How to see through a job disguised as a business …

The best way to give up your ‘day job’ is to watch my Live Show this Thursday @ 8pm CST (9pm EST / 6pm PST) at ….


Lots of people come up to me to proudly tell me about their wonderful, growing businesses … how do I look them in the eye and tell them that I really think that what they have is actually a job?

… and, no, I’m not just talking about the obvious: the accountant, doctor, attorney who earns an income from their own labor, whether individually or in a partnership.

Anthony asked me to post on this (I had said I might … so, I guess he was just encouraging me!), when I mentioned in a recent post that I would comment on this exact topic: 

You should. I want to start my own business in an artistic field and every-time I think of having an employee create my vision, I shudder, just a little bit. That’s where modelling someone comes in. Model those who were able to export their vision to other people.

To me the difference between a ‘job disguised as a business’ and a ‘true business’ is:

1. Could it run 3 months without you?, and

2. Can you sell it?

The first point is self-evident: no employees/partners = no ability to run without you (unless, you can totally automate your business … in which case, call me … I want in!).

Therefore, no business!

The second point is a bit more subtle: if the business is not saleable (a) it probably also fails the first point (i.e. no employees), and (b) you are tied to the business and it is tied to you … when you stop, the business stops … when the business stops (market changes, product life-cycles end, etc.) … you (at least your income) stops.

To me, that’s a job; sure, it’s a flexible job with extra benefits … but, a job none-the-less, just like that ‘self-employed’ accountant/doctor/etc.

Now, how do you make a ‘glorified job’ into a true business?

First, you create Positions in your company!

Now, the business may be you, your Mom and your Dad (that’s a whole series of other posts right there!) … but, if you are going to morph into something that meets our two requirements (i.e. runs without you; and, is saleable), then you are going to need to create a simple Management Structure:

CEO (the gal who runs the show); CFO (the guy who runs the finances); Sales/Marketing Manager (the guy who brings in the business) … right on down to Mail Girl.

If there’s only one, two, or three of you … well, you’re each going to be wearing lots of hats for a while. The key is, though, that each ‘hat’ (i.e. position) has only ONE person who wears it! Only ONE of you gets to be CEO (now, I let me know when you have your first Owner’s Meeting … I sure want to be a fly-on-the-wall wall for that!).

Now, for small businesses it can be very difficult to understand this concept, so try this one one:

When the OWNERS walk in the door, they become EMPLOYEES … when they leave at the end of the day, they become OWNERS again. Simple … critical!

Next you create Systems!

You need to get down and document absolutely everything that you (and everybody else!) does in the business.

As Michael Gerber (whose ground-breaking book, The E-Myth Revisited, taught me everything that I know about business!) says, you should act as though your business is a prototype and that one day there will be 500 more just like it.

Even if your little store is ever going to be the only one, this step will allow you to easily grow and add staff, and sell the business … because the purchaser will see how well everything is documented.

Of course, if you’re like me, you could never believe that your business can run without you … here’s how I learned otherwise:

In the early days of one of my businesses, every file would come to me for approval … now, I had experts – trained in the field in which we were operating (compared to me: I was self-taught when I decided to get into that particular business!) – yet, I still checked every major file.

Eventually, my staff stopped bringing me every file … gradually, at first (they’d ‘forget’ to bring me one here and another one there).

When I didn’t notice – because I was so damn busy, running myself ragged doing ‘other stuff’ – they conveniently ‘forgot’ to bring more and more files to me until, they stopped bringing any to me for approval at all!

If I had noticed, would I have got so upset that I would have fired somebody? Probably. Ego does that.

Did the business run any worse after they stopped bringing me the files? Of course not … I said they were trained, and I wasn’t! I just needed a lesson in faith and trust.

So, that’s how I was gently pushed out of Operations and never again stepped a foot back in … in ANY of my  businesses.

But, I was CEO … without me at the helm the business would hit the rocks and sink … or, so I thought:

A year or two later, I closed on an opportunity to acquire a business in the USA, requiring me to move countries. I decided to move to the USA (where we’ve been ever since) as this would be a much bigger business – but, at the time, I wasn’t selling any of my overseas interests.

So, I did the responsible thing: I hired a replacement CEO months ahead of my planned relocation …

… who decided to leave less than 6 weeks before my departure for the USA!

Luckily, after a frantic phase of executive search that consisted of me calling the only guy that I thought could do the job (even though he had no direct industry experience) and him saying ‘yes’ immediately (phew!), I found somebody who could start exactly 4 weeks before I was leaving … remember, this is a business that COULD NOT POSSIBLY run without me, and here I was putting in ‘New Guy’ with only 4 weeks ‘training’!

Needless to say, he took over seamlessly, didn’t miss a beat, never called me about ANYTHING (bruised ego on my side!) and, not only did he keep the business running, keep the staff happy, and keep the clients equally happy, he damn well GREW the business!

In his favor, he did have Positions all neatly laid out and filled before he joined, and he did have a whole Operating Manual full of Systems that worked …

… and, in my favor, I had a business not a job! How do I know for sure?

Not too long after, I found a buyer …

How about you? Do you have a business or a glorified job?

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14 thoughts on “How to see through a job disguised as a business …

  1. I had a very successful computer business. I was working 80 hours a week, and it was my whole life. It was not so fun. I wanted much more with my life, so I started to replace myself. I first started by finding people who could do what I did the same or better. This let my focus on other things. I soon took this too far, spending only 20 or so hours a week working on this business, the rest of the time doing other things and working at my church. I also started a few more businesses on the side. Everything was good, then I really started taking it far, I decided that I liked to travel so I soon was spending weeks at a time away, they could still call me but that was about it.

