Bigger Is Not Always Better: 5 Ways Organizations Can Utilize Their Smallness as a Strength

I grew up in a part of Southeastern Pennsylvania that came to life in the early 1950s. U.S. Steel, Rohm and Haas, 3M, and General Motors were some of the industries that led to the building of thousands of homes in the towns of Bristol and Levittown for the employees needed to operate these plants.

Two miles from the home where I grew up, there is a little house that was converted into a hardware store called Beach’s Hardware. William and Florence Beach opened the store in 1950 to serve the new homeowners and businesses that had recently emerged. In that little store, you can get paint, fix a window screen or glass, buy a bolt, get a key made, buy a light bulb and extension cord, or purchase a new plumbing fixture. In what feels like an optical illusion, they have just about everything you could imagine in a space no bigger than the first floor of a small starter home.

Guess what happened in the early 1980s when Home Depot and Lowe’s showed up 10 minutes away? Nothing. Beach’s Hardware is still there today, fully operational, and now in the third generation of family ownership. Just like the biblical character David was able to contend with the giant Goliath, so too was Beach’s able to contend with the big box stores and continue thriving. Beach’s Hardware is just one example that bigger is not always better. Here are five ways small organizations can utilize their smallness as an advantage.

1. Values Driven

In his book, Small Giants, Bo Burlingham shares his research about highly successful businesses that intentionally chose to remain small and yet were high-performing in their industry. The owners were focused on values that were greater than just profits, and this fueled their decisions. Make no mistake, they were highly profitable, but the owners had other values that were also important to them, including keeping the business at a size and scale they felt best aligned with family values or quality of life.

One of my clients decided to sell one of the locations of her business because it was difficult to staff it due to the distance. Everyone told her not to do it. “Never get smaller!” they said. But she knew better and sold it. Her business never missed a beat, and its profitability actually increased! Those who remain successfully smaller have a very clear sense of mission and well-defined values that guide their decisions.

2. Customer-Centered

My neighbor does custom kitchens and baths. It is a very small operation with just him and one helper. And yet he is consistently booked 4-6 months out for work. Why? Because not only does he have great expertise, but he also only does one job at a time. When he did a major renovation in our kitchen, rather than tearing our home apart for eight weeks, he was in and out in 7 days! And, it was done with excellence. If there was a test for patience, I would consistently get an “F,” so having a brand new kitchen completed in 7 days was a perfect fit for me and my family. Too often, the larger an organization becomes, the less personalized it is. And this is true in businesses, nonprofits, and churches. Small enterprises have their own inherent challenges, but they can often win against the Goliaths that surround them by their customer-centered focus.

3. Expertise

One of our clients at The Center Consulting Group owns a landscape and hardscape business. As a former landscaper, I strive to have my home look like the grounds of Disney World (without the mouse-shaped plant). I was having trouble with my lawn, and the owner of this business stopped over to take a look. His wealth of knowledge was exceptional, and he was willing to see my lawn in person. There are similar companies that do good work, but some would not have had the expertise needed to accurately diagnose my problem and provide a solution. This owner was able to help me because his business is sized so that he can still have contact with his customers.

4. Personal Connection

I confess that I love Home Depot (no offense, Lowe’s). My family says I go there even when I don’t need anything, which may be a bit too true. But while I love the size and scope of such a big store, I do not have any personal connection with the manager or employees. (Except one woman who works in the paint department – she is exceptional at her job!). In a place like Beach’s Hardware, you do not have to walk half a mile to find someone to answer a question. The owner and his staff are right there, and they know just about everything related to parts, repairs, and hardware. Years ago, when my dad would go there, they knew him by name. That is the power of personal connection, and it grows increasingly more difficult the bigger you get.

5. Ability to Adapt

Circuit City was once the largest consumer electronics store in the country. However, with 567 physical stores and 34,000 employees, it did not adapt fast enough to the changing consumer shopping patterns. Circuit City was overtaken by Best Buy, which at that time was a fraction of its size. Sometimes, large organizations can become weighed down with complexity, bureaucracy, and complacency. While small organizations can also get caught in these death cycles, they have the advantage of being able to move faster and be more flexible. For example, when Beach’s Hardware needs to change a product line or display, it takes minimal money and minimal time. When a big box store needs to change, it can cost millions of dollars (something stockholders may not favor) and require extensive time and effort, making it more difficult to accomplish.

Whether it is being customer-centered or having the ability to adapt to fast-paced changes, the small size of your organization can be a strength. To learn how to best utilize those strengths, contact us to speak to one of our experienced consultants.

Jay Desko is the President & CEO of The Center Consulting Group and brings experience in the areas of organizational assessment, leadership coaching, decision-making, and strategic questioning. Jay’s degrees include an M.Ed. in Instructional Systems Design from Pennsylvania State University and a Ph.D. in Organizational Behavior and Leadership from The Union Institute.