabarberwho,inourfirstmeeting,gavemeoneofthebest

haircutsIhadeverhad.Hewasamasterwiththescissorsandusedthem

exclusively,neverresortingtoelectricshearsassomanyothersdo.

Beforecuttingmyhair,heinsistedonwashingit,explainingthatthe

washingmadecuttingeasier.Duringthehaircut,oneofhisassistants

keptmycupofcoffeefresh.Inall,theexperiencewasdelightful,soI

madeanappointmenttoreturn.

WhenIreturned,however,everythinghadchanged.Insteadofusing

thescissorsexclusively,heusedtheshearsabout50percentofthetime.

Henotonlydidn’twashmyhairbutneverevenmentionedit.The

assistantdidbringmeacupofcoffee,butonlyonce,nevertoreturn.

Nonetheless,thehaircutwasagainexcellent.

Severalweekslater,Ireturnedforathirdappointment.Thistime,the

barberdidwashmyhair,butaftercuttingit,preliminarytoafinaltrim.

Thistimeheagainusedthescissorsexclusively,but,unlikethefirsttwo

times,nocoffeewasserved,althoughhedidaskifIwouldlikeaglassof

wine.AtfirstIthoughtitmightbetheassistant’sdayoff,butshesoon

appeared,busilyworkingwiththeinventorynearthefrontoftheshop.

AsIleft,somethinginmedecidednottogoback.Itcertainlywasn’t

thehaircut—hedidanexcellentjob.Itwasn’tthebarber.Hewas

pleasant,affable,seemedtoknowhisbusiness.Itwassomethingmore

essentialthanthat.

Therewasabsolutelynoconsistencytotheexperience.

Theexpectationscreatedatthefirstmeetingwereviolatedateach

subsequentvisit.Iwasn’tsurewhattoexpect.Andsomethinginme

wantedtobesure.IwantedanexperienceIcouldrepeatbymakingthe

choicetoreturn.

Theunpredictabilitysaidnothingaboutthebarber,otherthanthathe

wasconstantly—andarbitrarily—changingmyexperienceforme.Hewas

incontrolofmyexperience,notI.Andhedemonstratedlittlesensitivity

totheimpactofhisbehavioronme.Hewasrunningthebusinessfor

him,notforme.Andbydoingso,hewasdeprivingmeoftheexperience

ofmakingadecisiontopatronizehisbusinessformyownreasons,

whatevertheymighthavebeen.

Itdidn’tmatterwhatIwanted.

Itdidn’tmatterthatIenjoyedthesoundofthescissorsandsomehow

equatedthemwithaprofessionalhaircut.

Itdidn’tmatterthatIenjoyedbeingwaitedonbyhisassistant.

Itdidn’tmatterthatIenjoyedtheexperienceofhavingmyhair

washedbeforehesettoworkandthatIactuallybelieveditwould

improvethequalityofthehaircut.

Iwouldhavebeenembarrassedtoaskforthesethings,letaloneto

givemyreasonsforwantingthem.Theywereallsototallyemotional,so

illogical.HowcouldIhaveexplainedthem,orjustifiedthem,without

appearingtobeaboob?

Whatthebarberdidwastogivemeadelightfulexperienceandthen

takeitaway.

Itremindedmeofmyfirstpsychologycourseincollege.Irecallthe

professortalkingaboutthe“BurntChild”Syndrome.Thisiswhereachild

isalternatelypunishedandrewardedforthesamekindofbehavior.This

formofbehaviorinaparentcanbedisastroustothechild;henever

knowswhattoexpectorhowtoact.Itcanalsobedisastroustothe

customer.

The“BurntChild,”ofcourse,hasnochoicebuttostaywiththe

parent.Butthe“BurntCustomer”cangosomeplaceelse.Andhewill.

Whatyoudoinyourmodelisnotnearlyasimportantasdoingwhat

youdothesameway,eachandeverytime.

6.TheModelWillUtilizeaUniformColor,Dress,and

FacilitiesCode

Marketingstudiestellusthatallconsumersaremovedtoactbythe

colorsandshapestheyfindinthemarketplace.

Differentconsumergroupssimplyresponddifferentlytospecific

colorsandshapes.

Believeitornot,thecolorsandshapesofyourmodelcanmakeor

breakyourbusiness!

LouisCheskin,founderoftheColorResearchInstitute,wroteabout

thepowerofcolorsandshapesinhisbook,WhyPeopleBuy.

Littlethingsthataremeaninglessfromapracticalpointofviewmay

havegreatemotionalmeaningthroughtheirsymbolism.Imagesand

colorsareoftengreatmotivatingforces.

Sometimeagoweconductedastudyofwomenshoppinginan

apparelshop.Ayoungwomanwantedtobuyablousethatwas

availableinseveralcolors.Sheheldtheblueblouseuptoherfaceand

lookedintothemirror.Shewasablondeandsheknewshelookedgood

inblue.Shefingeredtheredonelovingly.Shelovedthecolor,she

thought,butshesaiditwastoostrongandloud.Thesalesgirlreminded

herthatyellowwasthefashionablecolor.Shecouldnotmakeupher

mindbetweenthecolorthatshelookedbestin,thecolorshelikedbest,

andthecolorincurrentfashion,soshesettledonagrayblouse.Itwas

reportedtomeacoupleofweekslaterthatshedidn’tlikethegray

blouse.“Itwasdead,”shesaid.Sheworeitonlytwice.

Someoftheotherpurchasersofblousespermittedoneoftheinner

drivestowin.Someboughtblousesbecausethecolorflatteredthem;

otherschosethecolorthatwasinfashionandsometookthecolorthey

liked.Eachchoseacolorthatsatisfiedthestrongesturgeorfulfilledthe

greatestwish.Justthink!Allthisdeeppsychologyinthemereprocessof

buyingablouse.3

YourbusinessisthesameastheblouseinCheskin’sstory.Thereare

colorsthatworkandcolorsthatdon’t.Thecolorsyoushowyour

customermustbescientificallydeterminedandthenusedthroughout

yourmodel—onthewalls,thefloors,theceiling,thevehicles,the

invoices,yourpeople’sclothes,thedisplays,thesigns.

Themodelmustbethoughtofasapackageforyouroneandonly

product—yourbusiness.

Justaswithcolors,thereareshapesthatworkandshapesthatdon’t,

onyourbusinesscard,yoursigns,yourlogo,yourmerchandisedisplays.

Inonetest,Cheskinshowedthatatriangleproducedfarfewersales

thanacircle,andacrestoutproducedbothbyasignificantmargin!

Imagine,salesincreasedorlostbythechoiceofaseemingly

meaninglessshape!

Theshapeofyoursign,yourlogo,thetypestyleusedonyourbusiness

cardswillhaveasignificantimpactonsaleswhetheryoucaretothink

aboutitornot!

YourPrototypemustbepackagedascarefullyasanyboxofcereal.

Beforewegoon,let’ssummarizewhatwe’vecoveredsofar.

Gotoworkonyourbusinessratherthaninit.

Gotoworkonyourbusinessasifitwerethepre-production

prototypeofamass-produceableproduct.

Thinkofyourbusinessassomethingapartfromyourself,asaworld

ofitsown,asaproductofyourefforts,asamachinedesignedtofulfilla

veryspecificneed,asamechanismforgivingyoumorelife,asasystemof

interconnectingparts,asapackageofcereal,asacanofbeans,as

somethingcreatedtosatisfyyourconsumers’deeplyheldperceived

needs,asaplacethatactsdistinctlydifferentfromallotherplaces,asa

solutiontosomebodyelse’sproblem.

Thinkofyourbusinessasanythingbutajob!

Gotoworkonyourbusinessratherthaninit,andaskyourselfthe

followingquestions:

HowcanIgetmybusinesstowork,butwithoutme?

HowcanIgetmypeopletowork,butwithoutmyconstant

interference?

HowcanIsystematizemybusinessinsuchawaythatit

couldbereplicated5,000times,sothe5,000thunitwould

runassmoothlyasthefirst?

HowcanIownmybusiness,andstillbefreeofit?

HowcanIspendmytimedoingtheworkIlovetodorather

thantheworkIhavetodo?

Ifyouaskyourselfthesequestions,you’lleventuallycomeface-to-face

withtherealproblem:thatyoudon’tknowtheanswers!

Andthat’sbeentheproblemallalong!

Butnowitshouldbedifferent.Becausenowyouknowthatyoudon’t

know.Nowyouarereadytolooktheproblemsquarelyintheface.

Theproblemisn’tyourbusiness;itneverhasbeen.

Theproblemisyou!

Ithasalwaysbeenyouandwillalwaysbeyou.Untilyouchange,that

is.

Untilyouchangeyourperspectiveaboutwhatabusinessisandhow

oneworks.

Untilyoubegintothinkaboutyourbusinessinatotallynewway.

Untilyouaccepttheundeniablefactthatbusiness,evenaverysmall

businesslikeyours,isbothanartandascience.

And,likeartandscience,tosuccessfullydevelopaseriousbusiness

youneedspecificinformation.

Mostimportantly,tosuccessfullydevelopaseriousbusinessyouneed

aprocess,apractice,bywhichtoobtainthatinformationand,once

obtained,amethodwithwhichtoputthatinformationtouseinyour

businessproductively.

Whatfollowsisjustsuchamethod.

Aprogrammedapproachtolearningwhatneedstobelearnedabout

yourbusinessinordertoclimbtheproverbialladder.

Aprovenwaytothetopthathasbeensuccessfullyimplementedby

thousandsofsmallbusinessesjustlikeyours.

WecallittheE-MythMasteryProgram.

Andit’saprocessthatcanchangeyourlife!

Sarahlookedatmethoughtfullyforamoment,andthensaid,“Letme

describeinmyownwordswhatIheardyoujustsay.”Shefoldedher

handstightlytogetherbeforeheronthetable,and,asifforemphasis,

leanedtowardme.

“Whatyou’resayingisthatI’mtooidentifiedwithmybusiness.ThatI

needtoseparatemyselffromit:firstinthewayIthinkaboutit,secondin

thewayIfeelaboutit,andthirdinthewayIworkinit.

“AndwhatIhearyousayingisthatitisthisidentificationwithmy

business,myTechnician’sneedtoseethebusinessasnothingmoreor

lessthanme,thatiscausingmeallthepainI’mfeeling,allthefrustration

Iexperiencegoingtoworkeveryday.Mybeliefthat,ifI’mgood,the

businesswillbe.ThatifIworkhardenough,thebusinesswillsucceed.

ThatifIamintouchwitheverythingthatgoesoninthebusiness,nothing

canpossiblygowrong.

“AndwhatIhearyousayingisthatinorderformetobefreeofmy

frustration,inordertoexercisetruecontrolovermybusiness,Ineedto

disidentifywithmybusiness.Ineedtoconceiveofmybusinessina

radicallydifferentlywaythanI’maccustomedto.Ineedtoconceiveofmy

businessasaproduct.Justlikemypiesareaproduct,Ineedtothinkof

mybusinesslikethat.AndifIweretothinkthatway,Iwouldsuddenly

havetoaskthequestion:Howmustmybusiness-as-a-productworkin

orderforittosuccessfullyattractnotonlycustomersbutalsoemployees

whowanttoworkthere?

“AndtheminuteIaskthatquestion,I’malreadydoingbusinessina

totallynewway!”

Sarahpausedforamoment,asiftoletthatlastthoughttrulysinkin.

“Youknow,”shesaidquietly,“Icantrulysaythatuntilthisvery

moment,Ihadneverthoughtaboutmybusinessasanideabefore.I

simplythoughtofitasajob.Aplacetogotowork.Inevereven

consideredtherewasanotherwaytothinkaboutit.Butnow!Nowit’s

gettingexciting.Anentirelynewopportunity.Thinkinglikethisreminds

meofmyfirstliteratureclassinhighschool.MyteacherwasMr.Roethke

andhehadanincredibleabilitytobringthesubjectofliteraturealive.By

thetimeIreadthefirstassignment—itwasHuckleberryFinn—Icouldn’t

putthebookdown.Thesewererealpeopleinthebook,livingouttheir

lives,inrealplaces,overcomingobstacles,terror,love,feelings.

HuckleberryFinncamealivetomeinthatfirstclasslikenobookhad

beforeit.

That’swhatthisfeelsliketome,likewe’reopeningthecoversofa

newbook,notknowingwhat’sinside,butknowing,giventhewonderful,

richanticipationthataccompanieseverynewadventure,thatnothingwill

everbethesameagain.That’showthisallfeelstome.Thatmybusiness

willneverbethesamefromthismomenton.AndneitherwillI!”

Shepressedherhandstogether,andthenleanedbackagainsther

chairasiftocatchabreath.

“And,ifIunderstandyoucorrectly,that’swhatyou’recallingthe

FranchisePrototype.TheFranchisePrototypeisthenameformy

business-as-a-product.It’sawayofthinkingaboutmybusinessasone

completething,awhole,youmightsay,thatlooks,acts,andfeelsina

clearlydefinableway,apartfromme.Independentofme.ThatifIdidall

thiscorrectly,AllAboutPiescouldbedesigned,engineered,and

manufacturedjustlikeanyproductis:tooperatepredictablyinsucha

waythatcauseseveryonetowanttobuyfromit,andbecauseitisso

predictablyresponsivetotheirneeds,theywouldkeeponcomingback

formore.Andit’smyjobtodesign,engineer,andmanufactureAllAbout

Piesuntilitworksperfectlywithoutmehavingtobethereallthetime.

“And,whileImustadmit,I’moverwhelmedbytheideaofit,it’sthe

mostchallengingandexcitingthoughtI’vehadinyears!

“Andthegreatthingis,I’vealreadygotthebusiness.AllIhavetodo

nowistolearnhow!”

“Sarah,”Isaid,“Icouldn’thavesaiditanybetter.So,let’sgoontothe

nextstep,theBusinessDevelopmentProcess.Becausewhatyouhaveto

learnisgoingtobeeasierthanyouthink.”

Formoreinformation,visitusatwww.e-myth.com

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3

PARTIII

BuildingaSmallBusinessThatWorks!

10THEBUSINESSDEVELOPMENTPROCESS

Toleranceforfailureisaveryspecificpartoftheexcellent

companyculture—andthatlessoncomesdirectlyfromthetop.

Championshavetomakelotsoftriesandconsequentlysuffer

somefailuresortheorganizationwon’tlearn.

ThomasJ.PetersandRobertH.WatermanJr.

InSearchofExcellence

BuildingthePrototypeofyourbusinessisacontinuousprocess,a

BusinessDevelopmentProcess.Itsfoundationisthreedistinctyet

thoroughlyintegratedactivitiesthroughwhichyourbusinesscanpursue

itsnaturalevolution.TheyareInnovation,Quantification,and

Orchestration.

Innovation

Innovationisoftenthoughtofascreativity.ButasHarvardProfessor

TheodoreLevittpointsout,thedifferencebetweencreativityand

Innovationisthedifferencebetweenthinkingaboutgettingthingsdone

intheworldandgettingthingsdone.SaysProfessorLevitt,“Creativity

thinksupnewthings.Innovationdoesnewthings.”1

TheFranchiseRevolutionhasbroughtwithitanapplicationof

InnovationthathasbeenalmostuniversallyignoredbyAmerican

business.Byrecognizingthatitisnotthecommoditythatdemands

Innovationbuttheprocessbywhichitissold,thefranchisoraimshis

innovativeenergiesatthewayinwhichhisbusinessdoesbusiness.

Tothefranchisor,theentireprocessbywhichthebusinessdoes

businessisamarketingtool,amechanismforfindingandkeeping

customers.Eachandeverycomponentofthebusinesssystemisameans

throughwhichthefranchisorcandifferentiatehisbusinessfromallother

businessesinthemindofhisconsumer.

Wherethebusinessistheproduct,howthebusinessinteractswith

theconsumerismoreimportantthanwhatitsells.

Andthehowdoesn’thavetobeexpensivetobeeffective.Infact,some

ofthemostpowerfulInnovationshaverequiredlittlemorethanthe

changeofafewwords,agesture,thecolorofclothing.

Forexample,whatdoesthesalespersoninaretailstoreinvariablysay

totheincomingcustomer?Hesays,“MayIhelpyou?”Haveyouever

heardthatonebefore?

Andhowdoesthecustomerinvariablyrespond?Hesays,“Nothanks,

justlooking.”Haveyoueversaidthatonebefore?

Ofcourseyouhave!

Infact,it’sauniversalphenomenon.

Nowwhydoyousupposethesalespersonasksthatquestionwhenhe

knowsthatthecustomerwillrespondthewayhedoes?

Becausethecustomerrespondsthewayhedoes,that’swhy!

Ifthecustomerisjustlooking,thesalespersondoesn’thavetogoto

work!

Canyouimaginewhatthosefewwordsarecostingretailersinthis

countryinlostsales?Here’saperfectopportunitytotryasimpleand

inexpensiveInnovation.

THEINNOVATIONInsteadofasking,“Hi,mayIhelpyou?”try

“Hi,haveyoubeeninherebefore?”Thecustomerwillrespondwith

eithera“yes”ora“no.”Ineithercase,youarethenfreetopursuethe

conversation.

Iftheanswerisyes,youcansay,“Great.We’vecreatedaspecialnew

programforpeoplewhohaveshoppedherebefore.Letmetakejusta

minutetotellyouaboutit.”

Iftheanswerisno,youcansay,“Great,we’vecreatedaspecialnew

programforpeoplewhohaven’tshoppedherebefore.Letmetakejusta

minutetotellyouaboutit.”

Ofcourse,you’llhavetohavecreatedaspecialnewprogramtotalk

aboutineithercase.Butthat’stheeasypart.

Justthink.Afewsimplewords.Nothingfancy.Buttheresultis

guaranteedtoputmoneyinyourpocket.Howmuch?Thatdependson

howenthusiasticallyyoudoit.Theexperienceofourretailclientstellsus

thatbydoingthisonethingalone,saleswillincreasebetween10and16

percentalmostimmediately!

Canyoubelieveit?Afewsimplewordsandsalesinstantlygoup.Not

byjustalittlebit,mindyou,butbyaconsiderableamount!Whatwould

youdofora10-to16-percentincreaseinsales?

THEINNOVATIONAgain,forsalespeople,asix-weektest.Forthe

firstthreeweeks,wearabrownsuittowork,astarchedtanshirt,abrown

tie(formen),andwell-polishedbrownshoes.Makecertainthatallthe

elementsofyoursuitarecleanandwell-pressed.Forthefollowingthree

weekswearanavybluesuit,agood,starchedwhiteshirt,atiewithredin

it(apinorascarfwithredinitforwomen),andhighlypolishedblack

shoes.

Theresultwillbedramatic:saleswillgoupduringthesecondthree-

weekperiod!Why?Because,asourclientshaveconsistentlydiscovered,

bluesuitsoutsellbrownsuits!Anditdoesn’tmatterwho’sinthem.

IsitanywonderthatMcDonald’s,FederalExpress,Disney,Mrs.

Field’sCookies,andmanymoreextraordinarycompaniesspendsomuch

timeandmoneyondetermininghowtheylook?Itpays!Anditpays

consistently,overandoverandoveragain.

THEINNOVATIONThenexttimeyouwantsomebodytodo

somethingforyou,touchhimsoftlyonthearmasyouaskhimtodoit.

Youwillbeamazedtofindthatmorepeoplewillrespondpositivelywhen

youtouchthemthanwhenyoudon’t.

Again,toapplythistoyourbusiness,youoryoursalespeopleshould

makeapointoftouchingeachcustomerontheelbow,arm,orbacksome

timeduringthesalesprocess.Youwillfind,asourclientshavefound,

thattherewillbeameasurableincreaseinsales.

Innovationistheheartofeveryexceptionalbusiness.Innovation

continuallyposesthequestion:Whatisstandinginthewayofmy

customergettingwhathewantsfrommybusiness?

FortheInnovationtobemeaningfulitmustalwaystakethe

customer’spointofview.Atthesametime,Innovationsimplifiesyour

businesstoitscriticalessentials.Itshouldmakethingseasierforyouand

yourpeopleintheoperationofyourbusiness;otherwiseit’snot

Innovationbutcomplication.

Innovation,then,isthemechanismthroughwhichyourbusiness

identifiesitselfinthemindofyourcustomerandestablishesits

individuality.Itistheresultofascientificallygeneratedandquantifiably

verifiedprofileofyourcustomer’sperceivedneedsandunconscious

expectations.

Itistheskilldevelopedwithinyourbusinessandyourpeoplethatis

constantlyasking,“Whatisthebestwaytodothis?”knowing,evenasthe

questionisasked,thatwewillneverdiscoverthebestway,butbyasking

wewillassuredlydiscoverawaythat’sbetterthantheoneweknownow.

Inthatregard,IthinkofInnovationasthe“BestWay”skill.It

producesahighlevelofenergyineverycompanywithinwhichit’s

nurtured,fed,andstimulated,energythatinturnfeedseveryonethe

companytouches—itsemployees,customers,suppliers,andlenders.In

aninnovativecompanyeveryonegrows.

There’snodoubtaboutit:Innovationisthesignatureofabold,

imaginativehand.

Quantification

Butonitsown,Innovationleadsnowhere.Tobeatalleffective,all

Innovationsneedtobequantified.WithoutQuantification,howwould

youknowwhethertheInnovationworked?

ByQuantification,I’mtalkingaboutthenumbersrelatedtothe

impactanInnovationmakes.

Forexample,askanygroupofsmallbusinessownershowmany

sellingopportunitiestheyhadthedaybefore(aswehaveatE-Myth

Worldwidedayafterday)andIpromiseyou99percentofthemwon’t

knowtheanswer.

ThesadfactisthatQuantificationisnotbeingdoneinmost

businesses.Andit’scostingthemafortune!

Forexample,howwouldyouknowthatbychangingthewordsyou

usetogreetanincomingcustomeryouproduceda16-percentincreasein

salesunlessyouquantifieditby(1)determininghowmanypeoplecame

inthedoorbeforetheInnovationwasputintoeffect;(2)determining

howmanypeopleboughtproductsandwhatthedollarvalueofthose

productswerebeforeyouchangedthewordsandwhatyousaidto

producethosesales;(3)countingthenumberofpeoplewhocameinthe

doorafteryouchangedthewords;(4)countingthenumberofpeople

whopurchasedsomething;(5)determiningtheaverageunitvalueofa

sale;and(6)determiningwhattheimprovementwasasaresultofyour

Innovation?Thesenumbersenableyoutodeterminetheprecisevalueof

yourInnovation.

Howwouldyouknowthatwearingabluesuithadaspecificmonetary

impactonyourbusinessunlessyouquantifiedthatimpactandhada

specificcontrolagainstwhichtomeasureit?Theanswerisobvious;you

wouldn’t.

AndasI’vesaid,fewsmallbusinessownersdoquantifythesethings,

eventhosewhobelieveinQuantification.

Becausefewsmallbusinessownersbelievethatsuchapparently

insignificantInnovationsarereallythatimportant!

Butaskyourself,ifyoucouldincreasesales10percentbydoing

somethingassimpleaswearingabluesuit,wouldyoudoit?Wouldyou

makeitimportant?Theanswerisasobviousasthequestionisridiculous.

Ofcourseyouwould!

AnditistheobviousthatmustbeaddressedbyQuantificationatthe

outsetoftheBusinessDevelopmentProcess.

Beginbyquantifyingeverythingrelatedtohowyoudobusiness.

Imeaneverything.

Howmanycustomersdoyouseeinpersoneachday?

Howmanyinthemorning?

Intheafternoon?

Howmanypeoplecallyourbusinesseachday?

Howmanycalltoaskforaprice?

Howmanywanttopurchasesomething?

HowmanyofproductXaresoldeachday?

Atwhattimeofthedayaretheysold?

Howmanyaresoldeachweek?

Whichdaysarebusiest?Howbusy?

Andsoforth.

Youcan’tasktoomanyquestionsaboutthenumbers.

Eventually,youandyourpeoplewillthinkofyourentirebusinessin

termsofthenumbers.

You’llquantifyeverything.

You’llbeabletoreadyourbusiness’shealthchartbytheflowofthe

numbers.

You’llknowwhichnumbersarecriticalandwhicharenot.

You’llbecomeasfamiliarwithyourbusiness’snumbersasyour

doctoriswithyourbloodpressureandpulserates.

Becausewithoutthenumbersyoucan’tpossiblyknowwhereyouare,

letalonewhereyou’regoing.Withthenumbers,yourbusinesswilltake

onatotallynewmeaning.

Itwillcomealivewithpossibilities.

Orchestration

Onceyouinnovateaprocessandquantifyitsimpactonyourbusiness,

onceyoufindsomethingthatworksbetterthanwhatprecededit,once

youdiscoverhowtoincreasethe“yeses”fromyourcustomers,your

employees,yoursuppliers,andyourlenders—atthatpoint,it’stimeto

orchestratethewholething.

Orchestrationistheeliminationofdiscretion,orchoice,atthe

operatinglevelofyourbusiness.

WithoutOrchestration,nothingcouldbeplanned,andnothing

anticipated—byyouoryourcustomer.Ifyou’redoingeverything

differentlyeachtimeyoudoit,ifeveryoneinyourcompanyisdoingitby

theirowndiscretion,theirownchoice,ratherthancreatingorder,you’re

creatingchaos.

AsTheodoreLevittsaysinhisstunningbook,MarketingforBusiness

Growth,“Discretionistheenemyoforder,standardization,and

quality.”2

“Ifabluesuitworks,weariteverysingletimeyou’reinfrontofa

customer,”isthedictumofthedisciplesofOrchestration.

“If‘Hi,haveyoubeeninherebefore?’worksbetterthananythingelse

you’vetried,sayiteverysingletimeyougreetacustomer,”istheruleof

thedayfromthedisciplesofOrchestration.

ByeverydiscipleofOrchestrationI’mreferringtoanyonewhohas

everseriouslydecidedtoproduceaconsistent,predictableresultinthe

worldofbusiness,nomatterwhatbusinesstheyarein.

WhetherthatbeFredSmithatFederalExpress,TomWatsonatIBM,

RayKrocatMcDonald’s,WaltDisneyatDisney,DebbieandRandyFields

atMrs.Fields’Cookies,orwhomever,throughoutthecourseoftime.

BecauseeveryfounderofeverygreatBusinessFormatFranchise

company,whetheritisfranchisedornot,knowsonethingtobetrue:if

youhaven’torchestratedit,youdon’townit!

Andifyoudon’townit,youcan’tdependonit.

Andifyoucan’tdependonit,youhaven’tgotafranchise.

Andwithoutafranchisenobusinesscanhopetosucceed.

If,byafranchise,youunderstandthatI’mtalkingaboutaproprietary

wayofdoingbusinessthatdifferentiatesyourbusinessfromeveryone

else’s.

Inshort,thedefinitionofafranchiseissimplyyouruniquewayof

doingbusiness.

Andunlessyouruniquewayofdoingbusinesscanbereplicatedevery

singletime,youdon’townit.Youhavelostit.Andonceyou’velostit,

you’reoutofbusiness!

TheneedforOrchestrationisbasedontheabsolutelyquantifiable

certaintythatpeoplewilldoonlyonethingpredictably—be

unpredictable.

Butforyourbusinesstobepredictable,yourpeoplemustbe.

Thenwhat?

Thenthesystemmustprovidethevehicletofacilitatepredictability.

Todowhat?

Togiveyourcustomerwhathewantseverysingletime.

Why?

Becauseunlessyourcustomergetseverythinghewantseverysingle

time,he’llgosomeplaceelsetogetit!

Orchestrationisthegluethatholdsyoufasttoyourcustomers’

perceptions.

Orchestrationisthecertaintythatisabsentfromeveryotherhuman

experience.Itistheorderandthelogicbehindthehumancravingfor

reason.

Orchestrationisassimpleasdoingwhatyoudo,sayingwhatyousay,

lookinglikeyoulook—beinghowandwhoyouare—foraslongasit

works.Foraslongasitproducestheresultsyouwant.

Andwhenitdoesn’tworkanylonger,changeit!

TheBusinessDevelopmentProcessisnotstatic.

It’snotsomethingyoudoandthenaredonewith.

It’ssomethingyoudoallthetime.

Inotherwords,onceyou’veinnovated,quantified,andorchestrated

somethinginyourbusiness,youmustcontinuetoinnovate,quantify,and

orchestrateit.

TheBusinessDevelopmentProcessisdynamic,simplybecausethe

world,movingasitdoes,willnottolerateastationaryobject.

Theworldwillcollidewithwhateveryou’vecreated,andsooneror

laterdestroyit.

TheBusinessDevelopmentProcessisthatwhichenablesyouto

preempttheworld’schanges.Ithopefullyprecedesthem,anticipates

them,and,ifnot,atleastisinfinitelyflexibleinrelationshiptothem.

Inshort,Innovation,Quantification,andOrchestrationarethe

backboneofeveryextraordinarybusiness.

TheyaretheessenceofyourBusinessDevelopmentProcess.

“Ineedyoutohelpmewithsomething,”Sarahsaid,alookofconcernon

herface.“Ineedhelpcomingtogripswiththiswholesubjectof

Orchestration.Itsoundssomechanical,sodeadening!WhenIthinkofit,

Ipictureashopfullofpeopleworkingdispassionately,eachofthem

doingthingsinidenticallythesameway,likerobots.Certainlyyoucan’t

besayingthat.ButIdon’tknowhowelsetothinkaboutit.”

Shepausedwithuncertainty,butthen,asthoughdecidingshehad

madeherpoint,grewquietandwaitedformyanswer.

“Sarah,”Ibegansoftly,“iftheBusinessDevelopmentProcesswere

onlyaboutOrchestration,Iwouldagreewithyou—itwouldbedeadly.

Absentahigherpurpose,allhabitsare.Becausethat’sallthat

Orchestrationreallyis,Sarah:ahabit.Awayofdoingsomething

habitually.

“Theproblemisyoucan’tunderstandthevalueofanentireprocess

byseparatingitfromitsparts,oritspartsfromtheprocess.Becauseonce

youseparatethepartsofaprocess,onceyoutakeaprocessapart,thereis

noprocess.Thereisnomovementwhatsoever.Thereisonlythisthingor

that.Thereisnobeginning,nomiddle,noend.Thereisnostory;there’s

onlyanevent,frozenintime.Youmightsaythatapartfromitsprocess,

thepartofaprocessisdead.SowhenyouthinkofOrchestrationabsent

InnovationandQuantification,you’redescribinganactionstrippedofits

purpose,itsmeaning,itsvitality.

