Today I was asked what my thoughts were on the difference between working at a senior level for a large corporation, owning a small business, and being a solo entrepreneur.
I have experienced all 3 roles and others too. My last few years in the corporate world were as a marketing manager with a large food products manufacturer, responsible for consumer, industrial (B2B) and export markets. In that position I had a staff of over 40, a large departmental budget covering advertising, promotions, business travel and entertaining. I flew to cities around the country almost every week, internationally a few times a year and provided sales and profits kept increasing did not have many restrictions on what I did. It was a good, if somewhat stressful, life.
My years as a small business owner covered setting up an export trading business with 4 office staff, and a small food packing operation in a different city with a small work force. Later in a different country, I set up another food packing operation with a small staff, sold that and began farming, ultimately employing 180 people at peak season.
At other times, I have been a commission only salesman, consultant, managed a business for a liquidator and a few others. Now I am happily entrenched in the world of the self-employed solo entrepreneur. Almost certainly unemployable and quite happy with that classification.
What then are the major differences?
People frequently talk about security when working for a large corporation. It is an illusion. The only security is money in the bank, assets that can quickly be turned into cash or easily marketable skills. There have been enough big business failures from mismanagement, fraud, incompetence, inability to adapt to changing trends, and geographical shifts in the economic balance of power, amongst other reasons to convincingly dispel the myth of job security.
While overly powerful unions might delay the inevitable temporarily, eventually economic realities result in business closures, downsizing, retrenchment outsourcing and loss of jobs.
The illusion of security is greater in large corporations than small businesses partly because the majority of workers are far removed from the financial coal face. . It is also much easier to be lulled into complacency by the sense of substance conveyed by smart office buildings, modern factories, impressive fleets of corporate vehicles, publicity.
In a small business, when funds are tight, every one feels the chill quickly, it is hard to hide. Rumours of phone calls from unhappy creditors or difficulties in getting purchases approved tend to circulate rapidly.
This is an area where the corporate world has a huge advantage. The freedom to think and spend chunks of time on creative work that a department of competent staff allows a manager is a huge advantage. Having the financial resources and budget to replace equipment, vehicles and staff without having to worry about finding the money, not having to agonise over the cost of an air ticket to attend an important meeting or visit a valuable customer are all things that save time and stress.
Constantly worrying about money, making do with less than optimum equipment, stretching ourselves and our people too thin are all realities of life in small businesses and for entrepreneurs.
In a large corporation that has been in business for any length of time, there is a momentum that keeps things moving in the short-term irrespective of actions by individual managers. It’s the beneficial side of the same coin that causes inertia, resistance to change and complacency on its negative side.
The benefit for individual managers is that provided deadlines are being met, an hour, an afternoon or even a day here or there for non-essential work is of little consequence.
Even in small businesses, as long as there is a well organised work force, the owner can take small chunks of time away from the job of running the business without any noticeable effect on operations. During the Polo-Crosse season in Zimbabwe, I could disappear to a tournament with my horses for 2 or 3 days knowing that when I returned to the farm everything that should have been done would have been. I could attend a seminar, conference, cattle auction or social event, knowing that the farm was operating quite well with out me.
This is the area where the solo entrepreneur, professional person and consultant experiences the most disadvantage. Every minute we are not actively engaged in revenue producing activities, is a minute we are not earning. It is billable hours for a lawyer, hours with a patient for a doctor or dentist. Hours actually with a client for other professionals, hours putting words on paper or a computer screen for writers, copywriters, serious bloggers. Hours working on a client’s accounts or tax issues for an accountant.
When we take time to visit the dentist, get a haircut or attend a seminar, we lose money. For solo entrepreneurs just starting out with limited resources, this can be a very stressful situation to try to balance out. Once the cash flow starts becomes positive, it gets easier, we can outsource some of our routine activities and tasks – like book-keeping, some research.
There are good and bad to all 3 roles, but having been a small business owner and now flying completely solo, I would not change anything about what I am doing – except to do it better!
I enjoy the freedom of working from home, not having to put on a suit every day, no management or budget meetings. No commuting, flying and staying in 5 star hotels, (that novelty wears off very quickly). Now as a baby boomer and with the advent of all the “human rights” and labour legislation, I certainly do not want the hassle of dealing with staff, or refereeing their disputes.
I enjoy knowing that my income is totally dependent on my skills and abilities, yes I do wish at times that it was more consistent and increasing at a higher rate than it is, but both of those are under my control. I am not at the mercy of a salary review committee, shareholders or a boss that might not like me. I work longer hours now than I ever did in the corporate world, but that is my choice.
With the way the economies are heading in the West, it’s a choice more people are going to either have to make or it will be forced on them. The old model of lifetime employment is broken, un fixable. I believe we are headed towards the 21 st Century equivalent of the medieval artisan system. But using computers and hi-tech stuff instead of blacksmith’s forges and weaver’s looms.
Time to start your own little sideline so that you can easily crank it up into a cottage industry that will support you when the crunch comes.
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What do you think? Leave a comment.
Wishing you success in all your endeavours.