Entrepreneur’s age

There was some bad news for anyone running an SME yesterday – the big end of town might be finally cottoning on to the advantage that smart, nimble entrepreneurs have.

At a media conference in Sydney, the head of News Corporation’s Australian operations, John Hartigan, gave a sort of state-of-the-union address on the state of play in Australian media, revealing what he sees as the keys to success in what remains a difficult sector.

“The editorial stars of this new age will be those who are innovative, creative and entrepreneurial,” Hartigan says.

“They will be the ones who really understand what their audiences want, know how to exploit the new technology; and can put the two together to create and publish content people will pay for.”

Hartigan then went on to detail how newspaper publishers need to change their business models to adapt to the rise of technology such as smartphones, tablets and other mobile devices, and find ways to charge people for content.

It’s very interesting stuff for those in the media sector, but I think there are some wider lessons to extract here from the way that big companies like News Corp are now convinced that the only way to compete is to capture some of the way the small companies operate, by constantly innovating, by targeting niches and by developing rich understandings of customers.

Indeed, it’s telling that the word “entrepreneurial” appears five times in this speech.

“Instead of assuming that our scale and market power is unassailable, we have to start thinking like an entrepreneurial start-up,” Hartigan says.

So should SME business owners be worried that the big boys have finally woken up?

Not really. It’s very easy for large companies to talk about entrepreneurial behaviour, but much harder for them to reflect it in their culture and in their management structures – particularly where institutional shareholders are judging the company every three months in their quarterly results.

Where big companies could be successful is in developing small internal teams that are allowed to act outside the main corporate structure – sort of like bolt-on start-ups.

But even these business units will be tied to the corporate mother ship, which will almost inevitably slow them down.

Overall, SMEs should be alert but not alarmed. As long as they keep growing and changing to meet their customer’s needs, they will always have the upper hand.