Nilofer Merchant in her HBR Article ‘Our Obsession with scale is failing us‘ talks about how the large organizations ignore the smaller looking opportunities and fail to be wired for the future. She cites an example of Bank Of America which ignored new payment methods like Paypal and Square. She talks about the business parameters that shunt out all opportunities less than a certain dollar value, even ignoring the fact that the current dollar value may be less but the potential may be high. A very valid point.
She also hints that the value that the industrial age attached to Scale is also changing its meaning in the social era, where the world is centered around individuals and technology can be as big an enabler as the other scales were once. I agree.
My thoughts on this – do we really need scale in the world or is it time to go back to ‘Small is Beautiful’ strategy. Is scale needed for the business that is good for the corporation and the customers or is it needed to give the corporate entity an ego boost, to be able to top the various lists published as part of a business strategy of the publishing houses? Till we question the need for scale, we will blindly work towards building the scale because we grew up admiring the big.
It is time to look at the inefficiencies that scale brings in and reminds me if this book – Peters Pyramid