the e-myth revisited · part i: the e-myth and american small business chapter 1. the...
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TheE-Myth
Revisited
WhyMostSmallBusinesses
Don’tWorkand
WhattoDoAboutIt
MICHAELE.GERBER
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ToMyFather,
Iwishhewerehere.
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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
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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
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Afterword:TakingtheFirstStep
AbouttheAuthor
OtherBooksbyMichaelE.Gerber
Copyright
AboutthePublisher
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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.
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And,finally,toallmyreaderswhocontinuetosupportmyworkso
enthusiastically.
Thankyouall.
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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.
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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
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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,
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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
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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
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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.
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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
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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
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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.
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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
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havestartedtohappentoyou.
1
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PARTI
TheE-MythandAmericanSmallBusiness
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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.
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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
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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
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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.
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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.
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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).
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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
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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.
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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
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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.”
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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?
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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!
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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.
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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
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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.
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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.
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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
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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.
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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.”
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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
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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.
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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.
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“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
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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
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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.
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“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.”
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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.
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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.
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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
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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!
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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!
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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,
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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
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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.
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“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
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rewardingthanyoucanpossiblyimagineatthispointinyourbusiness’s
life.”
“Tellmemoreaboutthat,”Sarahsaid.“Ireallywanttoknow.”
“Iwill,”Ianswered.“AlthoughIsensethatyoualreadyunderstand
quiteabitmorethanyouthink.Butfirst,let’sgoontoAdolescence,the
secondstageinasmallbusiness’sgrowth.”
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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.
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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
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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!
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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.
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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
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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
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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.
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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.
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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.
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And,intuitively,Iknewwehadjusttakenasnapshotofit.
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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
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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
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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.
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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.
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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.
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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.
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“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.
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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.
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“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.
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“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.
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“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
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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
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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
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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.
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“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?
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“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
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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.
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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.”
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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.
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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
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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.
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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
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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.
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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.
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“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
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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.
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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?”
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Formoreinformation,visitusatwww.e-myth.com
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PARTII
TheTurn-KeyRevolution:ANewViewofBusiness
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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
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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”
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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-
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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.
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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.
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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
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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
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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.
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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
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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
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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.
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“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.
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“Soletmetellyouhowhecraftedsomethingthatsize.”
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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
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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
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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
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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
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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.
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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!
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IcouldseethatSarahgotit.
Icouldseethattheflushonhercheeksnowhadnothingtodowith
theworkshe’dbeendoingallday.
Icouldseethatherdark,intelligent,creativeeyeswererivetedon
mine,andthatthequestionswerebubblingwithinher.Shewasfeeling
excitementcontemplatingthecreationofanentrepreneurialbusiness.
Andsheknewshehadonealready.
ShecoulddoinherbusinesswhatRayKrochaddoneinhis.Allshe
neededtodowaslearnhow!
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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
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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
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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.
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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.
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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.
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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.
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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.
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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.
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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
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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.
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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.
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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
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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
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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
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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.
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“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
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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!
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“Andthegreatthingis,I’vealreadygotthebusiness.AllIhavetodo
nowistolearnhow!”
“Sarah,”Isaid,“Icouldn’thavesaiditanybetter.So,let’sgoontothe
nextstep,theBusinessDevelopmentProcess.Becausewhatyouhaveto
learnisgoingtobeeasierthanyouthink.”
Formoreinformation,visitusatwww.e-myth.com
1
2
3
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PARTIII
BuildingaSmallBusinessThatWorks!
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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.
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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
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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
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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?
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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?
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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.
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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?
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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.
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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.
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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.
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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.
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“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.
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“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
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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
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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
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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.
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“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.
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1
2
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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
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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.
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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
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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
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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?
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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.
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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.
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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
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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
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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
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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
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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
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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
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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
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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,
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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!”
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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
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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
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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.
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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
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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.
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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.
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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
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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?
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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.
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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
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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!
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“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.
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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?”
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“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
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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,
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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
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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.
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“AmIgivingyouatasteofwhatmyStrategicObjectiveis?AmIbeing
clearenough?”
“Sarah,”Ismiled,“youleavemespeechless.”
“Then,what’snext?”sheasked,asshepouredeachofusafreshcup
oftea.
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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.
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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.
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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.
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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.
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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.
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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.
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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
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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
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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.
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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.
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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
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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.
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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.
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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.
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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
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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
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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.
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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
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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.
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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
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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.
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“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?
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“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.”
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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.
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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
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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
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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!
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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.
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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
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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
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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
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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
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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.
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“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.”
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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.
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“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
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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
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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
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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
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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
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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
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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
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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
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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
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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.
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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?
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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.
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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
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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
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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
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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
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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
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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
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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.
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“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.
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“Howwouldanythingbecommunicatedconsistentlyinsucha
business,inwhicheveryformoflanguage,everyideaoforganization,
everykindofprocessandsystemwereexpressedinanindividualand
subjectivewaybyeachandeveryoneofyourpeople,withoutany
standards,withoutanyagreement,withoutanyconsistencyinform—in
fact,withoutanyconsistencyinjudgment?
“Isthatanappealingpicture?”Iasked.
“I’mexhaustedjustthinkingaboutit,”Sarahresponded.
“Iknow,anditisevenworsethanyoucanimagine.
“ButaManagementSystemissomethingelseagain.Andwhenitis
combinedwithawell-conceivedMarketingSystem…”
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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
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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
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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
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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
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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
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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?
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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?
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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!
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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.
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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.
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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.
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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.
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“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.
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“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
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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.
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“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
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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
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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.”
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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.
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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.
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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
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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.
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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
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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.
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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.
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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?”
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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
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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:
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“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.
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“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.
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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
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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!
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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
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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
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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.
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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.
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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
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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.
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“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.
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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?
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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
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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
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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
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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.
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MichaelE.Gerber
1
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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.
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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
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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.
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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.
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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!
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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.
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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
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ofman.
But,Iaskyounottothinkaboutitanymore.
It’stimetoact.
Becauseuntilyoudo,youwon’tunderstandit.
Andwhenyoudo,therewillbenothinglefttothinkabout—you’llbe
wellonyourway.
Untilthen,it’sjustanothergoodidea,justanothercreativethought.
It’stimetoturnitintoaninnovation.
It’stimetoBringtheDreamBacktoAmericanSmallBusiness.
It’sbeengonefartoolong.
1
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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.
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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
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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:[email protected].
Visitwww.AuthorTracker.comforexclusiveinformationonyourfavorite
HarperCollinsauthor.
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Alsoby
MICHAELE.GERBER
E-MythMastery
TheE-MythManager
TheE-MythContractor
TheE-MythPhysician
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Copyright
THEE-MYTHREVISITED.Copyright©2007byMichaelE.Gerber.Allrights
reservedunderInternationalandPan-AmericanCopyrightConventions.
By payment of the required fees, you have been granted the non-
exclusive,non-transferablerighttoaccessandreadthetextofthise-book
on-screen.No part of this textmay be reproduced, transmitted, down-
loaded,decompiled, reverse engineered,or stored inor introduced into
any information storage and retrieval system, in any form or by any
means, whether electronic or mechanical, now known or hereinafter
invented, without the express written permission of HarperCollins e-
books.
EPub©EditionMAY2007ISBN:9780061741654
10987654321
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AboutthePublisher
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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.