“No,tofullyunderstandtheroleanyaction—oranypieceofwork—

playsinthebusinessasawhole,youhavetoseeitasapartofthewhole,

notasathinginitself.LetmeshowyouwhatImean.

“Thinkbacktoyouraunt’skitchen.Thinkabouttheprocessofbaking

apie.Certainlywhenyouremembertheentireprocessyouandyouraunt

wentthrough,youremembermuchmorethananysinglepartofit,isn’t

thattrue?”

Sarahsmiledwarmly,relivingtheexperienceinheraunt’skitchen.

“Yes,ofcoursethat’strue,”sheresponded.

“Itallmeltstogetherintoasensation,youmightsay.Intoapicture,

andsmells,andmovements,andthings,fusedtogetherwithmyaunt’s

remarksandherlaughterandherhandsdoingthethingstheydidonthe

cuttingboard.ExactlytheoppositeofwhatIimagineOrchestrationto

be,”shesaidfirmly.“Infact,that’swhatwassospecialtomeaboutthe

kitchen.Thecreativityofitall.Thecontinuousstreamofsurprises.”

“Butthinkaboutit,Sarah.Isthatreallytrue?Wasn’tthereaspecific

wayyouraunttaughtyoutocutthefruit?Aspecificwaytoholdit?A

specificwaytoprepareit?Wasn’tthereaspecificwaytodoeverything

youraunttaughtyoutodo?Andwasn’tthecreativity,thecontinuous

streamofsurprises,aresultnotjustofthespecificworkyouweredoing

butofyourcontinuousandexhilaratingexperienceofimprovingasyou

learnedhowtodothoseveryspecifictasksbetterandbetter,untilyou

coulddothemalmostaswellasyouraunt?

“Wasn’tthatwherethejoycamefrom?Thatifyouwereresignedto

doingonething,oneway,forever,withouteverimproving,therewould

benojoy—therewouldonlybethesamedeadeningroutine?Andisn’t

thatwhatyouraunttaughtyouasshetaughtyoutobakepies—the

mysterythatchangecanbring?

“So,ofcourse,thereneedstobeOrchestration,Sarah.Thereneedsto

beawaywedosomething.Thereneedstobeasetroutine.Because

withoutit,therewouldbenothingtoimproveupon.Andwithout

improvement,therewouldbenoreasontobe.Wewouldbemachines.

Or,asyoucalledthem,‘robots.’Therewouldbethetyrannyofroutine.

Therewouldbethemonotonyandtheboredomyousoeloquently

describe.

“Butwiththeprocess,withthecontinuousInnovationand

QuantificationthatprecedestheOrchestrationandthatfollowsit,with

thiscontinuousinvestigationintothewayofwork,theworkitself

becomeskeytoourownpersonaltransformation.Theworkitself

becomessomethingotherthanahabit;itbecomesanexplorationinto

whoweareandhowweexpressourselvesinrelationshiptosomething

muchlarger.First,thepositionwefill.Thenthefunctionitfills.Thenthe

businesswithinwhichthefunctionfulfillsbothitselfandthebusiness,

withoutwhichitwouldn’texist.Thentheworldwithinwhichthebusiness

fulfillsitspurposeaswellasthepurposeofthepeoplewithwhom,and

forwhom,itcomesintocontact.Andsoon,andsoforth.

“WhatI’vejustdescribedisthethrillofapprenticeship,thelearning

andgrowingthatyouexperiencedinthekitchenunderyouraunt’s

tutelage.

“That’sonelevelofexperience.Buttherearemore.

“Asecondkindofexperienceiswhenyoubegintodevelopacertain

levelofmasteryoftheorchestratedskillsyourauntintroducedyouto,

masterythatcomesfromyourpractice.That’sthemasteryofthe

craftsperson.

“Thecraftspersondevelopsaknowingnessabouttheworkshedoes

thatbearsitsownfruit,thefruitofbeingpresent,orattentive.The

craftspersonlearnsthatwithintheworkshedoesthereisajewelhiding

belowthesurface.Thatthethrillofthecraftistodiscoverthejewel.And

thatthereisonlyonewaytodiscoverit:topracticethecraftmindlessly.

Tobecomeonewiththework.Topolishandpolish,asthoughwithone’s

heart.Thatthereisnowaytoknowwhenthejewelwillshowitself,butto

trustwithallone’sheartthatoneday,whenitisleastexpected,thejewel

willbethere!Itwillappear.

“Andsothecraftspersonisonewhohasreachedthatstageofher

developmentwheresheiscontentwiththework,andonlythework,

knowingthatitisonlythroughbeingtherewithone’sworkthatthejewel

willrevealitself,andthatitisthework,andonlythework,raisedtothe

levelofnearperfectionthatconnectsthecraftspersonwithherself,with

herownheart.Andsoshepractices,dayinanddayout,contenttodoso,

withoutthethrilloftheapprenticetokeephergoing,butknowingdeep

insidethatthereisnoplacetogobuthere.

“Unliketheapprentice’sstage,thecraftsperson’sstageislongand

relativelysereneuntilthatdaywhenthejeweldoesappear,andwithita

stunningexplosionoflightenrapturesthecraftspersonandbringswithit

mastery.

“You’veseenmasterybefore,Sarah.You’veseenitinyouraunt’sface,

inhereyes,inthewayshespoketoyou.Forthemaster,thereisonlyone

wayandthatistoteachanother.Themasterisconnectedtothe

apprenticeasthoughtoherpast.Asyouaretoyourchildhood.The

masterknowsthattheprocessofgrowing,ofchange,oftransformation,

isalwaysmoving,neverstill.Itisinthefaceoftheapprenticethatthe

masterseesherselfanew.Itisinthefaceofthecraftspersonthatthe

masterrenewsherpilgrimageandfindsthebeautyofgivingherselfupto

work.Itisinthefaceoftheworkthatthemasterdiscoversanewwhyshe

issoenrapturedand,insodoing,bringsherrapturetotheapprenticeto

startalloveragain.

“Inmuchthesameway,Orchestrationbuildsuponthatwhich

precededit,andbecomesthefoundationforthatwhichisabouttofollow,

and,intheprocess,honorsthepast,thepresent,andthefuture.

“Tome,Sarah,thatiswhattheBusinessDevelopmentProcessisall

about;itisasearch,withinwhichtheveryordinarythingswemustdo

fromday-to-dayaretheessentialhubofthewheelaroundwhichthe

searchmoves.

“Onamorepracticallevel,whatwe’veexperiencedinourworkwith

smallbusinessesisthat,astheBusinessDevelopmentProcessbecomes

anintegralpartofthebusiness,italsobecomesanintegralpartofthe

communicationbetweentheparticipants.Itbecomesnotonlyawayof

thinkingandawayofdoingbutawayofbeingaswell.Youmightsay

that,whilegoingtoworkonthebusiness,peoplebegintorealizethatitis

apowerfulmetaphorforgoingtoworkontheirlives.

“Andthat,Ibelieve,istheheartoftheprocess:notefficiency,not

effectiveness,notmoremoney,notto‘downsize’or‘getlean,’butto

simplyandfinallycreatemorelifeforeveryonewhocomesintocontact

withthebusiness,butmostofall,foryou,thepersonwhoownsit.

“So,Iobviouslyfeelpassionatelyaboutthesubject.Whatyoucallit

doesn’treallymatter;callittheBusinessDevelopmentProcess,

Reengineering,TQM,Excellence,orKaizen—theentiresubjectbecomesa

desultoryprocessifitdoesn’taddresstheheartsandmindsandsoulsof

people.

“Qualityisjustaword,andanemptywordatthat,ifitdoesn’t

includeharmony,balance,passion,intention,attention.

“Continuousimprovementforitsownsakeisawasteoftime.

“Lifeiswhatabusinessisabout,andlifeiswhatthisworkisabout.

Comingtogripswithoneself,inthefaceofanincrediblycomplexworld

thatcanteachusifwe’reopentolearn.

“Inthisway,theBusinessDevelopmentProcesscanbethoughtofasa

metaphorforpersonaltransformation,forcomingtogripswithreallife.

“Fordevelopingrealskillswithinastructureofyourowndesign.

“Forunderstandingthedynamicsofchange,ofvalue,of

communication,ofthought.

“It’sanidea.AnideathatweatE-MythWorldwidehavelearnedto

manifestinthepracticalworld.Itisaphilosophy.Itisacosmology.Itis

whateveryouwishittobe.

“Butwhatitis,intheend,isanopportunitytofulfillwhateveris

fulfillableintheplaceyoufindyourselfnow,andinanyfutureplaceyou

couldoccupywithenoughimaginationandenoughofawish.”

IsuddenlybecameawarethatIhadbeengoingonwithoutchecking

inwithSarah.I’vebeenknowntodothatattimes.

“I’msorry,Sarah.Igotcarriedawaywiththeideaandthesoundof

myownvoice.Doyouhaveanyquestions?CanIbemorespecific?”

Sarahtouchedmyhandsonthetable,andsaid,“Myheadisfullof

questions,butsomehowIthinkyou’regoingtoanswerthem.Ijustwant

tothankyoufordoingwhatyoujustdid.Ifyoudon’tmind,couldwego

onandtalkabouthowallthisworks?”

Itookasipoftea,andwenton.

1

2

11YOURBUSINESSDEVELOPMENT

PROGRAMAndIsaytoyeall,goodfriends,thatasyegrowingolf,yecometo

seethethingsyelearnthereineveryotherplace.Thegracethat

comesfromsuchadiscipline,theextrafeelinthehands,theextra

strengthandknowin’,allthosespecialpowersye’vefeltfromtime

totime,begintoenterourlives.

MichaelMurphy

GolfintheKingdom

Nowyouunderstandthetaskahead:tothinkofyourbusinessasthough

itweretheprototypefor5,000morejustlikeit.

Toimaginethatsomeonewillwalkthroughyourdoorwiththe

intentionofbuyingyourbusiness—butonlyifitworks.

Andonlyifitworkswithoutalotofworkandwithoutyoutoworkit.

Imagineyourselfatthatmoment.Imagineyoursmileinsideasyou

say,“Letmeshowyouhowitworks,”knowingthatnotonlywillitwork

butitwillworkbetterthananybusinesshe’severseen.

Imagineyourselftakingthepotentialbuyerthroughyourbusiness,

explainingeachcomponentandhowitworkswitheveryother

component.

Howyou’veinnovatedsystemssolutionstopeopleproblems,how

you’vequantifiedtheresultsofthoseinnovations,andhowyou’ve

orchestratedtheinnovationssothattheyproducethesameresultsevery

singletime.

Imagineyourselfintroducingthepotentialbuyerofyourbusinessto

yourpeople,andstandingbywhiletheyproudlyexplaintheir

accountabilitiestothefascinatedstranger.

Imaginehowimpressedthepotentialbuyerofyourbusinesswouldbe

uponbeingpresentedwithsuchorder,suchpredictability,such

irreproachablecontrol.

ImaginetheresultsofyourBusinessDevelopmentProgram.

YourBusinessDevelopmentProgramisthestep-by-stepprocess

throughwhichyouconvertyourexistingbusiness—ortheoneyou’re

abouttocreate—intoaperfectlyorganizedmodelforthousandsmorejust

likeit.

YourBusinessDevelopmentProgramisthevehiclethroughwhich

youcancreateyourFranchisePrototype.

TheProgramiscomposedofsevendistinctsteps:

1. YourPrimaryAim

2. YourStrategicObjective

3. YourOrganizationalStrategy

4. YourManagementStrategy

5. YourPeopleStrategy

6. YourMarketingStrategy

7. YourSystemsStrategy

Let’sgetstarted.

12YOURPRIMARYAIM

Thechiefcharacteristicofthevolitionalactistheexistenceofa

purposetobeachieved;theclearvisionofanaim.

RobertAssagioli

TheActofWill

Idoubtthatbynowyou’dbesurprisedtofindoutthatIdon’tbelieveyourbusinesstobethefirstorderofbusinessonouragenda.

Youare.

NorwillyoubesurprisedtohearthatIdon’tbelieveyourbusinessis

yourlife,thoughitdoesandcanplayasignificantlyimportantrolein

yourlife.

Butbeforeyoucandeterminewhatthatrolewillbe,youmustask

yourselfthesequestions:WhatdoIvaluemost?WhatkindoflifedoI

want?WhatdoIwantmylifetolooklike,tofeellike?WhodoIwishto

be?

YourPrimaryAimistheanswertoallthesequestions.

Consideritfromanotherperspective.

I’dlikeyoutoimaginethatyouareabouttoattendoneofthemost

importantoccasionsofyourlife.

Itwillbeheldinaroomsufficientlylargetoseatallofyourfriends,

yourfamily,yourbusinessassociates—anyoneandeveryonetowhomyou

areimportantandwhoisimportanttoyou.

Canyouseeit?

Thewallsaredrapedwithdeepgoldentapestries.Thelightingis

subdued,soft,castingawarmglowonthefacesofyourexpectantguests.

Theirchairsarehandsomelyupholsteredinagoldenfabricthatmatches

thetapestries.Thegoldencarpetingisdeeplypiled.

Atthefrontoftheroomisadais,andonthedaisalarge,beautifully

decoratedtable,withcandlesburningateitherend.

Onthetable,inthecenter,istheobjectofeveryone’sattention.A

large,shining,ornatebox.Andintheboxis…you!Stiffastheproverbial

board.

Doyouseeyourselflyinginthebox,notadryeyeintheroom?

Now,listen.

Fromthefourcornersoftheroomcomesataperecordingofyour

voice.Canyouhearit?You’readdressingyourguests.You’retellingthem

thestoryofyourlife.

Howwouldyoulikethatstorytogo?

That’syourPrimaryAim.

Whatwouldyouliketobeabletosayaboutyourlifeafterit’stoolate

todoanythingaboutit?

That’syourPrimaryAim.

Ifyouweretowriteascriptforthetapetobeplayedforthemourners

atyourfuneral,howwouldyoulikeittoread?

That’syourPrimaryAim.

Andonceyou’vecreatedthescript,allyouneedtodoismakeitcome

true.

Allyouneedtodoisbeginlivingyourlifeasifitwereimportant.

Allyouneedtodoistakeyourlifeseriously.

Tocreateitintentionally.

Toactivelymakeyourlifeintothelifeyouwishittobe.

Simple?Yes.

Easy?No.

Butabsolutelyessentialifyourbusinessistohaveanymeaning

beyondwork.

Becauseifyourbusinessisgoingtobecomeanintegralpartofthat

tape,ifyourbusinessisgoingtomakeamajorcontributiontothe

realizationofyourdream,ifyourbusinessisgoingtobecomea

significantcomponentofyourPrimaryAim,youhavetoletyourbusiness

knowwhatthatAimis!

Andhowcanyouexpecttodothat,ifyoudon’tknowwhatitis?

DoyouseewhyyourPrimaryAimissoimportanttothesuccessof

yourbusiness?

Withnoclearpictureofhowyouwishyourlifetobe,howonearth

canyoubegintoliveit?

Howwouldyouknowwhatfirststeptotake?

Howwouldyoumeasureyourprogress?

Howwouldyouknowwhereyouwere?

Howwouldyouknowhowfaryouhadgone?

Howwouldyouknowhowmuchfartheryouhadyettogo?

WithoutyourPrimaryAim,youwouldn’t.Indeed,youcouldn’t.It

wouldbevirtuallyimpossible.

AswithMaturecompanies,Ibelievegreatpeopletobethosewho

knowhowtheygotwheretheyare,andwhattheyneedtodotogetwhere

they’regoing.

Greatpeoplehaveavisionoftheirlivesthattheypracticeemulating

eachandeveryday.

Theygotoworkontheirlives,notjustintheirlives.

Theirlivesarespentlivingoutthevisiontheyhaveoftheirfuture,in

thepresent.Theycomparewhatthey’vedonewithwhattheyintendedto

do.Andwherethere’sadisparitybetweenthetwo,theydon’twaitvery

longtomakeupthedifference.

Theygotoworkontheirlives,notjustintheirlives.

Ibelieveit’struethatthedifferencebetweengreatpeopleand

everyoneelseisthatgreatpeoplecreatetheirlivesactively,while

everyoneelseiscreatedbytheirlives,passivelywaitingtoseewherelife

takesthemnext.

Thedifferencebetweenthetwoisthedifferencebetweenlivingfully

andjustexisting.

Thedifferencebetweenthetwoislivingintentionallyandlivingby

accident.

LetmerepeatoncemorethatgreatquotebyDonJuaninCarlos

Castaneda’sASeparatePeace:“Thedifferencebetweenawarriorandan

ordinarymanisthatawarriorseeseverythingasachallenge,whilean

ordinarymanseeseverythingaseitherablessingoracurse.”

Sobeforeyoustartyourbusiness,orbeforeyoureturntoittomorrow,

askyourselfthefollowingquestions:

WhatdoIwishmylifetolooklike?

HowdoIwishmylifetobeonaday-to-daybasis?

WhatwouldIliketobeabletosayItrulyknowinmylife,

aboutmylife?

HowwouldIliketobewithotherpeopleinmylife—my

family,myfriends,mybusinessassociates,mycustomers,

myemployees,mycommunity?

HowwouldIlikepeopletothinkaboutme?

WhatwouldIliketobedoingtwoyearsfromnow?Ten

yearsfromnow?Twentyyearsfromnow?Whenmylife

comestoaclose?

WhatspecificallywouldIliketolearnduringmylife—

spiritually,physically,financially,technically,

intellectually?Aboutrelationships?

HowmuchmoneywillIneedtodothethingsIwishtodo?

BywhenwillIneedit?

Thesearejustafewofthequestionsyoumightaskyourselfinthe

creationofyourPrimaryAim.

Theanswersbecomethestandardsagainstwhichyoucanbeginto

measureyourlife’sprogress.Intheabsenceofsuchstandards,yourlife

willdriftaimlessly,withoutpurpose,withoutmeaning.

Inthatregard,yourPrimaryAimisthevisionnecessarytobringyour

businesstolifeandyourlifetoyourbusiness.

Itprovidesyouwithapurpose.

Itprovidesyouwithenergy.

Itprovidesyouwiththegristforyourday-to-daymill.

“That’swhat’sbeenmissinginmybusiness,”Sarahallbutshouted.“Me!

HowcouldIhavebeensooblivioustosomethingsoobvious?”

“Don’tbesohardonyourself,”Isaid.“Wearealloblivious.Jointhe

club.Letmetellyouastory.

“Therewasonceayoungmanwhohadrecentlyturnedfortywhose

lifeseemedtobegoingnowhere.Somehowhehadnevergrabbedholdof

acareer.Hislifehadnopurpose.Collegehadsomehoweludedhim.In

hisfirstyearatUCLA,hecouldn’tfindanythingtoholdhisattentionand

hequit.Hestudiedmusic—manysaidbrilliantly—asaboy,butinhis

earlyadultyearsfailedtofindtheconvictionheneededtopursueit.

“Manydifferentthingsattractedhim—music,religion,mysticism,

writingpoetry,drugs,writingpulpfiction,money—noneofthem

permanently.Hetookwhateverjobscamealong,and,becauseofhis

naturalandvariedtalents,hedidwhateverhedidwell,buteventhen

noneofthejobsturnedintoanythingwithafuture,atleastnotafuture

thatattractedhim.Afterleavingcollegeatmidterm,hedrovetoNew

YorkCitytostudyart,quicklychangedhismind,andjoinedtheArmy,

whichsenthimtoKorea.Hisfatherdiedsuddenly,bringinghimhometo

careforhismotherandtwoyoungersiblings.

“Sometimeafter,hemetanexcitingwoman,tookofftoEurope

wheretheytraveledfromcountrytocountryonamotorscooter,and

whereheplayedsaxophoneanddrewreligiousfiguresonthestreetsin

frontofcathedralstoearnenoughmoneytoeat.Finallyoutofmoneyand

tiredofthegame,heandhiswomanfriendwererepatriatedbytheU.S.

governmentandreturnedtoNewYorkCitywheretheycontractedto

driveaNewYorkCityyellowcabtoL.A.todeliverittoitsnewowner.

“Whenhewastwenty-five,theymarried,hadtwochildren,movedto

SanFrancisco,wheretheyoungmansoldencyclopediasforaliving,

playedsaxophoneonoccasion,andbecameovertimelessyoung.Their

lifewasarunningbattle.Eventually,afteronetoomanyragesabouthis

wife’sabuseofalcohol,herinfidelity,andhislackofpurpose,thewhole

thingcametumblingdownintodivorce.

“Heimmediatelymetamuchyoungerwoman,whoseeyesshinedlike

hisex-wife’sdidn’t,whoreadhispoetryandwastouchedbyit,who

listenedtohismusicandwasawedbyit,wassatisfiedjusttositbyhis

side,noquestionsasked.Andthoughhecontinuedtosellencyclopedias,

andthoughhisheartfeltneedforconnectingwithsomethingthat

smackedofpurposecontinuedtopainhimprivatelythroughoutallof

this,hislifetookamorepositiveturnwiththisnewyoungwomanwho

eventuallybecamehissecondwife.

“Hewentbacktocollege,leftthebookbusiness,studiedcontracting

andconstructionsohecouldworkwithhishandsratherthanhismouth,

movedwithhisnew,willingwifetosouthernCalifornia,andmaneuvered

himselfintoframingjobsfromwhichhewasfiredtimeaftertimeuntilhe

learnedhowtopullitoff.

“Bythistime,hewasamaninhislatethirtiesbeginningtodowork

thatkidstwentyyearsyoungerthanhimdid.Theyregardedhimonthe

jobassomethingofafreak.Hisbeardbynowwasdowntohischest,his

hairhungdownoverhisshoulders;hewrotepoetryatnight,playedjazz

ontheweekend,ateburritoswiththeMexicansonthejob,smokeddope

intheevenings,anddreamedcrazilyaboutthefuturewhenheandhis

youngwifewouldbuytwentyacresinMendocinoCounty,buildtheirown

housewiththeirownhands,raiseafamily,andhavehistwogirlsfrom

hisfirstmarriagemoveinwiththemwheneverythingwasready.

“Theyhadatinyone-bedroomhouseinSantaAna,California,drovea

’52Chevypickup,andalongwiththeirGreatDanenamedDanandalittle

blackpoodlenamedMurray,theylivedinasense-steamingdazethat

seemedatthetimeclosetowhattheperfectlifemustbelike.

“But,aswithallgoodthings,thistoocametoanend,whenouryoung

man,turningolder,pursuedbythedemonsofsomeindefinablemuse,

decidedtomovebacknorth,nowthattheyhadtheiracttogether,saved

upenoughfromlivingtherightlife,handscrustedandgnarlyfrom

‘honest’work,bodybrownandbeautifulfromputtinghismusclesonthe

line,brainfilledwiththepoetryhehadwritten,themusichehad

renewed,andthedopehehadsmoked,knowingthatitwastimeto

becomethecontractorhehadsetouttobecomethreeyearsbefore,and

thatallitwouldtakewasonesizablekicktogetthemmovingtoward

whatheknewwouldbethefineresolutionofhisup-to-nowraggedy

search.

“HeandhiswifeandhisGreatDane,Dan,andhispoodlenamed

Murray,pluswhateverelsetheyhadaccumulatedinthefewyearshe

spentworkingwithhishandsratherthanhismouthinsouthern

California,pileditallupinthe’52Chevypickupandmovedbacktothe

SanFranciscotheyhadcomefromnotthatlongbefore.

“Itwasthenthatthebigshifttookplaceandtheunpredictable

happened.Ournowthirty-eighty-year-oldheroandhisyoungwife,along

withthedogsandthepickup,wereinvitedtomoveintemporarilywith

hissisterandherhusbandwhilenegotiatingthepurchaseoftheir

‘MendocinoAcres.’Hisbrother-in-lawhadtheideathatourherowould

dowellconsulting—intheareainwhichhewasatestedexpert,sales—

withhisadvertisingagency’shi-techsmallbusinessclients,untilsuch

time,ofcourse,thatourherosettleddownwithhisyoungbrideontheir

‘MendocinoAcres’tofollowhistruecalling.

“Understand,everyoneknewthatthatwasgoingtohappen.Nobody

doubtedit.Fulloftherobustidealismthathadmarkedhisyouthful

passing,hewas,withoutanydoubtwhatsoever,goingtorealizehis

vision;thetwentyacreswereallbuthis—itsimplyrequiredthedoing.Of

course,therewasalsothecontractor’slicenseandthemoney,butnoone

thoughtthatanyofthatwouldproveinsurmountable.

“Afterall,herewasamanwhohadlivedalifethatbaffledgood

reason.Whateverhechosetodo,hedid.Whateverhedid,hewasgood

at.Nomatterthatoncehedidit,hegrewtiredofit.Hechosetodothat,

too.Tohisfriendsandhisfamilyhewas,ifnotunexplainable,certainly

someonetobenoticed,attimesinamazement,andattimeswithpity;

but,neverwithoutawe,becausewhoknewwhatthismanwasgoingtodo

next?Andsomehow,theyall,intheirownprivateway,enviedhim!Can

youbelievethat?Theyenviedhimbecauseheseemedsofree!Despitethe

perpetualtroublehefoundhimselfin.Despitehislackofdirection.

Despitehiswhimsicalandsometimesdangerousphilosophy,therewas

nodenyingit,thisman,althoughgettingolder,sometimesprecipitously,

waslivingaromanticadventuretheywritemoviesabout,or,ifnotthat,a

pitifultragedy.

“Byanyone’sstandards,hewaslivingprettyclosetotheedge.Here’s

aguyonthecuspofmiddleagewithalongbeard,ayoungwife,twodogs,

andapickup,withoutahomeoftheirown,livingwithfamily,searching

forpropertytheycouldn’tpossiblyafford,withhardlyathoughtinhis

headthatanythingwaswrongatallwiththispicture,abouttostepon

thosemovingstairstosomewherethathewastotallyunpreparedfor.

“Andtakethestephedid.Anditwasastunner!Hewas,thankstohis

brother-in-law’sgoodintentions,suddenlysetadriftinaworldthatcould

havebeenanotherplanetforallheknew.InSiliconValley.Callingon

techieswhoownedbusinesseswhosenameshecouldn’tevenpronounce

atfirstattempt,makingstuffhedidn’tevenknowexisted.Hewas

dumbfoundedbythemagnitudeofhisignorance.Andyet,something

calledhimtostay.Theyaskedhim,‘Howcanyouhelpme?’Heanswered,

‘Idon’tknow.’Theyaskedhim,‘Whatdoyouknowaboutmybusiness?’

Heanswered,‘Nothing.’Theylookedathimforalongtime.Hesatand

lookedback,andjustthought.Theysaidtohim,‘Whydon’tyoucome

backafteryou’vehadsometimetothinkaboutit.’Hesaidhewould.And

hedid.Becauseheknewsomethingwasthere.

“Understand,here’saguywhohadbeensellingencyclopediasto

peopleatnight,infrontoftheirtelevisionsets,oronthediningroom

table.Watchingtheirfacessuspiciouslyregardhimassomeonewhocame

outofthenight,untilhespreadouttheencyclopediaandthevividly

coloredpanelsthatshowedallthebooksgraphicallyalive:themaps,the

transparenciesofthehumanbody,theendlesslistoftopics,ofwonders

theworldwithheldfromthemintheirordinarylives,thepromisetotheir

children,eventheirchildrentocome,ofeducation,ofknowledge,of

information,longbeforetheInformationAgehadarrived.

“Heretheireyeswouldawakenandlightenuptoallthesecolorful

picturesofwhatwaspossible,andnow,almostwithintheirreach,

pendingadecision.Hehaddonethatlateatnight,grindingawayinfront

ofFrankandMargeuntilfinallyFrank,withhislastbreath,wouldsay

sortofcovertly,‘Well,Marge,whad’yathink?Thinkweshoulddoit?’And

hewouldsitthere,ourthirty-somethinghero,waitingwithouta

movement,withoutawhisperofencouragementtoMarge,letaloneto

Frank,waitingfortheinevitable‘yes’or‘no,’eitherofwhichwouldturn

himbackoutintothenightto,ifhewaslucky,goanotherround,atBen

andMary’s,withallthelittlekidshangingonthepicturesandmaking

messesonhislaminatedplates.

“Tothisguy,thisworld,thisSiliconValley,wasamiracle!‘AndIget

todothisduringtheday?!’Andso,visitthemhewould.Allthewhile

feelingstupid,knowingnothingabouttheirworld,ortheirbusiness,or

thelittleweirdthingstheymadethere,thelittleblackboxeswiththeir

arcanesignificancesofarbeyondhisexperienceofcoffeetablesand

poetryandmusicandframingandpitchingandclosing,thisintricate

littleworldoftheirsthatlivedinsomecubicleinsideoftheirforeign,

tight,screwylittlebrains.Andyet,intuitively,heknewthatheknew

somethingthattheyneeded.Heknewthattherewassomethingwaiting

thereforhim,somethinghispeculiarlifehad—insomestrange,

inexplicableway—preparedhimfor,somethingonlysomeonewhohad

livedinsuchanunconscious,cataclysmic,totallydisorganized,yetalways

passionatestate,doingthisandthat,couldfullyappreciate.

“Anditwasthenthatthecurtainlifted.Thecurtainbetweentheworld

thatwastheirsandtheworldthatwashis.Butmostofall,thecurtain

thatstoodbetweenhimselfandhimself,thecurtainthatseparatedhim

fromhislife.

“Itwasthenthatherealizedwithasuddennessthatmadehimgiddy

that,whilehedidn’tunderstandtheirbusiness,neitherdidthey!Andin

thatoneshudderinginstantoftruthourherowasreborn.Hediscovered

anentirelynewlife.

“Andwiththediscoveryofhisnewlife,therecamefortheveryfirst

timeinhislifethebeginningofsomepurpose:toneverletthecurtain

downagain,toneverallowthecurtaintocoverwhatwashidingthere

behindit.Thattheworldwasnothinglikehehadbelievedittobe.That

nooneknewwhathehadbelievedtheyknew.Thateverythingwasjust

likehehadthoughtitwas,amystery,butthathewasn’ttheonlyonewho

didn’tknowwhatwasgoingon.WhathelearnedinSiliconValleyisthat

nooneknewwhatwasgoingon!Itwascompletelyopentointerpretation.

Andhisguesswasasgoodasanyone’s.MyGod,probablyevenbetter.

