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Revisiting the E-Myth

emyth.jpgThe problem with most small-business owners, Michael Gerber famously wrote in his book, The E-Myth, is that they're technicians, not managers. In other words, they can bake a great cake but couldn't run a bakery if their lives depended on it.

Turns out that cake-baking (or plumbing, hair styling or bookkeeping) is a good skill to have these days.

With most small businesses stuck in neutral because of sluggish sales and scant access to credit, many business owners are rolling up their sleeves and doing the jobs they paid other people to do before the recession hit two years ago. Not only does this drive more dollars to the bottom line, but it also reduces the burden of payroll taxes, health insurance and worker's comp and lets the owners deal directly with the customers who hired them for their technical skills in the first place.

While I haven't seen any statistics to back this up, I can tell you from what I'm seeing at my own small-business consulting firm that most of my clients with technical skills are using them to keep their businesses afloat. Whether it's the software developer who's writing his own code, the chocolatier who's filling her own gift baskets or the landscaper who's mowing his own lawns, these business owners aren't hiring employees to do the job. Instead, they're picking up the slack themselves and banking the money they earn until they're convinced that the economy is headed in the right direction again.

Now, don't get me wrong, I'm not suggesting that you abandon the American Dream of starting a business, hiring someone to replace you, and spending the rest of your life relaxing on a beach with a mojito, What I am saying is that a small business run by a guy who knows how to bake his own cakes has a better chance of survival than a company run by a CEO who wouldn't know a croissant if he bit into one.

Rosalind Resnick is a New York-based freelance writer, entrepreneur, investor and author of The Vest Pocket Consultant's Secrets of Small Business Success.

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