Theory vs. Practice in Small Business Setting Essay

  • Last Edited: June 13, 2017
Theory vs. Practice in Small Business Setting Essay

When it comes to working in any sort of organization or corporation, one of the obvious chasms that becomes clear here is the relationship between theory and what is practiced in a small business setting. To truly look at and assess that paradigm, the author of this report has interviewed an owner/manager at a small business to discuss what they do to make things work, what is suggested in theory and scholarly literature and how those frameworks and lessons do or do not work for their particular situation. The author of this report will personally be making a comparison and contrast between what is asserted within the literature and compare it to the feedback and personal experience narrative of the owner/manager. A common refrain seen in the blogosphere and elsewhere is that there is a disconnect between what is suggested in the minds of theorists and within the so-called ivory towers of academia and political think tanks. There is perhaps some truth to that common anecdote but there surely has to be some fire to go with the smoke that is the innovation and ideas that come out of academia. After all, not everyone in the academic and scholarly sphere is an insulated wonk with no real-world exposure. While the applicability of theory to real-world situation and practice might be hit or miss in some instances, the interview with the owner/manager that is the subject of this report clearly shows that academic sometimes gets it completely right.

Analysis of Experience

The author of this report took the time to sit down with the owner/manager of a business that has about two dozen employees. The epicenter of the analysis and ideas that are being looked at by the author of this report and as reflected by the owner/manager is a small team of four people that all share in about six total tasks. Anyhow, there was the idea that rose with the manger himself as well as the team that perhaps it would be more efficient and wiser to consolidate some tasks to two (half) of the people and the other tasks to the other half. Further, about half the of the tasks were client contact-related while the others were mainly internal in nature. The general idea was to keep each half of the team as homogenous as possible in terms of the jobs they did so as to avoid the number of differing tasks and multi-tasking that went on. This surely has its roots, at least in part, in a lot of the scholarly literature that is out there. Indeed, there are some sources out there that suggest multi-tasking is just another way of saying that one is doing more tasks without properly or fully excelling at any of them. In other words, doing one task and to completion is always going to be better than trying to juggle two or more at the same time (Weightman et al, 2017). Further, there is perceived benefit from many scholars when it comes to limiting the number of overall tasks, meaning the consolidation of as much like tasks as possible so as to avoid variability in tasks and keep people more productive (Camden, Nickels, Fendley & Phillips, 2017). Separating the people-based and non-people-based tasks would also tend to limit interruptions that the non-people task people are doing (Szumowska & Kossowska, 2017). Anyhow, the manager explains that the consolidation of tasks did show some promise and at first seemed to coincide fairly well with the theorists when it came to the subject. However, there were some adjustments that were necessary and there are some interruptions that are just not preventable. There will always be the urgent email that comes through and the demands of clients do not always align clearly with what could happen in theory. Even if some people disagree, there are many in the scholarly sphere that suggest that the loss of performance occurs at the brain level and it is not just something that is perceived or guessed about (Al-Hashimi, Zanto & Gazzaley, 2015).

Even with the proverbial speed bumps when it came to translating the common feelings and research about multitasking to the practice of the small business in question, there was still the personal and internal perception that the variability of tasks and the commonality of interruptions led to decreased performance. There was the further perception that perhaps keeping half the tasks entirely with half the team and half the tasks with the other half of the team. To test this, there was a look at how things before in terms of perceived performance as well as measurable metrics such as service level agreement performance, quality of work done and so forth. There was then a compare and contrast with what happened after the changes were implemented. As noted already, there were some bumps in the road but those were ironed out by testing and experimentation. Generally, it can be said that the theory was solid and strong overall but that adapting that to the particular situation at hand was something that required some diligence and adjustments. This is to be expected as no cookie-cutter or general approach is going to work without at least some customization and details being hammered out. A key part of making things work is asking the hard questions, hammering out the details and making sure that the ownership and management is on board with letting the chips fall where they may rather than trying to force something that is not going to work.

