Pros and Cons: Working for a Big Company vs a Small Business

Reviewed by Melina Theodorou

big company vs small business

When it comes to our professional development, choosing a suitable career path is only one part of the equation. Another factor that is just as important is deciding the type of business we want to work for. 

Unless you decide to go down the self-employment route, you will need to consider your future employer in terms of their brand reputation, career opportunities and the benefits you can expect as their employee.

Many of these aspects are directly linked to the size of an organisation; small businesses operate very differently than large companies. 

Here, we outline the advantages and disadvantages of working for both a small and a big company so that you can make a truly informed decision.

The pros of working for a large company

Defining what constitutes a large business can be tricky as this can vary from one industry to another. For instance, the US government’s Small Business Administration considers any business in the mining industry with under 500 employees, to be small. On the other hand, a company selling computer programming services is deemed to be large if its annual receipts exceed $21 million. 

While there’s some room for discussion here, in most cases, researching the company’s size, annual turnover and brand will give you a good indication of whether they fall into this category or not. 

Without further ado, here are the pros of working at a large company.

1. You have financial security

While a small business might depend on investment rounds to keep the payroll going, large companies usually have enough cash flow to weather changes in market conditions or a temporary drop in sales. 

Large companies tend to be more profitable and have a well-established reputation and partnerships that sustain their financial future.

Larger businesses also have the means and resources to attract bright talent, which allows them to stay competitive. This means that choosing to work for a large company usually means better pay as well.

2. You get more perks and benefits

More profit also means better perks and benefits for employees. For instance, did you know that Goldman Sachs covers the cost of gender reassignment surgery for its trans employees? Or that Deloitte offers six-month sabbaticals with 40% pay?

These, and many other benefits, make large companies a desirable employer for anyone who expects more than just a good salary.

3. There are well-defined processes

If you thrive when everything is organised and well-defined, then you’re destined to work for a large business. Big companies have been around for a while, so they’ve had plenty of opportunities to test what works for their business. 

They’ve been able to define their best practices and everyday processes so that employees know their tasks and responsibilities.

4. You will have a better status

Just like graduating from Oxbridge can be a symbol of academic prestige, working for the likes of Google, Amazon or PwC can serve as proof to future employers that you’re an employee of the highest calibre. 

Getting into a large organisation is incredibly competitive, so beating the competition and landing a job can speak volumes about your credentials, skillset and unique talents as an employee.

5. There are more career development opportunities

Similarly to the other perks, most big businesses have a dedicated budget for internal training and the professional development of their employees. Unlike small firms where most of the learning happens on the job, large businesses have whole departments dedicated to creating and delivering formalised, high-quality training. 

Also, big employers offer more networking opportunities. You’d have a chance to collaborate with many talented people who would eventually either start their own business or move on to a new one, giving you an invaluable pool of connections that can help you further your career in the long-term.

The cons of working for a large company

Despite all these fantastic perks, not everything is rosy when working for a large firm. There are also serious drawbacks which you need to consider before you make your final decision.

1. There’s more bureaucracy

This is the other side of the coin when we discuss ‘well-defined processes’. Large businesses must be organised and have well-documented operations if they’re to be successful. However, this can sometimes be detrimental to its employees. 

Getting anything done in a large organisation can take more time as you might need three or four people to sign off on a decision before it’s approved. Likewise, simple things like changing your work laptop can initiate a lengthy process of paperwork and inter-departmental back-and-forth. 

2. You will have less agency as an employee

If you want to showcase all your talents, a large company might not be the best fit. Big businesses have well-defined roles for almost every aspect of the business, and they hire people specifically to fulfil these roles. 

This often means that you don’t have the agency to challenge or try out new things. Likewise, you will rarely be able to single-handedly make a decision and act on it. Whether you want to give a client a discount or try out a new process, you’d probably need the approval of several managers before you can proceed.

3. There’s less room to experiment

As mentioned, in big companies, employees are assigned specific tasks and responsibilities, and it would be tough for you to move outside of that scope. 

Most large businesses pride themselves on their policies and procedures as they’ve worked hard in defining them. However, this can stifle creativity, spontaneity and opportunities to innovate.

4. There’s stiff competition 

Remember all the talented people we discussed that work in these large organisations? Well, while they can be great colleagues, they can also make your internal career progression almost impossible.

Large businesses can be notoriously political, with dozens of people aiming for the same job promotion at any given time. It’s not uncommon for people working at a large company to stay in the same job role for five to ten years before they either move up the ladder or to a different company.

5. There’s less transparency 

If you’re the thousandth employee joining the business, it’s very likely that you will be far removed from any strategic talks about the direction of the company. All decisions about market positioning happen behind closed doors, where the C-suite executives and heads of departments discuss more prominent issues. All other employees are given information on a need-to-know basis. 

If you’re the type of person who wants to have their say and wants to feel involved in the direction of the business, this could be a significant shortcoming for you. 

The pros of working for a small company

You might be convinced that a large business is the way to go. Still, don’t rush into a decision before you hear out all the perks that come with working for a small business. Not only do you have a 192% higher chance of landing an interview with a smaller company, but you can expect many other career-defining benefits as well.

1. It’s easier to stand out

When you work for a small business, there’s nowhere to hide. Everyone needs to pull their weight if the business is to be successful. This is an excellent opportunity to stand out and showcase to the senior team all your skills and talents. 

If you want to go beyond your core responsibilities, there would be plenty of opportunities to take on more or different types of work and become an invaluable member of the team.

2. You can see the impact of your work

When working for a large company, you’d often work on very specific, segmented tasks. This can make it difficult to see the impact a small task has on the bigger picture. 

However, this is not the case when you work for a small business. There, the impact of the work you do is visible. Pulling through a sale this month instead of the following month can mean the difference between salary or no salary for employees. Likewise, defining and running that Facebook ad can make the difference between leads and no leads for your sales team. 

3. There’re more opportunities for growth

Many small businesses lack key departments like account management or learning and development. This means that there will be plenty of opportunities to take on a new role without too much competition. 

As you start wearing more hats and work on various projects, you also have the chance to experiment and decide what direction you want to take your career towards. 

And at the end of the day, it’s easier to become the Head of Operations for a company with twenty employees than one that has 10,000. 

4. You work closely with the core team

The senior management team of a small business could consist of two or three people who will expect each employee to bring their A-game and help the business succeed. The need to have all hands on deck could mean that the company has more transparent processes and that the senior team shares the business strategy across the whole company. 

When employees know the strategy and what’s at stake, they have more ownership over their work, and you will likely be more willing to go the extra mile for the company. 

Having direct access to the core team will not only help you learn more about running a business, but it will also allow you to work closely with them and make a lasting impression.

5. You get valuable practical experience 

We talked about the formalised training you can expect to receive at a large company, but nothing beats hands-on experience. 

When you work for a small business, you’ll face real-life challenges that large companies either don’t have or, if they do, they’d never land on your desk. Things like broken demos two hours before a client visit with no people to help can really push you to think creatively and find innovative solutions.

The cons of working for a small company

Despite its many benefits, working for a small company might not be for everyone. There are inherent risks, unpredictable working hours and instability that can make working for a small business a less attractive option for people who are more risk-averse.

1. There’s a lack of financial security

It’s very likely that if you work for a startup or a relatively small company, they’d be strapped for cash. They might depend on their next investment round to be able to hire and pay their employees or might rely on steady sales to keep a healthy cash flow. That makes them vulnerable to any changes in market conditions, which can sometimes literally make or break a business. If you’re the sole or the main breadwinner in your family, this might be too big of a risk to take.

2. You’d wear many hats

This might be an attractive option for someone who wants to try out different things or have their hands in several pots. However, if you’re the type of person who wants to focus on one thing only, working for a small business might not be the best environment. 

Small employers often have escalations and emergencies with very little staff to take ownership of them. That means that employees from other departments often have to step in and help where necessary. For instance, it’s not uncommon for employees in startups to work in sales and handle customer complaints.

3. There’s constant change

Small businesses don’t have the experience and infrastructure that make large businesses so successful. They must continuously pivot, iterate on existing processes and update their workflows to adjust to changing client and market needs.

You might have nailed the process for handling customer complaints only to come back from holiday and discover that everything has changed, yet again. Change is often a positive and natural part of business growth, yet this can be draining and stressful for the employees. 

Not only that, but a lot of the times, you might be the first employee to face a specific challenge or gap in the business, and you’d have to find a solution and write up the process for business continuity.

4. You’ll have unpredictable working hours

In line with the previous two points, the lack of predictability and the fact that you’d need to wear many hats also means that you’d need to work longer or unpredictable hours. The business won’t have too many people to rely on, so if there are escalations or imminent trips to a client site, you’d probably have to bite the bullet and do the extra work. 

This can be very rewarding as you can see the direct impact of your work, but it can be tiring and unsustainable for people who prefer steady, steady working hours. 

5. There are fewer employee benefits

Small businesses try to be competitive and offer benefits like gym memberships or health insurance. However, this pales in comparison to other expensive perks that big employers offer.

Small businesses won’t have an allocated training budget either, so you’d have to rely on your on-the-job training to upgrade your skills and keep your personal development plan (PDP) on track. 

Of course, job perks aren’t everything, and sometimes the mission and vision of a small business can be enough to keep you going. However, if these added benefits are important to you, then a small employer might not be a good option for you.

When it comes to working for a small or big business, there isn’t one right answer as there are pros and cons for both types of employers. 

While a large business can splurge on a luxurious getaway for its employees and offer great salaries and stability, small businesses can awe you with their innovative thinking, flexibility and freedom to be truly creative. Both can be a great option as long as you know what to expect!

So, if you are currently looking for a job, head to CareerAddict Jobs to find a new position.

Would you rather work for a small or big company? Let us know your thoughts in the comments section below!

This article is an updated version of an earlier article originally published on 1 June 2015.