With Business, is Bigger really Better?
Aug 25
Everybody wants to take the lead – whether it’s a small organisation or a small member of staff! Most people seem to have the perception that “Bigger is Better”, but recently this perception has changed, and the revolutionary concept of “Small is Big” has arrived on the scene.
As any business coaching expert will tell you, the bigger you become the more profit you’ll earn through a higher overall sales threshold, and the more efficient you get in your operations, the greater status you will eventually achieve. But there is another side to this example – something truly unfortunate, which is that the bigger you become the more overall risk you’ll take on, developing increasingly rigid and unmanageable individual client relations.
Small firms are much more focused in their approach because there is a much greater possibility of innovation and experimentation in their in-house operations. These small firms may not have the ability to use the benefits of “global economics” to their advantage, but they’re certainly open to the exploration of “local economics”. In the current example, small businesses are generally more profitable and growth oriented, as they’ve an amazing potential to realise significant levels of profit and expansion – at astounding levels, which percentage wise, big businesses just can’t achieve.
Small businesses can be much more flexible than big businesses, and they can quickly adapt to just about any changes in the market if the necessity arises, as they’re able to immediately implement strategic decisions. The small businesses which are successful understand what they’re great at – and they do it on a daily basis, effectively and efficiently. They can serve the needs of their customers in an ideal fashion – regularly sharing personal interaction, with the usual result of a growing number of long term relationships. In most instances, small businesses maintain actual direct contact with their staff and individual stakeholders, thereby giving them far more influence over their day-to-day operations, which makes them more able to integrate and coordinate all kinds of planed actions.
Also, with respect to the stock market – when involved with management training, we can clearly see there are numerous occasions where we find that stocks of small companies consistently outperform the stocks of their big business counterparts. Their stocks can often earn high returns for their shareholders and occasionally may even be less risk-prone. During really adverse conditions of the market, there is also far less impact on their share prices compared with the stocks of large corporations. So what do you think, what matters most – thinking big or becoming big?
Alan Gillies is the Managing Director of the L2L Group, specialising in providing Executive Coaching, Training and Consultancy Services to Businesses across the Globe. Want to learn more about these business success strategies? Get Alan’s popular FREE Business Pack today!