Michael E. Gerber

Once you recognize that the purpose of your life is not to serve your business, but that the primary purpose of your business is to serve your life, you can then go to work on your business, rather than in it.

The system isn’t something you bring to the business. It’s something you derive from the process of building the business.

Your business is nothing more than a distinct reflection of who you are.

Innovation continually poses the question: What is standing in the way of my customer getting what he wants from my business?

A business is like a martial arts practice hall, a dojo, a place you go to practice being the best you can be.

Orchestration is the elimination of discretion, or choice, at the operating level of your business.

Comfort overtakes us all when we’re least prepared for it. Comfort makes cowards of us all.

Because if you’re working all the time devoting all your energy in your business, you won’t have any time or energy left to ask, let alone answer, all of the absolutely critical questions you need to ask.

A system is a set of things, actions, ideas, and information that interact with each other, and in so doing, alter other systems.

The problem is that everybody who goes into business is actually three-people-in-one: The Entrepreneur, The Manager, and The Technician.

An Entrepreneur does the work of envisioning the business as something apart from you, the owner.

Mobs do not get things done, they destroy things.

Someone’s got to be accountable. Someone’s got to be in charge.

The system produces the results; your people manage the system.

The problem with most failing businesses I’ve encountered is not that their owners don’t know enough about finance, marketing, management, and operations—they don’t, but those things are easy enough to learn—but that they spend their time and energy defending what they think they know.

In short, everything is a system. The universe, the world, San Francisco Bay, the office I’m sitting in... they’re all systems.

Meaning... is the product of caring, not vice versa. What we care about we value.

The chaos isn’t 'out there' in everyone else. It’s not 'out there' in the world. The chaos is 'in here' in you and me.

Work on your business, not just in it.

The E-Myth is the myth of the entrepreneur. It runs deep in this country and rings of the heroic. Picture the typical entrepreneur...

A business that looks orderly says to your customer that your people know what they’re doing.

It is literally impossible to produce a consistent result in a business that depends on extraordinary people.

Discretion is the enemy of order, standardization, and quality.

Without improvement, there would be no reason to be. We would be machines.

Life is what a business is about, and life is what this work is about.

If everybody’s doing everything, then who’s accountable for anything?

Your Organization Chart flows down from your Strategic Objective, which in turn flows down from your Primary Aim.

The Entrepreneur is our creative personality—always at its best dealing with the unknown, prodding the future, creating probabilities out of possibilities, engineering chaos into harmony.

Caring will be the true product of my business, not pies.

The purpose of going into business is to get free of a job so you can create jobs for other people.

The Manager builds a house and then lives in it, forever. The Entrepreneur builds a house and the instant it’s done begins planning the next one.

Simply put, your job is to prepare yourself and your business for growth.

Any plan is better than no plan. Because in the process of defining the future, the plan begins to shape itself to reality.

The first question you must ask, then, is: Who are they? Who are my customers, specifically? What is their Demographic Profile?

You have to become a student of the art of business and the science of business. And that's the 'what to do' part of all this.

The problem is not that the owners of small businesses don’t work; the problem is that they’re doing the wrong work.

All the logic does is give your people the rational armament to support their emotional commitment.

The game needs to be fun from time to time. Note that I said, from time to time.

Life is what a business is about, and life is what this work is about. Coming to grips with oneself, in the face of an incredibly complex world that can teach us if we’re open to learn.

The true genius of Ray Kroc’s McDonald’s is the Business Format Franchise.

Without an Organization Chart, everything hinges on luck and good feelings... the recipe for chaos and disaster.

The system will become your solution to the problems that beset you because of the unpredictability of your people.

What you do in your model is not nearly as important as doing what you do the same way, each and every time.

Orchestration is the glue that holds you fast to your customers’ perceptions.

Your Strategic Objective is a very clear statement of what your business has to ultimately do for you to achieve your Primary Aim.

The fatal assumption is: if you understand the technical work of a business, you understand a business that does that technical work.

