Smallness Sells Big With Many Customers

"Smallness sells big with many customers."

As the dust settles over the rubble of the e-business earthquake, many analysts and pundits are trying to spin good news out of the carnage. "A shakeout was long overdue," they proclaim. "Only healthy companies will survive." I can agree with that.

But then they mistakenly predict that the big players will dominate the market henceforth. All of the small, "under-capitalized" little guys supposedly are perishing.

Qwest recently ran a snide, little newspaper ad featuring a fictitious "Buzz DSL" poster with an "Out of Business" sign slapped across it. The tagline was, "Seems like DSL providers are failing left and right. Make sure yours isnt one of them." Thats a mighty smug attitude for an outfit that still cant run DSL to my home, a mere eight miles from its headquarters.

Its the small fry whos thriving, based on my observations. You may have noticed that most of our "Solutions" case studies feature little outfits—even a one-person shop now and then. Theyre doing interesting jobs, making money and staying busy as cats on a mouse ranch.

In contrast, a photographer we recently sent to the HQ of a self-proclaimed "leading global e-business consultancy" reported, "They have a huge office space with mostly empty desks. I think a lot more people used to work there. It felt like a ghost town in the making."

Year after year, surveys show that two-thirds of IT system buyers choose a local solutions provider over nationwide firms. Even branch offices of megacorporations tend to buy from a local outfit, if theyre allowed that option. The message customers send is clear: Small is better.

Big companies do not foster personal relationships. Its difficult to get any comments—good or bad—out of the customers of gigantic solutions providers; they seem rather indifferent to their "partners."

Sometimes the customers project leader cant even recall the name of the solutions providers team leader.

But the customers of little solutions providers have plenty to say.

"Its great when the CEO takes our problems personally. I can call [Joe CEO] on Saturday if I have a problem," says one customer. All you get at MegaCorp on Saturday is an auto-attendant recording.

"All of XYZ Corp.s people are professional and very knowledgeable." Deliberately small solutions providers dont have to hire school buses full of green, recent graduates. They dont have a lot of people, but they have a ton of real-life experience.

"The big guys tried to force our problem into their business model. But Joe asked what we needed and then figured out how to do it." I hear that one a lot; customers love can-do attitudes and hate cookie-cutter "best practices."

"Joe gave us the right-sized solution for a tenth of what the big guys wanted to charge us for frills we didnt need." Thats probably because Joe doesnt have shareholders hounding him for double-digit growth figures at any cost to his customers.

Size does matter, but bigger is not better. Celebrate your smallness, and sell its benefits to customers. Youll both be happier in the long run.

Denver-based Dave Hakala is [email protected] Partners senior editor for networking. He can be reached at [email protected]