Corporate Size

Corporate size has become a strategic decision. Neither “big is better” nor “small is beautiful” makes much sense. Neither elephant nor mouse nor butterfly is, in itself, “better” or “more beautiful”.

A transnational automobile company such as Ford has to be very large. But the automobile industry also has room for a small niche player like Rolls-Royce. Marks & Spencer, for decades the world’s most successful retailer, was run as a fair-sized rather than as a large business. Successful high-engineering companies are, as a rule, middle-sized.

Whatever advantages bigness by itself used to confer on a business have largely been cancelled by the universal availability of management & information. Whatever advantages smallness by itself conferred have largely been offset by the need to think, if not act, globally. Management will increasingly have to decide on the right size for a business, the size that fits its technology, its strategy & its markets. This is both a difficult & a risky decision- & the right answer is rarely the size that best fits a management’s ego.