Leading a Small Business vs. Large Organization

I learned my leadership very early in my career.  In fact, I learned even before my career began. My leadership training came while I was in Air Force ROTC in college.  From there I spent 7 1/2 years applying what I learned in the best organization you can practice leadership – the United States military!  It was from this foundation I got started my new career in leading a small business in 1991.

Things in a small business are very different than in a large ones.  Trust me, I see large company executives retire and buy businesses that they run into the ground all the time.

This caused me to take a step back and ask the question “is leading a small organizations vs large one different?”  On the surface you might say – YES!  However, I believe you need to take a little deeper look before you can pass judgement.

Leading a Small Business

First, what is leadership?  It is influencing people to achieve a desired outcome.  But, the definition of leadership isn’t important.  It is the competencies required to be a good leader that count!

What are the competencies of good leadership?  This is debatable depending on who you talk to.  However, anyone that knows me knows I believe in simplicity.  So, I published an article some time ago with my list titled 10 Leadership Tips We All Can Learn From a Boy Scout.  If you have these competencies then you’re probably a pretty good leaders.

Now, let’s take this as a foundation and look at our question again.  Is leading a small business different than leading a large one?

If you have mastered the competencies of leadership leading a small business or a large organization shouldn’t matter – right?  This has been my experience over the past three decades.  It also is the premise by which I approach helping my clients.  Do they have the competencies of leadership mastered or do they need to work on some of them to lead their small business?

However, if you’ve followed any of my research and writing about small business growth, you know that there are two factors that influence business growth – leadership and management.

My tactical discipline is project management.  So, I learned early on that the role of a leader changes depending the size of the project.  As the project grows the leader spends less time doing tasks and more time leading people.

It’s no different in leading a small business.  The owner is a doer early in the early growth stages of the business.  They get stuck in nowhere land when they resist making the transition from doer to leader.

Why Corporate Executives Fail Leading a Small Business

So, why do executives from large organizations fail in leading a small business?  Because they haven’t mastered the skills of leadership!  The competency I see violated most frequently is humility.  Their attitude is. “I ran a team of 25 people and a budget of $5 million, this will be a piece of cake.”  WRONG!!!

First, if they RAN a team, that’s a dead giveaway.  You don’t run a team, you lead them!

Also, your team was probably responsible for 1 specific function within the large organization.  Now, you’re responsible for ALL OF THEM!!!  Do you have the expertise to manage every part of the business?

So, you might be saying, “well that’s different, Dino.”  You’re right, but that’s not a function of leadership.  It’s a function of business management.  Of course this is the long standing debate – “how are leadership and management different?”  Here is a perfect example that causes failure all the time.

I find those coming from large organizations with the humility say, “This is a different animal.  Show me what to do.” These leaders are usually successful.  That’s because they have mastered the competencies of leadership.  They know when to step back and allow those that have the skills to take the lead.  Using this approach they learn what they need to know to lead and gain the respect of those they lead in the process.  This is the sign of a good leader in ANY organization small or large!

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So, this has been my experience with leading a small business vs large organizations.  What has been your experience?  Are they similar or different?  Please share your story, so our readers can see the many different situations that they may experience as they look to master the competencies leadership themselves.