Why Large Organizations Should Collaborate with Small Service Companies

Given the traditional view on large set ups bringing economies of scale, it may sound counter-intuitive to choose a small company when it comes to service delivery. The fact, however, is that if you are a large organization that is scouting for a service delivery company, it may be worth your while to look beyond the Size Does Matter mindset. Here is why:

#1 Close to the customer

Free from big hierarchies and cumbersome processes that many a time impact proximity to the customer, a small service organization is often in a better place to have close contact with the client. This in turn helps them understand and respond to customer needs with nimbleness. Especially in highly dynamic service industries such as the internet and the digital space, the importance of speed in launching a new product or service or pivoting from one format to another cannot be undermined.

#2 Culture of Innovation

Not bogged down by past experiences, small organizations are often more open to innovation. Driven by an entrepreneurial mindset, small service delivery companies can adapt to changing market conditions with far more agility. In fact, well-managed small service companies have a long-standing track record of being adept at foreseeing market trends and adapting new technologies to outperform their larger counterparts. As a partner this works to your advantage as they can adapt your product quicker based on market demands. With fewer management layers they also lend themselves to quick decision- making. Quick turnaround times for your business also stems from the fact that every member of a small team is typically self-sufficient and multi skilled. A lean, flat structure is also known to work better when it comes to seamless communication, a fact that companies in dynamic businesses have a lot to gain from.

#3 Specialists

A lot of small service companies are small because that is the way they choose to be. Structured as boutique firms, they are specialists in their domain. Partnering with specialist firms gives you an edge over working with larger companies that are often generalists and therefore not able to offer bespoke solutions

#4 Cost Efficiency

With smaller set ups having to invest lesser funds in terms of overheads as well as in terms of marketing costs, that they turn out to be more cost efficient as a partner, is a given.

#5 Personal rapport

It is a proven fact that large businesses have spent fortunes trying to replicate the personal connection and rapport that small firms build with customers. It is this feeling of kinship that drives a smaller firm to look beyond established KRAs alone to ride over tough projects and stringent deadlines.

In a Small Business Perception Survey done by Web.com/Toluna in US in 2013, the following factors topped the charts in the choice of small businesses:

% of respondents. Over other types of businesses

The above is not to undermine the advantages of scale that large businesses bring to the table. However, when it comes to service delivery, smaller budgets, fewer people and spartan amenities not withstanding, small businesses are known to perform.