It’s popularity peaked a few years back, but the E-Myth series is popping up in my circles again. In the E-Myth books, Michael Gerber argues that new businesses fail because people who are good at a thing–painting, writing, plumbing, whatever–start a business and figure they can be successful because they’re good at the thing they do. He says these folks need to be good at business if they want to succeed. I won’t dispute that point, but he goes on to argue (and I’m going to over-simplify here) the way to do that is to set up processes and systematized workflows to run the business in such a way that the entrepreneur is freed of responsibility for daily operations.

Which I guess makes sense if you’re running a factory.

Process is Good…

I’m not contra-process. I’m a process guy. Dismantling and rebuilding a proposed policy or process so I can create an exhaustively thorough and detailed flowchart is something I often bemoan having a natural affinity and mental compulsion for doing. Processes make a lot of things easier, but like love, processes cuts both ways.

…But Not Great

If you want to experience first hand why this matters, go to your local downtown and find a locally owned, non-franchise business. Spend 30 minutes asking paying customers why they chose the small business over the chain stores.

They sure as hell won’t say process.

They’ll probably say something like customer service, small town feel, or unique offerings. You know, the things small businesses can do that most big companies can’t.

Processes Work…

Now perform the same experiment at McDonalds and you’ll get process-centric answers: convenience, low cost, speed. You know, the things that make big companies big.

…But Will They Work For You?

If your business is built of processes, you can hire unskilled workers, pay lower wages, have more control and get reliable, measurable output. But you’ll be hiring robots, not people.

If you want people capable of using their judgement, creativity and innovative thinking, then you need to work on your culture and values. Scrap the processes.

1. How did you choose your location?
2. How do you set your pricing?
3. What is your marketing strategy?
4. How do you set staffing levels?
5. How do you set your compensation packages?
6. How are you different from your competition?
7. How did you settle on your technology infrastructure?

Here is one question very few businesses can answer:

1. How does your corporate culture contribute to your profitability?

Actually, that was a little disingenuous. A good many businesses can answer that question, but the answer is “It doesn’t.” Not because culture and profitability are unrelated, but because their relationship has been given no thought.

If you could make employees more productive by removing workplace conflict and confusion about expectations, would you do it? If your employees looked forward to Monday morning, would they hit the ground running and work harder? If employees enjoyed their jobs, would customer service improve? If your employees were excited about your direction as a company, would your customers notice?

If you employ human beings, then your corporate culture is important. It’s also hard. Harder than any of the items on the list above because people are much more complicated than a technology infrastructure. But if you don’t leave your location, pricing, or marketing to chance, why would you leave your culture to chance?