It’s not easy being small.
Well, if it’s any consolation - it’s not easy being big either. Or mid-sized.
But small businesses have advantages over big businesses too.
1. You can be agile
Turning around a battleship obviously takes a lot more time and a lot more people than it does to make a 180 degree course change in a speedboat. Military geeks call this the tactical diameter (TD) and in an old school sea battle the maneouverability could be the difference between victory and Davy Jones’ locker for all hands on board.
2. The consequences of errors are smaller
When you are big the stakes are higher. That’s not to say small businesses don’t put everything on the line when they commit. But when you have 100 people working for you, and suppliers, and shareholders - then the consequences of your actions and the choices you make a greater. So you will take longer to evaluate even tactical options and, oftentimes, will opt for the safest option. It used to be said that ‘no-one ever got fired for choosing IBM’. It wasn’t necessarily true that IBM was any better than alternative computing brands - but its brand reputation meant that managers could use it as a default. If the project they had hired IBM to undertake went pear shaped, then they could shrug if off - ‘who knew?'. Conservative decision making can have radical negative consequences. In the 1990s the New Zealand government engaged IBM to introduce a new system to overhaul the Police's computer systems to improve their ability to investigate and analyse crimes. It was a monumental failure - before the plug was pulled on INCIS it cost taxpayers $110 million dollars.
By comparison developing a promotion for your small business may not work as hoped; but, if you play your cards right - it won’t put everything on the line.
3. You aren’t flabby.
This relates to agility but deserves a special mention. Sometimes the speed at which things get done is exactly inverse to the number of people involved in the process. When you have layers of people involved with their own agendas and egos in the mix things get complicated. Complicated things are delicate and break easily - so people in large groups tend to get drawn into groupthink and maintaining social order. Top managers don’t have to worry about protecting their teams and silos of influence and under-managers don’t have to worry about antagonising their bosses. I’m not saying that there aren’t dysfunctional small teams - obviously there are - but in a small team there is less precious energy and resources wasted to simply maintain the operating system - before you even get going on a challenging project.
The elephant in the room, of course, is that big businesses have more resources. More money, more established connections with customers. Waste and inefficiency is often factored in. Think of the Saturn rockets that were designed to carry astronauts to the moon. The very reason they are so big - as tall as a 36 story building. Fully fuelled it weighed 2.8 million kilograms (most of which was need to lift itself off the launch pad and beyond the atmosphere). Lumbering scale has an inevitable energy cost - and waste is often accepted (the boosters and fuel stages of the Saturn rockets were only one-time use). In big organisations individuals may also be more inclined to operate inefficiently - ‘just doing my job’ rather than taking a wider view of their work. This can also filter into interactions with customers. If most workers in large organisation use 70 percent of their possible effort (discretionary effort) then business turning over $50 million might be throwing away $15 million every year, simply as a tax on scale.
JackSpratt™ is a service for small business that not only helps you make the most of your advantages - but also to amplify the resources you do have by helping develop cunning plans and to implement them at little or no cost. Not only will there be short term gains but you will also learn techniques and habits that can stay part of your culture as you grow.
Get in touch if you'd like to know more.
This blog is a notepad of contemporaneous and sometimes extemporaneous thoughts about creativity, strategy and ideas.