Sunday, December 2, 2007

Why Some Small Businesses Fail

Photo by aeu04117.

In The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It, Michael E. Gerber, writes about how an individual starting a small business can fail, if they don't balance The Enterpreneur, The Manager, and The Technician inside them.

The Wrong Balance
Gerber writes:

"The fact of the matter is that we all have an Entrepreneur, Manager, and Technician inside us. And if they were equally balanced, we'd be describing an incredibly competent individual.

The Entrepreneur would be free to forge ahead into new areas of interest; The Manager would be solidifying the base of operations; and The Technician would be doing the technical work. Each would derive satisfaction from the work he does best, serving the whole in the most productive way.

Unfortunately, our experience shows that few people who go into business are blssed with such a balance. Instead, the typical small business owner is only 10 percent Entrepreneur, 20 percent Manager, and 70 percent Technician."

The Wrong Person at the Helm
Gerber writes:

"The Entrepreneur wakes up with a vision.

The Manager screams "Oh, no!"

And while the two of them are battling it out, The Technician seizes the opportunity to go into business for himself. Not to pursue the entrepreneurial dream, however, but to finally wrest control of his work from the other two.

To The Technician it's a dream come true. The Boss is dead.
But to the business it's a disaster, because the wrong person is at the helm.

The Technician is in charge!"

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