Other Topics

While the task reassignment project was one of the major overhauls that the owner of the business engaged in, there were other challenges and questions that at were discussed. As was the intention, the author of this report touched upon a litany of topics and theories and the owner gave his feedback based on what he has seen and done as it relates to the topic. Before getting into that detail, it should be noted how the business came to be. As noted earlier, the manager is also the owner. The owner/manager initially started working in the private sector as an employee for another business. It came to be that he was considering doing his own business and operation within the same industry and he concurrently felt he could do things better than what he witnessed in his employee job. However, he had to scratch up the money to do so and he also had to have a contingency to keep himself afloat and his bills paid while he brought the business online. It took him about a year, but he used all of his own funds and transitioned from working for someone else to working on his own over the course of a year or two. The additional twenty or so employees that work for him now have been added in the two to three years since then. He is having to add a new head to his staff about once every month or two, on average. This is obviously a break from what is seen with startup firms in Silicon Valley and other places that get significant amounts of venture capital and investment that allow a firm to lose money for months or years while they build up a consumer base and eventually become self-sufficient. The owner/manager interviewed for this report used all of his own money and still had to make ends meet from the inception of the business until it was self-sufficient for at least him. Now that it is self-sufficient and self-sustainable, he is much happier and feels that the long hard and effort was all worth it, even with the trial and error. He says that some frameworks and ideas in the scholarly and news sphere have been helpful but he also feels that every business has to devise a framework and solution that works for their industry, their geographical area and their goals. In many ways, this aligns very well with the verbiage and ideas put forth by many people in the scholarly sphere in that no solution or frameworks is entirely “plug and play” (Pullins, Timonen, Kaski & Holopainen, 2017).

As already noted, the author and the owner/manager segued through a number of theories and ideas surrounding small businesses and how they remain competitive and innovative. First up is the idea of shifting alignment of workloads, lot splitting and proper operation overlapping issues. It is perhaps more applicable to situations that involve manual labor and shop work. However, the topic could also be used in a way that applies to any job duties, task splitting and multi-tasking handling is of utmost concern. The owner/manager says that the aforementioned splitting and re-splitting of work is a good example of how this can at least be tried but that the details and context of the tasks being split, the people involved and the size of the business all matter a great deal. It became workable for his team but also said that perhaps it would be easier for a different or larger firm (Fernandes, Land & Carmo-Silva, 2016).

Speaking of company size, the topic of ethics came up and the owner manager explained that it is much easier to follow and enforce topics like utilitarianism, deontology, rights, duties and social contracts in a small business setting. However, his ability to devote a lot of money to entirely optional and cost-added corporate social responsibility efforts is much more constricted than it would be with a firm that has a much larger budget or pool of money (Grant, Arjoon & McGhee, 2017). He also has spoken to a lot of other small business owners as well as people with larger firms and there is a disparate amount of ideas and concepts of what CSR really is and that the size of the business does matter. Put another way, Lowe et al (2016) says that “it would appear that social practice theories can be a useful analytical vehicle for academic analysis but cannot resonate with the modernist consciousness of the practical actor (Lowe, Rod, Kainzbauer & Hwang, 2016; Bos-Brouwners, 2010). The author of this report quoted that line to the owner/manager and he said he whole-heartedly agrees. He says that even if a small business owner wants to do more to help society, the ongoing survival of the business has to be the primary priority. After all, what applies to small business may or may not apply to larger businesses, and for more than one reason (Rizzo & Fulford, 2012). Even so, he knows that are people that could do better but do not, even if it is for vexing reasons. A real-world example of this is hand-washing practice in medical and surgical realms (Mortell, Balkhy, Thannous & Long, 2013).

As the conversation went on, it because clear to the author of this report that a major takeaway from this dialog is that focusing on the size of the business is important when comparing theory and practice. For example, it makes complete sense to the owner/manager that people that are cultural sensitive and/or multilingual is a good thing to focus on. However, the owner/manager also notes that finding the right job skills and traits is more important and this sometimes leads to those cross-cultural skills becoming an opportunity cost (Visser, 1995).

