SMEs vs MNCs and change

A large oil tanker requires up to 3-4 km′s of breaking space prior to being able to come to a full stop. Small fishing boats can stop rather much faster.

Similar as with the breaking distance, a large oil tanker takes some time to turn around, whereas small fishing boats can do so much faster.

Large MNC′s / organisations require much more time to turn around compared with SME′s. Sometimes too much time, see the case of GE and Flannery:

Smaller organisations can change course much faster.

What is the consequence of this for CEO′s in charge of this change? When you are the person at the wheel in a small fishing boat, you tend to need to be much more hands-on. Remove yourself from the equation and the chances are that you get blindsided by a wave you didn′t see. Once hit, you′re done, as typically banks aren′t very forgiving with SMEs (despite central banks′ efforts in offering more support).

Large oil tankers can take quite a big wave, and as such, require less hands-on involvement of a CEO, who instead of being the man at the wheel, is required to think more long term, see which routes offer the best marginal savings.

I work with many people who used to work at an executive level and then started their own business or moved to a smaller organisation to escape "corporate life". Yet, what I see over and over again is a failure to understand that in SMEs, if you want something to get done, you typically need to get personally involved or simply get it done yourself, as there simply aren′t enough resources to “just get it done”. The available budgets are man-hours, not euros.

Likewise, a similar challenge exists on the SME side, when they grow into a larger organisation. Consequently, as a CEO you will typically need to become less hands-on involved, delegating more and more all the time and trusting more on others to get the job done, freeing up your own mental time to look at the bigger picture.

Whatever your role is as a CEO, leading a large organisation or an SME, make sure that you understand the implications of your own behaviour in whatever context it is you operate in.

Happy sailing!