“Afterall,hehadmetFrankandMargeface-to-face.Hehadsurvived

theworstoftheworstconfrontations.Hehadevenbeenattackedbya

Germanshepherddogwhilehewasattemptingtomakehisfinalclose.

Rightacrossthekitchentable!WhoinSiliconValleycouldsaythat?And

livetotellaboutit.Yo,andhehadevenmadethesale!Walkedoutwitha

torncontractinhandandacheck.Whosaidlittleblackboxeswere

dangerous?Whosaidtherewasanythingtofear,anythinghecouldn’t

understand?”

IstoppedlongenoughtofeelhowmuchthisstoryhadtouchedSarah

andhowmuchshewantedtoasktheobviousquestion,butIhadto

finish,soIwenton.

“Andsothatchapterofourhero’slifewasclosedandanewchapter

opened.Hemovedintohisearlyfortiesandtheendofhissecond

marriage,whichalso,bythistime,hadproducedachild—histhird

daughter—anotherloveofhislifewhocouldnot,asnochildcaneverdo,

repairabrokenmarriage.Duringtheyearsthatfollowed,hebecame

aboutthebestanyonecouldbeinhisnowchosenprofession.Helearned

thesecretshethoughtwerehidden.Hemarriedawomanfarbiggerthan

theothers,hadtwomorechildren,foughtbattleswithhisignoranceat

timestitanicinscope,movedthroughoneobstacleafteranother,wrote

books,spokethroughouttheworld,builtagreatbusiness,onlytowatchit

almostfail,persistedinbuildingitupagain,lanced,jabbed,wrestled,

grappled,laughed,sang,loved,androared,andthroughitall,

rememberedonesimplethingthatmeantmoretohimthananythingelse

hehadeverthought:thecurtain,thecurtain.Keepthecurtainupatall

cost.

“Becauseitisthecurtainthatkepthimshroudedindarkness.Andit’s

thedarknessthatholdsoutthelight.Itisthelight,theopenness,the

clearingofalltheobstaclestoknowingthathadbecomehistruepurpose:

tobeopen.Tobeawake,tobeavailabletowhat’sreallygoingon,togive

upfalsebeliefs.

“Andforonlyonereason:hislifewasatstake!

“Andthat’sthepoint,Sarah.

“It’snotyourbusinessyouhavetofearlosing.It’ssomethingmuch

biggerthanthat.It’syourSelf.

“Andthat’swhatthiswholethingisabout.

“Whattruthsareyourcurtainhidingfromyou?What

misunderstandingkeepsyouwhereyouare,inthepast,inthedark,

shroudedinyourlimitedbeliefs,shrinkingfromtheworld,fromthelight

ontheothersideofthecurtain?

“Untilyouliftthecurtain,Sarah,untilyoudaretopullthemaskoff

theworld’sface,untilyoumovebeyondyourComfortZone,youwill

neverknowwhatitisyouweremissingoutthere.

“It’syou,Sarah.It’syouthat’swaitingoutthereforyoutofindonthe

othersideofthecurtain.

“Iknow,Sarah,becausethemanI’vebeentellingyouaboutisme.

Whenthecurtainlifted,Ilearnedsomething.

“Thatthere’snooneelseouttherebutyou!”

13YOURSTRATEGICOBJECTIVE

‘Yourarrowsdonotcarry,’observedtheMaster,‘becausetheydo

notreachfarenoughspiritually.’

EugenHerrigel

ZenandtheArtofArchery

Onceyouhaveapictureofhowyouwantyourlifetobe,andyoucome

totherealizationthatit’smorethanjustthingstohaveandthingstodo,

onceyourealizethatwhatyouandIreallywantistohavetheroom,the

openness,toexpand,togrow,tobemoreofourselves,whateverthat

means,andtofindoutwhatthatmeansiswhat’smostimportanttous,

onceyouseethat,youcanthenturntothebusinessthat’sgoingtohelp

yougetthere;youcanthenturntothedevelopmentofyourStrategic

Objective.

YourStrategicObjectiveisaveryclearstatementofwhatyour

businesshastoultimatelydoforyoutoachieveyourPrimaryAim.

Itisthevisionofthefinishedproductthatisandwillbeyour

business.

Inthiscontext,yourbusinessisameansratherthananend,avehicle

toenrichyourliferatherthanonethatdrainsthelifeyouhave.

YourStrategicObjectiveisnotabusinessplan.Itisaproductofyour

LifePlan,aswellasyourBusinessStrategyandPlan.YourLifePlan

shapesyourlife,andthebusinessthatistoserveit.YourBusiness

StrategyandPlanprovidethestructurewithinwhichyourbusinessis

intendedtooperateovertimetofulfillyourLifePlan.YourBusiness

StrategyandPlanareawayofcommunicatingtoanyoneyoumust

communicatetothedirectionyourbusinessisgoing,howitintendstoget

there,andthespecificbenchmarksitwillneedtohitinorderforthe

StrategyandPlantowork.

YourBusinessStrategyandPlanarealsousefulformarketingyour

businesstothosewhoareimportanttoyou:yourbanker,yourinvestors,

andyourstrategicalliancesinthebusinesscommunity.

ButunlessyourBusinessStrategyandPlancanbereducedtoasetof

simpleandclearlystatedstandards,itwilldomoretoconfuseyouthanto

help.

YourStrategicObjectiveisjustsuchalistofstandards.

Itisatoolformeasuringyourprogresstowardaspecificend.

Itisdesignedforimplementation,notforrationalization.

Itisatemplateforyourbusiness,tomakecertainthatthetimeyou

investinitproducesexactlywhatyouwantfromit.

Let’stakeacloserlookatsomeofthestandardsthatneedtobe

includedinyourStrategicObjective.

TheFirstStandard:Money

ThefirststandardofyourStrategicObjectiveismoney.Gross

revenues.Howbigisyourvision?Howbigwillyourcompanybewhenit’s

finallydone?Willitbea$300,000company?Amillion-dollarcompany?

A$500-millioncompany?

Ifyoudon’tknowtheanswer,howcanyoupossiblyknowwhether

yourbusinesscanhelpyourealizeyourPrimaryAim?

Butgrossrevenuesalonearenotenough.Youalsohavetoknowwhat

yourgrossprofitsaregoingtobe,yourpretaxprofits,yourafter-tax

profits.

Atthispointyoucomeface-to-facewiththefirstdilemma

encounteredbyeveryonegoingintobusiness.Howcanyoupossiblyknow

nowwhatyourbusinessisgoingtoproduceinsalesthatfarinthefuture?

Theansweris,youcan’t!Butitdoesn’tmatter.Atthebeginningof

yourbusiness,anystandardsarebetterthannostandards.Creating

moneystandardsisnotjuststrategicallynecessaryforyourbusiness;itis

strategicallynecessaryforyourlife,fortherealizationofyourPrimary

Aim.

Indeed,thefirstquestionyoumustalwaysaskwhencreating

standardsforyourStrategicObjectiveis:WhatwillservemyPrimary

Aim?

Thefirstquestionaboutmoneythenbecomes:HowmuchmoneydoI

needtolivethewayIwish?Notinincomebutinassets.Inotherwords,

howmuchmoneydoyouneedinordertobeindependentofwork,tobe

free?

Infact,thereisultimatelyonlyonereasontocreateabusinessofyour

own,andthatistosellit!

Todoit,tofinishit,andthentogetpaidforit!

JustlikeRayKrocdid,tocreateyourFranchisePrototype,toturn-key

yourbusiness,tocreateabusinessthatreallyworks,andthensellit.

Howmuchdoyouwantforit?Tentimesearnings?Twentytimes

earnings?

Whendoyouwantit?Threeyearsfromnow?Fiveyears?

Whywouldanyonebuyit?

Becauseitworks!

Anditworksbecauseyoubuiltitthatway.Youbuiltitsothatitwould

workbetterthananyoneelse’sbusiness.Youinventedaturn-keysolution

toyourspecifickindofbusiness’sproblems.Alittlemoneymachine.An

absolutelypredictablelittlebusinessthatdoeswhatitpromisestodo

everysingletime.

Abusinessthatcangiveyoueverythingyouwant.

Andbecauseitcangiveyoueverythingyouwant,itcangiveyour

prospectivebuyereverythinghewants.

Atthispointanothersetofstandardsareimmediatelybroughtinto

thepicture.Becauseonceyou’vecreatedasetoffinancialstandardsfor

yourlife,onceyouknowwhatitisyourbusinessneedstoprovideyou

withasareturnonyourinvestment,itbecomesobviousthatthebusiness

musthavearealisticchanceofachievingthosestandards,ofproducing

thatreturnonyourinvestment.

Howcanyouknowwhetherornotitdoes?

BydeterminingwhetheryourbusinessisanOpportunityWorth

Pursuing.

TheSecondStandard:AnOpportunityWorthPursuing

AnOpportunityWorthPursuingisabusinessthatcanfulfillthe

financialstandardsyou’vecreatedforyourPrimaryAimandyour

StrategicObjective.

Ifitisreasonabletoassumethatitcan,thebusinessisworth

pursuing.

Ifitisunreasonabletoassumethatitcan,thennomatterhow

exciting,interesting,orappealingthebusinessis,forgetit.Walkaway

fromit.Itwillconsumetoomuchofyourprecioustimeandpreventyou

fromfindingatrueOpportunityWorthPursuing.

HowdoyouknowwhetheryouhaveanOpportunityWorthPursuing?

Lookaround.Askyourself:DoesthebusinessIhaveinmindalleviatea

frustrationexperiencedbyalargeenoughgroupofconsumerstomakeit

worthmywhile?

ThisstandardfulfillstwoprimaryrequirementsofyourStrategic

Objective.Ittellsyouwhatkindofbusinessyou’recreatingwhileit

defineswhoyourcustomerwillbe.Ittellsyouwhatyouneedtoselland

towhom.

WhatKindofBusinessAmIIn?

Askanyonewhatkindofbusinessthey’reinandthey’llinstinctively

respondwiththenameofthecommoditytheysell.“We’reinthe

computerbusiness.”Or,“We’reinthehottubbusiness.”Alwaysthe

commodity,nevertheproduct.

What’sthedifference?

Thecommodityisthethingyourcustomeractuallywalksoutwithin

hishand.

Theproductiswhatyourcustomerfeelsashewalksoutofyour

business.

Whathefeelsaboutyourbusiness,notwhathefeelsaboutthe

commodity.

Understandingthedifferencebetweenthetwoiswhatcreatingagreat

businessisallabout.

CharlesRevson,thefounderofRevlonandanextraordinarily

successfulentrepreneur,oncesaidabouthiscompany:“Inthefactory

Revlonmanufacturescosmetics,butinthestoreRevlonsellshope.”

Thecommodityiscosmetics;theproduct,hope.

InaChaneltelevisioncommercialinthe1980s,anincredibly

handsomemanandastrikinglybeautifulwomanarealonewhilemusic

playshypnoticallyinthebackground.

Thesceneshiftsquicklyandfrequentlytoothershots,suchasatall,

erectbuilding.

Sofartherehasn’tbeenasoundexceptforthemusicthatsupports

thissuggestivevisualballet.

Theblackshadowofanairplanemovesverticallyupthebuilding.

Sheapproacheshim.

Themusiccontinues.

Hesays,“CanIaskyouaquestion?”inavoicefilledwithintimacy

andinvitation.

Wedon’thearheranswer.

Wejustseehertiltherheadback,closehereyes,andopenhermouth

slightly.

Suddenly,themessage:“SharetheFantasy.Chanel.”

Notawordaboutperfume.That’sthecommodity.Thecommercialis

sellingtheproduct—fantasy.

Thecommercialissaying,“BuyChanelandthisfantasycanbeyours.”

What’syourproduct?Whatfeelingwillyourcustomerwalkaway

with?Peaceofmind?Order?Power?Love?Whatishereallybuying

whenhebuysfromyou?

Thetruthis,nobody’sinterestedinthecommodity.

Peoplebuyfeelings.

Andastheworldbecomesmoreandmorecomplex,andthe

commoditiesmorevaried,thefeelingswewantbecomemoreurgent,less

rational,moreunconscious.

Howyourbusinessanticipatesthosefeelingsandsatisfiesthemis

yourproduct.

Andthedemographicsandpsychographicsassociatedwithyour

customerwillpredeterminehowyoudothat.

WhoIsMyCustomer?

EverybusinesshasaCentralDemographicModel.Thatis,amost

probablecustomer.Andthatcustomerhasawholesetofcharacteristics

throughwhichyoucandefinehim—age,sex,income,familystatus,

education,profession,andsoforth.

Demographicsisthescienceofmarketplacereality.Ittellsyouwho

yourcustomeris.

YourCentralDemographicModelcustomerbuysforveryparticular

reasons,noneofwhicharerationalorevenexplicable!Yethebuys,or

doesn’t.

Themotivationsthatpropelhimineitherdirectionconstituteyour

CentralPsychographicModel.

Psychographicsisthescienceofperceivedmarketplacereality.Ittells

youwhyyourcustomerbuys.

Sowhenyouask,“IsthisbusinessanOpportunityWorthPursuing?”

theonlywaytotellistodeterminehowmanysellingopportunitiesyou

have(yourcustomers’demographics)andhowsuccessfullyyoucan

satisfytheemotionalorperceivedneedslurkingthere(yourcustomers’

psychographics).

StandardsThreeThrough?

ThereisnospecificnumberofstandardsinyourStrategicObjective.

Thereareonlyspecificquestionsthatneedtobeanswered.

WhenisyourPrototypegoingtobecompleted?Intwo

years?Three?Ten?

Whereareyougoingtobeinbusiness?Locally?

Regionally?Nationally?Internationally?

Howareyougoingtobeinbusiness?Retail?Wholesale?A

combinationofthetwo?

Whatstandardsareyougoingtoinsistuponregarding

reporting,cleanliness,clothing,management,hiring,firing,

training,andsoforth?

Youcanbegintoseethatthestandardsyoucreateforyourbusiness

willshapebothyourbusinessandtheexperienceyouhaveofyour

business.

Infact,thestandardsofyourStrategicObjectivecreatethetension

thatdrawsthefuturemodelofyourbusinessandthewayitactually

appearstodayclosertooneanother.

Aswesawearlier,standardscreatetheenergybywhichthebest

companies,andthemosteffectivepeople,produceresults.

Itwaseleveno’clockMondaymorning,oneweekfollowingmylast

meetingwithSarah.ItwastheonedayoftheweekAllAboutPieswas

closed.

Wedecidedtospendthedaytogethertotalkaboutherbusiness.

Asshewalkeduptothetableintherestaurantwherewehaddecided

tomeet,Icouldseeherexcitement.ShewasamuchdifferentSarahthan

whenIhadseenheraweekearlier.Hereyeswereclear,herbody

exuberant.Shelookedmuchyounger.Shealsolookedlikeshehadalotto

talkabout.

Therestaurantwasownedbyafriendofmine.Wehaddonealotof

worktogetherinhisstart-upyearsandsoitwasaplacewhereIcould

takeatableandspendasmuchtimeasIneededwithoutbeingrushed

outthedoor.Infact,itwasawonderfulplacetoprovideanewclientwith

someclarityaboutwhatabusinesscoulddowhendonewell.

Sarahsatdownandimmediatelybegantotalk.

Ipouredhersomecoffee.

“Itseemsforthefirsttimeinmylife,Itrulyhavecometosome

understandingaboutwhatIwant.Itisimportantformetotellyouhow

muchIappreciatewhatyou’vegivenme.But,havingsaidthat,Irealized,

fromalmostthemomentyouleftlastweek,thatIwouldneverallow

myselfagaintobeconsumedbytheworkofmybusiness.Itbecame

obvioustome,withaclaritythat’salmostimpossibletodescribe,howbig

apriceIhavebeenpayingforbeingsoobsessedwithmywork.And,once

Irealizedit,Iswear,itwaslikeIwassuddenlyandforeverfreeofit.

Somethingtrulyfreeinghappenedtomethatnight.

“Andit’snotasthoughIhaven’tbeenworkingforthepastsixdays.I

have.Businesshastogoon,afterall.Butthispastweekwasnottheway

itwasbefore.Whileonepartofmewasdoingthework—Iguessthat’sthe

partyouwouldcallTheTechnician—partofmestayedremovedfromit.

Partofmewasn’ttakenatallbytheworkIwasdoing.And,remember

howItoldyouthatIdidn’tthinkIwasentrepreneurial?Well,Isuddenly

realizedthatIam!ThatI’vealwayshadanentrepreneurialpartinme.

ThatwhatyoucallTheEntrepreneur,Ihavealwaysthoughtofasmy

spirit.

“‘Myspirit’iswhatmyauntcalledit.Sheusedtosaytome,‘Sarah,

feedyourspirit.Itisyourspiritwhichgivesyoulife.’Irememberasa

littlegirl,itwasmyspiritthatalwaysgotmeintotrouble.Itwasmyspirit

thatmyteacherscomplainedaboutsomuch.Theyusedtosaytomy

parents,‘Ifitweren’tforSarah’sspirit,shewouldbedoingmuchbetterin

schoolthanshedoes.’ItwasmyspiritthatwoulddreamwhenIwasin

theclassroom,ratherthanpayattentiontowhatwasgoingonaround

me.

“Iusedtofantasizeaboutthingsallthetime—myheadwenttothe

strangestplaces.Anythingcouldsetmeoff.Andwhilethatpartofme

wouldreallyseemtotickmyteachersandmyparentsoff,myauntalways

seemedtonurtureit.‘Youneedtobeverygentlewithyourspirit,Sarah,’

sheusedtosaytome.‘Itneedstobefree,butitalsoneedsyoutodirect

itsattention.Toomuchofone,andnotenoughoftheother,andyour

spiritwilltakeofflikeawildhorse.That’showyouneedtothinkofyour

spirit,Sarah,likeawildhorse.Partofitistheretoserveyou,andanother

parttoserveitself.Thethingyouneedtolearniswhichpartiswhich.If

youputitbehindafence,youwillkillit.Butifyouleaveittocomeandgo

asitpleases,youwillneverunderstandit.’

“AndIseethat’swhatI’vebeendoingthesepastthreeyears,”Sarah

saidtome.“I’veputafencearoundmyspirit,aroundmyentrepreneurial

nature,withoutevenrealizingit.ButwhatIreallycametounderstand

thispastweekisthatI’vebeendoingthat,puttingafencearoundmy

spirit,foralong,longtime.Myparentstaughtmehowtodoit;my

teacherstaughtmehowtodoit.And,likeagoodlittlegirl,Ilearnedthe

lessonwell.Butnowthewildhorseisfree!NowI’mbackinthekitchen

withmyauntagain.NowIreallyunderstandwhatmyauntwasdoing

withmeinthekitchenallthoseyearsago.Shewasn’tteachingmehowto

bakepies;shewasbakingme!Shewasteachingmeaboutthewildhorse,

aboutmyspirit.Aboutcreativity.

“AndwhenyoutalkedaboutTheEntrepreneur,itallcamebacktome

witharush.Myaunt,thekitchen,thepies,thedreaminginthe

classroom,thesecretplacesIusedtogohidewhenIwasalittlegirl.And

howIstoppedhidinginthoseplacesalongtimeago,andhowmuchI

missit!

“WhatI’vecometorealizeisthatI’veconfusedbakinggoodpieswith

whatmyauntwasreallytalkingtomeabout.Ithoughtthatbakinggood

pieswasit,whenitwasn’t.Itneverhasbeen.Anditneverwillbeagain.

“So,backtomybusiness,”shecontinued.“It’scleartomenowthat

whatIwishtodoistodevelopit,growit,andbefreeofittodowhatever

elseitisIwishtodo,eventhough,rightnow,atthisverymoment,I

couldn’tforthelifeofmetellyouwhatthatis.”

“Try,”Isaid.“Trytotellmeasbestyoucan.”

Shesmiled.“You’rejustlikemyaunt;sheneverletmeoffthehook

either.

“Okay,I’lltry.Whynot—whatelsedowehavetodo?”

Sheclosedhereyesforamomentandseemedtogatherherself.And

thenshebegantospeaksoftly,asthoughtoherself.

“I’malittlegirlagain.WhenIstillhadmyhidingplaces.BeforeIlost

myspirit.It’ssummer,andI’mlyinginbedlookingupattheceilingin

myroom,feelingthecoolsummerbreezefloatingthroughtheopen

window.There’snothingIhavetodo;there’snoplaceIhavetobe.It’s

themostwonderfulfeelingofmylife,lyingherelikethis,openingmy

eyes,closingthem,dreaming,smellingthewonderfulsummersmells,the

smellofcutgrass,thesmellofthewatersprinklingonthelawn,the

fullnessofit.

“AndthenIbegintodream,firstincolors,nothingspecific,just

colors,floatingabovemyhead,likecrystalsandflowersandblossomsof

lightinglowingcolors.Andthenthecolorstakeform—theyareme,and

theyarealsosomethingelse.I’mwalkingbythestreamthatrunsacross

ourland,about500feetfromthehouse,downwherethefouroaksstand.

Wehavethesefouroaks—huge,gnarledtreesthatstandlikeaminiature

forestatthecornerofourproperty.MyauntandIcalledthem‘Four

Oaks,’asthoughtheywereanothercountry.AndIusedtogothereasa

littlegirlandimagineIwasinanothercountry.

“I’min‘FourOaks’now,inmymind,asIliethereinmybed,asI

usedtodotimeaftertime.Andit’stherewheremywildhorsewaitedfor

me.Heisstandinginthecenterofthe‘FourOaks,’hisbodyglisteningin

theshade,blackasblackcanbe.Iwalkuptohimandtouchhisface,and

heshuddersandpullsawayfromme.Foramomentwewatcheachother

withoutmoving,andthen,he’sgone!Hewhirlsaroundandspeedsoff,

hismaneandtailstreaming,outofthetrees,throughthestream,overthe

hillontheothersideofthestream,andoutofsight.I’msuddenlyaware

ofthesweetsummerbreezeagain,asitsoftlytouchesmyface,andI’min

bed,huggingmyselfunderthecovers,thrilledtobealiveonsucha

wonderfulsummermorningwhenthere’snothingatallIhavetodobut

this.”

TearswerestreamingdownSarah’scheeks.Tearsofsomething

preciouslostandthenfound.Therewasaradiantsmileonherface.The

tearsalsowelledupinmyeyes,watchingher,understandingwhatthis

meanttoher,andunderstandingatthesametimewhatthismeanttome.

Weatelunchalmostwithouttalkingandthensettleddownintoan

afternoonofconversation.Thewaiterbroughtusapotoftea.Sarah

pouredherselfandmeacup,andthenIbegan.

“Tellme,”Isaid,“nowthatyouhaveabetterfeelingforwhatyour

businesscandoforyou,whydon’tyoutrytodescribeittome.Whydon’t

youbegintodescribeyourStrategicObjective?”

“Okay,”shebegan.“I’vegivensomethoughttothis,”shesmiled,

almostbashfully.

Iwasthinkingtomyself,asshefinishedcollectingherthoughts,that

I’veseenthatsmiledozens,ifnothundreds,oftimesbeforewhenowners

ofabusinessbegintoimaginetheircompanyassomethingbiggerthan

theyeverdaredtoimaginebefore,andastheytellittomeortosomeone

else.It’sasthoughtheyareembarrassedtobeseenimaginingsomething

biggerthantheyare;asthoughtheyareoverreaching,being

presumptuous.Isuspecttheymusthaveexperiencedsomethingsimilar

whentheywerechildren,tellingtheirparentsortheirteachersabouta

fancifulideatheyhad,andfeelingthedisappointmentandshamethat

comesfrombeingtoldthatyou’rebeingunrealistic,thatyou’redreaming,

hearingthemsay,“Youcan’tdothat.”Andfindingthemselvesaloneas

childrenwiththeirdreamsthattheydarednotshareagain.How,without

evenrealizingit,ourparentsandourteacherstakeour“spirit”away.

But,likeIknewshewould,Sarahcontinuedwithoutembarrassment

now,fullytakenbythepicturesshewasdescribing.Thiswasher

business,thiswasheridea,andshecouldseeitasclearlyasanything.

“Iseemybusinessaboutsevenyearsfromnow,”shesaid.“Thereare

fourlocations:theoneIhavenowandthreemore.”Shenamedthethree

communitiesadjoininghers.

“Thenameofthebusinessisthesame.There’snoneedtochange

that.Thebusinessisallaboutpies,allabouttheexperienceofpiesmy

auntgavetome.It’sthatexperienceIwishtogivetootherpeople.Not

onlymycustomersbutthepeopleIhire.Iwanteveryonetoknow,

somehow,thatAllAboutPiesisametaphorforsomethingmuchfiner.

“Iseetheshopsproducingannualsalesof$450,000each,foratotal

of$1,800,000ayear.I’mnottotallycertainwhatthenetprofitwillbe,

butI’vedecidedthatitshouldbeabout15percent,or$67,500foreach

shop,foratotalof$270,000forthefour.Ifeelthatthat’sareasonable

profittoshootfor,eventhoughtodayI’monlyproducingabout11

percent,aftermyincome,Imean.

“ThatmeansifIsellthebusinessinsevenyears,givenarealistic

price/earningsratio,Ithinkit’scalled,Ishouldbeabletosellthe

businessformorethan$1million.Onemilliondollarsinsevenyears—

that’smydream,”shesaidtome,smiling,asthoughshecouldalreadysee

themoneyinthebank.“Because,first,Iwon’teverneedanymoremoney

thanthattodoeverythingIhaveeverwanted,andsecond,becauseit’s

reallyagreatroundnumbertoshootfor.ItsortofmakeseverythingI

needtodoreallyconcrete.

“BeforeIcanopenmysecondshop,IrealizeI’vegottogetthisone

operatingwithoutme.Andso,oneofthefirstthingsI’mgoingtodo—and

I’vealreadybeguntodothissincewemetlastweek—istodocumentallof

thethingsIreallyknowhowtodotoday.Forexample,Iknowhowto

bakeagreatpie.AndIknowthatIcandocumenthowIdothat,sothat’s

oneofthefirstplacesI’mgoingtobegin.ButI’mgettingaheadofmyself.

Letmetellyouwhatmybusinesswilllooklikewhenit’sdone,soyoucan

reallygetafeelforit.

“Myauntusedtosaythatoneoftheproblemswehaveinourlivesis

thatwedon’texpressourcaringdeeplyoroftenenough.Sheusedtosay

thatwhenwewereinthekitchencuttingtheapples,orsomethinglike

that.She’dsay,‘Whenwecutapples,we’redoingsomethingimportant.

AndGodisgivingussomethingimportant,notonlytheapple,whichis

importantenough,butthekitchen,andtheknife,andthecompanywe’re

givingeachother.Sowhenwecuttheapples,weneedtorememberthat,

andholdthemjustright,andsliceintothemwithjusttheappropriate

force,nottoomuch,nottoolittle.’Shewouldsay,‘HoldmyhandwhileI

cuttheapple.DoyoufeelwhatImean?Nottoomuch,andnottoolittle.

Toomuchandyouaretakenawaybythetask.Toolittleandtheapple

doesn’tgetcut.’

“Anyway,inmybusinessIwanttoexpress‘nottoomuchandnottoo

little.’Iwantthebusinesstobeanexpressionof‘ourcaringdeeplyand

oftenenough.’Iwantthebusiness,AllAboutPies,tobeallaboutcaring,

notaboutpies.

“Andifthebusinessisallaboutcaring,theneverythingwedointhe

business,everythingthebusiness‘looks,acts,andfeelslike,’”shesaidto

mewithasmile,rememberingthestoryIhadsharedwithheraboutTom

Watson,“theneverythingthebusinessiswillbeareflectionofthat,a

reflectionofcaring.Caringwillbethetrueproductofmybusiness,not

pies.

“SoIseeAllAboutPiesasamodelforeveryonewhocomesinto

contactwithit.Andwhat’ssoexcitingaboutthatisIknowIcandoit!My

aunttaughtmehow.Iknowwhatitmeanstocareenoughaboutthe

kitchentoscrubitdownuntilitgleams.Iknowwhatitmeanstocare

enoughabouttheknivestosharpenthemuntilthey’rerazor-keen.Iknow

whatitmeanstoselectthefinestfruit,tospendtimesmellingit,holding

it,lookingatit,toknowexactlywhenit’sready.Tomakeabsolutely

certainofthat,myauntplantedherowngarden,herowntrees.Andwe

wouldseethatonlythebestoforganicfertilizerswereused,andsoI

knowthatAllAboutPiesneedstogrowitsownfruitinitsowngardens.

Andthat’ssomethingIjustrealizedthisweek!

“SoInowfeelcertainthat,inorderforAllAboutPiestobecomewhat

Icanimagineittobecome,itwon’tbeenoughformyemployeestojust

workintheshop—theyneedtolearneverythingjustasIdidwhenIwasa

girlworkingwithmyaunt.AllAboutPieswillbetothemwhatmyaunt

wastome!

“AndIknowIcandothat!”shesaidtome,againpassionately.“It’sas

realtomenowasmyauntwastomethen.

“Soeachshopwillproducepieswithfruitfromacentralorganic

garden.WhichmeansI’mgoingtohavetofindonetobuy,orlandthat

I’mgoingtohavetoplant,centrallylocatedbetweentheshopssothat

eachhastheaccessitneeds.

“Whatitalsomeansisthattheshopsareonlygoingtobakepiesfrom

fruitthat’sinseasonhere,whenit’sinseason.That’sallmyaunteverdid.

I’mnotgoingtousefruitfromanyplaceotherthanmyowngardens,and

thatisgoingtobesomethinguniqueaboutAllAboutPiesthat

differentiatesitfromeveryotherbakeryorsmallpieshop.Truly

homegrown.Withhomegrowngentlecare.

“Butwhat’salsoexcitingtome,”Sarahcontinued,“isthatIrealize

thatI’vealreadydonealotofwhatI’mdescribinginmycurrentshop!

“Thefloorsarethebestoak.Theovensarethebestyoucanbuy.The

displaycasesareabsolutelygorgeous.

“Myauntwouldhavelovedmyplace.

“Andthat’swhatIalsorealizedwhileIwasthinkingaboutallthis.

ThatifI’meverinquestionaboutwhetherI’mdoingitrightornot,allI

havetoaskmyselfis,‘Whatwouldmyauntthink?’andI’llknowthe

answer.

“Canyouseeit?”sheaskedmehonestly.

