What Big Business Can Learn from Small Business

Doing More with Less

If there’s one thing most small businesses do really well, it’s doing more with less. Most small businesses have a lot less capital and resources at their disposal, so they have to get creative.

Big businesses are used to solving problems with money, so often, ingenuity and economy fall by the wayside, replaced by expediency. Spending a little time re-learning how to cut costs whilst increasing growth could help big businesses to save money and make more profits.

Choosing Innovative Solutions

When businesses are small, they are often forced to find better, faster, innovative ways to do just about everything. Whether it’s embracing high tech software solutions or developing entirely new processes to manufacture items or provide services, those innovations have the power to change not only their company, but whole industries.

Big business, on the other hand, tends to be a lot more set in its ways. Things are done the way they are because they have always been done that way. It also takes a much longer time to implement and roll out innovative changes in larger organisations.

Big business could benefit from learning from the innovative nature of small business and find ways to make change faster and easier to implement.

Customer Focus

Small businesses usually have no choice but to be customer-focused. As they are most often the newer market entrants, providing different or new value is important. Big business may sometimes forego value-added by customer service, for example, in order to service a greater number of people. This is rarely overlooked by small business, and many pride themselves on their faster response times and more personal touch.

Not only does this help to ensure repeat business, but it also means you’re more likely to get referrals from happy customers. No matter what people will tell you about big marketing budgets and clever advertising, there’s nothing quite like word of mouth when you’re trying to grow a business!

Big businesses tend to lose sight of the customer and their critical role in the success of any business. They might have lots of customers and think it’s not important, but things can change quickly, and learning to put customer wants and needs at the top of the list is an important step in cementing and protecting long term success.

Embracing Opportunity

Usually, when small businesses are focused on growth and expansion, they look everywhere for opportunities. Even if it’s not part of their primary focus, when a promising opportunity comes up, they’re far more likely to take the chance.

Big businesses tend to be more prescriptive about the kinds of projects they will take on. They tend to want to “stay in their lane” more than experiment a little. While this can work if you are the best in your industry, it could also lead you down the wrong path.

One example would be the Thomas Cook Group, which had been a leader in the tourism industry since it was founded in 1841. That long history did not matter though, when a failure to embrace new technology led to the closure of the company in 2019.

While companies need to balance capacity with the need to explore new possibilities, it’s important to remember that evolution is key to survival. Small businesses tend to evolve constantly and learning to be a little more flexible and open to change can increase the longevity of large businesses too.

Empowering People

Small businesses generally have small teams. Owners and managers might have a few people working below them, however, while there are some that might have a hundred or more people, most teams are small.

This allows for a much more personal relationship between leadership and employees. It also allows leaders to identify talent and support employee growth. This often leads to increased productivity, better employee retention and happier employees.

Large businesses, on the other hand, may tend to see people less as individuals and more as numbers on a spreadsheet. While it can be hard to adapt the smaller, family like feel of small teams in big business, there are ways to increase personal connections. They may feel that they have leverage from their size, brand awareness, and status, and use that as an incentive in itself to quickly fill positions that have become vacant. However, seeing employees as disposable will lead to low employee happiness and motivation. A high turnover rate may also result in stagnated continuation of projects and operations, directly impacting the bottom line.

Focusing on building teams that are close knit and supportive, implementing programs to support employee training and development and more are all ways to empower people. You might think that losing an employee is not as bad for big business, but all the research says otherwise. Not only is replacing employees expensive, but high turnover can also be detrimental to growth and profit.

Aggressive Growth Strategies

Small businesses, by nature, are hungry. If they hope to achieve the growth they need, they must have aggressive strategies to acquire customers. They often spend more on sales and marketing, and they tend to be more proactive about finding new business.

Big companies, however, who have extensive and established customer bases, tend to take the approach that business will find them. Some even rely on a handful of anchor customers for much of their revenue. However, if one of those customers were to disappear, the effects could be devastating.

Large businesses could benefit from learning how small businesses approach growth and marketing. Being a little more aggressive about these strategies could give them the cushion they need to ensure long term, continued success.

Thinking Small Doesn’t Mean Being Small

As you can see, there are several lessons small business could offer large business. Small businesses are generally nimbler, adapt more easily to change and are always looking for ways to improve. When you combine that with the resources and capacity large businesses have, the result is almost always positive.

So, while it might not always be feasible to operate like a small business when you’re not, always consider what you might have done if you were still the little guy. Then see how you can build that into your business.

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To learn more, discover the power that small businesses wield by reading this article on how small businesses can greatly impact large businesses and how you can use that influence to your advantage!