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Sunday, September 21, 2008
Chapter 1 - Mediocrity as the first enemy (draft)
When thinking in the nature of small business I find two kind of organizations. The first kind starts with one customer and a good contract that will cover their expenses, desired salary and provide security. The second kind starts with one customer or less, but have a vision of growing in number of customers.
When asking the first kind of small businesses about their interest in "growing" they normally answer me: "I don't need to grow, as it is I have enough work to do and I have a life to enjoy". And the fact is that in many cases they also have enough money. In most of the cases I know, that kind of small businesses are sole proprietorship companies with small number or none employees.
The second kind of small businesses are in many cases at higher risk. Normally their first customers are not covering their expenses, but are very motivating. That motivation makes them very active, adaptable and creative. The fuel of this kind of company is "the hope" each new customer provides. In order to catch new opportunities the company needs to improve constantly and adapt to what the market requests. Many of them will be offering services or products very different than at the beginning. If this kind of organization knows to read the market messages and learns to communicate effectively, they will probably get an important business between hands. If not, the risk and expenses could finish killing the small organization. When asking them about growth their answer is normally like: "Of course we need to grow, tell me how to get more and more customers".
I would not like to say that one of the cases is better than the other. Actually all depends on personalities, personal goals, ways of life. So it is important to say that each case is valid and worth.
For both cases, mediocrity is a huge problem. That means the lack of an organizational culture for the constant development of high quality products, services and working conditions.
From the other side there is an important concept we should not forget: the social role of establishing a business. That means that businesses exist for generating value, improving quality of life and driving progress. Can a small business focused on the wealth of its owner fulfill its social role? Can a company employ many people without a clear plan that would help to fulfill the responsibility of providing adequate work conditions and salaries?
Then the important things are understanding the weaknesses in the kind of business we run, plus finding how is the social role affecting the business environment. Getting this information can help companies to get far from mediocrity, therefore getting closer to a respectable business practice.
When asking the first kind of small businesses about their interest in "growing" they normally answer me: "I don't need to grow, as it is I have enough work to do and I have a life to enjoy". And the fact is that in many cases they also have enough money. In most of the cases I know, that kind of small businesses are sole proprietorship companies with small number or none employees.
The second kind of small businesses are in many cases at higher risk. Normally their first customers are not covering their expenses, but are very motivating. That motivation makes them very active, adaptable and creative. The fuel of this kind of company is "the hope" each new customer provides. In order to catch new opportunities the company needs to improve constantly and adapt to what the market requests. Many of them will be offering services or products very different than at the beginning. If this kind of organization knows to read the market messages and learns to communicate effectively, they will probably get an important business between hands. If not, the risk and expenses could finish killing the small organization. When asking them about growth their answer is normally like: "Of course we need to grow, tell me how to get more and more customers".
I would not like to say that one of the cases is better than the other. Actually all depends on personalities, personal goals, ways of life. So it is important to say that each case is valid and worth.
For both cases, mediocrity is a huge problem. That means the lack of an organizational culture for the constant development of high quality products, services and working conditions.
From the other side there is an important concept we should not forget: the social role of establishing a business. That means that businesses exist for generating value, improving quality of life and driving progress. Can a small business focused on the wealth of its owner fulfill its social role? Can a company employ many people without a clear plan that would help to fulfill the responsibility of providing adequate work conditions and salaries?
Then the important things are understanding the weaknesses in the kind of business we run, plus finding how is the social role affecting the business environment. Getting this information can help companies to get far from mediocrity, therefore getting closer to a respectable business practice.
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