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Surviving the Siege

How Midsize Businesses can overcome disruption in Ultra-competitive markets

We live in an age where disruption is present in all sorts of ways in our daily lives - at all levels. We experience this as individuals, but the implications in business have a far greater impact.

Businesses around the world are constantly innovating and fighting for new customers. This rush is creating all sorts of challenges and complications for organisations of all shapes, sizes and sectors. But most notably for SME’s (Small and Medium Businesses). Why? Because like all companies, SME’s have to deliver to their customers to cover costs and guarantee revenue. But what differentiates them to enterprise, entrepreneurs or unicorns is an infinite budget, resource and operational flexibility. Meaning competitors are arising from virtually everywhere, capitalising on these restraints, penetrating the marketplace at speed and threatening their business continuity.

Competition is healthy, right? Of course, the challenge arises when a mid-sized organisations focus becomes on delivering on existing customer demands, operating the business and capitalising on the opportunities in front of them – leading to neglect in innovation and gaining competitive advantage.

Big companies act on this and due to their "muscle" they can invest and use their resources to move the market forces and fight back, commonly complicating things and creating disruption.

As a big company starts to engage more on a market through innovation, it has to get the right talent to do the work. And what better place to look at than the midsize companies pool - Offering attractive packages, fat checks and swanky offices to boot. It’s not to say Mid-sizes cannot offer comparable incentives, but it’s a threat which comprises the midsize marketplace’s ability to drive innovation and combat the market competition, whilst maintain their market position.

At the other end of the spectrum is the “Uber effect”. Lead by countless start-ups and entrepreneurs that are thinking in the next generation solutions they represent a fresh option to the market – adding another layer to the already competitive landscape. The challenge of threats of new market entrants is further fuelled by the fact that many of these start-ups are created by ex-employees of the SME who have great knowledge and are able to create innovation in a less rigid environment.

But what can we do?

First let’s identify why this is happening.

​1. As you recall, an SME has a big customer base. Well, this customer base is the priority for the company and it will do whatever on its power to deliver. Therefore, delivery becomes the priority and suddenly all the people that were once in charge of developing the product, is now stuck in operating the business.

2. As people gets more involved in operation, their day to day becomes more and more monotonous. If we were living times where your employees weren’t aware of all the opportunities out there (either to pursue a big check being employed by a big company or start their own business), SME life could be easy, but it is clearly not the case.

3. There is a shift in leadership in all the SME’s where newer management with fresh ideas are coming into place, but they face the reality of having to deliver, so this generates expectations but also difficulty to get the new generation products out there. Demand always wins! This in turn creates uncertainty and false hope to employees of whether they are going to innovate ever rather than operate.

4. If you happen to be a technology-based company, this gets much worse, because the rotation is overwhelming. In Ultra-competitive markets, people are shifting jobs at a pace that it is impossible to generate enough business knowledge and create valuable products or services. Meaning cost for knowledge is also raising at a pace that very few companies can keep up.

Sometimes business owners and executives at these SME may think, why did I make my company grow to this point, it seems I have more problems than before. Well it’s a reasonable doubt, but the reality is that you can never stop thinking of growing your business and it does not matter what you have to do, you will do it.

So, having that in mind there are some strategies that can help your company grow, innovate and boost retention on your key employees:

· Subcontract specialists to manage the repetitive tasks and maintenance and let your own team focus on innovation.

· Keep your team operating the business and subcontract specialists to innovate.

Both approaches offer pros and cons, and to select the right one for your organisation will depend on many factors. You can also combine approaches for different areas within your organisation.

What needs to be considered is whether if you need a really quick fix or if you can wait a little longer to generate new skills or competencies within your organisation to take on new projects yourself. Once you have that figured out, you can decide from there.

For instance if you want to rapidly increase retention to your customer base, and the only thing you need is to create an app and provide added value to your customers - perhaps you should go for an outside expert on mobile development and boost innovation that way while you keep operating the business.

On the other hand, if what you need is to create a long term strategy, where you will have to innovate on your core business, and create new offerings, well, that sounds better to handle it internally with your closest employees (who by the way have the best knowledge of your business). In that scenario, you can go for an outside provider to take on the repetitive tasks that are holding back your core team. This way you will make some room for them to innovate instead of operating.

Every situation will be different, but if you are stuck, you have to go for either route, right away.

I will leave a couple of recommendations to evaluate the qualities of the right partner:

Resource Availability (Muscle).

You have to be sure that the resources you are looking for are already available with your provider, or that they can get it faster than you would.

Sustainability and Continuity.

If you look for a partner to operate your business, you have to be sure that your partner will also be able to follow you as you grow once innovation is unlocked. Because at this point your partner will have already gained a lot of your business knowledge and you need him to keep up the pace.
(look for their expert’s CV’s and case studies)

Shared Accountability

Both, your partner and you, whether they are innovating or operating, have to be invested in you! What this means is that the team or persons they assign to you, have to breathe, and intensively live your business. Just as much any of your own and more loyal employees would.


You need to look for partners that can become your coaches or even your advisor. With the shared knowledge they may have from your industry, combined with yours, you can generate pretty nice strategies to outperform the competition. Look for concepts such as CTO as a service, CFO as a service.

Lastly, be confident that as an SME, your most powerful asset is your knowledge, resilience and determination. By using these strategies, you will unlock your full potential and start seeing results in a very short time. Cheers!

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