In that same Smithsonian conversation mentioned earlier, Steve also addressed other critical reasons why established companies don’t perform as well as they could, and why that will always create an opportunity for entrepreneurs and start-up companies.
One of the things that happens in organizations as well as with people is that they settle into ways of looking at the world and become satisfied with things. And the world changes and keeps evolving and new potential arises but these people who are settled in don’t see it.
That’s what gives start-up companies their greatest advantage. The sedentary point of view is that of most large companies.
In addition to that, large companies don’t usually have efficient communication paths—from the people closest to some of these changes at the bottom of the company to the top of the company, the people making the big decisions.
There may be people at lower levels of the company that see these changes coming but by the time the word ripples up to the highest levels where they can do something about it, it sometimes takes ten years. Even in the case where part of the company does the right thing at the lower levels, usually the upper levels screw it up somehow.
IBM and the personal computer business is a good example of that. I think as long as humans don’t solve this human nature trait of sort of settling into a worldview after a while, there will always be opportunity for young companies, ...