In a barney with Amazon about terms, being massive makes for a fairer fight: if retailers are going to get big, then suppliers have to match them in size if they want to square up. Same with the government: if you want to lobby Whitehall about VAT, employing x-thousand people and paying £y-m taxes buys you an invite to an influential lunch or two.
But in a lot of ways, big businesses are obsolete.
I don’t mean they will fail. I mean that the reasons businesses become big are no longer relevant.
Businesses get big to take advantage of economies of scale. Being big means a company’s operations can specialise into functional silos. Being big means having negotiation leverage. Being big means you can get even bigger, by having the heft to acquire competitors. Being big means people flock to work for you because of a secure paycheck (an illusion, by the way, when your contract says you’re on a couple of months’ notice).
But these places suck the creativity out of people.
Big businesses are not where you look for innovation or fast-paced invention. Try to get a simple app development project signed off in a large company: what would take a small company a morning morphs into a 6-month-long series of vibe-killing process-hoops. If an industry's character is dominated by big businesses, it’s static, frozen, condemned to a glacial rate of change. And this, in a world where technology makes lightning-fast change possible, is a threat to the survival of an industry.
Thankfully, our industry isn’t only composed of big businesses.
At London Book Fair this week, we are seeing what a diverse, interesting, varied marketplace looks like. Lots of companies, lots of points of view, lots of new ideas brought to market in different ways. The more diversity in our industry, the better.
So it’s good news that over the last few years, a multitude of new approaches have sprung up — in forms accessible to publishers of all sizes — which level the playing field of data and process excellence.
POD services have come of age, in terms of quality and price. There's the notion of crowd-sourcing. Cloud-based services abound, making data accessible from anywhere and providing new capabilities in everything from back office organisation to content management. We discussed all these and more at the Digital Minds “Branching Out” session on Monday, headed by Alison Jones, and a walk round the aisles at the Fair confirms that we're firmly into a boom period of new Web services and new business models.
These offerings mean that the problems that businesses have solved in the past by getting big can be tackled in other ways.
- Need to develop specialist design skills? Tender for a provider on Elance.
- Need to manage your finances professionally? Use Freeagent or Xero.
- Need to raise capital? Use Crowdcube.
- Need a way of managing your marketing to hundreds of thousands of customers? Use HubSpot.
- Need a lightning-fast, gorgeous ecommerce Web site? Use Shopify.
- Need to manage stock in the US, Australia, India and beyond? Use Shipwire.
- Need to build a scattered team of home-workers? Use cloud-based systems ranging from Google Drive to Dropbox.
- Need to collect micro-payments from chunked content sales from Facebook and bloggers’ Web sites? Use Valobox.
- Need to manage your content workflow in XML? Use Librios.
- Need to group together with like-minded folk to exhibit at the London Book Fair? Join IPAC, the Independent Publishing Agency Collective.
- Need a cloud-based publishing management solution that doesn’t require you to remortgage?
- Integrate all the above? Rely on elegant, simple APIs between applications.
Not all the solutions are brand-new-digi-magic, although their ongoing strength lies in their use of technology to manage their members’ data. Aggregators continue to have a role, from trade bodies, such as the PA and the IPG, to wholesalers of stock (Gardners, Bertrams), services (Inpress, Ingram) and data (Nielsen, Bowker). Their services allow smaller companies to group together for the common good: lowering costs, improving data flow, aggregating spend and heft for negotiation leverage.
And yet despite all these ways of operating successfully as a company with just a handful of staff and a shed-load of creativity, there’s still this assumption that companies have to get big. The start-up culture has a lot to answer for: it’s baked-in that the correct order of things is to raise angel, then venture capital; to scale as quickly as possible before you burn through the money.
There’s no vocabulary in the start-up world to describe a tech company which starts small, stays small, doesn’t raise money, doesn’t aim for an IPO or buyout exit.
There’s nothing wrong with a company staying small, staying true to its founding principles, employing a few happy staff, and maintaining a focus on the product.
And despite my grumbling about big business, it’s not actually impossible to be innovative and large.
Take 3M: a company who try to stay small-at-heart by hiving off projects into their own autonomous, small business units. 3M have themselves built the tools they need to remain spry. We can take a lesson from them: as an industry we must build our own innovative infrastructure tools so that they're fit for purpose, so that they answer the correct need and, crucially, so that they belong to us. If the infrastructure is created for us by third-party developers, then it won’t instinctively answer our needs.
Because whilst there has been a large number of new services come to market, there’s still plenty of headroom for tools to be developed that answer real publishing needs. Take APIs, for example. If a publisher signs up to the latest online POD management tool, an online rights marketplace, an ebook aggregator, and an online galley service, and if there are no APIs connecting those services to each other and to existing distributor and publishing management systems, then, rather than improving efficiency, the publisher now has to enter the same data in to more and more forms.
The answer is to develop APIs that link the systems together, allowing them to share data and taking the maintenance load off the publishers — entirely achievable for barely any cost with modern RESTful APIs. But some developers don’t feel the acute pain of a lack of integration between their solutions and their competitors’. There’ll only be the drive to develop the right tools that answer real-world problems if the people feeling the pain write the solutions. And too few publishers know how to code. (Have I mentioned that before?)
Not only that, but it seems every tech start-up following the raise-money-grow-exit model ends up being owned by Google or Amazon or another behemoth in the end.
If we don't develop digital tools ourselves, our own infrastructure will be owned by outsiders.
If we do ever get to that happy state of there being a sufficiently well-architected infrastructure to let companies stay small, prosper, and in turn contribute to a thriving, richly diverse industry, what will there be left for those companies to do? What is the role of a publisher -- small or otherwise? What do we aspire to do that makes us anything other than middle-men? Is our USP that we curate, edit, act as a hub?
I hope that technology will mean we can keep the focus of our work right where it should be: on the writing, and on getting our products in front of people who are interested in them.
We’re on the brink of being able to have a sufficient number of well-integrated, affordable tools to support a boom in innovation and, potentially, new companies, adding diversity to our already rich industry.
How wonderful if technology can help us to add to the diversity and vibrancy of the trade. How wonderful if we can write that technology ourselves, using it to build smaller, happier companies.
Because from happiness comes creativity.
Originally written for and published by The FutureBook in April 2015