Monday, January 1, 2007

Differences - small and large businesses?

I went from working in an R&D (product development) organization in which I had 1400 people around the world working for me to one in which there were about 30 people in product development - all in a small building.

In reflecting on the differences I was most stuck by the similarities. People in product development tend to think alike and the quality of the individual engineers and scientists were comparable. Also the type of technical challenges were the same.

One clear difference that was evident from the beginning though was decision making time. In DuPont our product decisions had to be reviewed by all effected around the world. This often resulted in endless debates about what the product specifications should be. This was not bureaucratic people trying to delay things - it was good people with different views who wanted to influence the decision and to be sure the resulting product would sell well in their markets. The net result was incredibly sluggish though. And because I grew up in that environment i was not aware of how terribly slow it was. I am talking about one to three month delays at making decisions.

Then I began working at DTM Corporation in Austin - a start-up with total employees of about 100. The CEO and Vice-Presidents as well as the engineers and marketers were bumping into each other daily. Very important decisions could be made in one day - sometimes by a group standing in a hallway drinking coffee. What a delight that was. And what a competitive advantage!

Were the decisions as good? I could not see that much difference at first. But over time we learned how to improve product development decisions at DTM (the small company) by gradually installing a structured and disciplined decision making process. And that process improved the product introduction cycle time significantly. I may discuss that process in a future post. One of my fundamental beliefs is that even very small businesses need disciplined decision making processes. And a good decision making process does not slow things down - it can improve cycle times.

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