Do you have the right skills and training to succeed in small business?

A source of regular marital disharmony at my house is how issues at work should be solved. The end point of these conversations is generally one of us not speaking to the other for 10 minutes.

My wife has spent almost her entire career working for large enterprises. I, however, have spent the majority of mine working in small businesses. So it appears to me that the skills and behaviours required for success in big versus small environments, are completely different.

Consider this:

For big business, strategy means “what will next year’s business look like?”, for small business it means “how do I survive next month?”

Market research at the big end of town means crafting the right questions when you prepare a brief for consultants, but in small business it means having a relationship with your customers.

Sales for big business is about recruiting the right channel partners or designing your retail footprint, in small business is about closing the deal.

When it comes to accounting, for big business the issue is around selection and application of accounting policies, in small business the major focus is on getting your bookkeeping processes right.

When it come to financial reporting, the focus for big business is preparing financial reports for an external audience of analysts and shareholders, but in small business the financial reports are mostly prepared for an internal audience of management.

Good financial management at the big end of town means optimising your risk/return with your investing and financing decisions. In small business it has an almost purely operational focus, such as managing your day-to-day cashflow.

Valuation of assets or business units is based in comparative market data for the big end of town, but for small business its about discounted cashflows and value being in the eye of the beholder.

Supply chain management means investing in relationships for big business, but for small business it means getting the best from each transaction.

IT control means policies and methodologies such as ITIL for large enterprises. For small business it means managing your licences and anti-virus.

With HR, the situation is even different at a legislative level. For big business it’s about workplace rights and legislation. For small business the focus is about getting good people and keeping them.

And finally, when you talk about change, it’s a project for big business, where as for small business its part of the fabric of every day.

I’m starting to think that the word “business” is so generic that it’s meaningless. Perhaps universities should run commerce degrees streamed for small or large businesses, because the skills required for success are almost diametrically opposed. It seems to me that the fundamental difference is that to be successful at the big end of town, you need to specialise, but at the small end of town you will die if you aren’t a bit of a generalist.

Of course, we disagree about this as well.

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Brendan Lewis is a serial technology entrepreneur having founded: Ideas Lighting, Carradale Media, Edion, Verve IT, The Churchill Club, Flinders Pacific and L2i Technology Advisory. He has set up businesses for others in Romania, Indonesia and Vietnam. Qualified in IT and Accounting, he has also spent time running an Advertising agency and as a Cavalry Officer with the Australian Army Reserve.