Size Matters! by Kevin McManus
First published in Industrial Engineer magazine December 2001
For the first fifteen years of my work career, I did not appreciate the influence that size has on organizational effectiveness. While I had begun my career with a relatively small family owned corporation, I was fresh out of school and working hard to simply be a competent industrial engineer. Over the next thirteen years, I would also work for two Fortune 500 companies and an international conglomerate. It was not until I returned to a much smaller, privately held company that I really began to realize just how much size does matter.
As Emeril would say, I have now taken the experiment up another notch. In the few short months that I have been with my current employer, I have only become more impressed with the effect that size has on effectiveness in general, making a dramatic culture change, and getting greater results faster. I have noticed that there is a significant difference between an 80 person company and a 500 person one, let alone a major corporation that employs thousands.
Changes that once seemed impossible are now much less challenging to implement. Effectively communicating a vision is much easier to do. Detailed performance analysis can be accomplished with a laptop and a spreadsheet package. Motivating and recognizing each team member can be done on a daily basis, and in a very meaningful way. People issues do not consume the majority of my workday.
I would not work for a large company again. That said, some of you might wonder what my definition of ‘large' is, and others might question my logic. That is a pretty bold statement to make after all. Why would I have such an opinion? The answer is simple. In terms of helping a company develop into the kind of place that I want to spend a majority of my waking hours in, you cannot beat the potential for rapid and comprehensive change that seems to increase exponentially with a decrease in organizational size.
Over the years, I have seen the actions (or inaction) and beliefs of only a few hold back an entire company. There is a lot of truth to the corporate adage that you cannot achieve significant change unless those at the top both change and have a consistent vision about where they want to go. At the same time, we always have the potential for developing a pocket of excellence within our own workgroup, even if others choose to remain on the burning platform of complacency. In small companies however, one or two pockets of excellence can have a major impact on influencing other groups to follow their lead. Those at the top may have to change, but they do not always have to be the first to change.
Some would argue that technology has helped larger companies communicate with more people at a lower cost. While I strongly feel that technology helps organizations communicate much better in general, you cannot replace the power of human touch when you are trying to motivate people, create a shared vision, or teach managers to be better coaches. Like it or not, people get their primary image of what the company is trying to accomplish from the manager they interact with the most, not the e-mailed mission statement with a hyperlink to the company's marketing-focused website.
When a company is smaller, you can ‘touch', and in turn influence, more people each day. Relationship quality is more important. Resources are better utilized, because people have had to learn to be successful without the fancy computers, analysis software, and videoconferencing equipment that larger companies can afford. In fact, I have seen small companies be very successful even though they did not use tools like budgets, performance appraisals, or fancy training packages. The question is one of influence. Which is more powerful – effective human interaction or an impressive looking training center?
It is my belief that front line supervisors and managers are the key to fast, high-powered change. In a large company, you can rarely even see what these people are doing, let alone effectively assess and help them improve their performance. In a small company, the distance between the top and the bottom of the organization is minimal, and you can much more easily see where you leadership barriers are. A simple ten minute walk through the facility allows you to interact with essentially every team member, and in a human, meaningful way.
The purpose of this article is not to encourage a mass exodus to smaller companies. I do not have to contribute to that effort, as it is well underway already. Instead, I wrote this with the intent of helping people begin to discuss what really matters at work each day. Many of us have been blinded by the flash of technology and the glitz of ‘being the biggest'. We have forgotten that people are what make the difference, and that those people we spend the most time with each day are the ones that we can influence, and be influenced by, the most.
Think about what really sends a powerful message. The power of the annual ‘all employee' meeting, complete with a professionally prepared video, plenty of recognition giveaways, and lots of verbal kudos, pales in comparison to the daily visions, values, and desires that we communicate to people each day through our actions. Sixty minutes of contact a year cannot offset the effect of sixty minutes of contact (or more) each day. Who (or what) is influencing the greatest percentage of your people on a daily basis?
In closing, I would like you to think about the current surge of lean programs that are being kicked off, pushed, and practiced in organizations around the world. Can we expect a smaller organization to have relatively more success in becoming truly lean (and not just on the front lines)? What is the probability that larger companies will be able to make lean practices stick at all? How much does size matter?
It would be easy to say that large companies are doomed, but I am not that fatalistic. The key lies in getting a lot of ‘pockets of excellence' in motion – you have to spread the word from the inside out. Remember, it is likely that the front line supervisors and managers are the gatekeepers to change in your company too. Even if your organization is large, you can still find ways to build relationships, interact in a personal way, and make change happen within your own circle of influence. Size does matter, but it does not represent a barrier to change that cannot be overcome.
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