Can an SME afford to be honest and open?
An entrepreneur friend who runs a successful SME asked me that question after he read my post on the SME openly communicating about their plight and their plans as they tried to recover from a shutdown forced by Covid-19.
He pointed out that traditionally SMEs have been bullied and exploited by the big buyers. He explained the typical scenario. The big bosses in purchase do not want just a quotation from you. They grill you to reveal your cost. Then they decide how much they will pay you as “cost plus”. They are too big for you to walk away because your competitors are waiting to grab the chance. They even dictate what you should produce when.
He found it difficult to believe that after being nearly finished off by the virus, the SME I wrote about got up and had an open session, hiding nothing.
Collaboration first
As I had the opportunity to know some such big “purchase bullies”, I could sympathize with him. But I pointed out that, the current situation was anything but normal. Whether you are a giant or a medium enterprise, everybody is scrambling to fix the supply chain. Suppliers not queuing up before for you to arbitrarily pick and choose. Both buyers and sellers are on the ground, trying to unravel the “new normal” together.
There is now a premium on the known and trusted, on quality, on reliability, on agility and on the ability to innovate. Yes, even in a simple boss-subordinate equation, hiding or exploiting extracted information was part of power play. Now, survival is not about outsmarting the competition. It is about collaboration so that both can survive.
Get up and talk about your problem. Do not be surprised if the first one to help you figure out the solution is your ex-competitor. The only way to survive is to pull together. Yes, the opportunity to differentiate will come. But I believe the days of deceit and exploitation of the small and medium by the giants are over.
Next: The customer has so much technology to keep in touch. Yet are you losing touch with them?