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Why Apple Failed in Building Cars and Is Struggling in AI: The Dilemma of Big Companies and Professional Managers
When an organization grows, it gets bigger.
When it gets bigger, it needs more people.
With more people, management becomes necessary.
Once you manage, you need systems.
Systems demand metrics.
Metrics must be tied to goals and compensation.
And once compensation is tied to performance, rational individuals will naturally choose the safest path — repeating what has already been done, to secure stable and predictable rewards.
Thus, “path dependence” quietly takes root.
This isn’t laziness — it’s systemic rationality. In a large organization, the cost of risk far outweighs the benefit of staying the course. Even when leadership announces a bold new vision, every level below instinctively pulls that strategy back onto familiar ground.
As a result, no matter how visionary the top-down strategy may be, a powerful counter-torque emerges from within the organization.
It doesn’t outright reject innovation — instead, it breaks it down, dilutes it, and domesticates it, turning radical ideas into safe, watered-down compromises.
