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New breed of companies use new tech to advantage

"Emerging technologies are allowing progressive companies to leap ahead of others still struggling to figure things out," writes Phil Simon in his book The New Small: How a New Breed of Small Businesses is Harnessing the Power of Emerging Technologies. He singles out five technologies that he refers to as the "five enablers." Here is an excerpt from the book:

It seems to me that many small business owners are awash in a sea of technology they aren't using. Most haven't explored mobility, cloud computing, social technologies, and so on. They aren't keeping up with many of the changes that could significantly help them on so many levels.

I began to wonder about why so many small business owners seem to be unaware of the profound technological changes currently taking place.

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Reasons include:

  • Some are just overwhelmed by the rate of change.
  • Some just don’t care – they don’t plan to change anything if they can avoid it.
  • Some are probably intimidated by these new technologies.
  • Some just aren’t aware. Their attention is elsewhere.
  • Some subscribe to the view “If it ain’t broke, don’t fix it.”

I suppose that this would make sense if these emerging technologies offered only marginal improvements to John Q. Business Owner. But that's just not the case. These days, many small companies ignore technologies that, at a minimum, can help them significantly:

  • Grow their businesses
  • Attract talented employees
  • Improve access to key information
  • Increase employee communication and collaboration
  • Reduce costs of recruiting, IT, and marketing
  • Compete with larger companies

Some small businesses are using emerging technologies in creative and interesting ways to achieve these benefits. These are the New Small.

Today, emerging technologies are allowing small businesses to do amazing things. From a technology perspective, they can act big and scale just as easily as larger players. No longer are powerful enterprise technologies necessarily too big or too expensive for small businesses. In many cases, smaller companies can do exactly what the big boys can do at a fraction of the cost.

From a people management perspective, new communication technology, for example, can be a godsend. Employees are able to work wherever and whenever they choose. Increased flexibility is, in fact, a major reason that many people work for smaller outfits or start their own shops.

Other motivations include the ability to have a greater impact at work and the desire to be one's own boss. Although the reasons vary, many New Small founders had similar motivations in deciding to start their own businesses.

For several reasons, it's no longer a liability to be the little guy. The last five years has seen a massive explosion of available and viable business technologies that allow small businesses to compete. In general and compared to their larger counterparts, small companies are simply better able to adapt to changes and move in different directions as needed.

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Small businesses are now leapfrogging big companies, effectively deploying new technologies faster, more effectively, and at lower costs.

But it gets better. Yes, compared to big companies, many small businesses are adopting new technologies at both greater speed and lower cost. These represent two sources of a new competitive advantage for these nimble, agile companies.

At the New Small, new technologies are enabling a completely different mindset and definition of work. Smaller outfits and startups are attracting top-flight talent because, to some extent, they allow work to be done anywhere: from home, on a beach, or in a coffee shop.

This tech-friendly ethos is allowing employees to work on their own terms, addressing the work-life imbalance from which many people suffer. In this vein, the New Small is using technology strategically to win the war for talent.

So, there's good news for small businesses on several fronts. Emerging technologies are allowing progressive companies to leap ahead of others still struggling to figure things out.

But which technologies are making such a dramatic difference? There are five specific ones. I collectively refer to them as the Five Enablers:

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  • Cloud computing
  • Software as a service (SaaS)
  • Free and open source software (FOSS)
  • Mobility
  • Social technologies

New Small companies effectively deploy and use the Five Enablers. As a result, they have the same – or even superior – technology compared to organizations 10 times their size, often at a fraction of the time and cost.

What's more, these businesses go from technological laggards to leaders.

Progressive small businesses have always looked for ways to do things better, faster, and cheaper while concurrently maintaining focus. In this manner, the Five Enablers are merely means to traditional ends.

The Five Enablers are doing so much more than allowing New Small companies to upgrade their technology and reduce their IT budgets: They are enabling employees at these companies to work in much more fulfilling jobs. Fewer employees' jobs are rigidly defined and compartmentalized. Ask many owners of New Small companies to name their head of IT, for example, and they will probably say, "Well, we all sort of pitch in" or "It's probably Steven today."

The New Small is creating more meaningful jobs, and in the process, turning long-held management theories on their head. In some circles, they are reversing Scientific Management, the theory developed by Frederick Taylor in the late nineteenth century and largely adopted by many businesses around the globe.

No longer does work need to be excessively specialized, repetitive, and mind-numbingly boring. Through the Five Enablers, the New Small is injecting a much-needed sense of excitement into many workplaces.

Astute readers will note that these technologies have existed in one form or another for quite some time. They may be more evolutionary than revolutionary.

So, what has changed? First, as with bandwidth and storage, over the last 10 years, these technologies have become significantly less expensive and even more powerful.

The net result: By and large, small companies are now able to afford these exciting technologies.

Second, deployment is far easier and more flexible. No longer do small businesses have to attempt to predict just how much technology they will need – and face dire consequences if they are wrong. Today, a company of 200 employees can scale its technology in the same way that a 20,000-employee company can.

Third, success begets more success, creating a type of network effect. Technologies become more popular because, reflexively, they are already popular. For example, as more companies have adopted cloud computing, others become emboldened to do the same.

Lessons and case studies become available as different technologies and products become more mature. While the evolution of technology is by no means finished, with respect to the Five Enablers, we certainly understand a great deal more than we did five years ago.

Excerpt adapted from The New Small: How a New Breed of Small Businesses is Harnessing the Power of Emerging Technologies , by Phil Simon, published by Motion Publishing LLC, Copyright 2010

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