Small Company Thinking - the art af being "Folksy"

My last company was small by most standards; about $40mil in annual revenue. We had been struggling, and were eventually purchased by a private equity firm. Of course private equity does not usually buy healthy companies, they buy sick ones and fix them, or dissect them and divest of the assets if the numbers are in favor of that. We were lucky in that our owners brought in a new CEO that was a real sales guy, and knew that the key to success was a true focus on the customer. Seems obvious, but so few companies truly get it.

To make the long story short, we had great success fixing the company, and it was eventually sold to a very large software company. As is often the case, we were culturally at odds with the new company. They were very internally focused, much more concerned with the proper paperwork being completed than with doing what was right for the customer. Very heavy process centric approach to everything. We were often scoffed at, with our "small company thinking" approach to things, and were repeatedly told "that is great, but it would never work in a big company".

As an example; I used to do lab tours for visiting potential customers. Deal win rate when getting the customer to visit and take a tour was near 90%. Within days of the acquisition close, this stopped. When I questioned a visiting exec as to why we no longer did customer visits, given the high win rate, I was told "That just wouldn't scale. If all of our sales teams sent every prospect here, you would be completely overwhelmed". True I said, but we went from three per week to zero, and we could easily support five. If we had more requests than that, we would figure it out, maybe tape it and use video for the smaller deals. "Small company thinking" says he. Nonsense. An excuse from big a process guy for not taking action.

When I arrived in my current position I was part of the management team brought in to help turn the company around. Yes, we have the same private equity owners (see a trend?). This company was bigger than our last success, by about eight times in revenue, and maybe four times in number of employees. As we started making changes, and refocusing the company on our customers, we heard much of the same thing; "That may have worked at a small company, but it will never work here".

Ha! It has worked. And not just as it relates to IT stuff, but everywhere in the business. It is harder to make it work in a larger company, and it is critically dependent on having the right people, particularly in the leadership roles, but it is very effective when it does work. We now find ourselves operating as a more or less independent division of a much larger company, though still under the same private equity ownership. Our larger siblings have called us "Folksy", saying that the way we do stuff works in a little company like ours, but big sophisticated companies do it their way (which usually means with an army of consultants).

To all of you that run "folksy" business, please keep it up. It works, and the folksy businesses are much more fun to work at and to do business with.