“AmIgivingyouatasteofwhatmyStrategicObjectiveis?AmIbeing

clearenough?”

“Sarah,”Ismiled,“youleavemespeechless.”

“Then,what’snext?”sheasked,asshepouredeachofusafreshcup

oftea.

14YOURORGANIZATIONALSTRATEGY

Allorganizationsarehierarchical.Ateachlevelpeopleserve

underthoseabovethem.Anorganizationisthereforeastructured

institution.Ifitisnotstructured,itisamob.Mobsdonotget

thingsdone,theydestroythings.

TheodoreLevitt

ManagementforBusinessGrowth

Everyonewantsto“getorganized.”Butwhenyousuggestthattheystart

bycreatinganOrganizationChart,allyougetisdoubtful—andsometimes

hostile—stares.

“Don’tberidiculous,”aclientonceretorted.“We’rejustasmall

company.Wedon’tneedanOrganizationChart.Weneedbetterpeople!”

Despitehisprotestations,Ipersisted.

BecauseIknewsomethinghedidn’t.

Iknewthattheorganizationaldevelopmentreflectedinthe

OrganizationChartcanhaveamoreprofoundimpactonasmall

companythananyothersingleBusinessDevelopmentstep.

OrganizingAroundPersonalities

Mostcompaniesorganizearoundpersonalitiesratherthanaround

functions.

Thatis,aroundpeopleratherthanaccountabilitiesorresponsibilities.

Theresultisalmostalwayschaos.

TobestshowyouwhatImean,let’stakealookatWidgetMakers,a

newcompanyformedbyJackandMurrayHopeful,brothersandnow

partners,inanenterprisethattheyaresurewillmakethemrich.

JackandMurraystarttheirpartnershipasmostdo,bysharingthe

work.

WhenJack’snotmakingthewidget,Murrayis.

WhenJack’snothelpingthecustomer,Murrayis.

WhenMurray’snotdoingthebooks,Jackis.

Inthebeginning,thebusinesshumslikeawell-oiledmachine.

Theshopisspotless.

Thewindowsgleam.

Thefloorsaremeticulous.

Thecustomerssmile.

AndJackandMurrayhustle.

Takingturns,alwaystakingturns.

OnMonday,Murrayopensup.OnTuesday,Jack.OnWednesday,

Murray.OnThursday,Jack.

Afterall,they’repartnersaren’tthey?

Iftheydon’tdoit,whowill?It’sonlyfairthattheysharethework.

Andtheygoonthatway.Andthebusinessbeginstogrow.

Allofasudden,there’smoreworkthaneitherMurrayorJackcan

handle.Theyhavetogethelp.

SotheyhireJerry.Agreatguy.Andanephewtoboot.

Aslongastheyhavetopaysomeone,mightaswellkeepitinthe

family.

Nowit’sJack,Murray,andJerry,takingturns,takingturns.

WhenJack’snotdoingthebooks,Murrayis.

AndwhenMurrayandJackaren’t,Jerryis.

NowwhenMurrayisn’tworkingwithacustomer,eitherJackorJerry

is.

OrwhenJackisn’topeningup,Murrayis,orJerry.

Thingsaremoving.Thebusinessisjumping.JackandMurrayand

Jerryareasbusyasthreepeoplecanbe.

Itisn’tlongbeforeHerbjoinsthem.Jack’swife’sbrother.Agoodguy.

Ahardworker.Willingandeager.

Nowit’sJack,Murray,Jerry,andHerb,takingturns,takingturns.

WhenJack’snotdoingthebooks,Herbis,orMurray,orJerry.

WhenMurray’snotworkingwithacustomer,it’sJackorJerryor

Herb.

WhenJerry’snotmakingwidgets,it’sMurrayorJackorHerb.

Everybody’sopeningup,answeringthetelephone,goingoutfor

sandwiches,makingdeposits—takingturns,takingturns,takingturns.

Butsuddenlythewidgetsbegintocomeback.Theydon’tseemtobe

workingliketheyusedto.

“Weneverhadthistroublebefore,”saysJacktoMurray.Murray

looksatHerb.HerblooksatJerry.

Allofasudden,thebooksbegintolookfunny.

“Weneverhadthistroublebefore,”saysMurraytoJack.Jacklooksat

Jerry.JerrylooksatHerb.

Andthat’snotall.

Theshopisbeginningtofallapart.

Toolsaremissing.

Dustisgettinginthewidgets.

Corrugatedcardboardisstrewnabouttheworktable.

Nailsareinthescrewboxesandscrewsinthenailboxes.

JackandMurrayandJerryandHerbarebeginningtobumpintoeach

otherontheirwayinandout.

They’reelbowingforroomintheworkspace.

Windowsaren’tgettingcleaned.

Floorsaren’tgettingswept.

Tempersbegintomount.

Butwho’stosaysomething?Andwhat?Andtowhom?

Ifeverybody’sdoingeverything,thenwho’saccountableforanything?

IfJackandMurrayarepartners,who’sincharge?

Ifboth,thenwhathappenswhenJacktellsJerrytodosomethingthat

Murraywon’tallowhimtodo?

WhenHerbwantstogoforlunch,whodoeshetell—Jack?Murray?

Jerry?

Who’saccountableformakingcertainthatthestoreismanned?

Whenthewidgetsgobad,who’saccountableforcorrectingthe

condition?

Whenthebooksareunbalanced,who’saccountableforbalancing

them?

Whenthefloorsneedcleaning,whenthewindowsneedwashing,

whentheshopneedsopeningorclosing,whenthecustomersneed

tending—who’saccountableforproducingtheresults?

WhatJackandMurraydon’tunderstandisthatwithoutan

OrganizationChart,everythinghingesonluckandgoodfeelings,onthe

personalitiesofthepeopleandthegoodwilltheyshare.

Unfortunately,personalities,goodfeelings,goodwill,andluckaren’t

theonlyingredientsofasuccessfulorganization;alone,theyarethe

recipeforchaosanddisaster.

Organizationneedssomethingmore.

OrganizingYourCompany

Let’sstartWidgetMakersalloveragain.

JackandMurrayHopefularesittingintheirkitchen.

TheyhavedecidedtoformWidgetMakers.

Theyareexcitedaboutitsprospectsbutknowthatifit’stosucceed

theyhavetoapproachitdifferentlyfromthewaymostpeoplestartanew

business.

Thefirstthingtheydecidetodoistothinkaboutthebusinessasa

corporation,ratherthanasapartnership.

Ratherthanthinkingofthemselvesaspartners,theynowthinkof

themselvesasshareholders.

Havingbothworkedinpartnershipswithotherpeople—andfailed—

JackandMurrayknowthatthere’snothingmoredisastrousthana

partnershipgonebad,assomanydo.

Unlessit’safamilybusiness,thatis.

JackandMurrayalreadyknowthatfamilybusinessesareevenworse

thanpartnerships.

Butapartnershipthat’salsoafamilybusiness?

No.JackandMurraydecidetodoitadifferentway.

Sittingthereatthekitchentable,JackandMurrayeachtakeablank

pieceofpaperandprinttheirnamesatthetopofthepage.

Undereachnametheyprint“PrimaryAim.”

Forthenexthourorso,JackandMurrayeachvisualizeshowhe

wouldlikehislifetolookandwriteshisconclusionsonthepageinfront

ofhim.

Thentheyspendanotherhourorsotalkingaboutwhattheywrote,

sharingtheirpersonaldreamswitheachother,perhapsdiscoveringin

thathourmoreabouteachotherthantheyhadknowninalltheiryearsas

brothers.

ThenextstepJackandMurraytakeistodrawalineacrossablank

pieceofpaperaboutathirdofthewaydown.Abovethelinetheywritein

boldlettersthewordSHAREHOLDERS.Theyhaveagreedwitheach

otherthatistobetheirroleoutsideofthebusiness.

Insideofthebusiness,theyhaveagreed,theywillfromthistime

forwardthinkofthemselvesasEMPLOYEES.

Theyrealizethiswillsavethemalotoftroublelateron.

Thenextstepwillrequiresometime:thecreationoftheStrategic

ObjectiveforWidgetMakers,Inc.JackandMurraygoatit

enthusiastically.Murrayagreestodothenecessaryresearchconcerning

theCentralDemographicModeltheyhavetentativelychosen.Howmany

potentialbuyersarethereintheterritoryinwhichthey’vedecidedtodo

business?Isthepopulationgrowing?Whatisthecompetition?Howare

widgetspricedandhowaretheyselling?Isthereafutureforwidgetsin

theterritory?Whatistheanticipatedgrowthoftheterritory?Anyzoning

changesexpected?

Murrayalsoagreestocreateaquestionnaireandmailittoasampleof

theirCentralDemographicModelconsumerstofindouthowtheyfeel

they’retreatedbyotherwidgetcompanies.Atthesametime,Murrayisto

personallycall150ofthoseconsumers.He’llconductaNeedsAnalysisto

getabetterunderstandingofhowtheythinkandfeelaboutwidgets.

Whatdowidgetsmeantothem?Howhavewidgetschangedtheirlives?If

theycouldhaveanykindofwidgetatall,whatwoulditlooklike?How

woulditfeeltouseit?Whatdotheywantagoodwidgettodoforthem?

Murrayagreestodotheresearchbyacertaindate.

Meanwhile,Jackagreestopulltogetherthepreliminaryfinancialdata

neededtosecurealoanfromthebank—anoperatingproformaanda

cashflowprojectionforthefirstyearofoperation.

Oncetheinformationabouttheconsumer,thecompetition,andthe

pricingiscollected,JackandMurraywillmeetagainandcompletetheir

StrategicObjectiveandpluginthefinalnumbersneededfortheloan.

Luckiswiththem.TheinformationMurraycollectsabouttheir

CentralDemographicModel,thecompetition,andthepricingismore

thanencouraging.

TheycompletetheirStrategicObjectiveandthenbeginthetaskof

organizationaldevelopment—thecreationoftheirOrganizationChart.

SincetheirStrategicObjectivehasindicatedhowtheywillbedoing

business(onelocation,assemblingandsellingwidgetsandwidget-related

accessoriestoaspecificconsumerwithintheterritorydescribedasNorth

MarineWest),JackandMurrayagreethattheirOrganizationChartwill

requirethefollowingpositions:

PresidentandChiefOperatingOfficer(COO),accountable

fortheoverallachievementoftheStrategicObjectiveand

reportingtotheSHAREHOLDERSwhoinclude,onan

equalbasis,JackandMurray.

Vice-President/Marketing,accountableforfinding

customersandfindingnewwaystoprovidecustomerswith

thesatisfactionstheyderivefromwidgets,atlowercost,

andwithgreaterease,andreportingtotheCOO.

Vice-President/Operations,accountableforkeeping

customersbydeliveringtothemwhatispromisedby

Marketing,andfordiscoveringnewwaysofassembling

widgets,atlowercost,andwithgreaterefficiencysoasto

providethecustomerwithbetterservice,reportingtothe

COO.

Vice-President/Finance,accountableforsupportingboth

MarketingandOperationsinthefulfillmentoftheir

accountabilitiesbyachievingthecompany’sprofitability

standards,andbysecuringcapitalwheneverit’sneeded,

andatthebestrates,alsoreportingtotheCOO.

ReportingtotheVice-President/Marketingaretwo

positions:SalesManagerandAdvertising/Research

Manager.

ReportingtotheVice-President/Operationsarethree

positions:ProductionManager,ServiceManager,and

FacilitiesManager.

ReportingtotheVice-President/Financearetwopositions:

AccountsReceivableManagerandAccountsPayable

Manager.

JackandMurraysitbackandlookatthecompletedOrganization

ChartofWidgetMakers,Inc.,andsmile.Itsurelookslikeabigcompany.

TheonlyproblemisthatJackandMurray’snameswillhavetofillallthe

boxes!They’retheonlytwoemployees.

Butwhattheyhaveeffectivelydoneisdescribealltheworkthat’s

goingtobedoneinWidgetMakers,Inc.,whenitsfullpotentialis

realized.

Moreimportantly,theyhavedescribedtheworkthathastobedone

rightaway!

JackandMurrayrealizethatthere’snodifferencebetweentheWidget

MakersoftodayandtheWidgetMakersoftomorrow;theworkisthe

same;onlythefaceswillchange.

ThenextjobjackandMurraytakeoniswritingaPositionContract

foreachpositionontheirOrganizationChart.

APositionContract(aswecallitatE-MythWorldwide)isasummary

oftheresultstobeachievedbyeachpositioninthecompany,thework

theoccupantofthatpositionisaccountablefor,alistofstandardsby

whichtheresultsaretobeevaluated,andalineforthesignatureofthe

personwhoagreestofulfillthoseaccountabilities.

JackandMurrayknowthataPositionContractisnotajob

description.

Itisacontract,ratherthanjustadescription,betweenthecompany

andanemployee,asummaryoftherulesofthecompany’sgame.

Itprovideseachpersoninanorganizationwithasenseof

commitmentandaccountability.

Accountabilityliterallymeans“standupandbecounted.”

Therefore,thePositionContractisthedocumentthatidentifieswho’s

tostandupandwhatthey’rebeingcountedontoproduce.

WidgetMakers,Inc.

OrganizationChart

HavingcompletedthePositionContractsforthepositionswithin

theirnewcompany,JackandMurray,asshareholders,proceedtothe

mostcriticaltaskoftheirnewassociation:namingthepeopletoputin

theboxes.

Andsincethereareonlytwoofthem,itbecomesevenmorecritical

thattheyapproachthistaskwiselyandcarefully,ifthey’retoavoidthe

errorsoftheirpast.

Oncetheyhavethatsettled,theygobelowthehorizontallineandin

themiddleofthepieceofpapertheydrawaboxinwhichtheywritethe

lettersCOO,forChiefOperatingOfficer,orPresident,oftheirnew

corporation.

Thenextmostdifficultstep,ofcourse,istodecidewhichoneofthem

isgoingtofillthatposition,understandingthatitcanbeonlyoneof

them.Therecan’tbetwoChiefOperatingOfficersofacompany.

Someone’sgottobeaccountable.Someone’sgottobeincharge.

WillitbeJack?WillitbeMurray?

Theyponderthequestionseriously.

Thisisthepersonfulfillingtherolethatwillultimatelybeaccountable

toJackandMurrayfortherealizationoftheirdream.

Aftercarefulthought,MurraydecidesonhisownthatJackshoulddo

it.

AlthoughMurrayistheolderbrother,heknowsinhisheartthatJack

hasalwaystakenhisaccountabilitiesmoreseriously.

JackhasalwaysbeenmorethoroughthanMurray.WhileMurrayhas

alwaysbeenthemorecreativeofthetwo,creativityisnotnecessarily

what’scalledforhere—organizationis.

Afterall,theirlifesavingsareatstake.

Ifthebusinessistogivethembothwhattheywant,someonewill

havetotakeitveryseriouslyindeed.

MurrayconferswithJackabouthisdecision.

Theybothunderstandwhat’satstakehere.Acommitmentoftrust,

bothtoeachotherandtotheStrategicObjectivetheyhavefashioned

togetherwithgreatcare.

Theybothunderstandthisismorethanjustajob:it’saheartfelt

commitment.

Afteralongdiscussion,theyagreeonJackforCOO,andJack

solemnlyacceptstheposition,aswellastheauthoritythatgoeswithit,by

signingthePositionContractforCOO,orPresident.

NextcomethethreeVice-Presidentialpositions:Marketing,

Operations,andFinance.

JackasksMurrayifhewouldagreetobeVice-President/Marketing,

sincehedidsuchanexceptionaljobonthemarketingresearchprojectat

theoutsetoftheirventure.

Murrayagreesenthusiastically—thisistheworkhehadhopedtodo

allalong—andgladlysignstheVice-President/MarketingPosition

Contract.JackthensignsMurray’sPositionContractasthePresident

(theVice-President/Marketing’smanager)onbehalfofthecompany.

NextcomesVice-President/Operations.Jackagreestotakethis

positionbecauseitwillbedifficult,hereasonswithMurray,forMurrayto

bothsellthewidgetsandmakethematthesametime.ThistimeJack

signsthePositionContractbothasVice-President/Operationsandas

President.

Finally,JacktakesontheaccountabilityofVice-President/Finance,

andsignsthePositionContractforthatposition.There’snoquestion

betweenJackandMurraywho’sbestsuitedforthatjob.

MurraynowassumesthepositionsofSalesManagerand

Advertising/ResearchManager,andsignsthosePositionContracts.

JacktakesthepositionsofProductionManager,ServiceManager,

andFacilitiesManager,aswellasthoseofAccountsPayableManagerand

AccountsReceivableManager,andsignsthosePositionContracts.

WithallPositionContractssigned,JackandMurraysitbackfora

secondtimetosurveywhatthey’vedone.Whentheyseeit,they’re

shocked!JackhasbeengiveneightjobstoMurray’sthree!Something’s

gottobechanged.

Aftersomethought,theyagreetohaveMurraytakeonthe

accountabilitiesofAccountsReceivableandAccountsPayableaswellas

thatofServiceManager.

Thatmakesitsixjobseach.

Anyoneshouldbeabletodosixjobsonanaverageday,Jackand

Murraythinktothemselvesambitiously.

And,finally,theorganizationisdone!

Notabitofworkhadbeenperformedonthejob,andyetthetwoof

themwereabletoconceiveofthecompany,theworkthatneedstobe

done,thestandardsbywhichtheywouldholdeachpositionaccountable,

andwhichpositionisaccountabletowhichpositionandspecificallyfor

what.

Anduponcompletingthisonepreparatoryact,asenseoforderswept

throughJackandMurray.Asenseofelation.

Fordespitetheobvioussizeofthejobahead,somehowitlooked

doable.

SomehowJackandMurrayknewtheyweregoingtogetitalldone.

Theywereorganized.

Theyhadsomesemblanceofaplan.

IncreatingtheirOrganizationChart,JackandMurrayhadalso

generatedtheblueprintfortheirFranchisePrototype.

PrototypingthePosition:ReplacingYourselfwithaSystem

Havingcreatedapictureofthebusinessasitwilllookwhenit’sfinally

done,JackandMurraystarttheprototypingprocess.

Butatthebottomoftheorganization,notatthetop.

Theystartworkingonthebusinesswheretheystartworkinginthe

business.

InthepositionofSalespersonandProductionPersonandAccounts

ReceivableClerk.

Notastheownersorpartnersorshareholders.NotastheCOOorthe

VP/Marketing.

Butasemployees,attheverybottomoftheorganization.Doing

TacticalWork,notStrategicWork.

TacticalWorkistheworkalltechniciansdo.

StrategicWorkistheworktheirmanagersdo.

IfJackandMurray’sbusinessisgoingtothrive,theyhavetofind

otherpeopletodotheTacticalWorksoastofreeJackandMurraytodo

theStrategicWork.

TheOrganizationChartisthemeansthroughwhichthatcritical

transitioncanbemade.

Let’swatchasJackandMurraygothroughthesamegrowthprocess

theyexperiencedatthebeginningofthischapter,butthistimeavoiding

theirearlierdisasterbyprototypingthepositionsintheirOrganization

Chart.

JackandMurraygotoworkintheirbusiness.Butnowwitha

difference.Theyarenolongerinterestedinworkingintheirbusiness.

Theyarenowfocusedondevelopingabusinessthatworks.Todothat

theybegintoworkinanentirelydifferentway.

AsMurraygoestoworkinthepositionofSalesperson,healsogoesto

workonthepositionofSalespersonasVice-President/Marketing.

AsJackgoestoworkinthepositionofProductionPerson,healso

goestoworkonthepositionofProductionPersonasVice-

President/Operations.

Inotherwords,MurrayandJackstartbuildingtheirbusinessby

lookingateachpositioninthebusinessasthoughitwereaFranchise

Prototypeofitsown.

AsMurraygoestoworkinthepositionofSalespersonasa

Salesperson,healsogoestoworkonthepositionofSalespersonby

implementingtheBusinessDevelopmentProcessofInnovation,

Quantification,andOrchestration.

Likewise,whenJackgoestoworkinthepositionofProduction

PersonasaProductionPerson,hegoestoworkonthepositionof

ProductionPersonbyimplementingtheBusinessDevelopmentProcess

ofInnovation,Quantification,andOrchestration.

Eachofthemasks,“Whatwouldbestserveourcustomerhere?How

couldImosteasilygivethecustomerwhathewantswhilealso

maximizingprofitsforthecompany?Andatthesametime,howcouldI

givethepersonresponsibleforthatworkthebestpossibleexperience?”

MurraybeginstotesttheclothinghewearsasaSalespersontosee

whatcolorsandstylesproducethegreatestpositiveimpactonthe

customers.

Hestartstestingdifferentwords.

HebeginstothinkabouthowWidgetMakers,Inc.,interactswithits

customers,andhoweachcomponentofthisinteractioncouldbe

modifiedtoincreaseitseffectiveness.

Andashequantifiestheimpactofhisinnovationsonsales,hetakes

themostproductiveofthemandwritesthemdownintheWidgetMakers

SalesOperationsManual.

Beforelong,theSalesOperationsManualcontainstheexactscripts

forhandlingincomingcalls,outgoingcalls,meetingthecustomeratthe

door.Theexactresponsestocustomerinquiries,complaints,concerns.

Thesystembywhichanorderisentered,returnsaretransacted,new

productrequestsareactedupon,inventoryissecured.

OnlywhentheSalesOperationsManualiscompletedoesMurrayrun

anadforasalesperson.

Butnotforsomeonewithsalesexperience.

NotaMasterTechnician.Butanovice.Abeginner.AnApprentice.

Someoneeagertolearnhowtodoitright.

SomeonewillingtolearnwhatMurrayhasspentsomuchtimeand

energydiscovering.

Someoneforwhomquestionshaven’tbecomeanswers.

Someonewhoisopentothepossibilityoflearningskillshehasn’t

developedyet,skillshewantstolearn.

AndtheadisplacedunderSalesintheClassifiedSectionofthe

Sundaypaper.Itreads:COMEANDSEEOURTURN-KEYOPERATION.

COMEANDSEEOURMONEYMACHINE.NOEXPERIENCE

NECESSARY.JUSTANOPENMINDANDAWILLINGNESSTO

LEARN.

AndasMurrayinterviewsthecandidates,heshowsthemtheSales

OperationsManualandWidgetMakers’StrategicObjective,andexplains

howtheywerecreatedandwhy.

HetellsthemthestoryofWidgetMakers,thedreamheandJack

conceived,toenablethemtomakeapersonaldifferenceinthemarketin

whichtheyhavechosentobecomeleaders.

HeshowsthemtheOrganizationChart,wherethepositionof

Salespersonis,towhichpositionitreports,andwhoinWidgetMakersis

currentlyaccountableforthatposition.

HetalkstothemabouttheirPrimaryAimtodeterminewhoamong

themhasavisionthatcoincideswithWidgetMakers’viewoftheworld.

Andwhenhefindstherightperson,Murrayhireshim,handshimthe

SalesOperationsManual,hashimmemorizethewordsinit,dressto

code,learnthesystems,andfinally,gotowork.UsingtheSalesSystem,

Murrayinnovated,quantified,andorchestrated.

Atthatmoment,atthatexactinstant,Murraymovesuptothe

positionofSalesManagerandbeginstheprocessofBusiness

Developmentalloveragain.

Becauseatthatmoment,Murrayhastakenthemostimportantstep

infreeinghimselffromtheTacticalWorkofhisbusiness.Murrayhas

replacedhimselfwithasystemthatworksinthehandsofapersonwho

wantstoworkit.

AndnowMurray’sjobbecomesmanagingthesystemratherthan

doingthework.

MurrayisnowengagedinStrategicWork.

AndwhileMurraydidthat,Jackdidtheverysamethingforeachof

theTacticalWorkpositionshewasresponsiblefor!

Bothofthemworkingonthebusinesswhileworkinginit,andall

accordingtoplan.

NowJackandMurrayhavelearned,byexperience,animportant

lessonindevelopingtheirbusiness,alessoneveryTechniciansuffering

fromanEntrepreneurialSeizuremustlearnifhisbusinessandhislifeare

toworkinharmony.

ThatyourOrganizationChartflowsdownfromyourStrategic

Objective,whichinturnflowsdownfromyourPrimaryAim.

Thateachisthecauseoftheoneprecedingit,andeach,therefore,

playsapartinthefulfillmentoftheonebeforeit.

Alogicisestablished,anintegratedwhole.

Inthisexample,WidgetMakers,Inc.,becameanorderlysystemfor

creatingandre-creatingJackandMurray’slives.

WithouttheOrganizationChart,confusion,discord,andconflict

becometheorderoftheday.

Butwithit,thedirection,purpose,andstyleofthebusinessare

balanced,interactingpurposefullyandprogressingwithintentionand

integritytowardacohesiveandsensiblewhole.

Finally,goodpeoplecouldcometogetherandgetsomethingdone!

Sarahexhaledloudlyandstretched,botharmsextendingfullytowardthe

ceilingasthoughshewaslettinggoofafeelingshewashavingdifficulty

handling.

“Boy,”shesaid,“yousuredon’tmakeiteasy.TheminuteIthinkI’ve

gotthisentrepreneurialthinghandled,yougivemesomemoreworkto

do.

“I’dliketogobackoverthisagainbecauseI’mnotsureI’vegotit.

“Whatyou’resayingisthatIneedtocreateanOrganizationChartfor

AllAboutPiesasitwilllookwhenit’sdone,sevenyearsfromnow,rather

thanthewayitisnow?”

“Yes,”Iresponded.

“AndthatonceI’vecreatedthatOrganizationChart,Ineedtoputmy

nameinallthepositionsIcurrentlyfill?”

“Rightagain,”Ianswered.

“AndthatIneedtocreateverydetaileddescriptionsofeachoneof

thosepositions,andthensignthePositionContractsforeach,asthoughI

wereanemployeetakingresponsibilityforeachjob?DoyoumeanI

actuallyneedtosigneachPositionContract,exactlyasthoughIwerethat

employee?”

“Yes,”Isaid,“exactlyasthoughyouwerethatemployee.Becauseif

yourbusinessisgoingtowork,youareeachoneofthoseemployees!

Untilyoureplaceyourselfwithsomeoneelse,thatis.”

Shecontinuedtopressforward,hereyesshininglikediamonds,

intense,awake,engaged.

“Andthereasonforthatis,”Sarahsaid,“thatunlessIactasIexpect

myemployeestoact,unlessIworkinmybusinessexactlyasIwishthem

to,IwillneverbeabletocreateasystemfordoingitexactlythewayI

expectthemtodoit.

“Inotherwords,unlessIactinexactlythesamewayasIexpectmy

employeestoact,thesystemIcreatewillindulgemypreferences,rather

thanwhatthebusinessreallyneedstomakeitpossibleforeveryoneother

thanmetobeasproductiveandhappyaspossible.

“AndifIonlyindulgemypreferences,Iwillneverbeabletoreplace

myselfwithanyoneotherthananotherowner,someonejustlikeme,

someonewiththesameinterestsasanowner,someonewiththesame

goalsasmine.”

Shepausedforamomentasthoughtocatchherbreath,andthen

added,“Isthatwhatyouaresaying?”

“Exactly!”Ianswered.“Becauseit’scriticalifyouaretobeginyour

businessalloveragainthatyou’reabletoseparateyourselffromtheroles

youneedtoplay.Tobecomeindependentofthem,ratherthantheseroles

becomingdependentonyou.

“Rememberwetalkedearlieraboutthecrazy-makingnatureofall

yourdifferentpersonalities,andthattheonlywaytoeliminatethat

crazinessistoorganizeyourselfandtheworldaroundyouasclearlyas

possiblesoyoucanfunctionasclearlyaspossible?

“Well,it’sthedysfunctionalnatureoftheseunconsciouspersonalities

wehavetocombat.

“It’sourautomaticnaturewe’vegottoorganizeintoanintentional

nature.

“Andtheonlywaywecandothatisintentionally,notautomatically.

“Andsoonepartofus,thepartamannamedGurdjieffoncecalled

the‘driver,’mustorderalltherest.

“Thedrivermusttakechargeofthehorseandcarriage,Gurdjieffonce

said.

“And,astheownerofyourbusiness,asthedriverofyourbusiness,

that’syourprimaryjob:totakechargeofthehorseandcarriage.

“And,todoso,youmustbeabletodifferentiateamongalltheroles,

todiscriminatebetweenwhat’smostimportantandwhat’sleast

important,toorganizeitinsuchawaythatyourbestintelligencetellsyou

yourbusinessmustwork.

“And,onceyouhavedonethat,onceyou’veorganizedyourbusiness

inthemostintelligentwayyoucan,yournextmostimportantjobisto

followtherulesofthegameyouhavecreatedwithintegrity.

“Becauseifyouwon’tfollowtherules,whyshouldanyoneelse?

“Iftherulesdon’tapplytoyou,theleader,whyshouldyouexpect

anyonetofollowyou?

“Ifyoudon’tobeytherules,honorthem,extolthem,whyshouldyou

expectanyoneelsetotakeyourgameseriously?

“Theansweris,youcan’texpectthemto,becausetheywon’t!

“Andthat’swhatthiswholeprocessoforganizationaldevelopmentis.

It’stheprocessthroughwhichyouthinkthroughyourbusinessasbestas

you’reableandthenstructurethewayitistowork.YourOrganization

Chartisthatstructure.Itisyoutalkingtoyourpeopleandtheworld,

tellingthemexactlyhowyouseeyourbusinessworkingwhenit’sdone.

Whenthedreamisinplace.It’syousharingyourmindwiththeworld.

Andthen,oncehavingsharedit,it’syoutellingyourpeopleandtheworld

thatyoubelieveenoughinthevisiontoliveityourself!

“Anythinglessthanthatissheerarrogance,”Itoldher.

“But,whenyoulivebyyourownrules,whenyou‘walkyourtalk,’

whenyouliveasyouthink,thenyourbusinesswillbecomeathingto

behold.”

“Gotit!”shesaid.

“Ididn’thaveadoubtintheworldbutyouwould,”Iresponded.

“So,let’sgoontoManagementDevelopment,”IsaidtoSarah,asI

pouredherafreshcupoftea,“andthentoPeopleDevelopment.

“Becausewheremanagement,people,andsystemscometogether,so

doesyourPrototype.”

15YOURMANAGEMENTSTRATEGY

TheSystemistheSolution.

