How Small Companies Can Innovate Like Big Enterprises Small businesses are steadily on the rise, and are projected to only get more popular in the coming years.
By Daniel Newman Edited by Dan Bova
Opinions expressed by Entrepreneur contributors are their own.
When it comes to business, speed is a weapon that separates certain organizations from the competition -- but, its speed can also be harmful if not handled correctly. In the age of digital innovation and transformation, small companies have burst out of the gate to disrupt traditional business molds. Today's Fortune 500 list is a mere shadow of what it was in 1995. In fact, fewer than 50 percent of those who were on the list in 1995 still remain today. That's a big change in just 20 years and the evolution is continuing to happen even faster.
This change has been largely due to those aforementioned smaller companies and startups and their success holds exciting promise for entrepreneurs of the future. But what made those small startups leap to the top, while so many others grew slowly or not at all?
Related: 5 Ways Small Companies Can Out-Innovate Big Corporations
The key to startup success.
The answer is innovation and speed. Where big corporations generally have layers and layers of corporate bureaucracy to wade through, not to mention the livelihoods of thousands of employees in their hands, and many stock and stake holders to answer to, smaller companies have always had the advantage of being able to pivot fast by making quick decisions. They're freer to be spontaneous, and to change their business model according to the latest trends.
Technology like cloud computing, big data, and the move to mobile are helping to launch startups faster than ever before. Being open minded, and embracing these innovative new business platforms and models, smaller companies adopt change quicker than large corporations.
Small companies keep innovation at the very heart of their goings-on, using it to propel their business into the limelight, yet at the same time remaining sensitive to the needs and wants of their consumers.
How to cultivate innovation in your small business.
By making creativity a building block of your business, you can encourage your employees to generate new ideas and embrace the newest technologies, enabling you to harvest better business plans and capitalize on the latest innovation in ways the big enterprises can't. Every company wants a leg-up on the giants of the industry, but most don't realize they already have a head start.
Related: Innovation: Small Businesses Live It, Big Businesses Buy It
Creating an atmosphere of internal communication, constant connection, and positive energy, small businesses can not only begin to transform their workplace into a company of the future, but they can beat their larger competitors. Startups everywhere are opting for flexibility over the old way of doing business -- encouraging employees to work from home, come up with new ideas and be an integral part of business processes instead of just a workhorse. These changes will ultimately lead to a company better able to serve the evolving needs of consumers.
Why small businesses will overtake big enterprises.
The 21st century is the age of the underdog. People everywhere love nothing more than a good rags-to-riches story, and they are supporting local and small businesses more often than larger corporations. My prediction is that small businesses will continue to challenge and at times beat the large enterprises (perhaps sooner rather than later), simply because they will appeal to the consumers desire to support the up and comers, the dreamers and the entrepreneurs that are often much easier for people to relate to.
Small organizations can embrace innovation and profit from their lack of size and increased flexibility, promoting rapid growth. A smaller staff allows for increased employee connectivity, minimizing the corporate gaps large businesses suffer from. Small companies can faster adapt to new situations and new technologies, benefits that will help them become just as successful as big enterprises -- all the while retaining their edge. Not only are small companies capable of widespread success: The odds of a startup succeeding are better now than ever.
Related: The Feds Have $2.5B Available to Fund Innovative Small Companies
If you had any doubts about the foothold your small business has in the larger scheme of things, take a breath. Small businesses are steadily on the rise, and are projected to only get more popular in the coming years. Millennials are attracted to small, local businesses that support the community, and are pouring their physical and monetary support into startups instead of into big corporations. By encouraging innovation and embracing change, your small business can be on its way to outpacing industry big shots.
