A corporate elevator hypothesis

Last year, three out of five floors of the WeWork where my office is located were completely taken over by a Fortune 500 pharmaceuticals company. In the past few months, something about this company’s employees has continued to befuddle me: despite easy access to stairs in the building, they insist on using the elevator to go up or down a single floor.

Aside from feeling the inconvenience that this behavior brings to everyone else working in the building, I've formulated a hypothesis that I think can explain why this company’s employees choose to act in this way. Quite simply, the extra minute or two it takes for them to wait for the elevator may represent time where they could look busy without actually doing anything of value.

As an entrepreneur, it irks me to no end when time is wasted. I have never taken the elevator to travel up or down just one floor, and when my office was on the sixth floor, I often chose to use the stairs instead of the elevator to leave the building - it was simply faster on average to do so, especially during peak hours. This juxtaposition of my habits and those of a large corporation’s employees made me suspect that perhaps the nature of their organizational environment explains their behavior.

Corporate inertia is real. When an organization gets large enough, an inevitable result is the need to have employees whose job is to manage other employees. Entire departments are eventually created to manage, measure, and police the work that employees in other departments do. I can’t remember who it was that made the scathing remark, “If the path to success in your company is to signal work is being done than to do actual work, that company is dying and you should quit now.”

Of course, such companies could survive or even remain profitable for a long time. Some, such as Apple and Microsoft, could experience a “re-founding” with a visionary leader (or in Apple’s case, its original leader) after a lengthy period of stagnation. Others, from Blockbuster to Kodak to even General Electric, might fade into relative obscurity and eventually oblivion.

I think there are two lessons here:

1. Be wary of working for huge companies if you want to do meaningful work.
2. Startups can compete with and often even outrun huge companies.

Corporate challenges

The above nine slides from Netflix's famous culture deck encapsulates the problems that companies face as they grow: complexity increases, talent density decreases, and the ensuing chaos results in the introduction of more process that further drives out talent.

Netflix focuses its entire culture on minimizing organizational complexity to attract and retain high performance employees. Most other companies do not.

The logical conclusion is: if you don't work for a Netflix-like large company, and assuming you're a high performance talent, odds are high that you will be shackled by excessive process and relatively low performance colleagues.

Startup advantage

Startups, while small and cash-poor, present freedom from red tape, a closer relationship with each customer, and infinitely more flexibility as they don't need to lay off hundreds or even thousands of employees anytime they actually admit that a particular strategic direction was ill-advised.

A startup can get a thousand "No's" and just one "Yes" from an investor, and they would still be able to build their idea. The same idea, in a large corporation, would likely need to go through multiple departments and get a "Yes" each time without a single "No". This difference in process explains why smaller companies are more innovative, and why Amazon, one of the largest companies in the world, desperately clings onto whatever shred of startup DNA it still possesses by exhorting to its employees that "It's always Day 1."

I'm not saying that it's always better to work for a startup. Some people value the stability that a large company brings, the comparatively higher compensation, or the better work-life balance.

It's important to note, however, that a corporate job requires significant sacrifice as well - less freedom, more wasted time, and a general dearth of high performance colleagues. Plus you'll also need to get used to colleagues who take the elevator to go up or down just one floor.