Being small can be pretty great.
Maybe it is a human trait, but we are obsessed with growth. We always seem to want to be moving to the next thing. Is it just how we are wired? For the next dopamine fix? Now, do not get me wrong, growth certainly is positive but is it the end all be all? We go to endless lengths just to show growth in a single quarter. If there isn’t constant growth, then shareholders get restless, and CEOs lose their jobs. But sometimes, the whole thing seems downright silly.
Let me give you a recent example. Last quarter, Apple posted profits of $89.5 billion. That is an insane amount of money. No one is going to call that a bad business but since they did $90.1 billion that quarter the year before, their stock price went down. $89.5 billion in the bank was not good enough, and investors got spooked because “maybe they are going down”. It is pure madness.
This mindless endless growth focus at all costs has created a terrible problem in our society where humans are treated like resources to grow a business and not humans that have value in their own right. The term “human capital” became a thing. The business will do about anything to be as profitable as possible. Walmart receives approximately $6.2 billion each year in predominantly federal taxpayer subsidies. This is attributed to the fact that Walmart's low employee wages result in many of them depending on government assistance programs such as food stamps, Medicaid, and six other taxpayer-funded initiatives (Americans for Tax Fairness [ATF], 2015, p. 1). Walmart hands out packets when employees get hired, on how to get government aid. How can anyone call this ethical? But Walmart is considered a great business and a sound investment. This seems so wrong, doesn’t it?
Why not focus on being the best you possibly can be? Going deep for your clients or customers? Why not try to add more value to your product offerings at every step? Why not treat clients like partners in building something rather than only a resource to make a profit?
This is one of the things I saw happening in the IT industry that I did not like at all. The term is called managed services. There is nothing inherently wrong with managed services and sometimes, it is the absolute right thing. But it doesn’t seem to be a very client-forward perspective. Typically, you get charged per month per computer you have regardless of whether you have done any work with that computer or not. They charge simply to monitor everything. Sometimes it’s worth it, but often it isn’t. I struggled personally with the concept of getting paid without really offering much value. Certainly monitoring services have value, but to charge a monthly fee on a computer that will never be worked on just seemed wrong. That’s one of the things we do differently at Mastiff by design. We view each client as unique and custom-build solutions each time. Of course, there is overlap, but technology is there to serve the needs of the business, not the other way around. Technology is simply a tool and a tool that should be shaped to the needs of the user.
It is customary in Japanese businesses to do a 1-year, 5-year, 10-year, and 100-year business plan. Now, of course, planning for 100 years in the future doesn’t make much sense but it is a great thought exercise. Am I building a long-lasting company that provides real value to people or am I looking for a quick payout? Now, there is nothing wrong with either approach but we choose the former. Let us build something that lasts. This is why we choose slow organic growth. This allows us to go in deep with a client’s needs and help them on a different level rather than just “fixing a computer”. Technology is an amazing tool that can give your business a competitive advantage. So let us harness it.
Once the business is making the money that everyone needs to have the lifestyle they want, why artificially pump it full of hormones? Why go into debt just for the sake of growth? As long as you are not saddled with debt (Mastiff has never taken on debt ever), you are growing the financial assets and everyone is making great wages then improve yourself first. Improve the business and then the growth will come. We chose to stay small on purpose for these reasons. We like calling our shots. We like not having the headaches of being a large company. We like being able to turn on a dime and follow new technology where it leads. We like spending extra time with clients when we can. If we only focused on growth then metrics like ticket close time and turnaround time become more important than connecting, understanding, and real collaboration. It doesn’t seem worth it from here.
Chris
References:
Apple. (2023, October 10). Apple reports fourth-quarter results. Apple Newsroom. https://www.apple.com/newsroom/2022/10/apple-reports-fourth-quarter-results/
Apple. (2023b, December 13). Apple reports fourth-quarter results. Apple Newsroom. https://apple.com/newsroom/2023/11/apple-reports-fourth-quarter-results/
Americans for Tax Fairness [ATF]. (2015). Walmart’s Wage Hike to $10/Hour Still Requires Large Taxpayer Subsidies. THE WALMART TAX SUBSIDY, 1.