Reflecting on Amazon’s new HQ in New York

We are entering an era in which companies dream of becoming cities.

They will fail, almost certainly.

A company can not mimic a city without being as dynamic and as self-organized, even if it surpasses a city in size or revenue by a large margin; companies have a naturally shorter lifespan.

This happens since cities have the freedom of a bottom-up flow, coupled with certain network properties that are vital for a superorganism to adapt to the environmental changes. Corporations cannot always stir fast with the moves of the market (elaboration for another post). They are a different animal. Obesity kills them eventually if they don’t die a natural death.

Due to structural differences, after a certain level of growth companies experience decline in their rate of “innovation” – the very glue that holds cities together. Unlike cities and forests their synergy will eventually stop and reverse, then they can not carry their own weight unless they innovate and disrupt. Companies can not scale forever.

* * *

And can tech giants innovate proportional to their growing size, i.e. with a so-called “superlinear” rate?

No, not passed a certain size. Not with a gigantic mass, a top-down flow and a compartmentalized structure. For these giants to grow bigger than this, for them to be worth trillions or to become cities and last, they need to revolutionize their structure. But they simply don’t have the code for it.

Of course innovation will keep taking place in megacities but increasingly outside these campuses, even if they try to attach themselves to megacities like Amazon is trying to land on New York’s metropolitan area.

What tech giants should do at this point is to downsize their mass, their physical manifestation, lay off and restructure, then grow again but that is not how public companies are ruled. Their leaders may well be aware of this better than the average shareholder, but neither have a better next possible move on the board. They are accustomed to follow a natural course for the evolution of the mega-creatures they are shaping. And in that course there is no prospect of keeping the pace of the innovation. This is not about the talent-base; this is a structural failure and it’s emergent.

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What are these companies going to do with their facilites when doomed by their nature they have to let go of their extra load?

In the most organized and systematic scenario, these buildings will be taken over by a new generation of emerging insitutions and reused for different purposes than they are built for. So they better design them with flexibility.

In another foreseeable future our kids shall play techno in their abandoned halls, or whatever fusion the spirit ot their time will be!

And I think this will happen no later than a couple of decades, perhaps gradually. Doesn’t need to be any apocalyptic scenario, system collapse, war or political revolution.

I will place a long-term bet on this one too.

Author: admin

Paranoid Data Scientist Based in Oslo

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