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Posted on May 3, 2010

Small Enough To Succeed?

As the business world becomes more and more complex, perhaps one way to avoid future "Too Big to Fail" catastrophes is to encourage companies to stay small and nimble.

Twenty years ago Paul Solman visited a small company called Springfield ReManufacturing Company which refurbished truck engines. At the time, the company was wholly owned by the employees giving every worker the incentive to read financial statements and create a great product. CEO Jack Stack also says it preserves solidarity, flexibility, entrepreneurship, and it has created more opportunities for advancement at SRC.

Now the company has investments in almost 60 related companies, many still re-manufacturing cars, tractors, boats. But there's also a home furnishings firm, a warehousing operation, a business that teaches folks how to do business the SRC way.

NewsHour economics correspondent Paul Solman talks to employees of SRC and some business owners that have adopted the SRC way successfully.

"We saw the opportunity of being able to move them into their own businesses to make room for other people to be able to come up to the organization, because it wasn't only about jobs. It was about opportunities." Jack Stack, CEO SRC

"I had no idea about how important the numbers were in my business." Juliet Mee, director, Professional Massage Training Center, Inc.

1. What are some businesses in your community? Which are big national chains? Which are locally-owned and run?

2. What are some possible differences between big companies and small companies?

3. What does it mean if a bank is "Too Big to Fail"?

1. SRC says that it must keep its divisions small, what could be some pros and cons to that argument?

2. Why do you think that employees are more motivated if they have an ownership stake in a company they work for? Could this ever backfire?

3. Does this video encourage you to learn more about business? Why or why not?

4. What are some personality traits that make someone more likely to start their own business?

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