AT&T

Youmaythinkthatthesuccessfulimplementationofamanagement

strategyisdependentonfindingamazinglycompetentmanagers—people

withfinelyhoned“peopleskills,”withdegreesfrommanagementschools,

withhighlysophisticatedtechniquesfordealingwithanddeveloping

theirpeople.

Itisn’t.

Youdon’tneedsuchpeople.

Norcanyouaffordthem.

Infact,theywillbethebaneofyourexistence.

Whatyouneed,instead,isaManagementSystem.

TheSystemwillbecomeyourmanagementstrategy,themeans

throughwhichyourFranchisePrototypeproducestheresultsyouwant.

TheSystemwillbecomeyoursolutiontotheproblemsthatbesetyou

becauseoftheunpredictabilityofyourpeople.

TheSystemwilltransformyourpeopleproblemsintoanopportunity

byorchestratingtheprocessbywhichmanagementdecisionsaremade

whileeliminatingtheneedforsuchdecisionswhereverandwhenever

possible.

WhatIsaManagementSystem?

ItisaSystemdesignedintoyourPrototypetoproduceamarketing

result.

AndthemoreautomaticthatSystemis,themoreeffectiveyour

FranchisePrototypewillbe.

ManagementDevelopment—theprocessthroughwhichyoucreate

yourManagementSystem,andteachyourup-and-comingmanagersto

useit—isn’tamanagementtoolasmanypeoplebelieve.It’samarketing

tool.

ItspurposeisnotjusttocreateanefficientPrototypebutaneffective

one.

AndaneffectivePrototypeisabusinessthatfindsandkeeps

customers—profitably—betterthananyother.

Let’slookathowsuchasystemwasputintopracticebyaresorthotel

I’vepatronizedoverthepastseventeenyears.

AMatch,aMint,aCupofCoffee,andaNewspaper

Thefirsttimeitwasanaccident;thatis,anaccidentforme.Ihadn’t

plannedtogothere.

I’dbeendrivingforsevenhours,and,tiredoftheroad,decidedto

stopforthenightbeforegoingontoSanFrancisco.

ThehotelwaslocatedinaredwoodgroveoverlookingthePacific.

BythetimeIwalkedintothelobby,thesunwassettingandthegrove

hadturneddarkaspitch.

InstantlysomethingtoldmethatIwasinaspecialplace.Thelobby

waswarmlylighted.Redwoodpanelingreflectedtheredglowofthelight

ontobeigeoverstuffedcouchesthathuggedthethreewallssurrounding

thereceptiondesk.Along,darkwoodtablefacedthefrontdoorthrough

whichIhadjustentered.OnthetablerestedahugewovenIndianbasket

overflowingwithfreshfruit.Besidethebasketstoodamassivebronze

lamp,itsdeepburnishedlightbouncingoffthefruit,addingafestivelook

totheroom.Runningthefulllengthofthetableandfallingdownon

eitherendalmosttothefloorwasanintricatelycrochetedlinencloth,its

bright,exoticpatternaccentuatingthecolorsofthefruit,thebronzeof

thelamp,andthedeepredochreofthewalls.

Atthefarsideofthetable,againstthefarwall,inamassivefieldstone

fireplace,aroaringfirefilledtheroomwiththecheerfulcracklingofits

furiouslyburningoaklogs.

EvenifIhadn’tbeensotired,thecontrastbetweentheheatofthe

flamesonmyfaceandthecoldofthenightatmybackwouldhavebeen

enoughtoattractmetotheroom.Asitwas,Ipracticallymeltedwith

delight.

Behindthereceptiondeskawomanappeareddressedinafreshly

starchedred,green,andwhiteginghamblouseandadeepredochreskirt.

Apinwiththelogoofthehotelatoparedochreribbondecoratedher

blouselikeabadgeofhonor.Amatchingribbonheldherhairbackfroma

glowingface.

“WelcometoVenetia,”shesmiledwarmly.

Ittooknomorethanthreeminutesfromthemomentshespokethat

greetingtothetimethebellboyusheredmeintomyroom,despitethe

factthatIhadnoreservation.Icouldn’tbelievetheeasewithwhichitall

happened.

Andtheroom!Theoverallimpressionwasoneofunderstated

opulence—thick,mutedpastelwall-to-wallcarpeting;afour-poster,king-

sizewhitepinebedcoveredbyamagnificent,impeccablyclean,white-on-

whitequilt;originalgraphicsdepictingscenesandbirdsofthePacific

Northwestgracingtherough-hewneleganceofthenaturalcedarwalls;a

stonefireplacewithoaklogsalreadypreparedandwaitingonthegrate

forthefiresomeoneknewIwouldappreciate,paperrolledceremoniously

beneaththegrate,andanelegantoversizedmatchlyingdiagonallyacross

thehearth,waitingtobestruck.

Delightedwithmygoodfortune,Ichangedfordinner;thewomanat

thedeskhadmademyreservationwhenshecheckedmein!Iwalkedout

intothenighttofindtherestaurant.Asignbyapathoutsideofmyroom

pointedmedownanotherwell-litpaththroughthedarkredwoodgrove.

Thenightairwasstillandclear.

InthedistanceIcouldhearthehushed,rhythmicpatterofthePacific

Oceansurf.Orwasitmyimagination?Itscarcelymattered;anauraof

magicsurroundedtheplace.

Therestaurantstoodonaknolloverlookingthehotelandtheocean.

UntilIwentinside,Ihadn’tseenanotherperson,buttherestaurantwas

crowded.

Igavethemaitred’mynameandheimmediatelyshowedmetoa

table,despitethefactthatotherpeoplewerewaiting.Evidently,

reservationsmeantsomethinginthisrestaurant!

ThemealwasasdelightfulaseverythingIhadexperiencedbeforeit,

thefoodattractivelyprepared,theserviceattentiveyetunobtrusive.I

lingeredoveraglassofbrandywhileenjoyingaclassicalguitaristwho

playedaselectionofBachfuguesforthedinnerguests.

Isignedthecheckandreturnedtomyroom,notingonthewaythat

thelightshadbeenturneduponthepathapparentlytocompensatefor

thegrowingdarkness.

BythetimeIarrivedatmyroom,thenighthadbecomechilly.Iwas

lookingforwardtoafireandpossiblyanotherbrandybeforegoingtobed.

Somebodyhadbeatenmetoit!

Abriskfirewasburninginthefireplace.Thequiltwasturneddown

onthebed.Thepillowswereplumpedup,amintrestingoneachone.

Ononeofthenighttablesbesidethebedstoodaglassofbrandyanda

card.Ipickedupthecardandread:

WelcometoyourfirststayatVenetia.Ihopeithasbeenenjoyable.If

thereisanythingIcandoforyou,dayornight,pleasedon’thesitateto

call.

Kathi

AsIdriftedtosleepthatevening,Ifeltverywelltakencareof.

ThefollowingmorningIawoketoastrangebubblingsoundinthe

bathroom.Iarosetoinvestigate.

Apotofcoffee,turnedonbyanautomatictimer,wasmerrilyperking

awayonthesinkcounter.Acardrestingagainstthepotsaid:

Yourbrandofcoffee.Enjoy!K.

Anditwasmybrandofcoffee!

Howintheworldcouldtheyhaveknownthat?

AndthenIremembered.Attherestaurantthenightbeforetheyhad

askedmewhatbrandofcoffeeIpreferred.Andhereitwas!

JustasIcaughtontowhattheyhaddone,therewasapoliteknockat

thedoor.

Iwenttothedoorandopenedit.Nobody.Butthereonthematwasa

newspaper.Mynewspaper,theNewYorkTimes.

Howintheworlddidtheyknowthat?

AndthenIremembered.WhenIcheckedinthenightbeforethe

receptionisthadaskedmewhatnewspaperIpreferred.Ihadn’tgivenit

anotherthought.Untilnow.Andthereitwas!

AndexactlythesamescenariohasoccurredeachandeverytimeI’ve

returned.

ButafterthatfirsttimeIwasneveraskedmypreferencesagain.

Ihadbecomeapartofthehotel’sManagementSystem.

Andneveroncehasitletmedown.

ThesystemknowswhatIlikeandmakescertainthatIgetit,in

exactlythesameway,atexactlythesametime.

WhatexactlyhadtheSystemprovided?Amatch,amint,acupof

coffee,andanewspaper!

Butitwasn’tthematch,themint,thecupofcoffee,orthenewspaper

thatdidit.Itwasthatsomebodyhadheardme.

Andtheyheardmeeverysingletime!

ThemomentIwalkedintotheroomandfeltthefire,Iknewthat

someonehadthoughtaboutme.HadthoughtaboutwhatIwanted.

Ihadn’tsaidaword,andyettheyhadheardme.

ThemomentIsawthemintsonthepillows,theturned-downquilt,

andthebrandyonthetable,Iknewthatsomeonehadthoughtaboutme.

HadthoughtaboutwhatIwanted.

Ihadn’tsaidawordandyettheyhadheardme.

ThemomentIheardthecoffeepotperkinginthebathroomandsaw

thecardthatidentifieditasmybrand,Irememberedthatsomeonehad

askedformypreference.

Andtheyhadheardmyanswer.

TheinstantIsawthenewspaperandrecognizeditasmynewspaper,I

rememberedthatsomeonehadasked.

Andtheyhadheardmyanswer.

Anditwastotallyautomatic!

Everysingleelementwasanorchestratedsolutiondesignedto

produceamarketingresult,anintegratedcomponentofthehotel’s

ManagementSystem.

Aftermythirdvisittothehotel,IaskedtospeakwiththeManager.

Iwantedtofindouthowhewasabletoproducetheidenticalresults

formeeverysingletime.

Howcouldhemakecertainthatsomeonewouldasktheright

questionssoastoensurethecorrectresultsforeachandeveryguest?

Wasitbecausehehiredextremelycompetentpeople?

Weretheemployeesowners?

Wasitsomekindofspecialincentivesystem?

TheManagerwasayoungmanoftwenty-nine.Heinvitedmeintohis

officetotalk.Itwaswell-lit,modestinsize,andoverlookedtheredwood

groveIhadwalkedthroughtogettotherestaurant.Hisdeskwasclean

andneatlyorganized,notaloosepaperinsight.

“Thisisaveryorderlyyoungman,”Ithoughttomyself.

“Perhapshe’sthereasonthehotelworkssowell.”

TheyoungManagerobviouslyenjoyedhisjob,becausehewarmed

immediatelytotheconversationabouthisworkandthetaskofproducing

theresultsforwhichhewasheldaccountablebythehotel’sowner.

“Youknow,”hesaid,smilingself-consciously,“it’sfunnysittinghere

talkingtoyouaboutwhatwedohereatthehotel.Becauseuntilfive

monthsago,theonlyexperienceIhadinthehotelbusinesswasasaguest

fortwonightsataHolidayInninFresnothreeyearsago.

“Infact,”hecontinued,“beforethisjobIwasworkingasashort-order

cookatarestaurantnearby.TheownerandIgottoknoweachother.He

askedifI’dliketolearnthehotelbusiness,and,beforeIknewit,hehired

me.EverythingIknowaboutthehotelbusinessI’velearnedhere.

“Here,letmeshowyou.”

Hereachedbehindhisdeskforaredbinder.Printedonthespine

weretheinitialsOMandthelogoofthehotel.

“Whatwedohereissimple.Anyonecandoit.”

Heopenedthebindertothetableofcontents.

“ThisisourOperationsManual.Asyoucansee,it’snothingbuta

seriesofchecklists.Thisoneisachecklistforsettinguparoom.”He

openedthebooktoayellowpage.

“Thisgroupofpagesisyellow.EverythingintheManualiscolor

coded.YellowhastodowithRoomSetup.Blue,withGuestSupport

Services.Forinstance,whenwelightyourfireatnight,putthemintson

yourpillow,andsoon.

“EachchecklistitemizesthespecificstepseachRoomSupportPerson

musttaketodohisorherjob.Thereareeightpackagesofchecklistsfor

eachRoomSupportPersonwaitingintheirmailboxwhentheycomein

everyday.Eachpackageofchecklistsisusedforoneoftheeightrooms

theRoomSupportPersonisaccountablefor.

“AsaRoomSupportPersongoesabouttheprocessoftakingcareof

hisorhereightrooms,achecklistiscompletedtoconfirmthateach

accountabilitywasperformedaccordingtothestandards.Asyoucansee,

hereatthebottomofthechecklistisaplacefortheRSPtosign,

indicatingthatheorshedidtheprescribedwork.

“Tosignandnottohavedonetheworkisgroundsforinstant

dismissal.

“Butthere’sanotherpartofthesystemthatreallymakesitwork.

“Onthebackofeachchecklistisadrawingofthespecificroomthat

identifieseachtasktobecompleted,andtheorderinwhichithastobe

done.ThedrawingtakestheRSPthroughtheroutine,and,asthey

completeeachtask,theycheckoffthecorrespondingpartofthedrawing

toshowthatitwasdone.

“Withthisdrawingwecantrainnewpeoplealmostinstantlyandhave

themproducingaresultidenticaltothatofapersonwho’sbeenwithus

forquitesometime.

“Asaddedinsurance,myRSPSupervisorsrunspotcheckseveryday

tomakecertainthatanyerrorsarecaughtintime.”

Hepausedandsmiled.“Buttherearerarelyanyerrors.Thesystem

workslikeacharm.

“There’sanequallyeffectivesystemforeverythingwedohere.The

factis,theownerworkeditalloutinadvance.Thelighting,thesauna,

andthepoolaretimedelectronicallyandsynchronizedwiththeseasons,

sothattheydeliverapredictableresulttotheguests.Forexample,you

mighthavenoticedthatatnighttheoutdoorlightsincreaseinintensityas

itgetsdarker.That’sdoneautomatically.Noonehastothinkaboutit.

“Icouldgiveyoulotsofotherexamples,butIthinkyougetthepoint.

Thewholethingwasputtogetherinawaytheownerbelievedwould

makeapositiveimpressiononourguests.You’dbeamazedathowmany

peoplecomeuptomeafterstayingherejusttothankmeforhowwell

theyweretreated.

“Butit’snotthebigthingstheytalkabout;it’salwaysthelittle

things.”

Icouldunderstandandbelieveallhehadsaid,butstillIasked,“How

doyougetyourRSPstousethechecklists?Howdoyougetthemtouse

thesystem?Don’ttheygettiredoftheroutine?Doesn’titgetboringfor

them?”

“Ah,”saidmywillinghost.

“That’swherewereallyshine.”

16YOURPEOPLESTRATEGY

Lifegamesreflectlifeaims.

RobertS.DeRopp

TheMasterGame

HowdoIgetmypeopletodowhatIwant?”ThisistheonequestionI

hearmostoftenfromsmallbusinessowners.

AndtheanswerIinvariablygivethemis,“Youcan’t!Youcan’tget

yourpeopletodoanything.

“Ifyouwantitdone,”Itellthem,“you’regoingtohavetocreatean

environmentinwhich‘doingit’ismoreimportanttoyourpeoplethan

notdoingit.Where‘doingit’wellbecomesawayoflifeforthem.”

Sincethatisthequestionmostoftenaskedofme,Iwasintriguedwith

thehotelManager’sanswertomyquestion,“Howdoyougetyourpeople

todowhatyouwant?”

HisresponsewasrefreshingbecauseitissorarethatIhear

somethinglikeit.

“ThefirstthingthatsurprisedmewhenIcametoworkhere,”the

Managersaid,“wasthattheownertookmeseriously.

“Imean,thinkaboutit.HereIwas,akid,withabsolutelyno

experienceinthisbusiness.Buthenevertreatedmethatway.Hetreated

measthoughIwereaseriousadult.Somebodyworthtalkingtoabout

whatheobviouslyconsideredimportant.

“AndthatwasthesecondthingthatsurprisedmewhenIcameto

workhere,”theManagercontinued.“HowseriouslytheBosstookthe

operationofthishotel.

“Imean,itwasn’tjustthathetookitseriously—everyoneI’veever

workedforwasseriousabouthisbusiness—itwasthekindofseriousness

hehad.

“Itwasasthoughthehotelwasmorethanjustahoteltohim.

“Itwaslikethehotelwasanexpressionofwhohewas,asymbolof

whathebelievedin.

“SoifIhadn’ttakenthehotelseriously,itwouldhavelookedlikeI

wasn’ttakinghimseriously,asamanwhosevaluesIrespected.

“Iguessthat’swhyhetookmeseriously.Itestablishedalevelof

communicationbetweenusthatmadeitpossibleformetolistentowhat

hebelievedinandhowthehotelexpressedthosebeliefsonaday-to-day

basis.

“I’llneverforgetmyfirstdayhere,”hewenton.“ItwaslikeIwas

beinginitiatedintoafraternityorsomething.

“Itwasrightherethatithappened.”Hewavedhisarminacircle

indicatingtheofficeinwhichweweresitting.“Thisusedtobehisoffice.

“Iwassittingwhereyou’resitting,”hesaid.“AndtheBosswassitting

here.”Hepointedatthechairinwhichhewassitting.

“ItwasaMondaymorningandtheyhadjusthadabigweekend,so

therewasatonofstufftodo.UsuallywhenIstartanewjob,thefirst

thingthathappensisthatthepersonwhohiresmetakesaminuteto

describewhatI’msupposedtodoandthenthrowsmeouttheretodoit.

SoIwassurprisedwhentheBossaskedmeifIwantedacupofcoffee.He

seemedsounhurried,sounbusinesslike,youmightsay.

“Nothatwasn’tit,”theManagercorrectedhimself.

“HewasprobablythemostbusinesslikepersonIhadevermet.

“Butitwashowhewasabouthisbusinessthatstruckme.

“Heseemedtobesayingthatwhatweweregoingtotalkaboutwas

themostimportantthingonhisagendathatday,thatdiscussingmyjob

wasmoreimportanttohimthandoingtheworkthatwasgoingonatthe

time.

“Hewasn’thiringmetowork;hewashiringmetodosomething

muchmoreimportantthanthat.”

TheManagersmiled.“Youknow,I’veneversaidthistoanyone

before.It’sreallystrange,butwhileI’mtellingyouallofthis,it’s

becomingcleartomewhyIhavesomuchrespectforthisplace.It’s

becauseIhavesomuchrespectfortheBoss.Tome,theplaceishim.IfI

didn’trespecthim,Idon’tthinkIwouldbeasgoodatwhatIdohereasI

am.Somehowtheideaofwhatwedohereishisidea.Andthat’swhathe

tooksolongtocommunicatetomeonthatfirstday—hisideaofthis

place.Andwhatthatmeanttohim.

“Whathetoldmewassomethingnobodyhaseversaidtomebeforein

anyjob.

“Hesaid,‘Theworkwedoisareflectionofwhoweare.Ifwe’resloppy

atit,it’sbecausewe’resloppyinside.Ifwe’relateatit,it’sbecausewe’re

lateinside.Ifwe’reboredbyit,it’sbecausewe’reboredinside,with

ourselves,notwiththework.Themostmenialworkcanbeapieceofart

whendonebyanartist.Sothejobhereisnotoutsideofourselves,but

insideofourselves.Howwedoourworkbecomesamirrorofhowweare

inside.’”

TheManagercontinued,asiftheownerweretalkingthroughhim.

“Workispassivewithoutyou.Itcan’tdoanything.Workisonlyanidea

beforeapersondoesit.Butthemomentapersondoesit,theimpactof

theworkontheworldbecomesareflectionofthatidea—theideabehind

thework—aswellasthepersondoingit.

“Intheprocess,theworkyoudobecomesyou.Andyoubecomethe

forcethatbreatheslifeintotheideabehindthework.

“Youbecomethecreatoroftheimpactontheworldoftheworkyou

do.

“Thereisnosuchthingasundesirablework,”hecontinued.“There

areonlypeoplewhoseecertainkindsofworkasundesirable.Peoplewho

useeveryexcuseintheworldtojustifywhytheyhavetodoworkthey

hatetodo.Peoplewholookupontheirworkasapunishmentforwho

theyareandwheretheystandintheworld,ratherthanasanopportunity

toseethemselvesastheyreallyare.

“WhattheBosssaidisthatpeoplelikethatdon’tbringlifetotheidea

oftheworktheydo;theybringdeathtoit.

“Theresultofthatisalwayswhatweexperienceasthesloppy,

inconsiderate,inconsistent,andinhumantransactionsthattakeplace

betweenmostbusinessesandthepeoplewhobuyfromthem.Exactlythe

oppositeofwhatwehavehere.

“Andthereasonit’sdifferenthereisbecausewegiveeveryonewho

comestoworkatthehotelanopportunitytomakeachoice.Notafter

they’vedonethework,butbefore.

“Andwedothatbymakingsuretheyunderstandtheideabehindthe

workthey’rebeingaskedtodo.

“Iguessthat’swhatexcitedmemostabouttakingthisjob,”saidthe

Manager.“It’stheveryfirstplaceI’veevergonetoworkwheretherewas

anideabehindtheworkthatwasmoreimportantthantheworkitself.

“TheideatheBossexpressedtomewasbrokendownintothreeparts:

“Thefirstsaysthatthecustomerisnotalwaysright,butwhetherheis

ornot,itisourjobtomakehimfeelthatway.

“Thesecondsaysthateveryonewhoworkshereisexpectedtowork

towardbeingthebesthecanpossiblybeatthetaskshe’saccountablefor.

Whenhecan’tdothat,heshouldactlikeheisuntilhegetsaroundtoit.

Andifhe’sunwillingtoactlikeit,heshouldleave.

“Thethirdsaysthatthebusinessisaplacewhereeverythingweknow

howtodoistestedbywhatwedon’tknowhowtodo,andthattheconflict

betweenthetwoiswhatcreatesgrowth,whatcreatesmeaning.

“TheideatheBosshasaboutthebusinesscomesdowntoone

essentialnotion.Thatabusinessislikeamartialartspracticehall,adojo,

aplaceyougotopracticebeingthebestyoucanbe.Butthetruecombat

inadojoisnotbetweenonepersonandanotherasmostpeoplebelieveit

tobe.Thetruecombatinamartialartspracticehallisbetweenthe

peoplewithinourselves.

“That’swhattheBossandItalkedaboutinourfirstmeeting.His

philosophyaboutworkandaboutbusiness.Icametounderstandthatthe

hotelwastheleastimportantthinginourrelationship.Whatwas

importantwashowseriouslyItooktoplayingthegamehehadcreated

here.

“Hewasn’tlookingforemployeessomuchasforplayersinhisgame.

Hewaslookingforpeoplewhowantedsomethingmorethanjustajob.”

WhattheManagerwastellingme,andwhattheBosshadtoldhim,

wasthatpeople—yourpeople—donotsimplywanttoworkforexciting

people.Theywanttoworkforpeoplewhohavecreatedaclearlydefined

structureforactingintheworld.Astructurethroughwhichtheycantest

themselvesandbetested.Suchastructureiscalledagame.

Andthereisnothingmoreexcitingthanawell-conceivedgame.

Thatiswhattheverybestbusinessesrepresenttothepeoplewho

createthem:agametobeplayedinwhichtherulessymbolizetheidea

you,theowner,haveabouttheworld.

Ifyourideaisapositiveone,yourbusinesswillreflectthatoptimism.

Ifyourideaisanegativeone,yourbusinesswillreflectthataswell.

Inthiscontext,thedegreetowhichyourpeople“dowhatyouwant”is

thedegreetowhichtheybuyintoyourgame.

Andthedegreetowhichtheybuyintoyourgamedoesn’tdependon

thembutonhowwellyoucommunicatethegametothem—attheoutset

ofyourrelationship,notafterit’sbegun.

YourPeopleStrategyisthewayyoucommunicatethisidea.

ItstartswithyourPrimaryAimandyourStrategicObjective,and

continuesthroughyourOrganizationalStrategy(yourOrganizationChart

andthePositionContractsforallofthepositionsinit)andthe

OperationsManualsthatdefinetheworkyourpeopledo.

Itiscommunicatedthroughthebeliefsyouhaveandthewayyou

expectyourPrototypetoexemplifythem;throughthestandardsyou

establishfortheperformanceofaccountabilitiesatalllevelsandinall

sectorsofyourPrototype;throughthewordsyouusetodescribewhat

yourbusinessneedstobecome—foryourcustomer,foryourpeople,for

yourself—ifitistobemorethanjustaplacewherepeoplegotowork.

Butthegameyourbusinesswillplaycan’tsimplybecapturedonthe

writtenpage.Itmustbeseenifitistowork.Itmustbeexperienced.

Itis—first,last,andalways—abouthowyouact.

Thewordswillbecomehollowifthegameisacontrivedone.

Thegamecan’tbecreatedasadevicetoenrollyourpeople.Itcan’t

becomecynicalifit’stoprovideyourpeoplewithwhattheyneedinorder

tocomealivewhileplayingit.

Thegamehastobereal.Youhavetomeanit.

Thegameisameasureofyou.

Howyouactinthegameestablisheshowyouwillberegardedbythe

otherplayers.

TheRulesoftheGame

Asinanygame,the“peoplegame”hasrulesthatmustbehonoredif

youaretobecomeanygoodatit.

I’veincludedafewheretogiveyouatasteforthem.Asfortherestof

them,you’llhavetodiscoverthemforyourselfbyplayingagameofyour

own.You’lllearntherulesintheprocess.

1. Neverfigureoutwhatyouwantyourpeopletodo

andthentrytocreateagameoutofit.Ifit’stobe

seenasserious,thegamehastocomefirst;whatyour

peopledo,second.

2. Nevercreateagameforyourpeopleyou’re

unwillingtoplayyourself.They’llfindyououtand

neverletyouforgetit.

3.Makesuretherearespecificwaysofwinningthe

gamewithoutendingit.Thegamecanneverend

becausetheendwilltaketheliferightoutofyour

business.Butunlesstherearevictoriesintheprocess,

yourpeoplewillgrowweary.Hence,thevalueofvictories

nowandthen.Theykeeppeopleinthegameandmake

thegameappealing,evenwhenit’snot.

4. Changethegamefromtimetotime—thetactics,

notthestrategy.Thestrategyisitsethic,themoral

underpinningofyourgame’slogic.Thismustremain

sacrosanct,foritisthefoundationofyouandyour

people’scommitmenttoeachother.Butchangeis

necessary.Foranygamecanbecomeordinary,nomatter

howexhilaratingitmaybeatthebeginning.

Toknowwhenchangeiscalledfor,watchyourpeople.

Theirresultswilltellyouwhenthegame’sallbutover.

Thetrickistoanticipatetheendbeforeanyoneelsedoes

andtochangeitbyexecutiveaction.You’llknowifyou’ve

pulleditoffbywatchinghoweveryonerespondstothe

change.Notatfirst,however.Youcanexpectsome

resistanceatfirst.Butpersist.Yourpersistencewillmove

themthroughtheirresistanceintoyournewandmore

enliveninggame.

5. Neverexpectthegametobeself-sustaining.

Peopleneedtoberemindedofitconstantly.At

leastonceaweek,createaspecialmeetingaboutthe

game.Atleastonceaday,makesomekindofissueabout

anexceptiontothewaythegamehasbeenplayed—and

makecertainthateveryoneknowsaboutit.

Remember,inandofitselfthegamedoesn’texist.Itis

alivetothedegreethatpeoplemakeitso.Butpeoplehave

theunerringabilitytoforgeteverythingtheystartandto

bedistractedbytrivia.Mostgreatgamesarelostthatway.

Tomakecertainyoursisn’t,don’texpectyourpeopleto

besomethingthey’renot.Remindthem,timeaftertime,

ofthegamethey’replayingwithyou.Youcan’tremind

themtoooften.

6. Thegamehastomakesense.Anillogicalgamewill

abortbeforeitevergetsgoing.Thebestgamesarebuilt

onuniversallyverifiabletruths.Everyoneshouldbeable

toseethemifthey’retobesufficientlyattractive.Agame

withmuddybeginningswillgetyounowhere.Knowthe

groundyoustandonandthenassembleyourarmament.

Soonerorlateryou’llneedit.Foragamethatisn’ttested

isn’tagameatall.

Butremember,youcanhavethebestreasonsintheworld

foryourgameandstillendupwithaloserifthelogicis

notsupportedbyastrongemotionalcommitment.Allthe

logicdoesisgiveyourpeopletherationalarmamentto

supporttheiremotionalcommitment.Iftheir

commitmentwanes,itmeansthatthey—andmostlikely,

you—haveforgottenthelogic.Sowheeloutthelogic

often.Makesureeveryoneremembersthegame’sraison

d’être.

7. Thegameneedstobefunfromtimetotime.Note

thatIsaid,fromtimetotime.Nogameneedstobefunall

thetime.Infact,agameisoftennofunatall.That’spart

ofthethrillofplayingagamewell:learninghowtodeal

withthe“nofun”partsoastoretainyourdignitywhile

fallingonyourface.

Atthesametime,funneedstobeplannedintoyour

game.Butmakecertainthatthefunyouplanisfun.Fun

needstobedefinedbyyourpeople.Ifit’sfuntothem,it

willwork.Butnottoooften,maybeonceeverysix

months.Somethingtolookforwardto,andsomethingto

forget.

8. Ifyoucan’tthinkofagoodgame,stealone.

Anyone’sideasareasgoodasyourown.Butonceyou

stealsomebodyelse’sgame,learnitbyheart.There’s

nothingworsethanpretendingtoplayagame.

TheLogicoftheGame

TothehotelManager,theBoss’sgamewasagoodone,sohelearned

howtoplayit.Itwasasimplegame,buteffective.Itwasbuiltonthe

followinglogic:

Mostpeopletodayarenotgettingwhattheywant.Notfromtheir

jobs,notfromtheirfamilies,notfromtheirreligion,notfromtheir

government,and,mostimportant,notfromthemselves.

Somethingismissinginmostofourlives.

Partofwhat’smissingispurpose.Values.Worthwhilestandards

againstwhichourlivescanbemeasured.Partofwhat’smissingisa

GameWorthPlaying.

What’salsomissingisasenseofrelationship.

Peoplesufferinisolationfromoneanother.

Inaworldwithoutpurpose,withoutmeaningfulvalues,whathavewe

tosharebutouremptiness,theneedyfragmentsofoursuperficialselves?

Asaresult,mostofusscrambleabouthungrilyseekingdistraction,in

music,intelevision,inpeople,indrugs.

Andmostofallweseekthings.

Thingstowearandthingstodo.

Thingstofilltheemptiness.

Thingstoshoreupourerodingsenseofself.

Thingstowhichwecanattachmeaning,significance,life.

