How big should we allow corporations to grow?

[caddmannq]

We have 9 people at my office. Today I walked outside for a smoke and left my paycheck (checkbook, passbook, security pass, etc.) just sitting on my briefcase on top of my bookcase in plain view.

But I know everybody here like my own brother, and I never gave it a second thought. I could have left a million dollar bearer bond on the desk and it would still be there when I got back.

While I was sitting outside, it occured to me that I never would have done that at any of the huge offices I'd worked at over the years.

This Enron/WorldCom/Xerox debacle started me thinking about how much I dislike working for (or with) big companies. With so many people in one organization, nobody can really be secure, either in their job, or their personal effects.

This is the dangerous side of letting corporations, conglomerates, & monopolies grow too big. The greed, ineptitude, or problems of a few at the top can upset the lives of thousands and thousands of workers and investors when the business crashes, or somebody decides that the Cayman Islands looks like a good place for a fast getaway on the corporate buck.

I thought that the anti-trust laws were supposed to end the age of the robber barons, but evidently there were some big loopholes.

Every good broker will tell you to spread your investments out so that you are protected from the downturn of a single business or industry. It seems like we, nationaly and internationally, are putting those eggs in fewer and fewer baskets. Not a good move, IMHO.

So I urge you, as workers, to avoid the big companies like the plague. If you have any choice in the matter, spend your efforts to grow with a small company, and foster diversity and competition. Maybe it's your kids that get caught in the mega-layoffs of the future.

Well, while I agree, there are some advantages in being a small fish in a big pond too.

Large corporations (I worked at John Deere and am with Morgan Stanley) have very good operational systems and very few ad hoc decisions are made. You also get experience managing large number of people. The resources of a large company can be useful too.

I have also worked in small companies (though not as a big fish). Everything has to be Okayed by the President. Travel is scrutinized too closely even if you are within the rules. You have to ask for your commissions/bonus-payments are not made as proper tracking systems are not in place..... Often, in a family run business, everything is at the whim of the President-which can be good and not so good.

I'd suggest to newly graduated guys to start in a large/medium size company, learn the ropes and then come to a smaller company.

[Knothead]

Every good broker will tell you to spread your investments out so that you are protected from the downturn of a single business or industry. It seems like we, nationaly and internationally, are putting those eggs in fewer and fewer baskets. Not a good move, IMHO.

I agree. And to elaborate on your point, Cadd, the REASON those eggs are going into so fewer baskets is the because of the "merger Mania" we've seen so much of...I mean, come on, Time-AOL-Warner??

Eventually, we won't have countries anymore, just vast corporations. About a dozen, maybe!

Yeah, how big? But to limit the size of these monsters? Not gonna find much agreement in those places that count, where laws get passed against these monopolies...

[Epidemic]

Bigger is often better and sometimes you should run big business with a little guy mentality.

Having to justify you travel is a smart thing for any size business to require. Taking a trip should have a value added tangeble or at least the potential of tangebility. I have worked for large companies where the taking of a trip was abused to the tune of 30,000 for one employee. That adds up real quick if you multiply it by a few thousand. Big companies can leverage more with their financial might. Allowing them to reduce costs to the end user. But a sloppily run mega business only saves a little in the end. Beauracracy and red tape of top down management can be rediculous. In the end it is cheaper to use the mega companies product. But a truely well run mega company would be tremendously cheaper.

[caddmannq]

Well, as Shahani works for my broker now( ), I've got to agree that he makes some good points. Small companies can often be poorly run. But when things get out of control there, it doesn't take much effort to find out what happened, who screwed up, and to get things back on track. But they're not gonna file bankruptcy until the bitter end.

Enrons, for instance, can be worth billions, and yet fail to weather the financial storms because the guys at the top can just decide not to. Ain't no storms in Aruba, baby.....

[kenyg]

Cadd - same here - somewhat - I work in a satellite office - there are 7 of us. Life is usually good, and the normal 'rules' are a little more lax. We're our own business unit, and our contribution/profit margins are great.. But, recently, I've been involved with corporate suits from the 'home office' (gotta rebrand you see....) and I find myself feeling alot like Dilbert..

I don't like big.. given the choice, I prefer to do business with local independent firms..

90% ( or some such large %) of business in the US is small and very well managed, loyal employees, security and so on.

Guess the are advantages to both-but reverting to the original topic, size is important to success. There is an optimum size. Even in governments around the world, the smaller states and countries are often better managed. Beyond a certain size, companies become so complex that the human brain can't really comprehend and the corporation as a single entity.

Ergo, there can't really be a vision that trickles down. Such large corporations eventually become so bureaucratic that they self-destruct or simply become independent divisions operating autonomously under a common corporate umbrella.

I'd say the optimum size would be around 500 people total with sales turnover of under $100 million. Such a corporation could really be managed very well.

[Epidemic]

Shahani,

Then you would not like to see even an automotive plant???

I like the Idea of the corporate umbrella with small divisions.

But that logic applies to even the largest of companies. You do have the empowerment problem where the head office does not give the proper power to the sub groups. Or they siphon the good, profitable branches to assist failing ventures.

This siphoning can be good or bad depending on the outcome and the quality/future of the good one. This is both the power and downfall of major corporations and the leaders must make the right choices.



I have a question since the 911 event how many people have lost their jobs in the so called small businesses. How many people lost their life saving in the down turn of the economy.

I contest that the big companies are not all that far from the small guy in how many people got hurt. It is just more concentrated and reportable.

[Redwolf]

Companies are too big when they overstep thier bounds and shroud it in beaurocracy. Best example is M$ and the Pallidian chip. I read about it and chuckled "So Microsoft gets serious". Then I read an article on this fourm about the true purpose of the 'fritz' chip. If only the public knew....

If only USA today cared...

[Brainchild]

Well I have never worked at a really big company. Did some factory work when I was younger, and hated every minute of it. Seems like your just a number to the head brass, most of which didn't even know my name. At 17 I got into service station work, gas, flats oil changes. Just 4 of us in the whole place. everyone knew everyone.Since ,I have always worked in that type of atmosphere. just 3 or 4 of us, and getting along as friends. Much better way to survive the workforce.IMO, it's a much more relaxed,less stressful, more rewarding job. I'd never work in a factory again.
I can't even imagine a big office building.