Don’t Let The Systems Confuse You

Don’t Let the Systems Confuse You

By Michael Gerber

For years now, I’ve been “The E-Myth Guy” and inevitably, when I’m introduced, somebody says, “You’re the guy that says you have to make all the systems in your business.”

It’s true, over forty years of teaching small businesses how to become bigger businesses, all of my research has reinforced the theory that a company without systems is a company that can never scale and will nearly always be a small company with an overworked owner at the helm.

But, realistically, what am I talking about when I say “Systems?”

I don’t always mean training manuals and flowcharts. They are, of course, a part of it, but there are actually three types of systems that a business needs to successfully grow and mature.


  • Hard Systems,
  • Soft Systems, and
  • Information Systems.

A Hard System is an inanimate, unliving thing: the color on the office walls, a computer, the various machines and fixtures necessary to conduct the business that you’re in.

Soft Systems are a little more flexible – the people that work for you, your branding, even parts of the training systems that you use for hiring.

Lastly, there are the systems most people think of when I say “systems” – Information Systems.

These are the pieces of the puzzle that provide you with information about the other two systems – cashflow reporting, forecasting, inventory control, and the like.

Without a doubt, Information Systems are the hardest to create and work out, but think for a moment how easily Hard Systems can make life easier for you if you simply spend the time to do that…

Using our McDonalds as an example, we know that, traditionally, their French fries have always been a quality item. As a restaurant owner, you could craft a series of Soft Systems – training manuals – to interface with other Soft Systems – employees – about how to cook the perfect French Fry. Page after page about preparation, timing, grease temperature, hold time, seasoning, and portioning.

Or you could integrate Hard Systems into your company to dramatically cut down on that element. Buying pre-cut and blanched french fries, a reach-in freezer to hold the fries, a fryer that held enough grease in it at the proper temperature to cook the fries properly, and a fryer that automatically raised the French fries out of the grease at a certain time. A salt shaker specially designed to only dispense the correct amount of salt for each basket of fries. Another timer to make sure that any french fries that were “old” were discarded.

All Hard Systems that reinforce what is now a noticeably shorter Soft System (training manual) that interfaces with other Soft Systems (your employees). Essentially, your Soft System describing how to prepare french fries could be shortened from a chapter to a page.

More importantly, you, as the owner, have the luxury of being able to set up all those Hard Systems when you build your business! You’ve got to buy them anyway, but the ones that reinforce what the result is about – a perfectly cooked and seasoned french fry – can dramatically cut down on Systems that you’ll have to create and document as your company grows.

So yes, I’m a “systems” guy, but NOWHERE, in all my writing, did I ever say that you had to make this harder.

Be creative, let out your Dreamer, and think about how you can use Hard Systems to replace a lack of systems in your business.

Michael Gerber
Inc. Magazine calls him “the World’s #1 Small Business Guru” — the entrepreneurial and small business thought leader who has impacted the lives of millions of small business owners and hundreds of thousands of companies worldwide for over 40 years.

Michael E. Gerber is the author of the NY Times mega-bestseller, for two consecutive decades, "The E-Myth Revisited" and nine other worldwide best-selling E-Myth books concerning small business entrepreneurship, leadership, and management.


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