Why Bigger Isn’t Always
Better, Part II.
Q: I am seriously thinking about
starting my own business, but I’ve always worked for large
companies. I liked what I read in your last column about going from
large to small, but I can use some more convincing. Do you have any
other good reasons for starting or working for a small firm?
A: Why, of course. Here are
some added myth busters to strengthen your resolve:
Myth: Small businesses offer fewer
opportunities for advancement.
Dwight B., a former submarine officer
and graduate from MIT, has always wanted a career in manufacturing.
After interning at GM, he decided a smaller organization would give
him more opportunity to impact its direction. Having fulfilled his
commitment to the Navy and completed his MBA, he started with a
small manufacturing company supervising an area of plant operations.
In less than 10 years, he has moved up to COO at a second US-based
At family-owned or stagnant small
companies, this myth may be true. However, fast-growing small
businesses must continually add employees and managers to keep pace
with demand for their products and services. Employees in these
organizations wear many hats simultaneously, so on-the-job training,
continual learning and increasing responsibility are required.
Myth: Large companies are unlikely
to do business with small firms.
Downsizing and reorganizations at
large companies have created opportunities for small firms to
provide services that were once performed in-house. (How many
professionals do you know who have returned to former employers as
independent contractors after being laid off?)
Big companies are more interested in
working with smaller organizations because they often receive higher
quality service for a reasonable price from seasoned experts. Many
larger firms and government agencies also must meet internal
affirmative action goals that require them to contract with minority
or women-owned firms. This creates even more opportunities for small
Myth: Small companies use the same
hiring criteria as large organizations.
Most large corporations rely on
education and experience requirements to screen new hires or promote
existing employees. This perpetuates the practice of putting "square
pegs into square holes."
But small-company managers tend to be
more open to candidates with different backgrounds. While they may
seek certain experience, they consider enthusiasm and aptitude when
making hiring decisions. Entrepreneurs tend to trust their own
instincts and are more willing to bring career changers or less
educated professionals on board who demonstrate an ability to do the
Myth: You can't make a big
contribution at a small company.
Jim L. is impressed by the authority
he has to upgrade RSP's tooling department. As the company adds
plants, he's responsible for ensuring their tool-and-die design
meets quality, cost and efficiency standards. It would have taken
years of employment and a bigger title to make a similar impact at
his previous company.
Myth: Smaller companies don't act
on opportunities the way a large firm can.
Ross Perot, a business legend and
former presidential candidate, grew EDS into a very lucrative
business process and data management firm. When GM began to realize
that its way of getting things done needed tremendous improvement,
it acquired EDS. After a couple of years, a frustrated Perot said,
"If someone at EDS sees a rattler, he kills it. If a GM manager
comes across one, he puts together a committee to discuss the
situation." That marriage didn’t last very long.
Small businesses tend to be more
creative, nimble and aggressive in pursuing opportunities. Fewer
management barriers exist, and less voices are likely to chant "If
it ain't broke, don't fix it." Entrepreneurs don't have the luxury
or comfort of being king of the jungle. As a motivational plaque
says, "When a gazelle wakes up in the morning, he has two choices:
He can either run like hell or be eaten." Small businesses have a
lot in common with gazelles.