Big or Bloated?

Today's organizations push to be bigger, wider (global), and highly profitable (not just profitable). The pressures to become "too big to fail" drive failure itself. Add greed to the equation and you have the 2008 economic crisis that we are now struggling to reverse. Good is not good enough, was the mantra of many companies in the early 21st Century; good to great (the name of a best seller about business) was the rallying cry. We have lost perspective. The challenges for the organizations of the future include balancing the drive to grow with the understanding that service and leadership sometimes mean contracting in order to do a few things really well as opposed to being everything to everyone.

It is interesting to note that the banks that got in trouble during the last few years were among the biggest. Many smaller banks fared well. So, the challenge for large organizations is to maintain a sense of the personal touch. Giant corporations would be better served to look at themselves as groups of smaller companies made up of real people. Some say they do this but how does that idea compare to looking at the stock price?

While working for one of the biggest companies in the world--General Electric--it was instructive to witness how the corporate culture took hold after our station was purchased by GE. Even though we were encouraged to be a resource for our own community, we also learned that we had to do things the GE way. NBC has slowly, but steadily, declined during the decades since it was purchased by GE; some of that is a consequence of other factors, but GE/NBC is big enough to be a driver of the trend. If large corporations--or other organizations for that matter--are going to thrive, they need to have character, diversity, and consistent quality. Bigness alone may actually hurt.

As we've learned in the last few months, too big to fail sounds rather foolish.

It's always seemed a bit too facile to blame all our ills on greed, but greed plays a big role. Ultimately, capitalism, socialism, all the isms offer only partial solutions. The communication scholar, Neil Postman, offered a view I share. The idea that capitalists tend to be creative and innovative must be tempered with restraint, not on their creativity or innovation, but on their tendency to inflict damage along the way. Since we know that self restraint tends to be minimal or absent in the face of certain temptations, the larger society, through government, public opinion, and the forces of the marketplace have to set limits. While my most conservative friends like to argue that the marketplace is the most potent force for regulation (self regulation), ideas based on Adam Smith and expanded upon by the University of Chicago economists who follow Milton Friedman, we are learning that the marketplace has limits.

Now we have to regulate the market place to make it work again. President Obama reminds us that while action is painful, inaction is worse, in terms of fixing the economy. So, as is the case with much of life, the real solutions come from many places. The biggest, grandest enterprises have their place, but if we don't have small boutique centers of excellence it all becomes a boring shopping mall, with all the same stores, whether you're in Tokyo or Texas.