Lately I’ve been pondering a very simple question with a very complicated outcome: “What is a business?”
The question spawns from the recent wallstreet uprisings mixed with a healthy dose of reality as I’m faced with the world outside and how I want to go about looking for my own livelihood as I leave the protective womb that is school.
And, I’d thought about it briefly before, but I had a little thought that sort of paradigm shifted everything: bands don’t follow the rules. I mean, as businesses. They don’t ever really expand. You might gain some members or lose some members but at the core, they are a band together, not an empire. You can’t just keep hiring people into a band without some breakdown threshold of people count. But, there are different types of bands. Rock bands (for example) might have four people: guitar, bass, drums and vox. But then orchestras might have a 100 people each with various instruments and roles. They can be a strong group as led by their single director. The rock band might have a natural leader, but for the most part they are a classless organization.
So the lesson here, if it can be drawn, is that size indicates need for leadership. I look at – and have worked for – small design firms that might only have those four people but have a very centralized leader. It’s a snowball, where one person has an idea or a business plan and the skills to start it and the secondary and tertiary employees are either directly complimenting that skill set (be it more designers) or providing some further service (bookkeeping, marketing etc.) and more and more employees come and build up outer rings of service, all leading to that central first person. But then there’s this breakdown. At some point the organization changes into the hierarchy with leader > board > managers > employees (to simplify) instead of this circular ideal. It’s been said that Apple maintains this circular approach even with it’s monstrous size and thus maintains the start-up like communication between wings. So why doesn’t everybody take this approach? I suspect it has to do with the old style thinking that’s present in the generation that makes up the heads of these large companies. Remember, Apple is still quite young compared to, say, Sears. It’s hard to buck what is so entirely engrained in the company DNA and when the large companies started, that’s what the attitude was; power at the top that trickles down the pyramid.
But it’s tricky to implement that because unlike bands, your company will probably have to grow and with growth comes the need for communication between departments (and please, please integrate your departments. Again, see Apple) as well as that director in the middle. The entire orchestra can see him and hear each other. The entire rock band can see each other and hear each other. So I wonder if there isn’t something to be said for staying the rock band course. A core group of people deeply intuitive of each other all pushing for the common good of the group. Especially in design studios is this a seemingly practical business option. Sears can’t survive as four people, they’d never be able to staff all the stores and fulfill all the roles, whereas designers can stay small and be successful. I would look towards several industrial design groups as an example of this. IDEO is kind of the Rolling Stones with a long, varied career and relatively well known status without become a massive empire of business. Studios, like bands, don’t look for or need an empire to be ‘big’ (in the successful sense, not the pyramid sense) whereas other business (like retail) might.
And, as we’re learning with the super lean tech startups in the valley right now, staying small and agile can be a fantastic benefit. So, since we’re in the business that can afford to be this way, leverage it. I look at studios that try to expand so fast because they see this as success; building it big as a pyramid and not seeing the true reason they exist.
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