Even with that downside, the owner/manager notes that he is able to be much more flexible and agile than a larger business ever could be. This is obviously due to the lesser amount of personnel and hierarchy involved (Zontanos & Anderson, 2004). Another important aspect of the change described for the author’s workplace is change management and business process management. The ability to change and evolve the business via business process management (BPM) is greatly amplified and easier to pull off with the owner/manager’s space due to the lower amount of people involved as well as the lesser amount of complexity. BPM is something that the owner/manager is very passionate about. He states he is always assessing and reassessing how jobs are done and how they could be done better. The task realignment example above is but one example, according to him. Regardless of what precise steps and options are used, there needs to be a constant focus on a process mindset so that nothing important is missed or passed over (Smart, Maddern & Maull, 2009).

The owner/manager says that he is fortunate because he is in the service industry because he feels that effecting major change in a business, small or large, is much easier when speaking of a service sector industry like his rather than one that is based on manufacturing, physical products and so forth. In addition to the passion to perfecting things, he says that he tries to avoid relying on necessity to be the mother of invention. In other words, he will try to perfect a solution or fix a problem right away and will not wait until there is a major crisis or problem. He feels that this is a competitive advantage for him given that he acts when there is the chance rather than waiting for a problem and he is in an industry and business size realm that allows for quick adjustments and changes (Radovic, 2013).

Even with the above agility and some of the luxuries seen with small businesses like his, the owner/manager notes that there are legal roadblocks and other challenges that all businesses have to deal with on some level such as human resources, tax compliance and so forth. Rather than having dedicated people such as an HR manager, there are instead people that wear a lot of “hats” within the firm. For example, a lot of the HR functions of the firm are done by the owner/manager and the supervisors (Brady & Lowell, 2014). The owner/manager notes that not dealing with HR is not an option and outsourcing to other people or firms just tends to complicate things even more (Brook & Milner, 2014).

One other important aspect of innovation and learning that the manager/owner swears by is the use of networking. Even though there are the common learning and innovation channels of scholarly journals and the like, the use of networking with other people can be very useful and can bridge a lot of the gaps that exist between theory and practice and this is something that both the owner/manager and the literature agree on (Ford & Mouzas, 2013). The lessons to learn when it comes to growing and expanding a business is one subject that smaller businesses would be wise to learn about when they can (Phillips, 1996).

Before wrapping up, there are a few other quick topics that were touched upon between the author of this report and the owner/manager that was interviewed. One example is that the owner/manager asserted that information technology and the ability to multi-task at least somewhat is something that all small business owners and employees must do well to thrive (Harrison, Myktyn & Riemenschneider, 1997). Further, while some of the laws and regulations vary not depending on size, there are other laws and regulations that specifically pertain to small business are often different and that will affect the operational constraints in question. This is something the owner/manager has learned first-hand (Zachary, 2014). Because if the disparate nature of the laws in large and small businesses, along with the finances and resources that are commonly available, the strategy options and the strategies selected are going to be different (Ghezal, 2015). When it comes to division of duties and assignments, family struggles and squabbles can enter the fray. This is something prevalent in the literature and the owner/manager concurred even though he is the only owner of his business and thus does deal with this himself (Devins & Jones, 2016). The family angle could be an issue in the business that the author referenced but it did not come up in the particular situation mentioned. This would obviously be less of an issue in firms that are owned by people that are not related and/or that are publicly traded on a stock exchange. In those cases, whomever is a shareholder would have the power with the biggest power going to those that owned the most shares. Again, the owner manager does deal with this personal but he has seen many of his peers encounter some major power struggles and issues (Sepe, 2017; Ramsay, 2015).

Conclusion

In the end, the owner/manager interviewed for this report was quite limited and unique. Even so, he says that this was clearly by design and he would rather be the main person that operates the company. He knows that the business will likely cease to exist if he were to pass away or become disabled. Even so, he is fine with that and is not concerned about passing on a legacy to someone else at this time. In many ways, he breaks the mold that is described in a lot of the literature. However, he also confirms a lot of other stories and frameworks.

