Small businesses, large companies, and American dream

A medium-size business owner has responded to an article about business picking up in large companies by saying that his company has lost half of its employees over the last two years, and that the large companies growing are a result of the Obama administration "taking care of its own." There are many reasons why this line of argument is wrong.

First of all, Obama became President through popular vote - 53% - and not by dictate of major corporations. Secondly, large companies have all once been small companies, that have become large companies by virtue of having either superior product or superior marketing; and for "money talks BS walks," "we are the winners everyone else are losers," "America: love it or leave it," people to decry large companies or to blame Obama for themselves becoming the "losers" that they despised aggressively for three decades is hypocrisy on a vast scale. And finally, there are enough large companies that possess the virtues associated with small companies. Which means that it's not the size, but the practices, of the business that count.

Small businesses are associated with personal loyalty, whereas large corporations are associated with impersonal and cold treatment of workers. As someone who's worked for companies ranging in size from one employee to over 30,000 employees, I can say with full clarity that this is not always the case.

Among large companies for which I worked, the biggest one - Oracle - had none of the flaws associated with large corporations. It had a dynamic management structure in which people at all places participated in the decision-making process and in which management was close to the employees. This style of management built loyalty that is commonly associated with small businesses and seen as amiss in large organizations; to the point that, even though it's been 12 years since I last worked for Oracle, I still retain respect for my managers and co-workers as well as for Oracle Corporation itself.

With large businesses as well as small businesses, one reaps what one sows. The 19th century- style management model in which the managers are distant, hostile and abusive to the employees creates employees who are hateful and disloyal to the company. A more interested, involved management model, such as what was practiced at Oracle, creates employees who value and appreciate the company. This is the reason that there was an aggressive union movement in steel and car manufacturing industries, but not in the computer industry. The software industry leaders have learned from the mistakes of their predecessors and created business environments in which people care about the company and are willing to do their part as employees.

There are many people who see running a small business as being American dream. It is not however the dream of every American. Many Americans are perfectly happy to work for larger companies; to work in education, journalism, science, military, law or medicine; to rise through the ranks in large companies; or to have more than one career during their lives. Furthermore, one thing that happens in business naturally is that larger companies grow by swallowing up smaller companies. Which means that it is capitalism, not Obama, that is the reason for some smaller and medium-sized businesses failing and some larger businesses growing.

Are large companies better than small companies? Absolutely not. There are wonderful small and medium-sized companies out there, and they include most of the ones for which I have worked. But to claim that small businesses are in all cases better than larger businesses, or that small businesses are real America and the rest of America isn't real America, or that large businesses grow through nepotism, is ridiculous. The real problem, historically, with larger corporations has been their rigidly hierarchial and authoritarian style of management. And it is a style of management that a number of large corporations have rejected in recent years and by so doing have reaped spectacular success.