The Case for Small Companies

The Case for Small Companies

Taunee Besson, CMF, Senior Columnist

Scenario 1: Anthony M. hung up the phone is disbelief. He had just been offered a VP of Global Marketing position for the second time in the last two months, and he had refused them both. Why did he reject these offers of money and power, especially in a tight job market? Simple: He's already found his mission. A European training firm entering the U.S. market has given him the opportunity to teach executives how to reach their highest potential. As he sees his clients improving their careers and fostering good corporate cultures through his process, he can't imagine how a marketing position could possibly give him as much job satisfaction.

Scenario 2: While many execs get worn down by the daily grind, Jim L. loves working, even for long hours. With a job at a small, fast-growing employer committed to high-quality products and exceptional customer service. he talks enthusiastically about "doing exciting things like opening a plant in Guadalajara where the President of Mexico was in attendance, being awarded 'Supplier of the Year' and achieving recognition from top management for his innovative work.”

If you’re considering a move from a large company to a small one, you may have head a number of myths and truths about entrepreneurial firms. Most of the myths are perpetuated by stereotypes, and are only accurate in rare cases. And while the truths aren't new, professionals smarting from a poor economy, corporate downsizing, mergers or politics have only recently begun to discover them.

Here are some familiar statements about small businesses. Which ones can you believe?

Because small companies attract relatively little publicity, their impact on GDP is generally discounted. The National Association of Women Business Owners commissioned a study on female entrepreneurs, which revealed they employ more people than the Fortune 500 combined. Taken as a whole, small companies comprise a powerful economic community with tremendous impact on both domestic and global economies.

This can be true, especially in slow-growing, family-owned operations. However, there are a number of small businesses that provide equal or greater compensation packages than their larger counterparts. In addition, many entrepreneurs decide to start their own companies because of the upside potential for income. Going it alone may be riskier than working for someone else, but if you choose the right niche and succeed, your reward can be a top salary.

In addition, start-up companies funded by venture capital seed money generally pay their employees well because they expect them to produce quick, exceptional results. Quite often young organizations offer less in cash compensation, but give their workers generous stock options. As the corporation grows, executes an IPO or finds a buyer, these options can be worth millions.

This is often true, particularly in small, family-owned or stagnant companies. However, fast-growing small businesses must continually add employees and managers to keep pace with rising demand for their products and services. Because associates in these organizations wear many hats simultaneously, continuous on-the-job training is a requirement, as is an exponentially increasing set of responsibilities and job requirements.

Most large corporations rely heavily on education and experience requirements as screening tools in their hiring and succession processes. They want to put "square pegs into square holes." Many entrepreneurial managers, on the other hand, tend to think laterally when filling a position. While they may look for similar work experience, they can also be equally impressed with a candidate's enthusiasm and innate job skills. And, they are often more willing to hire a less-educated professional or someone trying to change careers. At an entrepreneurial company, what matters isn’t who you are, but whether you can do the job.

Jim L. is particularly impressed by the authority his company has given him to ramp up its tooling department to a more sophisticated level. As the company adds new plants, he is responsible for ensuring their tool and die designs meet quality, cost and efficiency standards as well. It would have taken many years and a much higher management position for him to have a similar impact on the large employer he just left.

  • Small businesses employ more people than big ones.
  • Small businesses pay lower salaries and provide fewer benefits than large companies.
  • Small businesses have fewer opportunities for advancement.
  • Small companies are more interested in an employee's ability to produce results than his specific work history or credentials.
  • Small companies often offer the opportunity to make a greater contribution to the organization.

If you’ve ever dreamed of owning a business or working for a small, nimble startup, don’t automatically dismiss it as a ridiculous fantasy. The current job market presents a great opportunity to ditch corporate life for the dynamic environment of a small business. In "Auntie Mame," a Broadway classic, the lead character says, "Life’s a banquet and most poor suckers are starving to death." Many employees have taken entrepreneurial leap and their lives are immeasurably happier and richer for doing so.

Senior Columnist Taunee Besson, CMF, is president of Career Dimensions, Inc., a consulting firm founded in 1979 that works with individual and corporate clients in career transition, job search, executive coaching, talent management and small business issues. She is an award-winning columnist for and a best-selling author of the Wall Street Journal's books on resumes and cover letters. Her articles on a variety of career issues have appeared on numerous career/job websites and trade and business journals. Ms. Besson has been quoted numerous times in The Wall Street Journal, The Dallas Morning News, Business Week, Time, Smart Money, and a number of other websites and publications.

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