This past week, I attended the U.S. Chamber of Commerce’s America’s Small Business Summit, where companies from all over the country — ranging from loggers to dry cleaners to chocolate makers — attended to share lessons learned from experience. Small businesses have a real advantage over larger companies today, but some owners fail to recognize and pursue these advantages. Large companies are trying to shift their cultures and processes toward this small business mindset.
So, what are these advantages? Here are three that small businesses have:
•Agility. Small businesses rely on their people and their ability to work together daily. The great thing about being small is that you know everyone — their personalities, their families, their personal goals. This enables them to know who to call upon when a crisis occurs, who to help build the new product or service and to change quickly when the market demands it. Larger companies formalize processes and procedures — which they often must do to scale their operation — but in doing so, these processes create “baggage,” where the process or form often takes precedence over “getting it done.” This means larger companies cannot change as quickly, and sometimes leads to failure to support the market changes.
•Adaptability. Small businesses take risks — risks that may lead to failure. But often, these risks will lead to innovation. And that innovation drives changes in the market.
In today’s economy, the only certainty is this: things will change. Small businesses must adapt to their consumer needs, and that adaptation is what enables some of them to grow in scale — creating a “survival of the fittest” economy.
This is the fuel of capitalism. Most large companies have research and development departments, but these companies often are slow to see and embrace change, seeking to stick by their current plan amid a sea change. There are a lot of changes occurring today in our workforce — fundamentally new approaches to lead and leverage our workers — yet, many companies resist adapting to these changes and are seeing younger workers leaving.
•Walking the Talk. Most importantly, a small business has the advantage of knowing what it stands for, and ensuring that those values are shared with its customers and staff every day. This advantage exists mainly due to their size and the “flatness” of their organization (there may be only one or two levels in the hierarchy).