Ran across this Charlie Munger quote a few months ago that stuck with me about the problem with larger companies and bureaucracy:
"...if you worked for AT&T in my day, it was a great bureaucracy. And in a bureaucracy, you think the work is done when it goes out of your in-basket into somebody else's in-basket. But, of course, it isn't. It's not done until AT&T delivers what it's supposed to deliver. So you get big, fat, dumb, unmotivated bureaucracies.
I think that's part of it. There's a natural human tendency to want to feel like you're accomplishing things, and in large bureaucracies it's easier to feel accomplished without actually getting the things done that need to get done.
Also from Munger:
"They also tend to become somewhat corrupt. In other words, if I've got a department and you've got a department and we kind of share power running this thing, there's sort of an unwritten rule: “If you won't bother me, I won't bother you and we're both happy.” So you get layers of management and associated costs that nobody needs. Then, while people are justifying all these layers, it takes forever to get anything done. They're too slow to make decisions and nimbler people run circles around them."
"...if you worked for AT&T in my day, it was a great bureaucracy. And in a bureaucracy, you think the work is done when it goes out of your in-basket into somebody else's in-basket. But, of course, it isn't. It's not done until AT&T delivers what it's supposed to deliver. So you get big, fat, dumb, unmotivated bureaucracies.
I think that's part of it. There's a natural human tendency to want to feel like you're accomplishing things, and in large bureaucracies it's easier to feel accomplished without actually getting the things done that need to get done.
Also from Munger:
"They also tend to become somewhat corrupt. In other words, if I've got a department and you've got a department and we kind of share power running this thing, there's sort of an unwritten rule: “If you won't bother me, I won't bother you and we're both happy.” So you get layers of management and associated costs that nobody needs. Then, while people are justifying all these layers, it takes forever to get anything done. They're too slow to make decisions and nimbler people run circles around them."