    I had put systems in place, the only problem was that I did not put systems to watch the people managing the systems. My flaw was that I thought everyone was like me…honest and money motivated. So I put in place a system where an honest person could make a lot of money by doing fun work that helped people. The problem I found was that most people are NOT money motivated, when they have enough money they stop working, and second I found a few too many people who were not honest. Due to people not being honest and taking my customers and my assets and also due to lazy people who sat on the payroll I lost about 400k in a matter of 2 years. Much of this time I was away, traveling while managers said it was all going perfect, but they were the main crooks.

    Finally I took on a partner, he bailed us out financially. Scaled back the business and made it manageable. The damage had been done, and we shut down our retail operations in Nov of 2007. We still try to sell online, but very little comes from that.

    I still think that the idea of systems works, and my goal was always to be able to travel, and leave it to people, but the problem has always been the people. In my years I have employed at least 100 people, some were great and some took me for thousands, I just wish I could know in advance who is who.

    Jason Dragon

  2. Good post, I am now halfway through E-Myth and Gerber discusses the same principles you are talking about. There doesn’t seem to be much point in owning a business if you’re really just owning a job – you may think you have more freedom, but really you are just doing twice the work for the same amount of pay. I think it is funny how to have a successful business you have to “lay down your ego” and know that it can/should be able to run without you.
    Thanks for encouraging me as I look for a small business opportunity to make sure that I actually start a business, and not a job (a chronic problem that my dad’s 3rd generation business can not shake).

  3. @ Jason – that’s the $60 Mill. question: who to trust? Michael Gerber who wrote e-Myth had a partner who nearly sent him broke.

    @ Jeremy – And, you have a lousy boss who ‘rides’ you 24 hours a day! 🙂 Maybe, your opportunity will come outside the family business, or maybe you will get the opportunity to reeingineer the family business (but, be warned, this can be VERY difficult if the ‘old school’ family members are still in there).

  4. Jason, 2 questions in regard to your comment: you said that “most people are NOT money motivated, when they have enough money they stop working”. Can you give more insight on this, the more I realize that the way I think is not how “most people” think, I want/need to learn more about what motivates “most people”.

    Also, looking back on your past experience with your business, knowing what you know now, what would you have done differently?

    Adrian, Thanks for letting me use your blog to process the information that I am learning. I’m not sure I have the fortitude to make $7M in 7 years, but I’d like to have $1M by 30.

  5. @ Jeremy – interesting questions for Jason … if he doesn’t reply here, you might be able to catch him at his own blog:

    I guess Jason’s comment is true for me … but, I stopped working to free up to time do, well, pretty mucb what I’m doing now with this blog.

    Do you know exactly why you need $1 Mill. by 30?

    Helping my 7 Millionaires … In Training! understand their how “much / when / why goal” on my sister-site is the first step on their journey to early financial freedom … even if you’re not in the Final 15 you can follow along!

  6. I’ve always believed (in a working employee way) that you should never be indispensable – if you can’t be fired, you can’t be promoted!

    This post goes well to reinforcing this as I look into my future where I work for myself (self-employed? perhaps…owning a business? ideal)

    Thanks for adding the next step of definitions – setting up the systems that work.

    Jason, thanks for adding that there is a critical risk when we think that others will think like us. I’ve also had that blindspot to others in my life, and had not considered it to be a problem at work, yet I am working around a unique set of individuals today – pretty much we’re all eccentric – and it’s easy to forget that there’s a whole other group that does not think like we do as regards work ethics.

  7. @ Di – thinking no differently to the masses produces indifferent results. Viva la differance!

  8. Ok AJC, you’ve convinced me. I’m going to follow along. I’ve set up a NwIQ account. One thing, I can’t seem to find a link anywhere on your site for other people’s NwIQ, are you going to make that available?

  9. @ Jeremy – “how to see a plan disguised as a series of random posts” 😉 Actually, NWiQ will be an integral – and shared – part of the journey for the 7 Millionaires … In Training! maybe also the final 15 (to be announce live tonight )

  10. Jeremy, good questions.

    First when I mean money motivated, I mean people that want to earn big money. Most people are fear motivated, they have the fear of not paying the bills, and not having food, and not having a safe place to live BUT once those fears are gone (Once they earn enough money so that they don’t have to worry) very few people that I know will continue to do what it takes to make higher levels of income. This is why 80%+ of people have crappy jobs and are not really striving to do better.

    You second question was, what would I do different. Well FIRST off I would have got out of the computer industry back in 2003 or so when it became super price competitive, and there was no margin or market. I also would not have borrowed the 300k+ that I did to keep my company alive, I would have just let it die and go start something else. But if I had to keep the company I would have had more time mentoring the employees. I would have spent more time figuring out who was good and who was bad and got rid of the bad people. I would have been much quicker to fire people, and slower to hire them.

    I also would have spent a lot less money on print advertising and spent a lot more money paying people to make phone calls and go door to door. Our return for that was at least 20 times higher than any print ad we ever did.

    Jason Dragon

  11. wow … excellent article. 🙂 I never really realized until you pointed it out. But now I find myself needing some employees and systems. O.o E-Myth you say? Gotta get it. Thanks~


  12. Pingback: Are you money motivated? « The Business Blog @ Capital Active

  13. Jason, thanks for the insight. I am learning a lot from all of you guys. I can definately see what you mean about people being fear motivated just by looking at those around me here in my cubicle.

  14. Pingback: Want the power to grow your company. Here it is! « The Business Blog @ Capital Active

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