We’vefastbecomeaworldofthings.Andmostpeoplearebeing

buriedintheprofusion.

Whatmostpeopleneed,then,isaplaceofcommunitythathas

purpose,order,andmeaning.

Aplaceinwhichbeinghumanisaprerequisite,butactinghumanis

essential.

Aplacewherethegenerallydisorganizedthinkingthatpervadesour

culturebecomesorganizedandclearlyfocusedonaspecificworthwhile

result.

Aplacewheredisciplineandwillbecomeprizedforwhattheyare:the

backboneofenterpriseandaction,ofbeingwhatyouareintentionally

insteadofaccidentally.

Aplacethatreplacesthehomemostofushavelost.

That’swhatabusinesscando;itcancreateaGameWorthPlaying.

Itcanbecomethatplaceofcommunity.

Itcanbecomethatplacewherewordssuchasintegrity,intention,

commitment,vision,andexcellencecanbeusedasactionstepsinthe

processofproducingaworthwhileresult.

Whatkindofresult?

Givingyourcustomerasensethatyourbusinessisaspecialplace,

createdbyspecialpeople,doingwhattheydointhebestpossibleway.

Andallbeingdoneforthesimplest,mosthumanreasonpossible—

becausethey’realive!

Whatotherreasondoyouneed?

Humanbeingsarecapableofperformingextraordinaryacts.Capable

ofgoingtothemoon.Capableofcreatingthecomputer.Capableof

buildingabombthatcandestroyusall.

Theleastweshouldbeabletodoisrunasmallbusinessthatworks.

Forifwecan’tdothat,thenwhat’sthevalueofourgrandideas?

Whatpurposedotheyservebuttoalienateusfromourselves,from

eachother,fromwhoweare?

PlayingtheGame

Thinkingthewaythehotelownerdid,youcanbegintoconstructa

mentalmapofthegamehecreated.Hishotelbecameaworldinwhich

thesensoryexperiencesofhiscustomerweregreetedbyaprofound

dedicationtocleanliness,beauty,andorder.

Butthisdedicationdidn’trestonapurelycommercialjustification

(thoughtherewasthattoo;nobusinesscouldbesuccessfulwithoutit)

butamoralone.OntheBoss’sphilosophy,hisviewoftheworld,hisidea.

Theideawasthencommunicatedtohispeople,bothinwordand

deed,throughawell-plannedprocess.

Theimportanceofthiscannotbeoverstated.

TheBosscommunicatedhisideathroughdocumentedsystemsand

throughhiswarm,moving,andpositivemanner.

Heknewthathecouldcommunicatetheorderlyyethumanprocessof

pleasingcustomerstohispeopleonlyifitwerecommunicatedtothemin

anorderlyandhumanway.

Inshort,themediumofcommunicationbecameasimportantasthe

ideaitwasdesignedtocommunicate.

Andthehotel’shiringprocessbecamethefirstandmostessential

mediumforcommunicatingtheBoss’sidea.

AstheManagerexplainedittome,thehiringprocesswascomprised

ofseveraldistinctcomponents:

1. AscriptedpresentationcommunicatingtheBoss’sideain

agroupmeetingtoalloftheapplicantsatthesametime.

Thispresentationdescribednotonlytheideabutalsothe

business’shistoryandexperienceinsuccessfully

implementingthatidea,andtheattributesrequiredofthe

successfulcandidateforthepositioninquestion.

2. Meetingwitheachapplicantindividuallytodiscusshis

reactionstoandfeelingsabouttheidea,aswellashis

backgroundandexperience.Atthismeeting,each

applicantwasalsoaskedwhyhefelthewassuperbly

appropriatefortherolethepositionwastoplayin

implementingtheBoss’sidea.

3. Notificationofthesuccessfulcandidatebytelephone.

Again,ascriptedpresentation.

4. Notificationoftheunsuccessfulapplicants,thankingeach

forhisinterest.Astandardletter,signedbythe

interviewer.

5. Firstdayoftrainingtoincludethefollowingactivitiesfor

boththeBossandthenewemployee:

ReviewingtheBoss’sidea

Summarizingthesystemthroughwhichtheentirebusiness

bringstheideatoreality

Takingthenewemployeeonatourofthefacilities,

highlightingpeopleatworkandsystemsatworkto

demonstratetheinterdependenceofthesystemsonpeople

andthepeopleonsystems

Answeringclearlyandfullyalltheemployee’squestions

IssuingtheemployeehisuniformandhisOperations

Manual

ReviewingtheOperationsManual,includingtheStrategic

Objective,theOrganizationalStrategy,andthePosition

Contractoftheemployee’sposition

Completingtheemploymentpapers

Andthehiringprocessisjustthebeginning!

Justthink.Allofthissimplytostartarelationship!

Areyoubeginningtounderstandthatsystematizingyourbusiness

neednotbeadehumanizingexperience,butquitetheopposite?

Thatinordertogetyourpeopletodowhatyouwant,you’llfirsthave

tocreateanenvironmentthatwillmakeitpossible?

Thathiringpeople,developingpeople,andkeepingpeoplerequiresa

strategybuiltonanunderstandingofpeoplecompletelyforeigntomost

businesses?

Thatthesystemisindeedthesolution?

Thatwithoutanideaworthpursuing,therecanbenoPeopleStrategy

atall?

Butwiththatideayoucanfinallysay,justasouryoungManagersaid,

“That’swherewereallyshine!”

Management,people,systems.AsIwatchedSarahtakeallthisin,Isaw

thattheideaofthisintegratedviewofbusinesshadbeguntotakeholdof

herimagination.

Gonewastheresistance,thedoubt,andthefearthatwhatIhad

broughttoherdoorwasbeyondher,somethingunreachableforthebaker

ofpiesshehadcometobelieveshewas.

Whatshewasbeginningtograspisthatshewasaworthyopponent,

moreworthythanshehadeverrealized,andthatthegameIwas

describingforherwasthesamegameshehadbeentaughttoplaybyher

aunt,yearsagoinhermother’skitchen,withsuchlovingattention.That

therewasabsolutelynodifference!

Shesmiledatme,asthoughreadingmythoughts.

“I’mbeginningtoseetheconnectionbetweenallthesethingswe’ve

talkedabout,”shesaid.“They’reallbeginningtomakesense.Thepuzzle

iscomingtogether.Icanseethepartsmergeintoanexcitingpicturethat

Inowknowhasbeenthereallalong!Allthatneededtobedoneforthe

picturetotakeformwasforsomeonetomovethepiecesintotheirproper

place.I’dliketodescribeitforyou,thepictureI’mbeginningtosee,

beforeIaskyousomemorequestions.”

“Gorightahead,”Ismiled.“Infact,I’dbedisappointedifyoudidn’t.”

“Itallgoesbacktomychildhood,ofcourse.TothespiritIspoke

aboutearlier.TowhatIfeltlikeasalittlegirl.AndIknownowthatI’m

notalone;thatI’mnottheonlyonewho’severfeltthatway.

“Thattherewereprobablylotsofotherlittlegirlsandboyswhowere

sufferingthesamesortofexperience.Andlotsofgrownmenandwomen

who,likeme,arestillcarryingaroundtheimpactoftheirearlychildhood

experiences.

“AndsoIseemyexperiences—thecorrallingofthewildhorse,the

stuffingawayofthespiritmyteachersandmyparentstrainedmetodo

sowell—asthebeginningofaphilosophyformybusiness,aphilosophy

thatmybusinessneedsifI’mevergoingtoofferanythingoftruevalueto

myemployeesandmycustomers.

“‘Therewillbenostuffingofthespirithere,’mybusinesswillsay.

MaybeIshouldputitupabovethedoortoremindeveryonewhocomes

inwhatourpurposeis.”Shegrinned.“Or,maybebetteryet,‘Letthyspirit

runfree!’Yes,that’sbetter.Itevenfeelsbetter.”Shelaughedaloudwith

thejoyofit.

Asshecontinued,itbecamesocleartomewhatamiraculousgift

speakingcanbe.

IsawthatSarahwasn’tsomuchtalkingtomebuttoherself,

discoveringasshespokethemiraclesthatlivedwithinher,withinher

experience,withinherrelationshipwithheraunt,withinher

extraordinaryimagination.Discoveringtruthssheneverknewsheknew.

Discoveringallthewealththatwaswaitingthereinsideofhertobe

unearthed,tobeexplored,tobetreasuredasthewordscametumbling

forth.

Asthoughthewords,oncefreedbythespeakingofthem,combined

withtheairtobecomesomethingelseagain.Avision.Understanding.

Expansion.

Sarahcontinued.

“Mypictureofthebusinessalsogoesbacktowhatmyaunttaughtme

aboutcaring.

“Ifmyauntwerealivetoday,shewouldsay,‘Ifeveryonecares,the

pieswilltakecareofthemselves!’

“AndsoIcanseemybusinessasaschool,aschoolaboutcaringthat

teachesallthelittlethingstomyemployeesthatmyaunttriedsohardto

teachme:Whatitmeanstopayattention.Whatitmeans—toourspirits!

—tobepresentwiththewholeofourselvesineverythingwedo.

“MyGod,IthoughtIhadn’tlearnedanything!”shesaidtome,her

eyeswidewiththeastonishmentofwhatshehadjustunderstood.

“ButIhad.Ihad.AndnowI’mgoingtotakeherplace.Thatlovely

woman.Thatsweet,gentle,determined,oldwoman.I’mgoingtotakeher

place.I’mgoingtobecomethemasterinmyownkitchen,justasshewas

themasterinhers.

“Andtherulesofthegame—whatajoyit’sgoingtobetocreatethem.

Rulesaboutdress.Rulesaboutcomportment.Rulesaboutthetoolswe

useandhowweusethem.Rulesaboutthefloorandthewallsandthe

counterspace,howwecleanthemeverynightandeverymorning,howwe

givethemtheirfinaltouchsothattheyabsolutelyglow!Rulesaboutthe

pietinsandaboutthecupboardsinwhichwestorethings.Rulesabout

glass,rulesaboutsilver,rulesabouttin.Rulesabouttheovens,how

they’reheated,howthey’reopenedandclosed,howthey’recleaned.Rules

aboutopeningup,andclosingup.Rulesaboutmoney,aboutkeepingthe

books,aboutbalancingattheendofeachday.Rulesabouthair,about

fingernails!”

Sarah’seyeswereflashingasshepouredoutthebeginningofher

vision,ashervisionbegantotakeshape.Shedidn’tneedtoknowwhat

thespecificruleswereyet;whatwasimportantwasthatshegetatasteof

theexercise.

Asherauntsaid,“Thepieswilltakecareofthemselves.”

Sarahwasonherway.

“Talktomemoreaboutmanagement,”Sarahsaid.“Iheardyousay

earlierthatIdon’tneedprofessionalmanagerstobesuccessfulinmy

business;that,infact,I’mbetteroffwithoutthem.What’swrongwith

hiringexperiencedmanagers?”

“Everything’swrongwithit,Sarah!

“Because,ifyoudon’tknowhowtomanage,howareyougoingto

choosethem,andhowareyougoingtomanagethem?

“Youcan’t!

“Becausetheywillmanagebythestandardstheyhavebeentaughtto

managebyinsomebodyelse’sbusiness.Notbyyourstandards.

“RememberDelegationratherthanAbdication?

“Youcan’tdelegateyouraccountabilities,Sarah.

“Delegatingyouraccountabilitiesisabdication.

“You,astheShareholder,astheowner,astheCOO,asthe

VP/Marketing,astheVP/Finance,whateverpositionsyoutake,must

takefullaccountabilityforwhat’sgoingoninyourbusiness.

“Andtodoso,youmustleadthecompanyinthedirectionyouintend

ittogo.

“Andthatmeansyoumustsetthestandard.

“Andoneofthemostimportantsetofstandardsyoumustestablishis

aManagementSystemthroughwhichallmanagers,andallthosewho

wouldbecomemanagersinyourcompany,areexpectedtoproduce

results.

“StandardssurroundingyourPrimaryAim.Yourcompany’sStrategic

Objective.Therulesofthegame.Thestoryyou’vebeentellingmeabout

yourauntandaboutherextraordinarykitchen.Andthestandardsthat

definethevisionyouholdinyourheart,andinyourhead,forthe

businesscalledAllAboutPiesthatyouintendtorealize!

“Youdon’tneedprofessionalmanagerstomanagetothosestandards.

Allyouneedarepeoplewhowishtolearnhowtomanagetothem.People

whoareaspersonallycommittedtothosestandardsasyouare!

“Inshort,youneedpeoplewhowanttoplayyourgame,Sarah.Not

peoplewhobelievetheyhaveabetterone.

“So,youneedtoinventtherulesofthegame,whichbecomethe

foundationofyourManagementSystem.

“Andoncehavingcreatedtheserules,oncehavingcreatedthisgame,

youneedtoinventthewaytomanageit.

“Becauseyourmanagersdon’tsimplymanagepeople;yourmanagers

managetheSystembywhichyourbusiness,AllAboutPies,achievesits

objectives.

“TheSystemproducestheresults;yourpeoplemanagethesystem.

“AndthereisaHierarchyofSystemsinyourbusiness.

“ThisHierarchyiscomposedoffourdistinctcomponents:

“Thefirstis,HowWeDoItHere.

“Thesecondis,HowWeRecruit,Hire,andTrainPeopletoDoIt

Here.

“TheThirdis,HowWeManageItHere.

“TheFourthis,HowWeChangeItHere.

“Andthe‘It’I’mreferringtoisthestatedpurposeofyourbusiness.At

FederalExpressit’s‘WhenYouAbsolutely,PositivelyHavetoGetIt

ThereOvernight!’

“The‘It’ofyourbusiness,Sarah,isCaring.

“HowdoyouexpressCaringwhenyouanswerthetelephone?

“HowdoyouexpressCaringwhenyoutakeapieoutoftheoven?

“HowdoyouexpressCaringwhenyoutakethemoneyfroma

customer?

“Andsoforthandsoon,ineverythingyoudoatAllAboutPies.

“AndyouranswertothosequestionsisHowYouDoItHere!Itisthe

sumtotalofeverythingyou’vecreated,everydistinctprocessfor

performingeverylittletaskatAllAboutPies.Everybitofwhichis

documentedinyourOperationsManuals.Everybitofwhichistaughtat

yourschool.Everybitofwhichismanagedto,andimprovedupon,and

discussedamongyouandyourpeopleforaslongasyou’reinbusiness!

That’swhat‘It’is.‘It’isyourBestWay.‘It’iswhatyoubelievein.‘It’is

whypeoplebuyfromyou,workforyou,lendtoyou,trustyou.

“Andjustasinthehotelwe’vevisited,itisthesystem,notonlythe

people,thatwilldifferentiateyourbusinessfromeveryoneelse’s.

“Imaginetryingtoproducesuchaconsistentresultwithoutsucha

system!

“Imagineeachmanagerineachofyourfuturefourstoresdoinghisor

herownthing.

“Howwouldanythingbecommunicatedconsistentlyinsucha

business,inwhicheveryformoflanguage,everyideaoforganization,

everykindofprocessandsystemwereexpressedinanindividualand

subjectivewaybyeachandeveryoneofyourpeople,withoutany

standards,withoutanyagreement,withoutanyconsistencyinform—in

fact,withoutanyconsistencyinjudgment?

“Isthatanappealingpicture?”Iasked.

“I’mexhaustedjustthinkingaboutit,”Sarahresponded.

“Iknow,anditisevenworsethanyoucanimagine.

“ButaManagementSystemissomethingelseagain.Andwhenitis

combinedwithawell-conceivedMarketingSystem…”

17YOURMARKETINGSTRATEGY

Whatwehavehereisafailuretocommunicate.

Anonymous

YourMarketingStrategystarts,ends,lives,anddieswithyour

customer.

SointhedevelopmentofyourMarketingStrategy,itisabsolutely

imperativethatyouforgetaboutyourdreams,forgetaboutyourvisions,

forgetaboutyourinterests,forgetaboutwhatyouwant—forgetabout

everythingbutyourcustomer!

Whenitcomestomarketing,whatyouwantisunimportant.

It’swhatyourcustomerwantsthatmatters.

Andwhatyourcustomerwantsisprobablysignificantlydifferent

fromwhatyouthinkhewants.

TheIrrationalDecisionMaker

Trytovisualizeyourcustomer.

He’sstandingbeforeyou.

He’snotfrowning;norishesmiling.Heisperfectlyneutral.Yet,

there’ssomethingstrangeabouthim.

Comingoutofhisforehead,reachinguptowardtheceiling,isan

antenna!Andattheendoftheantennaisasensor,beepingawaylike

crazy.

Andthesensoristakinginallofthesensorydataaroundit—the

colors,shapes,sounds,andsmellsofyourstore,oryouroffice,orthe

restaurantwhereyou’remeetingforlunch.

Thesensorisalsotakinginsensorydatafromyou:howyouare

standingorsitting,thecolorofyourhair,howyourhairiscombed,the

expressiononyourface—Isittense?Areyoulookingdirectlyathimoroff

totheside?—thecreaseinyourslacks,thecolorofyourshoes—Arethey

shined?Aretheyworn?Arethelacestied?

Nothingescapesthesensorasitabsorbsthestimulifromthe

environment.

Nothingescapesyourcustomerasheabsorbstheinformationheuses

tomakehisdecisiontobuyornottobuy.

Butthisstepinthebuyingprocessisonlythefirst.

It’swhatthesensordoeswiththeinformationthat’sofinteresthere.

Becauseit’showthesensorprocessestheinformationthatwill

determinethedecisionyourcustomerisabouttomake.

Thinkofthesensorasyourcustomer’sConsciousMind.

Itsjobistogathertheinformationneededforadecision.

Mostofwhatitdoes,however,isunconscious;thatis,automatic,

habitual.

Soeventhoughyourcustomer’sConsciousMindisactivelyabsorbing

allmannerandformsofimpressions,itistotallyunawareofmostof

them.

Itcandoit—literally—initssleep.

Infact,itcan’tstopdoingit!

Fortunately,theConsciousMinddoesn’tneedtobeaware.

Forit’snotyourcustomer’sConsciousMindthathastomakethe

decisions.

It’syourcustomer’sUnconsciousMind.

It’sinyourcustomer’sUnconsciousMindwherealltheactionis.

It’sinyourcustomer’sUnconsciousMindwherethesecondstepof

thebuyingprocesstakesplace.

Whatisyourcustomer’sUnconsciousMind?

It’slikeavast,dark,undergroundseainwhichamultitudeofexotic

creaturesswimabout,singleandinschools,silentlyseekingoutfood,

eachwithentirelydifferentneedsandtastes.

Thosecreaturesareyourcustomer’sexpectations.

Andtheseainwhichtheyswimisatrulyforeignplacetoyour

customer.

Hehasnoideawhat’sswimmingarounddownthere.What’slurking

behindsomesubterraneanrock.What’slyingstillandquietasastoneon

thebottom,waitingpatientlyanddeliberatelyforsomesweetmorselto

wanderby.

Butyoucanrestassuredthateverycreatureinthatsea—everyoneof

thoseexpectations—isaproductofyourcustomer’slife!

Ofhisreactions,perceptions,attitudes,associations,beliefs,opinions,

inferences,conclusions.Anaccumulationofallhisexperiencessincethe

instantofhisbirth(andforallweknow,beforeit)tothisverymoment

whenhestandsbeforeyou.

Andallhisexpectationsarenothingmoreorlessthanthemeans

throughwhichthesumofthemall—yourcustomer’spersonality—gets

fedwhatitneeds.

Thefooditneedscomesintheformofsensoryinputfromthe

ConsciousMind(the“surface”).

Andifthefoodiscompatiblewithitsexpectations,theUnconscious

Mindsays,“Yes.”

Andifthefoodisincompatiblewithitsexpectations,theUnconscious

Mindsays,“No.”

Andthatdecision,yesorno,ismadeattheinstantitgetsataste!

Inatelevisioncommercial,we’retold,thesaleismadeorlostinthe

firstthreeorfourseconds.

Inaprintad,testshaveshown,75percentofthebuyingdecisionsare

madeattheheadlinealone.

Inasalespresentation,datahaveshownus,thesaleismadeorlostin

thefirstthreeminutes.

Andallthathappensafterthatpsychographicmomentoftruth,after

thebuyingdecisionismade,isthattheUnconsciousMindsendsits

answeruptotheConsciousMind,whichthengoesbackoutintothe

worldtoassembletherationalarmamentitneedstosupportitsalready

determinedemotionalcommitment.

Andthat’showbuyingdecisionsaremade.

Irrationally!

Ifanyonecaredtodoit,itcouldprobablybeprovedthatnooneyet

hasevermadearationaldecisiontobuyanything!

Sowhenyourcustomersays,“Iwanttothinkaboutit,”don’tyou

believehim.

He’snotgoingtothinkaboutit.

Hedoesn’tknowhow.

He’salreadydoneallthe“thinking”he’sgoingtodo—heeitherwants

itornot.

Whatyourcustomerisreallysayingisoneoftwothings:heiseither

emotionallyincapableofsayingnoforfearofhowyoumightreactifhe

toldyouthetruth,oryouhaven’tprovidedhimwiththe“food”his

UnconsciousMindcraves.

Eitherway,littleornothoughtentersintothetransaction.

Despitewhatwewouldliketobelieve,thedecisionwasmade

unconsciouslyandinstantaneously.

Infact,itwasmadelongbeforeyouevermet.

Butyourcustomerdidn’tknowit.

TheTwoPillarsofaSuccessfulMarketingStrategy

Thequestionthenbecomes:Ifmycustomerdoesn’tknowwhathe

wants,howcanI?

Theansweris,youcan’t!

Notunlessyouknowmoreabouthimthanhedoesabouthimself.

Notunlessyouknowhisdemographicsandhispsychographics.

Demographicsandpsychographicsarethetwoessentialpillars

supportingasuccessfulmarketingprogram.

Ifyouknowwhoyourcustomeris—demographics—youcanthen

determinewhyhebuys—psychographics.

Andhavingdoneso,youcanthenbegintoconstructaPrototypeto

satisfyhisunconsciousneeds,butscientificallyratherthanarbitrarily.

Again,demographicsisthescienceofmarketplacereality.Ittellsyou

whobuys.

Psychographicsisthescienceofperceivedmarketplacereality.Ittells

youwhycertaindemographictypesbuyforonereasonwhileother

demographictypesbuyforanother.

Letmegiveyouanexampleofhowthesesciencesmightbeutilizedin

yourMarketingStrategy.

Noticetheshadeofblueonthejacketofthisbook.Icallit“IBM

Blue.”Why?Becauseit’sIBM’scolor.That’swhy,Iimagine,IBMiscalled

“BigBlue”inthemarketplace.

Whythatspecificshadeofblueratherthananother?Whyblueatall?

Becausethatshadeofbluehasanextraordinarilyhighappealand

preferencetoIBM’sCentralDemographicModel.

Theyseethatshadeofblue,andit’sloveatfirstsight!

Everheardtheexpression,“TrueBlue”?That’swhatthatparticular

coloris:thecolorIBM’sCentralDemographicModelconsumerknowsit

candependon.

WhatdoyouthinkwouldhavehappenedhadIBMchosenorange

insteadofblue?

Well,sinceorangeisattheoppositeendofthepreferentialspectrum

forIBM’sconsumer,theIBMsuccessstorymaynothavebeenso

momentous.It’shardtoimagine“BigOrange”insteadof“BigBlue.”I

thinkIBM’scustomerwouldhavehadtroublebuyinganorange

computer!

Now,Iknowthatsoundsridiculous,butyoucantestitifyoulike.

RememberthelittletestIsuggestedearlierinthisbook,theonewith

thenavybluesuit?

I’dlikeyoutovisualizesomeonewearingsuchasuit.

Canyouseehiminyourmind’seye?

Deepnavyblue,ventsintheback,possiblyapinstripe.Sharply

creasedtrousers.Whitestarchedshirt.Aredandbluestripedtie.Black,

highlypolishedwing-tipshoes.

Nowhowdoyoufeelabouthim?

Doeshelookbusinesslike?

Doeshelooklikesomeoneyoucantrust?

Doesheappeartorepresentsomethingsolid,reliable,dependable?

Ofcoursehedoes.

Researchshowsthatthenavysuitisperhapsthemostpowerfulsuita

personcanwearinbusiness.Instantimpact.

Nowvisualizetheverysamepersonyoudidbefore,butthistimehe’s

notwearinganavybluesuit.

Nowhe’swearinganorangesuit.

That’sright,atwo-pieceorangesuit!

Anexpensiveoneatthat.

Andwithit,he’swearingawhite-on-whitesilkshirtandagreenand

whitestripedItaliansilktie.

Andasilverbeltbucklewithhisinitialsingreenjadeacrossitsface.

Andadiamondtiepin,twocarats,glimmeringoutatyoujustabove

thetopbuttonofhisvest.

Andproudlypeekingoutofhisfinelycreasedorangepants,an

incomparablepairofwhitelizardcowboyboots!

Canyouseeit?

Doyougetthepicture?

Well,youbettertakeitfastbecausehe’soutofbusiness!

Andwhat’simportanttoknowisthatthedifferencebetweenthetwo

menisn’tinthem—it’sinyourmind.

YourUnconsciousMind.

What’smore,thedifferenceisperceivedinstantlywithoutamoment

ofthought.

Thefactthatyoucouldn’tconductseriousbusinesswiththemanin

theorangesuitbutyoucouldifhewerewearingbluesaysthatthereisno

suchthingasreality.Atleastasweunderstandit.

Realityonlyexistsinsomeone’sperceptions,attitudes,beliefs,

conclusions—whateveryouwishtocallthosepositionsofthemindfrom

whichallexpectationsarise—andnowhereelse.

Sothefamousdictumthatsays,“Findaneedandfillit,”isinaccurate.

Itshouldsay,“Findaperceivedneedandfillit.”

Becauseifyourcustomerdoesn’tperceiveheneedssomething,he

doesn’t,evenifheactuallydoes.

Getit?

Thoseperceptionsareattheheartofyourcustomer’sdecision-

makingprocess.

Andifyouknowhisdemographics,youcanunderstandwhatthose

perceptionsare,andthenfigureoutwhatyoumustdotosatisfythemand

theexpectationstheyproduce.

Youcanknowyourcustomer’spsychographicreality.

Eachdemographicmodelhasaspecificsetofperceptionsthatare

identifiableinadvance.

Womenofacertainage,withacertainamountofeducation,witha

certainsizefamily,livinginacertaingeography,buyforveryspecific

psychographicreasons.

Thoseunconsciouslyheldreasonswillbedifferentfromanother

groupofwomen,ofadifferentageandmaritalstatus,withadifferent

educationalbackground,livinginadifferentpartofthecountry.

Andthesedifferencespredeterminewhateachgroupbuys.

Areyoubeginningtogetasenseofthecomplexityofthisbusiness

calledmarketing?Ihopeso.

Becauseuntilyoudo,untilyoubegintotakeitseriously,untilyou

giveittheearnestattentionitdemands,yourPrototypewillcontinueto

betheonlythingitcouldhopetobeunderthecircumstances—acrap

shoot!

AtGERBERBusinessDevelopmentCorporation,wehavecreated

toolsforoursmallbusinessclientstobegintheoftenarduoustaskof

makingdemographicandpsychographicdeterminations,andhowto

positiontheirPrototypeinthemindoftheirconsumer.Theimpacthas

beenastonishing.

Smallbusinessesthatactedlikesmallbusinesseswhenwemetthem

begantooperatewithintelligence.

Theircustomerscamevividlyalivetothem,oftenfortheveryfirst

time.

Inquiry,theactivesolicitationofspecificinformation,andcontrolled

experimentationreplacedtheguessing,blindhope,andfeverishbusy

workthatprecededthem.

Innovation,Quantification,andOrchestrationbecamethedriving

forcesbehindtheirefforts.

Thefactis,anysmallbusinesscandoit.Andeverysmallbusiness

must!

IfMaturebusinesses,suchasIBM,McDonald’s,FederalExpress,and

Disney,takesuchthingsseriously,thenhowcanyounotdothesame?

Yourbusinessisfarmorefragilethanabigbusiness.

Soifanything,youmusttakemarketingmoreseriouslythanabig

businessdoes.

Andtimeisrunningout.

Wehaveenteredthe“unforgivingage.”

Anageinwhichcountlesssmallbusinesseswilleitheracceptthe

challengeofaninformation-gluttedsocietyorbedestroyedbyit.

Anageinwhichyourcustomerisdelugedbysomanyproductsand

promisesthathebecomesswampedinconfusionandindecision.

Thechallengeofourageistolearnourcustomer’slanguage.Andthen

tospeakthatlanguageclearlyandwellsothatyourvoicecanbeheard

abovethedin.

Becauseifyourcustomerdoesn’thearyou,he’llpassyouby.

Nodoubtyoufeelfrustratedasyoureadthis.Youmustbeasking

yourself:HowdoIdoit?HowdoIdeterminemycustomer’s

demographics,hispsychographics?Whatcolorstouse?Whatshapes?

Whatwords?

Butifyou’reaskingthosequestions,you’rewellonyourway!

Forthepurposeofthisbookisnottoanswerthosequestionsbutto

raisethem!

Not“howtodoit”but“whatneedstobedone.”

Unlessyouunderstandwhatneedstobedone,unlessyouunderstand

theessentialimportanceofmarketingtoyourPrototype,unlessyou

understandthatyourcustomerisfarlessrationalinhisconvictionsand

expectationsthanyouhadeverimagined,unlessyouunderstandthat

yourPrototypeisyourproduct—allthe“howtodoit”intheworldwon’t

makeabitofdifferencetoyou.

Butwe’renotfinishedyet.

WehaveonemoresteptotakeinyourBusinessDevelopment

Program.

YourSystemsStrategy,thegluethatholdsyourPrototypetogether.

“Iknowyoudon’twanttotalkabout‘howtodoit,’”Sarahsaid,squinting

hereyesformockemphasis,“butifyouwanttoleavethistablealive,

you’regoingtohavetogivememorethanthat!”

“HowdoIdeterminethedemographicsandpsychographicsofmy

mostimportantcustomer?”sheimploredme.