The greatest businesspeople I’ve met are determined to get it right no matter what the cost.

If your thinking is sloppy, your business will be sloppy. If you are disorganized, your business will be disorganized.

You can’t ‘have your pie and eat it too.’ You can’t ignore the financial accountabilities, the marketing accountabilities, the sales and administrative accountabilities.

The thrill of the craft is to discover the jewel. And there is only one way to discover it: to practice the craft mindlessly.

What do I value most? What kind of life do I want? What do I want my life to look like, to feel like?

If you haven’t orchestrated it, you don’t own it. And if you don’t own it, you can’t depend on it.

The problem with most failing businesses I’ve encountered is not that their owners don’t know enough about finance, marketing, management, and operations... but that they spend their time and energy defending what they think they know.

The Turn-Key Revolution...is changing who goes into business, how they do it, and the likelihood of their survival.

The typical small business owner is only 10 percent Entrepreneur, 20 percent Manager, and 70 percent Technician.

Go to work on your business rather than in it, and ask yourself the following questions: How can I get my business to work, but without me?

The Franchise Prototype is the answer to the perpetual question: 'How do I give my customer what he wants while maintaining control of the business that’s giving it to him?

The system runs the business. The people run the system.

The technical work of a business and a business that does that technical work are two totally different things!

If your business depends on you, you don’t own a business—you have a job.

The Entrepreneurial Myth

The book debunks the common misconception that technical expertise alone can lead to business success. Michael E. Gerber explains that many small business owners fall into the trap of believing that their technical skills will automatically translate into business acumen. This 'Entrepreneurial Seizure' often leads to failure because running a business requires a different set of skills, including management and strategic planning. As Gerber puts it, 'The fatal assumption is: if you understand the technical work of a business, you understand a business that does that technical work.'

Balancing Roles: Entrepreneur, Manager, and Technician

Gerber emphasizes the importance of balancing the roles of Entrepreneur, Manager, and Technician within a business. Each role has distinct responsibilities and requires different skills. The Entrepreneur focuses on innovation and vision, the Manager on order and systems, and the Technician on hands-on work. The conflict between these roles can lead to business failure if not managed properly. 'The problem is that everybody who goes into business is actually three-people-in-one: The Entrepreneur, The Manager, and The Technician,' Gerber explains.

The true product of a business is the business itself.

Working On Your Business, Not In It

A key idea in the book is the importance of working on your business rather than in it. This means focusing on strategic planning and system development rather than getting bogged down in daily operations. Gerber argues that business owners should create systems that allow the business to run independently of their constant involvement. 'Your business is not your life. Your business and your life are two totally separate things,' he asserts, emphasizing the need for a clear separation between personal and business roles.

The Power of Systems

Gerber highlights the critical role of systems in ensuring business success. He explains that a well-designed system can transform a business from being people-dependent to being systems-dependent, ensuring consistent and reliable performance. 'The system produces the results; your people manage the system,' he states. This approach allows businesses to scale and maintain high standards without relying on the whims of individual employees.

The Franchise Prototype

The concept of the Franchise Prototype is central to Gerber's philosophy. He argues that businesses should be designed as if they were going to be franchised, with every aspect of the operation documented and standardized. This ensures that the business can be replicated and scaled efficiently. 'The true product of a business is the business itself,' Gerber explains, emphasizing that the business model should be the primary focus, not just the products or services it offers.

Aligning Business with Personal Goals

Gerber stresses the importance of aligning your business with your personal goals and values. He introduces the concept of the 'Primary Aim,' which involves defining what you want out of life and ensuring that your business helps you achieve these goals. 'What do I value most? What kind of life do I want? What do I want my life to look like, to feel like?' These questions guide business owners in creating a business that serves their life, rather than the other way around.

Delegate, Don't Abdicate

When hiring employees, ensure you remain actively involved in overseeing operations and providing clear guidance. Delegating should not mean transferring all responsibility without oversight.

