This chapter examines how the way in which the corporate executives deal with various challenges influences new business creation (Table 9.1).

It is difficult to pursue the bigger-is-better and the small-is-beautiful corporate philosophies simultaneously because of the fundamental difference in the scale of thinking, the duration of time, and the amount of resources needed to pursue bigger versus smaller opportunities. But with the right management approach it can be done.

How to successfully pursue the bigger-is-better and the small-is-beautiful corporate philosophies simultaneously

The challenge for corporate executives

With the small-is-beautiful corporate philosophy, the number of small wins needed to maintain the historical rate of corporate growth rises as the company grows. To take a very simple example, assume that a corporation needs to grow 10 percent from its new initiatives each year, and that a successful new initiative brings in on average $10 million in annual revenue. If the company's revenue is $100 million, it needs just one successful initiative (“win”), at $1 billion in revenue the company needs ten wins, and at $10 billion it needs a hundred wins.

For years 3M had been the model of the small-is-beautiful corporate philosophy for other companies, including AMP. But with more than $6 billion in revenue, 3M was experiencing increasing difficulty in securing the required number of wins each year with the small-is-beautiful corporate philosophy. (AMP, with $1.5 billion in revenue when this study ended, had not yet encountered this challenge.)