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Transparency places an emphasis on size and culture.

7746599 549bdc24e9 o Transparency places an emphasis on size and culture.

Image via: http://www.flickr.com/photos/sd/

Transparency has been on my mind for a bit recently due to the operations as marketing presentation I’ve been writing. (Transparency is, of course a fundamental requirement of any company that wants to turn its operations into marketing because people have to be able to see the operations in order for them to work.) However, I’ve started to realise that transparency (or operations as marketing) is a strategy that’s only open to certain types of companies.

The problem with transparency, of course, is that your competitors can see what you’re doing along with your customers. If your competition then decides to copy your strategy then the difference between you and them will come down to:

  1. The way in which you execute the strategy
  2. How well you can execute the strategy
  3. How cheaply you can execute the strategy

Items 2 and 3 strongly favour large companies. They can throw lots of resources at a problem, plus – as the Dell Swarm idea so cleverly illustrates – they can bring their scale to bear on forcing prices down. The only way that small companies can compete is by outperforming on item #1 which, to me, is a product of culture. The more unique your culture, the more unique your execution will be, because your culture shapes how you see the world and colours how you respond to it. Also, a strong culture may also enable you to lower your personnel costs by creating a place where people are competing for jobs.

Not sure this is anything very new, just more evidence that you either have to be really big or really different to thrive.

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This entry was posted on Tuesday, May 19th, 2009 at 10:20 am and is filed under culture, marketing, operations, transparency. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

  • very good
  • Hi Adrian
    Love your blog and really value your thought leadership and take on the digital marketing perspective.

    I'm not as concerned about transparency as the post seems to emit, one of the reason is hopefully explained in this quote and following article on “experiences”, by Sohrab Vossoughi, founder and president of ZIBA design, found via experientia.com:

    "There is still one frontier that remains wide open: experience innovation. This is the only type of business innovation that is not imitable, nor can it be commoditized, because it is born from the specific needs and desires of your customers and is a unique expression of your company’s DNA.”

    http://www.experientia.com/blog/ziba-design-fou...
  • Yes I definitely agree with you and the premise (although it's ironic that one of the companies he cites - Nau - went out of business). I think we're saying the same thing though as the bit that isn't copy-able is "your company's DNA."

    BTW: Helge, thanks for the compliment, but it's people like you and Edward who make me smarter. Plus, I'm pretty sure I've stolen a bunch of stuff from your excellent blog too ;D
  • Adrian:
    Transparency definitely suggests you can execute brilliantly (just think of how we announce wars and attacks and troop transfers long before the event actually happens.) But I must disagree with the idea that large companies have an advantage at executing cheaply. Look at the American auto industry. Look at the large ad agencies that have excess overhead to drive up costs. Small companies have an advantage in being transparent. They get attention, build anticipation, and can then use their vision and nimbleness to deliver the goods. I am assuming that's what you guys do every day.
  • Good point, I think you are right - often size brings with it terrible inefficiency and unnecessary duplication of efforts and I agree small companies can be far more nimble. However, I think the reason we and other small companies are seen to thrive is that we aren't (yet) seen as a big enough threat to large companies who could come in and out-execute us at our own game. Perhaps this is the paranoia of being an owner in a company but I think that for every big automotive company that is tied up in its own process and inefficiency, there is a Dell that has really optimised its processes to remove as much waste as possible. If the agency version of Dell decided to get into our niche we'd be hard-pressed to compete.
  • We're trying. See what happens ;-)
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