Ready to learn about the difference between an S-type business and a B-type business?
Robert Kiyosaki explains that the biggest difference between a Self-Employed (S) person and a Business Owner (B) is not how hard they work, but what they own.
A true B (Business Owner) can leave the business for months or even years and return to find that the business is still running successfully and may even be more profitable. This is because a B owns a business system and has trained capable people to manage it.
An S (Self-Employed) person, however, often owns a job rather than a business. In many cases, the person themselves is the system. For example, a dentist may be highly skilled and able to handle everything alone, but if the dentist takes a long vacation, the income usually stops because the business depends on the dentist’s personal work.
According to Kiyosaki, becoming a successful business owner requires two major skills:
• Owning or controlling a strong business system.
• Leading and managing people who operate that system.
For a self-employed person to become a business owner, they must transform their knowledge and skills into a system that others can follow. Many people struggle with this because they are too attached to doing everything themselves.
Kiyosaki noticed that many aspiring entrepreneurs focus too much on their product or idea. They say things like, “My product is better than everyone else’s,” or “Nobody else has created something like this.” He believes this way of thinking comes from the Employee and Self-Employed side of the CASHFLOW Quadrant because the focus is on the product, not the business system.
To explain the difference, Kiyosaki uses the example of McDonald’s. He asks people whether they can make a better hamburger than McDonald’s, and most people answer yes. However, he then asks whether they can create a better business system than McDonald’s. This is where many realize the real challenge.
The success of McDonald’s does not come from having the best burger. Its strength comes from its powerful system - its suppliers, farmers, transportation networks, employee training, marketing, consistent operations, franchises, and financial structure that allows it to deliver the same experience to millions of customers worldwide.
Kiyosaki argues that the world has countless great products, ideas, and talented people. What is rare is the ability to build a system that can repeatedly deliver those products and services without depending on one person.
He uses Bill Gates as another example, explaining that Gates did not become successful only because of a product. He became extremely successful by building a powerful global business system around technology.
In Kiyosaki’s view, the path from the left side of the CASHFLOW Quadrant (Employee and SelfEmployed) to the right side (Business Owner and Investor) begins when a person stops focusing only on creating a better product and starts learning how to build a system that can work and grow without them.
Stay tuned to learn about the Investor (I) Quadrant!
