
The Theory That Explains Why Everyone Went Crazy
Odd Lots
Cybernetics of Corporations
- American railroads, among the first large corporations, faced management challenges as their networks expanded.
- Centralized control became difficult as complexity increased, exceeding the head office's capacity.
- Solutions included adding staff and wireless communication, but ultimately, devolution became necessary.
- This involved splitting into branches, granting subsidiaries autonomy, and matching management bandwidth to control needs.
- Large organizations typically grow, become complex, attempt centralized control, fail, and then reorganize, devolving power or spinning off parts.
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