“Well,”Ibegan,“let’sstartwhereyouare.Whatwealreadyknow

aboutyourbusinessisthatit’sattractingsomeonetoit.Thatthepicture

youhaveinyourmindabouttheAllAboutPiesyouwishtocreateisn’t

thatforeignfromtheoneyou’vecreated.Thatwhileyoudidn’tclearly

formulatetheideasatthebeginningofyourbusiness,wenowknowthat

yourinnerEntrepreneurwasbusyallthesame.ThattheCaringyouwish

toexpressintheAllAboutPiesofthefuturewasinyouallthetime.It’s

expressedtodayinthedeliciousqualityofyourpies,thebeautyofyour

shop,and,Imightadd,thelovely,albeitfrazzled,stateofyourbeing.”

Shesnortedquietlyinresponse,andIwenton.

“So,Ibelieveit’ssafeforustoassumethatthepeoplecominginyour

doortodayareunconsciouslyexpressingtheirpreferencefortheCaring

youhavesoeloquentlysharedwithme.They’rebuyingitevennow!

“Thefirstquestionyoumustask,then,is:Whoarethey?

“Whoaremycustomers,specifically?WhatistheirDemographic

Profile?

“Howdoyouanswerthatquestion?Youaskthem!

“Youaskeachandeveryoneofthem,byhavingthemcompletea

questionnaireinreturnforafreepie!

“Thefreepieisthepriceyoupayforthatinformation.

“Theanswersyougetwillprovetobeabonanza!

“But,whileyou’reatit,youmightaswellgetthepsychographicdata

youneed,aswellasthegeographicdatayouneed.

“Howdoyoudothat?Youfindoutonyourquestionnairewhatcolors

theyprefer,whatshapes,whatwords.Youfindoutthebrandsofperfume

theybuy,automobiles,clothes,jewelry,food.Youmatchthosebrandsto

theadsandcommercialsthatsellthem,andyoudiscoverbybecoming

interestedinwhatmessagesarebeingsenttoyourcustomersbyother

companies—whoaresuccessfullysellingtothem—whatmessagesyou

mightsendtothosecustomers,whoaredemographicallyand

psychographicallythesameasyourexistingCentralDemographicModel,

tointentionallycomeinyourdoor.

“Howdoyoufindthem,thosepeopleyouhavenotyetmet?Youbuya

listofthosewhofityourCentralDemographicModelinwhatyou’venow

determinedtobeyourTradingZone!

“What’syourTradingZone?It’sthegeographicperimeterwithin

whichyourcurrentcustomersmainlylive.Youtaketheiraddressesfrom

yourquestionnaire,identifythemonamap,drawalinearoundthem,

andthat’syourfirst-passTradingZone.

“Youthenbuyalistofdemographicallycorrectpeoplelivinginthat

area.

“Isthatenough‘howtodoit’fornow?”IaskedSarahwithmock

impatience.“Willthatkeepyoubusyforawhile?

“Becauseifitis,I’dliketogobacktothe‘whattodo’foraminute.

There’salotmoretoitthanmeetstheeye.”

“Thismarketingthingisn’tnearlyascomplicatedasImighthavemadeit

seem,”Icontinued.“Butit’simportantthatyoutakeitseriously.Because

itmostoftenisregardedbysmallbusinessownersasmerely‘good

commonsense.’AndIhaveseenmoreoftenthannotthattheonly

definitionof‘goodcommonsense’is‘myopinion.’Thatmostsmall

businessowners,sufferingastheydofromwhatI’vecometocall‘willful

disinformation,’simplydecidewhattheywanttodowithoutany

informationatall,withoutanyinterestinwhat’strue,andthensimplydo

it.Stationerydesignedbythelocalquick-printerwithalogothrownin.

Colorspickedbytheirwives.Signsdesignedbythelocalsignguywhose

experienceisinpaintingsigns,notindeterminingwhatcolorsand

shapesarepsychographicallycorrect.

“Inshort,Sarah,whileyoudon’thavetogooverthescientificdeep

end,youdohavetobesensitivetothescienceofthemarketingart.You

havetobeinterestedinit.Infact,youhavetobeinterestedineverything

yourbusinessneeds.Youhavetobecomeastudentoftheartofbusiness

andthescienceofbusiness.Andthat’sthe‘whattodo’partofallthis.Do

yourealizehowmuchmarketingmoneyisspentbycompanieslike

McDonald’s,FederalExpress,Disney,andWalmarttogetitjustright?

DoyourealizehowmuchtimeandattentioncompanieslikePepsicoand

AmericanExpressspendtogettheirbrandsjustright?Andhoweasyitis

tomissthemark?Andwhatitcoststhemiftheydo?

“Inasmallbusinessyousimplycan’taffordtospendthemoneythey

do.Butyoucanaffordtospendthetime,thethought,theattention,on

thesamequestionstheyask.

“Andthat’swhyIkeepongoingbacktothetrueworkofthesmall

businessowner—thestrategicworkratherthanthetacticalwork.Because

ifyou’redoingtacticalworkallthetime,ifyou’reworkingallthetime

devotingallyourenergyinyourbusiness,youwon’thaveanytimeor

energylefttoask,letaloneanswer,alloftheabsolutelycriticalquestions

youneedtoask.You’llsimplyhavenotimeorenergylefttoworkonit.

“Theownerofthebusinessmuststartoutbyaskingmarketing

questions.

“TheCOOmustcontinuetoaskmarketingquestions.

“TheVP/Marketingisabsolutelyaccountableforaskingmarketing

questions.

“Infact,thereisn’tafunctionorpositionwithinthecompanythatis

freeofaskingmarketingquestions,ifbymarketingwemean,‘Whatmust

ourbusinessbeinthemindofourcustomersinorderforthemtochoose

usovereveryoneelse?’

“Andso,seenfromtheappropriateperspective,theentirebusiness

processbywhichyourcompanydoeswhatitdoesisamarketingprocess.

“Itstartswiththepromiseyoumaketoattractthemtoyourdoor.

“Itcontinueswiththesaleyoumakeoncetheygetthere.

“Anditendswiththedeliveryofthepromisebeforetheyleaveyour

door.

“InsomecompaniesthatprocessiscalledLeadGeneration,Lead

Conversion,ClientFulfillment.

“Inyourbusiness,Sarah,it’scalledMarketing,Sales,andOperations.

“Butwhateveryoucallit,itistheessentialkeyprocessthatruns

througheverybusiness.

“Anditishowwell-integratedthatprocessis,howtotallyand

completelyconnectedeachpartoftheprocessappearsinrelationtothe

restoftheprocess,thatwilldeterminehowsuccessfulyouareatgetting

themtocomebackformore.

“AnditisgettingthemtocomebackformorethatisthePrimaryAim

ofeverybusiness.

“BecausewhatMcDonald’sknows,andwhatFederalExpressknows,

andwhatDisneyknows—indeed,whateveryextraordinarybusiness

knows—isthatthecustomeryou’vegotisonehellofalotlessexpensive

toselltothanthecustomeryoudon’thaveyet.

“Andthat’swhythebusinessprocessofLeadGeneration,Lead

Conversion,andClientFulfillmentissocriticaltothegrowthofyour

business.Andthat’swhatmarketingis.Thewholeprocess.Notjustapart

ofitbuttheentirething.

“Anditneverstops!

“Andso,whiletheVP/MarketingandtheVP/Operationsandthe

VP/Financeeachhavetheirownspecificaccountabilities,theyshareone

commonpurpose—tomakeapromisetheircustomerwantstohear,and

todeliveronthatpromisebetterthananyoneelseontheblock!

“AndtheplacewheretheyjoineachotherisatthepositionofCOO.

TheCOOisthedriverofallthis.TheCOOconnectseachpartofthe

businessprocess.TheCOOmaintainstheintegrityofthewholebyacting

asthearbiteroftheStrategicObjectiveheisaccountableforfulfilling,of

therulesofthegameheisaccountableformaintaining,ofthegamethe

businesshaschosentoplay.

“Anditisthere,atthatpointinthemiddle,whereHierarchyand

Processmeet.

“Itisthere,atthatpointinthemiddle,thatyourbusinesscomes

together.

“Itisthere,atthatpointwhereyourManagementSystemandyour

BusinessDevelopmentProcessplayouttheirrespectiverolessovividly.

“Itisatthatpoint,thepointIhavecalledthePowerPointinan

earlierbook,thatabusinesstrulybecomesalive.

“Wherethestaticanddynamicnatureofeverygreatbusinessmeets.

‘Thisishowwedoithere,’andthen,‘Thisishowwedoithere,’andthen,

‘Thisishowwedoithere,’overandover,andstilloveragain.

“Continuousimprovement.

“Electrifying,ecstatic,alive.

“Todowhat?

“Todeliverthepromisenooneelseinyourindustrydarestomake!

“That’swhatmarketingis,Sarah.That’swhatyourbusinessmustbe.

Alive,growing,committedtokeepingapromisenocompetitorwould

daretomake.

“That’swhatneedstobedone.Areyoureadytodoit?”

“Justwatchme,”Sarahsaid.

“Thenlet’sgoontothelastpartandtieitalltogether,”Isaid.

“Let’stakealookatSystems,andtheabsolutelyessentialrolethey

play.”

18YOURSYSTEMSSTRATEGY

Theworldthusappearsasacomplicatedtissueofevents,inwhich

connectionsofdifferentkindsalternateoroverlaporcombineand

therebydeterminethetextureofthewhole.

WernerHeisenberg

PhysicsandPhilosophy

ThroughoutthisbookIhavetalkedaboutsystemswithoutreally

definingwhatasystemis.Soletmedothathere.

Asystemisasetofthings,actions,ideas,andinformationthatinteract

witheachother,andinsodoing,alterothersystems.

Inshort,everythingisasystem.Theuniverse,theworld,San

FranciscoBay,theofficeI’msittingin,thewordprocessorI’musing,the

cupofcoffeeI’mdrinking,therelationshipyouandIarehaving—they’re

allsystems.

Somesystemswecanunderstandandsomewecan’t.

Let’stakealookattheoneswecan.

Thesystemsinyourbusiness.

ThreeKindsofSystems

Therearethreekindsofsystemsinyourbusiness:HardSystems,Soft

Systems,andInformationSystems.

HardSystemsareinanimate,unlivingthings.MycomputerisaHard

System,asarethecolorsinthisoffice’sreceptionarea.

SoftSystemsareeitheranimate—living—orideas.YouareaSoft

System;soisthescriptforHamlet.

InformationSystemsarethosethatprovideuswithinformation

abouttheinteractionbetweentheothertwo.Inventorycontrol,cashflow

forecasting,andsalesactivitysummaryreportsareallInformation

Systems.

TheInnovation,Quantification,Orchestration,andintegrationof

thesethreekindsofsystemsinyourbusinessiswhatyourBusiness

DevelopmentProgramisallabout.

Whatfollowsareexamplesofeach,andhowtheyintegratetoproduce

adesirableresult.

HardSystems

AtE-MythWorldwide,weusedtouse“whiteboards”extensivelyin

seminars,internalmeetings,andconferenceswithclientsandprospective

clients.Sincethevastmajorityofourworkwithclientsisdoneby

telephone,fax,andmail—ratherthaninourfacilitiesaswedidwhenThe

E-Mythwasfirstpublishedin1986—wehavefewsuchmeetingstoday.

Asyou’veprobablyguessedbynow,ourfacilitieswereoperated(and,

ofcourse,stillare)underrigidstandardsofcolorandcleanliness.

Colorstandardsatthetimedictatedthatweusewhiteboards,rather

thanblackones,andbluemarkers,ratherthanwhitechalk.

Unfortunately,ourcolorstandardsalsodictatedthatourwallsbewhite.

Itwasn’tlongbeforeaconflictdevelopedbetweenourstandardsof

cleanlinessandourstandardsofcolor.

Attheendofaseminar,ameeting,oraconference,theperson

accountableforthatparticulareventwastoleavetheroomintheorderin

whichhefoundit.Thisincludedcleaningtheboard-work,whichwasnot

ouremployees’favoritejob.

Notthattheywouldn’tdoit;theywould.Butintheirhastetogetit

donesotheycouldgetonwiththeworktheypreferredtodo,theeraser

wouldoftenflyuncontrollablyovertheedgeoftheboard.

Itwasn’tlongbeforeouroncegleamingwhitewallsbegantoshow

uglystreaksandsmudgesofIBM-blueink!

Itdroveuscrazy.

Wemountedanall-outcampaign.

WeheldBlueInkOntheWallsMeetings.

Wewrotememosentitled:

TO:AllPersonnel.

SUBJECT:BlueInkonWalls.

WecreatednewBoardCleaningPolicies.WecreatedCleaningTeams.

WecreatedWallTours.WecreatedBoardSpotChecks.Weinstalled

signsaboveeveryboardsaying:BECAREFUL!

Butnomatterwhatwedid,nomatterhowhardwetried,nomatter

whatwesaidtoournormallymeticulouspeople—blueinkgotonthe

walls.Ouronlyapparentrecoursewastopaintthewallswhiteoverand

overagainorgobacktoblackboardsandwhitechalk.

Neitherwasacceptable.

Andthat’showourPrevent-a-SmudgeSystemwasborn.

Wehadonestandardthatinsistedonimpeccablycleanwallsand

anotherstandardthatmadethefirstoneseeminglyimpossibletouphold

(whiteboards,whitewalls,blueink).Inshort,wehadaconflictbetween

whatwewantedandwhatwehad.

Thetwonecessarycomponentsofconflict.

Theessentialconditionsforinnovation.

Theconditionsthatgivebirthtoasystem.

Butathirdcomponentwasneededtotranslatetheconflictwewere

experiencingintoremedialaction:will.

Weweredeterminedtolicktheproblem,andwouldnotrestuntilwe

had.

Willappliedtoanyconflictcreatesenergy.

Conflictwithoutwillcreatesfrustration.Anengineturning,butgoing

nowhere.

Conflictwithwillcreatesresolution,amovementbeyondthe

dilemma.

Voilà!TheE-MythWorldwidePrevent-a-SmudgeSystem!

Itwassoobvious.Sosimple.

WeinstalledaclearLucitecollararoundeachboard.

Extendingfourinchesoutfromeachedgeoftheboard,theLucite

collarliterallystoppedtheblueinkcarnageinitstracks!

Inonefellswoop,thewallswereclean.

Ourpeopleweredelighted;ourclientsamazed.

Theconstantpainting,memowriting,signcreating,teaminvading,

policypollutingactivitiesthathadpervadedourorganizationformore

thanthreeweekswerehistory.

Andallbecauseofafour-inchLucitecollar!

AHardSystemforproducingahumanandtotallyintegratedresult.

Asystemsolutiontoatypicallypeople-intensiveproblem.Without

anyonehavingtopayattentiontoit.Leavingmefreetowritethisbook,

oranythingelseIcaredtodo.

Afterall,that’sthepurposeofasystem—tofreeyoutodothethings

youwanttodo.

SoftSystems

Thingsneedtobesold.

Andit’susuallypeoplewhohavetosellthem.

Everyoneinbusinesshasheardtheoldsaw:80percentofoursales

areproducedby20percentofourpeople.

Unfortunately,fewseemtoknowwhatthe20percentaredoingthat

the80percentaren’t.

Well,letmetellyou.

The20percentareusingasystem,andthe80percentaren’t.

AsellingsystemisaSoftSystem.

AndI’veseensuchsystemsproduce100percentto500percent

increasesinsalesinalmostnotime!

Whatisasellingsystem?It’safullyorchestratedinteractionbetween

youandyourcustomerthatfollowssixprimarysteps:

1. IdentificationofthespecificBenchmarks—orconsumer

decisionpoints—inyoursellingprocess.

2. Theliteralscriptingofthewordsthatwillgetyoutoeach

onesuccessfully(yes,writtendownlikethescriptfora

play!).

3. Thecreationofthevariousmaterialstobeusedwitheach

script.

4. ThememorizationofeachBenchmark’sscript.

5. Thedeliveryofeachscriptbyyoursalespeopleinidentical

fashion.

6. Leavingyourpeopletocommunicatemoreeffectively,by

articulating,watching,listening,hearing,acknowledging,

understanding,andengagingeachandeveryprospectas

fullyasheneedstobe.

AtE-MythWorldwide,wecallitthePowerPointSellingSystem.

Acareerdevelopmentcompanyweworkedwithputitinthehandsof

peoplewithnoexperience,andrevenuesincreased300percentinone

year.

Anadvertisingagencyputitinthehandsofpeoplewithnoexperience

ineithersellingoradvertising,andrevenuesincreased500percentin

twoyears.

Ahealthspaputitinthehandsofpeoplewithnoexperience,and

revenuesincreased40percentintwomonths.

Ifyouputittoworkinyourcompany,itwilldothesameforyou,no

matterwhatkindofbusinessyou’rein.

ThePowerPointSellingSystemiscomposedoftwoparts:Structure

andSubstance.Structureiswhatyoudo.Substanceishowyoudoit.

TheStructureoftheSystemisallofthepredeterminedelementsof

theProcess,andincludesexactlywhatyousay,thematerialsyouuse

whenyousayit,andwhatyouwear.

TheSubstanceoftheSystemiswhatyou—thesalesperson—bringto

theProcess,andincludeshowyousayit,howyouuseitwhenyousayit,

andhowyouarewhenyousayit.

StructureandSubstancemergeinthesellingprocesstoproduceafar

moreextraordinaryresultthananysinglesalespersoncouldiflefttohis

owndevices.

Let’slookmorespecificallyatthemostimportantcomponentofthe

PowerPointSellingSystem—whatyousay.OrwhatwecallatE-Myth

Worldwide,thePowerPointSellingProcess.

THEPOWERPOINTSELLINGPROCESS

ThePowerPointSellingProcessisactuallyaseriesofscriptsdefining

theentireinteractionbetweenthesalespersonandthecustomer.

Thesescripts(orBenchmarks)are:

1. TheAppointmentPresentation

2. TheNeedsAnalysisPresentation

3. TheSolutionsPresentation

THEAPPOINTMENTPRESENTATIONMostsalespeoplefailat

theoutsetofthesellingprocessbecausetheydon’trealizethepurposeof

anAppointmentPresentation.

MostbelievethatthepurposeofanAppointmentPresentationisto

qualifythecustomerandascertainwhetherornotheisaviableprospect.

It’snot.

ThepurposeofanAppointmentPresentationisonethingandone

thingonly:tomakeanappointment.

TheAppointmentPresentationmovestheprospectfromwhereheis

tothesecondBenchmarkintheprocess,theNeedsAnalysisPresentation.

Itisaseriesofwords,deliveredonthetelephoneorinperson,that

engagetheprospect’sunconscious(remember?)byspeakingprimarily

abouttheproductyouhavetosellratherthanthecommodity.

Forexample:

“Hi,Mr.Jackson.I’mJohnnyJoneswithWalterMittyCompany.Have

youseentheremarkablenewthingsthatarebeingdonetocontrol

moneythesedays?”

“Whatnewthings?”

“Well,that’sexactlywhyIcalled.MayIhaveamomentofyour

time?”

Theproduct?Financialcontrol.Controlisthekey.Thepresentation

tellsMr.Jacksonthattherearethingsgoingonintheworld

—“remarkablenewthings”—thathedoesn’tknowabout(he’soutof

control),buthecannowbecomefamiliarwiththem(gaincontrol!)by

justspendingafewmomentswithJohnnyJones.

Andittellshimthatinstantly!Mr.Jackson’semotionalcommitment

isalreadymade.Allthatheneedsnowistofindtherationalarmamentto

supportit.That’swhatJohnnyJones’sjobis.That’swhytheappointment

willbemade.

Simpleandeffective.Itmakesappointments.

Todowhat?

TodelivertheNeedsAnalysisPresentation.

THENEEDSANALYSISPRESENTATIONThefirstthingyoudo

inaNeedsAnalysisPresentationisrepeatwhatyousaidinthe

AppointmentPresentationtoreestablishtheemotionalcommitment:

“Remember,Mr.Jackson,whenwefirsttalkedImentionedthatsome

remarkablenewthingsweregoingonintheworldtocontrolmoney?”

Thesecondthingyoudoistelltheprospecthowyouwouldliketo

proceedtofulfillyourpromisetohim:

“Well,whatI’dliketodoistotellyouaboutthosethings.Atthesame

time,I’dliketoshowyousomeincrediblyeffectivewaysmyfirm,

WalterMittyCompany,hasdevelopedtohelpyoutocontrolmoneyhere

inyourbusinessOkay?”

Thethirdthingyoudoistoestablishyourcredibilityintheprospect’s

mindbycommunicatingtwothings.First,yourcompany’sexpertiseis

suchmatters:“WeareMoney-ControllingSpecialists”(we,atE-Myth

Worldwide,callthataPositioningStatement).Andsecond,yourpersonal

willingnesstodowhateverisnecessarytoutilizethatexpertiseonhis

behalf:

“Letmetellyouwhywecreatedourcompany,Mr.Jackson.We’ve

foundthatpeoplelikeyourselfarecontinuallyfrustratedbynotbeing

abletogetthemostoutoftheirmoney.Frustratedbypayinghigher

interestratesthantheyhaveto.Byworkingwithfinancialexpertswho

don’tseemtoknowwhatthey’redoing.Bybankingwithabankthat

doesn’tseemtohavetheirbestinterestatheart”Andsoon.

“Dothesethingseverfrustrateyou.MrJackson?Ofcoursetheydo

Andthat’swhyWalterMittyCompanyhascreatedaMoney-Controlling

Systemthatmakesitpossibleforyoutogetthemostpreferential

treatmentinthefinancialarenawhilepayingtheleastforit.NowI

knowthatsoundstoogoodtobetrue.Butletmeexplainhowwe

proposetogoaboutdoingthatforyou….”

HereJohnnyJonesiscommunicatingthatheunderstandswhat

frustratesMr.Jackson,andthathehastheexpertisetoalleviatethose

frustrations—notpersonallybutsystematically—throughtheuseofthe

WalterMittyCompany’sMoney-ControllingSystem.

ThefourththingyoudoinaNeedsAnalysisPresentationisdescribe

theWalterMittyCompany’sMoney-ControllingSystemandwhyitworks

sowell.Notwhatitdoesbuttheimpactitwillhaveontheprospect:

“TheWalterMittyCompany’sMoney-ControllingSystemisdesignedto

dothreethings,Mr.Jackson.

“First,itenablesustoknowwhatspecificallybothersyouabout

controllingyourmoney.Becauseweknowthatcontrollingmoneymust

bepersonallytailoredtoeachandeveryoneofourclients.Inorderto

dothatwe’vecreatedwhatwecallatWalterMittyCompanyaMoney

ManagementQuestionnaire.Byaskingyoutheseparticularquestions,

we’rewellonourwaytohelpingyougetwhatyouwant.BeforeIleave

today,I’llreviewtheQuestionnairewithyou.

“OncetheQuestionnaireiscompleted,wereturnittoourFinancial

SystemsGroup.Thisisagroupoffinancialspecialistswhoreviewyour

Questionnairetomakecertainthatithasbeencompletedaccurately.

“Ifithas,theyentertheinformationintoourMoney-Controlling

Systemthathasbeendesignedtoanalyzethisinformationandcompare

itwiththebroadspectrumofdatawe’veassembledovertheyears.Once

havinganalyzedtheinformation,theSystemwillthencreatepersonally

tailoredsolutionsjustforyou,Mr.Jackson.Waystosecurethekindof

preferentialtreatmentwetalkedaboutearlier,butatthelowestpossible

cost.Waysofcontrollingyourmoneyandusingittoyouradvantage,

notsomeoneelse’s.

“ThesesolutionswillthenbepreparedintheformofaFinancial

ReportthatI’lldelivertoyoupersonallyandreviewwithyouatthat

time.

“Shouldanyofoursolutionsmakesensetoyou,we’llbemorethan

happytohelpyouimplementthem.Ifnot,thenatleastwe’llhave

startedtheprocessofbecomingbetteracquaintedsothatwemaybeof

assistancetoyousomeothertime.

“Inanycase,theFinancialReportisyours—atabsolutelynocost

whatsoever.It’sourwayofsayingwe’reseriousaboutwhatwedo,and

wouldbehappytoworkwithyou,whethernoworinthefuture.

“Solet’sreviewtheQuestionnairetogether,andwhenwe’redoneI’ll

provideyouwithasummaryofsomeoftheremarkablenewthingsthat

arehappeningintheworldtocontrolmoney.AndthenI’lltakeyour

informationbacksowecanprepareyourFinancialReport.Okay?”

ThefifththingJohnnyJonesdoesintheNeedsAnalysisPresentation

iscompletetheMoneyManagementQuestionnaire.

ThesixththingJohnnyJonesdoesisprovidetheprospective

customerwiththeinformationhepromisedandshowhimhowrelevantit

istotheFinancialReporthewillbepreparingforhim.(Hecouldhave

donethisattheoutsetoftheirmeeting,duringtheNeedsAnalysis

questioningprocess,ornow,attheend.)

ThesevenththingJohnnyJonesdoesintheNeedsAnalysis

Presentationismakeanappointmentwiththeprospectivecustomerto

returnwiththeFinancialReport,remindinghimthatJohnnyJoneswill

havesomevaluablesolutionsforhim—atnocost!—andthatJohnnywill

takewhatevertimeisnecessarytohelptheprospectivecustomer

understandthosesolutions,whetherhedecidestoimplementthemor

not!

UponcompletionoftheNeedsAnalysisPresentation,JohnnyJones

willhavemadeanappointmentthatwillbringhimtothethird

BenchmarkinthePowerPointSellingProcess,theSolutions

Presentation.

THESOLUTIONSPRESENTATIONTheSolutionsPresentation

istheeasiestcomponentofthePowerPointSellingProcess.Becauseif

JohnnyJoneshasdonehisjobeffectivelyuptothispoint,thesaleis

alreadymade.

Mostsalespeoplethinkthatsellingis“closing.”Itisn’t.Sellingis

opening.That’swhattheNeedsAnalysisPresentationdoes.Itopensup

theprospectivecustomertoadeeperexperienceofhisfrustrationandto

theopportunitiesavailabletohimbygoingthroughthequestioning

processwithyou.

Younowhavesomethingtogivehim.

“Remarkablenewthings”thatwillmakeitpossibleforhimtoreceive

“preferentialtreatment”inthe“financialarena”soastosecurethekind

of“control”overhismoneyhe“deserves”andata“preferentially”low

cost.

Inotherwords,byknowingyou(orJohnnyJones),yourprospective

customerisgoingto:(1)beontheinsideofthefinancialwinnerscircle

withpeoplewhoareintheknow;(2)betreatedlikeimportantpeopleare;

(3)usemoneylikethe“pros”do;and(4)gaincontroloverhislife.

Andhe’sgoingtogetallofthiswithoutpayingtoohighapriceforit!

Whatmorecouldanyoneaskfor?

TheSolutionsPresentationsimplyprovidestherationalarmament

fortheemotionalcommitment(rememberthat?).

HereJohnnyJonesbringstheprospectup-to-datebyreviewing

everythinghesaidanddidduringtheNeedsAnalysisPresentation.The

prospecthasforgottenallthosepsychographicallycompellingthingsby

now.Buthewon’tforlong—they’reapartofhim.

ThenJohnnyJonesreviewsingreat,patient,andearnestdetailevery

lastword,comma,andnumberinhisprospectivecustomer’sFinancial

Report!

Heasksquestionstomakecertainthattheprospectfeelsthatthisis

hisFinancialReport,notWalterMittyCompany’s.

AndwhenJohnnyJonesisdone,whenhe’sreviewedallofthe

componentsoftheFinancialReportpreparedjustforhisprospect,Mr.

Jackson,heaskshimthisquestion:“Oftheoptionswe’vesuggestedhere,

Mr.Jackson,whichdoyoufeelwouldbestserveyourightnow?”And

thenwaitsfortheanswer!Becausethenextpersonwhospeaksisgoingto

makeapurchase.Ifthat’sJohnnyJones,he’sgoingtobuya“nosale.”

Andthat’sall,exceptforwritingupthesale!

Ofcourse,there’severythingelsetodo.

Whathappenswhentheprospectsaysthis?

Whathappenswhentheprospectasksmethat?Andsoforth.

Butbelieveme,whetheryou’resellingsheetsandpillowcases,

computers,swimmingpools,flowersandfertilizer,canaries,puppies,or

Quonsethuts,thePowerPointSellingProcesswillwork.

HowdoIknowthat?

Becauseitalreadyhas!

ButiftheProcessistoworkforyou,youmustbewillingtogo

throughitthesamewayeverysingletime.Usingthesamewordsthe

samewayeverytime.ReviewingtheFinancialReportthesamewayevery

time.

Andbydoingitthesamewayeverysingletime,youwillnothavea

sellingpersonbutasellingsystem.

ASoftSystem.

Acompletelypredictabletechnologyforproducingformerly

unpredictableresults.

Andyouwillbeabletotelljusthowpredictableitisthroughtheuse

ofanInformationSystem.

InformationSystems

ForanInformationSystemtointeractwiththeSoftSysteminour

example,itshouldprovideyouwiththefollowinginformation:

INFORMATION BENCHMARK

Howmanycallsweremade? 1

Howmanyprospectswerereached? 2

Howmanyappointmentswerescheduled? 3

Howmanyappointmentswereconfirmed? 4

Howmanyappointmentswereheld? 5

HowmanyNeedsAnalysisPresentationswere

scheduled?

6

HowmanyNeedsAnalyseswereconfirmed? 7

HowmanyNeedsAnalyseswerecompleted? 8

HowmanySolutionsPresentationswerescheduled? 9

HowmanySolutionsPresentationswereconfirmed? 10

HowmanySolutionsPresentationswerecompleted? 11

Howmanysolutionsweresold? 12

Whatwastheaveragedollarvalue? 13

Theinformationshouldberecordedonaform,eithermanuallyoras

adatabaseonyourcomputer.

TheInformationSystemwilltracktheactivityofyourSellingSystem

fromBenchmarktoBenchmark.

Itwilltellyouanastonishingnumberofthings.

ItcouldtellyoutherateofconversionbetweenanytwoBenchmarks

inyourSellingProcess.

ItcouldtellyouatwhichBenchmarkanyparticularsalespersonneeds

help.Whichofyourpeopleare“onthesystem”—thatis,usingtheSelling

Systemverbatim—andwhichonesareoffit.

Ifyouhadcalculatedthecostofmakingacall,youcouldthen

calculatethecostofcompletingthenextBenchmarkintheprocess,and

fromthatderivethenext,andsoon,untilyoucalculatetheactualcostof

makingonesale.

Inshort,theInformationSystemcouldtellyouthethingsyouneedto

know!