Essay Prompt

With close reference to a small business of your choice, submit a written analysis highlighting the relationship of theory to practice. This might refer to your own working environment, or to one in which you have worked. Your work should address the following:

1. An analysis of your research process and experience (20%). Set out here how you came to identify and approach the owner manager, and your research methodology.

2. Then, more broadly, an exploration of the business behaviour of the people concerned and how it meets or doesn’t meet particular evidence, theories and frameworks in the Small Business Management literature. You must demonstrate the ability to analyse your evidence critically, making links to theory. Please make sure that any strong statements are supported by evidence, example and reference. Quotation from your interview(s) should be referenced in the normal way.

Word limit is 3,000 words

References

Al-Hashimi, O, Zanto, T, & Gazzaley, A 2015, ‘Neural sources of performance decline during continuous multitasking’, Cortex; A Journal Devoted To The Study Of The Nervous  System And Behavior, 71, pp. 49-57, MEDLINE, EBSCOhost, viewed 3 May 2017.

Bos-Brouwers, HJ 2010, ‘Corporate Sustainability and Innovation in SMEs: Evidence of Themes and Activities in Practice’, Business Strategy & The Environment (John Wiley & Sons,  Inc), 19, 7, pp. 417-435, GreenFILE, EBSCOhost, viewed 3 May 2017.

Brady, K, & Lowell, W 2014, ‘Theory vs. Practice: A Study of Business Consultants and Their Utilization of Corporate Culture in Daily Practice’, Journal Of Practical Consulting, 5, 1, 1-22, Business Source Premier, EBSCOhost, viewed 3 May 2017.

Brook, C, & Milner, C 2014, ‘Reflections on ‘creative’ action learning in business education: some issues in its theory and practice’, Teaching In Higher Education, 19, 2, pp. 126-137, Academic Search Premier, EBSCOhost, viewed 3 May 2017.

Camden, A, Nickels, M, Fendley, M, & Phillips, C 2017, ‘A case for information theory-based modelling of human multitasking performance’, Theoretical Issues In Ergonomics  Science, 18, 3, pp. 266-278, Business Source Premier, EBSCOhost, viewed 3 May 2017.

DEVINS, D, & JONES, B 2016, ‘STRATEGY FOR SUCCESSION IN FAMILY OWNED SMALL BUSINESSES AS A WICKED PROBLEM TO BE TAMED’, Vezetéstudomány  / Budapest Management Review, 47, 11, pp. 4-15, Academic Search Premier, EBSCOhost, viewed 3 May 2017.

Fernandes, N, Land, M, & Carmo-Silva, S 2016, ‘Aligning workload control theory and practice: lot splitting and operation overlapping issues’, International Journal Of Production  Research, 54, 10, pp. 2965-2975, Business Source Premier, EBSCOhost, viewed 3 May 2017.

Ford, D, & Mouzas, S 2013, ‘The theory and practice of business networking’, Industrial  Marketing Management, 42, 3, pp. 433-442, Business Source Premier, EBSCOhost, viewed 3 May 2017.

Ghezal, S 2015, ‘ASSESSING THE VALIDITY OF A SMALL BUSINESS STRATEGY INSTRUMENT USING CONFIRMATORY FACTOR ANALYSIS’, International  Journal Of The Academic Business World, 9, 1, pp. 79-87, Business Source Premier, EBSCOhost, viewed 3 May 2017.

Grant, P, Arjoon, S, & McGhee, P 2017, ‘Reconciling Ethical Theory and Practice: Toward Developing a Business Ethics Pedagogical Model’, Business & Professional Ethics  Journal, 36, 1, pp. 41-65, Business Source Premier, EBSCOhost, viewed 3 May 2017.

Grigorios, Z, & Alistair R, A 2004, ‘Relationships, marketing and small business: an exploration of links in theory and practice’, Qualitative Market Research: An International Journal, 7, 3, pp. 228-236, Business Source Premier, EBSCOhost, viewed 3 May 2017.

