Krubski says small business is the future hope of the American economy
Is the following statement true or false?
"Small business is the once and future hope of the American economy."
A resounding true contends Westport futurist John Krubski, who in 2004 created "The Index of What Matters Most."
While critical of big business during his talk to Westport Sunrise Rotary two weeks ago, Krubski could have been considered to be biting the hand that fed him. Here's why:
In the past, Krubski's served as futurist and innovation consutant to top companies, including American Express, Charles Schwab, Outback Steakhouse, Sears, IBM, Compaq, Michelin, Fox Television, DreamWorks, Ford, Mercedes Benz, Quaker Oats, General Mills and Pepsico.
"Small business is the once and future hope of the American economy," Krubski said to the Rotarians, many of whom are small business owners and who appeared elated to be cited as vital contributors to the Gross Domestic Product (GDP). The GDP is the sum or all goods and services produced within a nation's borders.
According to the Bureau of Economic Analysis (BEA), real GDP increased at an annual rate of 5.6 percent in the fourth quarter of 2009 -- that is, from the third quarter to the fourth quarter. In the third quarter, real GDP increased 2.2 percent.
"The acceleration in real GDP in the fourth quarter primarily reflected an acceleration in private inventory investment, an upturn in nonresidential fixed investment, an acceleration in exports, and a deceleration in imports that were partly offset by decelerations in personal consumption expenditures (PCE) and in federal government spending," stated the March 26 report from the BEA.
"Small business in America employ as many as the Fortune 500 companies," Krubski said, propping up his contention that small business has more starch in its small backbone than the giant corporationg that caused the financial meltdown by "falling on their faces."
"That triggered the meltdown that caused the recession," he added.
Krubski said the bulk of small businesses actually may just consist of one- or two-person entities who dedicate considerable time to keep their operations up and running. A key ingredient of the small businesses, Krubski said, is that they know their clients and customers by name and embrace them as friends -- a philosophy that Westporter Jack Mitchell advanced in his book, Hug Your Customers.
Krubski said the women, disenchanted with career opportunities in the giant corporations, have fled from the corporate ivory towers and opened their own small business, where they have complete control of their destiny and are often much closer to home.
According to Krubski, one of the major downfalls in big businesses is that they are not as productive as small businesses. It takes the bigs more people, more time and more room to move around or to change course when marketing conditions change, he said.
"Small business will prevail over the bigs by 2030 -- many of them operated by women," Krubski predicted.
He also threw something new into the mix -- a fact that sociologists and marketeers have identified within recent years: "That, for the first time, there are six living generations within America."
That has happened because, among other factors, 25 years have been added to the lifespan since the turn of the century in 1900. In the resultant new mix of generations,the youngest one is the HomeLanders -- children under nine. There are 22 million of them and they account for $150 billion of the GDP. And the group is still growing.