Thingsyoudon’tknownow.

Thingsyouneedtoknowinordertodevelop,control,andchange

yourSellingSystem.

AndthingsyoualsoneedtoknowinFinanceandProductionand

ProductDevelopment.

IfyourSystemsStrategyisthegluethatholdsyourFranchise

Prototypetogether,theninformationisthegluethatholdsyourSystems

Strategytogether.

Ittellsyouwhenandwhyyouneedtochange.

Withoutit,youmightaswellputonablindfold,havesomeoneturn

youaroundthreetimes,andsetoutwithadartinyourhand,waitingfor

asignalfromtheheavenstothrowit.

Notaverypromisinggame.

Butone,itseems,mostpeopleinsmallbusinessaredeterminedto

play.

HardSystems,SoftSystems,InformationSystems.

Things,actions,ideas,information.

Thestuffofwhichourlivesaremade,andthestuffofyourbusiness

aswell.

Doyouseehowdifficultitistoseparateonefromtheother?

Doyouseehowintertwinedtheyare?

DoyounowunderstandwhatImeanbyyourbusinesssystem?

Andwhyitisabsolutelyessentialthatyoubegintothinkofyour

businessasafullyintegratedsystem?

Thattoapproachanypartofyourbusinessasthoughitwereseparate

fromalltherestwouldbelunacy,becauseeverythinginyourbusiness

affectseverythingelseinyourbusiness.

ThatyourPrimaryAimandyourStrategicObjectiveandyour

OrganizationalStrategyandyourManagementStrategyandyourPeople

StrategyandyourMarketingStrategyandyourSystemsStrategy—allof

themaretotallyinterdependent,ratherthanindependentofoneanother.

ThatthesuccessofyourBusinessDevelopmentProgramtotally

dependsonyourappreciationofthatintegration.Andthatyour

Prototypeisthatintegration.

Ifyouunderstandallofthat,thenthisbookhasbeenworthourtime.

Ifyoudon’t,takeofftheblindfold,becausethere’snogoingaround

onemoretime.

We’vegotbusinesstoattendto.

There’snotimelefttotrustadartinthedark.

Wewerealmostdone.SarahknewitandIknewit.Allthatwasleftwasto

tiethepiecestogether.Tohelphertointegrateeverythingwehadtalked

abouttogether.Tohelphertoseehowitwasallapplicable—indeed,

essential,toherbusinessAllAboutPies.

“IunderstandwhatyoumeanbyHardSystems,”shesaid.“Thesign

onmyshop,thefloors,thewalls,thedisplaycases,thetables,my

people’suniforms,andsoforth.Inotherwords,allofthevisualelements

ofmybusinessandthewaytheyallfittogether.Infact,whenit’salldone

correctly,theentirebusinessshouldlooklikeonefullyintegrated,

beautifullydesignedsystem.

“IevenunderstandwhatyoumeanbyInformationSystems,”she

continued.“Myabilitytoextractfromtheday-to-dayoperationofmy

shops(shewasalreadythinkingaboutfourshops,ratherthanone!),how

manypiesaresold,whatkindofpies,thetimetheyweresold,howmany

customerscameineachshopandwhen,howmanyboughtpiestogo,

howmanyslicesofpieweresoldtoeatonthepremises,howmanyofthe

customerswhoboughtpietoeatonthepremisesboughtapietogo,and

soforth.AndIcanimagineagooddealmorethanthatIwouldliketo

knownowthatI’vebeguntothinkaboutit.

“WhatIdon’tfullyunderstandistheSoftSystemspart.Canyoutell

mealittlebitmoreaboutthat?Ican’tpossiblyimaginemypeopleusing

—whatdidyoucallit?ThePowerPointSellingSystem?”

“Isuspectyoudowithoutrealizingit,”Isaid.

“RememberwhatItalkedaboutearlyonwhenwewerediscussing

Innovation?‘Hi,haveyoubeeninherebefore?’asopposedto‘Hi,canI

helpyou?’

“Well,what’syourversionofthat?

“RememberwhenwetalkedabouttheGameWorthPlayingandthe

recruitmentprocesstheManagerusedatthehotel?

“Whataboutthescriptheusedwhenhetoldthestoryaboutthe

Boss’sgame?What’syourversionofthat?

“Andrememberwhenwetalkedaboutthehotel’schecklists,andthen

wentontodescribetheManagementSystemthatdefinedthem?What’s

yourversionofthat?

“Infact,”Icontinued,“everywrittenorverbalcommunicationwith

anyonewhocomesintocontactwithyourbusinessisaSoftSystem.What

sofewofusunderstandisthepowerofthosewordswhentheyaretotally

integrated.Thatyourrecruitmentscript,andyourshop’sname,andthe

trainingyouconductinyourschool,andthewordsinyourcustomer

brochures,andyourads,everythingyousay,mustworktogetherjustas

thevisualcomponentsofyourshopmustworktogether,tomakeone

powerfullyeffectivemessage.

“ThatyouareAllAboutPies,andthatthereisnoone,absolutelyno

oneelselikeyou.

“Thereisnooneelsetellingthesamestory.

“Thereisnooneelseusingthesesamewordsinexactlythesameway

asyouare.

“AndthatthesewordsrepresenttheIdeabehindAllAboutPies.

“TheIdeathatcomesfromyourmindandyourmindalone.

“TheIdeathatyourauntunderstoodsowellandthatyouunderstand

sowell.

“TheIdeaofyourbusiness,whichisthelifebloodofyourbusiness.

Whichistheheartofyourbusiness.Whichisthespiritofyourbusiness.

“Andyouknownowhowvaluablethatspiritis,Sarah.It’stobe

cherished.It’stobesharedwithothers.It’stobesetfreeupontheworld.

“That’swhatSoftSystemsare.Doyougetitnow?Doyouseehowall

ofthisfitstogetherintoonelovely,endurable,howeverever-changing,

wonderfulwhole?

“CanyouseenowwhyIsaythatTheTechnician’sroleisnotenough

byfar?Thatthere’ssomuchmoretobedoneifyourbusinessiseverto

liveuptoitspotential?

“Andthatit’sfun!”

Sarahwasgrinningfromeartoear.

Formoreinformation,visitusatwww.e-myth.com.

19ALETTERTOSARAH

Freedomdoesnotcomeautomatically;itisachieved.Anditisnot

gainedinasinglebound;itmustbeachievedeachday.

RolloMay

Man’sSearchforHimself

DearSarah,

Ithasbeensaidthattherearenoaccidentsintheuniverse,andsoI

mightconsiderittobeprovidentialthatonthisverydaythatI’mwriting

thislettertoyou,Ihavejustfinishedreading,forthethirdtime,Rollo

May’sremarkablebook,Man’sSearchforHimself.Whatalessonthat

bookholdsforallofusinbusinesswhowouldbelievethattoday’shot

subjectsofcorevalues,meaning,purpose,andempowermentare

advancedthinkingwhen,infact,RolloMayspokemoreeloquentlyabout

thoseverysamesubjectsin1953!

Forthatmatter,whoamongustodayinbusinessrecallsMay’sAgeof

Anxiety,orCamus,orDostoyevsky,orKierkegaard,orKafka,orOrwell,

orT.S.EliotinTheHollowMen,orDavidRiesmaninTheLonely

Crowd?Tothem,however,thequestionwasnotoneofsuccessin

businessbutoflifeanddeath!

Ifwehadsuchayearningforvaluesin1953whenMay’sbookwas

firstpublished,andwehavesuchayearningforvaluestoday,whathas

happenedtousintheinterim?TheColdWar?Atriptothemoon?Korea?

TheVietnamWar?Cambodia?TheSexualRevolution?TheFeminist

Revolution?TheCivilRightsExplosion?ThePsychologicalRevolution?

TheNewAgemanifestoandthecomingmillennium?OnehellofalotI

wouldsay!Andyet,afterallthat,andfortyyears,wearestillsearching

formeaning,forsomethingtobelievein,andspeakingaboutitasthough

itwerebrandnew!

Whatlessonshaven’twelearnedhereattheendofthetwentieth

century,Sarah?Maybewejustdon’tcareenough.Meaning,itseemsto

me,istheproductofcaring,notviceversa.Whatwecareaboutwevalue.

Andso,asIlookaround,Iseethatweareinsomeveryfundamentalway

disconnectedfromcaringsufficientlytobeabletofindtruemeaningin

thethingsthatwedo.

Whichisnottosaythatwedon’tcareaboutanything;weobviously

do.Wecareaboutmakingmoney.Wecareaboutbeingsafe.Wecare

aboutbeingprotected.WecareabouttheSuperbowl.

ButIthinkthatthethingswehavecometocareaboutare

insignificantwhenplacedonthescalethatDostoyevsky,orCamus,or

Tolstoy,orKierkegaard,orKafka,ortheOldTestament,ortheNew

Testament,orRolloMaywoulduse.Theproblemis,Sarah,we’rejustnot

veryseriouspeoplethesedays.Weevenspeakaboutvalues,whenwe

speakaboutthem,asthoughtheywereacommoditylikeasweaterora

pairofGuccipumpsthatcanbeacquiredbywritingacheck.Muchlike

theLeadership,Empowerment,Management,Relationship,andQuality

Trainingseminarsthataboundtoday.Asthoughbygettingalittle

trainingwewillsuddenlyfindourselvesfullofmoresubstantialstuff.I

thinknot,Sarah.

Ithinkthatwe,playingourendgameatthebottomofthetwentieth

century,aregoingtoneedonehellofalotmorethananythingour

“trainers”haveinstoreforus.Ithinkweneedashock,aself-

administeredshock,sojolting,sooutrageous,sounsympathetictoour

littlewants,thatwe’lleitherbeblownofftheplanetwe’veeachshapedfor

ourselves—ourpersonallittlespaces—whenweleastexpectit,orwewill

burntoacrisprightthereonthespot,nevertobeheardfromagain.

Andthereinliestheproblem,Sarah,and,ofcourse,theopportunity.

Howdoesonecometothepointinhisorherlifewhenheorsheisnot

onlyreadybuteagerandwilling—howeverterrifyingtheprospectmight

be—toself-executesuchaleapoffaithwithoutanyguaranteesthatitwill

doanygood?

That,dearSarah,iswhereIbelievewelefteachothernottoolong

ago,atacrossroads,whereIstoodandwatchedyouwalkoffonyour

newlydiscoveredpath,thinkingtomyselfthatIknewwhereyouwere

goingandwhatyouwoulddiscoverthere,and,atthesametime,realizing

Iknewnothingofthesort.Thatthepathyouhadchosenreachedboth

forwardintimeandbacktoyourchildhoodandthe“spirit”youhad

thoughtyoulost.

ButwhatIknowtobetruefrommyownlifeexperienceisthatyou

willnottrulyrediscoveryour“spirit”inthepastbutwilldiscoveritis

waitingforyouinthefutureonthepathyouhavenowchosen.Yourspirit

isn’tbehindyou—itiswayaheadofyou;ithasalreadymadeitschoice!

Allthatneededtohappenwasforyoutomakeyours,andyouwere

togetheragain!Prettymetaphysicalforahard-headedguylikeme,

perhaps,butwhileIcan’tproveit,Iknowwithoutashadowofadoubt

thatitistrue.

Iknow,becausetheverysamethinghashappenedtome,timeand

timeagain,whenIwasopentoit.Iknowthatmyspiritiswaitingout

thereinfrontofmeononeofanynumberofathousandpaths,andthat

it’suptometochoosethatonepathonwhichmyspiritwaits,andtostep

outonitbrightly,withouthesitation,topursuetheI,whichisthegreatest

oneIcanpossiblybe.Tobespirit-full,thatis,spiritual.Thatistobein

touchwithmysoul.

Andthere,inourspirit,Sarah,iswheremeaninglies.There,inwhat

yourauntcalledcaring.Itisyourspiritthatcares,Sarah.Whileyour

parentsandteachersthoughtitwasdisruptiveandtriedtotakeitaway

fromyou,yourauntknew,Sarah,whatyou’vejustfoundout.Thatyour

spiritwaswaitingthereallthetime!Ithadn’tgoneanywhere;youhad.

Andthepathyouarenowonisthesamepathyouandyourauntwereon,

thereinthekitchen,andthereinyourlittlegirl’sbedonthesummer

morningasyoubreathedintherich,delicatesummerair,andthere

amongthefouroaks,andtherewithyourhandonthefaceoftheblack

horse.

Yourpathhasalwaysbeenthereforyou,Sarah.Yousimplygotlost.

Youdidn’ttrustit.Inyourneedtobeassured,asanylittlegirlwould,that

yourparentswouldn’tleaveyouandthatyourteacherswouldloveyou,

youbecamedisconnectedfromyourself.But,fortunately,notforever.

Becausethispathyou’renowon,thisentrepreneurialpath,winds

aroundcornersthatwillamazeyouattimes,andevenshockyouat

others.Tobesure,itwillbeanythingbutcertain,butthat’swhyitisso

exciting!It’sthepathofsurprise.It’sthepathofconstantengagement.

Andbecauseit’sallthosethings,itistrulythepathoflife,or,asRollo

Maymighthavecalledit,“thepathoffreedom.”Hesaid:“Thusfreedom

isnotjustthematterofsaying‘Yes’or‘No’toaspecificdecision:itisthe

powertomoldandcreateourselves.Freedomisthecapacity,touse

Nietzsche’sphrase,‘tobecomewhatwetrulyare.’”1

Andso,Sarah,whilewehavetalkedagreatdealaboutyourbusiness

anditsrelationshiptoyou,whilewehavespokenaboutplanningand

systemsandcontrolsandmanagement,aboutpeopledevelopmentand

organizationaldevelopmentandmarketingdevelopment,andallthose

manypartsofyourbusinessyoumustbecomenotonlyawareofbut

attentiveto,IwouldberemissifIleftyouwiththeimpressionthatanyof

thosethingswillmakeanydifferenceatallunlessyourememberone

thing:keepthecurtainup.

ThecurtainisyourComfortZone.AndyourComfortZonehasbeen

thefalsemaskyouputonwhenyouwerealittlegirl,becauseitwassafe

whenyourspiritwasnot.YourComfortZonehasbeenthecurtainyou

haveplacedinfrontofyourfaceandthroughwhichyouviewtheworld.

YourComfortZonehasbeenthetightlittlecozyplanetonwhichyouhave

lived,knowingalltheplacestohidebecauseit’ssosmall.YourComfort

Zonehasseizedyoubefore,Sarah,anditcanseizeyouagain,whenyou’re

leastpreparedforit,becauseitknowswhatitmeanstoyou.Becauseit

knowshowmuchyouwanttobecomfortable.Becauseitknowswhat

priceyouarewillingtopayforthecomfortofbeingincontrol.The

ultimateprice,yourlife.

So,Sarah,ifthisnewpath,iflivingwithyourspirit,meansanything

toyouatall,ifyoutrulycareaboutit,thenguarditwithyourlife.

BecauseComfortovertakesusallwhenwe’releastpreparedforit.

Comfortmakescowardsofusall.

Andso,good-byefornow.Pleaseletmeknowhowyou’redoing;how

thebusinessisgoing.Andremember,myheartwillbewithyouwherever

youare.

MichaelE.Gerber

1

EpilogueBRINGINGTHEDREAMBACKTOAMERICANSMALL

BUSINESS

Youshouldknownowthatamanofknowledgelivesbyacting,not

bythinkingaboutacting,notbythinkingaboutwhathewillthink

whenhehasfinishedacting.Amanofknowledgechoosesapath

withheartandfollowsit.

CarlosCastaneda

ASeparateReality

Thisbookisnotsimplyaprescriptionforsuccess;it’sacalltoarms.

Butthiscalltoarmsisnotacalltodobattle.It’sacalltolearning.

Howtofeel,think,andactdifferentlyandmoreproductively,more

humanlythanourexistingskillsandunderstandingallow.Today’sworld

isadifficultplace.Humankindhasexperiencedmorechangeinthepast

twentyyearsthanithasinthe2,000thatprecededthem.

Boundariesthatonceservedus—geographically,politically,socially,

emotionally—nolongerexist.Therulesareconstantlychanging.But

peoplecannotlivewithoutboundaries,withoutstructure,withoutrules.

Sonewoneshavesprungupandproliferatedinordertofillthevoidleft

bythosethatnolongerseemtoserveour“NewAge”condition.

Unfortunately,inaworldofacceleratedchangethereislittletimefor

rulestotakehold.Assoonasthenewrulesareuponus,theytooare

swallowedupintheinsatiablevortexofchange,followedalltooquickly

bymorerules,andthenstillmore.

Theresultofallthischangeischaosanddisorder,eachchange

bringingwithitanevenmoreturbulentworldthantheonebeforeitwith

fewerandfewertraditionstoholdonto.Aworldintrouble,where

confusionreigns.

Butthetroubledidn’tstart“outthere”intheworld.Ifitdid,we’d

reallybeintrouble.Becausewhoamongusknowsenoughtocontrolor

evenhaveanimpactonwhat’shappening“outthere”?Ifitissodifficult

forustodoanythingaboutourbusinesses,howintheworldarewegoing

todoanythingabouttheworld?

Wecan’t.It’sthatsimple.Andanycalltoarmsthatsuggestswecanis

astopgapmeasure,acalltodisillusionmentandultimatelytodisaster.

Becauseourstopgapmeasuresarenotsolutions.Ourfeebleattemptsto

fixtheworldcan’tchangetheoverallcondition.Iftheyworkatall,they

canonlychangethecircumstancesinwhichwefindourselvesatany

givenmoment.

No,wecan’tchangetheworld“outthere.”Andfortunately,wedon’t

haveto;wecanbeginmuchclosertohome.Wecanbegin“inhere.”In

fact,ifwe’retosucceed,wemust.Becausethechaosisn’t“outthere”in

everyoneelse.It’snot“outthere”intheworld.Thechaosis“inhere”in

youandme.

Theworld’snottheproblem;youandIare.

Theworld’snotinchaos;weare.

Theworld’sapparentchaosisonlyareflectionofourowninner

turmoil.

Iftheworldreflectsalackofgoodsense,it’sbecauseeachoneofus

reflectsthesame.Iftheworldactsasifitdoesn’tknowwhatit’sdoing,

it’sbecauseeachoneofusactsthesame.Iftheworldisviolent,and

greedy,andheartless,andinhuman,andoftenjustplainstupid,itis

becauseyouandIarethatway.

Soiftheworldisgoingtobechanged,wemustfirstchangeourlives!

Unfortunately,wehaven’tbeentaughttothinkthatway.Wearean

“outthere”society,accustomedtothinkingintermsofthemagainstus.

Wewanttofixtheworldsothatwecanremainthesame.Andforan“out

there”society,coming“inside”isaproblem.

Butnowisthetimetolearnhow.Nowisthetimetochange.

Becauseunlesswedo,thechaoswillremain.

Andwecan’taffordthiskindofchaosmuchlonger.

We’resimplyrunningoutoftime.

BridgingtheGap

Andthat’swhatthisbookisreallyabout.Bridgingthegap.

Betweenthe“outside”andthe“inside.”

Betweentheworld“outthere”andtheworld“inhere.”

Andyoursmallbusinesscanbecomethatbridge.Thebridgebetween

youandtheworld.Thebridgethatcandrawtogethertheworld“out

there”andtheworld“inhere”insuchawayastomakebothmore

human.Insuchawaythatmakesbothmoreproductive.Insuchaway

thatmakesbothworldswork.

ForliketheBoss’shotel,yoursmallbusinesscanbecomeyourdojo,

yourpracticehall.JoeHyams,inhisbookZenintheMartialArts,tells

uswhatadojois:

Adojoisaminiaturecosmoswherewemakecontactwithourselves—

ourfears,anxieties,reactions,andhabits.Itisanarenaofconfined

conflictwhereweconfrontanopponentwhoisnotanopponentbut

ratherapartnerengagedinhelpingusunderstandourselvesmorefully.

Itisaplacewherewecanlearnagreatdealinashorttimeaboutwho

weareandhowwereactintheworld.Theconflictsthattakeplace

insidethedojohelpushandleconflictsthattakeplaceoutside.Thetotal

concentrationanddisciplinerequiredtostudymartialartscarriesover

todailylife.Theactivityinthedojocallsonustoconstantlyattempt

newthings,soitisalsoasourceoflearning—inZenterminology,a

sourceofself-enlightenment.1

Andthatisexactlywhatasmallbusinessis!

Asmallbusinessisaplacethatrespondsinstantlytoanyactionwe

take.Aplacewherewecanpracticeimplementingideasinawaythat

changeslives.Aplacewherewecanbegintotestalloftheassumptions

wehaveaboutourselves.Itisaplacewherequestionsareatleastas

importantasanswers,ifnotmoreso.Itisaplacewheregeneralizations

mustgivewaytospecifics.Itisaplacethatdemandsourattention.A

placewhererulesmustbefollowedandorderpreserved.Aplacethatis

practical,notidealistic.Butaplacewhereidealismmustbepresentfor

thepracticaltoserve.Itisaplacewheretheworldisreducedto

manageablesize.Smallenoughtoberesponsive,butbigenoughtotest

everythingwehave.Atruepracticehall.

Aworldofourown.

AWorldofOurOwn

Andthatafterallisthe“DreamofAmericanSmallBusiness,”the

dreamthathasservedasthecatalystforsomanyentrepreneurial—and

notsoentrepreneurial—efforts.

Tocreateaworldofourown.

WhatisthisEntrepreneurialRevolutionpeoplearetalkingabout

today,wheremillionsofusaregoingintobusinessforourselves?

It’snothingmorethanaflightfromtheworldofchaos“outthere”

intoaworldofourown.

It’sayearningforstructure,forform,forcontrol.Andforsomething

elseaswell.Somethingmorepersonal.Somethinglessdistinct,yetmuch

moreintimatelyconnectedwithwhoweareashumanbeings.It’sa

yearningforrelationshipwithourselvesandtheworldinaway

impossibletoexperienceinajob.

Unfortunately,aswe’vealreadyseen,the“dream”israrelyrealized;

mostsmallbusinessesfail.Andthereasonisobvious.Webringour

chaoswithus.

Wedon’tchange.Wetrytochange“outthere.”Wetrytochangethe

worldbystartingasmallbusiness—butwestaythesame!

Andsothesmallbusinessthatwasstartedtogiveusanewworld

becomesinsteadtheworstjobintheworld!

Thelessontolearnfromallthisissimple:wecan’tchangeourlives

bystarting“outthere.”Allwecanproduceintheprocessismorechaos!

Wecanonlychangeourlivesandcreateaworldofourownifwefirst

understandhowsuchaworldisconstructed,howitworks,andtherules

ofthegame.Andthatmeanswehavetostudytheworldandhowweare

init.Andinordertodothatweneedaworldsmallenoughinscopeand

complexitytostudy.

Asmallbusinessisjustsuchaworld.

AndaBusinessDevelopmentProgramcanbeameanstostudyit

mosteffectively.

AndtheFranchisePrototypecanprovideourstudywiththediscipline

itneedstosucceed.

Innovation,Quantification,andOrchestrationbecomethepractice

thatbringsusandouropponent—whoeverthatmaybe—tothediscovery

ofourlimits,ourweaknesses,ourstrengths.Tothediscoveryofwhat

reallyworksintheworldratherthanwhatourimaginationsmightwish

wouldwork.Forinamartialartscontest,thereisnoroomfor

imagination.Wecouldgetkilledoutthere!

Innovation,Quantification,andOrchestrationprovidethebelief

systemofourbusiness,thephilosophicalbedrockofourinteractionwith

theworld.Theybecomeoursourceforlearning,forcreating,for

expandingbeyondourself-imposedlimits.

AndthroughInnovation,Quantification,andOrchestrationour

businesscanbecomesomethingmorethanmerelyaplacetogotowork.

ItcanbecomeaplacethatsatisfiesmoreofourselvesthanjustThe

Technician.ThereisaplaceinBusinessDevelopmentforthewholeof

ourselves.Fortheinnovator,forthemaintainer,forthedoer.ForThe

Entrepreneur,TheManager,andTheTechnicianineachoneofus.

Yoursmallbusinessandminecangiveusmorelife.

AnIdeaforAction

Butdoesitwork?

WillthemodeloftheFranchisePrototypeworkforyou?

ThereisanoldChineseproverbthatsays:

Whenyouhearsomething,youwillforgetit.

Whenyouseesomething,youwillrememberit.

Butnotuntilyoudosomething,willyouunderstandit.

Inshort,myanswerisaresounding,“Yes!”Itdoeswork.Everytime

it’sapplied.Anditwillworkforyou.Itworksbecauseitrequiresthefull

engagementofthepeopleworkingit.Itcan’tbedonehalf-heartedly.It

can’tbedonefrenetically.Itcanonlybedoneintelligently,reasonably,

intentionally,systematically,andcompassionately.

TheveryProcessofBusinessDevelopmentcreatesinstantaneous

changeinthepeoplewhoengageinit.

Andthatisthekeytoitssuccess.

Thosewhoengageintheprocessmustremembertheiraiminorder

tocontinueit.Andintheprocessofremembering,theiraimbecomes

tetheredtosomethingrealintheworld—theirbusiness.Aplaceinwhich

aimscanbetestedinaconcrete,practicalway.Thebusinessbecomesa

symbolforthelifetheywishtolive,avisiblemanifestationofwhothey

areandwhattheybelieve.Aliving,active,evolvingtestamenttothewill

ofman.

But,Iaskyounottothinkaboutitanymore.

It’stimetoact.

Becauseuntilyoudo,youwon’tunderstandit.

Andwhenyoudo,therewillbenothinglefttothinkabout—you’llbe

wellonyourway.

Untilthen,it’sjustanothergoodidea,justanothercreativethought.

It’stimetoturnitintoaninnovation.

It’stimetoBringtheDreamBacktoAmericanSmallBusiness.

It’sbeengonefartoolong.

1

AfterwordTAKINGTHEFIRSTSTEP

Sonowwhatdoyoudo?

Nowthatthefireisburning.Nowthatyouwanttogetstarted.Now

thatyouwanttoturnyourbusinessintoalittle“moneymachine,”aturn-

keyoperation.

Well,likeSarah,andthousandsofsmallbusinessownersjustlikeher,

youmusttakethefirststep.

Youmuststepbackfromyourbusinessandlookatitthroughyour

newE-Mytheyes.

Youmustanalyzeyourbusinessasitistoday,decidewhatitmust

looklikewhenyou’vefinallygotitjustlikeyouwantit,andthen

determinethegapbetweenwhereyouareandwhereyouneedtobein

ordertomakeyourdreamareality.

Thatgapwilltellyouexactlywhatneedstobedonetocreatethe

businessofyourdreams.

Andwhatyou’lldiscoverwhenyoulookatyourbusinessthroughyour

E-Mytheyesisthatthegapisalwayscreatedbytheabsenceofsystems,

theabsenceofaproprietarywayofdoingbusinessthatsuccessfully

differentiatesyourbusinessfromeveryoneelse’s.

SinceTheE-Mythfirstappearedin1986,weatE-MythWorldwide

haveassistedthousandsofsmall-businessownersintakingthatfirststep

backfromtheirbusinessestodiscoverwhatthegapwasineachoftheir

cases.

Wewouldlovetodothesameforyou.Itbeginswithourinvitationto

takepartinourfreeE-Mythexperience.Youwilllearnhowtocrossthe

bridgefromwhereyouaretowhereyouwanttobeinyourbusiness,your

life,andyourfuture.TheE-Mythexperiencewilltakeyoutoaplaceyou

haveneverbeenbefore,anditwillfeellikehome.

Totakeyourfirststep,simplycompletetheformatthebackofthis

bookandfollowtheinstructionsprovided.

Andremember…

Whenyouhearsomething,youforgetit.

Whenyouseesomething,yourememberit.

Butnotuntilyoudosomethingwillyouunderstandit.

Let’sgetstarted.

MichaelE.Gerber

E-MythWorldwide

SantaRosa,California

June,2001

AbouttheAuthor

MICHAEL E. GERBER is the Founder, Chairman and CEO of E-Myth

Worldwide, the companyhe founded in 1977 to provide small-business

owners and entrepreneurs with the help they need to build a business

that works. Since then, E-Myth Worldwide has provided more than

25,000 small and emerging business-owner clients with the means to

radically transform their businesses and their lives. It is fast becoming

world-wide the largest and most effective small-business development

resourceofitskind.

Thought bymany as “the leading voice of small-business in America,”

Michael Gerber has spoken to thousands of small-business owners,

managers,andcorporateexecutivesthroughouttheworldaboutthetruly

profoundroletheentrepreneurialperspectivecanplayinthereinvention

oftheworld’seconomyandculture.Hismessage isunique,compelling,

and pragmatic. And best of all, as his thousands of readers, business

clients,andseminarparticipantsattest,itworks.

IfyouareinterestedinhavingMichaelGerberaddressyourorganization,

or wish to receive more information about Mr. Gerber’s innovative E-

MythMasteryProgram,books, and tapes, callTollFree:800-221-0266

(US & Canada) or 707-569-5757 (worldwide). Or write to: Michael

Gerber,E-MythWorldwide,2235MercuryWay,Suite200,SantaRosa,

California,95407.VisitusatourWebsite:www.e-myth.comorsendus

anemail:info@e-myth.com.

Visitwww.AuthorTracker.comforexclusiveinformationonyourfavorite

HarperCollinsauthor.

Alsoby

MICHAELE.GERBER

E-MythMastery

TheE-MythManager

TheE-MythContractor

TheE-MythPhysician

Copyright

THEE-MYTHREVISITED.Copyright©2007byMichaelE.Gerber.Allrights

reservedunderInternationalandPan-AmericanCopyrightConventions.

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1DepartmentofCommerce.

1AlvinToffler,TheThirdWave(NewYork:WilliamMorrowandCompany,Inc.,1980),pp.390,389.

2AlvinToffler,TheThirdWave,p.389.

3LouisCheskin,WhyPeopleBuy(NewYork:LiverightPublishingCorporation,1959),p.119.

1TheodoreLevitt,MarketingforBusinessGrowth(NewYork:McGrawHill,1974),p.71.

2TheodoreLevitt,MarketingforBusinessGrowth,p.56.

1RolloMay,Man’sSearchforHimself(W.W.Norton&Company,Inc.,1953),p.165.

1JoeHyams,ZenintheMartialArts(LosAngeles:J.P.Tarcher,Inc.,1979),p.12.