Harrison, D, Mykytyn Jr., P, & Riemenschneider, C 1997, ‘Executive Decisions About Adoption of Information Technology in Small Business: Theory and Empirical Tests’, Information  Systems Research, 8, 2, p. 171, Computer Source, EBSCOhost, viewed 3 May 2017.

Lowe, S, Rod, M, Kainzbauer, A, & Hwang, K 2016, ‘Exploring the perceived value of social practice theories for business-to-business marketing managers’, Journal Of  Organizational Change Management, 29, 5, pp. 751-768, Business Source Premier, EBSCOhost, viewed 3 May 2017.

Mortell, M, Balkhy, H, Tannous, E, & Jong, M 2013, ‘Physician ‘defiance’ towards hand hygiene compliance: Is there a theory-practice-ethics gap?’, Journal of The Saudi Heart Association, 25, 3, pp. 203-208, MEDLINE, EBSCOhost, viewed 3 May 2017.

Phillips, PD 1996, ‘Business retention and expansion: Theory and an example in practice’, Economic Development Review, 14, 3, p. 19, Business Source Premier, EBSCOhost, viewed 3 May 2017.

Pullins, E, Timonen, H, Kaski, T, & Holopainen, M 2017, ‘An Investigation of the Theory Practice Gap in Professional Sales’, Journal Of Marketing Theory & Practice, 25, 1, pp. 17-38, Business Source Premier, EBSCOhost, viewed 3 May 2017.

Radović, R 2013, ‘Business Challenges and Design: Theory and Practice in the Furniture Industry in the Republic of Croatia’, Business Systems Research, 4, 2, pp. 79-93, Business Source Premier, EBSCOhost, viewed 3 May 2017.

RAMSAY, I 2015, ‘Increased Corporate Governance Powers of Shareholders and Regulators and the Role of the Corporate Regulator in Enforcing Duties Owed by Corporate Directors and Managers’, European Business Law Review, 26, 1, pp. 49-73, Legal Collection, EBSCOhost, viewed 3 May 2017.

RIZZO, A, & FULFORD, H 2012, ‘UNDERSTANDING SMALL BUSINESS STRATEGY: A GROUNDED THEORY STUDY ON SMALL FIRMS IN THE E.U. STATE OF MALTA’, Journal Of Enterprising Culture, 20, 3, pp. 287-332, Business Source Premier, EBSCOhost, viewed 3 May 2017.

Sepe, SM 2017, ‘Board and Shareholder Power, Revisited’, Minnesota Law Review, 101, 4, pp. 1377-1455, Legal Collection, EBSCOhost, viewed 3 May 2017.

Smart, P, Maddern, H, & Maull, R 2009, ‘Understanding Business Process Management: Implications for Theory and Practice’, British Journal Of Management, 20, 4, pp. 491- 507, Business Source Premier, EBSCOhost, viewed 3 May 2017.

Szumowska, E, & Kossowska, M 2017, ‘Motivational rigidity enhances multitasking performance: The role of handling interruptions’, Personality & Individual Differences, 106, pp. 81-89, Academic Search Premier, EBSCOhost, viewed 3 May 2017.

Visser, C 1995, ‘Theory and practice: a defense of small business language strategies’, European Business Journal, 7, 2, p. 49, Business Source Premier, EBSCOhost, viewed 3 May 2017.

Weightman, M, McCulloch, K, Radomski, M, Finkelstein, M, Cecchini, A, Davidson, L, Heaton, K, Smith, L, & Scherer, M 2017, ‘Further Development of the Assessment of Military Multitasking Performance: Iterative Reliability Testing’, Plos ONE, 12, 1, pp. 1-19, Academic Search Premier, EBSCOhost, viewed 3 May 2017.

Zachary, M 2014, ‘U. S. EMPLOYMENT LAW AND SMALL BUSINESS MANAGEMENT—ILLUSTRATIVE THEORY AND CASES’, Global Business & Economics Anthology, 2, 127-137, Business Source Premier, EBSCOhost, viewed 3 May 2017.

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