Oh boy, this is going to be trouble. But since my readership is small, they’ll never know my tiny blog weighed in on such a “heavy” subject. Such is the subject of the virtues of small companies. I’m referencing the prevailing theme at 37Signals, a gracefully written counter-account from Mena at Six Apart, and a counterpoint posting by 37Signals.
37Signals is a small company and gets maximum value out of their few employees. They have several successful products and do consultancy work. From their company came Ruby on Rails and that framework is flourishing in the Open Source community.
I don’t know much about Six Apart other than what I read today and the fact that this weblog is hosted by them. The latter factor doesn’t bias me in the least. They are apparently a funded company that has grown from few to many. And like 37Signals, they are enjoying some success. I do not know the specifics of either company’s financials, I am just going on buzz and intuition.
The sparring today seemed to be based upon big companies versus small companies. But let’s face it, Six Apart only has 80 people and that’s hardly a big company. To some degree, they are unadmitted peers and I think they are in violent agreement.
The argument being made for small companies is that you can achieve as much with a small company as you can with a big company, so there’s a certain prideful feeling about remaining small and achieving perceived big things. I hesitate to say this, but I think pride and ego play a part in this tournament. And I feel its mostly from one side.
Big companies can achieve big things. Their size enables them to scale and bring much to bear on the problems that they solve. Let’s face it, if you are a small company, your potential is bound to be limited. You just cannot be Amazon with a team of five. That’s not a knock on 37Signals, its a matter of math or physics.
Achieving big things is a matter of execution. With a team of five, there are fewer connections in their network to support, so naturally communication is more apt to be efficient. Many big businesses go astray because they cannot scale their production along with their size. In my opinion, this is an organizational issue. You can structure your organization so that it efficiently handles the communications required across your vast number of employees. However, not every node will or should be connected. The goal should be to conscientiously keep the connections that matter efficient. Accountability and empowerment should be preserved in this structure. What I’m trying to say is that you can be big, think big, and act small at the same time. To me, the size of your company has less to do with what you can achieve than your ability to organize, communicate, and execute. Small teams can be dysfunctional too.
Personally, I like being a part of a small company. However, being a part of a well-run big company is okay too. Either has a chance to be successful. In my opinion, the small company can evolve to a big company and still preserve its small company culture. Growing in size is sometimes necessary to increase the potential for bigger things.
And as I’ve said before, just my opinion, I could be wrong…
I’m in Napa Valley at a PR industry conference and just attended an interesting presentation by Jason Jennings, author of “Think Big. Act Small.”
Jenning’s book examines the traits of those companies that have produced 10 percent increases in growth and profits every year for the past decade. Incredibly, fewer than 20 companies can lay claim to such an accomplishment.
Those that can share similar traits (i.e. casusal dress codes, a CEO who gets his/her hands dirty by staying close to the customer and pursuing a long-term cause as opposed to short-term quarterly earnings). They also share one other trait: none of the great companies had a mission statement.
That finding really hit home with me. I’ve always thought mission statements were totally bogus and were nothing more than warm and fuzzy statements with lots of feel good words. Just because an organization says it does something doesn’t make it so. Rather, it’s the actions of an organization that define its success, its points of differentiation and ultimately, its brand and reputation.
The best mission statement in the world will fall flat if its products, people and performance are mediocre or less. I once worked for a $500 million integrated marketing agency whose mission statement was “we build brands over time and sales over night.” I remember the snickering when the CEO read it out loud to us and had it posted along all the hallways. It was purely aspirational, had no basis in reality and, in point of fact, actually alienated clients, prospects and employees. The company went out of business about five years ago.
Not that we’re remotely close to the organizations profiled in Jennings’ book, but you won’t see any mission statements in our hallways. That’s because we believe actions speak louder than words. Especially the words of mission statements.
Guy Kawasaki agrees with you. In his book, Art of the Start, he recommends coming up with a simple mantra, preferably three words or less, that succinctly describes your core values. Some examples he gave:
Wendy’s: “Healthy fast food”
FedEx: “Peace of mind”
Nike: “Authentic athletic performance”
Guy Kawasaki: “Empower entrepreneurs”
And with those few words, you then live it and make it happen.