Is Bigger Better?

Is Bigger Better?

IS BIGGER BETTER? 4

Is Bigger Better?

Both articles delve on the issue of size. However, Chandler’sargument is more compelling. He clearly notes that largeorganizations cannot just become competitively advantaged due totheir size. Size is important because conducting business largerscale is cheap. However, Chandler (1990) notes size on its own isinadequate to completely exploit the cost benefits of scope andscale. Industries must create national and later global marketing aswell as distribution organizations. He further argues that growingfirms must structure their companies into diverse subdivisions, whichmakes it possible to conform to the competitive market. Schumacher’sview is less compelling because his argument is mainly an oppositionon the need for large organizations. Unlike Chandler, he does notexplain how firms, despite being large can work towards becomingcompetitive. Instead, Schumacher (1973) insists on the need to attainsmallness in action.

References

Chandler, A. D. (1990). The enduring logic of industrial success.Harvard Business Review, 130- 140.

Schumacher, E. F. (1973). Small is beautiful: A study of economicsas if people mattered. London: Blond and Briggs. (Part I/Chapter5: A question of size)