Scalability, according to the Cambridge dictionary, is: the ability of a business or system to grow larger.
This may be obvious but scalability is often used to describe a business that gets bigger in order to export its goods or services. It is also used a lot in the tech world to describe a business expanding by making goods or services available online.
If you are running a small business and don’t want to get bigger or “scale up” as the jargon goes, what does scalability mean for you?
The ability of a system, as against an individual business to grow larger is the more interesting aspect of this definition. And this is where small businesses come into the equation.
Small is beautiful
Last year the United States Congress produced a 450 page report after a year long investigation into the large tech companies Amazon, Apple, Facebook and Google’s parent Alphabet. The CEO’s of these companies appeared before the Antitrust Subcommittee who concluded that the market power of these companies has reduced consumer choice and hindered competition. There is a long list of large companies worldwide that have gone under in the past year, hastened by the pandemic. Retailers feature in a big way (JC Penney, J Crew, Brooks Brothers, Debenhams, the Arcadia Group to name but a few), and many travel companies (Hertz car rental and several airlines). The scale of these companies was often a contributor to their downfall.
We seem to be going from a world where businesses were “too big to fail” to one where small is beautiful. Larger businesses are under more scrutiny. While giants like Amazon did well from the pandemic, consumers question whether Jeff Bezos needs their spending power to the same extent as the local family-run business. Smaller companies will now hopefully fill the gap created by the demise of larger businesses. And supporting smaller local businesses makes it easier for us to feel good about shopping.
More companies doing more
Scalability with reference to the climate crisis means more companies looking at their business model and making changes to reduce the amount of carbon they are emitting. So scalability means more companies doing more to address the issues of the climate crisis. As each company looks for ways to reduce their carbon emissions it can have a ripple effect throughout the supply and logistics chain. It may also have an impact on how the individuals working for a business behave too.
This time last year I wrote my first blog post on this subject. I looked at consumption and production and the finance industry and came to this conclusion.
We can use our consumer power to force corporations to provide us with sustainable alternatives to the unsustainable products we are currently offered. A good place to start is by asking questions. Who made my clothes? What’s the carbon footprint of my food? And where is my pension fund/savings money invested? As more people ask these questions businesses will have to provide answers and start to investigate alternatives.
What about the here and now?
With the world in the middle of a global pandemic many companies have had to reinvent themselves to survive until there is a resumption of something approaching normal trading. Except that what emerges will be a different normal. The disruption to our daily lives, at home and at work, has changed how we interact and upended a lot of the previous norms. This includes how and what we buy, and what we expect of companies that we interact with. More and more consumers want the companies they do business with to help them make a difference, see the Forbes article in the link below.
Sustainable scalability doesn’t mean small getting big but more and more small businesses adopting a sustainable business model. This will enable us all to create a world that arrests the increase in global warming so that the planet survives and thrives beyond 2030.
If you’d like to have a chat about making your business more sustainable, please book a free 30 minute call with me.
Links to articles mentioned above
Definition of scalability – Cambridge Dictionary
Is scalability the most important factor in sustainability? Retail Renewal 26/02/2020
Congress Reveals Plans to Break Up Amazon, Facebook, Apple, and Google. Observer 07/10/2020
88% of consumers want you to help them make a difference. Forbes 21/11/2018
World’s richest men added billions to their fortunes last year as others struggled. Washington Post 01/01/2021