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Sometimes I wonder why big corporations can even exist competitively as there is such downward pressure on productivity as they grow. Some companies handle thi
by netmau5 16y ago
Sometimes I wonder why big corporations can even exist competitively as there is such downward pressure on productivity as they grow. Some companies handle this better than others, Amazon being one that comes to mind first, but everyone ultimately suffers a significant efficiency loss at scale. The only reasonable answer that occurs to me is that the economies of scale and available capital provide such a dominating competitive advantage as to allow outmaneuvering of smaller companies whom are 10x as profitable.
- bioh42_2 16y agoSometimes I wonder why big corporations can even exist competitively as there is such downward pressure on productivity as they grow. High barriers of entry. In 99% of cases the barrier is either capitol requirements, government regulation or both. Or to put in other words, any business which can be challenged by a startup, will be. And it is only a matter of time until enough startups iterate through enough business plans until they find one that will steal your business. So either be productive or be behind significant barriers to market entry.
- _delirium 16y agoNetwork effects are a major barrier as well. The biggest problem facing a Facebook or eBay competitor, and the problem that's faced various would-be Windows competitors, is that it's hard to beat a platform that derives value in large part from its ubiquity.