From: ricci@cbmvax.commodore.com (Mark Ricci - CATS)
Newsgroups: comp.sys.amiga.advocacy
Subject: Re: I DID giev up on the Amiga!
Date: 28 Jul 92 18:28:09 GMT
Reply-To: ricci@cbmvax.commodore.com (Mark Ricci - CATS)
Distribution: comp
Organization: Commodore, West Chester, PA

foax@vax5.cit.cornell.edu writes:
>> I don't think you should consider big to be better, especially as we
>> move into the 21st century.  While a big company can have a lot of
>> financial resources, it can also have a large, moribund bureaucracy.
>> I think GM would be a good example of this.  They certainly have the
>> resources, and they have the talent, but they also have a bureaucracy
>> that impedes progress.
>
>GM is certainly a fine example of a VERY big company with a large,
>moribund bureaucracy, but there are plenty of examples of big
>companies without large bureaucracies, especially in industries with
>plenty of competition.  It is these companies which tend to survive.
>Boeing and Airbus come to mind; those two are taking control of the
>air transport marketplace because they are both large and adaptable.
>Their slowly dying competitor, Douglas, once ruled the airliner
>markets, but failed to adjust quickly enough when jets were introduced
>and has been playing catch-up ever since.  It is doubtful whether
>Douglas will survive the decade (although McDonnell, which now owns
>it, may survive).  Unfortunately my dad works for them.
>
>The big Japanese corporations come to mind too.  These are very large
>firms with their hands in many pies, but they have been astute enough
>and quick-moving enough to take over the consumer electronics industry
>and to knock the US auto industry for a loop.  Apple is also a large,
>quick-moving firm, as is Microsoft.  IBM probably falls in between
>here, but this is almost certainly due to the fact that they dominated
>the computer industry for so long without effective competition.  Such
>competition is now forcing them to change their ways.
>
>It seems to me that the size of a firm and its nimbleness and
>adaptability are only weakly correlated.  Perhaps a better (inverse)
>correlation exists between a firm's adaptability and its self-perceived
>security in the market:  if a firm thinks it has a lock on its market,
>it has little incentive for change.  This is only a supposition on my
>part, of course.

It's not a given that all small companies are nimbler, but generally
they lack a lot of the bureaucratic impediments of large companies.
You can find large companies that innovate on a regular basis and the
chances are good that they are organized either as separate, autonomous
units or the company provides support for work apart from normal duties.
3M, for example, supports work outside a person's direct responsibilities
as a means of fostering innovation.

You do make a good point that being complacent has hurt many companies. The
auto industry is a prime example.  Those guys thought they were invincible
and continued doing things as they always had.  They've certainly come a
long way, but I'm still not sure they've completely gotten it yet.  I would
blame that on the bureaucracy.

My original point, though, was that a small company is not necessarily at a
disadvantage just because it's small.

>> The way economies work now with fast changing markets and new
>> technologies, the samll, nimble, fleet of foot companies are the
>> successful ones because they can adapt quickly.
>
>While the rate of technological and market change has increased, I
>don't think the fundamental workings of firms have changed as much as
>you suppose.  I've already commented on size vs. adaptability, but I
>might add that there are quite a few small American startup companies
>which have introduced new technologies, only to see themselves beaten
>in the marketplace by large Japanese firms who have the engineering
>talent to make someone else's new design workable, the production
>capacity required to make large quantities of product cheaply, and the
>marketing power needed to sell the product to the public.  (Excuse the
>national comparison in the last sentence, as the same situation has
>undoubtedly arisen in other countries at other times.  The current
>trade frictions simply come easily to mind.)  Furthermore, there is no
>shortage of innovations by large firms: the Trinitron display tube
>(Sony), the 3.5 inch diskette (Sony), and the compact disk (Philips)
>come immediately to mind.

I believe the fundamental workings of the business environment have
changed; I don't believe the fundamental workings of firms have changed
in enough instances and therein lies the problem.  Too many firms in
this country want to cling to outmoded ideas of how things are done and
decisions made.  As it becomes apparent to a company that its outlook
and ideas are based on a business model that is no longer valid, you
begin to hear talk of downsizing, employee empowerment and
entrepreneurship.

You can also find startup companies that are successful.  Being small
isn't a guarantee of success, it's just not a handicap anymore.  I
don't deny that large firms have advantages over small firms, but only
when the large firms are run like small firms.  You don't get
innovation by having all decisions made at the top, but you do get
innovation when the top preaches innovation.

>> Plus, for my money, it's a single person or a small group who make the
>> breakthroughs, not the 100 member teams.  There's no reason to believe
>> that a small group of engineers cannot accomplish a great deal just
>> because they're a small group.
>
>You may well be right.  In which case a large corporation would be
>wise to split its design staff into many small, independent teams
>rather than a few large ones.  The teams should only have to interact
>when there are important interactions between their respective
>designs.  But a big company, suitably organized, can field far more of
>such teams than a much smaller company can.  In some cases, the
>product being built is so complex that it cannot possibly be built by
>only a few small teams without a severe slowdown (kind of like the
>advantages of parallel processing :) ).  In this case big firms have a
>much greater advantage.

Only if they are willing to decentralize control.  Bureaucracies are not
amenable to being dispersed.  Yes, a big company can field many small teams
backed by its formidable resources, but that also shows the viability of
small companies.  A complex project may only be the province of a large
company, or it may be one coordinating company with one or more
subcontractors.

I don't deny that big companies have advantages. It's just that small
companies have a better chance now of being successful than they did
in the past.

>Right now everybody is cutting, and the least successful guys are
>cutting most.  IBM and GM are two firms that are trying to become more
>adaptable after having grown used to market dominance.  (Dupont I know
>nothing about.)  I'm sure quite a few small firms which few people
>have ever heard of are going bankrupt as we speak.  But it's the big
>ones that everyone hears about, as they cut the most employees and
>make the most news.

Companies are going bankrupt all over, big and small, that's nothing
new.  What is new is that growth is occurring in the small and midsize
companies while the large firms are shrinking.  It's not that a large
firm makes news solely because of the number of people it cuts, but
because it's cutting at all.  It shakes people up to see the "get a job
there, you're set for life" firms cut back, and seemingly all at the
same time.

>> My only intent in responding is bring up an important point about the
>> economy of the 1990s and the 21st century.  It's something that should
>> be discussed as part of this year's election campaign.
>
>We'll see.

Hopefully we will.  There have been fundamental changes in the way
business and work are done, that are not reflected, by and large, in
people's opinions.  As I alluded to above, the idea of joining a company
and staying for life is still held by many, even though most people will
have more than one job (I've heard it put at 5-7 jobs) in their lifetime.

So long as people cling to that idea, we're going to have problems moving
forward or seeing different solutions.  That's why I want to see this
and related subjects brought out in the campaign.  Let's get an idea who
is better suited to deal with this type of economy.



Mark
-- 
===============================================================================
 Mark Ricci - CATS          |   Perot For President -- oh well, not anymore
 Commodore Applications and |             Hello, Andre Marrou
 Technical Support          |             
 ricci@cbmvax.commodore.com |       (but I'd still rather have Jack Kemp)
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Newsgroups: comp.sys.amiga.advocacy