The following article was written by Nigel and was first published by the Australian Institute of Company Directors (AICD) in 2003. It has been copied dozens of times and I thought it was worth re-publishing it on my website.

Firstly a short story…

A mouse lived in a small house in India owned by the Singh family. The Singh’s had a modest life; the husband went to work every day at a local factory and only brought home enough money for them just to live on with no extras for special occasions. Although the house was clean and tidy, a mouse had decided to inhabit a small back wall of the house. After dinner every evening when the Singh’s were fast asleep in bed the mouse would creep out and eat the crumbs and odd food scraps off the floor. The mouse was pretty smart; he knew that it was in his interest to be very inconspicuous. He therefore left no tracks and was careful not be seen. As a result, the Singh’s were not aware they had a mouse. So the daily ritual was never detected and everybody (the Singh’s and the mouse) lived in perfect harmony.

However, the mouse wished that he could be something else. He didn’t like being a mouse having to live in hiding and only to come out at night. He longed to be something bigger, something that was grand. Every day he wished and wished for something to change, when suddenly a fairy, feeling sorry for the mouse decided to help out by offering the mouse the choice of becoming any animal that he desired, the only condition was that the animal had to be bigger. The mouse was really excited and thought and thought about what he would really like to be. He had seen a beautiful white horse whilst he sat in his mouse hole during the day watching the world go by. So he thought, “I would love to be a beautiful white horse”.

Within a blinking of the eye, the mouse was transformed into a white horse. This magnificent stallion stood proud. He was delighted that he had made the transition from a mouse to a horse and could not believe his luck to have made the change.

So there he stood, in the Kitchen near the back wall of the house. Mrs. Singh was agog. A horse had suddenly appeared in her kitchen. Although quite scared she was also delighted to be confronted with such a magnificent specimen. “What a magnificent beast; how did it get in and I wonder who owns it?” rushed through her mind. She quickly tied the horse up and places it outside in the yard and Mrs. Singh decides to wait for her husband to come home.

The horse likes the attention but is a little distressed with being tied up. He also feels a little hungry. However he can’t move around so he can’t get any food, and anyway the food scraps and crumbs would not be enough to sustain his appetite. He will have to wait and hopefully they will feed him when Mr. Singh gets home. Later that day Mr. Singh comes home and is told the story by his wife. He too is a little perplexed about where the horse would have come from. He looks the creature over and decides that they will try and find whom it belongs to and if an owner cannot be found then they will sell it.

Mr. Singh gives the horse some straw to gnaw on. “Straw!” thinks the horse, “I am used to eating cake, biscuits, bread and fruit. Not straw!” After several days, the Singh’s have not found an owner and they are finding that keeping the horse, even just fed on straw is costing them more money than they can afford. However, the profit from selling the horse is looking very attractive, so the Singh’s can live with a few weeks of hardship on the basis that the money they make by selling the horse will more than compensate.

The horse is also not too happy, he is not eating as well as he was and he has lost the freedom he had before. “Oh dear” he thinks to himself. “If only I hadn’t chosen to be a horse. A horse is an attractive creature and people can see value in them. It also eats a lot more than a mouse. When I was a mouse, I ate well and nobody knew I was around. I wish I could change back”. Before he could think another word, the fairy returned and spoke with him again. The fairy was quite distressed that the horse was so unhappy. She spoke to the horse and said “I’m sorry but you cannot go back to being a mouse. It’s too late. However, since I feel so sorry for you, you can choose to be another animal that is larger than the horse.

So the horse thinks it through again and this time he choses to be an elephant. Suddenly, the horse transforms to a large male elephant. Being so large and powerful, the elephant quickly breaks through the rope that was restraining the horse. The Singh’s are lost for words. They have suddenly lost a valuable creature and gained a beast that they could not share their home with even if they wanted to. It was clear that the elephant was comfortable in their back yard so what were the Singh’s to do? The Elephant was too big to restrain it stamped all over the back yard and wondered throughout the house looking for food. It went through the larder and ate all the weekly supplies. The Elephant being so big could walk and eat more or less what it wanted. In fear the Singh’s ran from the house and decided to move to a neighbor’s house until such time as the elephant decided to move on.

The elephant felt really good. Not since being a mouse had he felt so good. He was now able to tramp around anywhere and eat what he liked. The only drawback was his size meant he had to keep eating and he was certainly no longer inconspicuous.

The above short fairly story is a parody of business growth as I shall now explain.

Stage 1 Company – The Mouse

When a company is in its early stages it acts very much like the mouse. It looks for business scraps and tends not to be overly conspicuous. It can easily change direction and look for business in different areas. It is quick and it is mobile. It can react to change very quickly. However, like our mouse in the story above, there is a desire to grow and become very successful. For a small company to become a large company requires a veracious appetite and capability to grow. His means that our mouse has to be able to get more and more scraps and in the process it is more probably that it will be noticed. As a company gets bigger it becomes what I have called the Horse Stage company.

Stage 2 Company – The Horse

This is almost the nowhere ground between the two major states of a company. It is a transitory state that makes a company very vulnerable to takeover, merger and ‘annihilation’. Although it is a necessity for all companies that are growing to transit this stage, it is best if it is transited as quickly as possible to get to the final stage.

Stage 3 Company – The Elephant

This is the final stage of company growth and is highlighted by the difficulty that another company has in trying to undertake a merger or acquisition. The elephant also symbolizes the lack of ability to quickly undertaking changes in direction. Therefore although the elephant is the final stage of company growth it also represents the stage that is the most vulnerable to significant environmental change. The elephant needs more to survive and any change to its food source is likely to have catastrophic consequences.

Generally, every company seeks to become big and successful. They are looking at becoming elephants, when in reality success should not be measured by size but by the ability to survive. Taking this literally, how does the mouse compare with the elephant? Which creature has managed to increase its population by magnitudes over the last few millennia? Which creature has managed to survive in major variances of heat and cold? I think we all know that the answer is not ‘the elephant’.

The moral of the tale can be stressed in a few simple rules:

1. Success should not be measured by size.
2. If seeking to become a big company then transit the ‘Horse’ stage as quickly as possible.
3. Elephants don’t move as nimbly as mice and are more vulnerable to major changes.
4. Elephants need a lot more food than mice.
5. Never speak with fairies (or the press).