Create Clear Roles and Responsibilities

Develop a clear organization chart for your business, even if it’s just you filling all the roles initially. This helps in assigning clear responsibilities and preparing for future scaling.

Standardize Processes for Consistency

Ensure that all operations in your business are standardized to eliminate variability. Create manuals and training programs that outline the exact steps needed for common tasks.

Gather Customer Data Actively

Implement questionnaires or surveys with incentives (like a free product or discount) to understand customer demographics and psychographics comprehensively. This will help you tailor your marketing strategies effectively.

Align Business Goals with Personal Vision

Regularly reflect on your broader life goals and how your business fits into this vision. Define your Primary Aim and make sure that every business decision supports this aim.

If your business depends on you, you don’t own a business—you have a job. And it’s the worst job in the world because you’re working for a lunatic!

The real tragedy is that when the technician falls prey to the Fatal Assumption, the business that was supposed to free him actually enslaves him.

The technician suffering from an Entrepreneurial Seizure takes the work he loves to do and turns it into a job.

In short, you would see how The Entrepreneur in you dreams and schemes, The Manager in you is constantly attempting to keep things as they are, and The Technician in you drives the other two crazy.

Infancy ends when the owner realizes that the business cannot continue to run the way it has been; that, in order for it to survive, it will have to change.

You can’t ignore your future employees’ need for leadership, for purpose, for responsible management, for effective communication, for something more than just a job in which their sole purpose is to support you doing your job.

True trust comes from knowing, not from blind faith.

IBM is what it is today for three special reasons. The first reason is that, at the very beginning, I had a very clear picture of what the company would look like when it was finally done.

Unlike most small business owners before him—and since—Ray Kroc went to work on his business, not in it.

Once you recognize that the purpose of your life is not to serve your business, but that the primary purpose of your business is to serve your life, you can then go to work on your business, rather than in it.

The system isn’t something you bring to the business. It’s something you derive from the process of building the business.

Your business is nothing more than a distinct reflection of who you are.

Innovation continually poses the question: What is standing in the way of my customer getting what he wants from my business?

A business is like a martial arts practice hall, a dojo, a place you go to practice being the best you can be.

Orchestration is the elimination of discretion, or choice, at the operating level of your business.

Comfort overtakes us all when we’re least prepared for it. Comfort makes cowards of us all.

Because if you’re working all the time devoting all your energy in your business, you won’t have any time or energy left to ask, let alone answer, all of the absolutely critical questions you need to ask.

A system is a set of things, actions, ideas, and information that interact with each other, and in so doing, alter other systems.

The problem is that everybody who goes into business is actually three-people-in-one: The Entrepreneur, The Manager, and The Technician.

An Entrepreneur does the work of envisioning the business as something apart from you, the owner.

Mobs do not get things done, they destroy things.

Someone’s got to be accountable. Someone’s got to be in charge.

The system produces the results; your people manage the system.

The problem with most failing businesses I’ve encountered is not that their owners don’t know enough about finance, marketing, management, and operations—they don’t, but those things are easy enough to learn—but that they spend their time and energy defending what they think they know.

In short, everything is a system. The universe, the world, San Francisco Bay, the office I’m sitting in... they’re all systems.

Meaning... is the product of caring, not vice versa. What we care about we value.

The chaos isn’t 'out there' in everyone else. It’s not 'out there' in the world. The chaos is 'in here' in you and me.

Work on your business, not just in it.

The E-Myth is the myth of the entrepreneur. It runs deep in this country and rings of the heroic. Picture the typical entrepreneur...

A business that looks orderly says to your customer that your people know what they’re doing.

It is literally impossible to produce a consistent result in a business that depends on extraordinary people.

Discretion is the enemy of order, standardization, and quality.

Without improvement, there would be no reason to be. We would be machines.

Life is what a business is about, and life is what this work is about.

If everybody’s doing everything, then who’s accountable for anything?

Your Organization Chart flows down from your Strategic Objective, which in turn flows down from your Primary Aim.

