Mindset 3 – Working ON or IN your business
The concept of working ON and IN your business was introduced by Michael Gerber in his book The E Myth.
In the book Gerber shares his view that most people who go into business are not entrepreneurs but technicians suffering from an entrepreneurial seizure.
A painter opens a decorating firm, a mechanic a garage and an accountant opens an accountancy business. I think it’s fair to say we have all done that but the key is being conscious of it and not getting caught “IN” the business.
Working ON the business includes strategy, business planning, growing the business, developing and refining the systems as well as training and coaching employees.
Working IN the business is doing the work of the business.
Working ON and IN are two very different activities. When we work ON the business we zoom out and see the business as a whole. We may be working IN the business but we understand we are not the business.
According to Gerber, the role of a business owner is to create a picture of the finished business and to then go to work to build the business.
This includes know what type of customers you want and how many you need, how much you charge each client on average, what it costs to deliver and the resulting profit.
With this mindset you can now see your role as a business builder. When you get up and go to work you are not going to do the work, you are going to work to build a business that one day will be £500,000, £1m, £10 or £100m.
You may have to start doing the work but while you do this you can be developing systems so later someone else can do the work and do it like you do.
It is important to understand that being good at doing the work of the business is very different from being good and doing the work ON the business.
Being a good accountant has very little to do with building and managing an accountancy business. Sometimes the skills are in conflict.
Take me as an example, growing a business involves risk, doing the accounting work is about being prudent. And, building a business we need to be good at sales and marketing – most accountants admit they are not these activities.
Gerber suggests you think about your business as though you were about to write a book. What would that book of yours say? What would you, as the author of your book, wish to impart to your reader that would hopefully transform the way they think about their life, about their success, about their future?
It’s why causes are important to entrepreneurs. Causes add dimensionality to your business. Causes add meaning to your business, beyond simply making money.
As we go to work on our business, we must think beyond what the day-to-day reality of our business calls you to do. As an entrepreneur, we must rise above the stuff of doing it, doing it, doing it.
It means we must ask meaningful questions about our role in the world, our community, and how we can ingrain our new-found perspective into the DNA of our business, so that it lives, speaks, and demonstrates it in every action our business takes.
When we have the mindset of working “ON” the business we understand who our important customer is.
Is it your first? Is it your biggest or most profitable? Is it the one who is most connected and refers the most?
No. Our most important customer is the one that buys our business!
That could be someone who buys it from you or it could be YOU – because we buy our business every day by going to work IN it. Is it enjoyable? Is it profitable?
With this mindset we can think of our business as a product. Our job is to develop a product so great that people want to buy it.