Complexity is the Enemy

Maybe it’s the feeling of self-importance we get from creating something seemingly irreplaceable. Maybe it’s the idea that in order to win you have to create something that others can’t replicate.

Whatever the reason may be, complexity is clearly running rampant in corporations, and this will soon be the reason for their demise.

In the 4 weeks it takes Meta to onboard employees, lean start-ups have created fully operational workflows that Meta was hiring said employees for.

Big companies have a myriad of over-engineered programs that they use for tracking, measuring, and reporting. They have mile long acronym lists with code words and useless jargon.

These ‘normal business processes’ have now become layers of resistance within their organization, delaying time to market. Eliminating their edge.

Corporations used to thrive off of complexity. You see, for years companies have built a moat around their services by making them extremely complex. If no one understands the recipe, people won’t be able to replicate it.

It was intentionally made to seem difficult and convoluted so that it would make natural sense to want to outsource the Sunday roast to large companies that seem to have the expertise to do it properly. God forbid you burn the chicken.

Information has always been available via the internet. But the amount of google searches to learn how to be the VP of marketing would be innumerable.

Accounting, engineering, software creation, marketing, sales required nuance known only for those that got the degree and worked their way up the ladder. The complexity of the system protected the system. Moat achieved.

Enter AI.

The difference is simple - it understands the nuance and can act on it. Not only can it understand how to be the VP of marketing, it can create the campaign strategy, execute the campaign, collect data on performance, and then review said data to determine if the strategy should be adjusted.

Think about it. Anyone in the world can now run marketing, engineering, business development, and accounting workflows all from a single laptop. How have large companies not grasped that the accessibility of AI is going to 100x their competition?

There is no more moat to be found in complexity. The goal is now removing friction. Efficiency without forgoing quality.

Large companies won’t all just keel over and die (although some certainly will). There are two commodities that may save them from disaster, and those are recognition and service bundling.

Recognition. There are hundreds of companies going online today, and they are all going to have to compete for name recognition amongst the fire hose of other companies being pushed to consumers and businesses. In an environment where anyone can automate marketing, how do you stand out from the pack? Existing mega companies like Oracle, Meta, and Microsoft, have already established a trusted name. People pick them out of a crowd. It’s a huge advantage.

Note: One way for the new guys to get around this is to associate themselves with an existing well-known company.

Service Bundling. Most start-ups are focusing on a single service, for example: automating sales outreach. However, a well established company might offer sales outreach, marketing, customer success, customized applications for larger clients… we call this full suite. The issue is that no one wants to buy a package of outdated services, so each service needs to be run like a start-up.

Note: Corporations would be intelligent to hire the founders of the latest start-ups to run those divisions in their company, and should offer them whatever it takes to get them on board.

Note: Start-ups can still be competitive over time by mastering a service, and then continuing on to stand-up other service offerings (and so on and so forth).

Regardless of these huge advantages, mega companies are in boiling hot water. Somehow they do not yet seem to understand the criticality of the situation they are in. Their moat has shifted, and their company structure has to change with it. If they don’t learn how to drastically simplify operations, they will not be relevant in 2027.

So why haven’t they done it yet? The struggle is this: The employees have never been more incentivized to hold and increase the complexity of their tasks. In fear of losing their job to AI, they must make what they do seem unattainable by AI. It seems we are at the point where the employee and the CEO now have completely opposing priorities.

CEOs are going to have to ruthlessly hack away at their current company structure. They are going to have to start from scratch in many different areas. The existing systems are too complex. They were built to be. Or they were built with old tech.

There are two ways to summarize this situation.

1) It’s inevitable that this will be a huge win for entrepreneurs.

We will see a boom in new startups, and there will be more business opportunities than millennials or gen-z have ever seen in their lifetime. This is our modern day gold rush, as long as you have speed to market.

2) Big companies are at a huge disadvantage.

but they still have brand recognition, consumer trust, and integrated services - so they aren’t wrong to want to stay in the race. They could still win if they are aggressive about their approach. To stay in the game, they will have to make major layoffs, try to grab up as many of the start-ups as possible, and automate 50% of their workflows by the end of year in uncomfortable, chaotic, and operationally risky ways (it may disrupt current customer commits).

The key to remember here is that speed & simplicity beat complexity. This is what I call “The Apple Effect.” Apple showed people that the key to market domination is surfacing the latest tech, but making it seamlessly easy to use. Aesthetic design, ease of use, and being the first to market will enable you to win.

In the same way that we try to do this with our products, we should also look to do this with our operations. Use lean, web-based apps like Asana or Monday that enable more flexibility and an easier interface. This simplifies the flow from idea to fruition, and also enables the company to pivot quickly.

How can we move quickly if we have daily reports that are funneled through Jira? Who is reading these email reports? How much time are we wasting? How can you automate tasks when it takes 20 clicks just to provide a status update?

Stop building admin heavy workflows that burden your teams and create human dependencies. Create workflows that are easy and don’t rely on a single person as a point of failure.

For big companies this will be the first challenge they are faced with, and it will also be the required stepping stone to automating their workflows.

For start-ups, this is how they should set themselves up from the beginning, automating as they go. That’s their edge. Their only edge, but a big one. It just might just be enough to beat out the big guys.