The Entrepreneur is our creative personality—always at its best dealing with the unknown, prodding the future, creating probabilities out of possibilities, engineering chaos into harmony.

Caring will be the true product of my business, not pies.

The purpose of going into business is to get free of a job so you can create jobs for other people.

The Manager builds a house and then lives in it, forever. The Entrepreneur builds a house and the instant it’s done begins planning the next one.

Simply put, your job is to prepare yourself and your business for growth.

Any plan is better than no plan. Because in the process of defining the future, the plan begins to shape itself to reality.

The first question you must ask, then, is: Who are they? Who are my customers, specifically? What is their Demographic Profile?

You have to become a student of the art of business and the science of business. And that's the 'what to do' part of all this.

The problem is not that the owners of small businesses don’t work; the problem is that they’re doing the wrong work.

All the logic does is give your people the rational armament to support their emotional commitment.

The game needs to be fun from time to time. Note that I said, from time to time.

Life is what a business is about, and life is what this work is about. Coming to grips with oneself, in the face of an incredibly complex world that can teach us if we’re open to learn.

The true genius of Ray Kroc’s McDonald’s is the Business Format Franchise.

Without an Organization Chart, everything hinges on luck and good feelings... the recipe for chaos and disaster.

The system will become your solution to the problems that beset you because of the unpredictability of your people.

What you do in your model is not nearly as important as doing what you do the same way, each and every time.

Orchestration is the glue that holds you fast to your customers’ perceptions.

Your Strategic Objective is a very clear statement of what your business has to ultimately do for you to achieve your Primary Aim.

The fatal assumption is: if you understand the technical work of a business, you understand a business that does that technical work.

The greatest businesspeople I’ve met are determined to get it right no matter what the cost.

If your thinking is sloppy, your business will be sloppy. If you are disorganized, your business will be disorganized.

You can’t ‘have your pie and eat it too.’ You can’t ignore the financial accountabilities, the marketing accountabilities, the sales and administrative accountabilities.

The thrill of the craft is to discover the jewel. And there is only one way to discover it: to practice the craft mindlessly.

What do I value most? What kind of life do I want? What do I want my life to look like, to feel like?

If you haven’t orchestrated it, you don’t own it. And if you don’t own it, you can’t depend on it.

The problem with most failing businesses I’ve encountered is not that their owners don’t know enough about finance, marketing, management, and operations... but that they spend their time and energy defending what they think they know.

The Turn-Key Revolution...is changing who goes into business, how they do it, and the likelihood of their survival.

The typical small business owner is only 10 percent Entrepreneur, 20 percent Manager, and 70 percent Technician.

Go to work on your business rather than in it, and ask yourself the following questions: How can I get my business to work, but without me?

The Franchise Prototype is the answer to the perpetual question: 'How do I give my customer what he wants while maintaining control of the business that’s giving it to him?

The system runs the business. The people run the system.

The technical work of a business and a business that does that technical work are two totally different things!

If your business depends on you, you don’t own a business—you have a job.

The true product of a business is the business itself.

If your business depends on you, you don’t own a business—you have a job. And it’s the worst job in the world because you’re working for a lunatic!

The real tragedy is that when the technician falls prey to the Fatal Assumption, the business that was supposed to free him actually enslaves him.

The technician suffering from an Entrepreneurial Seizure takes the work he loves to do and turns it into a job.

In short, you would see how The Entrepreneur in you dreams and schemes, The Manager in you is constantly attempting to keep things as they are, and The Technician in you drives the other two crazy.

Infancy ends when the owner realizes that the business cannot continue to run the way it has been; that, in order for it to survive, it will have to change.

You can’t ignore your future employees’ need for leadership, for purpose, for responsible management, for effective communication, for something more than just a job in which their sole purpose is to support you doing your job.

True trust comes from knowing, not from blind faith.

IBM is what it is today for three special reasons. The first reason is that, at the very beginning, I had a very clear picture of what the company would look like when it was finally done.

Unlike most small business owners before him—and since—Ray Kroc went to work on his business, not in it.