Big companies are stupid
Bureaucracy in big companies can be a huge advantage for you as an entrepreneur. That is what I think after an absurd experience with a large Danish company that has bought my book E-pusher. They have received an invoice but want me to print it in the US and post it because they cannot use the electronic version themselves.
This is my rant here in January 2010. I get annoyed by how it is handled, but also try to see the upside: When big companies spend so much energy on their own systems, small companies have more room to compete.
The same invoice needs a trip across the Atlantic
A well-known, large and prestigious Danish company has bought E-pusher. Thank you so much for that. It is lovely that they want to learn more about e-commerce.
They cannot pay by credit card and therefore choose to receive an invoice. That is absolutely fine. Of course I offer that option, and they get a nice invoice sent to them, ready to print.
Then the nice marketing girl writes that they cannot handle an electronic invoice like that. They need one that has been printed and sent.
I reply that it is no problem: She just needs to print the invoice she has already received. But no. They use SAP, and the accounts department cannot use it that way.
What the hell is the difference between her printing it and me printing it? So I have to sit in the US, print it, put it in an envelope, add a stamp and send exactly the same invoice to Denmark before it can enter their fancy system.
I joke that the whole process probably takes a day’s work. In return, the boss can sit on the golf course with his laptop and see what every penny was spent on. That is my sarcastic comment, not a measurement of their time.
Bureaucracy in big companies shifts the focus inwards
To me, it is an example of why you have so many opportunities as an entrepreneur. I think big companies can become so fucking stupid you can hardly believe it.
They become more concerned with figuring out where the money went than with making more money and beating competitors. The internal system takes up too much space.
I explain it with a hypothetical calculation. When you work alone, you direct your efforts towards the market. I call that 100 per cent in the right direction.
Hire one employee and perhaps 80 per cent of that person’s energy goes towards the market. The rest goes on the relationship with you, the job, meetings and other things. That is still fine, and things are still moving.
More people mean more internal relationships
Hire another and there is also a relationship between the two employees. They need to work each other out and establish the pecking order. In my example, their focus on the market therefore falls to 75 per cent.
You, as the boss, also spend more time internally and perhaps drop from 100 to 70 per cent. With a third employee, the figures fall a little again. These are illustrative numbers I use to explain my point, not documented productivity measurements.
Each new person adds more connections that need attention. And eventually there is HR, staff welfare and all sorts of internal conflicts the organisation needs to handle.
In the video, I exaggerate the picture with employees who dislike one another, departments arguing and an accounts department fed up with everyone else. That whole monster can take energy away from the market, products and innovation.
A strange chair does not create innovation
I say that in a company with a thousand employees, perhaps only five to ten per cent of the effort is left for the market. That is my very blunt estimate in the video.
The rest can go on meetings, relationships with bosses and innovation days. I make fun of the idea that you become innovative by entering a strange room where the chair hangs from the ceiling.
It is enough to drive you mad. But as a small business, you should actually be happy that your big competitors can be so preoccupied with themselves.
The small business can use the advantage
You and your business partner or your three or four employees can get a lot done. My claim is that in some situations a small team can do things that would otherwise require a company of twenty, thirty or forty people, especially if you also use freelancers.
So instead of just getting bloody angry about experiences like that, perhaps I should turn the thought around. And you can do the same: How bloody great that big companies can be so big and stupid.
My irritation about the invoice is still real. But it reminds me that a close focus on customers, the market and the work is something small businesses can use to their advantage.
The bigger a company is, the stupider it gets. Fortunately 🙂 Best wishes, Martin
Location:E Plaza Real,Boca Raton,USA
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