A perfect size 05-08-2011

From the 1980s there has been an increasing level of business globalisation.  That has meant when setting up in business that there is likely to be a giant company ready to supply your requirements, compete against you when you sell and also to buy. 

These big companies are hard to manage, carry a large overhead cost and inevitably make some dumb decisions - and yet they succeed.  I think they succeed because they have enough scale to manage a few dumb decisions, they use expensive people who bring value, they have the ability to establish strong procurement capability and they have good brands. 

The internet is reducing their advantage. 

• Sitting behind your desk in Tahuna it is possible to find almost anything from all over the world.  And it is possible to create a real market to buy from.  That means the market place is less biased to a global business;
• Using the internet allows more cost effective use of smart people. Note my emphasis on cost effective not cheap.  The internet allows quicker communication, common access to information and standard information platforms.  All these things mean less time traveling, explaining, clarifying and waiting.  Instead there can be better information available to focus on getting great advice.  So the advisor can support more organisations
  

Given the implications of the changes I have outlined it is hard to imagine that the march of the giants will continue without a number of changes arising along the way.   Those changes, or lack of changes, will create opportunities for the medium size business if they are smart.