Big businesses get a bit of a bad rap in popular culture. Just like governments, they’re seen as a kind of amoral aberration, destroying the planet and doing untold harm to their workers. Views like this come primarily from Marxism and its derivatives.
However, this isn’t the only viewpoint you can take. When you adopt a more pragmatist perspective, you soon see big companies have something to teach us all. After all, how did they manage to grow so large in the first place? Surely they have to be doing something right?
There’s a strange disconnect in the popular narrative of the corporate world. People lavish small businesses with blessings, talking about how we should always support those who work in our local community. However, once they get to a certain size, the narrative flips, and we view them as a kind of moral failure, despite their explicit market success.
The truth is that enterprises that fulfill the imperative to grow and manage to scale have a lot to teach us. They’re not just empty vessels, carrying out the whim of wealthy investors pulling strings out of sight. Instead, they’re massive organizations of people, able to do things that the average small company couldn’t dream of.
Here are some of the lessons we can all learn from big businesses the world over:
Create A Moat
Why do some big businesses get so big in the first place? Usually, it has something to do with creating a moat.
Take Google, for instance. In the late nineties, there were dozens of search engines vying for the internet advertising market. Yahoo, AOL, and AltaVista each had a good shot at becoming the top dog and pushing everyone else into obscurity.
Except, unfortunately, that didn’t happen. Instead, Google – the brainchild of two MIT graduates – came to utterly dominate the world of search in a way practically no company ever managed before.
The company’s success comes down to one simple idea: the creation of a moat. Once Google collected data on its users and built a search engine that got better and better with that data, it ran away with the market. Nobody could hope to keep up because nobody else could get their hands on so much information. Google was protected by its hegemony.
Other enterprises need to get into this mode of thinking. They need to find a way to make themselves so much better than anyone else that new entrants simply can’t compete. Tesla is doing it. Amazon is doing it. And so can you. It’s all about finding an advantage that nobody else has and running with it.
Build On Existing Infrastructure
Companies like Oracle have spent years building out the infrastructure on which the modern economy depends. Oracle 5G PCF, for instance, is a kind of backbone for telephony networks that allows all of us to communicate with each other. And Siemens is less a software company and more an engineering product provider, creating tools for companies in the energy, healthcare, and industrial automation sectors.
Large businesses know that there’s no point in trying to set up rival infrastructures. That doesn’t make sense – and it’s wasteful. Plus, there’s usually no need for it either. The mere threat that somebody else might enter the market is often enough for established firms to keep their prices down.
Instead, they try to find ways to build enterprises on top of existing platforms. Facebook did this when it layered its social network-come-advertising-platform on the internet and personal computer. Amazon did this when it constructed its eCommerce store atop the internet and postal services. To some extent, even Tesla is doing this by tapping into the existing global lithium-ion battery supply chain.
Big businesses understand that they are a part of an ecosystem. Pushing against it is a recipe for disaster. The best option is to go with the flow, be careful with timing, and take advantage of opportunities as and when they present themselves.
Keep Things Fresh
Big businesses know that they have a problem on their hands. Once their organizations reach a specific size, they inevitably begin to become more rigid and bureaucratic. Everyone starts developing their own fiefdoms, leading to a kind of sclerosis – not what you want.
For that reason, a lot of the world’s largest companies attempt to keep things fresh by breaking up divisions and setting up side projects with full autonomy.
It sounds weird, but the thinking is simple. Large companies can’t usually change themselves from within because the incentives are too strongly in favor of stasis. So the best thing they can do is bankroll innovative startups that fall outside the traditional organizational structures.
Google tried this approach with its acquisition of London AI outfit DeepMind. The idea is that one day, this enterprise will become the leading company (or a large part of it), and it will grow out of the shell left by the old one.
The thinking is innovative and radical. But it is only something that large enterprises are doing. They see fragmentation as a way forward – a totally unexpected direction.
Experiment With Hiring Practices
Big businesses used to hire people with the highest GPA. Now, though, they’re a little savvier. Just because a candidate did well at school doesn’t mean that they will kill it in the workplace. Actually, sometimes the opposite can be true.
Large companies were among the first to experiment with different modes of hiring people. Instead of whittling down a shortlist based on grades and then assessing people in an interview, they’re finding more creative ways of getting to know people. One tool merely is inviting candidates to work with them provisionally to see what they’re like. Everyone knows that it is nothing more than a glorified interview, but it provides a much more complete view of the person. Enterprises get to find out how they actually work, instead of how they say they’re going to work.
Big companies are also experimenting in other ways. For instance, many Fortune 500 firms are giving up on the idea that they should just hire people who “win.” Instead, they’re wondering whether they should hire more failures instead.
The reasoning goes something like this. People who are used to failure are much more likely to be cautious in their approach. Furthermore, they’ve had a kind of baptism of fire – finding out the hard way how things can sometimes go wrong. Often they’re hungrier for success than their seemingly invincible rivals.
These kinds of innovations don’t usually occur at the small business level. It’s just too risky for a tiny firm to take a punt on somebody who doesn’t have a perfect track record. However, large businesses can absorb these risks because of their size and benefit from the rewards.
Big business is the master of branding. It’s partly why companies can get to the size that they do. When customers have a problem, they automatically think about a particular firm and convert. It’s as simple as that.
Large businesses know that if they want to create dynamics like this, they have to streamline their branding. Simple messages travel the furthest.
Streamlining typically involves picking one or two quick narratives and running with them. People don’t want companies to be novelists. But they do want something to pop into their brains when they think about them.
A lot of the world’s leading brands have a story to tell. For some, it really is just a sentence. Disney, for instance, wants to make dreams possible. Tesla is all about selling affordable electric cars. And Apple wants to make high-quality hardware that works.
These simple messages aren’t always intuitive. Often, it is hard to know precisely how to pitch your business. You want something that is true to life but creating it isn’t easy.
Today, video is one of the best places for enterprises to start. This type of content marketing appears to be more compelling than any other form. Users are more likely to remember what they’ve seen and get a better sense of what the company is all about.
Large enterprises are also telling stories about their products. They usually start with a promise about how their products can make people feel. For instance, sexy, healthy, happy, or wealthy. And then they generate a narrative around it. Sometimes this can be as simple as wheeling out a customer to talk about their experience.
Big businesses might not be the most popular in the culture, but they do a very good job of running hashtag campaigns. Always – the sanitary products brand – had its #LikeAGirl campaign designed to help fight against female subjugation.
Hashtags are a way for large businesses to jump on whatever cultural bandwagon happens to be driving past at a given moment. Recently, we have seen civil rights issues crop up across corporate websites in an attempt to show sympathy and support. It might sound like a cheap shot – and it is. But it works. Large companies immediately gain brand capital by taking the accepted view.
Photo by Pixabay
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