During a GE annual meeting when discussing entrepreneurial companies, Jack Welch explained why he admires them: "For one, they communicate better. Without the din and prattle of bureaucracy, people listen as well as talk; and since there are fewer of them they generally know and understand each other. Second, small companies move faster. They know the penalties for hesitation in the marketplace. Third, in small companies, with fewer layers and less camouflage, the leaders show up very clearly on the screen. Their performance and its impact are clear to everyone. And, finally, smaller companies waste less. They spend less time in endless reviews and approvals and politics and paper drills. They have fewer people; therefore they can only do the important things. Their people are free to direct their energy and attention toward the marketplace rather than fighting bureaucracy."
Presumably Bo Burlingham agrees with Welch, perhaps adding that the size of a company such as GE does not determine whether or not it has these characteristics. Rather, he would identify 14 companies which he calls "small giants." They range from Selima Inc. (a two-person fashion design and dressmaking firm) to O.C. Tanner (a company with 1,700 hundred employees and annual sales of $350-million). Although quite different in size and nature, Burlingham has identified seven common threads:
"First, I could see that, unlike most entrepreneurs, their founders and leaders had recognized the full range of choices they had about the type of company they would create."
"Second, the leaders had overcome the enormous pressures on successful companies to take paths they had not chosen and did not necessarily want to follow."
"Third, each company had an extraordinarily intimate relationship with the local city, town, or county in which it did business -- a relationship that went well beyond the usual concept of `giving back.'"
"Fourth, they cultivated exceptionally intimate relationships with customers and suppliers, based on personal contact, one-on-one interaction, and mutual commitment to delivering on promises."
"Fifth, the companies also had what struck me as unusually intimate workplaces."
"Sixth, I was impressed by the variety of corporate structures and modes of governance that these companies had come up with."
"Finally, I noticed the passion that the leaders brought to what the company did. They loved the subject matter, whether it be music, safety lighting, food, special effects, constant torque hinges, beer, records storage, construction, dining, or fashion."
No doubt there are countless other companies which also meet these criteria. Insofar as they and the 14 "small giants" which Burlingham discusses are concerned, nature of business is as irrelevant as size. If I understand Burlingham correctly, they are driven by the determination to be the best at what they do, to have close ties to their communities, to create a great workplace environment, to provide excellent service to their customers, and to be terrific customers to their suppliers. They regard profitability as a by-product of doing those initiatives. They wouldn't normally reduce an area of their operations to increase profitability (although sometimes they might have to). If they reduced it at all, it would be to achieve those other goals.
Burlingham suggests that his book be viewed as a "field report" on a group of extraordinary companies, each of which has (his word) "mojo" which he discusses on page 195. Although "small giants" may not be the backbone of the American economy, they are "its heart and soul, and they are setting a new standard for excellence on Main Street." When concluding this brilliant book, Burlingham asserts that businesses "are the building blocks, not just of an economy but of a whole way of life. What they do and how they do it have an impact that extends far beyond the economic sphere. They shape the communities we live in and the values we live by and the quality of the lives we lead. If businesses do not hold themselves to a high standard, the entire society suffers." Well-said.
Frankly, I envy those who have not as yet read Small Giants because, among its many benefits, it offers an eloquent, indeed compelling affirmation of values we should but do not always live by. With all due respect to Burlingham's business acumen, I appreciate even more his obvious faith in what can -- and should -- be accomplished if more of us became "small giants" of decency and integrity. It is no coincidence that many of those on Fortune's annual list of the most highly-admired companies are also on its list of those most profitable.
Burlingham urges his readers to visit www.smallgiantsbook.com where he plans to provide a form by which they can nominate other companies also worthy of recognition as "small giants." Leaders of the original 14 will then select the next group which will be recognized in Inc. magazine at which Burlingham serves as editor at large.
Those who share my high regard for this book are urged to check out Jason Jennings' Less Is More and Think Big, Act Small as well as Jim O'Toole's Creating the Good Life, Michael Ray's The Ultimate Goal, David Maister's Practice What You Preach, Robert Tomasko's Bigger Isn't Always Better, Michael George's Fast Innovation, and Yoram (Jerry) Wind and co-authors' The Power of Impossible Thinking.
