When Michael E. Gerber introduced the E-myth principles to the world in his seminars, consulting services and books, it may have been obscure to relate such ideas to our industry. However, if you have had the opportunity to read his updated "The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It," you will quickly see that the message directly relates to our industry and cuts to the very core of most of our problems in business.

I work with clients all over the world, and this book is required reading for our clients. Why? It is not because the main example in the book - of a pie-making company - is riveting and inspirational. What this company faces is an example of what all small business owners must go through to grow and move to the next level in their business development. We have found this to be so true in the automotive service industry as well.

What's an E-myth?

Many ask if an E-myth relates to e-commerce, e-business, the electronic age or even energy. The "E" stands for "entrepreneur." It is a great beginning to understanding why the harder you seem to work, the less you seem to accomplish.

The E-myth is about entrepreneurs, and it basically involves how the struggle takes place each day within an owner's mind and the actions that affect the company's future and growth.

The Struggling Partners

Business owners have many "hats" that they wear each day. They also have internal business partners who divide all of these "hats" between three definitive personal psyches: the entrepreneur, manager and technician. The three coexist within your mind, but they battle each other in how you will handle the daily problems, decisions and business direction. They have unique qualities that can complement each other, but each psyche may also attempt to dominate the others, which can hinder business growth.

The entrepreneur: The entrepreneurial spirit is what drove you into business. It's the spark that told you that you didn't need to work for "him" any longer and you can do it better. Many owners look back now and realize it isn't as easy as it seemed at that moment. Many look at it as the best decision they've ever made.

This entrepreneurial psyche is critical in taking risks and making changes. The way this industry is changing today, it is even more needed. The changes are opportunities that are there, and your "entrepreneurial spirit" will allow you to embrace these.

But be aware that it can lead to chaos and projects that never get finished, over-budget expenses, loss of staff and failed business ventures. It is the perfect example of "seat of the pants" management. It is also very important to know when to use these traits and when not to during the business maturing cycle.

The manager: This portion of your psyche looks at the operations and wants order and accountability. The processes that you have implemented successfully come from this internal partner. It also "hates" when the entrepreneur makes decisions since it must usually "clean up the mess" once the direction is set.

This psyche is not a risk taker without proper documentation, accurate financial information and a plan. The "entrepreneurial spirit" will always have little patience with the methodical process that the manager wishes to practice.

The manager's side is absolutely critical in expanding most small businesses today. The ability to have systems in place and delegate is the only way a small business can succeed and grow. Otherwise, the business owner will explode!

However, if this area becomes too dominant, it may hinder a small business owner from taking advantage of opportunities and making changes. The manager psyche likes systems and procedures to stay the same. We have found many clients who have built systems that are inflexible and cannot be changed for the needs of the business.

The technician: This portion of your psyche is the key to your early success and probably your biggest detriment to your future. We have found many of our clients have this psyche as their greatest strength and by far their greatest weakness.

This psyche understands the process of your service inside and out. It looks at every operation as if it was to be performed by them. The tendency of this psyche, if it dominates the business decisions, is to purchase the most up-to-date tech tools and shop equipment while the computers and other equipment are ancient.

A common response to updating equipment is, "If it can't make me more money while fixing the car, it isn't worth it!" This belief will always hinder the growth of the business at a certain point in the business life cycle.

Today, the most common areas of change that are needed revolve around understanding that the business is a "sales organization" first and not a "service organization." To the technician psyche, this cannot easily be accepted. The technician side remembers when he performed the work, wrote the estimates, delivered the vehicles and did all of the paperwork. To this psyche, the most important part about the business is to "repair the vehicle."

Common traits we see that are driven by the "technician psyche" are:

• Not purchasing a management system.
• Not participating in local trade associations and events.
• Not participating in local community associations and boards.
• Not establishing a solid accounting system and getting timely reports.
• Having tremendous staff turnover (especially production).
• Working 70+ hours per week year after year without ever taking a vacation.
• Frustration with the business and how complex it has become.
• Belief that sales volume cannot be increased without sacrificing quality.
• Denial that there can be systems implemented to improve the processes.

Solutions Are There if You Look

Every day, we are faced with challenges that require a "specialist" to perform their service. During the repair process we do this many times. It is easy to understand the need for a specialist in the repair process - something that the "technician" can clearly see. It is not so clear, however, to many business owners when a specialist is needed to assist in "running your business."

As mentioned earlier, books and tapes are a start, and they can steer you in the right direction. Seminars are also a beginning and can be valuable to you and your key staff. We are not referring to the normal "technical seminars' that you probably send your staff to, but business development and management seminars. They are offered by your vendors and from other industry sources. We have found that once we can get the owner and key staff to seminars, they begin to understand the frustrations they are having. They see the "bigger picture" and learn about solutions to some of their business challenges.

Does your staff cringe every time you tell them you are reading a new business book or going to a seminar? They know that when you're finished, you will be coming in to "change their world."

To make these changes will require you to be a good business coach to set strategies, implement changes, train your staff and perform accountability assessments on a regular basis. This is a process that is often overlooked. It is amazing how much can be done to improve a business, but often, we miss the opportunity.

Conclusion

Today, whether you personally can repair the vehicle, turn a wrench or bake a pie, is much less important than whether you have a clear vision of your future, train people to do it "your way," get sales in the door and maintain a high customer satisfaction index. To accomplish this requires systems (manager) and sales skills (entrepreneur) as well as being able to see the opportunities available and to act upon them.

A common phrase we use often to improve your business is, "You must be able to work on your business, rather than in your business." To accomplish this requires understanding the three psyches and how if the technician dominates, you will always be working in your business.

The correct balance can be achieved. It might require taking off the blinders and chains to accomplish it or "firing" the technician!

Editor's note: This article is one of several management articles that will be contributed to AutoInc. this year by Automotive Management Institute (AMI) instructors. To learn more about AMI, its courses and instructors, visit www.AMIonline.org. Tony Passwater, president of AEII, has been in the collision industry since 1972. AEII is an international consulting, training and system development organization founded in 1986. AEII has worked with collision shop owners worldwide and developed and provided computer solution software programs, training seminars and on-site consulting services for many of the top organizations. Passwater can be contacted at Tony.Passwater@aeii.net or www.aeii.net.

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