Many of the small businesses and businesses do not survive beyond their first year, one might think that the cause is the lack of hard work on the part of the owner, but it is not so, the main problem is not the laziness of small entrepreneurs, in reality these the latter work incessantly but do it the wrong way.
In this book we will not talk about “how to” build a successful business but about the idea behind it, the idea that drives us to consider such work valid and worthy, in other words we must change ourselves first if we want the business to be successful.
Fundamental ideas for an activity to be successful
There are four fundamental ideas that underlie the creation of this activity:
1. The ‘ E-Myth, that is, the “entrepreneurial myth” is the basis of the failure of most of the activities. According to this myth, small businesses are started by entrepreneurs who risk capital to make a profit. This idea is absolutely wrong, understanding it is the first step towards a successful business.
2. Embrace the idea of the turnkey revolution, which is radically changing the way we start businesses around the world.
3. At the basis of this new revolution is the Business Development Process (as identified in E-Myth Worldwide: Business Development Process ), thanks to which any business can be made efficient.
4. The business development process can be integrated and applied in a systematic way, incorporating the concepts of the turnkey revolution, in any small business to produce predictable results.
The “entrepreneurial myth”
At the basis of the “entrepreneurial myth” there is a misunderstanding: it is believed that anyone who opens a small business is an entrepreneur, but in reality it is not so. Of course at the start of any business there is a vision, a dream that our entrepreneurial side tries to put into effect but the reality is that the entrepreneur exists only for a moment and survives precisely because of the misunderstanding that underlies the starting a business.
First of all we must understand that usually those who start a business start from the wrong assumption that if you understand the technical side of a service then you understand the business that offers it. Another problem is that whoever opens a business has three different personalities:
- the entrepreneur , our creative and visionary part, always ready for innovation;
- the manager , the one who creates order and without whom there would be no activity;
- the technician , the party who has the necessary skills to perform the job.
These three personalities work best if they do it in a symbiotic way but this rarely happens, most of the time the prevailing personality is that of the technician.
Over time, any small business grows and changes through three different phases which it is good to analyze to understand how to achieve success:
- childhood , during this phase the owner and the business are one. This period ends when the business reaches the point of being too large to be managed by a single person.
- adolescence, this phase begins when you realize that you need extra help in your business. At this point there are two possible results for the personality of the technician who has become an entrepreneur. The activity in the adolescent phase makes the technician uncomfortable because he cannot control the chaos resulting from the lack of the manager, therefore the owner himself decides to reverse the process of growth of the activity and return to the initial reduced size. Another possibility is self-destruction: the business grows so much that the technician and his helpers can no longer manage it. However, the most tragic possibility is survival. If an activity in the adolescent phase survives in the hands of the technician’s personality, the owner alone will make the consequences.
- Maturity , the last phase of the growth of an activity is not the result of the systematic and assured growth of the other two phases, many of the companies that have reached maturity have in fact faced the first two phases with a perspective that is not that of the technician but the entrepreneur. The business model is not the vision of the business to be created but of the customer to be satisfied, this is the concept behind a successful company. To create a model that balances the three personalities, it is necessary to analyze the revolution that has transformed the world of small businesses: the turnkey revolution.
The turnkey revolution
The turnkey revolution provides a balanced model to create an effective and successful business, it is the franchise business model that revolutionized the world of small businesses and businesses starting with McDonald’s in 1952.
This model provides an activity with the complete methodology of creating an effective and efficient work chain in which not a product is sold but the name of the activity itself. Ray Kroc, the creator of the McDonald’s franchise , has created a model that works independently of who uses it, a model that depends on a system and not on the people who manage it, a system based on predictable components and tested before the production of massa, the big secret of the franchise business model: the prototype of the franchise.
The franchise prototype is a system that provides the solution to all problems, its keywords are discipline, standardization and order, and it provides a balanced model in which the three personalities can coexist and thrive.
In the franchise game there are rules to follow:
- the model must provide constant and greater value than the expectations of customers, suppliers and employees;
- the model must depend on employees with low-level skills, so that it is easy to replicate;
- the model must stand out for its impeccable order;
- the execution of all the operations must be documented;
- the model must provide a predictable and uniform service to customers;
- the model must use a dress code, colors and uniform structure.
A successful business
The business development process is the basis for the creation of a prototype and is made up of three different activities: