Closing In: The Optimum Corporation Size is Approaching One

An article in today's New York Times describes the evolution of the modern (mostly New York) hedge fund as the markets reshape that industry.  There are inevitable euphemisms: a person is not being "laid off," the Times identifies the phrase du jour as "It looks like we’ll be wrapping things up here."

So far, so predictable. The article's focus, though, is on the growth of the home office, exemplified by the rise of a service provider that specializes in giving that "big company feeling:"

Mr. Madigan [who works for the service provider, Chelsea Technologies, highlighted by the article] also found that many of his new home-office clients don’t want any old Gmail account. They want an e-mail account that looks and works and feels just like the one they had in their office, a level of familiarity that’s not just efficient but comforting. And that’s true for their other computer systems as well, right down to which corner of the screen they’ll see their instant messenger icon pop up. "We’re selling them that ‘big bank’ feel," said Mr. Madigan, who also helps set up his clients with computers with the power to handle market data feeds and high-volume printers. "Oftentimes they’re trying to look like a bigger operation, with a more professional approach," Mr. Madigan said.

It wasn't so long ago that the trappings of a corporation were all about bigness -- big buildings, big staff, big products (locomotives!  bridges!  oil fields!  container loads of toothpaste!)  The successful modern corporation, at least in the rich countries, is not about bigness but about closeness: can they provide a service that closely meets your needs?  The trappings of corporate presence are just that: trappings, cosmetic signals that the provider is a 'real business.'  More and more, those signals are defined by technology: email addresses, Blackberry accounts, and web sites.  And we know that nobody needs a big company any more to deliver those.