SMBs or small-to-medium sized businesses are the heart of many European economies. Here in Spain, the amount of family-run and small businesses clearly outnumbers the presence of multinationals. The current situation presents pros and cons for these types of organisations.

On the one hand, you have the flexibility or independence to act both locally and globally. While multinationals must follow a determined corporate strategy marked by common objectives and general guidelines, family businesses have the ability to enter and leave markets with the push of a button.

However, the downside of this situation is that family businesses tend to suffer the most because their existence depends solely on their core business. Family-run businesses have limited resources and in times of crisis, banks offer less financing to what they consider to be vulnerable lines of business.

Some possible solutions for SMBs must necessarily pass through innovation and diversification. Diversification was the key to the success of a number of businesses in the ‘80s when companies began to adopt the Japanese model of business, which awarded innovation and shunned older, traditional production methods.

Once again, we must reconsider our business models. The new business model of the 21st century must necessarily include the following ingredients: fresh, new vision; moral leadership; diversification in both thought and action; and finally service to a newly defined target consumer market.

A fresh, new vision that includes but does not absorb: mobility, global vision, freemation, diversification, and willingness to lend a helping hand. Mobility is probably the newest ingredient to a successful business equation: laptops, mobile phones, mobile telecommunications, etc. Freemation has always existed to various degrees: special offers to attract customers, philanthropic events and drives, and of course, community services.

But nowadays, sharing information and resources with both consumers and competitors is one of the biggest nuances of our times. We can no longer compete in the realm of resources: we must share our resources. Where we can compete in a healthy, quality driven market, is in how well we offer a personalised service which includes the satisfaction of specialised, individual needs and how they relate to the collective good of society.

Diversification is a productive process which necessarily includes change management. In his book on change management, Tom Peters underlined the need to manage change. While doing so, he gave some very sound advice: “Test fast, fail fast, adjust fast.” Learning from your mistakes is not an easy process and requires a great deal of patience, but one thing is for sure: “If at first you don’t succeed, try, try again.”